10-12B/A

As filed with the Securities and Exchange Commission on December 23, 2013

File No. 001-36108

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 2

to

FORM 10

GENERAL FORM FOR REGISTRATION OF SECURITIES

PURSUANT TO SECTION 12(b) OR 12(g) OF

THE SECURITIES EXCHANGE ACT OF 1934

ONE Gas, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Oklahoma	46-3561936
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
ONE Gas, Inc. 100 West 5th Street Tulsa, Oklahoma (Address of Principal Executive Offices)	74103 (Zip Code)

(Registrant’s telephone number, including area code)

Copies to:

Joseph L. McCormick, Esq. Senior Vice President, General Counsel & Assistant Secretary ONE Gas, Inc. 100 West 5^th Street Tulsa, Oklahoma 74103 (918) 588-7000 Frank E. Bayouth, Esq. Skadden, Arps, Slate, Meagher & Flom LLP 1000 Louisiana Suite 6800 Houston, Texas 77002 (713) 655-5100

Securities to be registered pursuant to Section 12(b) of the Act:

Title of each class to be so registered	Name of each exchange on which each class is to be registered
Common Stock, par value $0.01 per share	New York Stock Exchange

Securities to be registered pursuant to Section 12(g) of the Act

None

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

INFORMATION REQUIRED IN REGISTRATION STATEMENT CROSS-REFERENCE SHEET BETWEEN INFORMATION STATEMENT AND ITEMS OF FORM 10

Our Preliminary Information Statement is filed as Exhibit 99.1 to this Form 10. For your convenience, we have provided below a cross-reference sheet identifying where the items required by Form 10 can be found in the Information Statement.

Item No.	Caption	Location in Information Statement
Item 1.	Business	See “Summary,” “Risk Factors,” “The Separation,” “Business,” “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Certain Relationships and Related-Party Transactions”
Item 1A.	Risk Factors	See “Risk Factors”
Item 2.	Financial Information	See “Summary,” “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Selected Historical and Pro Forma Financial Data” and “Management’s Discussion and Analysis of Results of Operations and Financial Condition”
Item 3.	Properties	See “Business—Properties and Facilities”
Item 4.	Security Ownership of Certain Beneficial Owners and Management	See “Security Ownership of Certain Beneficial Owners and Management”
Item 5.	Directors and Executive Officers	See “Management”
Item 6.	Executive Compensation	See “Management,” “Compensation Discussion and Analysis” and “Executive Compensation”
Item 7.	Certain Relationships and Related Transactions	See “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Management’s Discussion and Analysis of Results of Operations and Financial Condition,” “Management” and “Certain Relationships and Related-Party Transactions”
Item 8.	Legal Proceedings	See “Environmental and Safety Matters,” “Business—Legal Proceedings” and “Certain Relationships and Related-Party Transactions—Agreements with ONEOK—Separation and Distribution Agreement—Transfer of Assets and Assumption of Liabilities”
Item 9.	Market Price of and Dividends on the Registrant’s Common Equity and Related Shareholder Matters	See “Summary,” “The Separation,” “Dividend Policy” and “Capitalization”
Item 10.	Recent Sales of Unregistered Securities	See “Description of ONE Gas Capital Stock”
Item 11.	Description of Registrant’s Securities to be Registered	See “The Separation,” “Dividend Policy” and “Description of ONE Gas Capital Stock”
Item 12.	Indemnification of Directors and Officers	See “Management” and “Description of ONE Gas Capital Stock”

Item 13.	Financial Statements and Supplementary Data	See “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements” and “Index to Financial Statements” and the financial statements referenced therein
Item 14.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	Not Applicable
Item 15.	Financial Statements and Exhibits	See “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements” and “Index to Financial Statements” and the financial statements referenced therein
	(a)    List of Financial Statements and Schedules
	The following financial statements are included in the Information Statement and filed as part of this Registration Statement on Form 10: (1)    Unaudited pro forma financial statements of ONE Gas, Inc. (2)    Audited historical balance sheet of ONE Gas, Inc., including the Report of Independent          Registered Public Accounting Firm (3)    Annual audited financial statements of ONE Gas Predecessor, including the Report of Independent Registered Public Accounting Firm (4)    Unaudited interim financial statements of ONE Gas Predecessor
	Schedules not mentioned above have been omitted because the information required to be set forth therein is not applicable or the information is otherwise included in the financial statements or notes thereto.
	(b)    Exhibits The following documents are filed as exhibits hereto:

Exhibit No.	Exhibit Description
2.1	Form of Separation and Distribution Agreement by and between ONE Gas, Inc. and ONEOK, Inc.**
3.1	Form of Amended and Restated Certificate of Incorporation of ONE Gas, Inc.†
3.2	Form of Amended and Restated By-Laws of ONE Gas, Inc.†
4.1	Form of Senior Note Indenture by and among ONE Gas, Inc. and the other parties thereto*
4.2	Form of Common Stock Certificate**
10.1	Form of Tax Matters Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.2	Form of Management Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.3	Form of Transition Services Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.4	Form of Employee Matters Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.5	Form of ONE Gas, Inc. Indemnification Agreement between ONE Gas, Inc. and ONE Gas, Inc. officers and directors**
10.6	Form of ONE Gas, Inc. Annual Officer Incentive Plan**
10.7	Form of ONE Gas, Inc. Pre-2005 Nonqualified Deferred Compensation Plan**
10.8	Form of ONE Gas, Inc. Employee Nonqualified Deferred Compensation Plan**
10.9	Form of ONE Gas, Inc. Pre-2005 Supplemental Executive Retirement Plan**

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10.10	Form of ONE Gas, Inc. Supplemental Executive Retirement Plan**
10.11	Credit Agreement by and among ONE Gas, Inc. and the other parties thereto**
10.12	Form of ONE Gas, Inc. Officer Change in Control Severance Plan**
10.13	Form of ONE Gas, Inc. Equity Compensation Plan**
10.14	Form of Restricted Unit Stock Bonus Award Agreement**
10.15	Form of Performance Unit Award Agreement**
10.16	Form of ONE Gas, Inc. Employee Stock Purchase Plan**
11.1	Statement re: Computation of Per Share Earnings (1)
21.1	Subsidiaries of ONE Gas, Inc.**
99.1	Preliminary Information Statement of ONE Gas, Inc., subject to completion, dated December 23, 2013**

* To be filed by amendment.

** Filed herewith.

† Previously filed.

(1) Information required to be presented in Exhibit 11.1 is provided on page F-4 of the Information Statement of ONE Gas, Inc., filed herewith as Exhibit 99.1, in the section entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements.”

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SIGNATURE

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.

ONE Gas, Inc.

By:	/s/ Curtis L. Dinan
	Name:	Curtis L. Dinan
	Title:	Senior Vice President, Chief Financial Officer and Treasurer

Dated: December 23, 2013

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EXHIBIT INDEX

Exhibit No.	Exhibit Description
2.1	Form of Separation and Distribution Agreement by and between ONE Gas, Inc. and ONEOK, Inc.**
3.1	Form of Amended and Restated Certificate of Incorporation of ONE Gas, Inc.†
3.2	Form of Amended and Restated By-Laws of ONE Gas, Inc.†
4.1	Form of Senior Note Indenture by and among ONE Gas, Inc. and the other parties thereto*
4.2	Form of Common Stock Certificate**
10.1	Form of Tax Matters Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.2	Form of Management Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.3	Form of Transition Services Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.4	Form of Employee Matters Agreement by and between ONE Gas, Inc. and ONEOK, Inc.†
10.5	Form of ONE Gas, Inc. Indemnification Agreement between ONE Gas, Inc. and ONE Gas, Inc. officers and directors**
10.6	Form of ONE Gas, Inc. Annual Officer Incentive Plan**
10.7	Form of ONE Gas, Inc. Pre-2005 Nonqualified Deferred Compensation Plan**
10.8	Form of ONE Gas, Inc. Employee Nonqualified Deferred Compensation Plan**
10.9	Form of ONE Gas, Inc. Pre-2005 Supplemental Executive Retirement Plan**
10.10	Form of ONE Gas, Inc. Supplemental Executive Retirement Plan**
10.11	Credit Agreement by and among ONE Gas, Inc. and the other parties thereto**
10.12	Form of ONE Gas, Inc. Officer Change in Control Severance Plan**
10.13	Form of ONE Gas, Inc. Equity Compensation Plan**
10.14	Form of Restricted Unit Stock Bonus Award Agreement**
10.15	Form of Performance Unit Award Agreement**
10.16	Form of ONE Gas, Inc. Employee Stock Purchase Plan**
11.1	Statement re: Computation of Per Share Earnings (1)
21.1	Subsidiaries of ONE Gas, Inc.**
99.1	Preliminary Information Statement of ONE Gas, Inc., subject to completion, dated December 23, 2013**

* To be filed by amendment.

** Filed herewith.

† Previously filed.

(1) Information required to be presented in Exhibit 11.1 is provided on page F-4 of the Information Statement of ONE Gas, Inc., filed herewith as Exhibit 99.1, in the section entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements.”

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EX-2.1

Exhibit 2.1

SEPARATION AND DISTRIBUTION AGREEMENT

by and between

ONEOK, INC.

and

ONE Gas, Inc.

Dated as of [                    ], 2014

TABLE OF CONTENTS

		Page
ARTICLE I DEFINITIONS AND INTERPRETATION			6
Section 1.1	General		6
Section 1.2	References; Interpretation		27
Section 1.3	Effective Date		27
Section 1.4	Tax Matters		27
Section 1.5	Employee Matters		27
Section 1.6	Transition Services Agreement		27
Section 1.7	Management Agreement.		27
ARTICLE II THE SEPARATION			28
Section 2.1	General		28
Section 2.2	Transfer of Assets		28
Section 2.3	Assumption and Satisfaction of Liabilities		28
Section 2.4	Intercompany Accounts		29
Section 2.5	Bank Accounts; Cash Balances		29
Section 2.6	Limitation of Liability		30
Section 2.7	Transfers Not Effected On or Prior to the Effective Time; Transfers Deemed Effective as of the Effective Time		31
Section 2.8	Conveyancing and Assumption Instruments		33
Section 2.9	Further Assurances		33
Section 2.10	Novation of Liabilities		34
Section 2.11	Guarantees		35
Section 2.12	Treatment of Shared Contracts.		35
Section 2.13	Disclaimers of Representations and Warranties		37
ARTICLE III CERTAIN ACTIONS PRIOR TO THE DISTRIBUTION			38
Section 3.1	Separation		38
Section 3.2	Directors		38
Section 3.3	Resignations		38
Section 3.4	Spinco Financings		38
Section 3.5	Ancillary Agreements		39
ARTICLE IV THE DISTRIBUTION			39
Section 4.1	Stock Dividends to Parent; Distribution		39
Section 4.2	Fractional Shares		39
Section 4.3	Unclaimed Shares or Cash		40
Section 4.4	Actions in Connection with the Distribution.		40
Section 4.5	Sole Discretion of Parent		41
Section 4.6	Conditions to the Distribution.		41
ARTICLE V CERTAIN COVENANTS			42
Section 5.1	Legal Names and Other Parties’ Trademarks		42
Section 5.2	Auditors and Audits; Annual and Quarterly Financial Statements and Accounting		43
Section 5.3	No Restrictions on Post-Closing Competitive Activities; Corporate Opportunities		45
Section 5.4	Certain Matters Relating to Parent’s Organizational Documents.		46
Section 5.5	Non-Solicitation.		47

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		Page
ARTICLE VI CONTINGENT AND UNALLOCATED LIABILITIES			47
Section 6.1	Unallocated Liabilities		47
Section 6.2	Payments		48
Section 6.3	Procedures to Determine Status of Liability		48
Section 6.4	Certain Case Allocation Matters		49
Section 6.5	Cooperation in Defense and Settlement.		49
ARTICLE VII RELEASES AND INDEMNIFICATION			50
Section 7.1	Release of Pre-Distribution Claims		50
Section 7.2	Indemnification by Parent		53
Section 7.3	Indemnification by Spinco		53
Section 7.4	Procedures for Indemnification		54
Section 7.5	Indemnification Payments		56
Section 7.6	Contribution		56
Section 7.7	Indemnification Obligations Net of Insurance Proceeds and Other Amounts on a Net-Tax Basis		57
Section 7.8	Additional Matters; Survival of Indemnities		57
ARTICLE VIII CONFIDENTIALITY; ACCESS TO INFORMATION			58
Section 8.1	Provision of Corporate Records		58
Section 8.2	Access to Information		58
Section 8.3	Witness Services		59
Section 8.4	Confidentiality		59
Section 8.5	Privileged Matters		60
Section 8.6	Reimbursement		62
Section 8.7	Ownership of Information		62
Section 8.8	Other Agreements		62
ARTICLE IX DISPUTE RESOLUTION			63
Section 9.1	Disputes		63
Section 9.2	Exclusive Remedy; Limitation on Actions		64
ARTICLE X INSURANCE			64
Section 10.1	Policies and Rights Included Within Assets		64
Section 10.2	Claims Made Tail Policies		64
Section 10.3	Occurrence Based Policies		66
Section 10.4	Claims-Made or Similarly Based Policies		66
Section 10.5	Administration; Other Matters.		66
Section 10.6	Agreement for Waiver of Conflict and Shared Defense		68
Section 10.7	Cooperation		68
Section 10.8	Miscellaneous.		68
ARTICLE XI MISCELLANEOUS			69
Section 11.1	Complete Agreement; Construction		69
Section 11.2	Ancillary Agreements		69
Section 11.3	Counterparts; Electronic Delivery		69
Section 11.4	Survival of Agreements		69
Section 11.5	Expenses		69
Section 11.6	Notices		70
Section 11.7	Waivers and Consents		70

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		Page
Section 11.8	Amendments		71
Section 11.9	Assignment		71
Section 11.10	Successors and Assigns		71
Section 11.11	Certain Termination and Amendment Rights		71
Section 11.12	Payment Terms		71
Section 11.13	No Circumvention		72
Section 11.14	Subsidiaries		72
Section 11.15	Third Party Beneficiaries		72
Section 11.16	Title and Headings		72
Section 11.17	Exhibits and Schedules		72
Section 11.18	Closing		72
Section 11.19	Governing Law		72
Section 11.20	Consent to Jurisdiction		73
Section 11.21	Specific Performance		73
Section 11.22	Waiver of Jury Trial		73
Section 11.23	Severability		73
Section 11.24	Force Majeure		73
Section 11.25	Interpretation		74
Section 11.26	Authorization		74

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Schedule 1.1(69)(v)	LDC Assets
Schedule 1.1(69)(vii)(A)	Assets Not Considered LDC Assets
Schedule 1.1(71)(vi)	LDC Contracts
Schedule 1.1(72)(i)	LDC Liabilities
Schedule 1.1(72)(v)	LDC Liabilities Related to Indebtedness
Schedule 1.1(72)(vi)	LDC Actions
Schedule 1.1(72)(vii)(A)	Liabilities Not Considered LDC Liabilities
Schedule 1.1(100)(v)	Retained Business Assets
Schedule 1.1(101)(vi)	Retained Business Contracts
Schedule 1.1(102)(i)	Retained Business Liabilities
Schedule 1.1(102)(v)	Retained Business Liabilities Related to Indebtedness
Schedule 1.1(102)(vi)	Retained Business Actions
Schedule 1.1(102)(vii)(A)	Liabilities Not Considered Retained Business Liabilities
Schedule 1.1(123)	Spinco Group
Schedule 2.4(b)	Intercompany Accounts to Remain Outstanding
Schedule 2.5(a)(i)	Spinco Accounts
Schedule 2.5(b)	Parent Accounts
Schedule 2.6(b)	Non-Terminated Intercompany Contracts
Schedule 2.12(a)	Allocation of Contracts
Schedule 4.6(f)	Regulatory Approvals
Schedule 11.5(a)(ii)	Allocation of Costs and Expenses
Schedule 11.5(b)	Advisors Whose Fees Are to be Paid by Parent
Exhibits
Exhibit A	Reorganization Actions
Exhibit B	Employee Matters Agreement
Exhibit C	Tax Matters Agreement
Exhibit D	Master Transition Services Agreement
Exhibit E	Management Agreement

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SEPARATION AND DISTRIBUTION AGREEMENT

SEPARATION AND DISTRIBUTION AGREEMENT (this “Agreement”), dated as of [                    ], 2014, by and between ONEOK, INC., an Oklahoma corporation (“Parent”) and ONE GAS, INC., an Oklahoma corporation (“Spinco”). Each of Parent and Spinco is sometimes referred to herein as a “Party” and collectively, as the “Parties”. Capitalized terms used herein and not otherwise defined shall have the respective meanings assigned to them in ARTICLE I.

R E C I T A L S:

WHEREAS, Parent, acting through various divisions and through its direct and indirect Subsidiaries, currently conducts a number of businesses, including (i) the LDC Business and (ii) the Retained Businesses;

WHEREAS, the board of directors of Parent (the “Parent Board”) has (i) determined that the Separation and the other transactions contemplated by this Agreement and the Ancillary Agreements are appropriate, desirable and in the best interests of Parent and its stockholders and (ii) approved this Agreement and each of the Ancillary Agreements;

WHEREAS, the Parent Board has determined that it is in the best interests of Parent and its stockholders to create a new publicly traded company that shall operate the LDC Business;

WHEREAS, Spinco has been incorporated for this purpose and has not engaged in activities except in preparation for its corporate reorganization (including activities with respect to the Spinco Financing Arrangements) and the distribution of its stock;

WHEREAS, in furtherance of the foregoing, the Parent Board has determined that it is appropriate and desirable for Parent to transfer the LDC Assets to Spinco and/or certain entities designated by Spinco that will be Subsidiaries of Spinco as of the Distribution Date and that are reasonably acceptable to Parent (any such entities, the “Spinco Designees”), and for Spinco and the Spinco Designees, if any, to assume the LDC Liabilities, in each case as more fully described in this Agreement and the Ancillary Agreements and, in exchange therefor, Spinco shall (i) issue to Parent all of the shares of its common stock, par value $0.01 per share (the “Spinco Common Stock”) and (ii) make the Separation Payment (the “Separation”);

WHEREAS, Spinco will issue and sell the Senior Indebtedness (the “Spinco Debt Financing”);

WHEREAS, Parent currently intends that, on the Distribution Date, Parent shall distribute to holders of shares of Parent Common Stock, through a spin-off, all of the outstanding shares of Spinco Common Stock, as more fully described in this Agreement and the Ancillary Agreements (the “Distribution”);

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WHEREAS, for U.S. federal income tax purposes, the Separation and the Distribution, if effected, taken together, are intended to qualify as a tax-free transaction under Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the “Code”);

WHEREAS, this Agreement is intended to be, and is hereby adopted as, a “plan of reorganization” within the meaning of Treas. Reg. 1.368-2(g); and

WHEREAS, it is appropriate and desirable to set forth the principal corporate transactions required to effect the Separation and the Distribution and certain other agreements that will govern certain matters relating to the Separation and the Distribution and the relationship of Parent, Spinco and their respective Subsidiaries, following the Distribution.

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements, provisions and covenants contained in this Agreement, the Parties hereby agree as follows:

ARTICLE I

DEFINITIONS AND INTERPRETATION

Section 1.1 General.

As used in this Agreement, the following terms shall have the following meanings:

(1) “2013 Internal Control Audit and Management Assessments” shall have the meaning set forth in Section 5.2(a)(i).

(2) “Action” shall mean any demand, action, claim, charge, suit, countersuit, arbitration, inquiry, subpoena, proceeding or investigation by or before any Governmental Entity or in any arbitration or mediation.

(3) “Affiliate” shall mean, when used with respect to a specified Person, a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such specified Person. For the purposes of this definition, “control”, when used with respect to any specified Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or other interests, by Contract or otherwise. It is expressly agreed that for purposes of this Agreement no Party or member of any Group shall be deemed to be an Affiliate of another Party or member of such other Party’s Group, including by reason of having one or more directors in common. For the purposes of this Agreement and for the avoidance of doubt, neither Spinco nor any member of the Spinco Group is an “Affiliate” of Parent or any member of the Parent Group; provided, however, that the Parties acknowledge that prior to the completion of the Separation and the Distribution, for regulatory purposes the Parties and their Subsidiaries are affiliates and that the Separation may be deemed to be an affiliated transaction and subject to any affiliated transaction statutes and regulations relating to the LDC Business.

(4) “Agreement” shall have the meaning set forth in the preamble hereto.

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(5) “Agreement Disputes” shall have the meaning set forth in Section 9.1(a).

(6) “Allocable Portion of Insurance Proceeds” shall have the meaning set forth in Section 10.5(c).

(7) “Allocated Percentage” shall mean the Spinco Percentage or the Parent Percentage, as the case may be.

(8) “Amended Financial Report” shall have the meaning set forth in Section 5.2(b).

(9) “Ancillary Agreements” shall mean all of the written Contracts, instruments, assignments or other arrangements (other than this Agreement) entered into in connection with the transactions contemplated hereby, including the Conveyancing and Assumption Instruments, the Employee Matters Agreement, the Tax Matters Agreement, the Transition Services Agreement and any Management Agreement.

(10) “Applicable Franchise Assets” shall mean, with respect to a particular Franchise Agreement, those LDC Assets located in the territory governed by, and used in order to perform the obligations, under such Franchise Agreement.

(11) “Applicable Franchise Liabilities” shall mean, with respect to a particular Franchise Agreement, those LDC Liabilities arising from or relating directly to the performance by the LDC Business of its obligations under such Franchise Agreement.

(12) “Assets” shall mean assets, properties, claims and rights (including goodwill), wherever located (including in the possession of vendors or other third parties or elsewhere), of every kind, character and description, whether real, personal or mixed, tangible, intangible or contingent, in each case whether or not recorded or reflected or required to be recorded or reflected on the Records or financial statements of any Person, including the following:

(i) all accounting and other legal and business books, records, ledgers and files whether printed, electronic or written;

(ii) pipelines, distribution facilities, storage facilities and associated assets;

(iii) all apparatuses, computers and other electronic data processing and communications equipment, fixtures, machinery, rolling stock, equipment, furniture, office equipment, automobiles, trucks, aircraft and other transportation equipment, special and general tools, test devices, molds, tooling, dies, prototypes and models and other tangible personal property;

(iv) all inventories of products (including natural gas inventories), works-in-process and finished goods, materials, parts, raw materials and supplies;

(v) all interests in and rights with respect to real property of whatever nature, including easements, whether as owner, mortgagee or holder of a Security Interest in real property, lessor, sublessor, lessee, sublessee or otherwise;

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(vi) all interests in any capital stock or other equity interests of any Subsidiary or any other Person, all bonds, notes, debentures or other securities issued by any Subsidiary or any other Person, all loans, advances or other extensions of credit or capital contributions to any Subsidiary or any other Person and all other investments in securities of any Person;

(vii) all Contracts, leases of personal property, open purchase orders for raw materials, supplies, parts or services, unfilled orders for the manufacture and sale of products and other Contracts or commitments;

(viii) all deposits, letters of credit and performance and surety bonds;

(ix) all written (including in electronic form) technical information, data, specifications, research and development information, engineering drawings and specifications, operating and maintenance manuals, and materials and analyses prepared by consultants and other third parties;

(x) all Intellectual Property;

(xi) all Software;

(xii) all cost information, sales and pricing data, customer prospect lists, supplier records, customer and supplier lists, customer and vendor data, correspondence and lists, product data and literature, artwork, design, development and business process files and data, vendor and customer drawings, specifications, quality records and reports and other books, records, studies, surveys, reports, plans and documents;

(xiii) all prepaid expenses, trade accounts and other accounts and notes receivable;

(xiv) all rights under Contracts, all claims or rights against any Person, choses in action or similar rights whether sounding in tort, contract or otherwise, whether accrued or contingent;

(xv) all rights under insurance policies and all rights in the nature of insurance, indemnification or contribution;

(xvi) all Permits;

(xvii) all cash or cash equivalents, bank accounts, brokerage accounts, lock boxes and other third-party deposit arrangements; and

(xviii) all interest rate, currency, commodity or other swap, collar, cap or other hedging or similar Contracts or arrangements.

(13) “Assume” shall have the meaning set forth in Section 2.3; and the terms “Assumed” and “Assumption” shall have their correlative meanings.

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(14) “Audited Party” shall have the meaning set forth in Section 5.2(a)(ii).

(15) “Benefit Plan” shall have the meaning set forth in the Employee Matters Agreement.

(16) “Business” shall mean any of the Retained Businesses or the LDC Business, as applicable.

(17) “Business Day” shall mean any day that is not a Saturday, a Sunday or any other day on which banks are required or authorized by Law to be closed in the city of Tulsa, Oklahoma or the City of New York, New York.

(18) “Business Entity” shall mean any corporation, partnership, limited liability company, joint venture, unincorporated association, trust for a business purpose, or other entity which may legally hold title to Assets.

(19) “Claims Administration” shall mean the processing of Insured Claims, including the reporting of claims to the insurance carriers, management and defense of claims and providing for appropriate releases upon settlement of claims.

(20) “Code” shall have the meaning set forth in the recitals hereto.

(21) “Commission” shall mean the United States Securities and Exchange Commission.

(22) “Confidential Information” shall mean any and all of the following information in written, oral, electronic or other tangible or intangible form, without regard to whether the information is subject to being copyrighted or patented:

(i) all information that is a trade secret under applicable trade secret or other Law or is required to be maintained in confidence by any Law or under any Contract;

(ii) all information concerning product specifications, data, know-how, formulae, compositions, processes, methodologies, designs, sketches, photographs, graphs, drawings, samples, models, inventions and ideas, improvements, past, current and planned research and development, current and planned manufacturing or distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer hardware, computer software (including all versions, source and object codes and all related files and data), software and database technologies, systems, structures and architectures, and other similar technical or business information;

(iii) all information concerning any Business and its affairs (which includes earnings reports and forecasts, macro-economic reports and forecasts, business and strategic plans, general market evaluations and surveys, litigation presentations and risk assessments, financing and credit-related information, financial projections, tax returns and accountants’ materials, historical, current and projected sales, capital spending budgets and plans, business plans, strategic plans, marketing and advertising

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plans, client and customer lists and files, Contracts, the names and backgrounds of key employees and personnel training techniques and materials, however documented, and other similar financial, business or employee information);

(iv) communications by or to attorneys (including attorney-client privileged communications), memos and other materials prepared by attorneys or under their direction (including attorney work product), communications and materials otherwise related to or made or prepared in connection with or in preparation for any legal proceeding; and

(v) all notes, analyses, compilations, studies, summaries and other material that contain or are based, in whole or in part, upon any information included in the foregoing subparts (i) – (iv).

(23) “Consents” shall mean any consents, waivers or approvals from, or notification requirements to, any Person, other than a Governmental Entity; provided, however, that for the purposes of this definition only, the counterparty to any Contract with the LDC Business, including any Franchise Agreement, in such capacity, shall not constitute a Governmental Entity.

(24) “Contingent Claim Committee” shall mean a committee that shall be established in accordance with Section 6.3.

(25) “Contingent Liability” shall mean any Liability, other than Liabilities for Taxes (which are governed by the Tax Matters Agreement) and Liabilities for any Benefit Plans (which are governed by the Employee Matters Agreement), of Parent or Spinco or any of their respective Affiliates, whenever arising, to any Person (unless that Person has released or the Liability to that Person is intended to be released under Section 7.1), if and to the extent that:

(i) such Liability has accrued as of the Effective Time (based on then existing Law); and

(ii) the existence or scope of the obligation of Spinco or Parent or any of their respective Affiliates as of the Effective Time with respect to such Liability was not acknowledged, fixed or determined due to a dispute or other uncertainty as of the Effective Time or as a result of the failure of such Liability to have been discovered or asserted as of the Effective Time (it being understood that the existence of any Action pending, threatened or contemplated or other reserve for accounting purposes as of the Effective Time with respect to any Liability shall not be sufficient for such Liability to be considered acknowledged, fixed or determined).

The Parties agree that no Liability relating to, arising out of or resulting from any obligation of any Person to perform the executory portion of any Contract existing as of the Effective Time shall be deemed to be a Contingent Liability.

(26) “Contract” shall mean any agreement, license, contract, obligation, indenture, instrument, lease, promise, arrangement, release, warranty, commitment or undertaking (whether written or oral and whether express or implied).

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(27) “Contribution Date” shall mean the date on which Parent Transfers the LDC Assets to Spinco pursuant to Section 2.2(a).

(28) “Conveyancing and Assumption Instruments” shall mean, collectively, the various written Contracts and other documents entered into and to be entered into to effect the Transfer of Assets and the Assumption of Liabilities in the manner contemplated by this Agreement, or otherwise relating to, arising out of or resulting from the transactions contemplated by this Agreement (other than the Tax Matters Agreement, the Employee Matters Agreement, the Transition Services Agreement and any Management Agreement).

(29) “Credit Agreement” shall mean the Credit Agreement, dated April 5, 2011, among ONEOK, Inc., as borrower, the lenders party thereto, Bank of America, N.A., as administrative agent, swing line lender, and a letter of credit issuer, and JPMorgan Chase Bank, N.A. and The Royal Bank of Scotland plc, as letter of credit, as amended by the First Amendment to Credit Agreement, dated as of March 28, 2013, among ONEOK, Inc., as borrower, the lenders party thereto, Bank of America, N.A., as administrative agent, swing line lender, and a letter of credit issuer, and JPMorgan Chase Bank, N.A. and The Royal Bank of Scotland plc, as letter of credit issuers.

(30) “Date of this Agreement” shall have the meaning set forth in the recitals.

(31) “D&O Tail Policies” shall have the meaning set forth in Section 10.2(a).

(32) “Disclosure Documents” shall mean the Form 10 and the Information Statement, and any prospectus, offering memorandum, offering circular or similar disclosure document or any marketing materials in each case, whether or not filed with the Commission or any other Governmental Entity, prepared in connection with the Spinco Financing Arrangements.

(33) “Dispute Notice” shall have the meaning set forth in Section 9.1(b).

(34) “Distribution” shall mean the distribution on the Distribution Date to holders of record of shares of Parent Common Stock as of the Distribution Record Date of the Spinco Common Stock owned by Parent on the basis of [                ] share of Spinco Common Stock for every [                ] outstanding shares of Parent Common Stock.

(35) “Distribution Agent” shall mean Wells Fargo Bank N.A., as distribution agent.

(36) “Distribution Date” shall mean the date on which Parent, through the Distribution Agent, distributes all of the issued and outstanding shares of Spinco Common Stock to the holders of Parent Common Stock.

(37) “Distribution Record Date” shall mean such date as may be determined by the Parent Board (or special committee thereof) as the record date for the Distribution.

(38) “Effective Time” shall mean 5:00 p.m., Central Standard Time, on the Distribution Date.

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(39) “Employee Matters Agreement” shall mean the Employee Matters Agreement by and among Parent and Spinco, dated as of the date hereof and substantially in the form attached as Exhibit B hereto, as such agreement may be modified or amended from time to time in accordance with its terms.

(40) “Energy Services Business” shall mean the business of providing wholesale natural gas supply and other related services for natural gas and electric utilities and commercial and industrial customers across the United States as conducted by Parent and its Subsidiaries.

(41) “Exchange Act” shall mean the Securities Exchange Act of 1934 and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time that reference is made thereto.

(42) “Fiduciary Tail Policies” shall have the meaning set forth in Section 10.2(b).

(43) “Force Majeure” shall mean, with respect to a Party, an event beyond the control of such Party (or any Person acting on its behalf), which by its nature could not have been reasonably foreseen by such Party (or such Person), or, if it could have been reasonably foreseen, was unavoidable, and includes acts of God, storms, floods, riots, labor unrest, pandemics, nuclear incidents, fires, sabotage, civil commotion or civil unrest, interference by civil or military authorities, acts of war (declared or undeclared) or armed hostilities or other national or international calamity or one or more acts of terrorism or failure of energy sources or distribution facilities.

(44) “Form 10” shall mean the registration statement on Form 10 filed by Spinco with the Commission in connection with the Distribution, including any amendments or supplements thereto.

(45) “Former Spinco Employee” shall have the meaning set forth in the Employee Matters Agreement.

(46) “Former Parent Employee” shall have the meaning set forth in the Employee Matters Agreement.

(47) “Franchise Agreement” shall mean any franchise or similar agreement in which one or more Governmental Entities grants rights to a utility relating to the distribution of natural gas.

(48) “Governmental Approvals” shall mean any notices or reports to be submitted to, or other filings to be made with, or any consents, registrations, approvals, permits or authorizations to be obtained from, any Governmental Entity; provided, however, that, no Consent required from any counterparty to any Contract, including any Franchise Agreement, shall constitute a Governmental Approval for the purposes of this Agreement.

(49) “Governmental Entity” shall mean any nation or government, any state, municipality or other political subdivision thereof and any entity, body, agency, commission, department, board, bureau or court, whether domestic, foreign or multinational, exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government; and any official thereof.

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(50) “GP” shall mean ONEOK Partners GP, L.L.C.

(51) “Group” shall mean the Parent Group or the Spinco Group, as the case may be.

(52) “Indebtedness” shall mean (i) any indebtedness for borrowed money or the deferred purchase price of property as evidenced by a note, bond or other instrument, (ii) obligations as lessee under capital leases, (iii) obligations secured by any mortgage, pledge, security interest, encumbrance, lien or charge of any kind existing on any Asset owned or held by any Person, whether or not such Person has assumed or become liable for the obligations secured thereby, (iv) any obligation under any interest rate swap agreement, (v) accounts payable, (vi) reimbursement obligations with respect to surety and performance bonds or letters of credit, and (vii) obligations under direct or indirect guarantees of (including obligations, contingent or otherwise, to assure a creditor against loss in respect of) indebtedness or obligations of the kinds referred to in clauses (i), (ii), (iii), (iv), (v) and (vi) above.

(53) “Indemnifiable Loss” and “Indemnifiable Losses” shall mean any and all damages, losses, deficiencies, Liabilities, obligations, penalties, judgments, settlements, claims, payments, fines, interest, costs and expenses (including internal costs provided for in Section 11.5(c) and the costs and expenses of any and all Actions and demands, assessments, judgments, settlements and compromises relating thereto and the reasonable costs and expenses of attorneys’, accountants’, consultants’ and other professionals’ fees and expenses incurred in the investigation or defense thereof or the enforcement of rights hereunder), excluding special, consequential, indirect, punitive damages (other than special, consequential, indirect and/or punitive damages awarded to any unaffiliated third party against an indemnified party).

(54) “Indemnifying Party” shall have the meaning set forth in Section 7.4(b).

(55) “Indemnitee” shall have the meaning set forth in Section 7.4(b).

(56) “Indemnity Payment” shall have the meaning set forth in Section 7.7(a).

(57) “Indentures” shall mean any indentures governing any outstanding senior notes issued by Parent.

(58) “Information Statement” shall mean the Information Statement initially attached as an exhibit to the Form 10 and sent to the holders of Parent Common Stock in connection with the Distribution, including any amendment or supplement thereto.

(59) “Insurance Administration” shall mean, with respect to each Shared Policy: (i) the accounting for premiums, retrospectively-rated premiums, defense costs, Indemnity Payments, deductibles and retentions, as appropriate, under the terms and conditions of each of the Shared Policies; (ii) the reporting to insurance carriers of any circumstances, incidents, occurrences, losses or claims which may cause the per-occurrence, per claim or aggregate limits of any Shared Policy to be exceeded, and (iii) the distribution of Insurance Proceeds as contemplated by this Agreement.

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(60) “Insurance Expenses” shall have the meaning set forth in Section 10.2(e).

(61) “Insurance Proceeds” shall mean those monies (i) received by an insured from an insurance carrier or (ii) paid by an insurance carrier on behalf of an insured, in either case net of any applicable premium adjustment, retrospectively-rated premium, deductible, retention, or cost of reserve paid or held by or for the benefit of such insured.

(62) “Insured Claims” shall mean those Liabilities that, individually or in the aggregate, are covered within the terms and conditions of any of the Shared Policies, whether or not subject to deductibles, co-insurance, uncollectability or retrospectively-rated premium adjustments.

(63) “Intellectual Property” shall mean all intellectual property and industrial property rights of any kind or nature, including all United States and foreign (i) patents, patent applications, patent disclosures, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, substitutions and extensions thereof, (ii) Trademarks, (iii) copyrights, whether statutory or common law, registered or unregistered and published or unpublished, (iv) rights of publicity, (v) moral rights and rights of attribution and integrity, (vi) rights in Software, (vii) trade secrets and all other Confidential Information, (viii) rights to personal information, (ix) rights, priorities and privileges arising under applicable Law in the foregoing and in other similar intangible Assets, (x) applications and registrations for the foregoing, and (xi) rights and remedies against past, present, and future infringement, misappropriation, or other violation of the foregoing.

(64) “Intercompany Accounts” shall mean any receivable, payable or loan between any member of one Group, on the one hand, and any member of the other Group, on the other hand that (a) exists immediately prior to the (i) Contribution Date or (ii) the Effective Time and (b) is reflected in the Records of the relevant members of such Groups, except for any such receivable, payable or loan that arises pursuant to this Agreement or any other Ancillary Agreement.

(65) “Kansas Approval” shall mean a Certificate and Order issued by the KCC consistent with the requests set forth in the “Application of ONEOK, Inc. for an Order Authorizing its Plan of Reorganization” filed with the KCC on August 16, 2013, as such application may have been or may be amended or supplemented from time to time.

(66) “KCC” shall mean the Kansas Corporation Commission.

(67) “Knowing Violation of Law” shall mean (i) in any context other than a criminal action, an intentional act or omission by a Person who is aware that the conduct is a violation of Law, and (ii) in the context of a criminal action, an intentional act or omission by a Person that violates a criminal Law unless that Person had no reasonable cause to believe that the conduct was a violation of criminal Law.

(68) “Law” shall mean any United States or non-United States federal, national, supranational, state, provincial, local or similar statute, law, ordinance, regulation, rule, code, order, requirement or rule of law (including common law and in equity).

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(69) “LDC Assets” shall mean:

(i) the ownership interests (to the extent held by Parent, Spinco, or any of their respective Affiliates immediately prior to the Effective Time) in each member of the Spinco Group other than shares of capital stock to be distributed in the Distribution;

(ii) all LDC Contracts, any rights or claims of Parent arising thereunder, and any other rights or claims or contingent rights or claims of Parent, Spinco, or any of their respective Affiliates, primarily relating to or arising from any other LDC Asset or the LDC Business; provided, however, that no rights belonging to ONEOK Energy Services Company, II or any of its Subsidiaries under any LDC Contract shall constitute an LDC Asset;

(iii) all Assets owned, leased or held by Parent, Spinco, or any of their respective Affiliates immediately prior to the Effective Time that are used primarily in the LDC Business, including inventory, accounts receivable, goodwill, facilities, and equipment;

(iv) subject to ARTICLE X, any rights of any member of the Spinco Group under any LDC Policies and any Shared Policies, to the extent primarily related to the LDC Business;

(v) the Assets listed or described on Schedule 1.1(69)(v) and any and all Assets that are expressly contemplated by this Agreement or any Ancillary Agreement as Assets to be retained by, or assigned or Transferred to, any member of the Spinco Group;

(vi) all of the capital stock of ONE Gas Properties, L.L.C.; and

(vii) all Spinco Accounts, and, subject to the provisions of Section 2.5, all cash, cash equivalents, and securities on deposit in such accounts immediately prior to the Effective Time.

Notwithstanding the foregoing, the LDC Assets shall not in any event include:

(A) the Assets listed or described on Schedule 1.1(69)(vii)(A);

(B) any Assets that are expressly contemplated by this Agreement or any Ancillary Agreement as Assets to be retained by or Transferred to, any member of the Parent Group; or

(C) any Assets of the GP, any Assets of the MLP or any of its Subsidiaries.

(70) “LDC Business” shall mean:

(i) the business segment of Parent, which conducts the natural-gas distribution business, which provides natural gas distribution services in Kansas, Oklahoma, and Texas through Kansas Gas Service, Oklahoma Natural Gas and Texas Gas Service, respectively;

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(ii) any other business, operations, or assets where such business was conducted primarily through the use of the LDC Assets immediately prior to the Effective Time; and

(iii) the businesses and operations of Business Entities acquired or established by or for any member of the Spinco Group after the Date of this Agreement; provided, however, the LDC Business shall not in any event include any operation, business or Asset expressly included in any of the Retained Businesses pursuant to this Agreement.

(71) “LDC Contracts” shall mean Parent’s rights, interests and obligations under the following Contracts to which Parent is a party or by which it or any of its Assets is bound, except for any such Contract or part thereof (i) that is expressly contemplated not to be Transferred by any member of the Parent Group to Spinco or (ii) that is expressly contemplated to be Transferred to (or remain with) any member of the Parent Group pursuant to any provision of this Agreement or any Ancillary Agreement:

(i) any Contract entered into in the name of, or expressly on behalf of, the LDC Business;

(ii) any Contract that relates primarily to the LDC Business;

(iii) any Contract representing capital or operating equipment lease obligations of facilities or equipment primarily used in the LDC Business;

(iv) any Contract or part thereof that is otherwise expressly contemplated pursuant to this Agreement or any of the Ancillary Agreements to be retained by, or Transferred to, any member of the Spinco Group;

(v) any guarantee, indemnity, representation or warranty of any member of the Spinco Group; and

(vi) the Contracts listed or described on Schedule 1.1(71)(vi).

(72) “LDC Liabilities” shall mean:

(i) the Liabilities listed or described on Schedule 1.1(72)(i) and any and all Liabilities that are expressly contemplated by this Agreement or any Ancillary Agreement as Liabilities to be retained or Assumed by any member of the Spinco Group;

(ii) any and all Liabilities of Parent, Spinco, or any of their respective Affiliates, primarily relating to, arising out of or resulting from:

(A) the operation or conduct of the LDC Business, as conducted at any time prior to, on or after the Effective Time (including any

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Liability relating to, arising out of or resulting from (x) any act or failure to act by any director, officer, employee, agent or representative of Parent, Spinco, or any of their respective Affiliates with respect to the LDC Business (whether or not such act or failure to act is or was within such Person’s authority) or (y) any obligation requiring the taking of or payment for natural gas);

(B) the operation or conduct of any business conducted by any member of the Spinco Group at any time after the Effective Time (including any Liability relating to, arising out of or resulting from any act or failure to act by any director, officer, employee, agent or representative of Spinco or any of its Affiliates after the Effective Time (whether or not such act or failure to act is or was within such Person’s authority)); or

(C) any LDC Business or any LDC Assets, whether arising before, on or after the Effective Time;

(iii) any and all Liabilities to the extent relating to, arising out of or resulting from any terminated, discontinued or divested Business Entity, business, real property, Asset or operation formerly and primarily owned or managed by, or associated with, any member of the Spinco Group or any LDC Business, provided that (x) any Liability related to, arising out of or resulting from a business or Assets Transferred to a member of the Parent Group, including, for the avoidance of doubt, the Retained Business Liabilities before the Effective Time and (y) any Liability arising out of or related to the sale of ONEOK Energy Marketing Company are excluded;

(iv) any and all Liabilities (including under applicable federal and state securities Laws) relating to, arising out of or resulting from:

(A) Disclosure Documents, including any and all Liabilities relating to, arising out of or resulting from any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, with respect to all information contained in any Disclosure Document, except to the extent set forth in Section 1.1(102);

(B) Any Pre-Separation Disclosure, but only to the extent such Liabilities arise out of or result from matters related to businesses, operations, Assets or Liabilities allocated to Spinco pursuant to this Agreement; or

(C) any Spinco Disclosure;

(v) any and all Liabilities, including those Liabilities listed on Schedule 1.1(72)(v), relating to, arising out of or resulting from any Indebtedness (including debt securities and asset-backed debt) of any member of the Spinco Group (whether incurred prior to, on or after the Effective Time), including any Liabilities relating to, arising out of or resulting from the Spinco Financing Arrangements;

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(vi) any and all Liabilities relating to, arising out of or resulting from any Action related to the LDC Business, including but not limited to those items listed or described on Schedule 1.1(72)(vi); and

(vii) any and all obligations of an insured Person under each LDC Policy and each Shared Policy to the extent related to or arising out of the LDC Business.

Notwithstanding the foregoing, the LDC Liabilities shall not in any event include:

(A) any Liabilities that are expressly contemplated by this Agreement or any Ancillary Agreement as Liabilities to be retained or Assumed by any member of the Parent Group, including any Liabilities set forth on Schedule 1.1(72)(vii)(A);

(B) any Liabilities related or attributable to, or arising in connection with, the employment, service, termination of employment or termination of service of Spinco Employees, which shall be exclusively governed by the Employee Matters Agreement; and

(C) any Liabilities related or attributable to, or arising in connection with, Taxes or Tax Returns, which shall be exclusively governed by the Tax Matters Agreement.

For the avoidance of doubt, no Liability shall be an LDC Liability solely as a result of Spinco or any other member of the Spinco Group being named as party to, or in, any Action.

(73) “LDC Policies” shall mean all Policies, current or past, which are owned or maintained by or on behalf of Parent or any Subsidiary of Parent, which relate exclusively to the LDC Business and which Policies are either maintained by Spinco or a member of the Spinco Group or assignable to Spinco or a member of the Spinco Group.

(74) “Liabilities” shall mean any and all debts, liabilities, costs, expenses, interest and obligations, whether accrued or fixed, absolute or contingent, matured or unmatured, reserved or unreserved, or determined or determinable of any kind or nature whatsoever, including those arising under or resulting from any Law or Action, whether asserted or unasserted, or order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Entity, and those arising under or resulting from any Contract or any fines, damages or equitable relief which may be imposed in connection with any of the foregoing and including all costs and expenses related thereto.

(75) “Liable Party” shall have the meaning set forth in Section 2.10(b).

(76) “Management Agreement” shall mean the Management Agreement by and among Parent and Spinco, dated as of the date hereof and substantially in the form attached as Exhibit E hereto.

(77) “MLP” shall mean ONEOK Partners, L.P., a Delaware limited partnership.

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(78) “Net-Tax Basis” shall have the meaning set forth in Section 7.7(c).

(79) “NYSE” shall mean the New York Stock Exchange.

(80) “Oklahoma Courts” shall have the meaning set forth in Section 11.20.

(81) “Other Party’s Auditor” shall have the meaning set forth in Section 5.2(a)(ii).

(82) “Other Party Marks” shall have the meaning set forth in Section 5.1(a).

(83) “Parent” shall have the meaning set forth in the preamble hereto.

(84) “Parent Accounts” shall have the meaning set forth in Section 2.5(a).

(85) “Parent Common Stock” shall mean the issued and outstanding shares of common stock, par value $0.01 per share, of Parent.

(86) “Parent Disclosure” shall mean any form, statement, schedule or other material (other than the Disclosure Documents) filed with or furnished to:

(A) the Commission,

(B) any other Governmental Entity, or

(C) holders of any securities of any member of the Parent Group,

on or after the Effective Time by or on behalf of any member of the Parent Group in connection with the registration, sale, or distribution of securities or disclosure related thereto (including periodic disclosure obligations).

(87) “Parent Employee” shall have the meaning set forth in the Employee Matters Agreement.

(88) “Parent Group” shall mean Parent and each Person (other than any member of the Spinco Group) that is a Subsidiary of Parent immediately after the Effective Time, and each Business Entity that becomes a Subsidiary of Parent after the Effective Time.

(89) “Parent Indemnitees” shall mean Parent, each member of the Parent Group, each of their respective directors, officers, employees and agents and each of the heirs, executors, successors and assigns of any of the foregoing, except the Spinco Indemnitees.

(90) “Parent Percentage” shall mean 85%.

(91) “Party” and “Parties” shall have the meaning set forth in the preamble hereof.

(92) “Permits” shall mean all permits (including any permits issued by any railroad authority), licenses, franchises, authorizations, concessions, certificates, consents, exemptions, approvals, variances, registrations or similar authorizations from any Governmental Authority.

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(93) “Person” shall mean any natural person, firm, individual, corporation, business trust, joint venture, association, company, limited liability company, partnership or other organization or entity, whether incorporated or unincorporated, or any Governmental Entity.

(94) “Policies” shall mean insurance policies and insurance Contracts of any kind (other than life and benefits policies or Contracts), including primary, excess and umbrella policies, general liability policies, punitive damages liability, control of well, railroad protective liability, cyber liability, director and officer liability, fiduciary liability, automobile, aircraft, property, terrorism, business interruption, workers’ compensation and employee dishonesty insurance policies, surety bonds and captive insurance company arrangements, together with the rights, benefits and privileges thereunder.

(95) “Pre-Separation Disclosure” shall mean any form, statement, schedule or other material (other than the Disclosure Documents) filed with or furnished to:

(A) the Commission,

(B) any other Governmental Entity, or

(C) holders of any securities of Parent or any of its Affiliates,

prior to the Effective Time by Parent, Spinco, or any of their respective Affiliates, in connection with the registration, sale, or distribution of securities or disclosure related thereto (including periodic disclosure obligations).

(96) “Prime Rate” shall mean the rate per annum publicly announced by JP Morgan Chase Bank (or successor thereto) from time to time as its prime rate in effect at its principal office in New York City or as published by The Wall Street Journal. For purposes of this Agreement, any change in the Prime Rate shall be effective on the date such change in the Prime Rate is publicly announced as effective.

(97) “Records” shall mean any Contracts, documents, books, records or files.

(98) “Related Persons” shall have the meaning set forth in Section 7.1(a).

(99) “Retained Businesses” shall mean:

(i) the ownership of the equity interests in the GP and its general partner interest in the MLP and, as general partner of the MLP, management of the MLP business, and the ownership of units representing limited partner interests in the MLP;

(ii) the Energy Services Business;

(iii) any other business, operations, or Assets where such business was conducted primarily through the use of the Retained Business Assets prior to the Effective Time; and

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(iv) the businesses and operations of Business Entities acquired or established by or for any member of the Parent Group after the Date of this Agreement;

provided, however, the Retained Businesses shall not in any event include any operation, business or Asset expressly included in the LDC Business pursuant to this Agreement.

(100) “Retained Business Assets” shall mean any Asset owned, leased or held by Parent, Spinco or any of their respective Affiliates immediately prior to the Effective Time that is not an LDC Asset, and shall include:

(i) the ownership interests (to the extent held by Parent, Spinco, or any of their respective Affiliates immediately prior to the Effective Time) in each member of the Parent Group, including the GP, ONEOK Leasing Company and ONEOK Parking Company, L.L.C.;

(ii) all Retained Business Contracts, any rights or claims of Parent, Spinco, or any of their respective Affiliates, arising thereunder, and any other rights or claims or contingent rights or claims of Parent, Spinco, or any of their respective Affiliates, primarily relating to or arising from any other Retained Business Asset or any Retained Business;

(iii) all Assets owned, leased or held by Parent, Spinco, or any of their respective Affiliates immediately prior to the Effective Time that are used primarily in any Retained Business, including inventory, accounts receivable, goodwill, facilities, and equipment;

(iv) subject to ARTICLE X, any rights of any member of the Parent Group under any Retained Business Policies or Shared Policies, to the extent related to any Retained Business;

(v) the ONEOK Plaza office building located in Tulsa, Oklahoma; the name “ONEOK” and the diamond logo registered by Parent and any derivatives thereof; the Assets listed or described on Schedule 1.1(100)(v) and any and all Assets that are expressly contemplated by this Agreement or any Ancillary Agreement as Assets to be retained by, or assigned or Transferred to, any member of the Parent Group;

(vi) all Parent Accounts, and, subject to the provisions of Section 2.5, all cash, cash equivalents, and securities on deposit in such accounts immediately prior to the Effective Time; and

(vii) any collateral securing any Retained Business Liability immediately prior to the Effective Time.

Notwithstanding the foregoing, the Retained Business Assets shall not include any Assets that are expressly contemplated by this Agreement or any Ancillary Agreement as Assets to be retained by, or assigned or Transferred to, any member of the Spinco Group.

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(101) “Retained Business Contracts” shall mean the following Contracts to which Parent or any of its Affiliates is a party or by which it or any of its Affiliates or any of their respective Assets is bound, except for any such Contract or part thereof that is expressly contemplated to be Transferred or assigned to (or remain with) any member of the Spinco Group pursuant to any provision of this Agreement or any Ancillary Agreement:

(i) any Contract entered into in the name of, or expressly on behalf of, any division, business unit or member of the Parent Group;

(ii) any Contract that relates primarily to any Retained Businesses;

(iii) any Contract representing capital or operating equipment lease obligations of facilities or equipment primarily used by any member of the Parent Group;

(iv) any Contract or part thereof that is otherwise expressly contemplated pursuant to this Agreement or any of the Ancillary Agreements to be retained by or Transferred to, any member of the Parent Group;

(v) any guarantee, indemnity, representation or warranty of any member of the Parent Group; and

(vi) the Contracts listed or described on Schedule 1.1(101)(vi).

(102) “Retained Business Liabilities” shall mean:

(i) the Liabilities listed or described on Schedule 1.1(102)(i) and any and all Liabilities that are expressly contemplated by this Agreement or any Ancillary Agreement as Liabilities to be retained or Assumed by any member of the Parent Group;

(ii) any and all Liabilities of Parent, Spinco, or any of their respective Affiliates, primarily relating to, arising out of or resulting from:

(A) the operation or conduct of any Retained Business, as conducted at any time prior to, on or after the Effective Time (including any Liability relating to, arising out of or resulting from any act or failure to act by any director, officer, employee, agent or representative of Parent, Spinco, or any of their respective Affiliates with respect to any Retained Business (whether or not such act or failure to act is or was within such Person’s authority));

(B) the operation or conduct of any business conducted by any member of the Parent Group at any time after the Effective Time (including any Liability relating to, arising out of or resulting from any act or failure to act by any director, officer, employee, agent or representative of Parent or any of its Affiliates after the Effective Time (whether or not such act or failure to act is or was within such Person’s authority)); provided, however, the foregoing shall not apply to any liability addressed by the Management Agreement; or

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(C) any Retained Business or any Retained Business Assets, whether arising before, on or after the Effective Time;

(iii) any and all Liabilities to the extent relating to, arising out of or resulting from any terminated, discontinued or divested Business Entity, business, real property, Asset or operation formerly and primarily owned or managed by any member of the Parent Group or any Retained Business, provided that any Liability related to, arising out of or resulting from a business or Assets Transferred to a member of the Spinco Group, including, for the avoidance of doubt, the LDC Liabilities, before the Effective Time is excluded;

(iv) any and all Liabilities (including under applicable federal and state securities Laws) relating to, arising out of or resulting from:

(A) any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading with respect to any information contained in any Disclosure Document but only to the extent such Liability derives from a misstatement or omission contained in the transmittal letter for the Information Statement from John W. Gibson to the Parent Stockholders and the sections of the Form 10 and the Information Statement entitled “Compensation Discussion and Analysis,” “The Separation” and “Certain Relationships and Related Party Transactions – Agreements with ONEOK” and the section entitled “Summary,” to the extent such section summarizes the other sections set forth in this paragraph;

(B) any Pre-Separation Disclosure, but only to the extent such Liabilities arise out of, or result from, matters related to businesses, operations, Assets or Liabilities allocated to Parent pursuant to this Agreement; or

(C) any Parent Disclosure;

(v) any and all Liabilities, including those Liabilities listed on Schedule 1.1(102)(v), relating to, arising out of or resulting from any Indebtedness (including debt securities and asset-backed debt) of any member of the Parent Group (whether incurred prior to, on or after the Effective Time);

(vi) any and all Liabilities relating to, arising out of or resulting from any Action related to any Retained Business, including but not limited to those items listed or described on Schedule 1.1(102)(vi); and

(vii) any and all obligations of an insured Person under each Retained Business Policy and each Shared Policy to the extent related to or arising out of any Retained Business.

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Notwithstanding the foregoing, the Retained Business Liabilities shall not include:

(A) any Liabilities that are expressly contemplated by this Agreement or any Ancillary Agreement as Liabilities to be retained or Assumed by any member of the Spinco Group, including any Liabilities set forth on Schedule 1.1(102)(vii)(A);

(B) any Liabilities related or attributable to, or arising in connection with, the employment, service, termination of employment or termination of service of Parent Employees, which shall be exclusively governed by the Employee Matters Agreement; and

(C) any Liabilities related or attributable to, or arising in connection with, Taxes or Tax Returns, which shall be exclusively governed by the Tax Matters Agreement.

For the avoidance of doubt, no Liability shall be a Retained Business Liability solely as a result of Parent or any other member of the Parent Group being named as party to, or in, any Action.

(103) “Retained Business Policies” shall mean all Policies, current or past, which are owned or maintained by or on behalf of Parent or any Subsidiary of Parent, which relate exclusively to any Retained Business and which Policies are either maintained by Parent or a member of the Parent Group or assignable to Parent or a member of the Parent Group.

(104) “Revolving Credit Facility” shall mean a revolving credit facility pursuant to a revolving credit facility agreement entered into prior to the Distribution by Spinco, as borrower, the bank named therein as administrative agent, and the lending banks named therein, on such terms and conditions as agreed to by Spinco and the other parties to the revolving credit facility agreement and approved by Parent.

(105) “Schedules” shall mean the schedules referenced in this Agreement and listed in the Table of Contents.

(106) “Securities Act” shall mean the Securities Act of 1933 and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time that reference is made thereto.

(107) “Security Interest” shall mean any mortgage, security interest, pledge, lien, charge, claim, option, right to acquire, voting or other restriction, right-of-way, covenant, condition, easement, encroachment, restriction on transfer, or other encumbrance of any nature whatsoever, excluding restrictions on transfer under securities Laws.

(108) “Senior Indebtedness” shall mean the Indebtedness issued in the Spinco Debt Financing, as may be amended, modified, restated or replaced at any time.

(109) “Senior Manager” shall mean the general counsel, chief financial officer, chief operating officer or chief executive officer of either Party.

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(110) “Separation” shall have the meaning set forth in the recitals hereto.

(111) “Separation Payment” shall have the meaning set forth in Section 3.4(b).

(112) “Shared Contract” shall have the meaning set forth in Section 2.12(a).

(113) “Shared Policies” shall mean all Policies, current or past, which are owned or maintained by or on behalf of Parent or any of its Subsidiaries which relate to any Retained Business and the LDC Business.

(114) “Software” shall mean all computer programs (whether in source code, object code, or other form), algorithms, databases, compilations and data, and technology supporting the foregoing, and all documentation, including flowcharts and other logic and design diagrams, technical, functional and other specifications, and user and training materials related to any of the foregoing.

(115) “Spin Agreements” shall have the meaning set forth in Section 2.13(a).

(116) “Spinco” shall have the meaning set forth in the preamble hereto.

(117) “Spinco Accounts” shall have the meaning set forth in Section 2.5(a).

(118) “Spinco Common Stock” shall have the meaning set forth in the recitals hereto.

(119) “Spinco Debt Financing” shall have the meaning set forth in the recitals hereto.

(120) “Spinco Disclosure” shall mean any form, statement, schedule or other material (other than the Disclosure Documents) filed with or furnished to:

(A) the Commission,

(B) any other Governmental Entity, or

(C) holders of any securities of any member of the Spinco Group,

on or after the Effective Time by or on behalf of any member of the Spinco Group in connection with the registration, sale, or distribution of securities or disclosure related thereto (including periodic disclosure or reporting obligations).

(121) “Spinco Employee” shall have the meaning set forth in the Employee Matters Agreement.

(122) “Spinco Financing Arrangements” shall mean the Spinco Debt Financing and the Revolving Credit Facility.

(123) “Spinco Group” shall mean Spinco and each Person (other than any member of the Parent Group) that is a Subsidiary of Spinco at the Effective Time, and each Person that becomes a Subsidiary of Spinco after the Effective Time, which shall include those entities identified as such on Schedule 1.1(123).

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(124) “Spinco Indemnitees” shall mean each member of the Spinco Group and each of their Affiliates and each member of the Spinco Group’s and their respective Affiliates’ respective directors, officers, employees and agents and each of the heirs, executors, successors and assigns of any of the foregoing.

(125) “Spinco Percentage” shall mean 15%.

(126) “Subsidiary” shall mean (i) for Parent, a wholly-owned Affiliate that Parent controls, (ii) for Spinco, a wholly-owned Affiliate that Spinco controls, (iii) for any other Person, a Business Entity that Person controls or in which that Person owns or has the benefit of more than 50% of the Business Entity’s equity economic interest. For the purposes of this definition, “control,” when used with respect to a specified Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or other interests, by Contract or otherwise. No Party or member of any Group shall be deemed to be an Affiliate of another Party or member of such other Party’s Group, including by reason of having one or more directors in common. Notwithstanding anything in this Agreement to the contrary, neither the MLP nor any of its Subsidiaries shall be deemed to be a Subsidiary of Parent or any of its Subsidiaries.

(127) “Tax” shall have the meaning set forth in the Tax Matters Agreement.

(128) “Tax Matters Agreement” shall mean the Tax Matters Agreement, by and among Parent and Spinco, dated as of the date hereof, and substantially in the form attached as Exhibit C hereto, as such agreement may be modified or amended from time to time in accordance with its terms.

(129) “Tax Return” shall have the meaning set forth in the Tax Matters Agreement.

(130) “Third Party Claim” shall have the meaning set forth in Section 7.4(b).

(131) “Third Party Proceeds” shall have the meaning set forth in Section 7.7(a).

(132) “Trademarks” shall mean all United States and foreign trademarks, service marks, corporate names, trade names, domain names, logos, slogans, designs, trade dress and other similar identifiers of source or origin, whether registered or unregistered, together with the goodwill connected with the use of and symbolized by any of the foregoing.

(133) “Transfer” shall have the meaning set forth in Section 2.2(a); and the term “Transferred” shall have its correlative meaning.

(134) “Transition Services Agreement” shall mean the Master Transition Services Agreement by and among Parent and Spinco, dated as of the date hereof, and substantially in the form attached as Exhibit D hereto, as such agreement may be modified or amended from time to time in accordance with its terms.

(135) “Unallocated Liability” shall mean, without duplication, any Liability of Spinco or Parent or any of their respective Affiliates, that accrues prior to the Effective Time that is not an LDC Liability or a Retained Business Liability.

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Section 1.2 References; Interpretation. References in this Agreement to any gender include references to all genders, and references to the singular include references to the plural and vice versa. Unless the context otherwise requires:

(i) the words “include”, “includes” and “including” when in this Agreement shall be deemed to be followed by the phrase “without limitation”;

(ii) references in this Agreement to Articles, Sections, Annexes, Exhibits and Schedules shall be deemed references to Articles and Sections of, and Annexes, Exhibits and Schedules to, this Agreement;

(iii) the words “hereof”, “hereby” and “herein” and words of similar meaning when used in this Agreement refer to this Agreement in its entirety and not to any particular Article, Section or provision of this Agreement.

Section 1.3 Effective Date. This Agreement shall be effective as of the Date of this Agreement.

Section 1.4 Tax Matters. The Tax Matters Agreement will govern each of the Parties’ respective rights, responsibilities and obligations after the Effective Time with respect to Taxes, including ordinary course of business Taxes and Taxes, if any, incurred as a result of any failure of the Distribution to qualify as a tax-free distribution for U.S. federal income tax purposes. The Tax Matters Agreement sets forth the respective obligations of each of the Parties with respect to the filing of Tax Returns, the administration of Tax contests, cooperation, access to information and provision of corporate Records with respect to such matters, and certain other matters, and imposes certain restrictions on each of the Parties’ ability to engage in certain actions following the Effective Time. Except as expressly set forth in this Agreement or any Ancillary Agreement, all matters relating to Taxes in connection with the transactions contemplated by this Agreement shall be governed exclusively by the Tax Matters Agreement.

Section 1.5 Employee Matters. The Employee Matters Agreement will govern each of the Parties’ respective rights, responsibilities and obligations after the Effective Time relating to, arising out of, or resulting from the employment, service, termination of employment or termination of service of Parent Employees and Spinco Employees, including with respect to access to information and provision of corporate Records with respect to such matters. Except as expressly set forth in this Agreement or any Ancillary Agreement, all matters relating to the above in connection with the transactions contemplated by this Agreement shall be governed exclusively by the Employee Matters Agreement.

Section 1.6 Transition Services Agreement. The Transition Services Agreement will govern each of the Parties’, or such Parties’ Affiliates, respective rights, responsibilities and obligations after the Effective Time relating to, arising of, or resulting from shared services or common uses of facilities and equipment that will continue for a transitional period after the Effective Time.

Section 1.7 Management Agreement. In the event that a Management Agreement is entered into pursuant to Section 2.7, with respect to a particular Franchise Agreement, such Management Agreement will govern each of the Parties’, or such Parties’

Affiliates, respective rights, responsibilities and obligations after the Effective Time relating to, arising out of, or resulting from the management of such Franchise Agreement.

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ARTICLE II

THE SEPARATION

Section 2.1 General. Subject to the terms and conditions of this Agreement, including Section 4.5, the Parties shall use, and shall cause their respective Affiliates to use, their respective commercially reasonable efforts to consummate the transactions contemplated hereby, a portion of which have already been implemented prior to the date hereof. It is the intent of the Parties that prior to consummation of the Separation, Parent and Spinco and each of their respective Affiliates, shall be reorganized, to the extent necessary, such that following the consummation of such Separation, subject to Section 2.7, (i) all of Parent’s and its Subsidiaries’ right, title and interest in and to the LDC Assets will be owned or held by a member of the Spinco Group, the LDC Business will be conducted by the members of the Spinco Group and all of the LDC Liabilities will be Assumed directly or indirectly by (or retained by) a member of the Spinco Group, (ii) all of Parent’s and its Subsidiaries’ right, title and interest in and to the Retained Business Assets will be owned or held by a member of the Parent Group, the Retained Businesses will be conducted by the members of the Parent Group and all of the Retained Business Liabilities will be Assumed directly or indirectly by (or retained by) a member of the Parent Group.

Section 2.2 Transfer of Assets.

(a) On or prior to the Effective Time and to the extent not already completed (and it being understood that some of such Transfers may occur following the Effective Time and prior to the Effective Time in accordance with Section 2.7), pursuant to the Conveyancing and Assumption Instruments, Parent shall, and shall cause the other members of the Parent Group to, as applicable, transfer, contribute, assign, distribute, and convey or cause to be transferred, contributed, assigned, distributed, and conveyed (“Transfer”) to Spinco or a Spinco Designee all of its and its Subsidiaries’ right, title and interest in and to the LDC Assets and, in exchange, Spinco shall (x) issue to Parent all of the shares of Spinco Common Stock and (y) make the Separation Payment.

(b) Unless otherwise agreed to by the Parties, each of Parent and Spinco, as applicable, shall be entitled to designate the Business Entity within such Party’s respective Group to which any Assets are to be Transferred pursuant to this Section 2.2 or Section 2.7; provided that any Business Entity designated by Spinco must be reasonably acceptable to Parent.

(c) The Parties shall cooperate and use their commercially reasonable efforts to obtain any required Consents or Governmental Approvals to Transfer any Assets, Contracts, Permits and authorizations issued by any Governmental Entity or parts thereof as contemplated by this Agreement.

Section 2.3 Assumption and Satisfaction of Liabilities. Except as otherwise specifically set forth in any Ancillary Agreement, from and after the Effective Time, (a) Parent

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shall, or shall cause another member of the Parent Group to, accept, assume (or, as applicable, retain) and perform, discharge and fulfill, in accordance with their respective terms (“Assume”), all of the Retained Business Liabilities and the Parent Percentage of any Unallocated Liability and (b) Spinco shall, or shall cause another member of the Spinco Group reasonably acceptable to Parent to, Assume all the LDC Liabilities and the Spinco Percentage of any Unallocated Liability; in each case, regardless of (i) when or where such Liabilities arose or arise, (ii) whether the facts upon which they are based occurred prior to, on or subsequent to the Effective Time, (iii) where or against whom such Liabilities are asserted or determined or (iv) whether arising from or alleged to arise from negligence, gross negligence, recklessness, violation of Law, willful misconduct, bad faith, fraud or misrepresentation by any member of the Parent Group or the Spinco Group, as the case may be, or any of their past or present respective directors, officers, employees, agents, Subsidiaries or Affiliates.

Section 2.4 Intercompany Accounts.

(a) Each Intercompany Account outstanding on the Contribution Date and each Intercompany Account outstanding immediately prior to the Effective Time, in any general ledger account of Parent or Spinco or any of their respective Affiliates, other than those set forth on Schedule 2.4(b), shall be satisfied and/or settled by the relevant members of the Spinco Group or the Parent Group no later than the Contribution Date immediately prior to the contribution of the LDC Assets to Spinco or the Effective Time, as the case may be. In the case of Intercompany Accounts settled prior to the Contribution Date, such Intercompany Accounts shall be settled by (x) forgiveness by the relevant obligor, (y) one or a related series of distributions of and/or contributions to capital, or (z) cash payment by the relevant obligor to the relevant obligee, in each case as determined by Parent. Each Party acknowledges and agrees that the settlement of such Intercompany Accounts are intended to be disregarded for U.S. federal and state income tax purposes. In the case of Intercompany Accounts settled immediately prior to the Effective Time, such Intercompany Accounts shall be settled by means of a capital contribution of such Intercompany Accounts by Parent to Spinco. Each Party acknowledges and agrees that the Intercompany Accounts that are created between the Contribution Date and the Effective Time between Parent and Spinco do not represent indebtedness for U.S. federal income tax purposes. Each Party further acknowledges and agrees that it will take no position inconsistent with the foregoing tax treatment on any Tax Return, in any audit or other proceeding or otherwise. To facilitate settlement by the Contribution Date or the Effective Time, as the case may be, the amount satisfied may include estimated amounts. Any estimates will be trued up and settled by the affected Parties not later than 90 days after the Contribution Date or the Effective Time, as the case may be. For the avoidance of doubt, any Intercompany Account relating to liability for Taxes shall be exclusively governed by the Tax Matters Agreement.

(b) Each Intercompany Account outstanding immediately prior to the Contribution Date and each Intercompany Account outstanding immediately prior to the Effective Time under any of the general ledger accounts of Parent or Spinco or any of their respective Affiliates, set forth on Schedule 2.4(b) shall continue to be outstanding after the Contribution Date or the Effective Time, as the case may be, (unless previously satisfied in accordance with its terms) and thereafter (x) shall be an obligation of the relevant Party (or the relevant member of such Party’s Group), each responsible for fulfilling its obligations in accordance with the terms and conditions applicable to such obligation, and (y) shall be for each relevant Party (or the relevant member of such Party’s Group) an obligation to a third-party and shall no longer be an Intercompany Account.

Section 2.5 Bank Accounts; Cash Balances.

(a) The Parties agree to take, or cause the respective members of their respective Groups to take, at the Effective Time (or such earlier time as the Parties may agree), all

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actions necessary to amend all Contracts governing each bank and brokerage account owned by Spinco or any other member of the Spinco Group, (including all Spinco accounts listed or described on Schedule 2.5(a)(i), the “Spinco Accounts”) so that such Spinco Accounts, if currently linked (whether by automatic withdrawal, automatic deposit, or any other authorization to transfer funds from or to, hereinafter “linked”) to any bank or brokerage account owned by Parent or any other member of the Parent Group (which subset of Parent accounts are listed or described on Schedule 2.5(b), the “Parent Accounts”) are de-linked from the Parent Accounts. From and after the Effective Time, no Parent Employee or Former Parent Employee shall have any authority to access or control any Spinco Account, except as provided for through the Transition Services Agreement.

(b) The Parties agree to take, or cause the respective members of their respective Groups to take, at the Effective Time (or such earlier time as the Parties may agree), all actions necessary to amend all Contracts governing the Parent Accounts so that such Parent Accounts, if currently linked to a Spinco Account, are de-linked from the Spinco Accounts. From and after the Effective Time, no Spinco Employee or Former Spinco Employee shall have any authority to access or control any Parent Account.

(c) With respect to any outstanding checks issued by the Parties, or any of their respective Subsidiaries prior to the Effective Time, such outstanding checks shall be honored following the Effective Time by the entity or Group owning the account on which the check is drawn.

(d) As between the Parties (and the members of their respective Groups) all payments and reimbursements received after the Effective Time by any Party (or member of its Group) that relate to a Business, Asset or Liability of another Party (or member of its Group), shall be held by such Party in trust for the use and benefit of the Party entitled thereto (at the expense of the Party entitled thereto) and, promptly upon receipt by such Party of any such payment or reimbursement, such Party shall pay over, or shall cause the applicable member of its Group to pay over, to the applicable Party the amount of such payment or reimbursement without right of set-off.

Section 2.6 Limitation of Liability.

(a) Except as otherwise expressly provided in this Agreement or in the case of any Knowing Violation of Law, fraud or intentional misrepresentation, no Party or any member of such Party’s Group shall have any Liability to any other Party or any member of such other Party’s Group in the event that any information exchanged or provided pursuant to this Agreement (but excluding any such information included in a Disclosure Document) which is an estimate or forecast, or which is based on an estimate or forecast, is found to be inaccurate.

(b) Except as provided in Section 2.4 (Intercompany Accounts), or as set forth in subsection (c) below, (i) no Party or any member of such Party’s Group shall have any Liability to any other Party or any member of such other Party’s Group based upon, arising out of or resulting from any Contract, arrangement, course of dealing or understanding with such other Party or its Group member existing on or prior to the Effective Time (other than this Agreement or any Ancillary Agreement or any Contract entered into in connection herewith or in order to

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consummate the transactions contemplated hereby or thereby) and (ii) each Party hereby terminates, and shall cause all members in its Group to terminate, any and all Contracts, arrangements, courses of dealing or understandings between it or any members in its Group and the other Party or Parties and members of their respective Groups effective as of the Effective Time (other than this Agreement or any Ancillary Agreement or any Contract entered into in connection herewith or in order to consummate the transactions contemplated hereby or thereby), unless such Contract, arrangement, course of dealing or understanding is set forth in any Ancillary Agreement or on Schedule 2.6(b), and any such Liability, whether or not in writing, which is not reflected in any Ancillary Agreement or on such Schedule, is hereby irrevocably cancelled, released and waived effective as of the Effective Time. No such terminated Contract, arrangement, course of dealing or understanding (including any provision thereof which purports to survive termination) shall be of any further force or effect after the Effective Time.

(c) The provisions of Section 2.6(b) shall not apply to (i) any Contracts to which any Person other than the Parties and their respective Affiliates is a party (it being understood that to the extent that the rights and obligations of the Parties and the members of their respective Groups under any such Contracts constitute LDC Assets or LDC Liabilities or Retained Business Assets or Retained Business Liabilities, such Contracts shall be assigned or retained pursuant to this ARTICLE II), (ii) any Contracts with ONEOK Energy Services Company II or the MLP or any of their respective Subsidiaries that remain in place after the Effective Time or, (iii) any Shared Contracts.

Section 2.7 Transfers Not Effected On or Prior to the Effective Time; Transfers Deemed Effective as of the Effective Time.

(a) To the extent that any Transfers contemplated by this ARTICLE II shall not have been consummated on or prior to the Effective Time, the Parties shall use commercially reasonable efforts to effect such Transfers as promptly following the Effective Time as shall be practicable. Nothing herein shall be deemed to require the Transfer of any Assets or the Assumption of any Liabilities that by their terms or operation of Law cannot be Transferred; provided, however, that the Parties shall, and shall cause the respective members of their Groups to, cooperate and use commercially reasonable efforts to seek to obtain any necessary Consents or Governmental Approvals for the Transfer of all Assets and Assumption of all Liabilities contemplated to be Transferred or Assumed pursuant to this ARTICLE II. In the event that any such Transfer of Assets or Assumption of Liabilities has not been consummated from and after the Effective Time (i) the Party (or relevant member in its Group) retaining such Asset shall thereafter hold (or shall cause such member in its Group to hold) such Asset for the use and benefit of the applicable Party (or relevant member in its Group) entitled thereto (at the expense of the Person entitled thereto) and (ii) the Party intended to Assume such Liability shall, or shall cause the applicable member of its Group to, pay or reimburse the Party (or the relevant member of its Group) retaining such Liability for all amounts paid or incurred in connection with the retention of such Liability. In addition, the Party retaining such Asset or Liability (or relevant member of its Group) shall (or shall cause such member in its Group to), insofar as reasonably possible and to the extent permitted by applicable Law, treat such Asset or Liability in the ordinary course of business in accordance with past practice and take such other actions as may

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be reasonably requested by the Party to which such Asset is to be Transferred or by the Party Assuming such Liability in order to place such Party, insofar as reasonably possible, in the same position as if such Asset or Liability had been Transferred or Assumed as contemplated hereby and so that all the benefits and burdens relating to such Asset or Liability, including possession, use, risk of loss, potential for gain, and dominion, control and command over such Asset or Liability, are to inure from and after the Effective Time to the relevant member of the Parent Group or the Spinco Group, as the case may be, entitled to the receipt of such Asset or required to Assume such Liability. In furtherance of the foregoing, the Parties agree that, as of the Effective Time, each Party shall be deemed to have acquired complete and sole beneficial ownership over all of the Assets, together with all rights, powers and privileges incident thereto, and shall be deemed to have Assumed in accordance with the terms of this Agreement all of the Liabilities, and all duties, obligations and responsibilities incident thereto, which such Party is entitled to acquire or required to Assume pursuant to the terms of this Agreement. In furtherance of the foregoing, in the event that any consent required to transfer or assign any Franchise Agreement to Spinco or any member of the Spinco Group reasonably acceptable to Parent is not obtained prior to the Effective Time, then, at the Effective Time, (i) unless otherwise determined by Parent, the Applicable Franchise Assets with respect to such Franchise Agreement shall not be transferred to Spinco or such member of the Spinco Group reasonably acceptable to Parent at the Effective Time and (ii) Spinco and Parent shall enter into a Management Agreement, substantially in the form of Exhibit E hereto, in respect of such Franchise Agreement. Upon receipt of the necessary consent to transfer or assign such Franchise Agreement and to the extent the Applicable Franchise Assets and Applicable Franchise Liabilities have not previously been transferred to Spinco or a member of the Spinco Group, (i) Parent shall transfer to Spinco or such member of the Spinco Group reasonably acceptable to Parent the Applicable Franchise Assets with respect to such Franchise Agreement, (ii) Spinco shall Assume the Applicable Franchise Liabilities, with respect to such Franchise Agreement and (iii) such Management Agreement shall terminate in accordance with its terms.

(b) If and when the Consents, Governmental Approvals and/or conditions, the absence or non-satisfaction of which caused the deferral of the Transfer of any Asset or the deferral of the Assumption of any Liability pursuant to Section 2.7(a), are obtained or satisfied, the Transfer, Assumption or novation of the applicable Asset or Liability shall be effected in accordance with and subject to the terms of this Agreement and/or the applicable Ancillary Agreement as promptly as practical after the receipt of such Consents, Governmental Approvals and/or absence or satisfaction of such conditions.

(c) Subject to the provisions of Section 2.7(a), the Party (or relevant member of its Group) retaining any Asset or Liability due to the deferral of the Transfer of such Asset or the deferral of the Assumption of such Liability pursuant to Section 2.7(a) shall not be obligated, in connection with the foregoing, to expend any money unless the necessary funds are advanced, or agreed in advance to be reimbursed by the Party or Parties (or relevant member of its Group or their Groups), as the case may be, entitled to such Asset or the Person intended to be subject to such Liability, other than reasonable attorneys’ fees and recording or similar fees, all of which shall be promptly reimbursed by the Party or Parties (or relevant member of its Group or their Groups) entitled to such Asset or the Person intended to be subject to such Liability.

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(d) On and prior to the 24 month anniversary of the Effective Time, if any Party determines that it (or any member of its Group) owns any Asset that, although not Transferred pursuant to this Agreement, was allocated by the terms of this Agreement to another Party, or that is agreed by such Party and the other Party in their good faith judgment to be an Asset that more properly belongs to the other Party (other than (for the avoidance of doubt), as between any two Parties, for any Asset acquired from an unaffiliated third party by a Party or member of such Party’s Group following the Effective Time), then the Party owning such Asset shall Transfer, or shall cause any such Asset to be Transferred, to the applicable Party (or relevant member of its Group) identified as the appropriate transferee and following such Transfer, such Asset shall be an LDC Asset or Retained Business Asset, as the case may be. In connection with such Transfer, the receiving party shall Assume all Liabilities related to such Asset. Following the 24 month anniversary of the Effective Time, no Party (or relevant member of its Group) shall be obligated to Transfer any newly recognized Asset that would, had such Asset been recognized at the Effective Time, have been Transferred to the other applicable Party (or relevant member of its Group).

(e) After the Effective Time, each Party (or any member of its Group) may receive mail, packages and other communications properly belonging to another Party (or any member of its Group). Accordingly, at all times after the Effective Time, each Party authorizes the other applicable Party (or any member of its Group) to receive and open all mail, packages and other communications received by such Party (or any member of its Group) and not unambiguously intended for such first Party, any member of such first Party’s Group or any of their respective officers, directors, employees or other agents, and to the extent that they do not relate to the business of the receiving Party, the receiving Party shall promptly deliver such mail, packages or other communications (or, in case the same relate to both Businesses, copies thereof) to the other applicable Party as provided for in Section 11.6 (Notices). The provisions of this Section 2.7(e) are not intended to, and shall not, be deemed to constitute an authorization by any Party (or any member of its Group) to permit the other to accept service of process on its (or its members’) behalf and no Party (or any member of its Group) is or shall be deemed to be the agent of any other Party (or any member of its Group) for service of process purposes.

Section 2.8 Conveyancing and Assumption Instruments. In connection with, and in furtherance of, the Transfers of Assets and the acceptance and Assumptions of Liabilities contemplated by this Agreement, the Parties shall execute or cause to be executed, on or prior to the Effective Time, by the appropriate entities, the Conveyancing and Assumption Instruments necessary to evidence the valid and effective Assumption by the applicable Party (or any member of its Group) of its Assumed Liabilities, and the valid Transfer to the applicable Party (or member of such Party’s Group) of all right, title and interest in and to its accepted Assets, including the Transfer of real property or easements or other rights of way with quit claim deeds, as may be appropriate. Spinco shall be responsible for the recording of any such quit claim deeds or other transfer documents.

Section 2.9 Further Assurances.

(a) In addition to and without limiting the actions specifically provided for elsewhere in this Agreement, including Section 2.7, the Parties shall cooperate with each other and use (and will cause the relevant member of its Group to use) commercially reasonable efforts,

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prior to, on and after the Effective Time, to take, or to cause to be taken, all actions, and to do, or to cause to be done, all things reasonably necessary on its part under applicable Law or contractual obligations to consummate and make effective the transactions contemplated by this Agreement and the Ancillary Agreements.

(b) Without limiting the foregoing, each Party shall cooperate with the other Party, from and after the Effective Time, without any further consideration, to execute and deliver, or use commercially reasonable efforts to cause to be executed and delivered, all instruments, including instruments of Transfer and title and to make all filings with, and to obtain all Consents and/or Governmental Approvals, any permit, Contract, indenture or other instrument (including any Consents or Governmental Approvals), and to take all such other actions as such Party may reasonably be requested to take by the other Party from time to time, consistent with the terms of this Agreement and the Ancillary Agreements, in order to effectuate the provisions and purposes of this Agreement and the Ancillary Agreements and the Transfers of the applicable Assets and the assignment and Assumption of the applicable Liabilities and the other transactions contemplated hereby and thereby; provided, however, that no Party or any of its Affiliates shall be required to pay any money or other consideration in order to obtain any such Consent. Without limiting the foregoing, each Party will, at the reasonable request of the other Party, take such other actions as may be reasonably necessary to vest in such other Party such title as possessed by the Transferring Party to the Assets allocated to such other Party under this Agreement or any of the Ancillary Agreements, free and clear of any Security Interest, if and to the extent it is practicable to do so.

Section 2.10 Novation of Liabilities.

(a) With respect to a Liability for which a Party, including its Subsidiaries, is not responsible under this Agreement after the Effective Time, but for which a Party or one or more of its Subsidiaries continues to be liable to a third party after the Effective Time, that Party may request the Party responsible under this Agreement for the Liability to take actions after the Effective Time to relieve the requesting Party from such Liability. Upon any such request, the responsible Party shall use commercially reasonable efforts either:

(i) to obtain, or cause to be obtained, any Consent, release, transfer, substitutions or novations required for such Liability to become solely the Liability of the responsible Party or one of its respective Subsidiaries; or

(ii) to obtain an unconditional release from Liability for the requesting Party and/or its relevant Subsidiaries.

The responsible Party is not required by this provision to pay any money or other consideration to relieve the requesting Party from the Liability unless the Requesting Party agrees to reimburse the responsible Party in full upon or prior to the payment.

(b) If the responsible Party is unable to relieve the requesting Party and any of its relevant Subsidiaries from a Liability in compliance with Section 2.10(a), the Party who Assumed or retained such Liability (the “Liable Party”) shall, or shall cause one of its Subsidiaries, to pay, perform, discharge or otherwise satisfy in full the Liability, unless not permitted to do so

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by Law or Contract. As required to satisfy the Liability and not otherwise prohibited, the Liable Party may act as an agent or subcontractor for the requesting Party in order to relieve the requesting Party from the Liability. This provision does not relieve the requesting Party from the Liability. This provision does not require the requesting Party to extend, renew or otherwise cause a Contract or other Liability to remain in effect beyond the term in effect as of the Effective Time. The other Party shall, without further consideration, promptly pay and remit, or cause to be promptly paid or remitted, to the Liable Party or any of its Subsidiaries responsible for the Liability, all money, rights and other consideration received by the Party or its Subsidiaries in respect of such performance by the Liable Party (unless any such consideration is an Asset of such other Party or one of its Subsidiaries pursuant to this Agreement). If and when any such Consent, release, substitution, amendment or release of the Liability shall be obtained, or such agreement, lease, license or other rights or obligations giving rise to the Liability shall otherwise become assignable or able to be novated, the other Party shall promptly Transfer, or cause to be Transferred, all rights, obligations and other Liabilities thereunder of any of it or its Subsidiaries to the Liable Party or to one of its Subsidiaries if requested to do so without payment of any further consideration, and the Liable Party, or another member of such Liable Party’s Group, without the payment of any further consideration, shall Assume such rights and Liabilities.

Section 2.11 Guarantees. Each of the Parties shall, and shall cause the other members of their respective Groups to, use their commercially reasonable efforts to evaluate or to assist the other Party in evaluating any guarantee required to be so evaluated by Financial Accounting Standards Board Interpretation No. 45.

Section 2.12 Treatment of Shared Contracts.

(a) Without limiting the generality of the obligations set forth in Sections 2.1, 2.2 and 2.3, unless the Parties otherwise agree or the benefits of any Contract described in this Section 2.12 are expressly conveyed to the applicable Party pursuant to an Ancillary Agreement, (i) any Contract that is listed on Schedule 2.12(a) shall be assigned in part to the applicable member(s) of the applicable Group, if so assignable, or appropriately amended prior to, on or after the Distribution Date, so that each Party or the members of its respective Group shall, as of the Distribution Date, be entitled to the rights and benefits, and shall assume the related portion of any Liabilities, inuring to its respective businesses, in each case, unless otherwise specifically agreed to by the Parties, in accordance with the allocation of benefits and burdens reasonably determined by Parent after taking into consideration (A) the rights, benefits and Liabilities historically allocated to each Party or the members of its respective Group prior to the Distribution Date and (B) the anticipated future rights, benefits and Liabilities of each Party or members of its respective Group under the applicable Contract after the Distribution Date, and (ii) (A) any Contract that is a Retained Business Asset or Retained Business Liability but, prior to the Distribution Date, inured in part to the benefit or burden of any member of the Spinco Group (other than any such Contract covering substantially the same services or arrangements that are covered by a Contract entered into by a member of the Spinco Group in connection with the Separation), and (B) any Contract that is an LDC Asset or an LDC Liability but, prior to the Distribution Date, inured in part to the benefit or burden of any member of the Parent Group (other than any such Contract covering substantially the same services or arrangements that are covered by a Contract entered into by a member of the Parent Group in connection with the Separation), shall be assigned in part to the applicable member(s) of the applicable Group, if so

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assignable, or appropriately amended prior to, on or after the Distribution Date, so that each Party or the members of its respective Group shall, as of the Distribution Date, be entitled to the rights and benefits, and shall assume the related portion of any Liabilities, inuring to its respective businesses (any contract, agreement, arrangement, commitment or understanding referred to in clause (i) or (ii) above, a “Shared Contract”); provided, however, that, in the case of each of clause (i) and (ii), (1) in no event shall any member of any Group be required to assign (or amend) any Shared Contract in its entirety or to assign a portion of any Shared Contract which is not assignable (or cannot be amended) by its terms (including any terms imposing consents or conditions on an assignment where such consents or conditions have not been obtained or fulfilled) and (2) if any Shared Contract cannot be so partially assigned by its terms or otherwise, or cannot be amended or if such assignment or amendment would impair the benefit the Parties thereto derive from such Shared Contract, then the Parties shall, and shall cause each of their respective Subsidiaries to, take such other reasonable and permissible actions (including by providing prompt notice to the other Party with respect to any relevant claim of Liability or other relevant matters arising in connection with a Shared Contract so as to allow such other Party the ability to exercise any applicable rights under such Shared Contract) to cause a member of the Spinco Group or the Parent Group, as the case may be, to receive the rights and benefits of that portion of each Shared Contract that relates to the LDC Business or the Retained Businesses, as the case may be (in each case, to the extent so related), as if such Shared Contract had been assigned to (or amended to allow) a member of the applicable Group pursuant to this Section 2.12, and to bear the burden of the corresponding Liabilities (including any Liabilities that may arise by reason of such arrangement), as if such Liabilities had been assumed by a member of the applicable Group pursuant to this Section 2.12.

(b) Each of Parent and Spinco shall, and shall cause the members of its Group to, (i) treat for all Tax purposes the portion of each Shared Contract inuring to its respective businesses as Assets owned by, and/or Liabilities of, as applicable, such Party, or its Subsidiaries, as applicable, not later than the Distribution Date, and (ii) neither report nor take any Tax position (on a Tax Return or otherwise) inconsistent with such treatment (unless required by applicable Law).

(c) Nothing in this Section 2.12 shall require any member of any Group to make any material payment (except to the extent advanced, assumed or agreed in advance to be reimbursed by any member of the other Group), incur any material obligation or grant any material concession for the benefit of any member of any other Group in order to effect any transaction contemplated by this Section 2.12.

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Section 2.13 Disclaimers of Representations and Warranties.

(a) For the purposes of this Section 2.13, this Agreement, the Ancillary Agreements and any real property instruments or other Contracts, affidavits or instruments of any kind executed and delivered under or resulting from this Agreement, any Ancillary Agreement or any transaction contemplated thereby are referred to as the “Spin Agreements” for all purposes. Except as stated in Section 2.13(e), no Party (or any member of such Party’s Group) makes any representation or warranty, expressed or implied, including any implied warranty of fitness for a particular purpose or merchantability or habitability, to any other Party (or to any member of any other Party’s Group or to any other Person interested in the contemplated transactions) in any way as to any matter, including any of the following:

(i) the Assets, Businesses, or Liabilities Transferred or Assumed;

(ii) any matter involving the Assets, Businesses or Liabilities;

(iii) any Consents or Governmental Approvals required in connection with the Spin Agreements;

(iv) the value, title or freedom from any Security Interests or any other encumbrance or defect in title or right of possession, with respect to Assets of such Party (or member of such Party’s Group);

(v) the absence of any defenses or right of setoff or freedom from counterclaim with respect to any Action or other Asset, including accounts receivable, of any Party; and

(vi) the legal sufficiency of any contribution, distribution, assignment, document, certificate or instrument delivered under any of the Spin Agreements as consideration for the conveyance or transfer of title to any Asset or thing of value.

(b) Except as stated in Section 2.13(e), all Assets to be retained or Transferred, and the Liabilities to be retained, Assumed, or Transferred in accordance with any Spin Agreement shall be retained, Transferred or Assumed on an “AS IS,” “WHERE IS” and “WITH ALL FAULTS” basis (and, in the case of any real property, by means of a deed or conveyance without warranty).

(c) Except as stated in Section 2.13(e), the respective transferees under any conveyance or Transfer made under any Spin Agreement shall bear the economic and legal risks that (i) any conveyance shall prove to be insufficient to vest in the transferee good title, free and clear of any Security Interest or any other defect or encumbrance upon title or right of possession and (ii) any necessary Consents or Governmental Approvals are not obtained or that any requirements of Laws or judgments are not complied with.

(d) Except as stated in Section 2.13(e), the Parties acknowledge that any information provided in connection with any of the Spin Agreements is for the Party’s informational purposes only, and no Party makes any representation or warranty, either specifically or implied, whatsoever as to the accuracy or completeness of any information, document or material made available in connection with the Separation or the entering into of this Agreement or the transactions contemplated hereby or thereby. Each Party acknowledges that it has performed its own due diligence and is not relying upon any information provided by any Party in making its determination to enter into this Agreement, except to the extent specifically provided herein to the contrary.

(e) All disclaimers of representations and warranties contained in this Section 2.13 are limited by and subject to the exclusion of all specific representations and warranties expressly stated in any Spin Agreement insofar as such expressly stated representations or

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warranties apply to the subject matter of the Spin Agreement in which they are stated and expressly and specifically apply, if at all, to the subject matter of any other Spin Agreement. All such disclaimers do not limit or exclude any indemnity against specific items included in any of the Spin Agreements.

(f) The Parties intend to bind each member of their respective Groups to the provisions of this Section 2.13 and agree to take all steps necessary to make the disclaimers herein binding upon the members of their respective Groups.

ARTICLE III

CERTAIN ACTIONS PRIOR TO THE DISTRIBUTION

Section 3.1 Separation. The Parties agree to take, and cause the members of their respective Groups to take, prior to the Distribution, all actions necessary, subject to the terms of this Agreement, to effectuate the Separation, including the actions set forth in Exhibit A styled “Reorganization Actions.”

Section 3.2 Directors. On or prior to the Distribution Date, Parent shall take all necessary action to cause the board of directors of Spinco to consist of the individuals identified in the Information Statement as directors of Spinco.

Section 3.3 Resignations.

(a) Subject to Section 3.3(b), on or prior to the Effective Time, (i) Spinco shall cause all Spinco Employees to resign, effective as of the Effective Time, from all positions as officers or directors of any member of the Parent Group in which they serve and (ii) Parent shall cause all of its employees and any employees of its Affiliates who do not become Spinco Employees, as the case may be, immediately following the Effective Time to resign, effective as of the Effective Time, from all positions as officers or directors of any member of the Spinco Group in which they serve.

(b) No Person shall be required by any Party to resign from any position or office with another Party if such Person is disclosed in the Information Statement as the Person who is to hold such position or office following the Distribution.

Section 3.4 Spinco Financings.

(a) Prior to or concurrently with the Separation, Spinco shall enter into the Spinco Financing Arrangements, on such terms and conditions as agreed by Parent (including the amount that shall be borrowed pursuant to the Spinco Financing Arrangements and the interest rates for such borrowings). Parent and Spinco shall participate in the preparation of all materials and presentations as may be reasonably necessary to secure funding pursuant to the Spinco Financing Arrangements, including rating agency presentations necessary to obtain the requisite ratings needed to secure the financing under any of the Spinco Financing Arrangements. The Parties agree that Spinco, and not Parent, shall be ultimately responsible for all costs and expenses incurred by, and for reimbursement of such costs and expenses to, any member of the Parent Group or Spinco Group associated with the Spinco Financing Arrangements.

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(b) Prior to the Effective Time, Spinco shall pay to Parent an amount of cash equal to $[—] in satisfaction of its obligations under Section 2.2(a)(y) (the “Separation Payment”).

Section 3.5 Ancillary Agreements. On or prior to the Distribution, each of Parent and Spinco shall enter into, and/or (where applicable) shall cause a member or members of their respective Group to enter into, the Ancillary Agreements and any other Contracts in respect of the Distribution reasonably necessary or appropriate in connection with the transactions contemplated hereby and thereby.

ARTICLE IV

THE DISTRIBUTION

Section 4.1 Stock Dividends to Parent; Distribution. Prior to the Distribution, Parent will own all of the issued and outstanding shares of Spinco Common Stock. On or prior to the Distribution Date (i) Spinco shall issue to Parent as a stock dividend such number of shares of Spinco Common Stock, (or Parent and Spinco shall take or cause to be taken such other appropriate actions to ensure that Parent has the requisite number of shares of Spinco Common Stock) as will be required so that the total number of shares of Spinco Common Stock held by Parent immediately prior to the Distribution is equal to the total number of shares of Spinco Common Stock distributable in the Distribution and (ii) Parent will cause the Distribution Agent to distribute all of the outstanding shares of Spinco Common Stock then owned by Parent to record holders of Parent Common Stock on the Distribution Record Date, and to credit the appropriate class and number of such shares of Spinco Common Stock to book entry accounts for each such record holder of Spinco Common Stock. Each record holder of Parent Common Stock on the Distribution Record Date will be entitled to receive in the Distribution [            ] share of Spinco Common Stock for every [            ] shares of Parent Common Stock held by such stockholder. No action by any such stockholder shall be necessary for such stockholder to receive the applicable number of shares of Spinco Common Stock (and, if applicable, cash in lieu of any fractional shares) such stockholder is entitled to in the Distribution.

Section 4.2 Fractional Shares. Parent stockholders holding a number of shares of Parent Common Stock on the Distribution Record Date, which would entitle such stockholders to receive less than one whole share of Spinco Common Stock, in the applicable Distribution, will receive cash in lieu of such fractional shares. Fractional shares of Spinco Common Stock will not be distributed in the Distribution nor credited to book-entry accounts. The Distribution Agent shall, as soon as practicable after the Distribution Date (a) determine the number of whole shares and fractional shares of Spinco Common Stock allocable to each holder of record of Parent Common Stock as of close of business on the Distribution Record Date, (b) aggregate all such fractional shares into whole shares and sell the whole shares obtained thereby in open market transactions as soon as practicable after the applicable Distribution, in each case, at then prevailing trading prices on behalf of holders who would otherwise be entitled to fractional

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share interests, and (c) distribute to each such holder, or for the benefit of each such beneficial owner, such holder or owner’s ratable share of the net proceeds of such sale, based upon the average gross selling price per share of Spinco Common Stock after making appropriate deductions for any amount required to be withheld for United States federal income tax purposes. Spinco shall bear the cost of brokerage fees incurred in connection with these sales of fractional shares, which sales shall occur as soon after the applicable Distribution Date as practicable and as determined by the Distribution Agent. None of Parent, Spinco, or the Distribution Agent will guarantee any minimum sale price for the fractional shares of Spinco Common Stock. Neither Parent nor Spinco will pay any interest on the proceeds from the sale of fractional shares. The Distribution Agent acting on behalf of the applicable Party will have the sole discretion to select the broker-dealers through which to sell the aggregated fractional shares and to determine when, how and at what price to sell such shares. Neither the Distribution Agent nor the broker-dealers through which the aggregated fractional shares are sold will be Affiliates of Parent or Spinco.

Section 4.3 Unclaimed Shares or Cash.

(a) Any Spinco Common Stock or cash in lieu of fractional shares with respect to Spinco Common Stock that 180 days after the Distribution Date remains unclaimed by holders of Parent Common Stock on the Distribution Record Date shall be delivered to Spinco. Spinco shall hold all such Spinco Common Stock and cash for the account of such stockholders and any such stockholder shall look only to Spinco for such Spinco Common Stock and cash, if any, in lieu of fractional share interests, subject in each case to applicable escheat or other abandoned property laws. Spinco shall indemnify the Parent Indemnitees in accordance with ARTICLE VII hereof for all claims relating to such Spinco Common Stock and cash so delivered to Spinco.

(b) No interest shall be paid on cash held in lieu of fractional shares under Section 4.3(a).

Section 4.4 Actions in Connection with the Distribution.

(a) Spinco shall file with the Commission such amendments and supplements to its Form 10 as Parent may reasonably request, and such amendments as may be necessary in order to cause the same to become and remain effective as required by Law, including filing such amendments and supplements to its Form 10, Information Statement or a Current Report on Form 8-K as may be required by the Commission or federal, state or foreign securities Laws. Spinco shall mail to the holders of Parent Common Stock, at such time on or prior to the Distribution Date as Parent shall determine, the Information Statement included in its Form 10 (or as filed as an exhibit to a Current Report on Form 8-K for such Party), as well as any other information concerning Spinco, its business, operations and management, the Separation and such other matters as Parent shall reasonably determine are necessary and as may be required by Law.

(b) Spinco shall also cooperate with Parent in preparing, filing with the Commission and causing to become effective registration statements or amendments thereof which are required to reflect the establishment of, or amendments to, any employee benefit and other plans necessary or appropriate in connection with the Separation or other transactions contemplated by this Agreement and the Ancillary Agreements. Promptly after receiving a request from Parent, to the extent requested, Spinco shall prepare and, in accordance with applicable Law, file with the Commission any such documentation that Parent determines is necessary or desirable to effectuate the Distribution, and Parent and Spinco shall each use commercially reasonable efforts to obtain all necessary approvals from the Commission with respect thereto as soon as practicable.

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(c) Promptly after receiving a request from Parent, Spinco shall prepare and file, and shall use commercially reasonable efforts to have approved and made effective, an application for the original listing on the NYSE of the Spinco Common Stock to be distributed in the Distribution, subject to official notice of Distribution.

(d) Nothing in this Section 4.4 shall be deemed, by itself, to shift Liability for any portion of such Form 10 or Information Statement to Parent.

Section 4.5 Sole Discretion of Parent. Parent shall, in its sole and absolute discretion, determine the Distribution Date and all terms of the Distribution, including the form, structure and terms of any transactions and/or offerings to effect the Distribution and the timing of and conditions to the consummation thereof. In addition, notwithstanding anything in this Agreement to the contrary, Parent may, in accordance with Section 11.11, at any time and from time to time until the completion of the Distribution, decide to abandon the Distribution or modify or change the terms of the Distribution, including by accelerating or delaying the timing of the consummation of all or part of the Distribution. Notwithstanding anything in this Agreement to the contrary, none of Spinco, any other member of the Spinco Group, any Spinco Employee or any third party shall have any right or claim to require the consummation of the Separation or the Distribution, which shall be effected at the sole discretion of the board of directors of Parent.

Section 4.6 Conditions to the Distribution. Subject to Section 4.5, the following are conditions to the consummation of the Distribution. The conditions are for the sole benefit of Parent and shall not give rise to or create any duty on the part of Parent or the board of directors of Parent to waive or not waive any such condition:

(a) The Form 10 shall have been declared effective by the Commission, with no stop order in effect with respect thereto, and the Information Statement shall have been mailed to the holders of Parent Common Stock who held Parent Common Stock as of the Distribution Record Date;

(b) The Spinco Common Stock to be delivered in the Distribution shall have been approved for listing on the NYSE, subject to official notice of distribution;

(c) Prior to the Distribution, Parent shall have obtained a private letter ruling from the Internal Revenue Service in form and substance satisfactory to Parent (in its sole discretion), and such ruling shall remain in effect as of the Distribution Date, to the effect, among other things, that (i) such Distribution, together with certain related transactions, will qualify as a reorganization under Sections 355 and 368(a)(1)(D) of the Code, (ii) no gain or loss will be recognized by (and no amount will otherwise be included in the income of) the stockholders of Parent upon their receipt of Spinco Common Stock pursuant to such Distribution; and (iii) no gain or loss will be recognized by Parent pursuant to such Distribution;

(d) Prior to the Distribution, Parent shall have obtained an opinion from Skadden, Arps, Slate, Meagher & Flom LLP, its tax counsel, in form and substance satisfactory to Parent (in its sole discretion), substantially to the effect that, among other things, such Distribution, together with certain related transactions, should qualify as a reorganization under Sections 355 and 368(a)(1)(D) of the Code;

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(e) Prior to the Distribution, Parent shall have obtained a surplus and solvency opinion(s) from a nationally recognized valuation firm, in form and substance satisfactory to Parent (in its sole discretion), substantially to the effect that, among other things: (i) Parent has adequate surplus under Oklahoma law to declare the Distribution dividend and (ii) following the Separation and the Distribution, Parent, on the one hand, and Spinco, on the other hand, will be solvent and adequately capitalized;

(f) Any material Governmental Approvals (including the Kansas Approval) and other Consents (including Consents required under the Credit Agreement), necessary to consummate the Separation or the Distribution or any portion thereof shall have been obtained and be in full force and effect, including the regulatory approvals listed or described on Schedule 4.6(f);

(g) No order, injunction or decree issued by any Governmental Entity of competent jurisdiction or other legal restraint or prohibition preventing the consummation of all or any portion of the Separation or the Distribution shall be in effect, and no other event outside the control of Parent shall have occurred or failed to occur that prevents the consummation of all or any portion of the Separation or the Distribution;

(h) With respect to the Distribution, the financing transactions described in the Information Statement as having occurred prior to the Distribution Date shall have been consummated on or prior to the Distribution Date; and

(i) The board of directors of Parent shall have approved the Distribution, which approval may be given or withheld at its absolute and sole discretion.

ARTICLE V

CERTAIN COVENANTS

Section 5.1 Legal Names and Other Parties’ Trademarks.

(a) Except as otherwise specifically provided in any Ancillary Agreement, as soon as reasonably practicable after the Effective Time but in any event within six months thereafter, each Party shall cease (and shall cause all of the other members of its Group to cease) (i) making any use of any names or Trademarks that include (A) any of the Trademarks of the other Party or such other Party’s Subsidiaries or Affiliates (including, in the case of Spinco, “ONEOK” or “ONEOK, Inc.”) and (B) any names or Trademarks related thereto, including any names or Trademarks confusingly similar thereto or dilutive thereof (with respect to each Party, such Trademarks of the other Party and its Affiliates, the “Other Party Marks”), and (ii) holding themselves out as having any affiliation with any of the other Party’s or such Party’s Subsidiaries or Affiliates; provided, however, that the foregoing shall not prohibit any Party or any member of a Party’s Group from (1) stating in any advertising or any other communication that it is formerly a Parent affiliate or otherwise describing its historical relationships with Parent, the other Party and their respective Subsidiaries or (2) making use of any Other Party Mark in a manner that

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would constitute “fair use” under applicable Law if any unaffiliated third party made such use or would otherwise be legally permissible for any unaffiliated third party without the Consent of the Party owning such Other Party Mark. In furtherance of the foregoing, as soon as practicable but in no event later than six months following the Effective Time, each Party and the members of each Party’s Group shall, and shall cause each of its Affiliates to remove, strike over or otherwise obliterate all Other Party Marks from all of such Party’s and its Subsidiaries’ and Affiliates’ assets and other materials, including any vehicles, business cards, schedules, stationery, packaging materials, displays, signs, promotional materials, manuals, forms, websites, email, computer software and other materials and systems. Any use by any of the Parties or any of their Subsidiaries or Affiliates of any of the Other Party Marks as permitted in this Section 5.1 is subject to their compliance with the quality control requirements and guidelines in effect for the Other Party Marks as of the Effective Time.

(b) Notwithstanding the foregoing requirements of Section 5.1(a), if any Party or any member of a Party’s Group exercised good faith efforts to comply with Section 5.1(a) but is unable, due to regulatory or other circumstances beyond its control, to effect a legal name change in compliance with applicable Law such that an Other Party Mark remains in such Party’s or its Group member’s corporate name, then the relevant Party or its Group member will not be deemed to be in breach hereof if it continues to exercise good faith efforts to effectuate such name change and does effectuate such name change within 12 months after the Effective Time, and, in such circumstances, such Party or Group member may continue to include in its assets and other materials references to the Other Party Mark that is in such Party’s or Group member’s corporate name, which includes references to “ONE Gas” or “ONEOK,” as applicable, but only to the extent necessary to identify such Party or Group member and only until such Party’s or Group member’s legal name can be changed to remove and eliminate such references.

(c) Notwithstanding the foregoing requirements of Section 5.1(a), Spinco shall not be required to change any name including the phrase “ONEOK” in any third-party contract, lease, indenture or license, or in property records with respect to real or personal property, if an effort to change the name is commercially unreasonable; provided, however, that (i) Spinco on a prospective basis from and after the Effective Time, shall change the name in any new or amended third-party contract or license or property record and (ii) Spinco shall not advertise or make public any continued use of the “ONEOK” name permitted by this Section 5.1(c).

Section 5.2 Auditors and Audits; Annual and Quarterly Financial Statements and Accounting.

(a) Each Party agrees that during the period ending 180 days following the Effective Time (and with the consent of the other Party, which consent shall not be unreasonably withheld or delayed, during any period of time after such 180-day period reasonably requested by such requesting Party, so long as there is a reasonable business purpose for such request) and in any event solely with respect to the preparation and audit of each of the Party’s financial statements for any of the fiscal years 2013 and 2014, the printing, filing and public dissemination of such financial statements, the audit of each Party’s internal control over financial reporting and such Party’s management’s assessment thereof, and each Party’s management’s assessment of such Party’s disclosure controls and procedures:

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(i) Annual Financial Statements. Each Party shall provide or provide access to the other Party on a timely basis, all information reasonably required to meet its schedule for the preparation, printing, filing, and public dissemination of its annual financial statements and for management’s assessment of the effectiveness of its disclosure controls and procedures and its internal control over financial reporting in accordance with Items 307 and 308, respectively, of Regulation S-K promulgated by the Commission and, to the extent applicable to such Party, its auditor’s audit of its internal control over financial reporting and management’s assessment thereof in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 and the Commission’s and Public Company Accounting Oversight Board’s rules and auditing standards thereunder (such assessments and audit being referred to as the “2013 Internal Control Audit and Management Assessments”). Without limiting the generality of the foregoing, each Party will provide all required financial and other information with respect to itself and its Subsidiaries to its auditors in a sufficient and reasonable time and in sufficient detail to permit its auditors to take all steps and perform all reviews necessary to provide sufficient assistance to each Other Party’s Auditor with respect to information to be included or contained in such other Party’s annual financial statements and to permit such other Party’s auditor and management to complete the 2013 Internal Control Audit and Management Assessments.

(ii) Access to Personnel and Records. Each audited Party shall authorize, and use its commercially reasonable efforts to cause, its respective auditors to make available to each other Party’s auditor (each such other Party’s auditors, the “Other Party’s Auditor”) both the personnel who performed or are performing the annual audits of such audited Party (such Party with respect to its own audit, the “Audited Party”) and work papers related to the annual audits of such Audited Party, in all cases within a reasonable time prior to such Audited Party’s auditors’ opinion date, so that the Other Party’s Auditor is able to perform the procedures it considers necessary to take responsibility for the work of the Audited Party’s auditor as it relates to its auditor’s report on such other Party’s financial statements, all within sufficient time to enable such other Party to meet its timetable for the printing, filing and public dissemination of its annual financial statements. Each Party shall make available to the Other Party’s Auditor and management its personnel and Records in a reasonable time prior to the Other Party’s Auditor’s opinion date and other Party’s management’s assessment date so that the Other Party’s Auditor and other Party’s management are able to perform the procedures they consider necessary to conduct the 2013 Internal Control Audit and Management Assessments.

(b) Amended Financial Reports. In the event a Party restates any of its financial statements that includes such Party’s audited or unaudited financial statements with respect to any balance sheet date or period of operation as of the end of and for the fiscal years 2013 and 2014, such Party will deliver to the other Party a substantially final draft, as soon as the same is prepared, of any report to be filed by such first Party with the Commission that includes such restated audited or unaudited financial statements (the “Amended Financial Report”); provided, however, that such first Party may continue to revise its Amended Financial Report prior to its filing thereof with the Commission, which changes will be delivered to the other Party as soon as reasonably practicable; provided, further, however, that such first Party’s financial

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personnel will actively consult with the other Party’s financial personnel regarding any changes which such first Party may consider making to its Amended Financial Report and related disclosures prior to the anticipated filing of such report with the Commission, with particular focus on any changes which would have an effect upon the other Party’s financial statements or related disclosures. Each Party will reasonably cooperate with, and permit and make any necessary employees available to, the other Party, in connection with the other Party’s preparation of any Amended Financial Reports.

(c) Financials; Outside Auditors. If either Party or member of its respective Group is required, pursuant to Rule 3-09 of Regulation S-X promulgated by the Commission or otherwise, to include in its Exchange Act filings audited financial statements or other information of the other Party or member of the other Party’s Group, the other Party shall use its commercially reasonable efforts (i) to provide such audited financial statements or other information, and (ii) to cause its outside auditors to consent to the inclusion of such audited financial statements or other information in the Party’s Exchange Act filings.

(d) Third Party Agreements. Nothing in this Section 5.2 shall require any Party to violate any agreement with any third party regarding the confidentiality of confidential and proprietary information relating to that third party or its business; provided, however, that in the event that a Party is required under this Section 5.2 to disclose any such information, such Party shall use commercially reasonable efforts to seek to obtain such third party’s consent to the disclosure of such information.

Section 5.3 No Restrictions on Post-Closing Competitive Activities; Corporate Opportunities.

(a) Each of the Parties agrees that neither this Agreement nor any Ancillary Agreement shall include any non-competition or other similar restrictive arrangements with respect to the range of business activities that may be conducted by the Parties. Accordingly, each of the Parties acknowledges and agrees that nothing set forth in this Agreement shall be construed to create any explicit or implied restriction or other limitation on (i) the ability of any Party hereto to engage in any business or other activity that competes with the business of any other Party, or (ii) the ability of any Party to engage in any specific line of business or engage in any business activity in any specific geographic area. Except as expressly provided in Section 5.3 or Section 5.5 or in any Ancillary Agreement, Parent and the Parent Group shall have the right to, and shall have no duty not to, (i) engage in the same or similar business activities or lines of business as Spinco or its Group, (ii) do business with any client or customer of Spinco or its Group, and (iii) employ or otherwise engage any officer or employee of Spinco or its Group, and neither Parent nor the Parent Group nor any officer or director thereof, as an officer or director of Parent or any member of the Parent Group, shall be liable to Spinco and its Group or its stockholder for breach of any fiduciary duty by reason of any such activities of Parent or the Parent Group or of such Person’s participation therein.

(b) In the event that Parent or any other member of the Parent Group acquires knowledge of a potential transaction or matter that may be a corporate opportunity for both Parent or any other member of the Parent Group and Spinco or any other member of its Group, neither Parent nor any other member of the Parent Group nor any agent or advisor thereof shall have any

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duty to communicate or present such corporate opportunity to Spinco, or any other member of its Group and shall not be liable to Spinco or any member of its Group or to Spinco’s stockholders for breach of any fiduciary duty as a stockholder of Spinco by reason of the fact that Parent or any other member of the Parent Group pursues or acquires such corporate opportunity for itself, directs such corporate opportunity to another Person, or does not present such corporate opportunity to Spinco or any other member of its Group.

(c) In the event that Spinco or any member of its Group acquires knowledge of a potential transaction or matter that may be a corporate opportunity for both Parent or any other member of the Parent Group and Spinco or any other member of their respective Groups, neither Spinco nor any other member of its Group nor any agent or advisor thereof shall have any duty to communicate or present such corporate opportunity to Parent or any other member of the Parent Group and shall not be liable to Parent or any other member of the Parent Group or to Parent’s stockholders for breach of any fiduciary duty as a stockholder of any member of the Parent Group by reason of the fact that Spinco or any other member of its Group pursues or acquires such corporate opportunity for itself, directs such corporate opportunity to another Person, or does not present such corporate opportunity to Parent or any other member of the Parent Group.

(d) For the purposes of this Section 5.3, “corporate opportunities” of Spinco or any other member of its Group shall include, but not be limited to, business opportunities that Spinco or any other member of its Group is financially able to undertake, that are, by their nature, in a line of business of Spinco or any other member of its Group, including the LDC Business, are of practical advantage to them and are ones in which Spinco or any other member of its Group have an interest or a reasonable expectancy, and in which, by embracing the opportunities, the self-interest of Parent or any other member of the Parent Group or any of their officers or directors will be brought into conflict with that of Spinco or any other member of its Group, and “corporate opportunities” of Parent or any other member of the Parent Group shall include, but not be limited to, business opportunities that Parent or any other member of the Parent Group are financially able to undertake, that are, by their nature, in a line of business of Parent or any other member of the Parent Group, including any of the Retained Businesses, are of practical advantage to them and are ones in which Parent or any other member of the Parent Group have an interest or a reasonable expectancy, and in which, by embracing the opportunities, the self-interest of Spinco or any other member of its Group or any of their officers or directors will be brought into conflict with that of Parent or any other member of the Parent Group.

Section 5.4 Certain Matters Relating to Parent’s Organizational Documents. For a period of six years from the Distribution Date, the Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws of Parent shall contain provisions no less favorable with respect to indemnification than are set forth in the Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws of Parent immediately after the Effective Time, which provisions shall not be amended, repealed or otherwise modified for a period of six years from the Effective Time in any manner that would affect adversely the rights thereunder of individuals who, at or prior to the Effective Time, were directors, officers, employees, fiduciaries or agents of any member of the Parent Group or the Spinco Group, unless such modification shall be required by Law and then only to the minimum extent required by Law.

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Section 5.5 Non-Solicitation.

(a) Parent covenants and agrees that from the Effective Time until the second anniversary of the date of this Agreement, it will not, either directly or indirectly, or through an Affiliate, or by acting in concert with others, solicit any Spinco Employee (as defined in the Employee Matters Agreement), after such Person has ceased to be an employee of Parent or one of its Affiliates and while such Person is employed by Spinco or its Affiliates, to become an employee of, or consultant to, or to serve in any similar capacity with, Parent or any Affiliate of Parent; provided, however, that Parent and its Affiliates may engage in general employment advertising or solicitation not specifically targeting any such employees and may hire any such employee who responds to such advertising or solicitation or who approaches Parent or any of its Affiliates for employment.

(b) Spinco covenants and agrees that from the Effective Time until the second anniversary of the date of this Agreement, it will not, either directly or indirectly, or through an Affiliate, or by acting in concert with others, solicit any Parent Employee (as defined in the Employee Matters Agreement), after such Person has ceased to be an employee of Spinco or one of its Affiliates and while such Person is employed by Parent or its Affiliates, to become an employee of, or consultant to, or to serve in any similar capacity with, Spinco or any Affiliate of Spinco; provided, however, that Spinco and its Affiliates may engage in general employment advertising or solicitation not specifically targeting any such employees and may hire any such employee who responds to such advertising or solicitation or who approaches Spinco or any of its Affiliates for employment.

ARTICLE VI

CONTINGENT AND UNALLOCATED LIABILITIES

Section 6.1 Unallocated Liabilities.

(a) As of the Date of this Agreement, the Parties have not identified any Unallocated Liabilities. If a Liability (including a Contingent Liability) is not explicitly addressed in this Agreement or set forth in the Schedules, the Parties shall be presumed to have intended that the Liability be an LDC Liability or a Retained Business Liability. Such presumption may only be overcome by clear and convincing evidence to the contrary.

(b) Each of the Parties shall be responsible for its Allocated Percentage of any Unallocated Liability.

(c) After the Effective Time, if a Liability (including a Contingent Liability) is identified that is not explicitly addressed in the Agreement or set forth in the Schedules, the Liability shall be referred to the Contingent Claim Committee to determine responsibility for the Liability pursuant to the provisions of Section 6.3.

(d) Parent shall assume the defense of, and may seek to settle or compromise, any claim determined by the Contingent Claim Committee pursuant to Section 6.3 to be an Unallocated Liability. The costs and expenses of the defense or liquidation of an Unallocated Liability shall be included in the calculation of the amount of the applicable Unallocated Liability in determining the reimbursement obligations of the other Parties with respect thereto. The Parties shall cooperate in the defense as provided in Section 6.5.

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Section 6.2 Payments.

(a) The Party responsible for the administration of an Unallocated Liability shall be entitled to reimbursement of the other Party’s Allocated Percentage of all costs and expenses incurred in respect of such Unallocated Liability by that Party or a member of its Group. The reimbursable costs and expenses include those costs and expenses incurred in an Action related to an Unallocated Liability and those costs and expenses may be invoiced periodically in advance of a final determination of any such Action. Payment shall be due promptly after the responsible Party submits its invoice for such amount, provided that the Party responsible for administration shall provide reasonable supporting information for an invoice upon a request made within a reasonable time by a Party receiving an invoice.

(b) The term “costs and expenses” as used in reference to those costs and expenses that are to be reimbursed to the Party shall be broadly construed to include all costs and expenses incurred and attributable directly or indirectly to the defense, liquidation or satisfaction of an Unallocated Liability, including allocated costs of in-house counsel and other personnel, expert witness fees, reproduction expenses and the cost of deposition copies (video, electronic and hardcopy). The term “costs and expenses” shall include any cost or expense paid or incurred by or on behalf of any member of the responsible Party’s Group in respect of any such defense or liquidation.

(c) Any amounts billed and properly payable in accordance with this Section 6.2 that are not paid within 45 days of such bill shall bear interest at the lesser of (i) Prime Rate plus 2% per annum or (ii) the maximum contractual rate permitted by Law, from the date of invoice until paid. Adjustments to the interest rate based on the Prime Rate shall be made as of the first Business Day of each week based upon the Prime Rate at the close of the most recent prior Business Day.

Section 6.3 Procedures to Determine Status of Liability.

(a) As of the Effective Time, the Parties will form a Contingent Claim Committee of two persons comprised of the general counsel or chief legal officer of each of the Parties, or their respective delegates, for the purpose of resolving whether any Liability not specifically characterized in this Agreement or its Schedules, whose proper characterization is disputed, is an LDC Liability, a Retained Business Liability, or an Unallocated Liability.

(b) If either Party or any of its Subsidiaries shall receive notice or otherwise learn of the assertion of a Third Party Claim which may reasonably be determined to be an Unallocated Liability, such Party shall give the other Party and the Contingent Claim Committee written notice thereof promptly (and in any event within 15 days) after such Person becomes aware of such Liability or Third Party Claim. Thereafter, the Party shall deliver to the Contingent Claim Committee, promptly (and in any event within 10 calendar days) after the Party’s receipt thereof, copies of all notices and documents (including court papers) received by the Party or the member of such Party’s Group relating to the matter.

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(c) If a dispute shall arise between the Parties as to the proper characterization of any Liability (other than one covered under Section 6.3(b)), then any Party may refer that dispute to the Contingent Claim Committee for resolution in the same manner as is set forth for a Third Party Claim.

(d) The Contingent Claim Committee’s determination (which shall be made within 30 days of such referral), if unanimous, shall be binding on the Parties and their respective successors and assigns. If the Contingent Claim Committee cannot reach a unanimous determination as to the characterization of a Liability within 30 days after referral of the issue such matters shall be resolved in accordance with Section 9.1(d).

(e) Parent may commence defense of such matters pending decision of the Contingent Claims Committee (or decision regarding an Action, if applicable), but shall not be obligated to do so. If Parent commences any such defense and subsequently Spinco is determined hereunder to have the exclusive obligation to such claim, then, upon the request of Spinco, Parent shall promptly discontinue the defense of such matter and transfer the control thereof to Spinco. In such event, Spinco will reimburse Parent for all costs and expenses incurred prior to resolution of such dispute in the defense of such claim.

Section 6.4 Certain Case Allocation Matters. The Parties agree that if any Action not listed or described on Schedules 1.1(72)(vi) or 1.1(102)(vi) involves separate and distinct claims that, if not joined in a single Action, would constitute separate Liabilities of different Parties, they will use their commercially reasonable efforts to segregate such separate and distinct claims so that the Liabilities associated with each such claim (including all costs and expenses incurred after an agreed segregation of the claims) shall be treated as Liabilities of the appropriate Party and so that each Party shall have the rights and obligations with respect to each such claim (including pursuant to this ARTICLE VI as would have been applicable had such claims been commenced as separate Actions). Unless otherwise explicitly provided in this Agreement, (a) all costs and expenses associated with such claims and incurred prior to the agreed segregation of the claims shall be shared in accordance with their Allocated Percentages, and (b) this Section 6.4 shall not apply to any separate and distinct claim that is de minimis or frivolous in nature.

Section 6.5 Cooperation in Defense and Settlement.

(a) With respect to any Third Party Claim that implicates both Parties in a material fashion due to the allocation of Liabilities, responsibilities for management of defense and related indemnities pursuant to this Agreement or any of the Ancillary Agreements, the Parties agree to use commercially reasonable efforts to cooperate fully and maintain a joint defense (in a manner that will preserve for the Parties the attorney-client privilege, joint defense or other privilege with respect thereto).

(b) To the extent there are documents, other materials, access to employees or witnesses related to or from a Party that is not responsible for the defense or Liability of a particular Action, such Party shall provide to the other Party reasonable access to documents, other materials, employees, and shall permit employees, officers and directors to cooperate as witnesses in the defense of such Action.

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(c) Each of Parent and Spinco agrees that at all times from and after the Effective Time, if an Action currently exists or is commenced by a third party with respect to which a Party (or one of its Subsidiaries) is a named defendant, but the defense of such Action and any recovery in such Action is otherwise not a Liability allocated under this Agreement or any Ancillary Agreement to that Party, then the other Party shall use commercially reasonable efforts to cause the named but not liable defendant to be removed from such Action and such defendants shall not be required to make any payments or contributions therewith.

(d) In the case of any Action involving a matter contemplated by Section 6.5(c), (i) if there is a conflict of interest that under applicable rules of professional conduct would preclude legal counsel for one Party or one of its Subsidiaries representing another Party or one of its Subsidiaries or (ii) if any Third Party Claim seeks equitable relief that would restrict or limit the future conduct of the non-responsible Party or one of its Subsidiaries or such Party’s business or operations of a Party or its Subsidiaries, then the non-responsible Party shall be entitled to retain, at its expense, separate legal counsel to represent its interest and to participate in the defense, compromise, or settlement of that portion of the Third Party Claim against that Party or one of its Subsidiaries.

(e) It shall not be a defense to any obligation by any Party to pay any amount in respect of any Unallocated Liability that such Party was not consulted in the defense thereof, that such Party’s views or opinions as to the conduct of such defense were not accepted or adopted, that such Party does not approve of the quality or manner of the defense thereof or that such Unallocated Liability was incurred by reason of a settlement rather than by a judgment or other determination of Liability; provided, however, that neither Party shall settle an Unallocated Liability in a manner which would restrict or limit the future conduct of the other Party’s business or operations (or any of its Subsidiaries) without such other Party’s consent.

(f) If served with a citation or other writ or process in a proceeding that may involve a matter to be determined by the Contingent Claim Committee, each Party shall notify the General Counsel of the other Party promptly and shall take such steps as are required to avoid a failure to answer or otherwise appear or respond timely.

ARTICLE VII

RELEASES AND INDEMNIFICATION

Section 7.1 Release of Pre-Distribution Claims.

(a) When used in this ARTICLE VII with reference to any or all members of a particular Group or Groups, the term “Related Persons” shall mean the directors, officers, agents or employees of those members when acting in those capacities (including all those Persons who served in any of those capacities at any time prior to the Effective Time), together with their respective heirs, executors, administrators, successors and assigns. Except (A) as provided in Section 7.1(b), (B) as may be otherwise expressly provided in this Agreement or any Ancillary Agreement and (C) for any matter for which any Person is entitled to indemnification or contribution pursuant to this ARTICLE VII:

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(i) Parent, for itself and, to the extent of its power and authority, each of its Subsidiaries and their respective Related Persons, does hereby remise, release and forever discharge the members of the Spinco Group and its Related Persons from any and all Liabilities whatsoever, whether at Law or in equity (including any right of contribution), that exist, arise or result (A) from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur on or before the Effective Time or (B) any conditions existing or alleged to have existed on or before the Effective Time, including (x) negligent acts or failures to act, even if grossly negligent and (y) acts or failures to act in connection with the Separation and all other activities to implement the Distribution and any of the other transactions contemplated under this Agreement or any of the Ancillary Agreements.

(ii) Spinco, for itself and, to the extent of its power and authority, each of its Subsidiaries and their respective Related Persons, does hereby remise, release and forever discharge the members of the Parent Group and its Related Persons from any and all Liabilities whatsoever, whether at Law or in equity (including any right of contribution), that exist, arise or result (A) from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur on or before the Effective Time, or (B) any conditions existing or alleged to have existed on or before the Effective Time, including (x) negligent acts or failures to act, even if grossly negligent and (y) acts or failures to act in connection with the Separation and all other activities to implement the Distribution and any of the other transactions contemplated under this Agreement or any of the Ancillary Agreements.

(iii) Notwithstanding anything to the contrary in the foregoing subparts (i)–(ii), nothing in this Agreement shall remise, release or discharge any rights or claims that any Party, the members of its Group, or their respective Related Persons may have against any director, officer, agent, representative or employee of any member of that Party’s Group as a result of any Knowing Violation of Law, fraud or intentional misrepresentation by such director, officer, agent or employee of any member of that Party’s Group.

(b) Nothing contained in Section 7.1(a) shall impair or otherwise affect any right of any Person to enforce this Agreement, any Ancillary Agreement or any agreements, arrangements, commitments or understandings unrelated to the Separation and explicitly contemplated in this Agreement or any Ancillary Agreement to continue in effect after the Effective Time. In addition, nothing contained in Section 7.1(a) shall release any Person from:

(i) any Liability Assumed, Transferred or allocated to a Party or one of its Subsidiaries pursuant to or contemplated by this Agreement or any Ancillary Agreement including (A) with respect to Spinco, any LDC Liability, and (B) with respect to Parent, any Retained Business Liability;

(ii) any Liability for the sale, lease, construction or receipt of goods, property or services purchased, obtained or used in the ordinary course of business by a member of one Group from a member of any other Group prior to the Effective Time;

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(iii) any Liability for unpaid amounts for products or services or refunds owing on products or services due on a value-received basis for work done by a member of one Group at the request or on behalf of a member of another Group;

(iv) any Liability provided in or resulting from any other Contract or understanding that is entered into after the Effective Time between a Party or one of its Subsidiaries, on the one hand, and the other Party or one of its Subsidiaries or Related Persons, on the other hand;

(v) any Liability with respect to an Unallocated Liability pursuant to Section 6.1;

(vi) any Liability that any Party may have with respect to indemnification or contribution pursuant to this Agreement or otherwise for claims brought against the other Party, its Subsidiaries or Related Persons by a third party, which Liability shall be governed by the provisions of the other sections of this ARTICLE VII and, if applicable, the appropriate provisions of the Ancillary Agreements; or

(vii) any Liability of Related Persons to either Party, its Subsidiaries, or its Related Persons, for goods, services or property received, purchased or leased, or to be received, purchased or released, or due on a value-received basis for work done or to be done or under any Contract made after the Effective Time.

In addition, nothing contained in Section 7.1(a) shall release one Party from indemnifying any director, officer, agent or employee of the other Party or its Subsidiaries, who was a director, officer, agent or employee of the first Party or any of its Affiliates on or prior to the Effective Time, to the extent such director, officer, agent or employee is or becomes a named defendant in any Action with respect to which he or she was entitled to such indemnification pursuant to obligations existing prior to the Effective Time. Specifically, if an obligation giving rise to such Action is (A) a Retained Business Liability, Parent shall indemnify Spinco, its Subsidiaries and Related Persons from such Liability or (B) an LDC Liability, Spinco shall indemnify Parent, its Subsidiaries and Related Persons from such Liability, in accordance with the other provisions set forth in this ARTICLE VII.

(c) Each Party shall not, and shall not permit, to the extent of its power and authority, any Subsidiary or Related Person to, make any claim, demand or offset, or commence any Action asserting any claim, demand or offset, including any claim of contribution or indemnification, against the other Party or any member of the other Party’s Group, or any other Person released pursuant to Section 7.1(a), with respect to any and all Liabilities released pursuant to Section 7.1(a).

(d) It is the intent of each Party, by virtue of the provisions of this Section 7.1, to provide for a full and complete release and discharge of all Liabilities existing or arising from all acts and events occurring or failing to occur or alleged to have occurred or to have failed to occur and all conditions existing or alleged to have existed on or before the Effective Time, whether known or unknown, between one Party, its Subsidiaries and their respective Related Persons, on the one hand, and the other Party, its Subsidiaries and their respective Related Persons,

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on the other hand (including any contractual agreements or arrangements existing or alleged to exist between or among any such Persons on or before the Effective Time), except as specifically set forth in Sections 7.1(a) and 7.1(b).

(e) If any Subsidiary of a Party or any of such Party’s Related Persons initiates an Action with respect to claims released by this Section 7.1, the Party with which such Person is associated shall indemnify the other Party against such Action in accordance with the provisions set forth in this ARTICLE VII.

(f) At any time, at the reasonable request of either Party, the other Party shall cause each member of its respective Group and to the extent practicable each other Person on whose behalf it releases Liabilities pursuant to this Section 7.1 to execute and deliver releases reflecting the provisions hereof.

Section 7.2 Indemnification by Parent. Except as otherwise specifically set forth in any provision of this Agreement or of any Ancillary Agreement, following the Effective Time, Parent shall, and shall cause the other members of the Parent Group to indemnify, defend and hold harmless Spinco’s Indemnitees from and against any and all Indemnifiable Losses arising out of, by reason of or otherwise in connection with (i) the Retained Business Liabilities or the Parent Percentage of any Unallocated Liabilities, (ii) any misstatement or alleged misstatement of a material fact contained in any document filed with the Commission by any member of the Spinco Group pursuant to the Securities Act or the Exchange Act, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case to the extent, but only to the extent, that those Liabilities are caused by any such misstatement or omission or alleged misstatement or omission based upon information that is either furnished to any member of the Spinco Group by any member of the Parent Group or incorporated by reference by any member of the Spinco Group from any filings made by any member of the Parent Group with the Commission pursuant to the Securities Act or the Exchange Act, and then only if that statement or omission was made or occurred after the Effective Time, or (iii) any breach by Parent or any member of the Parent Group of any provision of this Agreement or any Ancillary Agreement, unless such Ancillary Agreement expressly provides for separate indemnification therein, in which case any such indemnification claims shall be made thereunder. The fact another member of the Parent Group has Assumed a Liability covered by this indemnification shall not limit or preclude Parent’s obligation with respect to that Liability under this Agreement.

Section 7.3 Indemnification by Spinco. Except as otherwise specifically set forth in any provision of this Agreement or of any Ancillary Agreement, following the Effective Time, Spinco shall, and shall cause the other members of the Spinco Group to indemnify, defend and hold harmless the Parent Indemnitees from and against any and all Indemnifiable Losses arising out of, by reason of or otherwise in connection with (i) the LDC Liabilities or the Spinco Percentage of any Unallocated Liabilities, (ii) any misstatement or alleged misstatement of a material fact contained in any document filed with the Commission by any member of the Parent Group pursuant to the Securities Act or the Exchange Act, or any omission or alleged omission to state therein a material fact

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required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case to the extent, but only to the extent, that those Liabilities are caused by any such misstatement or omission or alleged misstatement or omission based upon information that is either furnished to any member of the Parent Group, as the case may be, by any member of the Spinco Group or incorporated by reference by any member of the Parent Group from any filings made by any member of the Spinco Group with the Commission pursuant to the Securities Act or the Exchange Act, and then only if that statement or omission was made or occurred after the Effective Time, or (iii) any breach by Spinco or any member of the Spinco Group of any provision of this Agreement or any Ancillary Agreement, unless such Ancillary Agreement expressly provides for separate indemnification therein, in which case any such indemnification claims shall be made thereunder.

Section 7.4 Procedures for Indemnification.

(a) An Indemnitee shall give the Indemnifying Party written notice of any matter that an Indemnitee has determined has given or could give rise to a right of indemnification under this Agreement (other than a Third Party Claim which shall be governed by Section 7.4(b)), within 15 Business Days of such determination, stating the amount of the Indemnifiable Loss claimed, if known, and method of computation thereof, and containing a reference to the provisions of this Agreement in respect of which such right of indemnification is claimed by such Indemnitee or arises; provided, however, that the failure to provide such written notice shall not release the Indemnifying Party from any of its obligations except and solely to the extent the Indemnifying Party shall have been actually and materially prejudiced as a result of such failure (except that the Indemnifying Party or Parties shall not be liable for any expenses incurred during the period in which the Indemnitee failed to give such written notice).

(b) Third Party Claims. If a claim or demand is made against a Parent Indemnitee or a Spinco Indemnitee (each, an “Indemnitee”) by any Person who is not a party to this Agreement or an Affiliate of a Party (a “Third Party Claim”) as to which such Indemnitee is or may be entitled to indemnification pursuant to this Agreement, such Indemnitee shall notify the Party which is or may be required pursuant to this ARTICLE VII or pursuant to any Ancillary Agreement to make such indemnification (the “Indemnifying Party”) in writing, and in reasonable detail, of the Third Party Claim promptly (and in any event within 15 calendar days) after receipt by such Indemnitee of written notice of the Third Party Claim; provided, however, that the failure to provide written notice of any such Third Party Claim pursuant to this sentence shall not release the Indemnifying Party from any of its obligations except and solely to the extent the Indemnifying Party shall have been actually and materially prejudiced as a result of such failure (except that the Indemnifying Party or Parties shall not be liable for any expenses incurred during the period in which the Indemnitee failed to give such notice). Thereafter, the Indemnitee shall deliver to the Indemnifying Party, promptly (and in any event within 10 Business Days) after the Indemnitee’s receipt thereof, copies of all notices and documents (including court papers) received by the Indemnitee relating to the Third Party Claim.

(c) Other than in the case of (i) an Unallocated Liability (the defense of which shall be controlled as provided for in ARTICLE VI) or (ii) any Liability being managed by a Party in accordance with any Ancillary Agreement, an Indemnifying Party shall be entitled (but shall not

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be required) to assume, control the defense of, and settle any Third Party Claim, at such Indemnifying Party’s own cost and expense and by such Indemnifying Party’s own counsel, that is reasonably acceptable to the applicable Indemnitees, if it gives notice of its intention to do so to the applicable Indemnitees within 30 days of the receipt of such notice from such Indemnitees. After notice from an Indemnifying Party to an Indemnitee of its election to assume the defense of a Third Party Claim, such Indemnitee shall have the right to employ separate counsel and to participate in (but not control) the defense, compromise, or settlement thereof, at its own expense and, in any event, shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party, at the Indemnifying Party’s expense, all witnesses, pertinent information, materials and information in such Indemnitee’s possession or under such Indemnitee’s control relating thereto as are reasonably required by the Indemnifying Party. In the event of a conflict of interest between the Indemnifying Party and the applicable Indemnitee(s), or in the event that any Third Party Claim seeks equitable relief which would restrict or limit the future conduct of the Indemnitee(s) business or operations, such Indemnitee(s) shall be entitled to retain, at the Indemnifying Party’s expense, one separate counsel as required by the applicable rules of professional conduct with respect to such matter (which counsel shall be reasonably acceptable to the Indemnifying Party) and to participate in (but not control) the defense, compromise, or settlement of that portion of the Third Party Claim that seeks equitable relief with respect to the Indemnitee(s).

(d) Other than in the case of an Unallocated Liability, if an Indemnifying Party elects not to assume responsibility for defending a Third Party Claim, or fails to notify an Indemnitee of its election as provided in Section 7.4(c), such Indemnitee may defend such Third Party Claim at the cost and expense of the Indemnifying Party. If the Indemnitee is conducting the defense against any such Third Party Claim, the Indemnifying Party shall cooperate with the Indemnitee in such defense and make available to the Indemnitee, at the Indemnitee’s expense, all witnesses, pertinent information, material and information in such Indemnifying Party’s possession or under such Indemnifying Party’s control relating thereto as are reasonably required by the Indemnitee.

(e) Unless the Indemnifying Party has failed to assume the defense of the Third Party Claim in accordance with the terms of this Agreement, no Indemnitee may settle or compromise any Third Party Claim that is not an Unallocated Liability (which shall be governed by Section 6.3) without the Consent of the Indemnifying Party, which Consent shall not be unreasonably withheld or delayed. If an Indemnifying Party has failed to assume the defense of the Third Party Claim, it shall not be a defense to any obligation to pay any amount in respect of such Third Party Claim that the Indemnifying Party was not consulted in the defense thereof, that such Indemnifying Party’s views or opinions as to the conduct of such defense were not accepted or adopted, that such Indemnifying Party does not approve of the quality or manner of the defense thereof or that such Third Party Claim was incurred by reason of a settlement rather than by a judgment or other determination of liability.

(f) In the case of a Third Party Claim (except for any Third Party Claim that is an Unallocated Liability which, with respect to the subject matter of this Section 7.4(f), shall be governed by Section 6.3), no Indemnifying Party shall Consent to entry of any judgment or enter into any settlement of the Third Party Claim without the Consent (not to be unreasonably withheld) of the Indemnitee if the effect thereof is to permit any injunction, declaratory judgment, other

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order or other nonmonetary relief to be entered, directly or indirectly, against any Indemnitee; it being understood that in the case of a Third Party Claim that is an Unallocated Liability, such matters are addressed in ARTICLE VI.

(g) Except as otherwise provided in Section 11.21, absent Knowing Violation of Law, fraud or intentional misrepresentation by an Indemnifying Party, the indemnification provisions of this ARTICLE VII shall be the sole and exclusive remedy of an Indemnitee for any monetary or compensatory damages or losses resulting from any breach of this Agreement (including with respect to monetary or compensatory damages or losses arising out of or relating to, as the case may be, any LDC Liability or Retained Business Liability), and each Indemnitee expressly waives and relinquishes any and all rights, claims or remedies such Person may have with respect to the foregoing other than under this ARTICLE VII against any Indemnifying Party.

Section 7.5 Indemnification Payments. Indemnification required by this ARTICLE VII shall be made by periodic payments of the amount thereof in a timely fashion during the course of the investigation or defense, as and when bills are received or an Indemnifiable Loss or Liability incurred.

Section 7.6 Contribution.

(a) If the indemnification provided for in Section 7.2(ii) and Section 7.3(ii) is unavailable to, or insufficient to hold harmless an Indemnitee under this Agreement or any Ancillary Agreement in respect of any Liabilities referred to herein or therein, then each Indemnifying Party shall contribute to the amount paid or payable by such Indemnitee as a result of such Liabilities in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and the Indemnitee in connection with the actions or omissions that resulted in Liabilities as well as any other relevant equitable considerations. With respect to the foregoing, the relative fault of such Indemnifying Party and Indemnitee shall be determined by reference to, among other things, whether the misstatement or alleged misstatement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such Indemnifying Party or Indemnified Party, and the Parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

(b) The Parties agree that it would not be just and equitable if contribution pursuant to this Section 7.6 were determined by a pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in Section 7.6(a). The amount paid or payable by an Indemnitee as a result of the Liabilities referred to in Section 7.6(a) shall be deemed to include, subject to the limitations set forth above, any legal or other fees or expenses reasonably incurred by such Indemnitee in connection with investigating any claim or defending any Action. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

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Section 7.7 Indemnification Obligations Net of Insurance Proceeds and Other Amounts on a Net-Tax Basis.

(a) Any Liability subject to indemnification or contribution pursuant to this ARTICLE VII, including in respect of any Unallocated Liability, will (i) be net of Insurance Proceeds that actually reduce the amount of the Indemnifiable Loss, (ii) be net of any proceeds received by the Indemnitee from any third party for indemnification for such Liability that actually reduce the amount of the Indemnifiable Loss (“Third Party Proceeds”) and (iii) be determined on a Net-Tax Basis. Accordingly, the amount which any Indemnifying Party is required to pay to any Indemnitee pursuant to this ARTICLE VII will be reduced by any Insurance Proceeds or Third Party Proceeds theretofore actually recovered by or on behalf of the Indemnitee in respect of the related Indemnifiable Loss. If an Indemnitee receives a payment required by this Agreement from an Indemnifying Party in respect of any Indemnifiable Loss (an “Indemnity Payment”) and subsequently receives Insurance Proceeds or Third Party Proceeds, then the Indemnitee will pay to the Indemnifying Party an amount equal to the excess of the Indemnity Payment received over the amount of the Indemnity Payment that would have been due if the Insurance Proceeds or Third Party Proceeds had been received, realized or recovered before the Indemnity Payment was made.

(b) An insurer who would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of the indemnification and contributions provisions hereof, have any subrogation rights with respect thereto. The Indemnitee shall use commercially reasonable efforts to seek to collect or recover any Insurance Proceeds and any Third Party Proceeds to which the Indemnified Party is entitled in connection with any Indemnifiable Loss for which the Indemnified Party seeks contribution or indemnification pursuant to this ARTICLE VII; provided, that the Indemnitee’s inability to collect or recover any such Insurance Proceeds or Third Party Proceeds shall not limit the Indemnifying Party’s obligations hereunder.

(c) The term “Net-Tax Basis” as used in this ARTICLE VII means that, in determining the amount of the payment necessary to indemnify any party against, or reimburse any party for, Indemnifiable Losses, the amount of such Liabilities will be determined net of any reduction in Taxes actually realized by the Indemnitee as the result of sustaining or paying such Indemnifiable Losses after taking into account any Tax incurred on the receipt of Insurance Proceeds, and the amount of such Indemnity Payment will be increased (i.e., “grossed up”) by the amount necessary to satisfy any income or franchise Tax Liabilities that will be incurred by the Indemnitee as a result of its receipt of, or right to receive, such Indemnity Payment (as so increased), so that the Indemnitee is put in the same net after-Tax economic position as if it had not incurred such Liabilities, in each case without taking into account any impact on the Tax basis that an Indemnitee has in its Assets.

Section 7.8 Additional Matters; Survival of Indemnities.

(a) The indemnity and contribution agreements contained in this ARTICLE VII shall remain operative and in full force and effect, regardless of (i) any investigation made by or on behalf of any Indemnitee; and (ii) the knowledge by the Indemnitee of Indemnifiable Losses for which it might be entitled to indemnification or contribution hereunder.

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(b) The rights and obligations of each Party and their respective Indemnitees under this ARTICLE VII shall survive the sale or other Transfer by any Party or its respective Subsidiaries of any Assets or Businesses or the assignment by it or its respective Subsidiaries of any and all Liabilities.

(c) In the event that any third Person or “group” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) acquires, including by way of merger, consolidation or other business combination, fifty percent (50%) or more of the assets or voting equity of either Parent or Spinco, Parent or Spinco, as applicable, shall take all necessary action so that such third Person or group shall become a guarantor of the obligations of Parent or Spinco, as applicable, under this Agreement and the Ancillary Agreements.

ARTICLE VIII

CONFIDENTIALITY; ACCESS TO INFORMATION

Section 8.1 Provision of Corporate Records. Other than in circumstances in which indemnification is sought pursuant to ARTICLE VII (in which event the provisions of such Article will govern) and without limiting the applicable provisions of ARTICLE VII, and subject to appropriate restrictions for classified, privileged or Confidential Information:

(a) After the Effective Time, upon the prior written request by Spinco for specific and identified information which relates to Spinco or the conduct of the LDC Business, as the case may be, up to the Effective Time, Parent shall provide, as soon as reasonably practicable following the receipt of such request, appropriate copies of such information (or the originals thereof if Spinco has a reasonable need for such originals) in the possession or control of Parent or any of its Subsidiaries, but only to the extent such items so relate and are not already in the possession or control of Spinco.

(b) After the Effective Time, upon the prior written request by Parent for specific and identified information which relates to Parent or the conduct of any of the Retained Businesses up to the Effective Time, Spinco shall provide, as soon as reasonably practicable following the receipt of such request, appropriate copies of such information (or the originals thereof if Parent has a reasonable need for such originals) in the possession or control of Spinco or any of its Subsidiaries, but only to the extent such items so relate and are not already in the possession or control of Parent.

Section 8.2 Access to Information. Other than in circumstances in which indemnification is sought pursuant to ARTICLE VII (in which event the provisions of such Article will govern) and without limiting the applicable provisions of ARTICLE VII, from and after the Effective Time, each Party shall afford to the other Party and its authorized accountants, counsel and other designated representatives reasonable access during normal business hours, subject to appropriate restrictions for classified, privileged or Confidential Information and to the requirements of any applicable state and/or federal regulation such as a Code of Conduct or Standard of Conduct, to the personnel, properties, and information of such Party and its Subsidiaries insofar as such access is reasonably required by the other Party, and only for the duration such access is required, and relates to such other Party or the conduct of its Business

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prior to the Effective Time. Nothing in this Section 8.2 shall require either Party to violate any agreement with any third party regarding the confidentiality of confidential and proprietary information relating to that third party or its business; provided, however, that in the event that a Party is required to disclose any such information, such Party shall use commercially reasonable efforts to seek to obtain such third party Consent to the disclosure of such information, provided that no Party should be required to pay any money or other consideration to obtain such Consent. Each of the Parties shall inform their respective officers, employees, agents, consultants, advisors, authorized accountants, counsel and other designated representatives who have or have access to the other Party’s Confidential Information of their obligation to hold such information confidential to the same extent as is applicable to the Parties.

Section 8.3 Witness Services. At all times from and after the Effective Time, each of the Parties shall use its commercially reasonable efforts to make available to the other Party, upon reasonable written request, its and its Subsidiaries’ officers, directors, employees, consultants and agents as witnesses to the extent that (i) such Persons may reasonably be required to testify in connection with the prosecution or defense of any Action in which the requesting Party may from time to time be involved (except for claims, demands or Actions between members of each Group) and (ii) there is no conflict in the Action between the requesting Party and the other Party except for the time and effort required in connection with the services of the officers, directors and employees and agents of the other Party.

Section 8.4 Confidentiality.

(a) Notwithstanding any termination of this Agreement, for a period of 2 years from the Effective Time, the Parties shall hold, and shall cause each of their respective Subsidiaries to hold, and shall each cause each of their respective officers, employees, agents, consultants and advisors to hold, in strict confidence, and not to disclose or release or use, for any ongoing or future commercial purpose, without the prior written consent of the other Party, any and all Confidential Information concerning the other Party; provided, that the Parties may disclose, or may permit disclosure of, Confidential Information (i) to their respective auditors, attorneys, financial advisors, bankers and other appropriate consultants and advisors who have a need to know such information for auditing and other non-commercial purposes and are informed of their obligation to hold such information confidential to the same extent as is applicable to the Parties and in respect of whose failure to comply with such obligations, the applicable Party will be responsible (as if such Party failed to so comply), (ii) if the Parties or any of their respective Subsidiaries are required or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements of Law or stock exchange rule, (iii) as required in connection with any legal or other proceeding by one Party against any other Party, or (iv) as necessary in order to permit a Party to prepare and disclose its financial statements, or other required disclosures; provided, further, that each Party (and members of its Group as necessary) may use, or may permit use of, Confidential Information of the other Party in connection with such first Party performing its obligations, or exercising its rights, under this Agreement or any Ancillary Agreement. Notwithstanding the foregoing, in the event that any demand or request for disclosure of Confidential Information is made pursuant to clause (ii) above, each Party, as applicable, shall promptly notify the other of the existence of such request or demand and shall provide the other a reasonable opportunity to seek an appropriate protective order or other remedy, which such Parties will cooperate in obtaining. In the event that such appropriate protective order

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or other remedy is not obtained, the Party whose Confidential Information is required to be disclosed shall or shall cause the other applicable Party or Parties to furnish, or cause to be furnished, only that portion of the Confidential Information that is legally required to be disclosed and shall take commercially reasonable steps to ensure that confidential treatment is accorded such information.

(b) Notwithstanding anything to the contrary set forth herein, (i) the Parties shall be deemed to have satisfied their obligations hereunder with respect to Confidential Information if they exercise the same degree of care (but no less than a reasonable degree of care) as they take to preserve confidentiality for their own similar information and (ii) confidentiality obligations provided for in any agreement between each Party or its Subsidiaries and their respective employees shall remain in full force and effect. Notwithstanding anything to the contrary set forth herein, Confidential Information of any Party in the possession of and used by any other Party as of the Effective Time may continue to be used by such Party in possession of the Confidential Information in and only in the operation of the LDC Business or any of the Retained Businesses, as the case may be; provided, such Confidential Information may be used only so long as the Confidential Information is maintained in confidence and not disclosed in violation of Section 8.4(a). Such continued right to use may not be transferred (directly or indirectly) to any third party without the prior written Consent of the applicable Party, except pursuant to Section 11.9.

(c) Each Party acknowledges that it and the other members of its Group may have in their possession confidential or proprietary information of third parties that was received under confidentiality or non-disclosure agreements with such third party prior to the Effective Time. Such Party will hold, and will cause the other members of its Group and their respective representatives to hold, in strict confidence the confidential and proprietary information of third parties to which they or any other member of their respective Groups has access, in accordance with the terms of any agreements entered into prior to the Effective Time between one or more members of the such Party’s Group (whether acting through, on behalf of, or in connection with, the separated Businesses) and such third parties.

(d) Upon the written request of a Party, the other Party shall promptly, (i) deliver to such requesting Party all original Confidential Information (whether written or electronic) concerning such requesting Party and/or its Subsidiaries, and (ii) if specifically requested by such requesting Party, destroy any copies of such Confidential Information (including any extracts therefrom). Upon the written request of such requesting Party, the other Party shall cause one of its duly authorized officers to certify in writing to such requesting Party that the requirements of the preceding sentence have been satisfied in full.

Section 8.5 Privileged Matters.

(a) Pre-Separation Services. The Parties recognize that legal and other professional services that have been and will be provided prior to the Effective Time have been and will be rendered for the collective benefit of each of the members of each Party’s Group, and that each of the members of each Party’s Group should be deemed to be the client with respect to such pre-Separation services for the purposes of asserting all privileges which may be asserted under applicable Law.

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(b) Post-Separation Services. The Parties recognize that legal and other professional services will be provided following the Effective Time which will be rendered solely for the benefit of Parent or Spinco, as the case may be. With respect to such post-Separation services, the Parties agree as follows:

(i) Spinco shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information which relates solely to the LDC Business, whether or not the privileged information is in the possession of or under the control of Parent or Spinco. Spinco shall also be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information that relates solely to the subject matter of any claims constituting LDC Liabilities, now pending or which may be asserted in the future, in any lawsuits or other proceedings initiated against or by Spinco, whether or not the privileged information is in the possession of or under the control of Parent or Spinco; and

(ii) Parent shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information which relates solely to any Retained Business, whether or not the privileged information is in the possession of or under the control of Parent or Spinco. Parent shall also be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information that relates solely to the subject matter of any claims constituting Retained Business Liabilities, now pending or which may be asserted in the future, in any lawsuits or other proceedings initiated against or by Parent, whether or not the privileged information is in the possession of or under the control of Parent or Spinco.

(c) The Parties agree that they shall have a shared privilege, with equal right to assert or waive, subject to the restrictions in this Section 8.5, with respect to all privileges not allocated pursuant to the terms of Section 8.5(b). All privileges relating to any claims, proceedings, litigation, disputes, or other matters which involve the Parties in respect of which the Parties retain any responsibility or Liability under this Agreement, shall be subject to a shared privilege among them.

(d) No Party may waive any privilege which could be asserted under any applicable Law, and in which the other Party has a shared privilege, without the Consent of the other Party, which shall not be unreasonably withheld or delayed or as provided in subsections (e) or (f) below. Consent shall be in writing, or shall be deemed to be granted unless written objection is made within 30 days after notice upon the other Party requesting such Consent.

(e) In the event of any litigation or dispute between the Parties, or any members of their respective Groups, either Party may waive a privilege in which the other Party or member of such Group has a shared privilege, without obtaining the Consent of the other Party; provided, that such waiver of a shared privilege shall be effective only as to the use of information with respect to the litigation or dispute between the relevant Parties and/or the applicable members of their respective Groups, and shall not operate as a waiver of the shared privilege with respect to third parties.

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(f) If a dispute arises between the Parties or their respective Subsidiaries regarding whether a privilege should be waived to protect or advance the interest of any Party, each Party agrees that it shall negotiate in good faith, shall endeavor to minimize any prejudice to the rights of the other Party, and shall not unreasonably withhold Consent to any request for waiver by the other Party. Each Party specifically agrees that it will not withhold Consent to waiver for any purpose except to protect its own legitimate interests.

(g) Upon receipt by either Party or by any Subsidiary thereof of any subpoena, discovery or other request which arguably calls for the production or disclosure of information subject to a shared privilege or as to which the other Party has the sole right hereunder to assert a privilege, or if any Party obtains knowledge that any of its or any of its Subsidiaries’ current or former directors, officers, agents or employees have received any subpoena, discovery or other requests which arguably calls for the production or disclosure of such privileged information, such Party shall promptly notify the other Party of the existence of the request and shall provide the other Party a reasonable opportunity to review the information and to assert any rights it may have under this Section 8.5 or otherwise to prevent the production or disclosure of such privileged information.

(h) The transfer of all information pursuant to this Agreement is made in reliance on the agreement of the Parties as set forth in Section 8.4 and Section 8.5, to maintain the confidentiality of privileged information and to assert and maintain all applicable privileges. The access to information being granted pursuant to Section 6.5, Section 8.1 and Section 8.2 hereof, the agreement to provide witnesses and individuals pursuant to Section 6.5 and Section 8.3 hereof, the furnishing of notices and documents and other cooperative efforts contemplated by Section 6.5 and Section 8.5 hereof, and the transfer of privileged information between and among the Parties and their respective Subsidiaries pursuant to this Agreement shall not be deemed a waiver of any privilege that has been or may be asserted under this Agreement or otherwise.

Section 8.6 Reimbursement. Except to the extent otherwise contemplated by this Agreement or any Ancillary Agreement, a Party providing information or access to information to the other Party under this ARTICLE VIII shall be entitled to receive from the recipient, upon the presentation of invoices therefore, payments for such amounts, relating to supplies, disbursements and other out-of-pocket expenses, as may be reasonably incurred in providing such information or access to such information.

Section 8.7 Ownership of Information. Any information owned by one Party or any of its Subsidiaries that is provided to a requesting Party pursuant to this ARTICLE VIII shall be deemed to remain the property of the providing Party. Unless specifically set forth herein, nothing contained in this Agreement shall be construed as granting or conferring rights of license or otherwise in any such information.

Section 8.8 Other Agreements.

(a) The rights and obligations granted under this ARTICLE VIII are subject to any specific limitations, qualifications or additional provisions on the sharing, exchange or confidential treatment of information set forth in any Ancillary Agreement.

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(b) In connection with any matter contemplated by this ARTICLE VIII, the Parties will enter into one or more mutually acceptable joint defense agreements so as to maintain to the extent practicable any applicable attorney-client privilege or work product immunity of any member of any Group.

ARTICLE IX

DISPUTE RESOLUTION

Section 9.1 Disputes.

(a) Except as otherwise provided in Section 6.3 with regard to determinations made by the Contingent Claim Committee, any controversy, dispute or claim between the Parties or members of their respective Groups arising out of, in connection with, or in relation to the interpretation, performance, nonperformance, validity, termination or breach of this Agreement or otherwise arising out of, or in any way related to this Agreement or the transactions contemplated hereby, including any claim based on contract, tort, fraud, misrepresentation, statute or constitution (collectively, “Agreement Disputes”) shall be resolved in the manner provided in this ARTICLE IX, which the Parties hereby agree is the sole method for resolving Agreement Disputes.

(b) It is the intent of the Parties to use their respective commercially reasonable efforts to resolve expeditiously any Agreement Dispute that may arise from time to time on a mutually acceptable negotiated basis. In furtherance of the foregoing and except as provided in Section 6.3, in the event of an Agreement Dispute (either directly or because of a member of its Group is involved), either Party may initiate negotiation of any Agreement Dispute among senior management of the other Party by giving the other Party a written notice of the Agreement Dispute (“Dispute Notice”). The Dispute Notice shall include a statement of the Party’s position, a general summary of the arguments supporting that position, the name and title of the Senior Manager who will represent the Party and any other person(s) who will attend settlement meetings.

(c) Within 10 days of receipt of the Dispute Notice, the receiving Party shall submit to the other Party a written response that includes the same information as is required to be contained in the Dispute Notice.

(d) In the event that pursuant to Sections 9.1(b) and (c) hereof the Parties fail to resolve an Agreement Dispute within 30 days of receipt of a Dispute Notice, the Parties agree that, subject to Section 11.20, thereafter either Party shall be free to exercise whatever rights or remedies it may then have at law or in equity but in connection with any judicial proceeding with respect to such matter, each Party agrees to waive its rights, if any to a jury trial and further agrees that any applicable statute of limitations or repose or claim of laches will be tolled during the time the Parties are negotiating an Agreement Dispute pursuant to Sections 9.1(b) and (c). Nothing herein shall deny either Parent or Spinco the right to seek or obtain provisional remedies, including, but not limited to, a preliminary injunction, prior to or during the pendency of the dispute resolution procedures provided for in this Article IX.

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(e) During the time an Agreement Dispute is being handled pursuant to this Article IX, Parent and Spinco shall continue to comply with all terms and provisions of this Agreement, subject to the rights of either Party to terminate or amend this Agreement provided in Section 11.11.

(f) The giving of the Dispute Notice shall be a condition precedent to initiating an Action for an Agreement Dispute that is subject to Section 9.1(d), except as provided in Section 6.3.

(g) Nothing said or disclosed, nor any document produced, in the course of any negotiations, conferences and discussions in connection with efforts to settle an Agreement Dispute that is not otherwise independently discoverable shall be offered or received as evidence or used for impeachment or for any other purpose in any Action, but shall be considered as to have been disclosed for settlement purposes.

Section 9.2 Exclusive Remedy; Limitation on Actions. The Parties agree that indemnification under ARTICLE VII is the exclusive remedy for Indemnifiable Losses incurred by an Indemnitee, except for such indemnification or warranty rights as the Indemnitee may have under an Ancillary Agreement.

ARTICLE X

INSURANCE

Section 10.1 Policies and Rights Included Within Assets.

(a) The LDC Assets shall include (i) the LDC Policies and (ii) any and all rights of any member of the Spinco Group under each of the Shared Policies, subject to the terms of such Shared Policies and any limitations or obligations of any member of the Spinco Group contemplated by this ARTICLE X. The rights under the Shared Policies allocated under this provision specifically include rights of indemnity and the right to be defended by or at the expense of the insurer: (x) with respect to all alleged wrongful acts, claims, suits, actions, proceedings, injuries, losses, Liabilities, damages and expenses incurred or claimed to have been incurred and reported or notified to the insurer per any claims-made policy reporting provision prior to the Distribution Date by any Person in or in connection with the conduct of the LDC Business and (y) any other claim made against Spinco or any of its Subsidiaries that may arise out of an insured or insurable occurrence or wrongful act covered under one or more of such Shared Policies. Nothing in this provision shall be deemed to constitute (or to reflect) an assignment of the Shared Policies, or any of them, to any member of the Spinco Group.

(b) The Retained Business Assets shall include (i) the Retained Business Policies and (ii) the Shared Policies, excluding any rights under the Shared Policies allocated to the Spinco Group pursuant to Section 10.1(a) above.

Section 10.2 Claims Made Tail Policies.

(a) Parent, at Parent’s sole election, shall either (x) secure directors and officers liability insurance policies or (y) modify by endorsement Parent’s existing policies to

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provide total limits of $150 million, consisting of $100 million of traditional A/B/C coverage and $50 million in side A DIC coverage and having an effective date on the Distribution Date and ending on a date that is six years after the effective date (“D&O Tail Policies”). The premium for the D&O Tail Policies or endorsements shall be prepaid for the full six-year term of the D&O Tail Policies or endorsements. Such D&O Tail Policies or endorsements (i) shall cover all Persons insured by those policies who become employees of Spinco comprising the Parent directors and officers liability insurance program that began on June 1, 2013, and (ii) shall have material terms and conditions no less favorable than those contained in the 2013 – 2014 policies, except for the policy period, premium and provisions excluding coverage for wrongful acts postdating the Distribution Date. Parent shall provide Spinco with copies of the D&O Tail Policies or endorsements within a reasonable time after the D&O Tail Policies are issued or Parent’s existing directors and officers liability insurance policies are modified.

(b) Parent, at Parent’s sole election, shall either (x) secure fiduciary liability insurance policies or (y) modify by endorsement Parent’s existing policies, in either case, to provide total limits of $50 million and having an effective date on the Distribution Date and ending on a date that is six years after the effective date (“Fiduciary Tail Policies”). The premium for the Fiduciary Tail Policies or endorsements shall be pre-paid for the full six-year term of the Fiduciary Tail Policies or endorsements. Such Fiduciary Tail Policies or endorsements (i) shall cover all Persons insured by those policies who become employees of Spinco comprising the Parent fiduciary liability insurance program commencing on June 1, 2013, and (ii) shall have material terms and conditions no less favorable than those contained in the 2013 – 2014 policies, except for the policy period, premium and provisions excluding coverage for wrongful acts post-dating the Final Distribution Date. Parent shall provide Spinco with copies of the Fiduciary Tail Policies or endorsements within a reasonable time after the Fiduciary Tail Policies are issued or Parent’s existing fiduciary liability insurance policies are modified.

(c) With respect to any D&O Tail Policies or endorsements and any Fiduciary Tail Policies or endorsements secured under Section 10.2(a) and Section 10.2(b), respectively, the associated premiums incurred shall be apportioned amongst the Parties in the same manner as expenses are allocated among the Parties’ pursuant to Section 11.5 herein.

(d) To the extent that Parent is unable prior to the Final Distribution Date to obtain any of the policies or endorsements as provided for in paragraphs (a) and (b) of this Section 10.2, then, with respect to claims based on wrongful acts on or before the Distribution Date, Parent shall use commercially reasonable efforts to secure alternative insurance arrangements on applicable stand alone insurance policies for Spinco to provide benefits on terms and conditions (including policy limits) in favor of Spinco and the other Persons to be insured no less favorable than the benefits (including policy limits) that were to be afforded by the policies described in paragraphs (a) and (b) of this Section 10.2. With respect to such alternative insurance arrangements, Parent and Spinco shall be responsible for the premium and any other costs under their applicable stand alone insurance policies. Parent shall not under any circumstances purchase any such alternative coverage containing an exclusion for claims based on wrongful acts up to and including the Distribution Date to the extent such exclusion would preclude coverage for Spinco and other Persons to be insured under the stand alone policies, if Parent has obtained substantially similar tail-risk insurance coverage for itself on a stand alone basis without that exclusion.

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(e) With respect to the D&O Tail Policies or endorsements and Fiduciary Tail Policies or endorsements, Parent and Spinco shall be severally responsible for bearing the full amount of any deductibles, co-payments and/or any claims, costs and expenses (“Insurance Expenses”) that are not covered under or are required by such insurance policies, to the extent attributable to claims against each or reasonably allocated to each based on the nature of such claim (i.e., primarily related to the LDC Business or any of the Retained Businesses), or if such claim is not primarily related to the LDC Business or any of the Retained Businesses, in the proportion that the premium of such D&O Tail Policy or endorsements or Fiduciary Tail Policy or endorsements has been allocated pursuant to Section 10.2(c).

Section 10.3 Occurrence Based Policies.

(a) With respect to the occurrence-based Shared Policies which include workers’ compensation/employer’s liability, automobile liability and aircraft liability, for claims against any member of the Spinco Group that occur prior to the Distribution Date, Parent will continue to provide the Spinco Group with access to such Shared Policies.

(b) Parent shall reasonably cooperate with the Spinco Group and take commercially reasonable actions as may be necessary or advisable to assist the Spinco Group in submitting such claims to which such occurrence-based Shared Policies are responsive; provided, that Spinco shall be responsible for any premium adjustments, deductibles, deposits, cash collateral or co-payments legally due and owing or required relating to such claims and Parent shall not be required to maintain such occurrence-based Shared Policies beyond their current terms.

Section 10.4 Claims-Made or Similarly Based Policies.

(a) With respect to the claims-made Shared Policies which include excess/umbrella liability and punitive damages liability, for claims against any member of the Spinco Group which arise from occurrences and lawsuits noticed to the Shared Policies’ insurers prior to the Distribution Date, Parent will continue to provide the Spinco Group with access to such Shared Policies.

(b) Parent shall reasonably cooperate with the Spinco Group and take commercially reasonable actions as may be necessary or advisable to assist the Spinco Group in submitting such notices prior to the Distribution Date to which such claims-made Shared Policies are responsive; provided, that Spinco shall be responsible for any premium adjustments, deductibles, deposits, cash collateral or co-payments legally due and owing or required relating to claims arising from such occurrences and lawsuits noticed and Parent shall not be required to maintain such claims-made Shared Policies beyond their current terms.

Section 10.5 Administration; Other Matters.

(a) Administration. Except as otherwise provided in Section 10.3 and Section 10.4 hereof, from and after the Effective Time, Parent shall be responsible for (i) Insurance Administration of the Shared Policies and (ii) Claims Administration of the Shared Policies with respect to Retained Business Liabilities and LDC Liabilities; provided, that the retention of such responsibilities by Parent is in no way intended to limit, inhibit or preclude any right to insurance coverage for any Insured Claim of Spinco under the Shared Policies as contemplated by the terms

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of this Agreement; and provided, further, that Parent’s retention of the administrative responsibilities for the Shared Policies shall not relieve the Party (or member of its Group) submitting any Insured Claim of the primary responsibility for reporting such Insured Claim accurately, completely, in a timely manner and in accordance with the Shared Policies reporting provisions or of such Party (or member of its Group’s) authority to settle any such Insured Claim within any period permitted or required by the relevant policy. Parent may discharge its administrative responsibilities under this Section 10.5 by contracting for the provision of services by independent parties. Each of the applicable Parties shall pay any costs relating to defending its respective Insured Claims under Shared Policies and any claims falling under the self-insured permits for workers’ compensation and auto liability exposures in the state of Kansas and Oklahoma to the extent such costs including defense, out-of-pocket expenses, and direct and indirect costs of employees or agents of Parent related to Claims Administration and Insurance Administration are not covered under such Shared Policies. In the absence of another agreed arrangement for a claim or particular claims, Parent shall determine and invoice the costs to be paid by Spinco using commercially reasonable methods consistently applied. Each of the Parties shall be responsible for obtaining or reviewing the appropriateness of releases upon settlement of its respective Insured Claims under Shared Policies or self-insured claims under the self-insured permits.

(b) Exceeding Policy Limits. Where Retained Business Liabilities and/or LDC Liabilities, as applicable, are specifically covered under the same Shared Policy for periods prior to the Distribution Date, or where such Shared Policies cover claims made after the Distribution Date with respect to an occurrence or wrongful act committed and/or noticed or reported as applicable wholly prior to the Distribution Date, then from and after the Distribution Date, a member of the Parent Group and/or the Spinco Group may claim coverage for Insured Claims under such Shared Policy as and to the extent that such insurance is available up to the full extent of the applicable limits of liability of such Shared Policy (and may receive any Insurance Proceeds with respect thereto as contemplated by Section 10.2, Section 10.3, Section 10.4 or Section 10.5(c) hereof), subject to the terms of this Section 10.5. Except as set forth in this Section 10.5, Parent and Spinco shall not be liable to one another for claims not reimbursed by insurers for any reason, including coinsurance provisions, deductibles, quota share deductibles, self-insured retentions, bankruptcy or insolvency of an insurance carrier, Shared Policy limitations or restrictions, any coverage disputes, any failure to timely claim by Parent and Spinco or any defect in such claim or its processing. It is expressly understood that the foregoing shall not limit any Party’s liability to any Indemnitee for indemnification pursuant to ARTICLE VII.

(c) Allocation of Insurance Proceeds. Except as otherwise provided in Section 10.3 and Section 10.4, and where not in conflict with or prohibited by specific insurance policy conditions, Insurance Proceeds received with respect to claims, costs and expenses under the Shared Policies shall be paid to or on behalf of Parent, which shall thereafter administer the Shared Policies by paying the Insurance Proceeds, as appropriate, to Parent with respect to Retained Business Liabilities or, to Spinco with respect to LDC Liabilities. Payment of the allocable portions of indemnity costs of Insurance Proceeds resulting from such Shared Policies will be made by Parent to the appropriate Party upon receipt from the insurance carrier. In the event that the aggregate limits on any Shared Policies are exceeded by the aggregate of outstanding Insured Claims by members of the two Groups, the relevant Parties agree to allocate the Insurance Proceeds received for those Insured Claims based upon which relevant Group had

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such Insured Claim, or if the relevant Group is undeterminable, based upon which relevant Group was originally allocated the insurance premium (their “Allocable Portion of Insurance Proceeds”), and any Party who has received Insurance Proceeds in excess of such Party’s Allocable Portion of Insurance Proceeds shall pay to the other Party the appropriate amount so that each Party will have received its Allocable Portion of Insurance Proceeds pursuant hereto. The Parties agree to use commercially reasonable efforts to maximize available coverage under those Shared Policies applicable to it, and to take all commercially reasonable steps to recover from all other responsible parties in respect of an Insured Claim to the extent coverage limits under a Shared Policy have been exceeded or would be exceeded as a result of such Insured Claim. In the event that the aggregate limits on any Shared Policies are exceeded by the aggregate of outstanding Insured Claims, the Parties will negotiate with the Shared Policies’ insurers for a full reinstatement of such Shared Policies’ aggregate limits for their mutual benefits. Costs for such reinstatement to be borne by the Parties based on their Allocated Portion of the Insurance Proceeds attributable to that policy’s Insured Claims.

Section 10.6 Agreement for Waiver of Conflict and Shared Defense. In the event that Insured Claims or self-insured claims by members of more than one Group exist relating to the same occurrence, the Parties shall jointly defend to the extent permitted by applicable Law and rules of professional responsibility applicable to legal counsel for the defense. Nothing in this Section 10.6 shall be construed to limit or otherwise alter in any way the obligations of the Parties to this Agreement, including those created by this Agreement, by operation of Law or otherwise.

Section 10.7 Cooperation. The Parties agree to use their commercially reasonable efforts to cooperate with respect to the various insurance matters contemplated by this Agreement.

Section 10.8 Miscellaneous.

(a) Nothing in this Agreement shall be deemed to restrict Parent or Spinco, or any members of their respective Groups, from acquiring at its own expense any Insurance Policy in respect of any Liabilities or covering any period. Except as otherwise provided in this ARTICLE X, from and after the Distribution Date, Parent and Spinco shall be responsible for obtaining and maintaining their respective insurance programs for their risk of loss and such insurance arrangements shall be separate programs apart from each other and each will be responsible for its own premium payments, deductibles and/or retentions for such insurance programs. Further, Parent and Spinco shall be responsible individually after the Distribution Date for qualifying, obtaining and maintaining their respective self-insurance permits as applicable as respects their risk of loss in the states of Kansas and Oklahoma or procuring such insurance as may be deemed appropriate for their own risk.

(b) Each of the Parties intends by this Agreement that a third – party Person, including a third – party insurer or reinsurer, or other third – party Person that, in the absence of the Agreement would otherwise be obligated to pay any claim or satisfy any indemnity or other obligation, shall not be relieved of the responsibility with respect thereto and shall not be entitled to a “windfall” (i.e., avoidance of the obligation that such Person would have in the absence of this Agreement). To the extent that any such Person would receive such a windfall, the Parties shall negotiate in good faith concerning an amendment of this Agreement.

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ARTICLE XI

MISCELLANEOUS

Section 11.1 Complete Agreement; Construction. This Agreement, including its Exhibits and Schedules, and the Ancillary Agreements shall constitute the entire agreement between the Parties with respect to the subject matter hereof and shall supersede all previous negotiations, commitments, courses of dealing and writings with respect to such subject matter. In the event of any inconsistency between this Agreement and any Schedule hereto, the Schedule shall prevail. In the event and to the extent that there shall be a conflict between the provisions of this Agreement and the provisions of any Ancillary Agreement, such Ancillary Agreement shall control; provided, that, subject to Section 2.13(e), with respect to any Conveyancing and Assumption Instrument, this Agreement shall control, unless specifically stated otherwise in such Conveyancing and Assumption Instrument.

Section 11.2 Ancillary Agreements. This Agreement is not intended to address, and should not be interpreted to address, the matters specifically and expressly covered by the Ancillary Agreements.

Section 11.3 Counterparts; Electronic Delivery. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which taken together shall be considered one and the same agreement, and, except as otherwise expressly provided in Section 1.3, shall become effective when one or more such counterparts have been signed by each Party and delivered to each Party. Execution and delivery of this Agreement or any other documents pursuant to this Agreement by facsimile or other electronic means shall be deemed to be, and shall have the same legal effect as, execution by an original signature and delivery in person.

Section 11.4 Survival of Agreements. Except as otherwise contemplated by this Agreement or any Ancillary Agreement, all covenants and agreements of the Parties contained in this Agreement and each Ancillary Agreement shall survive the Effective Time and remain in full force and effect in accordance with their applicable terms.

Section 11.5 Expenses.

(a) (i) Except as otherwise expressly provided (x) in this Agreement (including paragraphs (a)(ii), (b) and (c) of this Section 11.5) or (y) in any Ancillary Agreement, the Parties agree that all out-of-pocket costs, fees and expenses (including the costs to obtain any Consents) incurred and directly related to the transactions contemplated hereby, including any Liability incurred following the Separation as a result of the consummation of the Separation, shall be borne and paid by the Person incurring such cost or Liability, and (ii) the costs and expenses described on Schedule 11.5(a)(ii) shall be paid by the Party to which such costs and expenses are allocated thereon.

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(b) Each Party shall be responsible for payment of its respective outside advisors for all work performed, whether in connection with the Separation or otherwise, prior to, on or after the Effective Time, provided, however, that Parent shall pay all fees earned, and all costs and expenses incurred, prior to the Distribution Date directly related to the Separation by the entities listed or described on Schedule 11.5(b) and payable to such entities.

(c) With respect to any expenses incurred pursuant to a request for further assurances granted under Section 2.9, the Parties agree that such expenses shall be borne and paid by the Party incurring such expense in complying with such request; it being understood that no Party shall be obliged to incur any third-party accounting, consulting, advisor, banking or legal fees, costs or expenses, and the requesting Party shall not be obligated to pay such fees, costs or expenses, unless such fee, cost or expense shall have had the prior written approval of the requesting Party.

Section 11.6 Notices All notices, requests, claims, demands and other communications under this Agreement and, to the extent applicable and unless otherwise provided therein, under each of the Ancillary Agreements shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt unless the day of receipt is not a Business Day, in which case it shall be deemed to have been given on the next Business Day) by delivery in person, by overnight courier service, by facsimile with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective Party or Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 11.6):

To Parent:

ONEOK, Inc.

100 W. Fifth Street

Tulsa, Okla. 74103

Attn: General Counsel

Facsimile: [                    ]

To Spinco:

ONE Gas, Inc.

15 E. Fifth Street

Tulsa, Okla. 74103

Attn: General Counsel

Facsimile: [                    ]

Section 11.7 Waivers and Consents. The failure of any Party to require strict performance by the other Party of any provision in this Agreement will not waive or diminish that Party’s right to demand strict performance thereafter of that or any other provision hereof. Any Consent required or permitted to be given by any Party to the other Party under this Agreement shall be in writing and signed by the Party giving such Consent.

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Section 11.8 Amendments. Subject to the terms of Section 11.11, this Agreement may not be modified or amended except by an agreement in writing signed by each Party.

Section 11.9 Assignment. Except as otherwise expressly provided for in this Agreement, this Agreement shall not be assignable, in whole or in part, directly or indirectly, by either Party without the prior written Consent of the other Party, and any attempt to assign any rights or obligations arising under this Agreement without such Consent shall be null and void; provided, that a Party may assign this Agreement in connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of its Assets; provided, that the surviving entity of such merger or the transferee of such Assets shall agree in writing, reasonably satisfactory to the other Party, to be bound by the terms of this Agreement as if named as a “Party” hereto. In addition, in the event that any third Person or “group” (as such term is used in Section 13(d) and 14(d) of the Exchange Act) acquires, including by way of merger, consolidation or other business combination, fifty percent or more of the consolidated assets or voting equity of either Parent or Spinco, such Party, as applicable, shall take all necessary action so that such third Person or group shall become a guarantor of the obligations of Parent or Spinco, as applicable, under this Agreement and each of the Ancillary Agreements.

Section 11.10 Successors and Assigns. Subject to Section 11.9, the provisions of this Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors and permitted transferees and assigns.

Section 11.11 Certain Termination and Amendment Rights. This Agreement (including ARTICLE VII hereof) may be terminated and the Distribution may be amended, modified or abandoned at any time prior to the Distribution Date by and in the sole discretion of Parent without the approval of Spinco or the stockholders of Parent. In the event of such termination, no Party shall have any Liability of any kind to any other Party or any other Person. After the Distribution Date, this Agreement may not be terminated except by an agreement in writing signed by Parent and Spinco. Notwithstanding the foregoing, ARTICLE VII shall not be terminated or amended after the Effective Time in a manner adverse to the third party beneficiaries thereof without the Consent of any such Person.

Section 11.12 Payment Terms.

(a) Except as expressly provided to the contrary in this Agreement or in any Ancillary Agreement, any amount to be paid or reimbursed by any Party (and/or a member of such Party’s Group), on the one hand, to the other Party (and/or a member of such Party’s or Parties’ Group), on the other hand, under this Agreement shall be paid or reimbursed hereunder within 30 days after presentation of an invoice or a written demand therefore and setting forth, or accompanied by, reasonable documentation or other reasonable explanation supporting such amount.

(b) Except as expressly provided to the contrary in this Agreement or in any Ancillary Agreement, any amount not paid when due pursuant to this Agreement shall bear

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interest at a rate per annum equal to the then effective Prime Rate plus 2% (or the maximum legal rate, whichever is lower), calculated for the actual number of days elapsed, accrued from the date on which such payment was due up to the date of the actual receipt of payment.

Section 11.13 No Circumvention. The Parties agree not to directly or indirectly take any actions, act in concert with any Person who takes an action, or cause or allow any member of any such Party’s Group to take any actions (including the failure to take a reasonable action) such that the resulting effect is to materially undermine the effectiveness of any of the provisions of this Agreement or any Ancillary Agreement (including adversely affecting the rights or ability of any Party to successfully pursue indemnification, contribution or payment pursuant to ARTICLE VII).

Section 11.14 Subsidiaries. Each of the Parties shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein to be performed by any Subsidiary of such Party or by any entity that becomes a Subsidiary of such Party on and after the Effective Time. The Parties acknowledge that certain actions, agreements and obligations that certain of their Affiliates and Subsidiaries may be required to perform in connection with the performance of the Parties’ obligations under this Agreement or any Ancillary Agreement may require Governmental Approval by Governmental Entities under applicable Law, and therefore agree that performance of such actions, agreements and obligations is subject to the receipt of all such necessary Governmental Approvals, which approvals each Party shall, and shall cause the members of its respective Group to, use its commercially reasonable efforts to obtain.

Section 11.15 Third Party Beneficiaries. Except (i) as provided in ARTICLE VII relating to Indemnitees and for the release under Section 7.1 of any Person provided therein (ii) as provided in Section 10.2 relating to insured persons and Section 5.4 relating to the directors, officers, employees, fiduciaries or agents provided therein and (iii) except as specifically provided in any Ancillary Agreement, this Agreement is solely for the benefit of the Parties and should not be deemed to confer upon third parties any remedy, claim, liability, reimbursement, cause of action or other right in excess of those existing without reference to this Agreement.

Section 11.16 Title and Headings. Titles and headings to Sections and Articles are inserted for the convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

Section 11.17 Exhibits and Schedules. The Exhibits and Schedules attached hereto are incorporated herein by reference and shall be construed with and as an integral part of this Agreement to the same extent as if the same had been set forth verbatim herein.

Section 11.18 Closing. The closing and consummation of the transactions contemplated by this Agreement to occur prior to or at the Distribution Date shall take place at the offices of Parent, ONEOK Plaza, 100 West Fifth Street, Tulsa, OK 74103.

Section 11.19 Governing Law. This Agreement shall be governed by and construed in accordance with the internal Laws, and not the Laws governing conflicts of Laws, of the State of Oklahoma.

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Section 11.20 Consent to Jurisdiction. Subject to the provisions of ARTICLE IX herein, each of the Parties irrevocably submits to the exclusive jurisdiction of (a) the District Court of the State of Oklahoma for Tulsa County, and (b) the United States District Court for the Northern District of Oklahoma, Tulsa Division (the “Oklahoma Courts”), for the purposes of any suit, Action or other proceeding in accordance with ARTICLE IX or for provisional relief to prevent irreparable harm, and to the non-exclusive jurisdiction of the Oklahoma Courts for the enforcement of any award issued thereunder. Each of the Parties further agrees that service of any process, summons, notice or document by United States registered mail or receipted courier service to such Party’s respective address set forth in Section 11.6 shall be effective service of process for any Action, suit or proceeding in the Oklahoma Courts with respect to any matters to which it has submitted to jurisdiction in this Section 11.20. Each of the Parties irrevocably and unconditionally waives any objection to the laying of venue of any Action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby in the Oklahoma Courts, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

Section 11.21 Specific Performance. The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled to (i) an injunction or injunctions to enforce specifically the terms and provisions hereof in any Action in accordance with ARTICLE IX, (ii) provisional or temporary injunctive relief in accordance therewith in any Oklahoma Court, and (iii) enforcement of any such award of an arbitral tribunal or a Oklahoma Court in any court of the United States, or any other any court or tribunal sitting in any state of the United States or in any foreign country that has jurisdiction, this being in addition to any other remedy or relief to which they may be entitled.

Section 11.22 Waiver of Jury Trial. Subject to ARTICLE IX and Sections 11.20 and 11.21 herein, each of the Parties hereby waives to the fullest extent permitted by applicable Law any right it may have to a trial by jury with respect to any court proceeding contemplated by Section 11.20 of this Agreement. Each of the Parties hereby (a) certifies that no representative, agent or attorney of the other Party has represented, expressly or otherwise, that such other Party would not, in the event of litigation, seek to enforce the foregoing waiver and (b) acknowledges that it has been induced to enter into this Agreement and the transactions contemplated by this Agreement, as applicable, by, among other things, the mutual waivers and certifications in this Section 11.22.

Section 11.23 Severability. In the event any one or more of the provisions contained in this Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby, and the Parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

Section 11.24 Force Majeure. No Party (or any Person acting on its behalf) shall have any Liability or responsibility for failure to fulfill any obligation (other than a payment obligation) under this Agreement or, unless otherwise expressly provided therein, any Ancillary

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Agreement, so long as and to the extent to which the fulfillment of such obligation is prevented, frustrated, hindered or delayed as a consequence of circumstances of Force Majeure (as defined in Section 1.1(42)). A Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event: (a) notify the other Party of the nature and extent of any such Force Majeure condition, and (b) use due diligence to remove any such causes and resume performance under this Agreement as soon as reasonably practicable.

Section 11.25 Interpretation. The Parties have participated jointly in the negotiation and drafting of this Agreement. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the Party drafting or causing any instrument to be drafted.

Section 11.26 Authorization. Each of the Parties hereby represents and warrants that it has the power and authority to execute, deliver and perform this Agreement, that this Agreement has been duly authorized by all necessary corporate action on the part of such Party, that this Agreement constitutes a legal, valid and binding obligation of each such Party and that the execution, delivery and performance of this Agreement by such Party does not contravene or conflict with any provision of Law or of its charter or bylaws or any material agreement, instrument or order binding on such Party.

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first above written.

ONEOK, INC.                                                 

By                                                                                  

Name:

Title:

Date:

ONE GAS, INC.                                     

By                                                                                  

Name:

Title:

Date:

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EX-4.2

Exhibit 4.2

NUMBER OGS ONE Gas INCORPORATED UNDER THE LAWS OF THE STATE OF OKLAHOMA SHARES SEE REVERSE SIDE FOR CERTAIN DEFINITIONS CUSIP 68235P 10 8 THIS CERTIFIES THAT BY is the owner of WELLS COUNTERSIGNED FULLY PAID AND NON-ASSESSABLE COMMON SHARES, $0.01 PAR VALUE, OF FARGO AND ONE Gas, Inc. BANK, transferable on the books of the Corporation by the holder hereof in person or by Attorney upon surrender of this certificate properly . N endorsed. This certificate is not valid until countersigned and registered by the Transfer Agent and Registrar. COMMON . A REGISTERED: IN WITNESS WHEREOF, the said Corporation has caused this certificate to be signed by facsimile signatures of its duly authorized officers. Dated: AUTHORIZED AND TRANSFER PRESIDENT AND CHIEF EXECUTIVE OFFICER VICE PRESIDENT, ASSOCIATE GENERAL SIGNATURE REGISTRAR AGENT COUNSEL AND SECRETARY AMERICAN FINANCIAL PRINTING INCORPORATED – MINNEAPOLIS

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: UTMA –Custodian TEN COM – as tenants in common (Cust) (Minor) TEN ENT – as tenants by entireties under Uniform Transfers to Minors JT TEN – as joint tenants with right of survivorship Act and not as tenants in common (State) Additional abbreviations may also be used though not in above list. For value received hereby sell, assign, and transfer unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING ZIP CODE OF ASSIGNEE) Shares of the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint Attorney to transfer the said stock on the books of the within-named Corporation with full power of substitution in the premises. Dated X X NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. SIGNATURE GUARANTEED ALL GUARANTEES MUST BE MADE BY A FINANCIAL INSTITUTION (SUCH AS A BANK OR BROKER) WHICH IS A PARTICIPANT IN THE SECURITIES TRANSFER AGENTS MEDALLION PROGRAM (“STAMP”), THE NEW YORK STOCK EXCHANGE, INC. MEDALLION SIGNATURE PROGRAM (“MSP”), OR THE STOCK EXCHANGES MEDALLION PROGRAM (“SEMP”) AND MUST NOT BE DATED. GUARANTEES BY A NOTARY PUBLIC ARE NOT ACCEPTABLE.

EX-10.5

Exhibit 10.5

INDEMNIFICATION AGREEMENT

This Indemnification Agreement (“Agreement”) is made as of             , 20     by and between ONE Gas, Inc., an Oklahoma corporation (the “Corporation”), and                      (“Indemnitee”).

RECITALS

WHEREAS, the Corporation desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve the Corporation; and

WHEREAS, in order to induce Indemnitee to continue to provide services to the Corporation, the Corporation wishes to provide for the indemnification of, and advancement of expenses to, Indemnitee to the maximum extent permitted by law; and

WHEREAS, the Corporation’s Bylaws (as amended, the “Bylaws”) require indemnification of the directors, officers, employees and agents of the Corporation and Indemnitee may also be entitled to indemnification pursuant to the Oklahoma General Corporation Act (as amended, the “OGCA”); and

WHEREAS, the Bylaws and the OGCA expressly provide that the indemnification provisions set forth therein are not exclusive, and thereby contemplate that contracts may be entered into between the Corporation and members of its board of directors, officers and other persons with respect to indemnification; and

WHEREAS, the Corporation and Indemnitee recognize the continued difficulty in obtaining liability insurance for the Corporation’s directors, officers, employees and agents, the significant and continual increases in the cost of such insurance and the general trend of insurance companies to reduce the scope of coverage of such insurance; and

WHEREAS, the Corporation and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees and agents to expensive litigation risks at the same time as the availability and scope of coverage of liability insurance provide increasing challenges for the Corporation; and

WHEREAS, the Board of Directors of the Corporation (the “Board”) has determined that the increased difficulty in attracting and retaining highly qualified persons such as Indemnitee is detrimental to the best interests of the Corporation’s shareholders and that the Corporation should act to assure Indemnitee that there will be increased certainty of such protection in the future; and

WHEREAS, it is reasonable, prudent and necessary for the Corporation to contractually obligate itself to indemnify, and to advance expenses on behalf of, Indemnitee to the fullest extent permitted by applicable law, regardless of any amendment or revocation of the Bylaws, so that Indemnitee will serve or continue to serve the Corporation free from undue concern that Indemnitee will not be so indemnified; and

WHEREAS, this Agreement is a supplement to and in furtherance of the indemnification provided in the Bylaws and any resolutions adopted pursuant thereto and the OGCA, and shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Corporation and Indemnitee do hereby covenant and agree as follows.

Section 1. Definitions

As used in this Agreement:

(a) “Corporate Status” shall mean the status of a person as a current or former director, officer, employee or agent of the Corporation or a director, officer, employee, agent, trustee, consultant or fiduciary of any other Enterprise which such person is or was serving at the request of the Corporation.

(b) “Enforcement Expenses” shall mean all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees and all other disbursements or expenses of the types customarily incurred in connection with an action to enforce indemnification or advancement rights, or an appeal from such action, including, without limitation, the premium, security for and other costs relating to any cost bond, supersedes bond or other appeal bond or its equivalent.

(c) “Enterprise” shall mean any corporation (other than the Corporation), limited liability company, partnership, joint venture, trust, employee benefit plan or other legal entity of which Indemnitee is or was serving at the request of the Corporation as a director, officer, employee, agent, trustee, consultant or fiduciary.

(d) “Expenses” shall mean all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, ERISA and other excise taxes and penalties, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding or an appeal resulting from a Proceeding, including, without limitation, the premium, security for and other costs relating to any cost bond, supersedes bond or other appeal bond or its equivalent. Expenses shall also include Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise. The parties agree that for the purposes of any advancement of Expenses for which Indemnitee has made written demand to the Corporation in accordance with this Agreement, all Expenses included in such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable shall be presumed conclusively to be reasonable. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

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(e) “Independent Counsel” shall mean a law firm, or a partner (or, if applicable, member) of such a law firm, that is experienced in matters of Oklahoma corporation law and neither presently is, nor in the past two years has been, retained to represent: (i) the Corporation, any Enterprise or Indemnitee in any matter material to any such party (other than with respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Corporation or Indemnitee in an action to determine Indemnitee’s rights under this Agreement. The Corporation agrees to pay the reasonable fees and expenses of the Independent Counsel and to fully indemnify such counsel against any and all expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.

(f) “Proceeding” shall mean any threatened, pending or completed action, suit, arbitration, mediation, alternative dispute resolution mechanism or proceeding, whether brought in the right of the Corporation or otherwise, or whether civil, criminal, administrative, legislative, or investigative, in which Indemnitee was, is or may be involved as a party or otherwise, by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee, agent, trustee, consultant or fiduciary of any Enterprise or by reason of any action taken by him or of any action taken on his part while acting as director, officer, employee or agent of the Corporation, or while serving at the request of the Corporation as a director, officer, employee, agent, trustee, consultant or fiduciary of any Enterprise, in each case whether or not serving in such capacity at the time any liability or expense is incurred for which indemnification, reimbursement, or advancement of expenses can be provided under this Agreement. If the Indemnitee believes in good faith that a given situation may lead to or culminate in the institution of a Proceeding, such situation shall be considered a Proceeding under this paragraph. The term “Proceeding” shall not include any action, suit or arbitration, or part thereof, initiated by Indemnitee to enforce Indemnitee’s rights under this Agreement as provided for in Section 13(e) of this Agreement.

Section 2. Proceedings Other Than by or in the Right of the Corporation. The Corporation shall indemnify Indemnitee in accordance with the provisions of this Section 2 if Indemnitee was or is or is threatened to be made, a party to any Proceeding (other than a Proceeding by or in the right of the Corporation, which is covered by Section 3 of this Agreement) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee, agent, trustee, consultant or fiduciary of any Enterprise, against Expenses, judgments, fines, penalties and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses, judgments, fines, penalties and amounts paid in settlement) actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with the defense or settlement of such Proceeding, or any claim, issue or matter related thereto, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Corporation,

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and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful. The termination of any action, suit, investigation or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, that the Indemnitee had reasonable cause to believe that the Indemnitee’s conduct was unlawful. Indemnitee shall not enter into any settlement in connection with a Proceeding without ten (10) days’ prior written notice to the Corporation. The parties hereto intend that this Agreement shall provide, to the fullest extent permitted by law, for indemnification in excess of that expressly permitted by statute, including, without limitation, any indemnification provided by the Bylaws or applicable law.

Section 3. Proceedings by or in the Right of the Corporation. The Corporation shall indemnify Indemnitee in accordance with the provisions of this Section 3 if Indemnitee was or is a party to or is threatened to be made a party to any Proceeding by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee, agent, trustee, consultant or fiduciary of any Enterprise against Expenses, judgments, fines, penalties and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses, judgments, fines, penalties and amounts paid in settlement) actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with the defense or settlement of such Proceeding, or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Corporation except that no indemnification for Expenses shall be made under this Section 3 in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Corporation unless and only to the extent that any Federal court of the United States of America located in the State of Oklahoma, or, if such court lacks subject matter jurisdiction, an Oklahoma district court (collectively, the “Oklahoma Court”) or the court in which the Proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such Expenses which the Oklahoma Court or such other court shall deem proper.

Section 4. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provisions of this Agreement and except as provided in Section 8, to the extent that Indemnitee has been successful on the merits or otherwise in defense of any Proceeding, or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against Expenses actually and reasonably incurred by Indemnitee in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Corporation shall indemnify Indemnitee against all Expenses actually and reasonably incurred by him or on his behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter. Nothing in this Section 4 is intended to limit Indemnitee’s rights provided for in Sections 2 and 3.

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Section 5. Indemnification For Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a witness or otherwise asked to participate in any Proceeding to which Indemnitee is not a party and is not threatened to be made a party, he shall be indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith. Nothing in this Section 5 is intended to limit Indemnitee’s rights provided for in Sections 2, 3 and 4.

Section 6. Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Corporation for some or a portion of Expenses, but not, however, for the total amount thereof, the Corporation shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.

Section 7. Additional Indemnification.

(a) Except as provided in Section 8, and notwithstanding any limitation in Sections 2, 3, or 4, the Corporation shall indemnify Indemnitee to the fullest extent permitted by law if Indemnitee is a party to or is threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the Corporation to procure a judgment in its favor) against all Expenses, penalties, judgments, fines, and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses, judgments, fines, penalties and amounts paid in settlement) actually and reasonably incurred by Indemnitee in connection with the Proceeding.

(b) For purposes of Section 7(a), the meaning of the phrase “to the fullest extent permitted by law” shall include, but not be limited to:

i. to the fullest extent permitted by the provisions of the OGCA that authorizes or contemplates additional indemnification by agreement, or the corresponding provisions of any amendment to or replacement of the OGCA or such provision thereof; and

ii. to the fullest extent authorized or permitted by any amendments to or replacements of the OGCA adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its directors, officers, employees and agents.

Section 8. Exclusions. Notwithstanding any provision in this Agreement to the contrary, the Corporation shall not be obligated under this Agreement:

(a) to make any indemnity for amounts otherwise indemnifiable hereunder (or for which advancement is provided hereunder) if and to the extent that Indemnitee has otherwise actually received such amounts under any insurance policy, contract, agreement or otherwise;

(b) to make any indemnity for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Corporation within the meaning of Section 16(b) of the Securities Exchange Act of 1934, as amended, or similar provisions of state statutory law or common law; or

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(c) to make any indemnity or advancement that is prohibited by applicable law; or

(d) for claims initiated or brought by Indemnitee against the Corporation or its directors, officers, employees or other indemnitees, except:

i. with respect to actions or proceedings brought to establish or enforce a right to receive Expenses or indemnification under this Agreement or any other agreement or insurance policy or under the Bylaws now or hereafter in effect relating to indemnification;

ii. if the Board approves, at any time, the initiation or bringing of such claim;

iii. such payment arises in connection with any mandatory counterclaim or cross-claim or affirmative defense brought or raised by Indemnitee in any Proceeding (or any part of any Proceeding); or

iv. as otherwise required under applicable law.

Section 9. Advance of Expenses. Notwithstanding any provision of this Agreement to the contrary, the Corporation shall advance, to the extent not prohibited by law, all Expenses incurred by or on behalf of Indemnitee (or which Indemnitee determines are reasonably likely to be paid or incurred by Indemnitee within three (3) months) in connection with any Proceeding, and such advancement shall be made within twenty (20) days after the receipt by the Corporation of a statement or statements requesting such advances (which shall include invoices received by Indemnitee in connection with such Expenses, if applicable, but, in the case of invoices in connection with legal services, any references to legal work performed or to expenditures made that would cause Indemnitee to waive any privilege accorded by applicable law shall not be included with the invoice) from time to time, whether prior to or after final disposition of any Proceeding. Advances shall be unsecured and interest free. Advances shall be made without regard to Indemnitee’s ability to repay the expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement. The Indemnitee shall qualify for advances upon the execution and delivery to the Corporation of this Agreement, which shall constitute an undertaking providing that the Indemnitee undertakes to the fullest extent required by law to repay the amounts advanced (without interest) if and to the extent that it is ultimately determined by a court of competent jurisdiction in a final judgment, not subject to appeal, that Indemnitee is not entitled to be indemnified by the Corporation. No other form of undertaking shall be required other than the execution of this Agreement. The right to advances under this paragraph shall in all events continue until final disposition of any Proceeding. Nothing in this Section 9 shall limit Indemnitee’s right to advancement pursuant to Section 13(e) of this Agreement. The parties agree that for the purposes of any advancement of Expenses for which Indemnitee has made written demand to the Corporation in accordance with this Agreement, all Expenses included in such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable shall be presumed conclusively to be reasonable.

Section 10. Procedure for Notification and Defense of Claim.

(a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Corporation a written request therefor, and, if Indemnitee so chooses pursuant to Section 11

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of this Agreement, such written request shall also include a request for Indemnitee to have the right to indemnification determined by Independent Counsel. The omission by Indemnitee to notify the Corporation hereunder will not relieve the Corporation from any liability which it may have to Indemnitee hereunder, under the Bylaws, any resolution of the Board providing for indemnification or otherwise, and any delay in so notifying the Corporation shall not constitute a waiver by Indemnitee of any rights under this Agreement. The Secretary of the Corporation shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification.

(b) The Corporation will be entitled to participate in any Proceeding at its own expense.

Section 11. Procedure Upon Application for Indemnification.

(a) Upon written request by Indemnitee for indemnification pursuant to Section 10(a), if so requested by Indemnitee pursuant to Section 10(a), a determination with respect to Indemnitee’s entitlement to indemnification shall be made by Independent Counsel and such Independent Counsel shall be selected as set forth in Section 11(b). If Indemnitee does not request a determination by Independent Counsel in a written request for indemnification pursuant to Section 10(a), a determination, if such determination is required, with respect to Indemnitee’s entitlement thereto shall be made in the specific case, which shall be at the election of the Board: (1) by a majority vote of the disinterested directors, even though less than a quorum, (2) by a committee of disinterested directors designated by a majority vote of the disinterested directors, even though less than a quorum, (3) if there are no disinterested directors, or if the Board so directs, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to the Indemnitee, or (4) by the stockholders of the Corporation holding a majority of the outstanding voting stock of the Corporation. For purposes hereof, disinterested directors are those members of the Board who are not parties to the Proceeding in respect of which indemnification is sought by Indemnitee. In the case that such determination is made by Independent Counsel, a copy of Independent Counsel’s written opinion shall be delivered to Indemnitee and, if it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days after such determination. Indemnitee shall cooperate with the Independent Counsel, or the Corporation, as applicable, making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such counsel or the Corporation upon reasonable advance request any reasonable documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any costs or expenses (including attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating with the Independent Counsel or the Corporation shall be borne by the Corporation (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Corporation hereby indemnifies and agrees to hold Indemnitee harmless therefrom.

(b) In the event that Indemnitee exercises his right to have his entitlement to indemnification determined by Independent Counsel pursuant to Section 10(a), the Independent Counsel shall be selected by Indemnitee, and Indemnitee shall give written notice to the Corporation advising it of the identity of the Independent Counsel so selected. The Corporation may, within ten (10) days after such written notice of Indemnitee’s selection shall have been

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given, deliver to the Indemnitee a written objection (an “Objection Notice”) to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 1 of this Agreement, and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person or firm so selected shall act as Independent Counsel. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If the Independent Counsel selected by the Indemnitee cannot serve as Independent Counsel for any reason, the Indemnitee shall have the right, by written notice to the Corporation, to select another person or firm to act as Independent Counsel. The Corporation shall have the right, within ten (10) days after such written notice, to deliver to Indemnitee an Objection Notice, and absent a proper and timely objection, the person or firm so selected by the Indemnitee shall act as Independent Counsel. If, within twenty (20) days after submission by Indemnitee of a written notice to the Corporation from the Indemnitee identifying the Independent Counsel selected by the Indemnitee, all objections by the Corporation to the Independent Counsel so selected by the Indemnitee have not been withdrawn, the Indemnitee may petition a court of competent jurisdiction for resolution of any objection which shall have been made by the Corporation to the selection of Independent Counsel and/or for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate. The person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 11(a) hereof. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 13(a) of this Agreement, Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

Section 12. Presumptions and Effect of Certain Proceedings.

(a) In making a determination with respect to entitlement to indemnification hereunder, it shall be presumed that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 10(a) of this Agreement, and the Corporation shall have the burden of proof to overcome that presumption in connection with the making of any determination contrary to that presumption. Neither (i) the failure of the Corporation or of Independent Counsel to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor (ii) an actual determination by the Corporation or by Independent Counsel that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.

(b) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of guilty, nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Corporation or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that his conduct was unlawful.

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(c) For purposes of any determination of good faith, Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Corporation or Enterprise, including financial statements, or on information supplied to Indemnitee by the officers of the Corporation or Enterprise in the course of their duties, or on the advice of legal counsel for the Corporation or Enterprise or the Board or counsel selected by any committee of the Board or on information or records given or reports made to the Corporation or Enterprise by an independent certified public accountant or by an appraiser, investment banker or other expert selected with reasonable care by the Corporation or Enterprise or by the Board or any committee of the Board. The provisions of this Section 12(c) shall not be deemed to be exclusive or to limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

(d) The knowledge and/or actions, or failure to act, of any director, consultant, officer, agent or employee of the Corporation or any Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

Section 13. Remedies of Indemnitee.

(a) Subject to Section 13(f), in the event that (i) a determination is made pursuant to Section 11 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 9 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 11(a) of this Agreement within sixty (60) days after receipt by the Corporation of the request for indemnification that does not include a request for Independent Counsel, (iv) payment of indemnification is not made pursuant to Section 4, 5 or 6 or the last sentence of Section 11(a) of this Agreement within ten (10) days after receipt by the Corporation of a written request therefor, (v) payment of indemnification pursuant to Section 2, 3 or 7 of this Agreement is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification, or (vi) in the event that the Corporation or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or Proceeding designed to deny, or to recover from, the Indemnitee the benefits provided or intended to be provided to the Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court of his entitlement to such indemnification and/or advancement. Alternatively, Indemnitee, at his option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence such proceeding seeking an adjudication or an award in arbitration within 180 days following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 13(a); provided, however, that the foregoing time limitation shall not apply in respect of a proceeding brought by Indemnitee to enforce his rights under Section 4 of this Agreement. The Corporation shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

(b) In the event that a determination shall have been made pursuant to Section 11(a) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 13 shall be conducted in all

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respects as a de novo trial, or arbitration, on the merits and Indemnitee shall not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section 13, the Corporation shall have the burden of proving Indemnitee is not entitled to indemnification or advancement, as the case may be.

(c) If a determination shall have been made pursuant to Section 11(a) of this Agreement that Indemnitee is entitled to indemnification, the Corporation shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 13, absent a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification.

(d) The Corporation shall be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 13 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Corporation is bound by all the provisions of this Agreement. It is the intent of the Corporation that, to the fullest extent permitted by law, the Indemnitee not be required to incur legal fees or other expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to the Indemnitee hereunder.

(e) To the fullest extent permitted by law, the Corporation shall indemnify Indemnitee against any and all Enforcement Expenses and, if requested by Indemnitee, shall (within ten (10) days after receipt by the Corporation of a written request therefor) advance, to the extent not prohibited by law, such Enforcement Expenses to Indemnitee, which are incurred by Indemnitee in connection with any action brought by Indemnitee for indemnification or advancement from the Corporation under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Corporation, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement or insurance recovery, as the case may be, in the suit for which indemnification or advancement is being sought. The parties agree that for the purposes of any advancement of Enforcement Expenses for which Indemnitee has made written demand to the Corporation in accordance with this Agreement, all Enforcement Expenses included in such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable shall be presumed conclusively to be reasonable.

(f) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement of Indemnitee to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding, including any appeal therein.

Section 14. Non-exclusivity; Survival of Rights; Insurance; Subrogation.

(a) The rights of indemnification and to receive advancement as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in

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respect of any action taken or omitted by Indemnitee in his Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in Oklahoma law, whether by statute or judicial decision, permits greater indemnification or advancement than would be afforded currently under the Bylaws, this Agreement or Oklahoma law, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

(b) To the extent that the Corporation maintains an insurance policy or policies providing liability insurance for directors, officers, employees, agents, trustees, consultants or fiduciaries of the Corporation or of any other Enterprise, Indemnitee shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such director, officer, employee, agent, trustee, consultant or fiduciary under such policy or policies. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Corporation has director and officer liability insurance in effect, the Corporation shall give prompt notice of such claim or of the commencement of a proceeding, as the case may be, to the insurers in accordance with the procedures set forth in the respective policies. The Corporation shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

(d) In the event of any payment under this Agreement, the Corporation shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Corporation to bring suit to enforce such rights.

(e) The Corporation’s obligation to provide indemnification or advancement hereunder to Indemnitee who is or was serving at the request of the Corporation as a director, officer, employee, agent, trustee, consultant or fiduciary of any other Enterprise shall be reduced by any amount Indemnitee has actually received as indemnification or advancement from such other Enterprise.

Section 15. Duration of Agreement. This Agreement shall continue until and terminate upon the later of: (a) ten (10) years after the date that Indemnitee shall have ceased to serve as a director, officer, employee or agent of the Corporation or, at the request of the Corporation, a director, officer, employee, agent, trustee, consultant or fiduciary of any Enterprise or (b) one (1) year after the final termination of any Proceeding, including any appeal, then pending in respect of which Indemnitee is granted rights of indemnification or advancement hereunder and of any proceeding, including any appeal, commenced by Indemnitee pursuant to Section 13 of this Agreement relating thereto. This Agreement shall be binding upon the Corporation and its successors and assigns and shall inure to the benefit of Indemnitee and his heirs, executors and administrators. The Corporation shall require and cause any successor, and any direct or indirect parent of any successor, whether direct or indirect by purchase, merger,

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consolidation or otherwise, to all, substantially all or a substantial part, of the business and/or assets of the Corporation, by written agreement in form and substance satisfactory to the Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Corporation would be required to perform if no such succession had taken place.

Section 16. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

Section 17. Enforcement.

(a) The Corporation expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director, officer, employee or agent of the Corporation, and the Corporation acknowledges that Indemnitee is relying upon this Agreement in serving as a director, officer, employee or agent of the Corporation. Subject to Section 15 of this Agreement, this Agreement shall continue in force after Indemnitee has ceased to serve as a director, officer, employee or agent of the Corporation and will continue to provide coverage, to the extent provided for in this Agreement, for matters that occurred while Indemnitee served as a director, officer, employee or agent of the Corporation.

(b) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Bylaws, any resolution of the Board providing for indemnification and applicable law, and shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.

Section 18. Modification and Waiver. No supplement, modification or amendment, or waiver of any provision, of this Agreement shall be binding unless executed in writing by the parties thereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement nor shall any waiver constitute a continuing waiver.

Section 19. Notice by Indemnitee. Indemnitee agrees to promptly notify the Corporation in writing upon being served with any summons, citation, subpoena, complaint,

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indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement as provided hereunder. The failure of Indemnitee to so notify the Corporation shall not relieve the Corporation of any obligation which it may have to the Indemnitee under this Agreement or otherwise.

Section 20. Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed, (c) mailed by reputable overnight courier and receipted for by the party to whom said notice or other communication shall have been directed or (d) sent by facsimile transmission, with receipt of oral or written confirmation that such transmission has been received:

(a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or such other address as Indemnitee shall provide to the Corporation.

(b) If to the Corporation to:

ONE Gas, Inc.

First Place Tower

15 E. Fifth Street

Tulsa, Oklahoma 74103

Attn: General Counsel

Facsimile: (918)                     

or to any other address as may have been furnished to Indemnitee by the Corporation.

Section 21. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Corporation, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any Proceeding, in such proportion as is deemed fair and reasonable in light of all of the circumstances in order to reflect (i) the relative benefits received by the Corporation and Indemnitee in connection with the event(s) and/or transaction(s) giving rise to such Proceeding; and/or (ii) the relative fault of the Corporation (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).

Section 22. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Oklahoma, without regard to its conflict of laws rules. Except with respect to any arbitration commenced by Indemnitee pursuant to Section 13(a) of this Agreement, the Corporation and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Oklahoma Court, and not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit to the exclusive

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jurisdiction of the Oklahoma Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (iii) consent to service of process at such address set forth in Section 20 of this Agreement with the same legal force and validity as if served upon such party personally within the State of Oklahoma, (iv) waive any objection to the laying of venue of any such action or proceeding in the Oklahoma Court, and (v) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Oklahoma Court has been brought in an improper or inconvenient forum.

Section 23. Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

Section 24. Miscellaneous. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

[signature page follows]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.

CORPORATION:
ONE GAS, INC.
By:
	Name:
	Title:
INDEMNITEE:
By:
	Name:
	Address:

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EX-10.6

Exhibit 10.6

ONE GAS, INC.

ANNUAL OFFICER INCENTIVE PLAN

1. Establishment. By unanimous consent, the Board of Directors has approved the adoption of this Plan, effective January 1, 2014. No individual is entitled to participate in both this Plan and the ONEOK, Inc. Annual Officer Incentive Plan at the same time for periods after December 31, 2013. The Plan shall first apply with respect to the fiscal year ending December 31, 2014. The Plan shall remain in effect until terminated by the Board of Directors pursuant to Paragraph 14, below.

2. Purpose. The purpose of this Plan is to provide certain officers of the Company who are eligible for participation in the Plan under Paragraph 4, below, with a direct financial interest in the performance and profitability of the Company, and particular business units thereof, and to reward performance in employment with the Company. It is the intention (but not the obligation) of the Company that payment of Incentive Awards will be made annually in accordance with the terms of this Plan.

3. Definitions. Unless the context clearly indicates otherwise, the following terms, when used in this Plan, shall have the meanings set forth below:

“Board of Directors” shall mean the Board of Directors of ONE Gas, Inc.

“Change in Control” shall mean (i) prior to the effective date of the Separation, the occurrence of a change in control as defined in the ONEOK, Inc. Severance Pay Plan and (ii) on and after the effective date of the Separation, the occurrence of a change in control as defined in the ONE Gas, Inc. Severance Pay Plan. For avoidance of doubt, the Separation will not constitute a Change in Control for purposes of the Plan.

“Committee” shall mean the Executive Compensation Committee of the Board of Directors.

“Common Stock” shall mean the common stock, par value $0.01, of ONE Gas, Inc.

“Company” shall mean ONE Gas, Inc., its divisions and subsidiaries, or, any successor thereto by merger, consolidation, liquidation, or other reorganization.

“Disability” shall mean a physical or mental infirmity which impairs the Participant’s ability to perform substantially his or her duties for a period of one-hundred eighty (180) consecutive days.

“Employee” shall mean an active full-time employee of the Company, and shall exclude independent contractors, or leased or temporary employees. Employees included in other annual cash incentive plans (including but not limited to participants in the ONE Gas, Inc. Annual Employee Incentive Plan) shall not be considered as Employees for the purpose of this Plan. Except as otherwise specifically provided in this Plan, separated and retired employees shall not be considered as Employees for purposes of this Plan.

“Equity Compensation Plan” shall mean the Company’s equity compensation plan.

“Executive Officer” shall mean an individual elected as an Executive Officer of the Company by the Committee for purposes of determination and payment of incentive compensation awards under the Plan.

“Fiscal Year” shall mean the 12-month period utilized by the Company for financial accounting purposes beginning each January 1 and ending on the next following December 31.

“Incentive Award” shall mean the awards of incentive compensation made to Participants in the Plan pursuant to its terms.

“ONEOK Group” shall mean ONEOK, Inc. and any of its direct or indirect subsidiaries.

“Participant” shall mean an Employee of the Company who is eligible for participation in the Plan under the eligibility provisions of Paragraph 4 of this Plan.

“Plan” shall mean this ONE Gas, Inc. Annual Officer Incentive Plan set forth herein and as amended from time to time.

“Plan Year” shall mean the Fiscal Year of the Company.

“Retirement” shall mean a voluntary termination of employment of the Participant with the Company by the Participant if at the time of such termination of employment the Participant has completed both five (5) years of service with the Company and attained age fifty (50). For this purpose, “years of service” means the number of full years of service of a Participant, based on such Participant’s period of continuous employment with the Company; provided that a Participant shall receive service credit for continuous service provided to members of the ONEOK Group as if that service had been rendered to the Company if there is no break in service between the Participant’s service with a member of the ONEOK Group and the Participant’s service with the Company.

“Separation” means the separation of the ONEOK, Inc. local natural gas distribution business into an independent, publicly traded entity to be known as ONE Gas, Inc.

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4. Eligible Plan Participants. Participation in the Plan shall include Employees who are Executive Officers of the Company, but shall exclude:

(a) Participants in other designated annual cash incentive plans, which are designated by the Committee and communicated to Employees prior to the Plan Year, or as otherwise determined by the Committee; and

(b) Except as otherwise specifically provided in this Plan, Employees whose employment is terminated before December 31 of the Plan Year.

Except as otherwise provided herein, only Participants who are eligible Employees and Executive Officers on the active payroll of the Company on January 1, and who remain as eligible Employees and Participants throughout the entire Plan Year, shall be entitled to receive an Incentive Award for that Plan Year; provided, however, that an individual who becomes an Employee and Executive Officer after January 1 of the Plan Year may be eligible to participate in the Plan and receive a prorated Incentive Award for that Plan Year, as determined by the Committee.

5. Participant Classifications and Awards. Participants in the Plan shall be eligible to receive Incentive Awards for a Plan Year, but shall not receive incentive awards under the ONE Gas, Inc. Annual Employee Incentive Plan (an “Employee Incentive Award”). Notwithstanding the foregoing, if an individual who is an Employee but not an Executive Officer on January 1 of a Plan Year, and thereafter is elected to be an Executive Officer at a subsequent date during such Plan Year, that individual may be entitled to receive a prorated Incentive Award and a prorated Employee Incentive Award as determined by the Committee, in its sole discretion. In addition, the Committee may, in its sole discretion, change the Incentive Award target for an Executive Officer during the Plan Year if the Executive Officer is promoted, receives a salary increase during the Plan Year or other similar circumstances, and such Executive Officer may be entitled to receive a prorated Incentive Award, as determined by the Committee. The formula for determining the amount of any prorated Incentive Award is as follows:

Step 1: ((original base salary * original target * (number of days in position / 365)) + (year-end base salary * new target * (number of days in new position / 365))) = X

Step 2: Divide X by year-end base salary = Y (the “Prorated Incentive Target”)

Step 3: Multiply Y by the year-end base salary, company, business unit and individual modifiers to determine the actual prorated Incentive Award

6. Administration. The Plan shall be administered by the Committee which shall be composed of at least three members of the Board of Directors. The Committee is hereby vested

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with full powers of administration of the Plan, subject only to the provisions herein set forth. Members of the Committee shall not be eligible to receive Incentive Awards or any other financial benefit under the Plan. The Committee shall act by a vote of a majority of a quorum or by unanimous written consent. A majority of its members shall constitute a quorum. The Board of Directors may, from time to time, remove members from or add members to the Committee. Vacancies on the Committee, arising for any reason, shall be filled only by the Board of Directors. Subject to Section 7, the Committee shall have the authority to define, prescribe, amend and rescind rules, regulations, procedures, terms and conditions relating to the Plan. The Committee shall also have the authority to make all-other determinations necessary or advisable, in its sole discretion, for the administration of the Plan, including but not limited to interpreting the Plan, correcting defects, reconciling inconsistencies and resolving ambiguities and determining all questions that shall arise under the Plan, including questions as to rights of Participants, and all other matters concerning the Plan. The interpretation by the Committee of the terms and provisions of the Plan, and its administration of the Plan, and all actions taken by the Committee, shall be final, binding and conclusive on the Company, its stockholders, subsidiaries, all Participants in the Plan and Employees, and upon their respective successors and assigns, and upon all other persons claiming under or through any of them.

7. Determination of Incentive Awards.

(a) The determination of incentive criteria and actual Incentive Awards for Participants and timing and terms of payment of such Incentive Awards shall be made pursuant to determinations, actions, rules, regulations and procedures adopted and established from time to time by the Committee. The Committee shall identify and designate the individuals eligible to participate in the Plan as an Executive Officer.

(b) It is anticipated, subject in all cases to the determinations to be made by the Committee, in its sole discretion (which may differ in any way the Committee determines from the following), that Incentive Awards will be made payable to Participants, and the Plan will operate, subject to the following conditions:

i. the Committee will establish and approve before the start of a Fiscal Year achievement of certain corporate and unit performance goals and individual performance criteria as benchmarks for Incentive Awards;

ii. the Committee will determine the measurement period for such achievement of such goals and such performance criteria, provided, however that such period will correspond to the Company’s Fiscal Year;

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iii. the Committee will determine the target Incentive Award for each Participant, in its sole discretion, and may, in its sole discretion, change the Incentive Award target for an Executive Officer during the Plan Year as it deems appropriate, in which case the Participant may be entitled to receive a prorated Incentive Award, as determined by the Committee;

iv. The Committee will determine the amount of any Incentive Award, including any pro-rated Incentive Award, that is earned by each Participant and payment of Incentive Awards approved by the Committee under the Plan will be made as soon as reasonably possible after the end of the Fiscal Year for which they are approved after the audited financial results are made available to the Committee;

v. the Committee will be assisted in administering the Plan by the Chief Executive Officer, and the Officers, employees and departments of the Company designated by the Chief Executive Officer;

vi. the Committee will monitor the Plan and make adjustments and interpretations, from time to time as it determines, in its sole discretion to be appropriate;

vii. goals and performance criteria established pursuant to the Plan can be modified by the Committee during the Fiscal Year of the Company for which such goals and criteria were established if conditions outside the control of the Company or unit arise that made such goals and criteria obsolete or unreasonable (including increasing or decreasing the standards involved or replacing them in their entirety); and

viii. periodic and frequent communication will be made by the Committee to Participants in the Plan who are Executive Officers concerning the Plan’s provisions, the goals, standards and criteria established pursuant to the Plan, and the relevant operating and financial information of the Company, its divisions, subsidiaries, and business units thereof.

8. Payment of Incentive Awards. Any Incentive Award to a Participant in the Plan shall be paid to such Participant as soon as is practicable after the Committee has approved the amount for that period. Said payments shall be deemed additional compensation to such Participant, and payroll taxes shall be withheld from said payments in accordance with all applicable federal, state and local laws.

9. Required Repayment Provision. Notwithstanding anything in the Plan to the contrary, all or a portion of the Incentive Award made to Participants under this plan is subject to being called for repayment to the Company or reduced in any situation where the Committee determines that fraud, negligence, or intentional misconduct by the Participant was a contributing factor to the

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Company having to restate all or a portion of its financial statement(s). The Committee may determine whether the Company shall effect any such repayment or reduction: (i) by seeking repayment from the Participant, (ii) by reducing (subject to applicable law and the terms and conditions of the Plan or any other applicable plan, program, or arrangement) the amount that would otherwise be awarded or payable to the Participant under the Incentive Award, the Plan or any other compensatory plan, program, or arrangement maintained by the Company, (iii) by withholding payment of future increases in compensation (including the payment of any discretionary bonus amount) or grants of compensatory awards that would otherwise have been made in accordance with the Company’s otherwise applicable compensation practices, or (iv) by any combination of the foregoing. The determination regarding the Participant’s conduct, and repayment or reduction under this provision shall be within the sole discretion of the Committee and shall be final and binding on the Participant and the Company.

10. Change in Control; Minimum Incentive Awards. Notwithstanding anything to the contrary stated in this Plan, in the event of a Change in Control in any Plan Year, each Participant in the Plan shall be paid an Incentive Award which is not less than the prorated portion of the Incentive Award such Participant would otherwise receive for that Plan Year through the date of such Change in Control; provided however that that the Company will assume that all thresholds and targets as specified in Section 7 for such Plan Year shall have been met; and provided further, that the Incentive Award shall be reduced by any amount otherwise payable by the Company to the Participant under any other plan, agreement or arrangement based on substantially the same performance goals, criteria and/or factors as are applicable under this Plan for that period of time and performance.

11. Nature of Incentive Awards.

(a) Incentive Awards shall be paid only from the general assets of the Company, and no separate fund nor trust of any kind shall be created or held for the benefit of any person under this Plan. No additions to, and no interest or other earnings on the actual Incentive Award amount shall accrue or be payable to any Participant.

(b) Incentive Awards shall be paid in the form of a lump sum cash payment; provided, that the amount of the cash payment determined under this Plan may be reduced by an amount attributable to a grant or award of Common Stock which is made to the Executive Officer for his/her performance under and pursuant to the terms and provisions of the Equity Compensation Plan (“Equity Compensation Plan Stock Award”) as the Committee, in its sole discretion, may determine for any Plan Year. It is intended that no Common Stock shall be issued as a part of any Incentive Award under or pursuant to this Plan, that any such Equity Compensation Plan Stock Award shall be issued exclusively from and under the Equity Compensation Plan, provided, however, that the Committee, in its sole discretion, may take into

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account such an Equity Compensation Plan Stock Award and reduce the cash payment amount of an Incentive Award to paid under this Plan by an amount that it attributable to part or all of the value or amount of such an Equity Compensation Plan Stock Award.

(c) Incentive Awards paid to Participants under this Plan shall constitute additional special incentive compensation to such Participants to the extent provided herein, and are not a part of any Participant’s regular salary. The payment of an Incentive Award to a Participant for any Plan Year shall not constitute or be considered as any increase or change of such Participant’s regular ongoing salary and compensation otherwise payable by the Company for the Plan Year or any subsequent period of employment. The payment of any Incentive Award under this Plan is completely discretionary with the Board of Directors and the Committee, as herein provided, and no person shall have any claim to be granted or to receive any Incentive Award or other amount, benefit or payment, and no Participant or other person shall have authority to assign or transfer any Incentive Award or other rights, benefits or payments hereunder, or to enter into any agreement with any person for the payment of any Incentive Award, or to make any representation or warranty with respect thereto.

12. Terms of Employment. This Plan does not create a contract of employment between the Company and any Participant. This Plan does not limit the right of the Company to assign or reassign a Participant to a different job or position, to change his/her title, authority, duties or rate of compensation, or to discharge or terminate a Participant for any reason, or for no reason.

13. Termination of Employment.

(a) Generally. Except as otherwise provided herein, upon a Participant’s termination of employment with the Company and all the members of the ONE Gas Group, the Participant’s rights, if any, to an Incentive Award hereunder shall terminate. Except as otherwise provided herein, a Participant must be employed on December 31 of a Fiscal Year or the last day of any other applicable measurement period in order to receive an Incentive Award with respect to the Fiscal Year or measurement period, respectively.

(b) Death, Disability or Retirement. In the event the Participant’s employment is terminated due to death, Disability or Retirement, the Participant (or the Participant’s beneficiary) shall be paid an Incentive Award which is not less than the prorated part of the Incentive Award such Participant would otherwise receive for that Plan Year based on the Company’s performance through the date of such termination.

(c) The Separation. For avoidance of doubt, no Participant shall be treated as having terminated employment with the Company for any purpose under the Plan as a result of the Separation. Notwithstanding the foregoing, the Company may terminate a Participant’s employment with the Company in connection with the Separation pursuant to the Company’s authority described in Section 11.

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14. Amendment or Termination. Notwithstanding anything to the contrary expressed or implied herein, the Company may at any time amend, modify, suspend or terminate the Plan by resolution adopted by the Board of Directors. The amendment, modification, suspension or termination of the Plan may be made upon such terms and conditions as the Board of Directors, in its sole discretion, determines to be appropriate, and may involve modification, suspension or termination of any anticipated or possible future Incentive Awards to Participants under the Plan which have not been paid, even if the particular performance goals and criteria for such Incentive Awards or payment thereof have been established for a Plan Year.

15. Applicable Law. This Plan shall be governed by and construed in accordance with the laws of the State of Oklahoma (regardless of the law that must otherwise govern under applicable Oklahoma principles of conflict laws).

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EX-10.7

Exhibit 10.7

ONE GAS, INC.

PRE-2005 NONQUALIFIED

DEFERRED COMPENSATION PLAN

(Effective January 1, 2014)

TABLE OF CONTENTS

		Page
Article I - PURPOSE			1
1.1	Establishment and Purpose		1
Article II - DEFINITIONS			2
2.1	Account		2
2.2	Base Salary		2
2.3	Beneficiary		2
2.4	Board		2
2.5	Bonus		2
2.6	Change in Control		3
2.7	Code		5
2.8	Committee		5
2.9	Compensation		5
2.10	Corporation		5
2.11	Deferral Account		5
2.12	Deferral Benefit		6
2.13	Determination Date		6
2.14	Disability		6
2.15	Employee		6
2.16	Employer		6
2.17	ERISA		6
2.18	Exchange Act		6
2.19	Former ONE Gas Employee		6
2.20	Investment Return Rate		7
2.21	Just Cause		7
2.22	KGS Deferred Compensation Plan		7
2.23	KGS Deferred Benefit Account		7
2.24	Key Employee Incentive Plan		7
2.25	Long-Term Deferral		7
2.26	Lump Sum Merit Award		8
2.27	Matching Account		8
2.28	ONE Gas		8
2.29	ONE Gas NQDC Plan		8
2.30	ONE Gas Employee		8
2.31	ONE Gas Group		8
2.32	ONEOK		8
2.33	ONEOK 2005 NQDC Plan		8
2.34	ONEOK Group		9
2.35	ONEOK Pre-2005 NQDC Plan		9
2.36	Participant		9
2.37	Participation Agreement		9
2.38	Person		9

2.39	Plan	9
2.40	Plan Year	9
2.41	Retirement	9
2.42	Retirement Plan	9
2.43	Separation	10
2.44	Shares	10
2.45	Short-Term Deferral	10
2.46	Subsidiary	10
2.47	Thrift Plan	10
2.48	Transferred Participant	10
2.49	Trust	10
Article III - ELIGIBILITY AND PARTICIPATION		10
3.1	Eligibility	10
3.2	Exclusion from Eligibility	11
3.3	Frozen Plan	11
Article IV - BENEFIT ACCOUNTS		11
4.1	Determination of Account	11
4.2	Crediting of Investment Return; Other Items to Participant Accounts	11
4.3	Investment Return Rate; Designated Deemed Investment	11
4.4	Statement of Accounts	12
4.5	Vesting of Account	12
4.6	Administration and Crediting of KGS Deferred Benefit Accounts	12
Article V - PAYMENT OF BENEFITS		13
5.1	Payment of Long-Term Deferred Benefit; Retirement Eligible Participant	13
5.2	Payment of Short-Term Deferral Benefit	13
5.3	Payment of Deferral Benefit upon Disability or Death	13
5.4	Lump Sum Payment of Deferral Benefit Upon Termination of Employment; Participant Not Eligible for Vested Retirement Plan Benefits	13
5.5	Form of Payment	14
5.6	Commencement of Payments	14
5.7	Additional Amount As To Certain Retirement Plan Participants	14
5.8	Specific Term Deferrals	15
5.9	Payment of KGS Deferred Benefit Accounts	15
5.10	Hardship Payment of Deferrals	15
Article VI - BENEFICIARY DESIGNATION		15
6.1	Beneficiary Designation	15
6.2	Amendments	16
6.3	No Designation	16
6.4	Effect of Payment	16

Article VII - ADMINISTRATION		16
7.1	Plan Committee; Duties	16
7.2	Agents	17
7.3	Binding Effect of Decisions	17
7.4	Indemnity of Committee	17
Article VIII - AMENDMENT AND TERMINATION OF PLAN		17
8.1	Amendment	17
8.2	Termination	18
Article IX - PLAN EFFECT, LIMITATIONS, MISCELLANEOUS PROVISIONS		18
9.1	Nature of Employer Obligation; Funding	18
9.2	Trusts	18
9.3	Nonassignability	19
9.4	Code Section 409A Requirements	19
9.5	Captions	19
9.6	Governing Law	19
9.7	Successors	20
9.8	No Right to Continued Service	20
EXHIBIT A		21
EXHIBIT B		23
EXHIBIT C		25

ONE GAS, INC.

PRE-2005 NONQUALIFIED DEFERRED COMPENSATION PLAN

ARTICLE I - PURPOSE

1.1 Establishment and Purpose

On November 13, 2013, in anticipation of the Separation that is proposed to occur in 2014, the Board of Directors of ONEOK approved the (1) the establishment, effective January 1, 2014, of a deferred compensation plan that is substantially similar to the ONEOK Pre-2005 NQDC Plan for the benefit of ONE Gas Employees and Former ONE Gas Employees; (2) the exclusion of ONE Gas Employees and Former ONE Gas Employees from participating in the ONEOK Pre-2005 NQDC Plan for periods after December 31, 2013; and (3) the transfer of liabilities for ONE Gas Employees and Former ONE Gas Employees who are participants in the ONEOK Pre-2005 NQDC Plan to this Plan effective January 1, 2014. The ONEOK Pre-2005 NQDC Plan was frozen to new deferrals on December 31, 2004.

By unanimous consent, the Board of Directors of ONE Gas approved the adoption of this Plan, effective January 1, 2014, for the benefit of certain ONE Gas Employees and Former ONE Gas Employees who were members of a select group of management or highly compensated employees of any member of the ONEOK Group as of December 31, 2004. The Plan is established to receive liabilities transferred from the ONEOK Pre-2005 NQDC Plan. The purpose of the Plan is to provide the specified benefits to ONE Gas Employees and Former ONE Gas Employees who were participants in the ONEOK Pre-2005 NQDC Plan.

Effective January 1, 2014, all liabilities attributable to ONE Gas Employees and Former ONE Gas Employees under the ONEOK Pre-2005 NQDC Plan are transferred and accepted by this Plan. For periods after December 31, 2013, (1) ONE Gas Employees and Former One Gas Employees shall not be eligible to participate in the ONEOK Pre-2005 NQDC Plan; (2) the ONEOK Pre-2005 NQDC Plan and any successors thereto shall have no further obligation or liability to any ONE Gas Employee or Former ONE Gas Employee with respect to any benefit, amount or right accrued under the ONEOK Pre-2005 NQDC Plan; and (3) this Plan is liable for the payment of any benefits accrued by ONE Gas Employees and Former ONE Gas Employees under the ONEOK Pre-2005 NQDC Plan. No individual is entitled to a benefit under both this Plan and the ONEOK Pre-2005 NQDC Plan.

The terms and conditions of this Plan are substantially the same as the terms and conditions of the ONEOK Pre-2005 NQDC Plan. Exhibit A to the Plan sets forth additional rules applicable Transferred Participants. Notwithstanding anything to the contrary in the Plan, no persons other than Transferred Participants shall be eligible to participate in the Plan.

This Plan is separate from the ONE Gas NQDC Plan, which ONE Gas established to receive liabilities transferred from the ONEOK 2005 NQDC Plan in connection with the Separation.

This Plan and the particular benefits provided to individuals hereunder shall be administered as an unfunded nonqualified deferred compensation and excess benefit plan. The Plan, and benefits

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hereunder, are intended to be excepted from the requirements of Section 409A of the Code as a “grandfathered plan” because the Plan benefits were earned and vested prior to January 1, 2005. Specifically, the ONEOK Pre-2005 NQDC Plan was frozen to new participants and new accruals after December 31, 2004. Accordingly, no additional amounts were deferred by the Transferred Participants under the ONEOK Pre-2005 NQDC Plan after December 31, 2004, and no additional amounts will be deferred under this Plan by any such Transferred Participants.

The Plan is effective January 1, 2014.

The capitalized words and terms in this Plan document shall have the meaning given in the definitions stated in Article II of the Plan, unless otherwise expressly indicated.

ARTICLE II - DEFINITIONS

When used in this Plan and initially capitalized, the following words and phrases shall have the meanings indicated:

2.1 Account

“Account” means the sum of a Participant’s Deferral Account and Matching Account under the Plan.

2.2 Base Salary

“Base Salary” means a Participant’s basic wage or salary paid by an Employer to the Participant without regard to any increases or decreases in such basic wage or salary as a result of (i) an election to defer basic wage or salary under this Plan or (ii) an election between benefits or cash provided under a plan of an Employer maintained pursuant to Sections 125 or 401 (k) of the Code. The Base Salary does not include any Lump Sum Merit Award paid to a Participant, nor any Bonus, as defined in Section 2.5, below.

2.3 Beneficiary

“Beneficiary” means the person or persons designated or deemed to be designated by the Participant pursuant to Article VII to receive benefits payable under the Plan in the event of the Participant’s death.

2.4 Board

“Board” means the Board of Directors of the Corporation.

2.5 Bonus

“Bonus” means the cash bonus paid by the Employer to a Participant under the Key Employee Incentive Plan without regard to any decreases as a result of (i) an election to defer all or any portion of such Bonus under this Plan or (ii) an election between benefits or cash provided under the Thrift Plan or any other plan of the Employer maintained pursuant to Section 401(k) of the Code.

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2.6 Change in Control

A “Change in Control” shall mean the occurrence of any of the following:

(a) An acquisition (other than directly from the Corporation) of any voting securities of the Corporation (the “Voting Securities”) by any “Person” (as the term person is used for purposes of Section 13(d) or 14(d) of the Exchange Act), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Corporation’s then outstanding Voting Securities; provided, however, in determining whether a Change in Control has occurred pursuant to this Section 2.6, Shares or Voting Securities which are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not constitute an acquisition which would cause a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Corporation or (B) any corporation or other Person of which a majority of its voting power or its voting equity securities or equity interest is owned or controlled, directly or indirectly, by the Corporation (for purposes of this definition, a “Related Entity”), (ii) the Corporation or any Related Entity, or (iii) any Person in connection with a “Non-Control Transaction” (as hereinafter defined);

(b) The individuals who, as of January 1, 2014, are members of the Board of Directors (the “Incumbent Board”), cease for any reason to constitute at least a majority of the members of the Board of Directors; or, following a Merger which results in a Parent Corporation, the board of directors of the ultimate Parent Corporation; provided, however, that if the election, or nomination for election by the Corporation’s common stockholders, of any new director was approved by a vote of at least two-thirds of the Incumbent Board, such new director shall, for purposes of this Plan, be considered as a member of the Incumbent Board; provided further, however, that no individual shall be considered a member of the Incumbent Board if such individual initially assumed office as a result of either an actual or threatened “Election Contest” (as described in Rule 14a-I I promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board of Directors (a “Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest; or

(c) The consummation of:

(i) A merger, consolidation or reorganization with or into the Corporation or in which securities of the Corporation are issued (a “Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger where:

(A) the stockholders of the Corporation, immediately before such Merger, own directly or indirectly immediately following such Merger at least fifty percent (50%) of the combined voting power of the outstanding voting securities of (x) the corporation

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resulting from such Merger (the “Surviving Corporation”) if fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Surviving Corporation is not Beneficially Owned, directly or indirectly by another Person (a “Parent Corporation”), or (y) if there is one or more Parent Corporations, the ultimate Parent Corporation;

(B) the individuals who were members of the Incumbent Board immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (x) the Surviving Corporation, if there is no Parent Corporation, or (y) if there is one or more Parent Corporations, the ultimate Parent Corporation; and

(C) no Person other than (1) the Corporation, (2) any Related Entity, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to such Merger was maintained by the Corporation or any Related Entity, or (4) any Person who, immediately prior to such Merger had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Voting Securities or Shares, has Beneficial Ownership of thirty percent (30%) or more of the combined voting power of the outstanding voting securities or common stock of (x) the Surviving Corporation if there is no Parent Corporation, or (y) if there is one or more Parent Corporations, the ultimate Parent Corporation.

(ii) A complete liquidation or dissolution of the Corporation; or

(iii) The sale or other disposition of all or substantially all of the assets of the Corporation to any Person (other than a transfer to a Related Entity or under conditions that would constitute a Non-Control Transaction with the disposition of assets being regarded as a Merger for this purpose or the distribution to the Corporation’s stockholders of the stock of a Related Entity or any other assets).

Notwithstanding the foregoing,

(A) a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities if: (1) such acquisition occurs as a result of the acquisition of Shares or Voting Securities by the Corporation which, by reducing the number of Shares or Voting Securities then outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this subparagraph) as a result of the acquisition of Shares or Voting Securities by the Corporation, and after such share acquisition by the Corporation, the Subject Person becomes the Beneficial Owner of any additional Shares or Voting Securities which increases the percentage of the then outstanding Shares or Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur, or (2) (a) within five business days after a Change in Control would have occurred (but for the operation of this subparagraph), or if the Subject Person acquired Beneficial Ownership of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Corporation’s then outstanding Voting Securities inadvertently, then after the Subject Person discovers or is notified by the Corporation that such acquisition would have triggered a Change in Control (but for the operation of this subparagraph), the Subject Person notifies the Board of

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Directors that it did so inadvertently, and (b) within two business days after such notification, the Subject Person divests itself of a sufficient number of Shares or Voting Securities so that the Subject Person is the Beneficial Owner of less than twenty percent (20%) of the then outstanding Shares or the combined voting power of the Corporation’s then outstanding Voting Securities.

(B) A Change in Control shall not occur upon the Separation.

Notwithstanding anything in this Plan to the contrary, if a Participant’s employment is terminated by the Employer without Just Cause prior to the date of a Change in Control but the Participant reasonably demonstrates that the termination (A) was at the request of a third party who has indicated an intention or taken steps reasonably calculated to effect a Change in Control or (B) otherwise arose in connection with, or in anticipation of a Change in Control which has been threatened or proposed, such termination shall be deemed to have occurred after a Change in Control for purposes of this Plan provided a Change in Control shall actually have occurred.

For purposes of the forgoing definition of Change in Control, “Company” shall mean (i) prior to the effective date of the Separation, ONEOK and (ii) on or after the effective date of the Separation, ONE Gas.

2.7 Code

“Code” means the internal Revenue Code of 1986, and Treasury regulations thereunder, as amended from time to time.

2.8 Committee

“Committee” means the Executive Compensation Committee of the Board of Directors of the Corporation.

2.9 Compensation

“Compensation” means the Base Salary and Bonus payable with respect to an Employee for each calendar year.

2.10 Corporation

“Corporation” means ONE Gas, Inc., its successors and assigns, or any division or Subsidiary thereof.

2.11 Deferral Account

“Deferral Account” means the account maintained on the books of the Employer for the purpose of accounting for the amount of Compensation that each Participant elected to defer under the ONEOK Pre-2005 NQDC Plan and for the amount of investment return credited or debited thereto for each Participant in accordance with Article V.

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2.12 Deferral Benefit

“Deferral Benefit” means the benefit payable to a Participant or his or her Beneficiary pursuant to Article VI.

2.13 Determination Date

“Determination Date” means a date on which the amount of a Participant’s Account is determined and updated as provided in Article V. Each December 31 of a calendar year shall be the Determination Date.

2.14 Disability

“Disability” shall mean a physical or mental condition of a Participant, which the Committee, in its sole discretion, determines on the basis of medical evidence satisfactory to it, prevents the Participant from engaging in further employment by the Employer and that such disability will be permanent and continuous.

2.15 Employee

“Employee” means an employee of the Corporation or a Subsidiary.

2.16 Employer

“Employer” means, with respect to a Participant, the Corporation or the Subsidiary which pays such Participant’s Compensation.

2.17 ERISA

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

2.18 Exchange Act

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

2.19 Former ONE Gas Employee

“Former ONE Gas Employee” means any individual (or any beneficiary, dependent, or alternate payee of such individual, as the context requires) whose employment with any member of the ONEOK Group was terminated prior to January 1, 2014, if such individual was allocated in connection with the Separation to any member of the ONE Gas Group as of January 1, 2014 by ONEOK in its sole discretion.

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2.20 Investment Return Rate

“Investment Return Rate” means the rate of investment return to be credited to a Participant’s Deferral Account and Matching Account pursuant to Section 4.2, which rate shall be specified in Section 4.3 and Exhibit “A” attached hereto.

2.21 Just Cause

“Just Cause” shall mean the Employee’s conviction in a court of law of a felony, or any crime or offense in a court of law of a felony, or any crime or offense involving misuse or misappropriation of money or property, the Employee’s violation of any covenant, agreement or obligation not to disclose confidential information regarding the business of the Corporation (or a division or Subsidiary); any violation by the Employee of any covenant not to compete with the Corporation (or a division or Subsidiary); any act of dishonesty by the Employee which adversely affects the business of the Corporation (or a division or Subsidiary); any willful or intentional act of the Employee which adversely affects the business of, or reflects unfavorably on the reputation of the Corporation (or a division or Subsidiary); the Employee’s use of alcohol or drugs which interferes with the Employee’s performance of duties as an employee of the Corporation (or a division or Subsidiary); or the Employee’s failure or refusal to perform the specific directives of the Corporation’s Board, or its officers which directives are consistence with the scope and nature of the Employee’s duties and responsibilities with the existence and occurrence of all of such causes to be determined by the Corporation in its sole discretion; provided, that nothing contained in the foregoing provisions of this paragraph shall be deemed to interfere in any way with the right of the Corporation (or a division or Subsidiary), which is hereby acknowledged, to terminate the Employee’s employment at any time without cause.

2.22 KGS Deferred Compensation Plan

“KGS Deferred Compensation Plan” means the KGS Deferred Compensation Plan of ONEOK, which was merged into and succeeded by the ONEOK Pre-2005 NQDC Plan effective January 1, 1999.

2.23 KGS Deferred Benefit Account

“KGS Deferred Benefit Account” means a Deferred Benefit Account of a Participant in the KGS Deferred Compensation Plan, which shall be paid and distributed in accordance with Section 5.9.

2.24 Key Employee Incentive Plan

“Key Employee Incentive Plan” means the Key Employee Annual Incentive Plan of the Corporation.

2.25 Long-Term Deferral

“Long-Term Deferral” means a deferral made by a Participant that is not a Short-Term Deferral.

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2.26 Lump Sum Merit Award

“Lump Sum Merit Award” means a Lump Sum Merit Award granted and paid to a Participant pursuant to the merit compensation program of the Corporation and its Subsidiaries.

2.27 Matching Account

“Matching Account” means the account maintained on the books of the Employer for the purpose of accounting for the matching amount credited to the Participant under the ONEOK Pre-2005 NQDC Plan and for the amount of investment return credited thereto for each Participant pursuant to Article V.

2.28 ONE Gas

“ONE Gas” means ONE Gas, Inc., an Oklahoma corporation, or any division or subsidiary thereof.

2.29 ONE Gas NQDC Plan

“One Gas NQDC Plan” means the separate ONE Gas, Inc. Nonqualified Deferred Compensation Plan, which ONE Gas established to receive liabilities transferred from the ONEOK 2005 NQDC Plan in connection with the Separation.

2.30 ONE Gas Employee

“ONE Gas Employee” means an active employee or an employee on vacation or on approved leave of absence (including sick leave, qualified military service under the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended, and leave under the Family Medical Leave Act, as amended), in either case, of any member of the ONE Gas Group on or after January 1, 2014, and shall include any beneficiary, dependent, or alternate payee of such employee, as the context requires.

2.31 ONE Gas Group

“ONE Gas Group” means ONE Gas and each subsidiary of ONE Gas as of January 1, 2014 and any ONE Gas subsidiary that is established or acquired after January 1, 2014.

2.32 ONEOK

“ONEOK” means ONEOK, Inc., an Oklahoma corporation.

2.33 ONEOK 2005 NQDC Plan

“ONEOK 2005 NQDC Plan” means the ONEOK, Inc. 2005 Nonqualified Deferred Compensation Plan.

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2.34 ONEOK Group

“ONEOK Group” means (i) prior to January 1, 2014, ONEOK and any of its direct or indirect subsidiaries, and (ii) on and after January 1, 2014, ONEOK and its subsidiaries as of January 1, 2014 (other than any member of the ONE Gas Group) and any ONEOK subsidiary (other than any member of the ONE Gas Group) that is established or acquired after January 1, 2014.

2.35 ONEOK Pre-2005 NQDC Plan

“ONEOK Pre-2005 NQDC Plan” means the ONEOK, Inc. Employee Nonqualified Deferred Compensation Plan, which was frozen to new deferrals on December 31, 2004.

2.36 Participant

“Participant” means a Transferred Participant.

2.37 Participation Agreement

“Participation Agreement” means a written agreement which was entered into by and between ONEOK and a Participant pursuant to the terms of the ONEOK Pre-2005 NQDC Plan, which shall apply to the same effect under this Plan as if entered into by and between the Corporation and the Participant.

2.38 Person

“Person” means an individual, a trust, estate, partnership, limited liability company, association, corporation or other entity.

2.39 Plan

“Plan” means this ONE Gas, Inc. Pre-2005 Nonqualified Deferred Compensation Plan, as amended from time to time.

2.40 Plan Year

“Plan Year” means a twelve-month period commencing January 1 and ending the following December 31.

2.41 Retirement

“Retirement” means the voluntary termination of employment of a Participant when retirement benefits become payable to the Participant under the Retirement Plan.

2.42 Retirement Plan

“Retirement Plan” means the ONE Gas, Inc. Retirement Plan.

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2.43 Separation

“Separation” means the separation of ONEOK’s local natural gas distribution business into an independent, publicly traded entity to be known as ONE Gas.

2.44 Shares

“Shares” means the common stock, par value $0.01 per share, of the Corporation and any other securities into which such shares are changed or for which such shares are exchanged.

2.45 Short-Term Deferral

“Short-Term Deferral” means a deferral elected by a Participant under which payment of the Deferral Benefit shall commence on a date specified by the Participant, but not less than five (5) years after the Participant’s election thereof; provided, that the Committee, may, in its sole discretion, determine and direct that a shorter period, of not less than one (1) year, be applied to any Short-Term Deferral.

2.46 Subsidiary

“Subsidiary” means any corporation of which the Corporation owns, directly or indirectly, at least a majority of the shares of stock having voting power in the election of directors of such corporation.

2.47 Thrift Plan

“Thrift Plan” means the ONE Gas, Inc. 401(k) Plan.

2.48 Transferred Participant

“Transferred Participant” means a ONE Gas Employee or Former ONE Gas Employee who was a participant in the ONEOK Pre-2005 NQDC Plan immediately before January 1, 2014.

2.49 Trust

“Trust” means a trust created and established pursuant to Section 9.2 of the Plan, or otherwise by the Corporation with respect to the Plan.

ARTICLE III - ELIGIBILITY AND PARTICIPATION

3.1 Eligibility

No person other than a Transferred Participant shall participate in the Plan or be entitled to rights and benefits provided under the terms of the Plan. For avoidance of doubt, no employee of any member of the ONEOK Group shall be eligible to participate in the Plan. Exhibit A to the Plan sets forth the additional rules applicable to the transferred benefits and Transferred Participants.

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3.2 Exclusion from Eligibility

Notwithstanding any other provisions of this Plan to the contrary, if the Committee determines that any Participant may not qualify as a “management or highly compensated employee” within the meaning of ERISA, or regulations thereunder, the Committee may determine, in its sole discretion, that such Participant shall cease to be eligible to participate in this Plan. Upon such determination, the Employer shall make an immediate lump sum payment to the Participant equal to the vested amount credited to the Participant’s Account. Upon such payment, no benefit shall thereafter be payable under this Plan either to the Participant or any Beneficiary of the Participant, and all of the Participant’s elections as to the time and manner of payment of his or her Account will be deemed to be canceled.

3.3 Frozen Plan

The Plan is frozen so that no Employee shall commence participation in the Plan, and no Participant shall defer any Compensation under the Plan, after January 1, 2014.

ARTICLE IV - BENEFIT ACCOUNTS

4.1 Determination of Account

As of each Determination Date, a Participant’s Account shall consist of the balance of the Participant’s Account as of the immediately preceding Determination Date, plus investment return credited as of such Determination Date pursuant to Section 4.2, minus the aggregate amount of distributions, if any, made from such Account since the immediately preceding Determination Date.

4.2 Crediting of Investment Return; Other Items to Participant Accounts

The Deferral Account and Matching Account of each Participant shall be periodically credited and increased, or debited and reduced, as the case may be, by the amount of investment return specified under Section 4.3. The Deferral Account and Matching Account of each Participant shall also be debited and credited for any deemed purchases or sales of, or other deemed transactions involving securities provided for under the Plan. The Deferral Account and Matching Account shall be so credited and debited not less frequently than monthly in the manner established and determined from time to time by the Committee, in its sole discretion. The manner in which the Committee determines that Participant Accounts shall be so debited or credited shall be described in written rules or procedures which shall be stated from time to time by a written description thereof which shall be attached to this Plan as Exhibit “C,” and furnished to the Participants in the Plan.

4.3 Investment Return Rate; Designated Deemed Investment

The Investment Return Rate shall be determined in the manner specified in Exhibit “B” attached hereto.

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To the extent the Investment Return Rate specified in Exhibit “B” attached hereto, applied to a Participant’s deferrals includes a rate that is to be determined from deemed investment of such Participant’s Account in investment options specified therein, the Committee shall prescribe the manner and form in which a Participant may designate the deemed investment of deferrals and other amounts in his or her Account. A Participant will be allowed to change such designation of deemed investment monthly or with such other frequency as specified by the Committee, in its sole discretion. Provided, that notwithstanding anything to the contrary stated or implied by the Plan, including all Exhibits thereto, the use, reference to or consideration of any such deemed investments made by the Committee or Plan, or designated by Participants, the Committee and the Corporation shall not be obligated to make or cause to be made any particular type or form of investment with respect to the funding or payment of the Deferral Benefits or Deferral Accounts of Participants under the Plan, and no Participant shall have the right to direct or in any manner control any actual investments, if any, made by the Employer or any other person for purposes of providing funds for paying liabilities of the Employer for benefits or otherwise under the Plan. No Participant shall have any ownership or beneficial interest in any such actual investments made by the Employer.

4.4 Statement of Accounts

The Committee shall provide to each Participant in the Short-Term Deferral Plan within 120 days after the close of each Plan Year, a statement setting forth the balance of such Participant’s Account as of the Determination Date of the preceding Plan Year and showing all adjustments made thereto during such Plan Year. The Committee shall provide to each Participant in the Long-Term Deferral Plan, not less frequently than quarterly, a statement setting forth the balance of such Participant’s Account as of the last date of the preceding quarter in any Plan Year and showing all adjustments made thereto during such quarter of any Plan Year.

4.5 Vesting of Account

A Participant shall be 100% vested in his or her Deferral Account and Matching Account at all times.

4.6 Administration and Crediting of KGS Deferred Benefit Accounts

Each KGS Deferred Benefit Account of a Participant that was previously maintained and existing under the ONEOK Pre-2005 NQDC Plan shall be maintained and administered in accordance with, and be subject to all the terms and provisions of, this Plan on and after January 1, 2014. Notwithstanding anything to the contrary expressed or implied in the Plan, on and after January 1, 2014, interest shall be credited to each such KGS Deferred Benefit Account for amounts therein which would have constituted a Short-Term Deferral, if such amounts had been deferred under this Plan, at the same rate as the Investment Return Rate specified for a Participant’s Short-Term Deferral under the provisions of paragraph A. of Exhibit B to the Plan; and interest shall be credited to each such KGS Deferred Benefit Account for amounts therein which would have been a Long-Term Deferral, if such amounts had been deferred under this Plan, at the same rate as the Investment Rate specified for a Participant’s Long-Term Deferral under the provisions of paragraph B.1. of Exhibit B to the Plan. Such interest shall be credited to KGS Deferred Benefit Accounts of Participants in accordance with Section 5.2, above.

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ARTICLE V - PAYMENT OF BENEFITS

5.1 Payment of Long-Term Deferred Benefit; Retirement Eligible Participant

Upon the termination of service as an Employee of the Employer by a Participant who is then entitled to commence receiving payment of a fully vested benefit under the Retirement Plan, the Employer shall pay to the Participant a Deferral Benefit in the form of benefit payment specified in the Participant’s written election pursuant to Section 5.5.

5.2 Payment of Short-Term Deferral Benefit

A Short-Term Deferral shall be paid to a Participant beginning on the date specified by the Participant in his or her Participation Agreement, and shall be paid in the form of benefit payment specified in the Participant’s written election pursuant to Section 5.5.

5.3 Payment of Deferral Benefit upon Disability or Death

Upon the Disability of a Participant, the Employer shall pay to the Participant, or the Participant’s personal representative, a Deferral Benefit in annual payments for either five (5) or fifteen (15) years, or in a single lump sum equal to the balance of the Participant’s Account determined pursuant to Article V, less any amounts previously paid and distributed. The Participant with a Disability, or the disabled Participant’s personal representative, shall elect which term of payment is to be paid. Upon the death of a Participant the Participant’s Account shall be paid to the Participant’s Beneficiary. If the Participant has elected Long-Term Deferral the Deferral Benefit shall be paid to the Beneficiary over the time period elected by the Participant commencing as soon as practicable after the time of death of the Participant. If the Participant has elected a Short-Term Deferral the Deferral Benefit shall be paid to the Beneficiary in a single lump sum payment.

5.4 Lump Sum Payment of Deferral Benefit Upon Termination of Employment; Participant Not Eligible for Vested Retirement Plan Benefits

Upon the termination of service of a Participant as an Employee of the Employer prior to the time such Participant is entitled to commence receiving payment of a fully vested benefit under the Retirement Plan, and not by reason of such Participant’s Disability or death, the Employer shall pay to the Participant a Deferral Benefit equal to the balance of the Participant’s vested Account determined pursuant to Article V, less any amounts previously paid and distributed, in a single lump sum. This payment shall be made notwithstanding any other period or time of payment that has been elected by the Participant.

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5.5 Form of Payment

The Deferral Benefit payable to a Participant shall be paid in one of the following forms, as elected by the Participant in his or her Participation Agreement on file as of one (1) year and one (1) day prior to the date of termination:

(a) For Participants who elect a Long-Term Deferral, the Deferral Benefit shall be paid in one of the following elected forms:

(i) In annual payments of the vested Account balance, on and after the payment commencement date over a period of either five (5) or fifteen (15) years (together, in the case of each annual payment, with investment return thereon credited after the payment commencement date pursuant to Section 4.2), with the amount of each such annual payment to be determined by multiplying the remaining principal amount and undistributed income in the Participant’s Account by a fraction, the numerator of which is one (1) and the denominator of which shall be the number of remaining annual payments, including the payment then being calculated; or

(ii) A lump sum.

(b) For Participants who elect a Short-Term Deferral, the Deferral Benefit shall be paid in one of the following elected forms:

(i) Annual payments of a fixed amount which shall amortize the vested Account balance, on and after the payment commencement date over a period of from one (1) to four (4) years (together, in the case of each annual payments with investment return thereon credited after the payment commencement to Section 4.2), with the amount of each such annual payment to be determined by multiplying the remaining principal amount and undistributed income in the Participant’s Account by a fraction, the numerator of which is one (1) and the denominator of which shall be the number of remaining annual payments, including the payment then being calculated; or

(ii) A lump sum.

5.6 Commencement of Payments

The commencement of payments under Sections 5.1 through 5.4, above, shall begin within sixty (60) days following receipt of written notice by the Committee of an event which entitles a Participant (or a Beneficiary) to payments under the Plan.

5.7 Additional Amount As To Certain Retirement Plan Participants

The Corporation shall pay to a Participant or his or her survivor beneficiary, as the case may be, an additional amount equal to the amount by which such Participant’s retirement benefit under the Retirement Plan is reduced by reason of the deferred compensation elected by the Participant under the Plan not being taken into account in the calculation of such Participant’s retirement benefit under the Retirement Plan, but only if such deferred compensation is not taken into account in determining a retirement benefit or payment payable to such Participant under the

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ONE Gas, Inc. Supplemental Executive Retirement Plan (SERP) nor under any other plan, arrangement or agreement of the Corporation other than this Plan. An additional amount payable to a Participant, or his or her beneficiary, under this Section 5.7 shall be paid at the same time and in the same form as such Participant’s retirement benefit is paid under the Retirement Plan.

5.8 Specific Term Deferrals

The Corporation may, from time to time, offer to Participants the opportunity to otherwise defer specific amounts of Base Salary or Bonus for a specific duration and to then be paid out in installments prior to Retirement. These deferrals will be accounted for separately and will be paid out pursuant to an election that applies only to that deferral. The specific terms of each offering will be described in a written memorandum that will be attached to this document. Except where specifically provided otherwise in such memorandum, the terms of such deferrals will adhere to all of the other provisions of the Plan.

5.9 Payment of KGS Deferred Benefit Accounts

The KGS Deferred Benefit Account of any Participant shall be paid and distributed in accordance with the pertinent terms and provisions of the KGS Deferred Compensation Plan governing distribution and payment of Deferred Benefit Accounts to Participants thereunder in effect as of December 31, 1998, and the elections made by a Participant in his or her KGS Deferred Compensation Plan Participation Agreement and Beneficiary Designation, all of which are incorporated herein by reference. Any such Beneficiary Designation for a KGS Deferred Benefit Account may be changed by a Participant to the extent otherwise permissible under the Plan.

5.10 Hardship Payment of Deferrals

In the case of hardship, a Participant may apply in writing to the Corporation, or its designated agent, for the immediate distribution of all or part of his or her Deferral Benefit. Such a hardship distribution, however, will involve a substantial penalty, and each such distribution from the Participant’s Deferral Benefit made under this provision shall be reduced by a penalty equal to six percent (6%) of the total amount of the distribution. The amount of the penalty shall be forfeited by the Participant. The Corporation shall have the sole discretion as to whether such distribution shall be made, and its determination shall be final and conclusive. In making its determinations, the Corporation shall follow a uniform and nondiscriminatory practice.

ARTICLE VI - BENEFICIARY DESIGNATION

6.1 Beneficiary Designation

Each Participant shall have the right, at any time, to designate any person or persons as his or her Beneficiary to whom payment under the Plan shall be made in the event of the Participant’s death prior to complete distribution to the Participant of his or her Account. Any Beneficiary designation shall be made in a written instrument provided by the Committee. All Beneficiary designations must be filed with the Corporation and shall be effective only when received in writing by the Corporation.

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6.2 Amendments

Any Beneficiary designation may be changed by a Participant by the filing of a new Beneficiary designation, which will cancel all the Participant’s prior Beneficiary designations filed with the Committee.

6.3 No Designation

If a Participant fails to designate a Beneficiary as provided above, or if all designated Beneficiaries predecease the Participant, then the Participant’s designated Beneficiary shall be deemed to be the Participant’s estate.

6.4 Effect of Payment

Payment to a Participant’s Beneficiary (or, upon the death of a primary Beneficiary, to the contingent Beneficiary or, if none, to the Participant’s estate) shall completely discharge the Employer’s obligations under the Plan.

ARTICLE VII - ADMINISTRATION

7.1 Plan Committee; Duties

The administrative committee for the Plan shall be those members of the Committee who are not Participants, as long as there are at least three (3) such members. If there are not at least three (3) such non-participating persons on the Committee, the Chief Executive Officer of the Corporation shall appoint other non-participating Directors or Corporation officers to serve on the Committee. The Committee shall supervise the administration and operation of the Plan, may from time to time adopt rules and procedures governing the Plan and shall have authority to give interpretive rulings with respect to the Plan. The Committee shall have such other powers and duties as are specified in this Plan as the same may from time to time be constituted, and not in limitation but in amplification of the foregoing, the Committee shall have power, to the exclusion of all other persons, to interpret the provisions of this instrument, to decide any disputes which may arise hereunder; to construe and determine the effect of Participant Agreements, elections, beneficiary designations, and other actions and documents; to determine all questions that shall arise under the Plan, including questions as to the rights of Participants, and including questions submitted by the trustee of a Trust created under Section 9.2 on all matters necessary for it properly to discharge its duties, powers, and obligations; to employ legal counsel, accountants, consultants and agents; to establish and modify such rules, procedures and regulations for carrying out the provisions of the Plan not inconsistent with the terms and provisions hereof, as the Committee may consider proper and desirable; and in all things and respects whatsoever, without limitation, to direct the administration of the Plan and any such Trust with the trustee being subject to the direction of the Committee. The Committee may supply any omission or reconcile any inconsistency in this instrument in such manner and to such extent as it shall deem expedient to carry the same into effect and it shall be the sole and final judge of such expediency. The Committee may adopt such rules and regulations with respect to the signature by an Employee, Participant and/or Beneficiary as to any agreements, elections or other papers to be

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signed by Employees or Participants or Beneficiaries and similar matters as the Committee shall determine in view of the laws of any state or states. Any act which this instrument authorizes or requires the Committee to do may be done by a majority of the then members of the Committee. The action of such majority of the members expressed either by a vote at a meeting or in writing without a meeting, shall constitute the action of the Committee and shall have the same effect for all purposes as if assented to by all of the members of the Committee at the time in office, provided, however, that the Committee may, in specific instances, authorize one (1) of its members to act for the Committee when and if it is found desirable and convenient to do so.

7.2 Delegation; Agents

The Committee may, at its discretion, delegate discretionary authority for day-to-day administration of the Plan to the Company’s Benefit Plan Administration Committee or its authorized representatives pursuant to a duly adopted resolution or a memorandum of action signed by all members of the Committee or approved via electronic transmission. All actions taken by the Company’s Benefit Plan Administration Committee or its authorized representative shall have the same legal effect and shall be entitled to the same deference as if taken by the Committee itself. In addition, the Committee or its delegate may, from time to time, employ other agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with counsel who may be counsel to the Corporation.

7.3 Binding Effect of Decisions

Any decision or action of the Committee with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan shall be final and binding upon all persons having any interest in the Plan.

7.4 Indemnity of Committee

The Corporation shall indemnify and hold harmless the members of the Committee and their duly appointed agents under Section 7.2 against any and all claims, loss, damage, expense or liability arising from any action or failure to act with respect to the Plan, except in the case of gross negligence or willful misconduct by any such member or agent of the Committee.

ARTICLE VIII - AMENDMENT AND TERMINATION OF PLAN

8.1 Amendment

The Corporation, on behalf of itself and of each Subsidiary may at any time amend, modify, suspend or reinstate any or all of the provisions of the Plan, except that no such amendment, modification, suspension or reinstatement may adversely affect any Participant’s Account, as it existed as of the day before the effective date of such amendment, modification, suspension or reinstatement, without such Participant’s prior written consent. Written notice of any amendment or other action with respect to the Plan shall be given to each Participant.

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8.2 Termination

The Corporation, on behalf of itself and of each Subsidiary, in its sole discretion, may terminate this Plan at any time and for any reason whatsoever. Upon termination of the Plan, the Committee shall take those actions necessary to administer any Participant Accounts existing prior to the effective date of such termination; provided, however, that a termination of the Plan shall not adversely affect the value of a Participant’s Account, the crediting of investment return under Section 4.2, or the timing or method of distribution of a Participant’s Account, without the Participant’s prior written consent. Notwithstanding the foregoing, a termination of the Plan shall not give rise to accelerated or automatic vesting of any Participant’s Matching Account.

ARTICLE IX - PLAN EFFECT, LIMITATIONS, MISCELLANEOUS PROVISIONS

9.1 Nature of Employer Obligation; Funding

Participants, their Beneficiaries, and their heirs, successors and assigns, shall have no secured interest or claim in any property or assets of the Employer. The Employer’s obligation under the Plan shall be merely that of an unfunded and unsecured promise of the Employer to pay money in the future.

9.2 Trusts

Notwithstanding the foregoing, in the event of a Change in Control, the Corporation shall create an irrevocable Trust, or before such time the Corporation may create an irrevocable or revocable Trust, to hold funds to be used in payment of the obligations of Employers under the Plan. In the event of a Change in Control or prior thereto, the Employers shall fund such Trust in an amount equal to not less than the total value of the Participants’ Accounts under the Plan as of the Determination Date immediately preceding the Change in Control, provided that any funds contained therein shall remain liable for the claims of the general creditors of the respective Employers. Pursuant to this Section 9.2 the Corporation may, without further reference to or action by any Employee, Participant, or any Beneficiary from time to time enter into such further agreements with a trustee or other parties, and make such amendments to said trust agreement or such further agreements, as the Corporation may deem necessary or desirable to carry out the Plan; from time to time designate successor trustees of such a Trust; and from time to time take such other steps and execute such other instruments as the Corporation may deem necessary or desirable to carry the out the Plan. The Committee shall advise the trustee of any such Trust in writing with respect to all Deferral Benefits which become payable under the terms of the Plan and shall direct the trustee to pay such Deferral Benefits from the respective Participants’ Accounts, and the Committee shall have authority to otherwise deal with and direct the trustee of such a Trust in matters pertinent to the Plan. It is intended that any Trust created hereunder is to be treated as a “grantor” trust under the Code, and the establishment of such a Trust is not intended to cause a Participant to realize current income on amounts contributed thereto, such a Trust is not intended to cause the Plan to be “funded” under ERISA and the Code, and any such Trust shall be so interpreted.

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9.3 Nonassignability

No right or interest under the Plan of a Participant or his or her Beneficiary (or any person claiming through or under any of them), shall be assignable or transferable in any manner or be subject to alienation, anticipation, sale, pledge, encumbrance or other legal process or in any manner be liable for or subject to the debts or liabilities of any such Participant or Beneficiary. If any Participant or Beneficiary shall attempt to or shall transfer, assign, alienate, anticipate, sell, pledge or otherwise encumber his or her benefits hereunder or any part thereof, or if by reason of his or her bankruptcy or other event happening at any time such benefits would devolve upon anyone else or would not be enjoyed by him or her, then the Committee, in its discretion, may terminate such Participant’s or Beneficiary’s interest in any such benefit (including the Deferral Account) to the extent the Committee considers necessary or advisable to prevent or limit the effects of such occurrence. Termination shall be effected by filing a written instrument with the Secretary of the Corporation and making reasonable efforts to deliver a copy to the Participant or Beneficiary whose interest is adversely affected (the “Terminated Participant”).

As long as the Terminated Participant is alive, any benefits affected by the termination shall be retained by the Employer and, in the Committee’s sole and absolute judgment, may be paid to or expended for the benefit of the Terminated Participant, his or her spouse, his or her children or any other person or persons in fact dependent upon him or her in such a manner as the Committee shall deem proper. Upon the death of the Terminated Participant, all benefits withheld from him or her and not paid to others in accordance with the preceding sentence shall be disposed of according to the provisions of the Plan that would apply if he or she died prior to the time that all benefits to which he or she was entitled were paid to him or her.

9.4 Code Section 409A Requirements

The Plan, and benefits hereunder, are intended to be excepted from the requirements of Section 409A of the Code as a “grandfathered plan” within the meaning of Treasury Regulations Section 1.409A-6 because the benefits payable under the Plan are limited to those benefits that were deferred and vested prior to January 1, 2005, and earnings thereon.

9.5 Captions

The captions contained herein are for convenience only and shall not control or affect the meaning or construction hereof.

9.6 Governing Law

The provisions of the Plan shall be construed and interpreted according to the laws of the State of Oklahoma.

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9.7 Successors

The provisions of the Plan shall bind and inure to the benefit of the Corporation, its Subsidiaries, and their respective successors and assigns. The term “successors” as used herein shall include any corporate or other business entity which shall, whether by merger, consolidation, purchase or otherwise, acquire all or substantially all of the business and assets of the Corporation or a Subsidiary and successors of any such corporation or other business entity.

9.8 No Right to Continued Service

Nothing contained herein shall be construed to confer upon any Participant the right to continue to serve as an Employee of the Employer or in any other capacity.

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EX-10.8

Exhibit 10.8

ONE GAS, INC.

NONQUALIFIED

DEFERRED COMPENSATION PLAN

Effective January 1, 2014

1

ONE GAS, INC.

NONQUALIFIED DEFERRED COMPENSATION PLAN

Effective January 1, 2014

Table of Contents

		Page
Article I. INTRODUCTION			1
1.1	Establishment		1
1.2	Purpose		1
1.3	Effective Date		2
1.4	Grandfathered Plan		2
Article II. DEFINITIONS			2
2.1	Definitions		2
Article III. ELIGIBILITY AND PARTICIPATION			14
3.1	Eligibility		14
3.2	Participation		14
3.3	Elections to Participate Irrevocable		15
3.4	Exclusion from Eligibility		15
Article IV. DEFERRAL OF COMPENSATION AND EXCESS AMOUNTS			15
4.1	Amount and Time of Election to Defer		15
4.2	Deferral Periods; Payment		17
4.3	Committee Authority; Deferral of Compensation		18
4.4	General Requirements for All Elections		18
4.5	Subsequent Elections		19
4.6	Crediting Deferred Base Salary and Bonus		20
4.7	Crediting of Plan Excess Amounts		20
4.8	FICA and Other Taxes		20
Article V. PLAN EXCESS AMOUNTS			20
5.1	General		20
5.2	Thrift Plan Excess Employee Amount		21
5.3	Thrift Plan Excess Matching Amount		21
5.4	Profit Sharing Plan Excess Amount		22
5.5	Retirement Plan Covered Compensation Excess Amount		22
5.6	Supplemental Credit Amount		22
5.7	Required Elections to Defer Excess Amounts		23
Article VI. BENEFIT ACCOUNTS			23
6.1	Determination of Account		23
6.2	Crediting of Investment Return; Other Items to Participant Accounts		23
6.3	Investment Return; Designated Deemed Investment		23
6.4	Statement of Account		24
6.5	Vesting of Participant Accounts		24

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Article VII. PAYMENT OF BENEFITS		24
7.1	Requirements for Distributions and Payments	24
7.2	Payment of Plan Benefit; Long-Term Deferrals	25
7.3	Payment of Plan Benefit; Short-Term Deferrals	25
7.4	Specified Employee Six (6) Month Required Delay in Distribution and Payment	26
7.5	Form of Distribution and Payment	26
7.6	Distribution and Payment for Subsequent Elections	27
7.7	Distribution and Payment for Early Separation from Service	27
7.8	Distribution and Payment of Plan Benefit Upon Disability	27
7.9	Distribution and Payment of Plan Benefit Upon Death	28
7.10	Payment of Deferrals for Unforeseeable Emergency	28
7.11	Commencement of Distributions and Payments	29
7.12	No Acceleration of Distribution and Payment	30
7.13	Retirement Plan Excess Amount	30
Article VIII. BENEFICIARY DESIGNATION		31
8.1	Beneficiary Designation	31
8.2	Amendments	31
8.3	No Designation	31
8.4	Effect of Payment	31
Article IX. ADMINISTRATION		31
9.1	Plan Committee; Authority and Duties	31
9.2	Delegation; Agents	33
9.3	Binding Effect of Decisions	33
9.4	Indemnity of Committee	33
Article X. AMENDMENT AND TERMINATION OF PLAN		34
10.1	Amendment	34
10.2	Termination	34
Article XI. PLAN EFFECT, LIMITATIONS, MISCELLANEOUS PROVISIONS		35
11.1	Nature of Employer Obligation; Funding	35
11.2	Trusts; Transfers of Assets, Property	35
11.3	Nonassignability	36
11.4	Captions	37
11.5	Code Section 409A	37
11.6	Governing Law	37
11.7	Successors	37
11.8	No Right to Continued Service	37
EXHIBIT A		38
EXHIBIT B		40
EXHIBIT C		41
EXHIBIT D		42
EXHIBIT E		44

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ONE GAS, INC.

NONQUALIFIED DEFERRED COMPENSATION PLAN

Effective January 1, 2014

ARTICLE I.

INTRODUCTION

1.1 Establishment

On November 13, 2013, in anticipation of the Separation that is proposed to occur in 2014, the Board of Directors of ONEOK approved the (1) the establishment, effective January 1, 2014, of a deferred compensation plan that is substantially similar to the ONEOK 2005 NQDC Plan for the benefit of ONE Gas Employees and Former ONE Gas Employees; (2) the exclusion of ONE Gas Employees and Former ONE Gas Employees from participating in the ONEOK 2005 NQDC Plan for periods after December 31, 2013; and (3) the transfer of liabilities for ONE Gas Employees and Former ONE Gas Employees who are participants in the ONEOK 2005 NQDC Plan to this Plan effective January 1, 2014.

By unanimous consent, the Board of Directors of ONE Gas approved the adoption of this Plan, effective January 1, 2014, for the benefit of ONE Gas Employees and Former ONE Gas Employees. Effective January 1, 2014, all liabilities attributable to ONE Gas Employees and Former ONE Gas Employees under the ONEOK 2005 NQDC Plan are transferred and accepted by this Plan. For periods after December 31, 2013, (1) ONE Gas Employees and Former One Gas Employees shall not be eligible to participate in the ONEOK 2005 NQDC Plan; (2) the ONEOK 2005 NQDC Plan and any successors thereto shall have no further obligation or liability to any ONE Gas Employee or Former ONE Gas Employee with respect to any benefit, amount or right accrued under the ONEOK 2005 NQDC Plan; and (3) this Plan is liable for the payment of any benefits accrued by ONE Gas Employees and Former ONE Gas Employees under the ONEOK 2005 NQDC Plan. No individual is entitled to a benefit under both this Plan and the ONEOK 2005 NQDC Plan.

The terms and conditions of this Plan are substantially the same as the terms and conditions of the ONEOK 2005 NQDC Plan. Exhibit A to the Plan sets forth additional rules applicable to Transferred Participants.

1.2 Purpose

This Plan and related agreements between the Employer and certain management or highly compensated employees is an unfunded, nonqualified deferred compensation plan and arrangement.

The purpose of the Plan is to provide a select group of management and highly compensated employees of the Employer with the option to defer the receipt of portions of their compensation payable for services rendered to the Employer, and provide nonqualified deferred compensation benefits which are not available to such employees by reason of limitations on employer and employee contributions to qualified pension or profit-sharing plans under the federal tax laws.

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It is intended that the Plan will assist in attracting and retaining qualified individuals to serve as officers and managers of the Employer; and the Plan is intended to constitute a plan which is unfunded and maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees within the meaning of, and as described in Section 201(2) and related provisions of ERISA.

The Plan is intended to meet all requirements of Code section 409A for compensation deferred under the Plan to not be includible in gross income of the Participant until actually paid or distributed pursuant to the Plan. Nothing herein shall be construed as a guarantee of any particular tax treatment to a Participant.

All provisions of the Plan shall be interpreted and administered to the extent possible in a manner consistent with the stated intentions.

1.3 Effective Date

The Plan is effective on January 1, 2014.

1.4 Grandfathered Plan

This Plan is separate from the ONE Gas Pre-2005 NQDC Plan, which ONE Gas established to receive liabilities transferred from the ONEOK Pre-2005 DCP in connection with the Separation.

ARTICLE II.

DEFINITIONS

2.1 Definitions

When used in this Plan and initially capitalized, the following words and phrases shall have the meanings indicated:

Account

“Account” means an account established and maintained for a Participant pursuant to this Plan, to which there shall be credited with and include all amounts of Deferred Compensation that is deferred by and for the Participant under the Plan, which may be accounted for as one or more separate items, amounts or subaccounts for the compensation that is deferred and credited pursuant to the Plan, and investment return thereon, to as determined and prescribed by the Committee.

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Base Salary

“Base Salary” means a Participant’s basic wage or salary paid by the Employer to the Participant without regard to any increases or decreases in such basic wage or salary as a result of (i) an Election to defer basic wage or salary under this Plan or (ii) an Election between benefits or cash provided under a plan of the Employer maintained pursuant to Sections 125 or 401(k) of the Code, and as limited in Exhibit C attached hereto. The Base Salary does not include any Lump Sum Merit Award paid to a Participant, nor any Bonus, as defined below.

Beneficiary

“Beneficiary” means the person or persons designated or deemed to be designated by the Participant pursuant to Article VIII to receive benefits payable under the Plan in the event of the Participant’s death.

Board

“Board” means the Board of Directors of the Corporation.

Bonus

“Bonus” means the cash bonus paid or payable by the Employer to a Participant under an Incentive Plan without regard to any decreases as a result of (i) an Election to defer all or any portion of such Bonus under this Plan or (ii) an Election between benefits or cash provided under the Thrift Plan or any other plan of the Employer maintained pursuant to Section 401(k) of the Code.

Change in Ownership or Control

“Change in Ownership or Control” means (i) prior to the effective date of the Separation, a change in the ownership or effective control of ONEOK or in the ownership of a substantial portion of ONEOK’s assets within the meaning of Code Section 409A; and (ii) on or after the effective date of the Separation, a change in the ownership or effective control of ONE Gas or in the ownership of a substantial portion of ONE Gas’s assets within the meaning of Code Section 409A. For avoidance of doubt, the Separation will not constitute a Change in Ownership or Control for purposes of the Plan.

Code

“Code” means the Internal Revenue Code of 1986, and Treasury regulations thereunder, as amended from time to time.

Committee

“Committee” means the Executive Compensation Committee of the Board of Directors of the Corporation.

Compensation

“Compensation” means the Base Salary and Bonus payable with respect to an Eligible Employee for each calendar year.

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Corporation

“Corporation” means ONE Gas, Inc., its successors and assigns, or any division or Subsidiary thereof.

Deferred Compensation

“Deferred Compensation” means the Base Salary and Bonus deferred by a Participant under the Plan, and Qualified Employer Plan Excess Amounts and Supplemental Credit Amounts that are accrued, deferred and credited by the Corporation for a Participant under the Plan, that are made payable to a Participant in a later taxable year of the Participant pursuant to this Plan.

Determination Date

“Determination Date” means a date on which the amount of a Participant’s Account is determined and updated as provided in Article VI. Each December 31 of a calendar year shall be the Determination Date.

Disabled

“Disabled” or “Disability” means that a Participant is unable to engage in substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident or health plan covering Employees of the Corporation. A Participant will be deemed to be Disabled if such Participant is determined to be totally disabled by the Social Security Administration.

Early Separation from Service

“Early Separation from Service” means a Participant’s Separation from Service prior to attaining age fifty (50) and completing five (5) years of service with the Corporation that is not by reason of death or Disability.

Early Separation from Service Form of Payment

“Early Separation from Service Form of Payment” shall mean the form of payment and distribution of a Participant’s Plan Benefit in the event of his/her Early Separation from Service which shall be a single lump sum payment at his/her Early Separation from Service Specified Time of Distribution.

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Early Separation from Service Specified Time of Distribution

“Early Separation from Service Specified Time of Distribution” means a time of distribution and payment of the Participant’s Plan Benefit which is the date of his/her Early Separation from Service.

Election

“Election” means, as the context requires, (i) the Participant’s election to defer Base Salary, Bonus, and/or Qualified Employer Plan Excess Amounts earned with respect to services performed during a Plan Year, (ii) the Corporation’s election to credit the Participant’s Account with Supplemental Credit Amounts and/or a Retirement Plan Excess Amount, and/or (iii) the Participant’s distribution elections.

Eligible Employee

“Eligible Employee” means a highly compensated or management employee of the Corporation and any member of the ONE Gas Group who is designated by the Committee, by individual name, or group or description, in accordance with Section 3.1, as eligible to participate in the Plan. For avoidance of doubt, no employees of any member of the ONEOK Group are eligible to participate in the Plan.

Employee

“Employee” means an employee of the Corporation or a Subsidiary.

Employer

“Employer” means, with respect to a Participant, the Corporation or the Subsidiary which pays such Participant’s Compensation.

ERISA

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

Exchange Act

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

Fiscal Year

“Fiscal Year” means the fiscal year of the Corporation commencing January 1 and ending the following December 31.

5

Fixed Schedule

“Fixed Schedule” means the distribution or payment of Deferred Compensation deferred under the Plan in a fixed schedule of distributions or payments that are determined and fixed at the time the deferral of such compensation is first elected by the Participant or Corporation under the Plan.

Former ONE Gas Employee

“Former ONE Gas Employee” means any individual (or any beneficiary, dependent, or alternate payee of such individual, as the context requires) whose employment with any member of the ONEOK Group was terminated prior to January 1, 2014, if such individual was allocated in connection with the Separation to any member of the ONE Gas Group as of January 1, 2014 by ONEOK in its sole discretion.

Incentive Plan

“Incentive Plan” means the Annual Officer Incentive Plan or Annual Employee Incentive Plan of the Corporation, as applicable to a Participant under the terms and provisions thereof.

Investment Return

“Investment Return” means the rate of investment return to be credited to a Participant’s Account pursuant to Section 6.2, which rate shall be determined in accordance with Section 6.3 and Exhibit “D” attached hereto; provided, that no Investment Return shall be credited with respect to the Retirement Plan Excess Amount.

Long-Term Deferral

“Long-Term Deferral” means a deferral Election that is not a Short-Term Deferral and under which distribution and payment of the Deferred Compensation and the Plan Benefit shall be distributed and paid at a Specified Time that shall be the Normal Specified Time of Distribution of the Participant. If a Subsequent Election is made, the Plan Benefit deferred by a Long-Term Deferral in the Election shall then be distributed and paid at the Subsequent Election Specified Time of Distribution elected in the Subsequent Election.

Lump Sum Merit Award

“Lump Sum Merit Award” means a Lump Sum Merit Award granted and paid to a Participant pursuant to the merit compensation program of the Corporation and its Subsidiaries.

6

Normal Specified Time of Distribution

“Normal Specified Time of Distribution” means a specified time that must be expressly designated as the Specified Time of Distribution of the compensation deferred by a Participant in and for each Long-Term Deferral Election, which Normal Specified Time of Distribution shall be the first date on which the Participant has (i) attained the age of fifty (50) years, (ii) completed five (5) years of service with the Corporation, and (iii) had a Separation from Service.

ONE Gas

“ONE Gas” shall mean ONE Gas, Inc., an Oklahoma corporation, or any division or subsidiary thereof.

ONE Gas Employee

“ONE Gas Employee” means an active employee or an employee on vacation or on approved leave of absence (including sick leave, qualified military service under the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended, and leave under the Family Medical Leave Act, as amended), in either case, of any member of the ONE Gas Group on or after January 1, 2014, and shall include any beneficiary, dependent, or alternate payee of such employee, as the context requires.

ONE Gas Group

“ONE Gas Group” means ONE Gas and each subsidiary of ONE Gas as of January 1, 2014 and any ONE Gas subsidiary that is established or acquired after January 1, 2014.

ONE Gas Pre-2005 NQDC Plan

“One Gas Pre-2005 NQDC Plan” shall mean the separate ONE Gas, Inc. Pre-2005 Nonqualified Deferred Compensation Plan, which ONE Gas established to receive liabilities transferred from the ONEOK Pre-2005 NQDC Plan in connection with the Separation.

ONEOK

“ONEOK” means ONEOK, Inc., an Oklahoma corporation.

ONEOK 2005 NQDC Plan

“ONEOK 2005 NQDC Plan” shall mean the ONEOK, Inc. 2005 Nonqualified Deferred Compensation Plan.

ONEOK Group

“ONEOK Group” means (i) prior to January 1, 2014, ONEOK and any of its direct or indirect subsidiaries, and (ii) on and after January 1, 2014, ONEOK and its subsidiaries as of January 1, 2014 (other than any member of the ONE Gas Group) and any ONEOK subsidiary (other than any member of the ONE Gas Group) that is established or acquired after January 1, 2014.

7

ONEOK Pre-2005 NQDC Plan

“ONEOK Pre-2005 NQDC Plan” shall mean the ONEOK, Inc. Employee Nonqualified Deferred Compensation Plan, which was frozen to new deferrals effective December 31, 2004.

Participant

“Participant” means a Transferred Participant or any Eligible Employee who elects to participate by filing a Participation Agreement as provided in Section 3.2.

Participation Agreement

“Participation Agreement” means the agreement filed by a Participant, in the form prescribed by the Committee, pursuant to Section 3.2.

Person

“Person” means an individual, a trust, estate, partnership, limited liability company, association, corporation or other entity.

Performance-Based Compensation

“Performance-Based Compensation” means compensation, including Bonus (as hereinabove defined), that is conditioned upon or subject to meeting certain requirements similar to those under Code Section 162(m), as more particularly provided for in Treasury Regulations issued under Code Section 409A.

Plan

“Plan” means this ONE Gas, Inc. Nonqualified Deferred Compensation Plan, as amended from time to time.

Plan Benefit

“Plan Benefit” means the deferred benefit payable to a Participant or a Participant’s Beneficiary pursuant to Article VII and otherwise under the Plan.

Plan Year

“Plan Year” means a twelve-month period commencing January 1 and ending the following December 31.

8

Profit Sharing Plan

“Profit Sharing Plan” means the ONE Gas, Inc. Profit Sharing Plan.

Profit Sharing Plan Excess Amount

“Profit Sharing Plan Excess Amount” means an amount equal to the Participant’s Compensation for the Plan Year that is used for calculating Company Contributions to the Profit Sharing Plan multiplied by the applicable percentage for determining the Company Contributions under the Profit Sharing Plan for the Plan Year, minus the amount of Profit Sharing Plan Company Contributions that are allocated to the Participant’s Account for that Plan Year; it being intended that a Participant shall have credited with a Profit Sharing Plan Excess Amount that is equivalent to the amount of Company Contributions which could not be allocated to the Participant’s Profit Sharing Plan Account for the Plan Year by reason of all limitations on compensation and Company Contributions applicable to Profit Sharing Plan Company Contributions under the Code and Treasury regulations under the Code, including (i) the limitation on annual compensation of an Employee that may be taken into account under Code section 401(a)(17), (ii) the limitation on contributions and other additions under Code section 415(c), and (iii) the exclusion of the amount that a Participant has elected to defer out of his or her Base Salary or Bonus under this Plan from “compensation” as defined in the Profit Sharing Plan and/or used for calculation of Profit Sharing Plan contributions and allocations, which amount is to be credited to a Participant’s Account under Section 5.4 of the Plan.

Qualified Employer Plan Excess Amounts

“Qualified Employer Plan Excess Amounts” means amounts deferred by or for a Participant with respect to participation and/or benefits provided under a qualified defined contribution plan or defined benefit plan established and maintained by the Employer, as more particularly provided for under Article V and otherwise in this Plan.

Retirement Plan

“Retirement Plan” means the ONE Gas, Inc. Retirement Plan.

Retirement Plan Covered Compensation Excess Amount

“Retirement Plan Covered Compensation Excess Amount” means an amount for a Participant who is a participant in the Retirement Plan, and not a participant in the ONE Gas, Inc. Supplemental Executive Retirement Plan nor a participant in the Profit Sharing Plan, that is equal to the Participant’s Compensation for the Plan Year less the limitations on compensation and contributions by the Corporation under the Code and Treasury regulations under the Code, including the limitation on annual compensation of an Employee that may be taken into account under Code section 401(a)(17), multiplied by the applicable percentage for determining the Company Contributions under the Profit Sharing Plan for the Plan Year, which amount is to be credited to be allocated to, or recorded in and accounted for in the Account of a Participant under Section 5.5 of the Plan.

9

Retirement Plan Excess Amount

“Retirement Plan Excess Amount” means the additional amount payable to a Participant who is a participant in the Retirement Plan pursuant to Section 7.13.

Separation

“Separation” means the separation of ONEOK’s local natural gas distribution business into an independent, publicly traded entity to be known as ONE Gas.

Separation from Service

“Separation from Service” means (i) prior to the effective date of the Separation, the termination of a Participant’s employment within the meaning of Treasury Regulations section 1.409A-1(h) with all members of the ONEOK Group and all members of the ONE Gas Group other than by reason of the Participant’s Disability or death; and (ii) on or after the effective date of the Separation, the termination of a Participant’s employment within the meaning of Treasury Regulations section 1.409A-1(h) with the Corporation and all members of the ONE Gas Group other than by reason of the Participant’s Disability or death.

Shares

“Shares” means the common stock, par value $0.01 per share, of the Corporation and any other securities into which such shares are changed or for which such shares are exchanged.

Short-Term Deferral

“Short-Term Deferral” means a deferral elected by a Participant under which payment of the Plan Benefit shall be deferred to commence at a Specified Time of Distribution irrespective of the Participant’s Separation from Service that is specified by the Participant in his or her Election, that shall be not less than five (5) years after the Participant’s Election thereof; provided, that the Committee, may, in its sole discretion, determine and direct that a shorter period, of not less than two (2) years, be applied to any Short-Term Deferral. If a Subsequent Election is made, the Plan Benefit deferred by a Short-Term Deferral in the Election shall then be distributed and paid at the Subsequent Election Specified Time of Distribution elected in the Subsequent Election.

Specified Employee

“Specified Employee” means an Employee who, as of the date of the Employee’s Separation from Service, is a key employee of a Corporation if any stock of the Corporation is then publicly traded on an established securities market or otherwise; and for purposes of this definition, an Employee is a key employee if the Employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with the regulations thereunder and disregarding section 416(i)(5)) at any time during the 12-month period ending on a Specified

10

Employee Identification Date. If an Employee is a key employee as of a Specified Employee Identification Date, the Employee shall be treated as a key employee for purposes of the Plan for the entire 12-month period beginning on the Specified Employee Effective Date. For purposes of identifying a Specified Employee by applying the requirements of section 416(i)(1)(A)(i), (ii), and (iii), the definition of compensation under §1.415(c)-2(a) shall be used, applied as if the Corporation were not using any safe harbor provided in §1.415(c)-2(d), were not using any of the elective special timing rules provided in §1.415(c)-2(e), and were not using any of the elective special rules provided in §1.415(c)-2(g).

Specified Employee Effective Date

“Specified Employee Effective Date” is the first day of the fourth month following the Specified Employee Identification Date.

Specified Employee Identification Date

“Specified Employee Identification Date” means December 31.

Specified Time

“Specified Time” means a date or dates that are not discretionary and objectively determinable at the time an amount of Compensation is deferred and at which objectively determinable deferred amounts are to be payable.

Specified Time of Distribution

“Specified Time of Distribution” means a Specified Time at which Compensation deferred by a Participant’s Election pursuant to the Plan is required to be distributed or paid and which is specified in writing by the Participant in and at the time the deferral of such Compensation is elected by the Election of a Participant.

Subsequent Election

“Subsequent Election” means an irrevocable election made by a Participant with respect to the time of distribution or payment of Deferred Compensation and Plan Benefit under the Plan that is made at any time after Election that is made by the Participant and/or Corporation with respect to such Deferred Compensation.

Subsequent Election Specified Date

“Subsequent Election Specified Date” shall mean a specified fixed date in a calendar year that must be specified in writing by the Participant in a Subsequent Election that is not less than five (5) years from the date payment would otherwise have been made to the Participant under the Plan if such Subsequent Election was not made by the Participant. The written specification of the Subsequent Election Specified Date shall in all cases specify and fix a Specified Time that is not less than five (5) years from the date payment would otherwise have been made to the

11

Participant, it being contemplated and intended that such written specification shall, without limitation, in the case of a Long-Term Deferral (i) meet the requirement in the case of a Participant who has not attained the age of fifty (50) years that the specified Subsequent Election Specified Date be on or after the date the Participant would attain the age of fifty-five (55) years, and (ii) meet the requirement in the case of a Participant who has attained the age of fifty (50) years, that the specified Subsequent Election Specified Date be not less than five (5) years from the date next following the date of the Subsequent Election; and in the case of a Short-Term Deferral meet the requirement that the Subsequent Election Specified Date is not less than five (5) years after the date payment would otherwise have been made to the Participant.

Subsequent Election Specified Time of Distribution

“Subsequent Election Specified Time of Distribution” means:

(a) in the case of a Long-Term Deferral, a Specified Time of Distribution that shall be the first date on or after the Subsequent Election Specified Date for the Long-Term Deferral on which the Participant has (i) attained the age of fifty (50) years, (ii) completed five (5) years of service with the Corporation, and (iii) had a Separation from Service, and

(b) in the case of a Short-Term Deferral, a Specified Time of Distribution that shall be the Subsequent Election Specified Date for the Short-Term Deferral.

Subsidiary

“Subsidiary” means any corporation of which the Corporation owns, directly or indirectly, at least a majority of the shares of stock having voting power in the election of directors of such corporation.

Supplemental Credit Amount

“Supplemental Credit Amount” means a supplemental amount that may be deferred at the election and direction of the Committee under Section 4.3(b).

Taxable Year

“Taxable Year” shall mean the Plan Year commencing January 1 and ending the following December 31.

Thrift Plan

“Thrift Plan” means the ONE Gas, Inc. 401(k) Plan.

Thrift Plan Excess Employee Amount

“Thrift Plan Excess Employee Amount” means an amount equal to the amounts that would have been allocated to the Participant’s Account under the Thrift Plan for the Plan Year by reason of

12

the Participant’s elections under the Thrift Plan, minus the amount that was allocated to the Participant’s account under the Thrift Plan for that Plan Year it being intended that a Participant shall have credited to the Participant’s Account the amount of contributions which could not be allocated to the Participant’s Thrift Plan account for the Plan Year by reason of and after application of the limitations on compensation and contributions or annual additions and otherwise applicable to the Thrift Plan under the Code and Treasury regulations, including (i) Code section 401(a)(17), (ii) Code section 415(c), (iii) the exclusion of the amount the Participant elected to defer out of his or her Compensation under this Plan from “compensation” as defined and/or used for calculation of Thrift Plan contributions or allocations, and other limitations on Thrift Plan employee elective contributions under the Code.

Thrift Plan Excess Matching Amount

“Thrift Plan Excess Matching Amount” means an amount equal to the Participant’s Thrift Plan Matching Contribution Percentage under the Thrift Plan for the Plan Year multiplied by the Participant’s compensation as defined in the Thrift Plan and/or used for calculation of Thrift Plan contributions and allocations in that Plan Year, minus the amount of Thrift Plan matching contributions made by the Corporation that are allocated to the Participant’s Thrift Plan account for that Plan Year; it being intended that a Participant shall have credited to the Participant’s Account the amount of matching contributions which could not be allocated to the Participant’s Thrift Plan account for the Plan Year by reason of and after application of the limitations on compensation and contributions or annual additions and otherwise applicable to the Thrift Plan under the Code and Treasury regulations, including (i) Code section 401(a)(17), (ii) Code section 415(c), (iii) the exclusion of the amount the Participant elected to defer out of his or her Compensation under this Plan from “compensation” as defined and/or used for calculation of Thrift Plan contributions or allocations, and other limitations on Thrift Plan matching contributions under the Code.

Thrift Plan Matching Contribution Percentage

“Thrift Plan Matching Contribution Percentage” means the matching contribution percentage in effect for a specific Plan Year under the Thrift Plan.

Transferred Participant

“Transferred Participant” means a ONE Gas Employee or Former ONE Gas Employee who was a participant in the ONEOK 2005 NQDC Plan immediately before January 1, 2014.

Trust

“Trust” means a trust created and established pursuant to Section 11.2 of the Plan, or otherwise by the Corporation with respect to the Plan.

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Unforeseeable Emergency

“Unforeseeable Emergency” means a severe financial hardship to the Participant resulting from illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code Section 152) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary circumstances arising as a result of events beyond the control of the Participant, including such events and circumstances as are described and considered to be an unforeseeable emergency under Code section 409A and the Treasury regulations thereunder. It is intended and directed with respect to any such unforeseeable emergency that any amounts distributed under the Plan by reason thereof shall not exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship).

ARTICLE III.

ELIGIBILITY AND PARTICIPATION

3.1 Eligibility

Eligibility to participate in the Plan shall be granted to Transferred Participants and those Eligible Employees who are designated by the Committee. Subject to Section 3.4, below (providing for exclusion of Employees not qualifying under certain definitional terms of federal law), the Committee shall adopt a complete written list and/or designation of the Eligible Employees, by individual name or by reference to an identifiable group of persons or by descriptions of the components of compensation of an individual which would qualify the individuals who are eligible to participate, and all of whom shall be a select group of management or highly compensated employees. The written list and/or designation of Eligible Employees by the Committee, from time to time, shall be adopted and maintained in the records of the Committee and Corporation.

3.2 Participation

Participation in the Plan shall be limited to Transferred Participants and Eligible Employees who make an Election to participate in the Plan by timely filing a Participation Agreement with the Committee. An Eligible Employee shall commence participation in the Plan upon the first day of the Plan Year or Fiscal Year as the case may be, designated in his or her Participation Agreement filed with the Committee prior to the beginning of such Plan Year.

The Committee may in its sole discretion, allow in the case of the first Plan Year in which an individual becomes an Eligible Employee to make an initial Election to participate in the Plan and elect a deferral with respect to Compensation or other amounts that become payable under the Plan for services to be performed after the Election; provided, that any Election by such an Eligible Employee shall be made within thirty (30) days after the date he/she becomes eligible to participate in the Plan.

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Participation of Transferred Participants shall be governed by Exhibit A.

3.3 Elections to Participate Irrevocable

A Participant may not change a previously elected percentage of Compensation deferred by an Election, or terminate his or her Election to participate in the Plan and defer Compensation for a Plan Year. Except as may otherwise be determined and approved by the Committee pursuant to the Plan, a Participant’s Election to defer Compensation shall only be effective as of the beginning of the next Plan Year following receipt of the Participant’s Election by the Corporation. Determinations on all Elections and of any effective dates other than as specified above, shall be made by the Committee in accordance with its prevailing administrative procedures.

3.4 Exclusion from Eligibility

Notwithstanding any other provisions of this Plan to the contrary, if the Committee determines that any Participant may not qualify as a “management or highly compensated employee” within the meaning of ERISA, or regulations thereunder, the Committee may determine, in its sole discretion, that such Participant shall cease to be eligible to participate in this Plan.

ARTICLE IV.

DEFERRAL OF COMPENSATION AND EXCESS AMOUNTS

4.1 Amount and Time of Election to Defer

(a) Time of Election. A Participant’s Election to defer compensation for services performed during a Plan Year shall be made not later than the close of the preceding Plan Year, or such other time as provided in Treasury Regulations published under Code section 409A; provided that in the case of the first Plan Year in which a Participant becomes eligible to participate in the Plan, such Election may be made with respect to services to be performed subsequent to the Election within thirty (30) days after the Participant becomes eligible to participate in the Plan. A Participant’s Election to defer that part of Compensation which constitutes Bonus that constitutes Performance-Based Compensation based on services over a period of at least twelve (12) months in and for a Plan Year shall be made no later than six (6) months before the end of that Plan Year to the extent permitted by Code section 409A.

(b) Participant Election Amounts. With respect to each Plan Year, a Participant may voluntarily elect the deferral of compensation by making an Election for deferral of or within the percentages stated below, and subject to the terms described in Exhibit C attached hereto; provided, that each Participant who makes an Election for a Plan Year may elect a deferral that is within or consists of one (1) or more of the following allowable percentages (in one percent (1%) increments) and types of compensation and amounts for that Plan Year, as applicable:

(1) deferral of at least two percent (2%) and not more than ninety percent (90%) of the Participant’s Base Salary for the Plan Year;

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(2) deferral of at least ten percent (10%) and not more than ninety percent (90%) of the Participant’s Bonus for the Plan Year; and

(3) deferral of one hundred percent (100%) of each Qualified Employer Plan Excess Amount (except the Retirement Plan Excess Amount) to be accrued or deferred by or for the Participant for the Plan Year.

(c) Corporation Election Amounts. The Supplemental Credit Amount and Retirement Plan Excess Amount shall be deferred as elected and designated by the Corporation as provided for in Sections 4.3(b) and 7.13, respectively, below.

(d) Election Choices and Effect. The deferral and crediting of Compensation, a Qualified Employer Plan Excess Amount and/or Supplemental Credit Amount to the Account of a Participant shall be made in respect of an Election of a Participant or the Corporation for a Plan Year as follows:

(1) A Participant may elect to defer Base Salary or Bonus for services performed during a Plan Year.

(2) A Participant who does not elect to defer Base Salary or Bonus for services performed during a Plan Year may nevertheless elect to defer a Qualified Employer Plan Excess Amount, (except the Retirement Plan Excess Amount), which shall be deferred and credited to the extent applicable and as provided for and in accordance with Article V, below, for the Plan Year.

(3) Notwithstanding any other provisions herein, a Participant shall be required to elect to defer and have credited all Qualified Employer Plan Excess Amounts (except the Retirement Plan Excess Amount) to which he or she is or becomes entitled to for a Plan Year, and shall not be allowed to defer only one or several of the Qualified Employer Plan Excess Amounts and not others for a Plan Year.

(e) Except as otherwise expressly provided in the Plan in the case of mid-year Elections for new Participants, an Election to defer Base Salary, Bonus, Qualified Employer Plan Excess Amounts or Supplemental Credit Amounts shall not become effective until the next Plan Year following such Election. Except as otherwise directed by the Committee, a Participant’s Base Salary and Bonus deferral Elections will remain in effect for all subsequent Plan Years unless such Participant revokes or modifies any such Election in a manner consistent with this Article IV and applicable law.

(f) Notwithstanding anything herein or in any other plan document to the contrary, a Participant’s Election of a Qualified Employer Plan Excess Amount for a Plan

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Year shall be determined as of the last business day before the Plan Year commences and shall remain fixed for the duration of that Plan Year. Accordingly, no change to the amounts deferred or contributed by a Participant under another plan sponsored by the Corporation during a Plan Year shall have any effect on the Qualified Employer Plan Excess Amount deferred and credited under this Plan for the same Plan Year.

4.2 Deferral Periods; Payment

(a) Participant Elections of Specified Time of Distribution. Every Election made by a Participant shall include a specific election of the Participant of deferral of Compensation (i) to be paid or distributed at a Specified Time or pursuant to a Fixed Schedule, and (ii) in a specific form of payment stated in the Election.

(b) Deferral of Base Salary or Bonus. Subject to the requirements of Section 4.2(d), below, a Participant shall be allowed to defer Base Salary or Bonus under the Plan by electing either a Long-Term Deferral or a Short-Term Deferral. The Participant shall elect and designate his or her deferral period as either a Long-Term Deferral or a Short-Term Deferral in the Election and Participation Agreement filed by the Participant with the Committee for a Plan Year.

(c) Qualified Employer Plan Excess Amounts, Supplemental Credit Amounts; Only Long-Term Deferral. Subject to the requirements of Section 4.4, below, every Election to defer and credit with a Qualified Employer Plan Excess Amount and/or a Supplemental Credit Amount shall be a Long-Term Deferral.

(d) Early Separation from Service. Notwithstanding the foregoing or any Specified Time or form of payment elected by a Participant in his/her Election or otherwise elected and specified by the Corporation pursuant to Plan, or in any allowed Subsequent Election, in the event the Participant has an Early Separation from Service the Participant’s Plan Benefit shall be paid and distributed to the Participant in a single lump sum payment at the Participant’s Early Separation from Service Time of Distribution, except for Short-Term Deferral installment payments that have already commenced, as described and provided in Section 7.7 of the Plan. The time and form of payment in event of an Early Separation from Service is determined and specified by the Corporation under the Plan, and a Participant may not change or modify such time and form of payment, and may not elect otherwise by his/her Election or any Subsequent Election.

(e) The Investment Return and/or any other actual, notional or deemed earnings credited to a Participant’s Account pursuant to this Plan with respect to any Deferred Compensation by an Election of a Participant or the Corporation shall be paid at the same time and in the same form of payment as the Participant has elected in his/her Election for such Deferred Compensation, and no separate election or time or form of payment shall be allowed or occur with respect to the Investment Return or other earnings credited.

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4.3 Committee Authority; Deferral of Compensation

(a) General. Subject to the requirements of Section 4.4, below, the Committee may, in its sole discretion, determine and direct that the amount of deferral and period of deferral which may be elected for Deferred Compensation, for any particular Plan Year or other period of service, be limited to an amount or amounts, and for a period or periods other than that which is otherwise generally provided herein.

(b) Supplemental Credit Amount. The Committee may elect to have a Supplemental Credit Amount credited to the Account of a Participant with respect to a Plan Year. A Supplemental Credit Amount shall be established and deferred by irrevocable designation of the time and form of payment by the Corporation, by the written action and election of the Committee or its designee, which shall be made no later than the later of the time the Participant becomes entitled to the amount thereof by such designation, or if later, the time the Participant would be required to make an election if the Participant were provided such election. The Corporation by this Plan designates that each such Supplemental Credit Amount designated by it in a Plan Year shall be deferred for the same period, and be payable at the same Specified Time and in the same form of payment as the Long-Term Deferrals of and for a Participant for that Plan Year. A Participant shall have no right or opportunity to make any election with respect to the amount, deferral and the time and form of payment of a Supplemental Credit Amount.

4.4 General Requirements for All Elections

Notwithstanding anything to the contrary expressed or, implied herein, the following requirements stated in this Section 4.4 shall apply to the Plan and to all Elections by Participants under the Plan.

(a) Time of Election. The deferral of Compensation for services performed by a Participant may be deferred by Election only if the Election to defer compensation payable with respect to services performed by the Participant in the immediately following year is made and becomes irrevocable not later than the close of the Plan Year (December 31), or such other time as is provided for in Treasury Regulations issued under Code section 409A. Each Election to defer Compensation shall be made not later than the close of the Participant’s taxable year preceding the service year. Provided, that in the case of the first year in which a Participant is eligible to participate in the Plan, such Election may be made with respect to services to be performed subsequent to the Election within thirty (30) days after the date the Participant becomes eligible to the participate in the Plan. Provided, further, in the case of any Performance-Based Compensation based on services performed over a period of at least twelve (12) months, such Election may be made on or before the date that is six (6) months before the end of the performance period, provided that the Participant performs services continuously from the later of the beginning of the performance period or the date the performance criteria are established through the date an Election is made, and in no event may such an Election to defer Performance-Based Compensation be made after such Performance-Based Compensation has become readily ascertainable.

(b) Time and Form of Payment. Every Election to defer compensation shall include an election as to the Specified Time and form of payment and distribution of the Compensation deferred.

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4.5 Subsequent Elections

(a) General. Any Subsequent Election that is made under the Plan to elect a delay in a payment or a change in the form of payment of compensation deferred by an Election under the Plan, shall not take effect until at least twelve (12) months after the date on which it is made. In the case of a Subsequent Election related to a payment to be made upon Separation from Service of a Participant, at a Specified Time or pursuant to a Fixed Schedule, or upon a Change in Ownership or Control, the first payment with respect to which Subsequent Election is made shall be deferred for a period of not less than five (5) years from the date such payment would otherwise have been made, and any such Subsequent Election related to a payment at a Specified Time or pursuant to a Fixed Schedule may not be made less than twelve (12) months prior to the date of the first scheduled payment to which it relates. No Subsequent Election that does not comply with the provisions of Code section 409A and Treasury Regulations shall be allowed to be made under the Plan.

(b) A Participant by or for whom an Election to defer compensation has been made under the Plan may make a Subsequent Election to change the time of payment of such deferred compensation by written instrument filed with the Committee in such form as it may prescribe at least twelve months (12) prior to the date of the first scheduled payment to which it relates.

(c) A Participant who has not made any prior Subsequent Election to change the Normal Specified Time of Distribution of deferred compensation under the Plan provided for in the Election shall be allowed to make a Subsequent Election applicable to such Normal Specified Time of Distribution in accordance with this Section 4.5 and the other provisions of the Plan.

(d) A Participant who has made a prior Subsequent Election of a Subsequent Election Specified Time of Distribution of Deferred Compensation under the Plan shall be allowed to make another Subsequent Election applicable to such Subsequent Election Specified Time of Distribution in accordance with this Section 4.5 and other provisions of the Plan.

(e) A Participant shall not be authorized to make changes between Long-Term and Short-Term Deferrals elected or provided for in an Election by making a Subsequent Election.

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(f) The Committee shall be authorized to administer, construe and interpret the foregoing provisions and the Plan with respect to all Subsequent Elections to assure compliance with the intent thereof and the requirements of the Plan and of Code section 409A and Treasury Regulations.

(g) Notwithstanding the foregoing provisions, the Committee, in its sole discretion, shall be authorized to determine, from time to time and/or in the particular case of any one or more Participants, that a Subsequent Election not be allowed to be made to change the time of payment of deferred compensation under the Plan.

4.6 Crediting Deferred Base Salary and Bonus

The amount of Base Salary that a Participant elects to defer pursuant to an Election of the Participant under the Plan shall be credited by the Employer to the Participant’s Account monthly. The amount of Bonus that a Participant elects to defer pursuant to an Election of the Participant under the Plan shall be credited by the Employer to the Participant’s Account at the time the Bonus would otherwise be paid or payable to the Participant under the Incentive Plan pursuant to which such Bonus is paid or payable.

4.7 Crediting of Plan Excess Amounts

The amount of any Qualified Employer Plan Excess Amount or Supplemental Credit Amount that a Participant or the Corporation elects to defer pursuant to an Election of the Participant or the Corporation shall be credited in accordance with Article V, below.

4.8 FICA and Other Taxes

For each Plan Year during which a Participant has deferrals, the Participant’s Employer shall, in a manner determined by the Employer, withhold the Participant’s share of FICA and other required employment or state, local, and foreign taxes on deferrals from that portion of the Participant’s Base Salary or Bonus, and in the event of any Qualified Employer Plan Excess Amounts (except the Retirement Plan Excess Amount) or a Supplemental Credit Amount, the Participant’s compensation generally, that is not deferred. To the extent permitted by Code section 409A, the Committee may reduce a Participant’s deferrals to the extent necessary to pay FICA and other employment, state, local and foreign taxes.

ARTICLE V.

PLAN EXCESS AMOUNTS

5.1 General

(a) Qualified Employer Plan Excess Amounts. There shall be deferred and credited to the Account of a Participant the Qualified Employer Plan Excess Amounts (except the Retirement Plan Excess Amount) that apply to such Participant for the Plan Year by reason or and based upon his/her participation during the Plan Year in one or more qualified defined contribution plans or defined benefit plans of the

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Corporation, as more particularly described and provided for in this Article V, including the Thrift Plan, Profit Sharing Plan and Retirement Plan. A Participant shall be entitled to defer and have credited to his/her Account such Qualified Employer Plan Excess Amounts (except the Retirement Plan Excess Amount) to the extent he/she is a participant in the qualified plan of the Corporation and his/her participation in, and benefits under such qualified plan come under and are affected in the manner described herein below.

(b) Supplemental Credit Amount. There shall be deferred and credited to the Account of a Participant Supplemental Credit Amounts that apply to such Participant for the Plan Year by reason or and based upon his/her entitlement thereto during the Plan Year as specified in the written authorization and direction of the deferral and credit thereof by the Corporation. A Participant shall be entitled to defer and have credited to his/her Account such Supplemental Credit Amounts to the extent provided for in such authorization.

5.2 Thrift Plan Excess Employee Amount

(a) The Employer shall provide and credit a Thrift Plan Excess Employee Amount elected under this Plan for each Participant making an Election thereof and eligible to make and be allocated contributions under the Thrift Plan; except that the Committee may, in its discretion, prior to any Plan Year, make a determination not to provide for the election and crediting of Thrift Plan Excess Employee Amounts for that Plan Year.

(b) The Thrift Plan Excess Employee Amount under the Plan for each Participant under this Section 5.2 shall be credited by the Employer as soon as practicable after the time the related contributions and allocations are made under the Thrift Plan, and no later than ninety (90) days after the end of the Plan Year that includes the time that the related contributions and allocations are made under the Thrift Plan.

5.3 Thrift Plan Excess Matching Amount

(a) The Employer shall provide and credit a Thrift Plan Excess Matching Amount elected under this Plan with respect to each Participant making an Election thereof and eligible to be allocated matching contributions under the Thrift Plan; except that the Committee may, in its discretion, prior to any Plan Year, make a determination not to provide for the crediting of Thrift Plan Excess Matching Amounts for that Plan Year.

(b) The Thrift Plan Excess Matching Amount under the Plan for each Participant under this Section 5.3, above, shall be credited by the Employer as soon as practicable after the time the related matching contributions are made under the Thrift Plan, and no later than ninety (90) days after the end of the Plan Year that includes the time that the related matching contributions are made under the Thrift Plan.

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5.4 Profit Sharing Plan Excess Amount

(a) The Employer shall provide and credit a Profit Sharing Plan Excess Amount under this Plan with respect to each Participant making an Election thereof and eligible to be allocated contributions under the Profit Sharing Plan; except that the Committee may, prior to any Plan Year, make a determination not to provide for the crediting of Profit Sharing Plan Excess Amounts for that Plan Year.

(b) The Profit Sharing Plan Excess Amount under the Plan for each Participant under this Section 5.4, shall be credited by the Employer as soon as practicable after the time the related contributions and allocations are made under the Profit Sharing Plan, and no later than ninety (90) days after the end of the Plan Year that includes the time that the related contributions and allocations are made under the Profit Sharing Plan.

5.5 Retirement Plan Covered Compensation Excess Amount

(a) The Employer shall provide and credit a Retirement Plan Covered Compensation Excess Amount elected and deferred under this Plan for each Participant making an Election thereof and eligible to participate in the Retirement Plan, and not participating in the ONE Gas, Inc. Supplemental Executive Retirement Plan; except that the Committee may, in its discretion, prior to any Plan Year, make a determination not to provide for the election and crediting of Retirement Plan Covered Compensation Excess Amounts for that Plan Year.

(b) The Retirement Plan Covered Compensation Excess Amount under the Plan for a Participant under this Section 5.5 shall be credited by the Employer as soon as practicable after the time the related accruals and contributions are made under the Profit Sharing Plan, and no later than ninety (90) days after the end of the Plan Year that includes the time that the related contributions and allocations are made under the Profit Sharing Plan.

5.6 Supplemental Credit Amount

(a) The Employer shall provide and credit a Supplemental Credit Amount if elected and deferred by the Corporation under this Plan for each Participant; except that the Committee may, in its discretion, prior to any Plan Year, make a determination not to provide for the election and crediting of Supplemental Credit Amounts for that Plan Year.

(b) The Supplemental Credit Amount under the Plan for a Participant under this Section 5.6 shall be credited by the Employer as soon as practicable after the beginning of the Plan Year for which an election is made, and no later than ninety (90) days after the end of the Plan Year.

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5.7 Required Elections to Defer Excess Amounts

The deferral, allowance, provision of and crediting of a Qualified Employer Plan Excess Amount shall be made and administered under this Plan if and to the extent elected by a Participant in such Participant’s Election made pursuant to and in accordance with the terms and provisions of Article IV. Provided, that Retirement Plan Excess Amounts deferred under this Plan are separately provided for and made payable under the Plan pursuant to and in accordance with Section 7.13 of the Plan; and Supplemental Credit Amounts are elected and made payable as determined by the Committee in accordance with Section 4.3(b) of the Plan.

ARTICLE VI.

BENEFIT ACCOUNTS

6.1 Determination of Account

As of each Determination Date, a Participant’s Account shall consist of the balance of the Participant’s Account as of the immediately preceding Determination Date, plus the Participant’s Deferred Compensation credited pursuant to Article V since the immediately preceding Determination Date, plus investment return credited as of such Determination Date pursuant to Section 6.2, minus the aggregate amount of distributions, if any, made from such Account since the immediately preceding Determination Date.

6.2 Crediting of Investment Return; Other Items to Participant Accounts

The Account of each Participant shall be periodically credited and increased, or debited and reduced, as the case may be, by the amount of investment return specified under Section 6.3. The Account of each Participant shall also be debited and credited for any deemed purchases or sales of, or other deemed transactions involving securities provided for under the Plan. The Account shall be so credited and debited not less frequently than monthly in the manner established and determined from time to time by the Committee, in its sole discretion. The manner in which the Committee determines that a Participant’s Account shall be so debited or credited shall be described in written rules or procedures which shall be stated from time to time by a written description thereof which shall be attached to this Plan as Exhibit “E,” and furnished to the Participants in the Plan.

6.3 Investment Return; Designated Deemed Investment

The Investment Return shall be determined in the manner specified in Exhibit “D” attached hereto.

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To the extent the Investment Return specified in Exhibit “D” attached hereto, applied to a Participant’s deferrals includes a rate that is to be determined from deemed investment of such Participant’s Account in investment options specified therein, the Committee shall prescribe the manner and form in which a Participant may designate the deemed investment of deferrals and other amounts in his or her Account. A Participant will be allowed to change such designation of deemed investment monthly or with such other frequency as specified by the Committee, in its sole discretion. Provided, that notwithstanding anything to the contrary stated or implied by the Plan, including all Exhibits thereto, the use, reference to or consideration of any such deemed investments made by the Committee or Plan, or designated by Participants, the Committee and the Corporation shall not be obligated to make or cause to be made any particular type or form of investment with respect to the funding or payment of the Plan Benefits or Accounts of Participants under the Plan, and no Participant shall have the right to direct or in any manner control any actual investments, if any, made by the Employer or any other person for purposes of providing funds for paying liabilities of the Employer for benefits or otherwise under the Plan. No Participant shall have any ownership or beneficial interest in any such actual investments made by the Employer.

6.4 Statement of Account

The Committee shall provide to each Participant a statement each calendar quarter setting forth the balance or balances of such Participant’s Account which have attributed an Investment Return as of the end of the calendar quarter showing all adjustments made thereto during such calendar quarter.

6.5 Vesting of Participant Accounts

Except as provided in Sections 10.1 and 10.2, below, a Participant shall be one hundred percent (100%) vested in his or her Account, at all times; provided that the vesting of a Participant’s Retirement Plan Excess Amount shall be determined in like manner as the vesting of the Participant’s accrued benefit under the Retirement Plan.

ARTICLE VII.

PAYMENT OF BENEFITS

7.1 Requirements for Distributions and Payments

Notwithstanding anything to the contrary expressed or implied herein, the following requirements stated in this Section 7.1 shall apply to the Plan, to all Elections or Subsequent Elections made by Participants under the Plan, and to all distributions and payments made pursuant to the Plan.

(a) Any Compensation deferred under the Plan shall not be distributed earlier than

(1) Separation from Service of the Participant,

(2) the date the Participant becomes Disabled,

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(3) death of the Participant,

(4) a Specified Time (or pursuant to a Fixed Schedule) specified under the Plan at the date of deferral of such Compensation,

(5) a Change in Ownership or Control, or

(6) the occurrence of an Unforeseeable Emergency.

(b) Notwithstanding the foregoing, if a Participant becomes entitled to a distribution on account of the Participant’s Separation from Service and is a Specified Employee on the date of the Separation from Service, no distribution shall be made before the date which is six (6) months after the date of the Participant’s Separation from Service, or, if earlier, the date of death of such Participant.

(c) No acceleration of the time or schedule of any distribution or payment under the Plan shall be permitted or allowed, except to the extent provided in Treasury Regulations issued under Code Section 409A.

(d) A Participant may elect to change the time of commencement or change the form of payment of Compensation deferred under the Plan by filing a Subsequent Election in accordance with Section 4.5 and rules, procedures and forms as may be specified from time to time by the Committee.

7.2 Payment of Plan Benefit; Long-Term Deferrals

Subject to the requirements stated in Section 7.1, above, and Section 7.7 below, a Long-Term Deferral of Deferred Compensation shall be paid and distributed to the Participant at the Normal Specified Time of Distribution elected by a Participant (the Participant’s Separation from Service after attaining fifty (50) years of age and the completion of five (5) years of service with the Corporation). The Employer shall pay to the Participant the Plan Benefit in the form of payment specified and elected in the Participant’s Election and Participation Agreement pursuant to Section 7.5.

7.3 Payment of Plan Benefit; Short-Term Deferrals

Subject to the requirements stated in Section 7.1, above, and Section 7.7 below, a Short-Term Deferral of Compensation elected by a Participant shall be paid and distributed to a Participant at the Specified Time or pursuant to the Fixed Schedule designated and elected by the Participant in his or her Election and Participation Agreement. The Employer shall pay to the Participant the Plan Benefit in the form of benefit specified and elected in the Participant’s Election pursuant to Section 7.5; provided, that no part of a Short-Term Deferral may be paid prior to five (5) years following the Participant’s Election thereof.

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7.4 Specified Employee Six (6) Month Required Delay in Distribution and Payment

In the case of any Participant who is a Specified Employee as of the date of a Separation from Service, distribution and payments of any deferred compensation and Plan Benefit may not be made before the date that is six (6) months after the date of Separation from Service (or, if earlier than the end of the six-month period, the date of death of the Specified Employee). For this purpose, a Participant who is not a Specified Employee as of the date of a Separation from Service will not be treated as subject to this requirement even if the Participant would have become a Specified Employee if the Participant had continued to provide services through the next Specified Employee Effective Date; and a Participant who is treated as a Specified Employee as of the date of a Separation from Service will be subject to this requirement even if the Participant would not have been treated as a Specified Employee after the next Specified Employee Effective Date had the Specified Employee continued in employment with the Corporation through the next Specified Employee Effective Date. The required delay in payment is met if payments to which a Specified Employee would otherwise be entitled during the first six (6) months following the date of Separation from Service are accumulated and paid on the first day of the seventh month following the date of Separation from Service, or if each payment to which a Specified Employee is otherwise entitled upon a Separation from Service is delayed by six (6) months. The Committee shall have and retain discretion to choose which method will be implemented, provided that no direct or indirect election as to the method may be provided to the Participant. For an affected Specified Employee, a date upon which the Committee or the Corporation designates that the payment will be made after the six-month delay is treated as a fixed payment date for purposes of the other requirements of the Plan once the Separation from Service has occurred.

7.5 Form of Distribution and Payment

The Plan Benefit payable to a Participant for Deferred Compensation shall be distributed and paid in one of the following forms, as elected by the Participant in and at the time of his or her Election.

(a) For Participants who elect a Long-Term Deferral, the Plan Benefit shall be distributed and paid in one of the following elected forms elected by the Participant in such Election:

(1) In annual payments of the vested Account balance, on and after the payment commencement date over a period of either five (5) or fifteen (15) years (together, in the case of each annual payment, with Investment Return thereon credited after the payment commencement date pursuant to Section 6.2), with the amount of each such annual payment to be determined by multiplying the remaining principal amount and undistributed income in the Participant’s Account by a fraction, the numerator of which is one (1) and the denominator of which shall be the number of remaining annual payments, including the payment then being calculated; or

(2) A lump sum.

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(b) For Participants who elect a Short-Term Deferral, the Plan Benefit shall be distributed and paid in one of the following forms elected by the Participant in such Election:

(1) Annual payments of a fixed amount which shall amortize the vested Account balance, on and after the payment commencement date over a period of from two (2) to four (4) years (together, in the case of each annual payments with Investment Return thereon credited after the payment commencement date pursuant to Section 6.2), with the amount of each such annual payment to be determined by multiplying the remaining principal amount and undistributed income in the Participant’s Account by a fraction, the numerator of which is one (1) and the denominator of which shall be the number of remaining annual payments, including the payment then being calculated; or

(2) A lump sum.

(c) For any Participant who has an Early Separation from Service, the Plan Benefit shall be distributed in a single lump sum payment, except for Short-Term Deferral installment payments that have already commenced, as provided for in Section 7.7 below.

7.6 Distribution and Payment for Subsequent Elections

If a Subsequent Election is made pursuant to the Plan, the payment and distribution shall be made at the Subsequent Election Time of Distribution that is elected and determined in and by such Subsequent Election.

7.7 Distribution and Payment for Early Separation from Service

Subject to the requirements stated in Section 7.1, above, and notwithstanding the foregoing provisions in Sections 7.2 and 7.3, a Long-Term Deferral and/or Short-Term Deferral shall be paid and distributed to a Participant upon his/her Early Separation from Service. The Employer shall pay to the Participant his/her Plan Benefit in a single lump sum payment equal to the balance of the Participant’s Account determined pursuant to Article VI. This lump sum payment shall be made notwithstanding any other period or time of payment that has been elected by the Participant. Provided, that any installment payments of a Short-Term Deferral to the Participant that have commenced and not been completed at such time shall continue to be paid in accordance with the existing schedule of payments.

7.8 Distribution and Payment of Plan Benefit Upon Disability

(a) Subject to the requirements stated in Section 7.1, above, if a Participant becomes Disabled, the Participant’s Account shall be paid to the Participant, or the Participant’s personal representative, upon the date the Participant is determined by the Committee to be Disabled. The Participant’s Account shall be distributed in accordance with the Participant’s Long-Term Deferral and Short-Term Deferral

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Elections if the Participant has attained the age of fifty (50) years and completed five (5) years of service with the Corporation upon the date the Participant is determined Disabled. If the Participant has not attained the age of fifty (50) years and completed five (5) years of service with the Corporation as of the date the Participant is determined to be Disabled, the Participant’s Account shall be paid in a lump sum. Notwithstanding the foregoing, any installment payments of a Short-Term Deferral to the Participant that have commenced and not been completed at such time shall continue to be paid in accordance with the existing schedule of payments.

(b) Notwithstanding any other provisions of the Plan, if a Participant becomes disabled, the Committee may, in its sole discretion, cancel the Participant’s deferral Election with respect to amounts to be deferred on or after the cancellation, by the end of the year during which the Participant becomes disabled, or if later, the 15th day of the third month following the date the Participant becomes disabled. For purposes of this Section 7.8(b), a Participant shall be disabled if the Participant is suffering from any medically determinable physical or mental impairment resulting in the Participant’s inability to perform the duties of his or her position or any substantially similar position, if such impairment can be expected to result in death or can be expected to last for a continuous period of not less than six (6) months. The Participant may elect to defer amounts for the Plan Year following his return to employment and for every Plan Year thereafter while an Eligible Employee, provided the Participant’s deferral election complies with all the requirements of the Plan.

7.9 Distribution and Payment of Plan Benefit Upon Death

Subject to the requirements stated in Section 7.1, above, upon the death of a Participant the Participant’s Account shall be paid to the Participant’s Beneficiary. If the Participant has elected Long-Term Deferral, the Plan Benefit shall be paid to the Beneficiary over the time period elected by the Participant commencing as soon as practicable after the time of death of the Participant. If the Participant has elected a Short-Term Deferral, the Plan Benefit shall be paid to the Beneficiary in a single lump sum payment. However, the Retirement Plan Excess Amount will be paid to the same beneficiary as the Retirement Plan benefit.

7.10 Payment of Deferrals for Unforeseeable Emergency

Subject to the requirements stated in Section 7.1, above, a Participant may submit a written request for a distribution on account of an Unforeseeable Emergency. Upon approval by the Committee of a Participant’s request, the Participant’s Account, or that portion of the Participant’s Account deemed necessary by the Committee to satisfy the Unforeseeable Emergency (determined in a manner consistent with Code section 409A) plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, will be distributed in a single lump sum payment. In addition, the Participant must continue to defer Compensation subsequent to such distribution in accordance with the Participant’s Election and will not be permitted to elect to defer Compensation attributable to the calendar year subsequent to the calendar year of the distribution. The Committee shall have the sole discretion as to whether such distribution shall be made, and its determination shall be final and conclusive. In making its determinations, the Committee shall follow a uniform and nondiscriminatory practice.

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7.11 Commencement of Distributions and Payments

(a) Subject to the requirements stated in Section 7.1, above, and except as otherwise provided in Section 7.2, the commencement of payments under Sections 7.2 through 7.4 shall begin at the time specified by the Participant in his or her Election and Participation Agreement consistent with the terms and provisions of the Plan or Subsequent Election, and distributions required upon distribution events described in Sections 7.7 through 7.10 shall commence at the time provided in the Plan or Subsequent Election (if applicable).

(b) Except as otherwise expressly specified in the Plan, a distribution or payment shall be treated as made upon the date specified under the Plan if the payment is made at such date or a later date within the same taxable year of the Participant or, if later, by the 15th day of the third calendar month following the date specified under the Plan and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. In addition, a distribution or payment shall be treated as made upon the date specified under the Plan and shall not treated as an accelerated payment if the payment is made no earlier than thirty (30) days before the designated payment date and the Participant is not permitted, directly or indirectly to designate the taxable year of the payment. For purposes of this paragraph, if the date specified is only a designated taxable year of the Participant, or a period of time during such a taxable year, the date specified under the Plan is treated as the first day of such taxable year or the first day of the period of time during such taxable year, as applicable. If calculation of the amount of the distribution or payment is not administratively practicable due to events beyond the control of the Participant (or Participant’s beneficiary), the distribution or payment will be treated as made upon the date specified under the Plan if the distribution or payment is made during the first taxable year of the Participant in which the calculation of the amount of the distribution or payment is administratively practicable. For purposes of this section, the inability of a Corporation to calculate the amount or timing of a distribution or payment due to a failure of a Participant (or Participant’s beneficiary) to provide reasonably available information necessary to make such calculation does not constitute an event beyond the control of the Participant.

(c) If a Participant elects to receive distributions in annual installments, the Participant’s Account or portion thereof will be paid in substantially equal annual installments in consecutive years over the period elected by the Participant. During the Plan Year in which distributions commence, the Participant will receive the first installment commencing as described in Section 7.11(a) and each subsequent annual installments shall be paid in the year in which it is due after the first day of the month following the anniversary date of the commencement date. Any installment distribution that complies with Section 7.11(b) shall be deemed for all purposes to comply with the Plan requirements regarding the time and form of distributions.

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7.12 No Acceleration of Distribution and Payment

No acceleration of the time or schedule of any payment or amount scheduled to be paid pursuant to the terms of the Plan shall be allowed, and no such accelerated payment may be made whether or not provided for under the expressed or implied terms of such Plan. Provided, that there may be an acceleration of a payment in accordance with the express provisions allowing the same under the Treasury regulations issued under Code Section 409A or the Committee may have discretion to permit such acceleration to be made consistent with the regulations. Provided, that a Participant shall have no discretion with respect to whether a payment will be accelerated, and the Corporation or Committee shall not provide a Participant a direct or indirect election as to whether the Corporation’s or Committee’s discretion to accelerate a payment will be exercised, even if such acceleration would be permitted under the regulations.

7.13 Retirement Plan Excess Amount

Subject to the requirements stated in Section 7.1, above, the Corporation shall pay to a Participant or his or her survivor Beneficiary, as the case may be, a Retirement Plan Excess Amount elected to be deferred and credited for the Participant by the Corporation that shall be equal to the amount by which such Participant’s retirement benefit under the Retirement Plan is reduced by reason of the deferred Compensation elected by the Participant under the Plan not being taken into account in the calculation of such Participant’s retirement benefit under the Retirement Plan, but only if such deferred Compensation is not taken into account in determining a retirement benefit or payment payable to such Participant under the ONE Gas, Inc., Supplemental Executive Retirement Plan (SERP), nor under any other plan, arrangement or agreement of the Corporation other than this Plan.

The Retirement Plan Excess Amount payable to a Participant, or his or her Beneficiary, under this Section 7.13 shall be paid commencing at the date of the Participant’s Normal Specified Time of Distribution under this Plan and the amount thereof shall be calculated pursuant to the Retirement Plan benefit formula in the manner it would be calculated if the Participant commenced payment of his/her Retirement Plan benefits at that time. However, if Participant is a SERP participant, the time and form of payment of the Participant’s Retirement Plan Excess Amount under this Plan shall be the time and form of payment that the Participant has made or makes under the SERP as to the time and form of payment of his/her benefits under the SERP; provided that such election under the SERP shall be considered an election by the Participant under this Plan that is subject to application of all pertinent requirements, restrictions and limitations of this Plan with respect to the time of making and effect of an Election or Subsequent Election, and/or the prohibition of an acceleration of payment of the Retirement Plan Excess Amount; and provided further, that to the extent that such an election would not comply with any of such requirements, restrictions or limitations, the time of payment shall be the Normal Specified Time of Distribution. The Retirement Plan Excess Amount shall be paid in the form of a 50% joint and survivor annuity, as defined in the Retirement Plan, if the Participant is

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married at the time of the Corporation’s Election to credit the Participant’s Account with a Retirement Plan Excess Amount, and shall be paid in the form of a single (straight) life annuity, as defined in the Retirement Plan, if the Participant is single at the time of the Corporation’s Election. The form of payment can be changed by Participant prior to commencement to another actuarially equivalent form of monthly annuity.

ARTICLE VIII.

BENEFICIARY DESIGNATION

8.1 Beneficiary Designation

Each Participant shall have the right, at any time, to designate any person or persons as his or her Beneficiary to whom payment under the Plan shall be made in the event of the Participant’s death prior to complete distribution to the Participant of his or her Account; provided, that the Retirement Plan Excess Amount shall be paid to the Participant’s beneficiary for Retirement Plan benefits. Any Beneficiary designation shall be made in a written instrument provided by the Committee. All Beneficiary designations must be filed with the Corporation and shall be effective only when received in writing by the Corporation.

8.2 Amendments

Any Beneficiary designation may be changed by a Participant by the filing of a new Beneficiary designation, which will cancel all the Participant’s prior Beneficiary designations filed with the Committee.

8.3 No Designation

If a Participant fails to designate a Beneficiary as provided above, or if all designated Beneficiaries predecease the Participant, then the Participant’s designated Beneficiary shall be deemed to be the Participant’s estate.

8.4 Effect of Payment

Payment to a Participant’s Beneficiary (or, upon the death of a primary Beneficiary, to the contingent Beneficiary or, if none, to the Participant’s estate) shall completely discharge the Employer’s obligations under the Plan.

ARTICLE IX.

ADMINISTRATION

9.1 Plan Committee; Authority and Duties

(a) The Plan shall be administered by the Committee, which shall consist of not less than three (3) members, appointed from time to time by the Board to serve at the pleasure of the Board.

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(b) Notwithstanding anything to the contrary expressed or implied herein, no member of the Committee shall have any right or authority to act, vote or decide upon any matter relating solely to such member under the Plan, or to act, vote upon or decide any issue or case in which such member’s individual right to receive any Compensation under the Plan is particularly involved, or to take any action that would change or accelerate the deferral or payment of Compensation or benefits to such member in a manner or at a time not provided for under the Plan. In any case in which a member of the Committee is so disqualified to act and the remaining members cannot agree, or in any case where a majority or all of the members of the Committee are so disqualified, the Board (or a separate subset thereof) shall appoint a substitute member or members of the Committee to exercise all powers of the disqualified member or members concerning the matter involved, or in the alternative the Board (or a separate subset thereof) may, in its discretion, assume authority to act upon and decide the issues and case involved, with any such action and decision by it to be final and binding with respect to the Plan, Participants or other persons involved.

The Committee and its members shall have no discretion to allow or cause distribution or payment of the Account or any deferred compensation to any Participant at a time or in a form or manner that is not in accordance with the terms and provisions of the Plan, including the requirements of Section 7.1, above, and the requirements of Code Section 409A.

(c) The Committee shall supervise the administration and operation of the Plan, may from time to time adopt rules and procedures governing the Plan and shall have authority to give interpretive rulings with respect to the Plan. The Committee shall have such other powers and duties as are specified in this Plan as the same may from time to time be constituted, and not in limitation but in amplification of the foregoing, the Committee shall have power, in its discretion to the exclusion of all other persons, to interpret the provisions of this instrument, to decide any disputes which may arise hereunder; to construe and determine the effect of Participant Agreements, Elections, beneficiary designations, and other actions and documents; to determine, in its discretion, all questions that shall arise under the Plan, including questions as to the rights of Employees to become Participants, as to the rights of Participants, any Beneficiary or other person with respect to the Plan, and including questions submitted by the trustee of a Trust created under Section 11.2 on all matters necessary for it properly to discharge its duties, powers, and obligations; to employ legal counsel, accountants, consultants and agents; to establish and modify such rules, procedures and regulations for carrying out the provisions of the Plan not inconsistent with the terms and provisions hereof, as the Committee, in its discretion, may determine; and in all things and respects whatsoever, without limitation, to direct the administration of the Plan and any such Trust with the trustee being subject to the direction of the Committee.

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(d) The Committee may supply any omission or reconcile any inconsistency in this instrument in such manner and to such extent as it shall deem expedient to carry the same into effect and it shall be the sole and final judge of such expediency.

(e) The Committee may adopt such rules and regulations with respect to the signature by an Employee, Participant and/or Beneficiary as to any agreements, Elections or other papers to be signed by Employees or Participants or Beneficiaries and similar matters as the Committee shall determine in view of the laws of any state or states.

(f) The Committee shall maintain or cause to be maintained complete and adequate records pertaining to the Plan, including but not limited to the Accounts of Participants, all matters involving any Trust of the Plan, and all other records which the Committee in its discretion determines are necessary or desirable in the administration of the Plan.

(g) Any act which the Plan authorizes or requires the Committee to do may be done by a majority of the then members of the Committee. The action of such majority of the members expressed either by a vote at a meeting or in writing without a meeting, shall constitute the action of the Committee and shall have the same effect for all purposes as if assented to by all of the members of the Committee at the time in office, provided, however, that the Committee may, in specific instances, authorize one (1) of its members to act for the Committee when and if it is found desirable and convenient to do so.

9.2 Delegation; Agents

The Committee may, at its discretion, delegate discretionary authority for day-to-day administration of the Plan to the Company’s Benefit Plan Administration Committee or its authorized representatives pursuant to a duly adopted resolution or a memorandum of action signed by all members of the Committee or approved via electronic transmission. All actions taken by the Company’s Benefit Plan Administration Committee or its authorized representative shall have the same legal effect and shall be entitled to the same deference as if taken by the Committee itself. In addition, the Committee or its delegate may, from time to time, employ other agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with counsel who may be counsel to the Corporation.

9.3 Binding Effect of Decisions

Any decision or action of the Committee with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan shall be final and binding upon all persons having any interest in the Plan.

9.4 Indemnity of Committee

The Corporation shall indemnify and hold harmless the members of the Committee and their agents duly appointed under Section 9.2 against any and all claims, loss, damage, expense or liability arising from any action or failure to act with respect to the Plan, except in the case of gross negligence or willful misconduct by any such member or agent of the Committee.

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ARTICLE X.

AMENDMENT AND TERMINATION OF PLAN

10.1 Amendment

(a) The Corporation, on behalf of itself and of each Subsidiary may by action of the Board at any time amend, modify, suspend or reinstate any or all of the provisions of the Plan, except that no such amendment, modification, suspension or reinstatement may adversely affect any Participant’s Account, as it existed as of the day before the effective date of such amendment, modification, suspension or reinstatement, without such Participant’s prior written consent.

(b) The Plan may also be so amended or modified by resolution of the Committee or by the Committee executing a written instrument containing such amendment or modification (pursuant to authority which has been duly delegated to the Committee by the Board and is hereby acknowledged and recognized); provided, that no amendment or modification of the Plan to increase any compensation of or benefits provided to Participants under the Plan, and no termination of the Plan shall be made unless such amendment or modification, or termination, is authorized pursuant to a resolution duly adopted by the Board. Any action by resolution or a written instrument by the Committee shall be presumed to be effective without necessity of further action or approval of the Board. In the event any issue should arise with respect to respective authority of the Committee, or of the Board, and amendments or modifications of the Plan made by them that are or appear to be inconsistent, final authority shall be reserved to and exercisable by the Board and its action to amend or modify the Plan shall take precedence.

10.2 Termination

The Corporation, on behalf of itself and of each Subsidiary, in its sole discretion, may by action pursuant to a resolution adopted by the Board terminate this Plan at any time and for any reason, with or without prior notice. Upon termination of the Plan, the Committee shall take those actions necessary to administer any Participant Accounts existing prior to the effective date of such termination; provided, however, that a termination of the Plan shall not adversely affect the value of a Participant’s Account or the crediting of investment return under Section 6.2 without the Participant’s prior written consent.

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ARTICLE XI.

PLAN EFFECT, LIMITATIONS,

MISCELLANEOUS PROVISIONS

11.1 Nature of Employer Obligation; Funding

Participants, their Beneficiaries, and their heirs, successors and assigns, shall have no secured interest or claim in any property or assets of the Employer. The Employer’s obligation under the Plan shall be merely that of an unfunded and unsecured promise of the Employer to pay money in the future.

11.2 Trusts; Transfers of Assets, Property

(a) Notwithstanding the foregoing, in the event of a Change in Ownership or Control, the Corporation shall create an irrevocable Trust, or before such time the Corporation may create an irrevocable or revocable Trust, to hold funds to be used in payment of the obligations of Employers under the Plan.

(b) Notwithstanding anything otherwise expressed or implied herein, in the case of any assets set aside (directly or indirectly) in a such a Trust (or other arrangement determined by Treasury Regulations or otherwise pursuant to Code Section 409A) for purposes of paying deferred compensation under the Plan, no such assets (or such a Trust or other arrangement) shall ever be located or transferred outside the United States.

(c) In the event of a Change in Ownership or Control or prior thereto, the Employers shall fund such Trust in an amount equal to not less than the total value of the Participants’ Accounts under the Plan as of the Determination Date immediately preceding the Change in Ownership or Control, provided that any funds contained therein shall remain liable for the claims of the general creditors of the respective Employers.

(d) Pursuant to this Section 11.2, the Corporation may, without further reference to or action by any Employee, Participant, or any Beneficiary from time to time enter into such further agreements with a trustee or other parties, and make such amendments to said trust agreement or such further agreements, as the Corporation may deem necessary or desirable to carry out the Plan; from time to time designate successor trustees of such a Trust; and from time to time take such other steps and execute such other instruments as the Corporation may deem necessary or desirable to carry out the Plan. The Committee shall advise the trustee of any such Trust in writing with respect to all Plan Benefits which become payable under the terms of the Plan and shall direct the trustee to pay such Plan Benefits from the respective Participants’ Accounts, and the Committee shall have authority to otherwise deal with and direct the trustee of such a Trust in matters pertinent to the Plan.

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(e) It is intended that any Trust created hereunder is to be treated as a “grantor” trust under the Code, and the establishment of such a Trust is not intended to cause a Participant to realize current income on amounts contributed thereto, such a Trust is not intended to cause the Plan to be “funded” under ERISA and the Code, and any such Trust shall be so interpreted, and such Trust shall be funded in a manner that assets set aside or transferred to such Trust shall not be treated under Code Section 409A as property transferred in connection with the performance of services by reason of such assets being located or transferred outside the United States.

(f) Notwithstanding anything to the contrary expressed or implied herein, no transfer of assets shall be made under or in connection with the Plan or Compensation deferred under the Plan that would constitute a transfer of property within the meaning of Code Section 83 with respect to such Compensation by reason of such assets becoming restricted to the provision of benefits under the Plan in connection with a change in the Corporation’s financial health, as provided for under Code Section 409A, and Treasury Regulations issued thereunder.

11.3 Nonassignability

No right or interest under the Plan of a Participant or his or her Beneficiary (or any person claiming through or under any of them), shall be assignable or transferable in any manner or be subject to alienation, anticipation, sale, pledge, encumbrance or other legal process or in any manner be liable for or subject to the debts or liabilities of any such Participant or Beneficiary. If any Participant or Beneficiary shall attempt to or shall transfer, assign, alienate, anticipate, sell, pledge or otherwise encumber his or her benefits hereunder or any part thereof, or if by reason of his or her bankruptcy or other event happening at any time such benefits would devolve upon anyone else or would not be enjoyed by him or her, then the Committee, in its discretion, may terminate such Participant’s or Beneficiary’s interest in any such benefit (including the Account) to the extent the Committee considers necessary or advisable to prevent or limit the effects of such occurrence. Termination shall be effected by filing a written instrument with the Secretary of the Corporation and making reasonable efforts to deliver a copy to the Participant or Beneficiary whose interest is adversely affected (the “Terminated Participant”).

As long as the Terminated Participant is alive, any benefits affected by the termination shall be retained by the Employer and, in the Committee’s sole and absolute judgment, may be paid to or expended for the benefit of the Terminated Participant, his or her spouse, his or her children or any other person or persons in fact dependent upon him or her in such a manner as the Committee shall deem proper. Upon the death of the Terminated Participant, all benefits withheld from him or her and not paid to others in accordance with the preceding sentence shall be disposed of according to the provisions of the Plan that would apply if he or she died prior to the time that all benefits to which he or she was entitled were paid to him or her.

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11.4 Captions

The captions contained herein are for convenience only and shall not control or affect the meaning or construction hereof.

11.5 Code Section 409A

The Corporation intends that the Plan comply with the requirements of Code section 409A and shall be operated and interpreted consistent with that intent. Notwithstanding the foregoing, the Corporation makes no representation that the Plan complies with Code section 409A and shall have no liability to any Participant for any failure to comply with Code section 409A.

11.6 Governing Law

The provisions of the Plan shall be construed and interpreted according to the laws of the State of Oklahoma except to the extent preempted by ERISA.

11.7 Successors

The provisions of the Plan shall bind and inure to the benefit of the Corporation, its Subsidiaries, and their respective successors and assigns. The term “successors” as used herein shall include any corporate or other business entity which shall, whether by merger, consolidation, purchase or otherwise, acquire all or substantially all of the business and assets of the Corporation or a Subsidiary and successors of any such corporation or other business entity.

11.8 No Right to Continued Service

Nothing contained herein shall be construed to confer upon any Eligible Employee the right to continue to serve as an Eligible Employee of the Employer or in any other capacity.

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EX-10.9

Exhibit 10.9

ONE GAS, INC.

PRE-2005 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

(Effective January 1, 2014)

ONE GAS, INC. PRE-2005 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Table of Contents

	Page
ESTABLISHMENT AND PURPOSE		1
ARTICLE I. DEFINITIONS AND CONSTRUCTION		2
ARTICLE II. ELIGIBILITY AND PLAN AGREEMENTS		8
ARTICLE III. DEATH BENEFIT		9
ARTICLE IV. RETIREMENT BENEFIT		9
ARTICLE V. BENEFICIARY		13
ARTICLE VI. LEAVE OF ABSENCE		14
ARTICLE VII. SOURCE OF BENEFITS		14
ARTICLE VIII. TERMINATION OF EMPLOYMENT		15
ARTICLE IX. TERMINATION OF PARTICIPATION		16
ARTICLE X. TERMINATION, AMENDMENT, MODIFICATION, OR SUPPLEMENT OF THE PLAN		16
ARTICLE XI. TREATMENT OF BENEFITS		17
ARTICLE XII. RESTRICTIONS ON ALIENATION OF BENEFITS		17
ARTICLE XIII. ADMINISTRATION OF THE PLAN		18
ARTICLE XIV. ADOPTION OF PLAN BY SUBSIDIARY, AFFILIATED OR ASSOCIATED COMPANIES		19
ARTICLE XV. EXCESS RETIREMENT BENEFIT PAYMENTS COMMENCED BEFORE SEPTEMBER 1, 1998		20
ARTICLE XVI. MISCELLANEOUS		20
EXHIBIT A		22
EXHIBIT B		24
APPENDIX I CHANGE OF BENEFICIARY FORM FOR ONE GAS, INC. PRE-2005 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN		25
CONSENT OF SPOUSE		26

- i -

ONE GAS, INC. PRE-2005 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

ESTABLISHMENT AND PURPOSE

On November 13, 2013, in anticipation of the Separation that is proposed to occur in 2014, the Board of Directors of ONEOK approved the (1) the establishment, effective January 1, 2014, of a supplemental executive retirement plan that is substantially similar to the ONEOK Frozen SERP for the benefit of ONE Gas Employees and Former ONE Gas Employees; (2) the exclusion of ONE Gas Employees and Former ONE Gas Employees from participating in the ONEOK Frozen SERP for periods after December 31, 2013; and (3) the transfer of liabilities for ONE Gas Employees and Former ONE Gas Employees who are participants in the ONEOK Frozen SERP to this Plan effective January 1, 2014.

By unanimous consent, the Board of Directors of ONE Gas has approved the adoption of this Plan, effective January 1, 2014, for the benefit of certain ONE Gas Employees and Former ONE Gas Employees who were members of a select group of management or highly compensated employees of any member of the ONEOK Group as of December 31, 2004. The Plan is established to receive liabilities transferred from the ONEOK Frozen SERP. The purpose of the Plan is to provide the specified benefits to ONE Gas Employees and Former ONE Gas Employees who were participants in the ONEOK Frozen SERP.

Effective January 1, 2014, all liabilities attributable to ONE Gas Employees and Former ONE Gas Employees under the ONEOK Frozen SERP are transferred and accepted by this Plan. For periods after December 31, 2013, (1) ONE Gas Employees and Former One Gas Employees shall not be eligible to participate in the ONEOK Frozen SERP; (2) the ONEOK Frozen SERP and any successors thereto shall have no further obligation or liability to any ONE Gas Employee or Former ONE Gas Employee with respect to any benefit, amount or right accrued under the ONEOK Frozen SERP; and (3) this Plan is liable for the payment of any benefits accrued by ONE Gas Employees and Former ONE Gas Employees under the ONEOK Frozen SERP. No individual is entitled to a benefit under both this Plan and the ONEOK Frozen SERP.

The terms and conditions of this Plan are substantially the same as the terms and conditions of the ONEOK Frozen SERP. Exhibit A to the Plan sets forth additional rules applicable to Transferred Participants. Notwithstanding anything to the contrary in the Plan, no person other than Transferred Participants shall be eligible to participate in the Plan.

This Plan is separate from the ONE Gas SERP, which ONE Gas established to receive liabilities transferred from the ONEOK 2005 SERP in connection with the Separation. No individual is entitled to a benefit under both this Plan and the ONE Gas SERP.

This Plan and the particular benefits provided to individuals hereunder shall be administered as an unfunded nonqualified deferred compensation and excess benefit plan. The Plan, and benefits hereunder, are intended to be excepted from the requirements of Section 409A of the Code as a “grandfathered plan” because the Plan benefits were earned and vested prior to January 1, 2005. Specifically, the ONEOK Frozen SERP was frozen to new participants and new accruals after December 31, 2004. Accordingly, no additional benefits were accrued by the Transferred Participants under the ONEOK Frozen SERP after December 31, 2004, and no additional benefits will be accrued under this Plan by any such Transferred Participants.

The Plan is effective January 1, 2014.

The capitalized words and terms in this Plan document shall have the meaning given in the definitions stated in Article I of the Plan, unless otherwise expressly indicated.

ARTICLE I.

DEFINITIONS AND CONSTRUCTION

1.1 Definitions. For purposes of the Plan, the following phrases or terms shall have the indicated meanings unless otherwise clearly apparent from the context:

A. “Base Cash Compensation” shall mean the regular monthly salary paid to a Participant by ONEOK before any deductions or exclusions for taxes or other purposes, and excluding any vehicle allowance, incentives, commissions and any other special pay.

B. “Beneficiary” shall mean the individual or individuals, or any trust or trusts, or the estate of a Participant entitled to receive any benefits under a Plan Agreement entered into in accordance with the terms of the Plan.

C. “Board of Directors” shall mean the Board of Directors of ONE Gas, Inc., unless otherwise indicated or the context otherwise requires.

D. “Change in Control” shall mean the occurrence of any of the following:

(1) An acquisition (other than directly from the Company) of any voting securities of the Company (the “Voting Securities”) by any “Person” (as the term person is used for purposes of Section 13(d) or 14(d) of the Exchange Act), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities; provided, however, in determining whether a Change in Control has occurred pursuant to this Section 1.1(D), Shares or Voting Securities which are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not constitute an acquisition which would cause a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any company or other Person of which a majority of its voting power or its voting equity securities or equity interest is owned or controlled, directly or indirectly, by the Company (for purposes of this definition, a “Related Entity”), (ii)

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the Company or any Related Entity, or (iii) any Person in connection with a “Non-Control Transaction” (as hereinafter defined);

(2) The individuals who, as of January 1, 2014, are members of the Board of Directors (the “Incumbent Board”), cease for any reason to constitute at least a majority of the members of the Board of Directors; or, following a Merger which results in a Parent Company, the board of directors of the ultimate Parent Company; provided, however, that if the election, or nomination for election by the Company’s common stockholders, of any new director was approved by a vote of at least two-thirds of the Incumbent Board, such new director shall, for purposes of this Plan, be considered as a member of the Incumbent Board; provided further, however, that no individual shall be considered a member of the Incumbent Board if such individual initially assumed office as a result of either an actual or threatened “Election Contest” (as described in Rule 14a-11 promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board of Directors (a “Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest; or

(3) The consummation of:

(i) A merger, consolidation or reorganization with or into the Company or in which securities of the Company are issued (a “Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger where:

(A) the stockholders of the Company, immediately before such Merger, own directly or indirectly immediately following such Merger at least fifty percent (50%) of the combined voting power of the outstanding voting securities of (x) the company resulting from such Merger (the “Surviving Company”) if fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Surviving Company is not Beneficially Owned, directly or indirectly by another Person (a “Parent Company”), or (y) if there is one or more Parent Companies, the ultimate Parent Company;

(B) the individuals who were members of the Incumbent Board immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (x) the Surviving Company, if there is no Parent Company, or (y) if there is one or more Parent Companies, the ultimate Parent Company; and

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(C) no Person other than (1) the Company, (2) any Related Entity, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to such Merger was maintained by the Company or any Related Entity, or (4) any Person who, immediately prior to such Merger had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Voting Securities or Shares, has Beneficial Ownership of thirty percent (30%) or more of the combined voting power of the outstanding voting securities or common stock of (x) the Surviving Company if there is no Parent Company, or (y) if there is one or more Parent Companies, the ultimate Parent Company.

(ii) A complete liquidation or dissolution of the Company; or

(iii) The sale or other disposition of all or substantially all of the assets of the Company to any Person (other than a transfer to a Related Entity or under conditions that would constitute a Non-Control Transaction with the disposition of assets being regarded as a Merger for this purpose or the distribution to the Company’s stockholders of the stock of a Related Entity or any other assets).

Notwithstanding the foregoing:

(I) a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities if: (1) such acquisition occurs as a result of the acquisition of Shares or Voting Securities by the Company which, by reducing the number of Shares or Voting Securities then outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this subparagraph) as a result of the acquisition of Shares or Voting Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Shares or Voting Securities which increases the percentage of the then outstanding Shares or Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur, or (2) (a) within five business days after a Change in Control would have occurred (but for the operation of this subparagraph), or if the Subject Person acquired Beneficial Ownership of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities inadvertently, then after the Subject Person discovers or is notified by the Company

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that such acquisition would have triggered a Change in Control (but for the operation of this subparagraph), the Subject Person notifies the Board of Directors that it did so inadvertently, and (b) within two business days after such notification, the Subject Person divests itself of a sufficient number of Shares or Voting Securities so that the Subject Person is the Beneficial Owner of less than twenty percent (20%) of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities.

(II) A Change in Control shall not occur upon the Separation.

For purposes of the foregoing definition of Change in Control, “Company” shall mean (i) prior to the effective date of the Separation, ONEOK and (ii) on or after the effective date of the Separation, ONE Gas.

E. “Code” shall mean the Internal Revenue Code of 1986, as amended.

F. “Committee” shall mean the Executive Compensation Committee of the Board of Directors or such other Committee appointed to manage and administer the Plan and individual Plan Agreements in accordance with the provisions of Article XIII hereof.

G. “Company” shall mean ONE Gas, Inc., an Oklahoma corporation, or any division or subsidiary thereof except that for purposes of the Change in Control definition above, “Company” shall have the meaning provided therein.

H. “Compensation” shall mean the Base and Short-Term Incentive Cash Compensation from ONEOK paid to or deferred by a Participant during a calendar year.

I. “Death Benefit” shall mean the amount paid to a Participant’s Beneficiary in accordance with the provisions of Article III hereof.

J. “Disability Benefit” shall mean the amount paid to a Participant’s Beneficiary in accordance with the provisions of Section 4.2 hereof.

K. “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

L. “Employee” shall mean any person who is in the regular full-time employment of the Company or any member of the ONE Gas Group or is on authorized leave of absence therefrom, as determined by the personnel

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rules and practices of the Company. The term does not include (1) persons who are retained by the Company solely as consultants or under contract or (2) any employee of any member of the ONEOK Group.

M. “Former ONE Gas Employee” means any individual (or any beneficiary, dependent, or alternate payee of such individual, as the context requires) whose employment with any member of the ONEOK Group was terminated prior to January 1, 2014, if such individual was allocated in connection with the Separation to any member of the ONE Gas Group as of January 1, 2014 by ONEOK in its sole discretion.

N. “Frozen Final Average Earnings” shall mean the highest thirty-six (36) consecutive months average Compensation (or average of all months of Compensation if employed less than thirty-six (36) months) of the last sixty (60) months of Service ending on or before December 31, 2004, as provided in Section 4.1.A.(l).

O. “ONE Gas Employee” means an active employee or an employee on vacation or on approved leave of absence (including sick leave, qualified military service under the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended, and leave under the Family Medical Leave Act, as amended), in either case, of any member of the ONE Gas Group on or after January 1, 2014, and shall include any beneficiary, dependent, or alternate payee of such employee, as the context requires.

P. “ONE Gas” shall mean ONE Gas, Inc., an Oklahoma corporation, or any division or subsidiary thereof.

Q. “ONE Gas Group” means ONE Gas and each subsidiary of ONE Gas as of January 1, 2014 and any ONE Gas subsidiary that is established or acquired after January 1, 2014.

R. “ONE Gas SERP” shall mean the separate ONE Gas, Inc. Supplemental Executive Retirement Plan established by the Company in connection with the Separation.

S. “ONEOK” shall mean ONEOK, Inc., an Oklahoma corporation, or any division or subsidiary thereof.

T. “ONEOK 2005 SERP” shall mean the ONEOK, Inc. 2005 Supplemental Executive Retirement Plan.

U. “ONEOK Frozen SERP” shall mean the ONEOK, Inc. Supplemental Executive Retirement Plan, which was frozen pursuant to the terms thereof effective December 31, 2004.

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V. “ONEOK Group” means (i) prior to January 1, 2014, ONEOK and any of its direct or indirect subsidiaries, and (ii) on and after January 1, 2014, ONEOK and its subsidiaries as of January 1, 2014 (other than any member of the ONE Gas Group) and any ONEOK subsidiary (other than any member of the ONE Gas Group) that is established or acquired after January 1, 2014.

W. “Participant” shall have the same meaning as Transferred Participant.

X. “Plan Agreement” shall mean a written agreement which was entered into by and between ONEOK and a Participant pursuant to the terms of the ONEOK Frozen SERP, which shall apply to the same effect under this Plan as if entered into by and between the Company and the Participant.

Y. “Plan” shall mean the ONE Gas, Inc. Pre-2005 Supplemental Executive Retirement Plan as embodied herein and as amended from time to time.

Z. “Rabbi Trust” shall mean the trust created to hold assets which will be used to pay the benefits provided hereunder, as provided in Section 7.4 hereof.

AA. “Retirement” and “Retire” shall mean (i) prior to the effective date of the Separation, termination of employment with all members of the ONE Gas Group and the OKE Group, other than as the result of death or Total and Permanent Disability; and (ii) after the effective date of the Separation, termination of employment with all members of the ONE Gas Group, other than as the result of death or Total and Permanent Disability.

BB. “Retirement Age” shall mean the retirement age of a Participant specified in the Participant’s Plan Agreement and the Plan.

CC. “Retirement Benefit” shall mean the monthly amount to be paid to a Participant under Sections 4.1, 4.2, or 4.3 hereof, and the Participant’s Plan Agreement.

DD. “Retirement Plan” shall mean the ONE Gas, Inc. Retirement Plan.

EE. “Retirement Plan Benefit” shall mean the benefit or benefits to which a Participant is entitled under the Retirement Plan.

FF. “Separation” means the separation of ONEOK’s local natural gas distribution business into an independent, publicly traded entity to be known as ONE Gas.

GG. “Service” shall mean employment of a Participant by the Company as a regular full-time employee.

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HH. “Short-Term Incentive Cash Compensation” shall mean any payment by ONEOK under the Key Employee Incentive Plan for Employees of ONEOK, Inc. and Subsidiaries or any other incentive or commission plan established by ONEOK to pay employees additional cash compensation to reward performance. Provided, that any payment or distribution made to any Participant pursuant to the ONEOK Energy Marketing & Trading Group Bonus Plan shall be excluded from, and not be considered as Short-Term Incentive Cash Compensation nor otherwise as part of the Compensation of a Participant under and for purposes of this Plan.

II. “Totally and Permanently Disabled” means when, on the basis of medical evidence, it is determined that a Participant:

(a) is totally disabled so as to be prevented from any comparable employment with the Company, including a disability resulting from an occupational cause; and

(b) will be disabled permanently.

JJ. “Transferred Participant” shall mean a ONE Gas Employee or Former ONE Gas Employee who was a participant in the ONEOK Frozen SERP immediately before January 1, 2014.

KK. “Years of Service” shall include each full year, but not any portion of a year, during which the Participant has been employed by the Company or any division or subsidiary thereof.

1.2 Construction. The singular when used herein may include the plural unless the context clearly indicates to the contrary. The words “hereof”, “herein”, “hereunder”, and other similar compounds of the word “here” shall mean and refer to the entire Plan and not to any particular provision or section. Whenever the words “Article” or “Section” are used in the Plan, or a cross reference to an “Article” or “Section” is made, the Article or Section referred to shall be an Article or Section of the Plan unless otherwise specified.

The Plan is intended to be an unfunded deferred compensation and excess benefit plan established and maintained for a select group of management and highly compensated employees of the Company within the meaning of Sections 201(2) and (7), 301(a)(3), (9) and 401(a)(1) of ERISA, and shall be construed, interpreted and administered in accordance with such intended purpose.

ARTICLE II.

ELIGIBILITY AND PLAN AGREEMENTS

2.1 Eligibility. No person other than a Transferred Participant shall participate in the Plan or be entitled to rights and benefits provided under the terms of the Plan. Schedule B sets forth the Transferred Participants as of the effective date of the Plan.

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2.2 Plan Agreements. The Plan Agreement shall state and provide certain specific terms and provisions that govern the benefits and rights of such Participant from participation in the Plan. Except as otherwise expressly provided in this Plan document or in the Plan Agreement of a Participant, the specific terms and provisions of a Participant’s Plan Agreement shall take precedence and shall control as to the amount and form of benefits such Participant is to receive under the Plan and such Plan Agreement. The Plan Agreement of each Participant shall be a part of the Plan as to such Participant for all purposes. A Participant shall not derive any right or entitlement, directly or indirectly, from the existence of, or provisions in the Plan Agreement of any other Participant in the Plan.

ARTICLE III.

DEATH BENEFIT

3.1 Amount and Payment of Death Benefit. In the event a Participant dies prior to Retirement from the Company, the Company will pay or cause to be paid a Death Benefit to such Participant’s Beneficiary in the amount or amounts set forth in such Participant’s Plan Agreement and as therein specified, commencing on the first day of the month following the date of such Participant’s death, or as otherwise specified in such Participant’s Plan Agreement.

3.2 Partial Distribution Prior to Death. If a Participant shall die after becoming entitled to a Retirement Benefit, but before the total amount payable to such Participant as a Retirement Benefit has been paid, the Retirement Benefit payments then remaining unpaid to such Participant shall be paid to such Participant’s Beneficiary, in accordance with the payment schedule pursuant to which payments are made under the Participant’s Plan Agreement as provided in Sections 4.1, 4.2, or 4.3 hereof.

ARTICLE IV.

RETIREMENT BENEFIT

4.1 Retirement. Subject to Sections 4.1.C. and 4.6, below, if a Participant remains an Employee until attaining the Retirement Age stated in such Participant’s Plan Agreement and shall then retire, the Company shall pay or cause to be paid to such Participant as a Retirement Benefit, the amount or amounts, and at such time or times as is specified in the Participant’s Plan Agreement.

If a Participant’s Plan Agreement does not state or specify a different amount, form and time of payment of a Participant’s Retirement Benefit, then the Participant shall be entitled to receive a Retirement Benefit in accordance with Section 4.1.A and Section 4.1.B, below.

A. (1) Retirement Benefit. Subject to subparagraph A.(2), below, and the vesting schedule applicable under Section 4.3 and Section 4.6, below, a monthly amount which, when combined with existing pension benefits payable to the Participant under the Retirement Plan and any retirement plans (other than 401(k) plans) of any of the Participant’s former

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employers, will provide the percentage of the highest thirty-six (36) consecutive months average Compensation (or average of all months of Compensation if employed less than thirty-six (36) months) of the last sixty (60) months of Service ending on or before December 31, 2004 (“Frozen Final Average Earnings”), for life (15 years minimum) as illustrated below.

Retirement Age	Retirement Benefit Percentage
50 & under		50.00	%
51		51.20	%
52		52.40	%
53		53.60	%
54		54.80	%
55		56.00	%
56		56.57	%
57		57.14	%
58		57.71	%
59		58.28	%
60		58.85	%
61		59.42	%
62		60.00	%
63		60.56	%
64		61.13	%
65 & over		61.70	%

The Retirement Benefit payment shall commence on the first day of the month following the Participant’s Retirement. Provided, however, Retirement Benefit payments shall not commence until the later of (i) the Participant attaining the age of fifty (50), and (ii) the commencement of retirement benefit payments to the Participant under the Retirement Plan.

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(2) Adjustment of Retirement Benefit Payments; Early Commencement. The amount of a Participant’s Retirement Benefit payments will be reduced by reason of early retirement and commencement of payment thereof, based on the following table depending upon the Participant’s age when Retirement Benefit payments to the Participant commence:

Age At Commencement of Retirement Benefit Payments	Payout Percentage Factor Of Retirement Benefit Percentage
50		50	%
51		55	%
52		60	%
53		65	%
54		70	%
55		75	%
56		80	%
57		85	%
58		90	%
59		95	%
60 & older		100	%

B. Code Sections 401(a)(17) and 415(b) Limitations. Notwithstanding Section 4.1.A., above, the Plan shall provide an excess Retirement Benefit attributable to a Participant’s annual eligible compensation under the Retirement Plan that is an amount equal to the difference between (i) the Retirement Plan Benefit to which the Participant would be entitled under the Retirement Plan if such Retirement Plan Benefit was computed without the restrictions and limitations imposed by Section 401(a)(17) and 415(b) of the Code as now or hereafter in effect, and (ii) the amount of the Retirement Plan Benefit payable to the Participant under the Retirement Plan. This part of the Retirement Benefit will be computed by applying the same benefit formula, vesting provisions, and early retirement provisions as are in and applied pursuant to the Retirement Plan. Any part of the Retirement Benefit provided under this Section 4.1.B. will offset and reduce that part of the Retirement Benefit provided under Section 4.1.A., above. Provided, that if a Participant in this Plan is entitled to an Excess Retirement Benefit under the ONE Gas SERP at his/her Retirement, then the Excess Retirement Benefit under the ONE Gas SERP shall be paid to such Participant in accordance with the provisions of Part A of the ONE Gas SERP and in lieu of the part of his/her Retirement Benefit provided for under this Section 4.1.B, and such Excess Retirement Benefit under the ONE Gas SERP will offset and reduce that part of the Retirement Benefit provided in Section 4.1.A., above.

C. Retirement Benefit. The amount of the Retirement Plan Benefit of a Participant taken into account under Section 4.1.A. and Section 4.1.B. shall be the amount of such Retirement Benefit at the time of commencement of payment of the Retirement Plan Benefit to such Participant under this Plan, notwithstanding that such Retirement Plan Benefit is finally determined after December 31, 2004, and that Frozen Final Average Earnings, and frozen vesting under Section 4.3., are applied to such Retirement Benefit, as herein provided.

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4.2 Disability. If a Participant shall become Totally and Permanently Disabled prior to Retirement and such total disability continues for more than six (6) months, such Participant shall be entitled to receive a Disability Benefit in the amount set forth in the Participant’s Plan Agreement.

4.3 Vesting of Retirement Benefit. A Participant’s Retirement Benefit shall unconditionally vest in such Participant and become nonforfeitable according to the vesting schedule stated in the Participant’s Plan Agreement. Notwithstanding anything to the contrary expressed or implied in the Plan, or in a Participant’s Plan Agreement that states the terms governing vesting and nonforfeitability of such Participant’s Retirement Benefit under the Plan, no Service or Years of Service of the Participant with ONEOK or the Company after December 31, 2004, shall be considered or used in determining the vesting and nonforfeitability of such Participant’s Retirement Benefit under the Plan. If a Participant’s Plan Agreement does not state or specify the terms governing vesting and nonforfeitability of such Participant’s Retirement Benefit, then the Participant’s Retirement Benefit shall vest and become nonforfeitable as follows:

Years of Service with the Company	Vested Percentage of Retirement Benefit
0 to 5		0	%
6		10	%
7		20	%
8		30	%
9		40	%
10		50	%
11		60	%
12		70	%
13		80	%
14		90	%
15 or more		100	%

If a Participant attains age sixty-five (65) prior to his/her Retirement, and prior to January 1, 2005, then such Participant shall be 100% vested regardless of the above schedule. A Participant first attaining age sixty-five (65) after December 31, 2004, shall not result in 100% vesting nor otherwise change the vesting and nonforfeitability of the Participant’s Retirement Benefit under the Plan. Retirement Benefits hereunder offsetting the limitations of Internal Revenue Code Sections 401(a)(17) and 415(b) shall be immediately fully vested for all purposes.

4.4 Forfeitability of Retirement Benefit. Notwithstanding any provision to the contrary expressed or implied herein, a Participant’s right to receive a Retirement Benefit under the Plan and such Participant’s Plan Agreement shall be forfeitable to the extent that such Retirement Benefit has not vested as described in Section 4.3 and the Participant’s Plan Agreement.

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4.5 Retirement Benefit Payment Election. In lieu of payment of the Retirement Benefit to a Participant as otherwise provided herein and in the Participant’s Plan Agreement, a Participant may make a written request to the Company prior to the time for commencement of payment of such Retirement Benefit by the Company to receive payment of the present value of such Participant’s Retirement Benefit in a single lump sum amount, less six percent (6%) of the amount thereof as a substantial penalty, which penalty will be forfeited by the Participant. The Company may, in its sole discretion, grant or deny such request. If such request is granted the payment of such lump sum amount shall be made by the Company, and thereafter the Company shall have no further obligation to the Participant. The present value of a Participant’s Retirement Benefit shall be determined in accordance in the manner prescribed under the provisions at Section 417(e)(3) of the Code and Treasury regulations thereunder with respect to benefits payable under a qualified pension or profit sharing plan. A beneficiary of a deceased Participant, or a duly appointed guardian of an incompetent or incapacitated Participant may also request payment of the Participant’s Retirement Benefit in a lump sum under this Section 4.5.

4.6 ONE Gas SERP Part B Supplemental Retirement Benefit Offset; Waiver and Forfeiture of Plan Retirement Benefit. Notwithstanding anything to the contrary expressed or implied in the Plan or in any Plan Agreement, if a Participant in the Plan elected to receive and/or by reason of his/her election does receive any part or payment of a Supplemental Retirement Benefit to which he/she is entitled under Part B of the ONE Gas SERP, then that Supplemental Retirement Benefit shall be paid in lieu of the Participant’s Retirement Benefit under Section 4.1.A. of this Plan; and the Participant shall, by such election, be deemed to voluntarily and completely waive, disclaim and forfeit all his/her right and entitlement to receive, and he/she shall not receive, any amount or payment of that part of his/her Retirement Benefit under Section 4.1.A of this Plan.

ARTICLE V.

BENEFICIARY

A Participant shall designate a Beneficiary to receive benefits under the Plan and the Participant’s Plan Agreement by completing the appropriate space in such Plan Agreement. If more than one Beneficiary is named, the shares and/or precedence of each Beneficiary shall be indicated. As a condition to any married Participant designating a Beneficiary other than such Participant’s spouse, the Committee may require the spouse’s consent. A Participant shall have the right to change the Beneficiary by submitting to the Committee a Change of Beneficiary in the form attached as Appendix I hereof; provided, however, that no change of Beneficiary shall be effective until acknowledged in writing by the Committee. If the Company has any doubt as to the proper Beneficiary to receive payments hereunder, the Company shall have the right to withhold such payments until the matter is finally adjudicated. Any payment made or caused to be made by the Company in good faith and in accordance with the provisions of the Plan and a Participant’s Plan Agreement shall fully discharge the Company from all further obligations with respect to such payment.

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ARTICLE VI.

LEAVE OF ABSENCE

If a Participant is authorized by the Company for any reason, including military, medical, or other, to take a leave of absence from employment, such Participant’s Plan Agreement shall remain in effect.

ARTICLE VII.

SOURCE OF BENEFITS

7.1 Benefits Payable. Retirement Benefits and any other amounts payable hereunder shall be paid exclusively from the general assets of the Company or the Rabbi Trust to be established pursuant to Section 7.4; provided, that no person entitled to payment hereunder shall have any claim, right, security interest, or other interest in any fund, trust, account, insurance contract, or asset of the Company which may be looked to for such payment. The Company’s liability for the payment of benefits hereunder shall be evidenced only by the Plan and each Plan Agreement.

7.2 Investments to Facilitate Payment of Benefits. Although the Company is not obligated to invest in any specific asset or fund, or purchase any insurance contract, in order to provide the means for the payment of any Retirement Benefits under the Plan, the Company may elect to do so, and, in such event, no Participant shall have any interest whatever in such asset, fund, or insurance contract. In the event the Company elects to purchase or causes to be purchased insurance contracts on the life of a Participant as a means for making, offsetting, or contributing to any payment, in full or in part, which may become due and payable by the Company under the Plan or a Participant’s Plan Agreement, such Participant agrees to cooperate in the securing of life insurance on such Participant’s life by furnishing such information as the Company and the insurance carrier may require, including the results and reports of previous Company and other insurance carrier physical examinations as may be requested, and taking any other action which may be requested by the Company and the insurance carrier to obtain such insurance coverage. If a Participant does not cooperate in the securing of such life insurance, the Company shall have no further obligation to such Participant under the Plan, and such Participant’s Plan Agreement shall terminate.

7.3 Ownership of Insurance Contracts. The Company shall be the sole owner of any insurance contracts acquired on the life of a Participant with all incidents of ownership therein, including, but not limited to, the right to cash and loan values, dividends, if any, death benefits, and the right to termination thereof, and a Participant shall have no interest whatsoever in such contracts, if any, and shall exercise none of the incidents of ownership thereof. Provided, however, the Company may assign any such insurance contracts to the trustee of the Rabbi Trust.

7.4 Trust for Payment of Retirement Benefits. The Company shall create a Rabbi Trust for the purpose of facilitating any retirement benefits payable hereunder. Such trust will be funded to provide the applicable vested Retirement Benefits payable under the Plan and Plan Agreements upon the occurrence of any of the following events:

(a) At the Retirement of, and commencement of payment of Retirement Benefits to a Plan Participant;

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(b) Upon a decision by the Committee, or by the Board of Directors; or

(c) Upon a Change in Control.

Such funding may be in the form of single premium annuities, or an amount sufficient for the trustee to purchase single premium annuities, or life insurance policies or contracts insuring the lives of Plan Participants, from qualified and financially sound insurance companies, and such other forms or types of investments the Company may select from time to time to provide the applicable vested Retirement Benefits payable under the Plan and Plan Agreements. Such funding and the purchase of insurance, if any, will not relieve the Company of its obligations to pay or cause to be paid the benefits hereunder.

The Rabbi Trust may be maintained and administered to also provide for the funding of payment of amounts payable to participants in other deferred compensation and benefit plans of the Company. The funding, investments and administration of the Rabbi Trust in connection with such other separate plan or plans shall be separately administered and accounted for as determined to be necessary and appropriate by the Company and trustee pursuant to the terms of the Rabbi Trust. It shall be permissible for the trustee to invest funds of the Rabbi Trust in one or more forms of investment that is common to plans being funded thereunder.

The Rabbi Trust shall be a grantor trust of which the Company is the grantor within the meaning of the Code. The principal of the Rabbi Trust and any earnings thereon shall be held separate and apart from other funds of the Company and shall be used exclusively for the uses and purposes of Participants in the Plan and general creditors of the Company as specified hereinbelow and in the trust instrument. Participants in the Plan and their Beneficiaries shall have no preferred claim on, or any beneficial ownership in any assets of the Rabbi Trust; and any rights created under the Plan or Participant Plan Agreements, and the Rabbi Trust are to be made unsecured contractual rights of Participants and their Beneficiaries against the Company; and assets held by the Rabbi Trust will be subject to the claims of the Company’s general creditors under federal and state law in the event of insolvency of the Company.

ARTICLE VIII.

TERMINATION OF EMPLOYMENT

Neither the Plan nor a Participant’s Plan Agreement, either singly or collectively, in any way obligate the Company, or any subsidiary of the Company, to continue the employment of a Participant with the Company, or any subsidiary of the Company, nor does either limit the right of the Company or any subsidiary of the Company at any time and for any reason to terminate the Participant’s employment. Termination of a Participant’s employment with the Company, or any subsidiary of the Company, for any reason, whether by action of the Company, subsidiary, or Participant, shall immediately terminate the Participant’s participation in the Plan and such Participant’s Plan Agreement, and all further obligations of either party thereunder, except as

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may be provided in Article X and the Participant’s Plan Agreement. In no event shall the Plan or a Plan Agreement, either singly or collectively, by their terms or implications constitute an employment contract of any nature whatsoever between the Company, or any subsidiary, and a Participant.

ARTICLE IX.

TERMINATION OF PARTICIPATION

A Participant reserves the right to terminate participation in the Plan and such Participant’s Plan Agreement at any time by giving the Company written notice of such termination not less than 30 days (i) prior to the anniversary date of any contract or contracts of insurance on the life of such Participant which may be in force and utilized by the Company in connection with the Plan, or (ii) prior to the date a Participant selects for termination if no insurance contract is in effect.

ARTICLE X.

TERMINATION, AMENDMENT, MODIFICATION,

OR SUPPLEMENT OF THE PLAN

10.1 Amendment or Termination. Subject to Sections 10.2 and 10.3, below, the Company reserves the right to amend, modify, supplement, or terminate the Plan, wholly or partially, from time to time, and at any time. The Company likewise reserves the right to amend, modify, or supplement any Plan Agreement, wholly or partially, from time to time. Such right to amend, modify, supplement, or terminate the Plan or any Plan Agreement, as the case may be, shall be exercised for the Company by the Board of Directors; provided, that the Committee shall also be authorized to amend or modify the terms and provisions of the Plan, or a Plan Agreement thereunder, except that any amendment or modification of the Plan or a Plan Agreement that changes the amount of any payment or benefit to a Participant that is provided for under the Plan or Plan Agreement shall be made only with the approval and by action of the Board of Directors; provided further in the event of a Change in Control of the Company, for a period of two (2) years after the date of such Change of Control the surviving corporation may terminate or amend the Plan only by substitution by such corporation of another plan or program, or by amendments to the Plan, which provide benefits no less favorable to the Participants of this Plan; and upon the expiration of such two (2) year period such surviving corporation may thereafter terminate or amend the Plan or any such substituted plan subject in any case to Section 10.2, below.

10.2 Rights and Obligations Upon Amendment, Termination. The following terms and conditions shall govern the rights and obligations of a Participant and the Company (including any surviving corporation in event of a Change of Control), respectively, with respect to the amendment or termination of the Plan.

A. Notwithstanding anything to the contrary expressed or provided in the Plan or any Plan Agreement of a Participant, no amendment, modification or termination of the Plan, shall decrease a Participant’s accrued Retirement Benefit. For purposes of this Paragraph A., a Plan amendment

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which has the effect of decreasing a Participant’s accrued Retirement Benefit or eliminating an optional form of payment of a Participant’s accrued Retirement Benefit, with respect to benefits attributable to service before the amendment shall be treated as reducing an accrued Retirement Benefit. If a vesting schedule under the Plan or any Plan Agreement is amended, the Participant’s non-forfeitable percentage, determined as of the later of the date such amendment is adopted or the date it becomes effective, will not be less than the percentage computed under the Plan and Plan Agreement without regard to such amendment.

B. Except as provided in paragraph A of this Section 10.2, upon the termination of the Plan by the Board of Directors, or a termination of the Plan Agreement of a Participant, in accordance with the provisions for such termination, neither the Plan nor the Plan Agreement shall be of any further force or effect, and no party shall have any further obligation under either the Plan or any Plan Agreement so terminated, except as provided in the Plan or Plan Agreement with respect to accrued benefits at the time of such termination or as elsewhere provided in the Plan.

C. For purposes of paragraphs A and B of this Section 10.2, the term “Plan” shall also mean and include any substituted plan that may be established in event of a Change of Control as described in Section 10.1, above, and the term “Retirement Benefit” shall also mean and include any benefit provided for under such a substituted plan.

ARTICLE XI.

TREATMENT OF BENEFITS

Retirement Benefits under the Plan and Plan Agreements entered into hereunder shall not be considered compensation for the purpose of computing contributions or benefits under any plan maintained by the Company, or any of its subsidiaries, which is qualified under Section 401(a) of the Code.

ARTICLE XII.

RESTRICTIONS ON ALIENATION OF BENEFITS

No Retirement Benefit, or other right or benefit under the Plan or a Plan Agreement shall be subject to anticipation, alienation, sale, assignment, pledge, encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge the same shall be void. No Retirement Benefit, or right or benefit under the Plan or under any Plan Agreement shall in any manner be liable for or subject to the debts, contracts, liabilities, or torts of the person entitled to such thereto. If any Participant or Beneficiary under the Plan or a Plan Agreement should become bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge any right to a benefit under the Plan or under any Plan Agreement, then such right or benefit shall, in the discretion of the Committee, cease, and in such event, the Committee may hold or apply the same or any part thereof for the benefit of such Participant or Beneficiary, his or her spouse, children, or other dependents, or any of them, in such portion as the Committee, in its sole and absolute discretion, may deem proper.

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ARTICLE XIII.

ADMINISTRATION OF THE PLAN

13.1 Appointment of Committee. The general administration of the Plan, and any Plan Agreements executed hereunder, as well as construction and interpretation thereof, shall be vested in the Committee, the number and members of which shall be designated and appointed from time to time by, and shall serve at the pleasure of, the Board of Directors. Any such member of the Committee may resign by notice in writing filed with the Board of Directors. Vacancies shall be filled promptly by the Board of Directors. The Committee may, at its discretion, delegate discretionary authority for day-to-day administration of the Plan to the Company’s Benefit Plan Administration Committee or its authorized representatives pursuant to a duly adopted resolution or a memorandum of action signed by all members of the Committee or approved via electronic transmission. All actions taken by the Company’s Benefit Plan Administration Committee or its authorized representative shall have the same legal effect and shall be entitled to the same deference as if taken by the Committee itself.

13.2 Committee Officials. The Board of Directors may designate one of the members of the Committee as Chairman and may appoint a secretary who need not be a member of the Committee. The secretary shall keep minutes of the Committee’s proceedings and all data, records, and documents relating to the Committee’s administration of the Plan and any Plan Agreements executed hereunder. The Committee may appoint from its number such subcommittees with such powers as the Committee shall determine and may authorize one or more of its members or any agent to execute or deliver any instrument or make any payment on behalf of the Committee.

13.3 Committee Action. All resolutions or other actions taken by the Committee shall be by the vote of a majority of those present at a meeting at which a majority of the members are present, or in writing by all the members at the time in office if they act without a meeting.

13.4 Committee Rules and Powers - General. Subject to the provisions of the Plan, the Committee may from time to time establish rules, forms, and procedures for the administration of the Plan, including Plan Agreements. Except as herein otherwise expressly provided, the Committee shall have the exclusive right to interpret the Plan and any Plan Agreements, and to decide any and all matters arising thereunder or in connection with the administration of the Plan and any Plan Agreements, and it shall endeavor to act, whether by general rules or by particular decisions, so as not to discriminate in favor of or against any person. The Committee shall have the exclusive right to determine if a Participant has become Totally and Permanently Disabled with respect to a Participant (consistent with the Plan’s definition of the term), such determinations to be made on the basis of such medical and/or other evidence that the Committee, in its sole and absolute discretion, may require. Such decisions, actions, and records of the Committee shall be conclusive and binding upon the Company, the Participants, and all persons having or claiming to have rights or interests in or under the Plan.

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13.5 Reliance on Certificates, etc. The members of the Committee and the Officers and Directors of the Company shall be entitled to rely on all certificates and reports made by any duly appointed accountants, and on all opinions given by any duly appointed legal counsel. Such legal counsel may be counsel for the Company.

13.6 Liability of Committee. No member of the Committee shall be liable for any act or omission of any other member of the Committee, or for any act or omission on his part, excepting only his own willful misconduct. The Company shall indemnify and save harmless each member of the Committee against any and all expenses and liabilities arising out of membership on the Committee, excepting only expenses and liabilities arising out of a Committee member’s own willful misconduct. Expenses against which a member of the Committee shall be indemnified hereunder shall include, without limitation, the amount of any settlement or judgment, costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted, or a proceeding brought, or settlement thereof. The foregoing right of indemnification shall be in addition to any other rights to which any such member may be entitled.

13.7 Determination of Benefits. In addition to the powers hereinabove specified, the Committee shall have the power to compute and certify, under the Plan and any Plan Agreement, the amount and kind of benefits from time to time payable to Participants and their Beneficiaries, and to authorize all disbursements for such purposes.

13.8 Information to Committee. To enable the Committee to perform its functions, the Company shall supply full and timely information to the Committee on all matters relating to the compensation of all Participants, their retirement, death, or other cause for termination of employment, and such other pertinent facts as the Committee may require.

13.9 Manner and Time of Payment of Benefits. The Company shall have the power, in its sole and absolute discretion, to change the manner and time of payment of future Retirement Benefits to be made to a Participant or the Participant’s Beneficiary from that set forth in the Participant’s Plan Agreement, if requested to do so by such Participant or Beneficiary. Any request by a Participant for such a change must be made by the Participant in writing more than thirty (30) days in advance of the time such Retirement Benefits would otherwise be paid, unless the Company, in its discretion, allows such a request at a later date that also precedes the existing time of payment which is the subject of the request.

ARTICLE XIV.

ADOPTION OF PLAN BY SUBSIDIARY,

AFFILIATED OR ASSOCIATED COMPANIES

Any corporation which is a subsidiary of the Company may, with the approval of the Board of Directors, adopt the Plan and thereby come within the definition of Company in Article I hereof.

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ARTICLE XV.

EXCESS RETIREMENT BENEFIT PAYMENTS

COMMENCED BEFORE SEPTEMBER 1, 1998

Notwithstanding anything expressed or implied to the contrary herein, the payment of excess retirement benefits to a retired Plan Participant that commenced under the ONEOK Frozen SERP prior to September 1, 1998, shall be paid in accordance with, and to the extent provided by, the applicable terms and provisions of the ONEOK Frozen SERP in effect prior to September 1, 1998.

ARTICLE XVI.

MISCELLANEOUS

16.1 Execution of Receipts and Releases. Any payment to a Participant, a Participant’s legal representative, or Beneficiary in accordance with the provisions of the Plan or any Plan Agreement executed hereunder shall, to the extent thereof, be in full satisfaction of all claims hereunder against the Company. The Company may require such Participant, legal representative, or Beneficiary, as a condition precedent to such payment, to execute a receipt and release therefor in such form as it may determine.

16.2 No Guarantee of Interests. Neither the Committee nor any of its members guarantees the payment of any amounts which may be or becomes due to any person or entity under the Plan or any Plan Agreement executed hereunder. The liability of the Company to make any payment under the Plan or any Plan Agreement executed hereunder is limited to the then available assets of the Company and the Rabbi Trust established under Section 7.4 hereof.

16.3 Company Records. Records of the Company as to a Participant’s employment, termination of employment and the reason therefor, reemployment, authorized leaves of absence, and compensation shall be conclusive on all persons and entities, unless determined to be incorrect.

16.4 Evidence. Evidence required of anyone under the Plan and any Plan Agreement executed hereunder may be by certificate, affidavit, document, or other information which the person or entity acting on it considers pertinent and reliable, and signed, made, or presented by the proper party or parties.

16.5 Notice. Any notice which shall be or may be given under the Plan or a Plan Agreement executed hereunder shall be in writing and shall be mailed by United States mail, postage prepaid. If notice is to be given to the Company, such notice shall be addressed to the Company at:

15 East 5^th Street

Tulsa, OK 74103

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and marked to the attention of the Secretary, Supplemental Executive Retirement Plan Administrative Committee; or, if notice to a Participant, addressed to the address shown on such Participant’s most recent employment file with the Company.

16.6 Change of Address. Any party may, from time to time, change the address to which notices shall be mailed by giving written notice of such new address.

16.7 Effect of Provisions. The provisions of the Plan and of any Plan Agreement executed hereunder shall be binding upon the Company and its successors and assigns, and upon a Participant, the Participant’s Beneficiary, assigns, heirs, executors, and administrators.

16.8 Headings. The titles and headings of Articles and Sections are included for convenience of reference only and are not to be considered in the construction of the provisions hereof or any Plan Agreement executed hereunder.

16.9 Governing Law. All questions arising with respect to the Plan and any Plan Agreement executed hereunder shall be determined by reference to the laws of the State of Oklahoma in effect at the time of their adopting and execution, respectively.

16.10 Effective Date. The terms of this Plan shall be effective January 1, 2014.

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EX-10.10

Exhibit 10.10

ONE GAS, INC.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Effective January 1, 2014

ONE GAS, INC.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Effective January 1, 2014

Table of Contents

				Page
ESTABLISHMENT AND PURPOSE					1
PART A.		EXCESS RETIREMENT BENEFITS			3
	ARTICLE I.		PURPOSE AND SCOPE OF PART A		4
		1.1	Part A; Excess Retirement Benefits		4
		1.2	Separate Benefits		4
		1.3	Deferral of Compensation		4
	ARTICLE II.		ELIGIBILITY AND PARTICIPATION		4
		2.1	Eligibility		4
		2.2	Scope of Part A Participation		4
		2.3	Election to Defer Compensation		4
	ARTICLE III.		EXCESS RETIREMENT BENEFIT		5
		3.1	Excess Retirement Benefit		5
		3.2	Payment of Excess Retirement Benefit		6
		3.3	Specified Employee		7
		3.4	Vesting of Excess Retirement Benefit		8
		3.5	Form of Payment		8
		3.6	Disability		10
		3.7	Death		10
		3.8	Nonqualified Deferred Compensation Plan Requirements		10
	ARTICLE IV.		BENEFICIARY		10
	ARTICLE V.		LEAVE OF ABSENCE		10
	ARTICLE VI.		ADMINISTRATION OF PART A OF THE PLAN		11
PART B.		SUPPLEMENTAL RETIREMENT BENEFITS			12
	ARTICLE I.		PURPOSE AND SCOPE OF PART B		13
		1.1	Part B, Supplemental Retirement Benefits		13
		1.2	Separate Benefits		13
		1.3	Deferral of Compensation		13
	ARTICLE II.		ELIGIBILITY AND PARTICIPATION		13
		2.1	Eligibility		13
		2.2	Scope of Part B Participation		13
		2.3	Election to Defer Compensation		13

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	ARTICLE III.		SUPPLEMENTAL RETIREMENT BENEFIT	14
		3.1	Supplemental Retirement Benefit	14
		3.2	Payment of Supplemental Retirement Benefit	16
		3.3	Specified Employee	18
		3.4	Vesting of Supplemental Retirement Benefit	19
		3.5	Form of Payment	19
		3.6	Disability	20
		3.7	Death	21
		3.8	Nonqualified Deferred Compensation Plan Requirements	21
	ARTICLE IV.		BENEFICIARY	21
	ARTICLE V.		SUPPLEMENTAL RETIREMENT BENEFIT ADJUSTMENTS	21
	ARTICLE VI.		LEAVE OF ABSENCE	21
	ARTICLE VII.		ADMINISTRATION OF PART B OF THE PLAN	22
PART C.		PLAN ADMINISTRATION AND MISCELLANEOUS PROVISIONS		23
	ARTICLE I.		PURPOSE AND SCOPE OF PART C	24
	ARTICLE II.		DEFINITIONS AND CONSTRUCTION	24
		2.1	Definitions	24
		2.2	Construction	31
		2.3	Plan Purpose	31
	ARTICLE III.		COMMITTEE	32
		3.1	Appointment of Committee	32
		3.2	Committee Officials	32
		3.3	Committee Action	32
		3.4	Committee Rules and Powers	32
		3.5	Reliance on Certificates, etc.	33
		3.6	Liability of Committee	33
		3.7	Determination of Benefits	33
		3.8	Information to Committee	33
	ARTICLE IV.		ADOPTION OF PLAN BY SUBSIDIARY, AFFILIATED OR ASSOCIATED COMPANIES	33
	ARTICLE V.		SOURCE OF BENEFITS	33
		5.1	Benefits Payable	33
		5.2	Investments to Facilitate Payment of Benefits	34
		5.3	Ownership of Insurance Contracts	34
		5.4	Trust for Payment of Benefits	34

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	ARTICLE VI.		TERMINATION OF EMPLOYMENT	35
	ARTICLE VII.		TERMINATION OF PARTICIPATION	36
	ARTICLE VIII.		TERMINATION, AMENDMENT, MODIFICATION, OR SUPPLEMENT OF THE PLAN	36
		8.1	Amendment or Termination	36
		8.2	Rights and Obligations Upon Amendment, Termination	36
	ARTICLE IX.		TREATMENT OF BENEFITS	37
	ARTICLE X.		RESTRICTIONS ON ALIENATION OF BENEFITS	37
	ARTICLE XI.		MISCELLANEOUS	38
		11.1	Deferral of Compensation Requirements	38
		11.2	Execution of Receipts and Releases	39
		11.3	No Guarantee of Interests	39
		11.4	Company Records	39
		11.5	Evidence	39
		11.6	Notice	39
		11.7	Change of Address	40
		11.8	Effect of Provisions	40
		11.9	Headings	40
		11.10	Governing Law	40
		11.11	Effective Date	40
EXHIBIT A				41
EXHIBIT B				43
EXHIBIT C				44

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ONE GAS, INC.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Effective January 1, 2014

ESTABLISHMENT AND PURPOSE

On November 13, 2013, in anticipation of the Separation that is proposed to occur in 2014, the Board of Directors of ONEOK approved the (1) the establishment, effective January 1, 2014, of a supplemental executive retirement plan that is substantially similar to the ONEOK 2005 SERP for the benefit of ONE Gas Employees and Former ONE Gas Employees; (2) the exclusion of ONE Gas Employees and Former ONE Gas Employees from participating in the ONEOK 2005 SERP for periods after December 31, 2013; and (3) the transfer of liabilities for ONE Gas Employees and Former ONE Gas Employees who are participants in the ONEOK 2005 SERP to this Plan effective January 1, 2014.

By unanimous consent, the Board of Directors of ONE Gas has approved the adoption of this Plan, effective January 1, 2014, for the benefit of a select group of management or highly compensated employees. The Plan is established to receive liabilities transferred from the ONEOK 2005 SERP. The purpose of the Plan is to provide the specified benefits to ONE Gas Employees and Former ONE Gas Employees who were participants in the ONEOK 2005 SERP.

Effective January 1, 2014, all liabilities attributable to ONE Gas Employees and Former ONE Gas Employees under the ONEOK 2005 SERP are transferred and accepted by this Plan. For periods after December 31, 2013, (1) ONE Gas Employees and Former One Gas Employees shall not be eligible to participate in the ONEOK 2005 SERP; (2) the ONEOK 2005 SERP and any successors thereto shall have no further obligation or liability to any ONE Gas Employee or Former ONE Gas Employee with respect to any benefit, amount or right accrued under the ONEOK 2005 SERP; and (3) this Plan is liable for the payment of any benefits accrued by ONE Gas Employees and Former ONE Gas Employees under the ONEOK 2005 SERP. No individual is entitled to a benefit under both this Plan and the ONEOK 2005 SERP.

The terms and conditions of this Plan are substantially the same as the terms and conditions of the ONEOK 2005 SERP. Exhibit A to the Plan sets forth additional rules applicable to Transferred Participants. Notwithstanding anything to the contrary in the Plan, no person other than Transferred Participants shall be eligible to participate in the Plan.

This Plan is separate from the ONE Gas Pre-2005 SERP, which ONE Gas established to receive liabilities transferred from the ONEOK Frozen SERP in connection with the Separation. No individual is entitled to a benefit under both this Plan and the ONE Gas Pre-2005 SERP.

This Plan and the particular benefits provided to individuals hereunder shall be administered as an unfunded nonqualified deferred compensation and excess benefit plans established and maintained for a select group of management or highly compensated employees. The Plan is intended to meet all requirements of Section 409A of the Code for compensation deferred under the Plan to not be includible in gross income of the Participant until actually paid or distributed pursuant to the Plan.

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The capitalized words and terms in this Plan document shall have the meaning given in the definitions stated in Part C, Article II of the Plan, unless otherwise expressly indicated.

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PART A. EXCESS RETIREMENT BENEFITS

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ARTICLE I.

PURPOSE AND SCOPE OF PART A

1.1 Part A; Excess Retirement Benefits. The provisions of Part A of the Plan shall establish and provide excess retirement benefits to Part A Participants.

1.2 Separate Benefits. The Excess Retirement Benefits provided to participants under Part A of the Plan are separate and independent from Supplemental Retirement Benefits provided under Part B of the Plan.

1.3 Deferral of Compensation. The Excess Retirement Benefits provided to Participants under Part A of the Plan shall be considered and treated as deferral of compensation to the extent and in the manner provided for in Section 409A of the Code and Treasury Regulations thereunder.

ARTICLE II.

ELIGIBILITY AND PARTICIPATION

2.1 Eligibility. No person other than a Part A Participant shall participate in Part A of the Plan. In no event shall any employee of the ONEOK Group be eligible to participate in the Plan.

2.2 Scope of Part A Participation. A Part A Participant shall not be entitled to participate in Part B of the Plan or to receive benefits thereunder unless the Part A Participant is also a Part B Participant.

2.3 Election to Defer Compensation.

A. Except as provided in Section 2.3.B., of this Article, the Company, pursuant to the Plan, elects, determines and provides for the time and form of payment of an Excess Retirement Benefit to any eligible Employee who is a Part A Participant. The time and form of payment of an Excess Retirement Benefit is stated and provided in Article III of this Part A of the Plan.

B. All Elections made by a Part A Participant under the ONEOK 2005 SERP shall apply to the same effect under this Plan as if made under the terms of this Plan. Any Election of the time and form of payment of an Excess Retirement Benefit of a Part A Participant shall apply with respect to all compensation deferred under the Plan for the Part A Participant.

C. A Part A Participant shall be allowed to change the form of an annuity benefit to the extent provided in Section 3.5 of Article III of this Part A of the Plan. A Part A Participant shall be allowed to make a Subsequent Election as to time of payment of an Excess Retirement Benefit as provided in Section 3.2 of Article III of this Part A of the Plan.

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ARTICLE III.

EXCESS RETIREMENT BENEFIT

3.1 Excess Retirement Benefit.

A. The Company shall pay each Part A Participant the vested Excess Retirement Benefit attributable to a Part A Participant’s annual eligible compensation under the Retirement Plan that is in excess of the limitations on such Part A Participant’s Retirement Plan Benefits contained in Code Sections 401(a)(17) and 415(b).

B. The Excess Retirement Benefit will be calculated by applying the same benefit formula, vesting provisions, and early retirement provisions as are in and apply to the Part A Participant’s Retirement Plan Benefit under the Retirement Plan.

C. The Excess Retirement Benefit shall be calculated for the time of the commencement of payment of it to a Part A Participant (hereinafter referred to as “Excess Retirement Benefit Commencement Date”) pursuant to the terms and provisions of the Plan governing the time and form of payment thereof, irrespective of whether or not a corresponding Retirement Plan Benefit is then being paid or is to commence payment to such Part A Participant at that time, and irrespective of the time and form of payment of the Retirement Plan Benefit that has been elected, is being paid or may be paid to the Part A Participant.

D. The Excess Retirement Benefit shall be calculated and determined for the Excess Retirement Benefit Commencement Date of a Part A Participant as follows:

(1) Calculate as a single (straight) life annuity payable at age sixty-five (65);

(2) Apply early retirement provisions based upon the age of the Part A Participant at the Excess Retirement Benefit Commencement Date;

(3) Apply the factors for the form of payment that has been elected by the Part A Participant in accordance with the terms and provisions of this Plan as an actuarial equivalent of a single (straight) life annuity, if such elected form of payment is other than a single (straight) life annuity in accordance with the Plan and reasonable actuarial assumptions and methods, as determined by the Committee; and

(4) Deduct the Retirement Plan Benefit calculated at the same time and form of payment as the Excess Retirement Benefit, irrespective of the time and form of payment of the Retirement Plan Benefit elected by the Participant for the Retirement Plan.

E. The Committee shall be authorized to take such other actions and apply procedures that it determines, in its discretion, to calculate, determine and commence the payment of an Excess Retirement Benefit to a Part A Participant at the Excess Retirement Benefit Commencement Date.

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3.2 Payment of Excess Retirement Benefit.

A. Subject to the requirements of Section 3.3 below (six-month required delay of payment for Specified Employee), a vested Excess Retirement Benefit shall be paid to a Part A Participant entitled thereto or his/her Beneficiary, commencing on his/her Normal Specified Distribution Date.

B. A Part A Participant shall be allowed to make a Subsequent Election to change the time of distribution and payment of his/her Excess Retirement Benefit from his/her Normal Specified Distribution Date to a Subsequent Election Distribution Date resulting from such election, if:

(i) he/she delivers a written notification of such Subsequent Election to the Committee, or its designee, in the form it prescribes, not less than twelve (12) months prior to his/her Normal Specified Distribution Date, and

(ii) he/she makes a corresponding Subsequent Election with respect to any Supplemental Retirement Benefit he/she is entitled to under Part B of the Plan in such written notification.

C. A Part A Participant shall be allowed to make a Subsequent Election as to any Subsequent Election Distribution Date established for the payment of his/her Excess Retirement Benefit if:

(i) he/she delivers a written notification of such Subsequent Election to the Committee, or its designee, in the form it prescribes, not less than twelve (12) months prior to such Subsequent Election Distribution Date, and

(ii) he/she makes a corresponding Subsequent Election with respect to any Supplemental Retirement Benefit he/she is entitled to under Part B of the Plan in such written notification.

D. Notwithstanding anything otherwise provided in the Plan or in any Election or Subsequent Election of a Part A Participant, any Subsequent Election made by a Part A Participant under the Plan shall result in a Subsequent Election Distribution Date of his/her Excess Retirement Benefit being established for it, and the first distribution and payment with respect to which such Subsequent Election is made being deferred to a Subsequent Election Distribution Date that is not less than five (5) years from the date such distribution and payment would otherwise have been made.

E. Except as otherwise expressly specified in the Plan, a distribution or payment shall be treated as made upon the date specified under the Plan if the payment is

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made at such date or a later date within the same taxable year of the Participant or, if later, by the 15th day of the third calendar month following the date specified under the Plan and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. In addition, a distribution or payment shall be treated as made upon the date specified under the Plan and shall not be treated as an accelerated payment if the payment is made no earlier than thirty (30) days before the designated payment date and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. For purposes of this paragraph, if the date specified is only a designated taxable year of the Participant, or a period of time during such a taxable year, the date specified under the Plan is treated as the first day of such taxable year or the first day of the period of time during such taxable year, as applicable. If calculation of the amount of the distribution or payment is not administratively practicable due to events beyond the control of the Participant (or Participant’s beneficiary), the distribution or payment will be treated as made upon the date specified under the Plan if the distribution or payment is made during the first taxable year of the Participant in which the calculation of the amount of the distribution or payment is administratively practicable. For purposes of this section, the inability of a Corporation to calculate the amount or timing of a distribution or payment due to a failure of a Participant (or Participant’s beneficiary) to provide reasonably available information necessary to make such calculation does not constitute an event beyond the control of the Participant.

3.3 Specified Employee; Six (6) Month Required Delay in Payment. If a Part A Participant is a Specified Employee, his/her vested Excess Retirement Benefit shall not commence being paid until after the end of the Specified Employee Required Deferral Period.

In the case of any Participant who is a Specified Employee as of the date of a Separation from Service, distribution and payments of any Deferred Compensation may not be made before the date that is six (6) months after the date of Separation from Service (or, if earlier than the end of the six-month period, the date of death of the Specified Employee). For this purpose, a Participant who is not a Specified Employee as of the date of a Separation from Service will not be treated as subject to this requirement even if the Participant would have become a Specified Employee if the Participant had continued to provide services through the next Specified Employee Effective Date; and a Participant who is treated as a Specified Employee as of the date of a Separation from Service will be subject to this requirement even if the Participant would not have been treated as a Specified Employee after the next Specified Employee Effective Date had the Specified Employee continued in employment with the Corporation through the next Specified Employee Effective Date. The required delay in payment is met if payments to which a Specified Employee would otherwise be entitled during the first six (6) months following the date of Separation from Service are accumulated and paid on the first day of the seventh month following the date of Separation from Service, or if each payment to which a Specified Employee is otherwise entitled upon a Separation from Service is delayed by six (6) months. The Committee shall have and retain discretion to choose which method will be implemented, provided that no direct or indirect election as to the method may be provided to the Participant. For an affected Specified Employee, a date upon which the Committee or the Corporation designates that the payment will be made after the six-month delay is treated as a fixed payment date for purposes of the other requirements of the Plan once the Separation from Service has occurred.

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In such a case, the Part A Participant shall, to the extent permissible under Code Section 409A, receive a Specified Employee Catch-Up Payment at the end of the Specified Employee Required Deferral Period and thereafter receive vested Excess Retirement Benefit monthly payments in accordance with the Plan. If such a Specified Employee Catch-Up Payment is not permissible under Code Section 409A, the Excess Retirement Benefit shall be paid and distributed to the Specified Employee in accordance with the requirements of Code Section 409A and the regulations thereunder, and the time and form of payment elected shall not otherwise be changed or accelerated.

3.4 Vesting of Excess Retirement Benefit. A Part A Participant’s Excess Retirement Benefit shall unconditionally vest in such Participant and become nonforfeitable upon such Part A Participant’s completion of five (5) Years of Service; provided, that the Excess Retirement Benefit shall not be vested and nonforfeitable upon Retirement if the Part A Participant has not completed five (5) Years of Service.

3.5 Form of Payment.

A. The vested Excess Retirement Benefit shall be paid to a Part A Participant in the form of payment elected by the Part A Participant, subject to the provisions of paragraph B. of this Section 3.5, below, as to a Part A Participant who is Married on or after his/her Initial Participation Date as a Part A Participant in the Plan.

B. The vested Excess Retirement Benefit shall be paid to a Part A Participant who is Married on or after his/her Initial Participation Date as a Part A Participant in the Plan in the form of a 50% qualified joint and survivor annuity (as defined in the Retirement Plan), unless such Part A Participant in writing elects a different form of payment of his/her vested Excess Retirement Benefit which election is delivered to the Committee or its designee, and such Part A Participant’s Spouse consents in writing to such election of a different form of payment, and the Spouse’s consent acknowledges the effect of such election and is witnessed by a Plan representative or notary public, or it is established to the satisfaction of the Committee that the Spouse consent as herein required may not be obtained because there is not a Spouse, because the Spouse cannot be located, or because of a similar circumstances recognized by the Committee in its sole discretion.

C. A Part A Participant who is not Married may elect a form of payment of his/her vested Excess Retirement Benefit and designate a Beneficiary, and change his/her designation of a Beneficiary, without requiring consent by any other person, irrespective of another person having any other particular relationship to the Part A Participant (including a Domestic Partner relationship), or another person previously having been designated as a Beneficiary by the Part A Participant, subject, however, to the authority, powers and discretion of the Committee provided for under the Plan.

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D. The forms of payment of the vested Excess Retirement Benefit under the Plan which may be elected by and paid to a Part A Participant shall be the same forms of payment and benefit as are provided for a vested retirement benefit of a Group C Participant under the Retirement Plan.

E. Subject to the foregoing provisions of this Section 3.5, the forms of payment of a vested Excess Retirement Benefit to a Part A Participant and another individual as a survivor beneficiary, including a Spouse, Domestic Partner, child or other individual, shall be payable to the Part A Participant and the survivor beneficiary who is designated in writing as the survivor beneficiary by the Part A Participant in a written instrument signed by the Part A Participant and delivered to the Committee or its designee in accordance with procedures prescribed by the Committee.

F. In the event a Part A Participant does not effectively make an election of the form of payment of a vested Excess Retirement Benefit or does not effectively designate a survivor beneficiary, if applicable, such vested Excess Retirement Benefit shall be paid in the same form of payment and benefit and to the Part A Participant and to his/her beneficiary as applicable under the Retirement Plan with respect to the Retirement Plan benefit of the Part A Participant. Provided, the time of payment of the Excess Retirement Benefit to a Part A Participant shall be determined pursuant to the terms of this Plan and not pursuant to or under the Retirement Plan.

G. A Part A Participant shall be allowed to change the form of payment of an Excess Retirement Benefit that is initially elected and designated, or any permissible form previously elected by the Part A Participant hereunder, to the extent provided in this Section 3.5. Any such change in the form of payment pursuant to this Section 3.5 shall be allowed only if (1) it is made in writing by the Participant in an instrument prescribed by the Committee prior to the first payment and distribution of an Excess Retirement Benefit, (2) the Committee determines that the previously elected form of payment and the changed form of payment are actuarially equivalent applying reasonable actuarial methods and assumptions, and (3) the Part A Participant complies with such other requirements as the Committee may prescribe.

H. A change in form of payment of an Excess Retirement Benefit shall not change, delay or accelerate the scheduled date for the first annuity payment of an Excess Retirement Benefit under the Plan.

I. Each change in form of payment of an Excess Retirement Benefit pursuant to the foregoing provisions shall be deemed to make a similar change in the form of payment with respect to any Supplemental Retirement Benefit payable to the Participant under the Plan.

J. If the present value of Excess Retirement Benefit payable in an annuity form of payment under the Plan is less than $25,000 determined on an actuarially equivalent basis the Committee shall require that the Excess Retirement Benefit be paid in a single lump sum payment to the Part A Participant, but only if such payment is authorized and allowed to be made under Code section 409A and Treasury Regulations.

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3.6 Disability. If a Part A Participant shall become Disabled prior to Retirement and such total disability continues for more than six (6) months, such Participant shall be entitled to receive an Excess Retirement Benefit. The vested Excess Retirement Benefit of such Part A Participant shall be distributed on the first day of the month next following the time he/she becomes Disabled if he/she has attained age fifty (50) at the time he/she becomes Disabled. The vested Excess Retirement Benefit of such Part A Participant shall be distributed on the first day of the month next following such Part A Participant attaining the age of fifty (50) if he/she becomes Disabled prior to attaining that age. The vested Excess Retirement Benefit shall be paid in the form of payment elected by the Part A Participant in accordance with Section 3.5 (subject to the provisions of paragraph B. and J. of section 3.5). A Part A Participant shall be entitled to make a Subsequent Election with respect to the distribution of a vested Excess Retirement Benefit in accordance with and subject to the provisions of Section 3.2, above.

3.7 Death. In event of the death of a Part A Participant prior to commencing payment of his/her Excess Retirement Benefit under this Plan, an amount equal to fifty-five percent (55%) of the vested Excess Retirement Benefit of such Part A Participant shall be paid and distributed to the Beneficiary of such Part A Participant under Article IV of this Part A of the Plan, below, in the form of an annuity for the life of the Beneficiary, payable in monthly payments, commencing on the first day of the month next following the date of death of such Part A Participant.

3.8 Nonqualified Deferred Compensation Plan Requirements. Notwithstanding anything to the contrary expressed or implied herein, the deferral of all compensation under this Plan shall be subject to the requirements set forth in Article XI, Section 11.1 of Part C of the Plan.

ARTICLE IV.

BENEFICIARY

The Beneficiary of a Part A Participant’s Excess Retirement Benefit shall be the person or persons who is or are the beneficiary or beneficiaries entitled to receive the vested Excess Retirement Benefit of the Part A Participant pursuant to the designation of the form of payment thereof and such Beneficiary made by the Part A Participant pursuant to the Plan.

ARTICLE V.

LEAVE OF ABSENCE

If a Part A Participant is authorized by the Company for any reason, including military, medical, or other, to take a leave of absence from employment, such Part A Participant’s participation in Part A of the Plan shall remain in effect.

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ARTICLE VI.

ADMINISTRATION OF PART A OF THE PLAN

Except as otherwise expressly provided herein, this Part A of the Plan shall be administered pursuant to the provisions of Part C of the Plan.

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PART B. SUPPLEMENTAL RETIREMENT BENEFITS

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ARTICLE I.

PURPOSE AND SCOPE OF PART B

1.1 Part B, Supplemental Retirement Benefits. The provisions of Part B of the Plan shall establish and provide supplemental retirement benefits to Part B Participants.

1.2 Separate Benefits. The Supplemental Retirement Benefits provided to participants under Part B of the Plan are separate and independent from Excess Retirement Benefits provided under Part A of the Plan.

1.3 Deferral of Compensation. The Supplemental Retirement Benefits provided to Participants under Part B of the Plan shall be considered and treated as deferral of compensation to the extent and in the manner provided for in Section 409A of the Code and Treasury Regulations thereunder.

ARTICLE II.

2.1 Eligibility. No person other than a Part B Participant who is an Officer shall participate in Part B of the Plan. In no event shall any employee of the ONEOK Group be eligible to participate in the Plan.

2.2 Scope of Part B Participation. A Part B Participant shall not be entitled to participate in Part A of the Plan or to receive benefits thereunder unless the Part B Participant is also a Part A Participant.

2.3 Election to Defer Compensation.

A. Except as provided in Section 2.3.B., of this Article, the Company, pursuant to the Plan, elects, determines and provides for the time and form of payment of a Supplemental Retirement Benefit to any Part B Participant. The time and form of payment of a Supplemental Retirement Benefit is stated and provided in Article III of this Part B of the Plan.

B. All Elections made by a Part B Participant under the ONEOK 2005 SERP shall apply to the same effect under this Plan as if made under the terms of this Plan. Any Election of the time and form of payment of a Supplemental Retirement Benefit of a Part B Participant shall apply with respect to all compensation deferred under the Plan for the Part B Participant.

C. A Part B Participant shall be allowed to change the form of an annuity benefit to the extent provided in Section 3.5 of Article III of this Part B of the Plan. A Part B Participant shall be allowed to make a Subsequent Election as to time of payment of a Supplemental Retirement Benefit as provided in Section 3.2 of Article III of this Part B of the Plan.

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ARTICLE III.

SUPPLEMENTAL RETIREMENT BENEFIT

3.1 Supplemental Retirement Benefit.

A. The Company shall pay a monthly Supplemental Retirement Benefit to each Part B Participant which shall be an amount calculated as follows:

(1) Calculate a single (straight) life annuity payable at age sixty-five (65) equal to the product of the Part B Participant’s Final Average Earnings, multiplied by the Part B Participant’s Benefit Factor Percentage at his/her Retirement under the Table in Section 3.1.D. of this Article III, below, and then multiplied by the Part B Participant’s Service Factor Percentage at his/her Retirement under the Table in Section 3.1.E. of this Article III, below;

(2) Apply early commencement of payment provisions based upon the age of the Part B Participant when Supplemental Retirement Benefit payments to the Part B Participant commence pursuant to Section 3.1.F. of this Article III, below;

(3) Apply the factors for the form of payment that has been elected by the Part B Participant in accordance with the terms and provisions of this Plan as an actuarial equivalent of a single (straight) life annuity, if such elected form of payment is other than a single (straight) life annuity, in accordance with the Plan and reasonable actuarial assumptions and methods, as determined by the Committee; and

(4) Deduct the Retirement Plan Benefit pursuant to Section 3.1.G. of this Article III, below, and the Excess Retirement Benefit pursuant to Section 3.1.H. of this Article III, below, calculated at the same time and the form of the Supplemental Retirement Benefit elected under this Plan, irrespective of the time and form of payment of the Retirement Plan Benefit elected by the Participant for the Retirement Plan.

B. The Supplemental Retirement Benefit shall be calculated for the time of the commencement of payment of it to the Part B Participant (hereinafter referred to as the “Supplemental Retirement Benefit Commencement Date”) pursuant to the terms and provisions of this Plan governing the time and form of payment thereof, irrespective of whether or not a corresponding Retirement Plan Benefit is then being paid or is to commence payment to such Part B Participant at that time, and irrespective of the time and form of payment of the Retirement Plan Benefit that has been elected, is being paid or may be paid to the Part B Participant.

C. The Committee shall be authorized to take such other actions and apply procedures that it determines, in its discretion, to calculate, determine and commence the payment of a Supplemental Retirement Benefit to a Part B Participant at the Supplemental Retirement Benefit Commencement Date.

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D. Benefit Factor Percentage. A Part B Participant’s Benefit Factor Percentage shall be based upon his/her age at his/her Retirement, as follows:

Retirement Age	Benefit Factor Percentage
50 & under		50	%
51		51	%
52		52	%
53		53	%
54		54	%
55		55	%
56		56	%
57		57	%
58		58	%
59		58.5	%
60		59	%
61		59.5	%
62		60	%
63		60	%
64		60	%
65 & over		60	%

E. Service Factor Percentage. A Part B Participant’s Service Factor Percentage shall be based upon his/her completed Years of Service at his/her Retirement, as follows:

Years of Service	Service Factor Percentage
1		5	%
2		10	%
3		15	%
4		20	%
5		25	%
6		30	%
7		35	%
8		40	%
9		45	%
10		50	%
11		55	%
12		60	%
13		65	%
14		70	%
15		75	%
16		80	%
17		85	%
18		90	%
19		95	%
20 & over		100	%

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F. Adjustment of Retirement Benefit Payments; Early Commencement. The amount of a Part B Participant’s Supplemental Retirement Benefit payments will be reduced by reason of early commencement of payment thereof, based on the following table depending upon the Part B Participant’s age when Supplemental Retirement Benefit payments to the Part B Participant commence:

Part B Participant Age At Commencement	Early Commencement Reduced Payout Percentage Factor
Under 50		0
50		50	%
51		55	%
52		60	%
53		65	%
54		70	%
55		75	%
56		80	%
57		85	%
58		90	%
59		95	%
60		97	%
61		99	%
62 & over		100	%

G. Retirement Plan Benefit Offset. The Supplemental Retirement Benefit of a Part B Participant shall be offset and reduced by an amount equal to the Retirement Plan Benefit payable to such Part B Participant to be calculated in the same form of payment and as if it is to be paid at the time payment of the Supplemental Retirement Benefit is calculated and made under this Plan.

H. Excess Retirement Benefit Offset. If a Part B Participant is also a Part A Participant under the Plan and entitled to receive an Excess Retirement Benefit under Part A of the Plan, the Supplemental Retirement Benefit of such Part B Participant shall be offset and reduced by an amount equal to such Excess Retirement Benefit payable to such Part B Participant pursuant to Part A of the Plan.

3.2 Payment of Supplemental Retirement Benefit.

A. Subject to the requirements of Section 3.3 below (six-month required delay of payment for a Specified Employee), a vested Supplemental Retirement Benefit shall be paid to a Part B Participant entitled thereto or his/her Beneficiary, commencing on his/her Normal Specified Distribution Date.

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B. A Part B Participant shall be allowed to make a Subsequent Election to change the time of distribution and payment of his/her Supplemental Retirement Benefit from his/her Normal Specified Distribution Date to a Subsequent Election Distribution Date resulting from such election, if:

(i) he/she delivers a written notification of such Subsequent Election to the Committee, or its designee, in the form it prescribes, not less than twelve (12) months prior to his/her Normal Specified Distribution Date, and

(ii) he/she makes a corresponding Subsequent Election with respect to any Excess Retirement Benefit he/she is entitled to under Part A of the Plan in such written notification.

C. A Part B Participant shall be allowed to make a Subsequent Election as to any Subsequent Election Distribution Date established for payment of his/her Supplemental Retirement Benefit if:.

(i) he/she delivers a written notification of such Subsequent Election to the Committee, or its designee, in the form it prescribes, not less than twelve (12) months prior to such Subsequent Election Distribution Date, and

(ii) he/she makes a corresponding Subsequent Election with respect to any Excess Retirement Benefit he/she is entitled to under Part A of the Plan in such written notification.

D. Notwithstanding anything to the contrary otherwise provided in the Plan or in any Election or Subsequent Election of a Part B Participant, any Subsequent Election made under the Plan shall result in a Subsequent Election Distribution Date of his/her Supplemental Retirement Benefit being established for it, and the first distribution and payment with respect to which such Subsequent Election is made being deferred to a Subsequent Election Distribution Date that is for not less than five (5) years from the date such distribution and payment would otherwise have been made.

E. Except as otherwise expressly specified in the Plan, a distribution or payment shall be treated as made upon the date specified under the Plan if the payment is made at such date or a later date within the same taxable year of the Participant or, if later, by the 15th day of the third calendar month following the date specified under the Plan and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. In addition, a distribution or payment shall be treated as made upon the date specified under the Plan and shall not be treated as an accelerated payment if the payment is made no earlier than thirty (30) days before the designated payment date and the Participant is not permitted, directly or indirectly to designate the taxable year of the payment. For purposes of this paragraph, if the date specified is only a designated taxable year of the Participant, or a period of time during such a taxable year, the date specified under the Plan is treated as the first day of such taxable year or the first day of the period

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of time during such taxable year, as applicable. If calculation of the amount of the distribution or payment is not administratively practicable due to events beyond the control of the Participant (or Participant’s beneficiary), the distribution or payment will be treated as made upon the date specified under the Plan if the distribution or payment is made during the first taxable year of the Participant in which the calculation of the amount of the distribution or payment is administratively practicable. For purposes of this section, the inability of a Corporation to calculate the amount or timing of a distribution or payment due to a failure of a Participant (or Participant’s beneficiary) to provide reasonably available information necessary to make such calculation does not constitute an event beyond the control of the Participant.

3.3 Specified Employee; Six (6) Month Required Delay in Payment. If a Part B Participant is a Specified Employee his/her Supplemental Retirement Benefit shall not commence being paid until after the end of the Specified Employee Required Deferral Period.

In the case of any Participant who is a Specified Employee as of the date of a Separation from Service, distribution and payments of any Deferred Compensation may not be made before the date that is six (6) months after the date of Separation from Service (or, if earlier than the end of the six-month period, the date of death of the Specified Employee). For this purpose, a Participant who is not a Specified Employee as of the date of a Separation from Service will not be treated as subject to this requirement even if the Participant would have become a Specified Employee if the Participant had continued to provide services through the next Specified Employee Effective Date; and a Participant who is treated as a Specified Employee as of the date of a Separation from Service will be subject to this requirement even if the Participant would not have been treated as a Specified Employee after the next Specified Employee Effective Date had the Specified Employee continued in employment with the Corporation through the next Specified Employee Effective Date. The required delay in payment is met if payments to which a Specified Employee would otherwise be entitled during the first six (6) months following the date of Separation from Service are accumulated and paid on the first day of the seventh month following the date of Separation from Service, or if each payment to which a Specified Employee is otherwise entitled upon a Separation from Service is delayed by six (6) months. The Committee shall have and retain discretion to choose which method will be implemented, provided that no direct or indirect election as to the method may be provided to the Participant. For an affected Specified Employee, a date upon which the Committee or the Corporation designates that the payment will be made after the six-month delay is treated as a fixed payment date for purposes of the other requirements of the Plan once the Separation from Service has occurred.

In such a case the Part B Participant shall, to the extent permissible under Code Section 409A, receive a Specified Employee Catch-Up Payment at the end of the Specified Employee Required Deferral Period and thereafter receive vested Supplemental Retirement Benefit monthly payments in accordance with the Plan. If such a Specified Employee Catch-Up Payment is not permissible under Code Section 409A, the Supplemental Retirement Benefit shall be paid and distributed to the Specified Employee in accordance with the requirements of Code Section 409A and the regulations thereunder, and the time and form of payment elected shall not otherwise be changed or accelerated.

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3.4 Vesting of Supplemental Retirement Benefit. Subject to Sections 3.5 and 3.6 of this Article III, below, a Part B Participant’s Supplemental Retirement Benefit shall unconditionally vest in such Part B Participant and become nonforfeitable upon the Part B Participant’s completion of five (5) Years of Service; provided that the Supplemental Retirement Benefit shall not vest in a Part B Participant at the time of, or by reason of his/her Retirement or under any other circumstance if he/she has not completed five (5) Years of Service.

3.5 Form of Payment.

A. The vested Supplemental Retirement Benefit shall be paid to a Part B Participant in the form of payment elected by the Part B Participant, subject to the provisions of paragraph B. of this Section 3.5, below, as to a Part B Participant who is Married on or after his/her Initial Participation Date as a Part B Participant in the Plan.

B. The vested Supplemental Retirement Benefit shall be paid to a Part B Participant who is Married on or after his/her Initial Participation Date as a Part B Participant in the Plan in the form of a 50% qualified joint and survivor annuity (as defined in the Retirement Plan), unless such Part B Participant in writing elects a different form of payment of his/her vested Supplemental Retirement Benefit which election is delivered to the Committee or its designee, and such Part B Participant’s Spouse consents in writing to such election of a different form of payment, and the Spouse’s consent acknowledges the effect of such election and is witnessed by a Plan representative or notary public, or it is established to the satisfaction of the Committee that the Spouse consent as herein required may not be obtained because there is not a Spouse, because the Spouse cannot be located, or because of a similar circumstances recognized by the Committee in its sole discretion.

C. A Part B Participant who is not Married may elect a form of payment of his/her vested Supplemental Retirement Benefit and designate a Beneficiary, and change his/her designation of a Beneficiary, without requiring consent by any other person, irrespective of another person having any other particular relationship to the Part B Participant (including a Domestic Partner relationship), or another person previously having been designated as a Beneficiary by the Part B Participant, subject, however, to the authority, powers and discretion of the Committee provided for under the Plan.

D. The forms of payment of the vested Supplemental Retirement Benefit under the Plan which may be elected by and paid to a Part B Participant shall be the same forms of payment and benefit as are provided for a vested retirement benefit of a Group C Participant under the Retirement Plan.

E. Subject to the foregoing provisions of this Section 3.5, the forms of payment of a vested Supplemental Retirement Benefit to a Part B Participant and another individual as a survivor beneficiary, including a Spouse, Domestic Partner, child or other

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individual, shall be payable to the Part B Participant and the survivor beneficiary who is designated in writing as the survivor beneficiary by the Part B Participant in a written instrument signed by the Part B Participant and delivered to the Committee or its designee in accordance with procedures prescribed by the Committee.

F. In the event a Part B Participant does not effectively make an election of the form of payment of a vested Supplemental Retirement Benefit or does not effectively designate a survivor beneficiary, if applicable, such vested Supplemental Retirement Benefit shall be paid in the same form of payment and benefit and to the Part B Participant and to his/her beneficiary as applicable under the Retirement Plan with respect to the Retirement Plan benefit of the Part B Participant. Provided, the time of payment of the Supplemental Retirement Benefit to a Part B Participant shall be determined pursuant to the terms of this Plan and not pursuant to or under the Retirement Plan.

G. A Part B Participant shall be allowed to change the form of payment of a Supplemental Retirement Benefit that is initially elected and designated, or any permissible form previously elected by the Part B Participant hereunder, to the extent provided in this Section 3.5. Any such change in the form of payment pursuant to this Section 3.5 shall be allowed only if (1) it is made in writing by the Part B Participant in an instrument prescribed by the Committee prior to the first payment and distribution of a Supplemental Retirement Benefit, (2) the Committee determines that the previously elected form of payment and the changed form of payment are actuarially equivalent applying reasonable actuarial methods and assumptions, and (3) the Part B Participant complies with such other requirements as the Committee may prescribe.

H. A change in form of payment pursuant to the foregoing provisions shall not change, delay or accelerate the scheduled date for the first annuity payment of a Supplemental Retirement Benefit under the Plan.

I. Each change in form of payment of a Supplemental Retirement Benefit pursuant to the foregoing provisions shall be deemed to make a similar change in form of payment with respect to any Excess Retirement Benefit payable to the Participant under the Plan.

J. If the present value of Supplemental Retirement Benefit payable in an annuity form of payment under the Plan is less than $25,000 determined on an actuarially equivalent basis the Committee shall require that the Supplemental Retirement Benefit be paid in a single lump sum payment to the Part B Participant, but only if such payment is authorized and allowed to be made under Code section 409A and Treasury Regulations.

3.6 Disability. If a Part B Participant becomes Disabled prior to his/her Separation from Service, the vested Supplemental Retirement Benefit of such Part B Participant shall be distributed on the first day of the month next following the time he/she becomes Disabled if he/she has attained age fifty (50) at the time he/she becomes Disabled. The vested Supplemental Retirement Benefit of such Part B Participant shall be distributed on the first day of the month next following such Part B Participant attaining the age

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of fifty (50) if he/she becomes Disabled prior to attaining that age. The vested Supplemental Retirement Benefit shall be paid in the form of payment elected by the Part B Participant in accordance with Section 3.5 (subject to the provisions of Section B. and J. of section 3.5). A Part B Participant shall be entitled to make a Subsequent Election with respect to the distribution of a vested Supplemental Retirement Benefit in accordance with and subject to the provisions of Section 3.2, above.

3.7 Death. In the event of the death of a Part B Participant prior to commencing payment of his/her Supplemental Retirement Benefit an amount equal to fifty-five percent (55%) of the vested Supplemental Retirement Benefit shall be paid and distributed to the Beneficiary of such Part B Participant under Article IV of this Part B of the Plan, below, in the form of an annuity for the life of the Beneficiary, payable in monthly payments, commencing on the first day of the month next following the date of death of such Part B Participant.

3.8 Nonqualified Deferred Compensation Plan Requirements. Notwithstanding anything to the contrary expressed or implied herein, the deferral of all compensation under this Plan shall be subject to the requirements set forth in Article XI, Section 11.1 of Part C of the Plan.

ARTICLE IV.

BENEFICIARY

The Beneficiary of a Part B Participant’s Supplemental Retirement Benefit shall be the person or persons who is or are the beneficiary or beneficiaries entitled to receive the vested Supplemental Retirement Benefit of the Part B Participant pursuant to the designation of the form of payment and of such Beneficiary made by the Part B Participant pursuant to the Plan.

ARTICLE V.

SUPPLEMENTAL RETIREMENT BENEFIT ADJUSTMENTS

The Committee shall be authorized to make and apply special adjustments in determining the amount of a Part B Participant’s Supplemental Retirement Benefit. Such adjustments may be made from time to time by the Committee for any Part B Participant, and may include, without limitation, the granting or deemed accrual of additional Years of Service, the waiver of an offset of retirement benefits provided by a prior employer, or such other adjustments as the Committee determines, in its sole discretion; provided, however, that no such adjustment shall be effective until it is made and expressly acknowledged in writing by the Committee.

ARTICLE VI.

LEAVE OF ABSENCE

If a Part B Participant is authorized by the Company for any reason, including military, medical, or other, to take a leave of absence from employment, such Part B Participant’s Plan Agreement shall remain in effect.

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ARTICLE VII.

ADMINISTRATION OF PART B OF THE PLAN

Except as otherwise expressly provided herein, this Part B of the Plan shall be administered pursuant to the provisions of Part C of the Plan.

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PART C.

PLAN ADMINISTRATION AND MISCELLANEOUS PROVISIONS

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ARTICLE I.

PURPOSE AND SCOPE OF PART C

The purpose of Part C of the Plan is to establish and provide certain provisions governing the administration, and interpretation and application of all the provisions of the Plan. Unless otherwise expressly indicated, the terms and provisions of Part C of the Plan shall be applicable to Part A, Part B and Part C of the Plan.

ARTICLE II.

DEFINITIONS AND CONSTRUCTION

2.1 Definitions. For purposes of Parts A, B and C of the Plan, the following phrases or terms shall have the indicated meanings unless otherwise clearly apparent from the context:

“Base Cash Compensation” shall mean the regular monthly salary paid to a Participant by the Company before any deductions or exclusions for taxes or other purposes, and excluding any vehicle allowance, incentives, commissions and any other special pay.

“Beneficiary” shall mean the individual or individuals designated as entitled to survivor benefits as a beneficiary of a Participant in accordance with the Plan.

“Board of Directors” shall mean the Board of Directors of ONE Gas, Inc., unless otherwise indicated or the context otherwise requires.

“Change in Ownership or Control” shall mean (i) prior to the effective date of the Separation, a change in the ownership or effective control of ONEOK or in the ownership of a substantial portion of ONEOK’s assets within the meaning of Code Section 409A and the Treasury Regulations thereunder; and (ii) on or after the effective date of the Separation, a change in the ownership or effective control of ONE Gas or in the ownership of a substantial portion of ONE Gas’s assets within the meaning of Code Section 409A and the Treasury Regulations thereunder. For avoidance of doubt, the Separation will not constitute a Change in Ownership or Control for purposes of the Plan.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Committee” shall mean the Executive Compensation Committee of the Board of Directors or such other Committee appointed to manage and administer the Plan and individual Plan Agreements in accordance with the provisions of Article III of this Part C of the Plan.

“Company” shall mean ONE Gas, Inc., an Oklahoma corporation, or any division or subsidiary thereof.

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“Compensation” shall mean the Base and Short-Term Incentive Cash Compensation from the Company paid to or deferred by a Participant during a calendar year.

“Declaration of Domestic Partnership” shall mean a written declaration, certificate, affidavit or other instrument prescribed by the Committee that is signed by a Participant and/or a Domestic Partner to describe and confirm a Participant’s domestic partner relationship with the Domestic Partner.

“Deferred Compensation” shall mean any Excess Retirement Benefit or Supplemental Retirement Benefit to be paid to a Participant pursuant to the Plan.

“Disabled” shall mean that a Participant is unable to engage in substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or is, by reason of any medically determinable physical or mental impairment which can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident or health plan covering Employees of the Company.

“Domestic Partner” shall mean an individual other than a Participant with whom the Participant has a domestic partner relationship which meets the following requirements:

A. A relationship between partners of the same or opposite sex who:

1. Are registered with state or local government as domestic partners (as applicable by state), or have jointly signed a written Declaration of Domestic Partnership as provided for herein, or have a marriage license for persons who reside in states that recognize civil unions;

2. Are in a committed relationship and are not married to or legally separated from any other individual under either statutory or common law;

3. Are financially interdependent and have furnished proof of joint ownership and have furnished documents to include two (2) of the conditions of joint ownership; and

B. Conditions of a Declaration of Domestic Partnership are the following:

1. The individual who signs the Declaration of Domestic Partnership with the Participant must be an adult individual with whom a Participant declares he/she has chosen to share one another’s lives in an intimate and committed relationship of mutual caring, the establishment of which domestic partnership is confirmed when both persons sign and deliver a Declaration of Domestic Partnership to the Committee, or its designee, in the form prescribed by it, and at the time of delivery (a) neither person is

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married to someone else or is a member of another domestic partnership with someone else that has not been terminated, dissolved, or adjudged a nullity, (b) the two (2) persons are not related by blood in a way that would prevent them from being married to each other in the state of their residence, (c) both persons are at least eighteen (18) years of age, (d) either (i) both persons are members of the same sex, or (ii) the two (2) persons are members of the opposite sex, and (e) both persons are capable of consenting to the domestic partnership.

2. The Participant and the other individual furnish satisfactory proof of at least two (2) of the following:

a. Joint checking, bank, or investment account.

b. Joint credit account, mortgage or lease for residence identifying both partners as tenants.

c. Joint ownership of an automobile or home.

d. A Will or revocable living trust and/or life insurance policy which designates the other as a primary beneficiary.

e. Beneficiary Designation form for a retirement plan which designates the other as primary beneficiary.

“Effective Date” shall mean the effective date of the Plan, January 1, 2014.

“Election” shall mean the Election of a Participant or by the Company to defer payment and distribution of Deferred Compensation to a Participant made pursuant to the terms and provisions of the ONEOK 2005 SERP, that shall include the Participant’s Election of the time of payment and the Company’s Election of the form of payment.

“Employee” shall mean any person who is in the regular full-time employment of the Company or is on authorized leave of absence therefrom, as determined by the personnel rules and practices of the Company. The term does not include persons who are retained by the Company solely as consultants or under contract.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“Excess Retirement Benefit” shall mean an amount equal to the difference between (i) the Retirement Plan Benefit to which the Part A Participant would be entitled under the Retirement Plan if such Retirement Plan Benefit was computed without the restrictions or limitations imposed by Sections 401(a)(17) and 415(b) of the Code as now or hereafter in effect, less (ii) the amount of Retirement Plan Benefit payable to the Part A Participant under the Retirement Plan.

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“Final Average Earnings” shall mean the average of the highest thirty-six (36) consecutive months Compensation during the last sixty (60) month period of an Employee’s employment with the Company.

“Fixed Schedule” shall mean the distribution or payment of compensation deferred under the Plan in a fixed schedule of distributions or payments in accordance with the Participant’s Election.

“Former ONE Gas Employee” means any individual (or any beneficiary, dependent, or alternate payee of such individual, as the context requires) whose employment with any member of the ONEOK Group was terminated prior to January 1, 2014, if such individual was allocated in connection with the Separation to any member of the ONE Gas Group as of January 1, 2014 by ONEOK in its sole discretion.

“Initial Participation Date” shall mean the date an Employee first became a Part A Participant and/or Part B Participant in the ONEOK 2005 SERP.

“Married” (or “Marriage”) shall mean a legal union between Spouses.

“Normal Specified Distribution Date” shall mean as to a Part A Participant or Part B Participant, the first day of the calendar month next following or coincident with the later of the date the Participant has elected in his/her Election the Specified Time of payment and distribution of compensation deferred under the Plan which shall be either (1) the later of (a) a Specified Date, or (b) the date such Part A Participant (i) attains age fifty (50), (ii) completes five (5) years of service with the Company, and (iii) has a Separation from Service with the Company; or (2) the date such Part A Participant (a) attains age fifty (50), (b) completes five (5) years of service with the Company, and (c) has a Separation from Service with the Company.

“Officer” shall mean a person who is an elected officer of the Company.

“ONE Gas” shall mean ONE Gas, Inc., an Oklahoma corporation, or any division or subsidiary thereof.

“ONE Gas Employee” means an active employee or an employee on vacation or on approved leave of absence (including sick leave, qualified military service under the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended, and leave under the Family Medical Leave Act, as amended), in either case, of any member of the ONE Gas Group on or after January 1, 2014, and shall include any beneficiary, dependent, or alternate payee of such employee, as the context requires.

“ONE Gas Group” means ONE Gas and each subsidiary of ONE Gas as of January 1, 2014 and any ONE Gas subsidiary that is established or acquired after January 1, 2014.

“ONE Gas Pre-2005 SERP” shall mean the separate ONE Gas, Inc. Supplemental Executive Retirement Plan, which ONE Gas established effective January 1, 2014 to receive liabilities transferred from the ONEOK Frozen SERP in connection with the Separation.

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“ONEOK” shall mean ONEOK, Inc., an Oklahoma corporation.

“ONEOK 2005 SERP” shall mean the ONEOK, Inc. 2005 Supplemental Executive Retirement Plan.

“ONEOK Frozen SERP” shall mean the ONEOK, Inc. Supplemental Executive Retirement Plan, which was frozen pursuant to the terms thereof effective December 31, 2004.

“ONEOK Group” means (i) prior to January 1, 2014, ONEOK and any of its direct or indirect subsidiaries, and (ii) on and after January 1, 2014, ONEOK and its subsidiaries as of January 1, 2014 (other than any member of the ONE Gas Group) and any ONEOK subsidiary (other than any member of the ONE Gas Group) that is established or acquired after January 1, 2014.

“Part A Participant” shall mean a ONE Gas Employee or Former ONE Gas Employee who was a Part A Participant in the ONEOK 2005 SERP immediately before January 1, 2014. Exhibit B sets forth the Part A Participants in the Plan as of the effective date of the Plan.

“Part B Participant” shall mean shall mean a ONE Gas Employee or Former ONE Gas Employee who is an Officer and was a Part B Participant in the ONEOK 2005 SERP immediately before January 1, 2014. Exhibit C sets forth the Part B Participants in the Plan as of the effective date of the Plan.

“Participant” shall mean a Part A Participant, Part B Participant or both Part A Participant and Part B Participant, as applicable.

“Performance-Based Compensation” shall mean Compensation that is conditioned upon or subject to meeting certain requirements similar to those under Code Section 162(m), as more particularly provided for in Treasury Regulations issued under Code Section 409A.

“Plan Agreement” shall mean a written agreement which was entered into by and between ONEOK and a Participant pursuant to the terms of the ONEOK 2005 SERP, which shall apply to the same effect under this Plan as if entered into by and between the Company and the Participant.

“Plan” shall mean this ONE Gas, Inc. Supplemental Executive Retirement Plan as embodied herein and as amended from time to time.

“Rabbi Trust” shall mean the trust created to hold assets which will be used to pay the benefits provided hereunder, as provided in Section 5.4 of Article V of this Part C of the Plan.

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“Retirement” and “Retire” shall mean when Participant attains age fifty (50), completes five (5) years of service with the Company, and has a Separation from Service other than Separation from Service as a result of death of the Employee, irrespective of whether or not the Employee is considered to have retired under the Retirement Plan or for any other purpose at the time of his/her termination of employment.

“Retirement Plan” shall mean the ONE Gas, Inc. Retirement Plan.

“Retirement Plan Benefit” shall mean the benefit or benefits to which a Part A and/or Part B Participant is entitled under the Retirement Plan.

“Retirement Plan Benefit Commencement Date” means the date a Participant commences receiving payments of his/her Retirement Benefits under the Retirement Plan.

“Separation” means the separation of ONEOK’s local natural gas distribution business into an independent, publicly traded entity to be known as ONE Gas.

“Separation from Service” means (i) prior to the effective date of the Separation, the termination of a Participant’s employment within the meaning of Treasury Regulations section 1.409A-1(h) with all members of the ONEOK Group and all members of the ONE Gas Group; and (ii) on or after the effective date of the Separation, the termination of a Participant’s employment within the meaning of Treasury Regulations section 1.409A-1(h) with the Company and all members of the ONE Gas Group.

“Service” shall mean employment of a Participant by the Company as a regular full-time employee.

“Short-Term Incentive Cash Compensation” shall mean any payment by the Company under the ONE Gas, Inc. Annual Employee Incentive Plan or the ONE Gas, Inc. Annual Officer Incentive Plan.

“Specified Date” means a specific future date in a calendar year.

“Specified Employee” shall mean an Employee who, as of the date of the Employee’s Separation from Service, is a key employee of the Company if any stock of the Company is then publicly traded on an established securities market or otherwise; and for purposes of this definition, an Employee is a key employee if the Employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with the regulations thereunder and disregarding section 416(i)(5)) at any time during the 12-month period ending on a Specified Employee Identification Date. If an Employee is a key employee as of a Specified Employee Identification Date, the Employee shall be treated as a key employee for purposes of the Plan for the entire 12-month period beginning on the Specified Employee Effective Date. For purposes of identifying a Specified Employee by applying the requirements of section 416(i)(1)(A)(i), (ii), and (iii), the definition of compensation under §1.415(c)-2(a) shall be used, applied as if the Company were not using any safe harbor provided in §1.415(c)-2(d), were not using any of the elective special timing rules provided in §1.415(c)-2(e), and were not using any of the elective special rules provided in §1.415(c)-2(g).

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“Specified Employee Catch-Up Payment” shall mean a lump sum payment equal to all regularly scheduled Excess Retirement Benefit and/or Supplemental Retirement Benefit monthly payments to which a Part A Participant or Part B Participant is entitled to under the Plan but which are not paid on and after the commencement of payment of his/her Retirement Plan Benefit because of a Specified Employee Required Deferral Period.

“Specified Employee Effective Date” means the first day of the fourth month following the Specified Employee Identification Date.

“Specified Employee Identification Date” means December 31.

“Specified Employee Required Deferral Period” shall mean the deferral of payment and distribution of an Excess Retirement Benefit or a Supplemental Retirement Benefit with respect to a Part A Participant or Part B Participant, respectively, until a date which is six (6) months after the date of the Separation from Service of such Participant.

“Specified Time” shall mean a specified date at which Deferred Compensation deferred by or for a Participant pursuant to the Plan is required to be distributed or paid and which is specified at the time the Election of deferral of such Deferred Compensation.

“Spouse” shall mean a person recognized as a legal spouse for purposes of federal income tax laws.

“Subsequent Election” shall mean an irrevocable written election made by a Participant to change the time of distribution or payment of Deferred Compensation deferred under the Plan that is made at any time after the initial Election with respect to such Deferred Compensation, or after a prior Subsequent Election. Provided, that a change in a form of payment before a life annuity payment has been made under the Plan, from one type of life annuity to another type of life annuity with the same scheduled date of the first annuity payment shall not be considered as a change in the time and form of payment constituting a Subsequent Election if the annuities are actuarially equivalent, and such change is allowed as contemplated in Treasury Regulations §1.409A-2(b)(ii).

“Subsequent Election Distribution Date” shall mean with respect to a Part A Participant or Part B Participant, the first day of the calendar month next following or coincident with the first date on or after Subsequent Election Specified Time on which the Participant (i) has a Separation from Service with the Company, (ii) has attained age fifty (50), and (iii) has completed five (5) years of service with the Company.

“Subsequent Election Specified Time” shall mean a specified fixed date in a calendar year that must be specified in writing by the Participant in a Subsequent Election that is not less than five (5) years from the date payment would otherwise have been made to the Participant. The written specification of the then applicable Specified Time

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or Subsequent Election Specified Time shall in all cases specify and fix a Subsequent Election Specified Time that is not less than five (5) years from the then applicable Specified Time or Subsequent Election Specified Time, as the case may be, that has been elected and is in effect under the Plan.

“Supplemental Retirement Benefit” shall mean the supplemental retirement benefit to be paid to a Part B Participant pursuant to Article III and other applicable provisions of Part B of the Plan.

“Transferred Participant” shall mean a ONE Gas Employee or Former ONE Gas Employee who was a Part A Participant or a Part B Participant in the ONEOK 2005 SERP immediately before January 1, 2014.

“Unforeseeable Emergency” shall mean a severe financial hardship to the Participant resulting from illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code Section 152(a)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary circumstances arising as a result of events beyond the control of the Participant, and it is intended and directed with respect to any such Unforeseeable Emergency that any amounts distributed under the Plan by reason thereof shall not exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship.

“Years of Service” shall include each full year, but not any portion of a year, during which the Participant has been employed by the Company or any division or subsidiary thereof.

2.2 Construction. The singular when used herein may include the plural unless the context clearly indicates to the contrary. The words “hereof”, “herein”, “hereunder”, and other similar compounds of the word “here” shall mean and refer to the entire Plan and not to any particular provision or section. Whenever the words “Article” or “Section” are used in the Plan, or a cross reference to an “Article” or “Section” is made, the Article or Section referred to shall be an Article or Section of the same Part of the Plan unless otherwise specified.

2.3 Plan Purpose. The Plan is intended to be an unfunded deferred compensation, excess and supplemental retirement benefit plan established and maintained for a select group of management and highly compensated employees of the Company within the meaning of Sections 201(2) and (7), 301(a)(3), (9) and 401(a)(1) of ERISA, and the Company intends that any Participant or Beneficiary shall have the status of an unsecured creditor as to the Plan or any trust, fund or other arrangement established under or with respect to the Plan, and the Plan shall be construed, interpreted and administered in accordance with such intended purpose.

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ARTICLE III.

COMMITTEE

3.1 Appointment of Committee. The general administration of the Plan, including all provisions of Part A and Part B of the Plan, and any Plan Agreements executed hereunder, as well as construction and interpretation thereof, shall be vested in the Committee, the number and members of which shall be designated and appointed from time to time by, and shall serve at the pleasure of, the Board of Directors. Any such member of the Committee may resign by notice in writing filed with the Board of Directors. Vacancies shall be filled promptly by the Board of Directors. The Committee may, at its discretion, delegate discretionary authority for day-to-day administration of the Plan to the Company’s Benefit Plan Administration Committee or its authorized representatives pursuant to a duly adopted resolution or a memorandum of action signed by all members of the Committee or approved via electronic transmission. All actions taken by the Company’s Benefit Plan Administration Committee or its authorized representative shall have the same legal effect and shall be entitled to the same deference as if taken by the Committee itself.

3.2 Committee Officials. The Board of Directors may designate one of the members of the Committee as Chairman and may appoint a secretary who need not be a member of the Committee. The secretary shall keep minutes of the Committee’s proceedings and all data, records, and documents relating to the Committee’s administration of the Plan and any Plan Agreements executed hereunder. The Committee may appoint from its number such subcommittees with such powers as the Committee shall determine. The Committee may authorize one or more of its members, or any other person as agent of the Committee to execute or deliver any instrument, make any payment on behalf of the Committee, or otherwise act for and on behalf of the Committee with respect to the Plan.

3.3 Committee Action. All resolutions or other actions taken by the Committee shall be by the vote of a majority of those present at a meeting at which a majority of the members are present, or in writing by all the members at the time in office if they act without a meeting.

3.4 Committee Rules and Powers. Subject to the provisions of the Plan, the Committee may from time to time establish rules, forms, and procedures for the administration of the Plan, including Plan Agreements. Except as herein otherwise expressly provided, the Committee shall have the exclusive right to interpret the Plan and any Plan Agreements, and to decide any and all matters arising thereunder or in connection with the administration of the Plan and any Plan Agreements, and it shall endeavor to act, whether by general rules or by particular decisions, so as not to discriminate in favor of or against any person. The Committee shall have the exclusive right to determine if a Participant has become Disabled with respect to a Participant (consistent with the Plan’s definition of the term), such determinations to be made on the basis of such medical and/or other evidence that the Committee, in its sole and absolute discretion, may require. Such decisions, actions, and records of the Committee shall be conclusive and binding upon the Company, the Participants, and all persons having or claiming to have rights or interests in or under the Plan.

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3.5 Reliance on Certificates, etc. The members of the Committee and the officers and Directors of the Company shall be entitled to rely on all certificates and reports made by any duly appointed accountants, and on all opinions given by any duly appointed legal counsel. Such legal counsel may be counsel for the Company.

3.6 Liability of Committee. No member of the Committee shall be liable for any act or omission of any other member of the Committee, or for any act or omission on his part, excepting only his own willful misconduct. The Company shall indemnify and save harmless each member of the Committee against any and all expenses and liabilities arising out of membership on the Committee, excepting only expenses and liabilities arising out of a Committee member’s own willful misconduct. Expenses against which a member of the Committee shall be indemnified hereunder shall include, without limitation, the amount of any settlement or judgment, costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted, or a proceeding brought, or settlement thereof. The foregoing right of indemnification shall be in addition to any other rights to which any such member may be entitled.

3.7 Determination of Benefits. In addition to the powers hereinabove specified, the Committee shall have the power to compute and certify, under the Plan and/or any Plan Agreement, the amount and kind of benefits from time to time payable to Participants and their Beneficiaries, and to authorize all disbursements for such purposes.

3.8 Information to Committee. To enable the Committee to perform its functions, the Company shall supply full and timely information to the Committee on all matters relating to the compensation of all Participants, their retirement, death, or other cause for termination of employment, and such other pertinent facts as the Committee may require.

ARTICLE IV.

ADOPTION OF PLAN BY SUBSIDIARY,

AFFILIATED OR ASSOCIATED COMPANIES

Any corporation which is a subsidiary of the Company may, with the approval of the Board of Directors, adopt the Plan and thereby come within the definition of Company in Article I of Part C of the Plan.

ARTICLE V.

SOURCE OF BENEFITS

5.1 Benefits Payable. Excess Retirement Benefits and Supplemental Retirement Benefits payable hereunder shall be paid exclusively from the general assets of the Company or the Rabbi Trust to be established pursuant to Section 5.4 of this Article V; provided, that no person entitled to payment hereunder shall have any claim, right, security interest, or other interest in any fund, trust, account, insurance contract, or asset of the

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Company which may be looked to for such payment. The Company’s liability for the payment of benefits hereunder shall be evidenced only by the Plan and each Plan Agreement entered into between the Company and a Participant.

5.2 Investments to Facilitate Payment of Benefits. Although the Company is not obligated to invest in any specific asset or fund, or purchase any insurance contract, in order to provide the means for the payment of any Excess Retirement Benefits and Supplemental Retirement Benefits under the Plan, the Company may elect to do so, and, in such event, no Participant shall have any interest whatever in such asset, fund, or insurance contract. In the event the Company elects to purchase or causes to be purchased insurance contracts on the life of a Participant as a means for making, offsetting, or contributing to any payment, in full or in part, which may become due and payable by the Company under the Plan or a Participant’s Plan Agreement, such Participant agrees to cooperate in the securing of life insurance on his/her life by furnishing such information as the Company and the insurance carrier may require, including the results and reports of previous Company and other insurance carrier physical examinations as may be requested, and taking any other action which may be requested by the Company and the insurance carrier to obtain such insurance coverage. If a Participant does not cooperate in the securing of such life insurance, the Company shall have no further obligation to such Participant under the Plan.

5.3 Ownership of Insurance Contracts. The Company shall be the sole owner of any insurance contracts acquired on the life of a Participant with all incidents of ownership therein, including, but not limited to, the right to cash and loan values, dividends, if any, death benefits, and the right to termination thereof, and a Participant shall have no interest whatsoever in such contracts, if any, and shall exercise none of the incidents of ownership thereof. Provided, however, the Company may assign any such insurance contracts to the trustee of the Rabbi Trust.

5.4 Trust for Payment of Benefits. The Company shall create or utilize a Rabbi Trust for the purpose of facilitating any retirement benefits payable hereunder. Such trust will be funded to provide the applicable vested Excess Retirement Benefits and Supplemental Retirement Benefits payable under the Plan upon the occurrence of any of the following events:

(a) At the Retirement of, and commencement of payment of an Excess Retirement Benefit or a Supplemental Retirement Benefit to a Plan Participant;

(b) Upon a decision by the Committee, or by the Board of Directors; or

(c) Upon a Change in Ownership or Control.

Such funding may be in the form of single premium annuities, or an amount sufficient for the trustee to purchase single premium annuities, or life insurance policies or contracts insuring the lives of Participants, as the case may be, from qualified and financially sound insurance companies, and such other forms or types of investments the Company may select from time to time to provide the applicable vested Excess Retirement Benefits and Supplemental Retirement Benefits payable under the Plan and Plan Agreements. Such funding and the purchase of insurance, if any, will not relieve the Company of its obligations to pay or cause to be paid the benefits hereunder.

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The Rabbi Trust may be maintained and administered to also provide for the funding of payment of amounts payable to participants in other deferred compensation and benefit plans of the Company. The funding, investments and administration of the Rabbi Trust in connection with such other separate plan or plans shall be separately administered and accounted for as determined to be necessary and appropriate by the Company and trustee pursuant to the terms of the Rabbi Trust. It shall be permissible for the trustee to invest funds of the Rabbi Trust in one or more forms of investment that is common to plans being funded thereunder.

The Rabbi Trust shall be a grantor trust of which the Company is the grantor within the meaning of the Code. The principal of the Rabbi Trust held and administered for providing payments under this Plan, or any share thereof so held and administered, and any earnings thereon, shall be held separate and apart from other funds of the Company and shall be used exclusively for the uses and purposes of Part A Participants and/or Part B Participants in the Plan and general creditors of the Company as specified herein below and in the trust instrument. Part A Participants and Part B Participants in the Plan and their Beneficiaries shall have no preferred claim on, or any beneficial ownership in any assets of the Rabbi Trust; and any rights created under the Plan or any Plan Agreements, and the Rabbi Trust are to be made unsecured contractual rights of Part A Participants and Part B Participants (and their Beneficiaries, if applicable) against the Company; and assets held by the Rabbi Trust will be subject to the claims of the Company’s general creditors under federal and state law in the event of insolvency of the Company.

ARTICLE VI.

TERMINATION OF EMPLOYMENT

Neither the Plan nor any Plan Agreement with a Participant hereunder, either singly or collectively, in any way obligate the Company, or any subsidiary of the Company, to continue the employment of a Part A Participant or a Part B Participant with the Company, or any subsidiary of the Company, nor does either limit the right of the Company or any subsidiary of the Company at any time and for any reason to terminate such Part A Participant’s or Part B Participant’s employment. Termination of a Part A Participant’s or Part B Participant’s employment with the Company, or any subsidiary of the Company, for any reason, whether by action of the Company, subsidiary, or such a Part A Participant or Part B Participant, shall immediately terminate such Participant’s participation in the Plan and any such Participant’s Plan Agreement, and all further obligations of either party thereunder, except as may be provided in Article VIII of this Part C, and the Participant’s Plan Agreement. In no event shall the Plan or a Plan Agreement, either singly or collectively, by their terms or implications constitute an employment contract of any nature whatsoever between the Company, or any subsidiary, and a Part A Participant or Part B Participant.

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ARTICLE VII.

TERMINATION OF PARTICIPATION

A Part A Participant and a Part B Participant reserves the right to terminate participation in the Plan and any such Participant’s Plan Agreement at any time by giving the Company written notice of such termination not less than 30 days (i) prior to the anniversary date of any contract or contracts of insurance on the life of such Part A Participant or Part B Participant which may be in force and utilized by the Company in connection with the Plan, or (ii) prior to the date a Part A Participant or Part B Participant selects for termination if no insurance contract is in effect.

ARTICLE VIII.

TERMINATION, AMENDMENT, MODIFICATION,

OR SUPPLEMENT OF THE PLAN

8.1 Amendment or Termination. Subject to Section 8.2, below, the Company reserves the right to amend, modify, supplement, or terminate the Plan, wholly or partially, from time to time, and at any time. The Company likewise reserves the right to amend, modify, or supplement any written instrument made or delivered with respect to the administration of the Plan, or any Plan Agreement, wholly or partially, from time to time. Such right to amend, modify, supplement, or terminate the Plan or any Plan Agreement, as the case may be, shall be exercised for the Company by the Board of Directors; provided, that the Committee shall also be authorized to amend or modify the terms and provisions of the Plan, or such a written instrument or Plan Agreement, except that any amendment or modification of the Plan or Plan Agreement that changes the form or amount of any payment or benefit provided for under the Plan shall be made only by action of the Board of Directors; provided, further, in the event of a Change in Ownership or Control of the Company, for a period of two (2) years after the date of such Change of Ownership or Control the surviving corporation may terminate or amend the Plan only by substitution by such corporation of another plan or program, or by amendments to the Plan, which provide benefits no less favorable to the Part A Participants or Part B Participants of this Plan; and upon the expiration of such two (2) year period such surviving corporation may thereafter terminate or amend the Plan or any such substituted plan subject in any case to Section 8.2, below.

8.2 Rights and Obligations Upon Amendment, Termination. The following terms and conditions shall govern the rights and obligations of a Part A Participant or Part B Participant and the Company (including any surviving corporation in event of a Change of Ownership or Control), respectively, with respect to the amendment or termination of the Plan.

A. Notwithstanding anything to the contrary expressed or provided in the Plan or any Plan Agreement of a Part A Participant or Part B Participant, no amendment, modification or termination of the Plan, shall decrease a Part A Participant’s or Part B Participant’s accrued Excess Retirement Benefit or Supplemental Retirement Benefit, as applicable. For purposes of this Paragraph A., a Plan amendment which has the effect of

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decreasing a Part A Participant’s or Part B Participant’s accrued Excess Retirement Benefit or Supplemental Retirement Benefit, as the case may be, or eliminating any optional form of payment of a Participant’s accrued Excess Retirement Benefit or Supplemental Retirement Benefit, with respect to benefits attributable to service before the amendment shall be treated as reducing an accrued Excess Retirement Benefit or Supplemental Retirement Benefit. If a vesting schedule under the Plan or any Plan Agreement is amended, a Part A Participant’s and Part B Participant’s non-forfeitable percentage, determined as of the later of the date such amendment is adopted or the date it becomes effective, will not be less than the percentage computed under Part A and Part B of the Plan and Plan Agreements, as applicable, without regard to such amendment.

B. Except as provided in paragraph A of this Section 8.2, upon the termination of the Plan by the Board of Directors, or a termination of the Plan Agreement of a Participant, in accordance with the provisions for such termination, neither the Plan nor the Plan Agreement shall be of any further force or effect, and no party shall have any further obligation under either the Plan or any Plan Agreement so terminated, except as provided in the Plan or Plan Agreement with respect to accrued benefits at the time of such termination or as elsewhere provided in the Plan.

C. For purposes of paragraphs A and B of this Section 8.2, the term “Plan” shall also mean and include any substituted plan that may be established in event of a Change of Ownership or Control as described in Section 8.1, above, and the terms “Excess Retirement Benefit” and “Supplemental Retirement Benefit” shall also mean and include any benefit provided for under such a substituted plan.

ARTICLE IX.

TREATMENT OF BENEFITS

The Excess Retirement Benefit provided for a Part A Participant and the Supplemental Retirement Benefit provided for a Part B Participant under the Plan and/or under any Plan Agreement are in addition to any other benefits available to such Participant under any other Plan, plan or agreement of the Company for its Employees and the Participants, and, except as may be otherwise expressly provided for, the Plan and Plan Agreements entered into hereunder shall supplement and shall not supersede, modify, or amend any other Plan, plan or agreement of the Company. The Excess Retirement Benefits and Supplemental Retirement Benefits under the Plan and/or Plan Agreements entered into hereunder shall not be considered compensation for the purpose of computing contributions or benefits under any plan maintained by the Company, or any of its subsidiaries, which is qualified under Section 401(a) of the Code.

ARTICLE X.

RESTRICTIONS ON ALIENATION OF BENEFITS

No Excess Retirement Benefit or Supplemental Retirement Benefit under the Plan or a Plan Agreement shall be subject to anticipation, alienation, sale, assignment, pledge, encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge the same shall be void. No Excess Retirement Benefit and Supplemental Retirement

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Benefit under the Plan or under any Plan Agreement shall in any manner be liable for or subject to the debts, contracts, liabilities, or torts of the person entitled to such thereto. If any Part A Participant or Part B Participant under the Plan or a Plan Agreement should become bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge any right to a benefit under the Plan or under any Plan Agreement, then such right or benefit shall, in the discretion of the Committee, cease, and in such event, the Committee may, but shall have no duty to hold or apply the same or any part thereof for the benefit of such Part A Participant or Part B Participant, or his/her Beneficiary, in such portion as the Committee, in its sole and absolute discretion, may deem proper.

ARTICLE XI.

MISCELLANEOUS

11.1 Deferral of Compensation Requirements. The following requirements stated in this Section 11.1 shall apply to the Plan, to all Elections or Subsequent Elections made by Participants under the Plan, and to all distributions and payments made pursuant to the Plan.

A. Any compensation deferred under the Plan shall not be distributed earlier than:

(i) Separation from Service of the Participant,

(ii) the date the Participant becomes Disabled,

(iii) death of the Participant,

(iv) a Specified Time (or pursuant to a Fixed Schedule) specified under the Plan at the date of deferral of such compensation,

(v) a Change in Ownership or Control, or

(vi) the occurrence of an Unforeseeable Emergency.

B. Notwithstanding the foregoing, if a Participant becomes entitled to a distribution on account of the Participant’s Separation from Service and is a Specified Employee on the date of the Separation from Service, no distribution shall be made before the date which is six (6) months after the date of the Participant’s Separation from Service, or, if earlier, the date of death of such Participant.

C. No acceleration of the time or schedule of any distribution or payment under the Plan shall be permitted or allowed, except to the extent provided in Treasury Regulations issued under Code Section 409A.

If the Plan, or the Committee acting pursuant to the Plan, permits under any Subsequent Election by a Participant a delay in a payment or a change in the form of payment of compensation deferred under the Plan, such Subsequent Election shall not take effect until at least twelve (12) months after the date on which it is made. In the case

- 38 -

of a Subsequent Election related to a payment to be made upon Separation from Service of a Participant, at a Specified Time or pursuant to a Fixed Schedule, or upon a Change in Ownership or Control, the first payment with respect to which such Subsequent Election is made shall be deferred for a period of not less than five (5) years from the date such payment would otherwise have been made; and any such Subsequent Election related to a payment at a Specified Time or pursuant to a Fixed Schedule may not be made less than twelve (12) months prior to the date of the first scheduled payment to which it relates.

11.2 Execution of Receipts and Releases. Any payment to a Participant, a Participant’s legal representative, or Beneficiary in accordance with the provisions of the Plan or any Plan Agreement executed hereunder shall, to the extent thereof, be in full satisfaction of all claims hereunder against the Company. The Company may require such Participant, legal representative, or Beneficiary, as a condition precedent to such payment, to execute a receipt and release therefore in such form as it may determine. Notwithstanding any provision of this Plan to the contrary, in no event shall the timing of the Participant’s execution of a release, directly or indirectly, result in the Participant designating the calendar year of payment, and if a payment that is subject to execution of a release could be made in more than one taxable year, payment shall be made in the later taxable year.

11.3 No Guarantee of Interests. Neither the Committee nor any of its members guarantees the payment of any amounts which may be or becomes due to any person or entity under the Plan or any Plan Agreement executed hereunder. The liability of the Company to make any payment under the Plan or any Plan Agreement executed hereunder is limited to the then available assets of the Company and the Rabbi Trust established under Section 5.4 of this Part C.

11.4 Company Records. Records of the Company as to a Participant’s employment, termination of employment and the reason therefore, reemployment, authorized leaves of absence, and compensation shall be conclusive on all persons and entities, unless determined to be incorrect.

11.5 Evidence. Evidence required of anyone under the Plan and any Plan Agreement executed hereunder may be by certificate, affidavit, document, or other information which the person or entity acting on it considers pertinent and reliable, and signed, made, or presented by the proper party or parties.

11.6 Notice. Any notice which shall be or may be given under the Plan or a Plan Agreement executed hereunder shall be in writing and shall be mailed by United States mail, postage prepaid. If notice is to be given to the Company, such notice shall be addressed to the Company at:

15 East 5^th Street

Tulsa, OK 74103

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and marked to the attention of the Secretary, Executive Compensation Committee; or, if notice to a Participant, addressed to the address shown on such Participant’s most recent employment file with the Company.

11.7 Change of Address. Any party may, from time to time, change the address to which notices shall be mailed by giving written notice of such new address.

11.8 Effect of Provisions. The provisions of the Plan and of any Plan Agreement executed hereunder shall be binding upon the Company and its successors and assigns, and upon a Participant, the Participant’s Beneficiary, assigns, heirs, executors, and administrators.

11.9 Headings. The titles and headings of Articles and Sections are included for convenience of reference only and are not to be considered in the construction of the provisions hereof or any Plan Agreement executed hereunder.

11.10 Governing Law. All questions arising with respect to the Plan and any Plan Agreement executed hereunder shall be determined by reference to the laws of the State of Oklahoma in effect at the time of their adopting and execution, respectively.

11.11 Effective Date. The terms of this Plan shall be effective January 1, 2014.

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EX-10.11

Exhibit 10.11

$700,000,000

CREDIT AGREEMENT

Dated as of December 20, 2013

among

ONE GAS, INC.,

as the Borrower,

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender and L/C Issuer,

and

The Other Lenders and L/C Issuers Party Hereto

THE ROYAL BANK OF SCOTLAND PLC,

Syndication Agent

JPMORGAN CHASE BANK, N.A.,

Documentation Agent

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

J.P. MORGAN SECURITIES LLC,

and

RBS SECURITIES INC.,

Joint Lead Arrangers and Joint Book Managers

TABLE OF CONTENTS

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS		1
1.01	Defined Terms	1
1.02	Other Interpretive Provisions	21
1.03	Accounting Terms	22
1.04	Rounding	22
1.05	References to Agreements and Laws	22
1.06	Times of Day	23
1.07	Letter of Credit Amounts	23
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS		23
2.01	Committed Loans	23
2.02	Borrowings, Conversions and Continuations of Loans	23
2.03	Bid Loans	24
2.04	Letters of Credit	27
2.05	Swing Line Loans	36
2.06	Prepayments	38
2.07	Termination or Reduction of Commitments	39
2.08	Repayment of Loans	40
2.09	Interest	40
2.10	Fees	40
2.11	Computation of Interest and Fees	41
2.12	Evidence of Debt	41
2.13	Payments Generally	42
2.14	Sharing of Payments	43
2.15	Extension of Maturity Date	44
2.16	Increase in Commitments	45
2.17	Defaulting Lenders	46
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY		49
3.01	Taxes	49
3.02	Illegality	53
3.03	Inability to Determine Rates	54
3.04	Increased Costs; Reserves on Eurodollar Rate Loans	54
3.05	Compensation for Losses	56
3.06	Mitigation Obligations; Replacement of Lenders	56
3.07	Survival	57
ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS		57
4.01	Conditions to Effectiveness of this Agreement (Execution Date)	57
4.02	Conditions to Closing Date and Initial Credit Extension	58
4.03	Conditions to all Credit Extensions	60
ARTICLE V. REPRESENTATIONS AND WARRANTIES		61
5.01	Existence, Qualification and Power	61
5.02	Authorization; No Contravention	61
5.03	Governmental Authorization; Other Consents	61
5.04	Binding Effect	61
5.05	Financial Statements	62
5.06	Litigation	62
5.07	No Default	62

i

5.08	Ownership of Property; Liens	62
5.09	Environmental Compliance	62
5.10	Insurance	63
5.11	Taxes	63
5.12	ERISA Compliance	63
5.13	Subsidiaries	64
5.14	Margin Regulations; Investment Company Act.	64
5.15	Disclosure	64
5.16	Compliance with Laws	64
5.17	[Reserved]	64
5.18	Intellectual Property; Licenses, Etc.	64
5.19	OFAC	65
5.20	Certain Representations and Warranties with respect to the ONE Gas Separation Transactions	65
ARTICLE VI. AFFIRMATIVE COVENANTS		65
6.01	Financial Statements	65
6.02	Certificates; Other Information	66
6.03	Notices	67
6.04	Payment of Obligations	68
6.05	Preservation of Existence, Etc.	68
6.06	Maintenance of Properties	68
6.07	Maintenance of Insurance	69
6.08	Compliance with Laws	69
6.09	Books and Records	69
6.10	Inspection Rights	69
6.11	Use of Proceeds	69
6.12	Sanctions	70
ARTICLE VII. NEGATIVE COVENANTS		70
7.01	Liens	70
7.02	Investments	72
7.03	Indebtedness of Subsidiaries	73
7.04	Fundamental Changes	73
7.05	Change in Nature of Business	74
7.06	Transactions with Affiliates	74
7.07	Burdensome Agreements	74
7.08	Use of Proceeds	74
7.09	Debt to Capital	74
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES		74
8.01	Events of Default	74
8.02	Remedies Upon Event of Default	76
8.03	Application of Funds	77
ARTICLE IX. ADMINISTRATIVE AGENT		77
9.01	Appointment and Authority	77
9.02	Rights as a Lender	78
9.03	Exculpatory Provisions	78
9.04	Reliance by Administrative Agent	79
9.05	Delegation of Duties	79
9.06	Resignation of Administrative Agent	79
9.07	Non-Reliance on Administrative Agent and Other Lenders	80

ii

9.08	Administrative Agent May File Proofs of Claim	80
9.09	Release of Lien on Cash Collateral Upon Expiration of Letters of Credit	81
9.10	Other Agents; Arrangers and Managers	81
ARTICLE X. MISCELLANEOUS		81
10.01	Amendments, Etc.	81
10.02	Notices and Other Communications; Facsimile Copies	83
10.03	No Waiver; Cumulative Remedies; Enforcement	85
10.04	Expenses; Indemnity; Damage Waiver	85
10.05	Payments Set Aside	87
10.06	Successors and Assigns	87
10.07	Confidentiality	93
10.08	Set-off	93
10.09	Interest Rate Limitation	94
10.10	Counterparts	94
10.11	Integration	94
10.12	Survival of Representations and Warranties	94
10.13	Severability	95
10.14	Replacement of Lenders	95
10.15	Governing Law	95
10.16	Waiver of Right to Trial by Jury	96
10.17	No Advisory or Fiduciary Responsibility	97
10.18	USA PATRIOT Act Notice	97
10.19	Electronic Execution of Assignments and Certain Other Documents	97
10.20	ENTIRE AGREEMENT	98
SIGNATURES		S-1

iii

SCHEDULES
1.01A	Existing Sale and Leaseback Transactions
2.01	Commitments and Pro Rata Shares
5.13	Subsidiaries and Other Equity Investments
10.02	Administrative Agent’s Office, Certain Addresses for Notices
EXHIBITS
	Form of
A	Committed Loan Notice
B-1	Bid Request
B-2	Competitive Bid
C	Swing Line Loan Notice
D	Note
E	Compliance Certificate
F	Assignment and Assumption
G	Forms of U.S. Tax Compliance Certificates

iv

CREDIT AGREEMENT

This CREDIT AGREEMENT (this “Agreement”) is entered into as of December 20, 2013, among ONE GAS, INC., an Oklahoma corporation (the “Borrower”), each lender from time to time party hereto (collectively, the “Lenders” and individually, a “Lender”), BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and JPMorgan Chase Bank, N.A. and The Royal Bank of Scotland plc, as L/C Issuers.

The Borrower has requested that the Lenders provide a revolving credit facility, and the Lenders are willing to do so on the terms and conditions set forth herein.

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS

1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below:

“Absolute Rate” means a fixed rate of interest expressed in multiples of 1/100^th of one basis point.

“Absolute Rate Loan” means a Bid Loan that bears interest at a rate determined with reference to an Absolute Rate.

“Acceptable Changes” means amendments, supplements and other modifications that are either (a) not material and adverse to the Lenders, or (b) are agreed to by the Arrangers.

“Administrative Agent” means Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify the Borrower and the Lenders.

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

“Affiliate” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto. For the avoidance of doubt, from and after the Closing Date, ONEOK, Inc. and its Subsidiaries will not be Affiliates of the Borrower and its Subsidiaries unless and to the extent resulting from transactions occurring after the Closing Date.

“Aggregate Commitments” means the Commitments of all the Lenders.

“Agreement” means this Credit Agreement.

1

“Applicable Rate” means, from time to time, the following percentages, set forth in basis points per annum, based upon the Debt Rating as set forth below:

Pricing Level	Debt Ratings S&P/Moody’s	Facility Fee	Applicable Rate for Eurodollar Rate Loans and Letter of Credit Fee	Applicable Rate for Base Rate Loans
1	³A+/A1	7.5 bps	67.5 bps	0 bps
2	A/A2	8.0 bps	79.5 bps	0 bps
3	A-/A3	10.0 bps	90.0 bps	0 bps
4	BBB+ / Baa1	15.0 bps	110.0 bps	10.0 bps
5	£BBB / Baa2	20.0 bps	117.5 bps	17.5 bps

“Debt Rating” means, as of any date of determination, the rating as determined by either S&P or Moody’s (collectively, the “Debt Ratings”) of the Borrower’s non-credit-enhanced, senior unsecured long-term debt; provided that if a Debt Rating is issued by each of the foregoing rating agencies, then the higher of such Debt Ratings shall apply (with the Debt Rating for Pricing Level 1 being the highest and the Debt Rating for Pricing Level 5 being the lowest), unless there is a split in Debt Ratings of more than one level, in which case the Pricing Level that is one level lower than the Pricing Level of the higher Debt Rating shall apply; provided, however, if there are no Debt Ratings, then Pricing Level 5 shall apply.

Initially, the Applicable Rate shall be determined based upon the Debt Rating in effect on the Closing Date. Thereafter, each change in the Applicable Rate resulting from a publicly announced change in the Debt Rating shall be effective during the period commencing on the date of the public announcement thereof and ending on the date immediately preceding the effective date of the next such change.

“Approved Fund” has the meaning set forth in Section 10.06(g).

“Arrangers” means Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC and RBS Securities Inc., each in its capacity as joint lead arranger and joint book manager.

“Assignment and Assumption” means an Assignment and Assumption substantially in the form of Exhibit F.

“Attorney Costs” means and includes all fees, expenses and disbursements of any law firm or other external counsel.

“Attributable Indebtedness” means, on any date, in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital lease.

“Availability Period” means, for any Lender, the period from and including the Closing Date to the earliest of (a) the Maturity Date for such Lender (determined in accordance with Section 2.15), (b) the date of termination of the Aggregate Commitments pursuant to Section 2.07, and (c) the date of termination of the commitment of each Lender to make Loans and of the obligation of the L/C Issuers to make L/C Credit Extensions pursuant to Section 8.02.

2

“Bank of America” means Bank of America, N.A. and its successors.

“Base Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate,” and (c) the Eurodollar Rate plus 1.00%. The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such prime rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.

“Base Rate Committed Loan” means a Committed Loan that is a Base Rate Loan.

“Base Rate Loan” means a Loan that bears interest based on the Base Rate.

“Bid Borrowing” means a borrowing consisting of simultaneous Bid Loans of the same Type from each of the Lenders whose offer to make one or more Bid Loans as part of such borrowing has been accepted under the auction bidding procedures described in Section 2.03.

“Bid Loan” has the meaning specified in Section 2.03(a).

“Bid Loan Lender” means, in respect of any Bid Loan, the Lender making such Bid Loan to the Borrower.

“Bid Loan Sublimit” means an amount equal to $50,000,000. The Bid Loan Sublimit is part of, and not in addition to, the Aggregate Commitments.

“Bid Request” means a written request for one or more Bid Loans substantially in the form of Exhibit B-1.

“Borrower” has the meaning specified in the introductory paragraph hereto.

“Borrowing” means a Committed Borrowing, a Bid Borrowing or a Swing Line Borrowing, as the context may require.

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located or the state of New York, and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank Eurodollar market.

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease (or other arrangement conveying the right to use) of real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP. It is understood that with respect to the accounting for leases as either operating leases or capital leases and the impact of such accounting on the definitions and covenants herein, GAAP as in effect on the Closing Date shall be applied.

3

“Cash Collateralize” has the meaning specified in Section 2.04(g).

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Change of Control” means, with respect to any Person, an event or series of events by which:

(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) after the Closing Date becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a person or group shall be deemed to have “beneficial ownership” of all securities that such person or group has the right to acquire (such right, an “option right”), whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of 25% or more of the equity securities of such Person entitled to vote for members of the board of directors or equivalent governing body of such Person on a fully-diluted basis (and taking into account all such securities that such person or group has the right to acquire pursuant to any option right); or

(b) during any period of 12 consecutive months, a majority of the members of the board of directors or other equivalent governing body of such Person cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body (excluding, in the case of both clause (ii) and clause (iii), any individual whose initial nomination for, or assumption of office as, a member of that board or equivalent governing body occurs as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors by any person or group other than a solicitation for the election of one or more directors by or on behalf of the board of directors).

Notwithstanding the foregoing, “option right” shall not include any securities which any person or group has a right to acquire pursuant to a merger or acquisition agreement, until such right is exercised and such acquisition occurs pursuant to such agreement.

“Closing Date” means the first date all the conditions precedent in Section 4.02 are satisfied or waived in accordance with Section 4.02 (or, in the case of Section 4.02(k), waived by the Person entitled to receive the applicable payment), which date shall be set forth in, and conclusively established by, the notice, dated as of the Closing Date delivered by the Administrative Agent pursuant to Section 4.02. The Closing Date shall not be later than March 31, 2014.

4

“Code” means the Internal Revenue Code of 1986.

“Commercial Paper Borrowing” means a Borrowing of Loans the entire proceeds of which are used, within five (5) Business Days of disbursement, to repay commercial paper issued by the Borrower.

“Commitment” means, as to each Lender, its obligation to (a) make Committed Loans to the Borrower pursuant to Section 2.01, (b) purchase participations in L/C Obligations, and (c) purchase participations in Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.

“Committed Borrowing” means a borrowing consisting of simultaneous Committed Loans of the same Type and, in the case of Eurodollar Rate Committed Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.01.

“Committed Loan” has the meaning specified in Section 2.01.

“Committed Loan Notice” means a notice of (a) a Committed Borrowing, (b) a conversion of Committed Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Committed Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

“Competitive Bid” means a written offer by a Lender to make one or more Bid Loans, substantially in the form of Exhibit B-2, duly completed and signed by a Lender.

“Compliance Certificate” means a certificate substantially in the form of Exhibit E.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Consolidated Net Tangible Assets” means, at any date of determination, the total amount of consolidated assets of the Borrower and its Subsidiaries after deducting therefrom: (a) all current liabilities (excluding (i) any current liabilities that by their terms are extendable or renewable at the option of the obligor thereon to a time more than 12 months after the time as of which the amount thereof is being computed, and (ii) current maturities of the Obligations and other long-term debt); and (b) the value, net of any applicable reserves and accumulated amortization, of all goodwill, trade names, trademarks, patents and other like intangible assets, all as set forth, or on a pro forma basis would be set forth, on the consolidated balance sheet of the Borrower and its Subsidiaries, prepared in accordance with GAAP.

“Consolidated Net Worth” means, as of any date of determination, consolidated shareholders’ equity, determined in accordance with GAAP, of the Borrower and its Subsidiaries as of that date, adjusted as follows: (a) either (i) less the absolute value of net unrealized gains resulting from Swap Contracts that are recorded by the Borrower in accumulated other comprehensive income (loss) as determined in accordance with GAAP, or (ii) plus the absolute value of net unrealized losses resulting from Swap Contracts that are recorded by the Borrower in accumulated other comprehensive income (loss) as determined in accordance with GAAP; and (b) either (i) less the absolute value of defined benefit plan assets that are recorded by the Borrower in accumulated other comprehensive income (loss) as determined in accordance with GAAP, or (ii) plus the absolute value of defined benefit plan liabilities that are recorded by the Borrower in accumulated other comprehensive income (loss) as determined in accordance with GAAP.

5

“Consolidated Total Indebtedness” means, as of any date of determination, Indebtedness of the Borrower and its Subsidiaries on a consolidated basis. For purposes of (i) calculating compliance with Section 7.09, (ii) calculating the ratio of Consolidated Total Indebtedness to Total Capital for the certificate of a Responsible Officer to be delivered on the Closing Date pursuant to Section 4.02(a)(v), and (iii) calculating Consolidated Total Indebtedness in Schedule 2 to the Compliance Certificate delivered pursuant to Section 6.02(a), the following shall apply: (A) the definition of “Swap Contract” shall not include any type of commodity swap transaction, commodity options, forward commodity contracts, commodity cap transactions, commodity floor transactions, commodity collar transactions, or commodity spot contracts and (B) the definition of “Swap Termination Value” shall exclude such commodity contracts and transactions.

“Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“Contribution Business” means certain assets, liabilities and operations of ONEOK’s and certain of its Subsidiaries’ natural gas distribution business (along with certain related miscellaneous assets and liabilities), and the equity interests of certain entities holding certain of such assets, liabilities and operations to the extent intended to be contributed to the Borrower as described in the Registration Statement.

“Control” has the meaning specified in the definition of “Affiliate.”

“Credit Extension” means each of the following: (a) a Borrowing, and (b) an L/C Credit Extension.

“Debt Rating” has the meaning set forth in the definition of “Applicable Rate.”

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect.

“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

“Default Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Rate applicable to Base Rate Loans plus (iii) 2% per annum; provided, however, that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 2% per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Rate plus 2% per annum, in each case to the fullest extent permitted by applicable Laws.

“Defaulting Lender” means, subject to Section 2.17(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith determination that one or more conditions precedent

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to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any L/C Issuer, any Swing Line Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swing Line Loans) within two Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent or any L/C Issuer or Swing Line Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lenders’ obligation to fund a Loan hereunder and states that such position is based on such Lender’s good faith determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.17(b)) upon delivery of written notice of such determination to the Borrower, each L/C Issuer, the Swing Line Lender and each Lender.

“Designated Jurisdiction” means any country or territory to the extent that such country or territory itself is the subject of any Sanction.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith, but excluding (i) any sale, assignment, transfer or other disposal of cash or cash equivalents and (ii) any transfer of property or assets constituting an Investment.

“Documentation Agent” means the entity named as “Documentation Agent” on the cover page of this Agreement.

“Dollar” and “$” mean lawful money of the United States.

“Eligible Assignee” has the meaning specified in Section 10.06(g).

“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

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“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower, or its Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“ERISA” means the Employee Retirement Income Security Act of 1974.

“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (f) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate; or (g) the application for a waiver of the minimum funding standard under the Pension Funding Rules, a copy of such application.

“Eurodollar Bid Margin” means the margin above or below the Eurodollar Rate to be added to or subtracted from the Eurodollar Rate, which margin shall be expressed in multiples of 1/100^th of one basis point.

“Eurodollar Margin Bid Loan” means a Bid Loan that bears interest at a rate based upon the Eurodollar Rate.

“Eurodollar Rate” means:

(a) for any Interest Period with respect to a Eurodollar Rate Loan, the rate per annum equal to the London Interbank Offered Rate (“LIBOR”) or a comparable or successor rate, which rate is approved by the Administrative Agent, as published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period; and

(b) for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to LIBOR, at or about 11:00 a.m., London time determined two Business Days prior to such date for Dollar deposits with a term of one month commencing that day;

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provided that to the extent a comparable or successor rate is approved by the Administrative Agent in connection herewith, the approved rate shall be applied in a manner consistent with market practice for LIBOR-based loans; provided, further that to the extent such market practice is not administratively feasible for the Administrative Agent, such approved rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent.

“Eurodollar Rate Committed Loan” means a Committed Loan that bears interest at a rate based on clause (a) of the definition of Eurodollar Rate.

“Eurodollar Rate Loan” means a Eurodollar Rate Committed Loan or a Eurodollar Margin Bid Loan.

“Event of Default” has the meaning specified in Section 8.01.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to the Administrative Agent, any Lender or any L/C Issuer or required to be withheld or deducted from a payment to the Administrative Agent, such Lender or such L/C Issuer: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of the Administrative Agent, such Lender or such L/C Issuer being organized under the laws of, or having its principal office or, in the case of any Lender, its Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 10.14) or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to Section 3.01(a)(ii), (a)(iii) or (c) amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to the Administrative Agent’s, such Lender’s or such L/C Issuer’s failure to comply with Section 3.01(e) and (d) any U.S. federal withholding Taxes imposed pursuant to FATCA.

“Execution Date” means the date upon which this Agreement has been executed by all parties hereto and all conditions precedent set forth in Section 4.01 have been satisfied or waived in accordance with the terms and conditions of Section 10.01 (or, in the case of Section 4.01(c) waived by the Person entitled to receive the applicable payment).

“Facility Fee” has the meaning set forth in Section 2.10(a).

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions most closely resembling such overnight Federal funds transactions as reasonably determined by the Administrative Agent.

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“Fee Letters” means (i) the letter agreement dated December 3, 2013, among the Borrower, the Administrative Agent, and Merrill Lynch Pierce Fenner & Smith Incorporated, and (ii) the letter agreement dated December 3, 2013, among the Borrower, J.P. Morgan Securities LLC, JPMorgan Chase Bank N.A., RBS Securities Inc., and The Royal Bank of Scotland plc.

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

“FRB” means the Board of Governors of the Federal Reserve System of the United States.

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to any L/C Issuer, such Defaulting Lender’s Pro Rata Share of the outstanding L/C Obligations with respect to Letters of Credit issued by such L/C Issuer other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to the Swing Line Lender, such Defaulting Lender’s Pro Rata Share of outstanding Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders pursuant to Section 2.17 or Cash Collateralized in accordance with the terms hereof.

“Fund” has the meaning specified in Section 10.06(g).

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

“Governmental Authority” means any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Granting Lender” has the meaning specified in Section 10.06(i).

“Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of

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such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person. The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hybrid Securities” means any trust preferred securities, or deferrable interest subordinated debt with a maturity of at least 20 years, which provides for the optional or mandatory deferral of interest or distributions, issued by the Borrower, or any business trusts, limited liability companies, limited partnerships or similar entities (i) substantially all of the common equity, general partner or similar interests of which are owned (either directly or indirectly through one or more wholly-owned Subsidiaries) at all times by the Borrower or any of the Subsidiaries, (ii) that have been formed for the purpose of issuing trust preferred securities or deferrable interest subordinated debt, and (iii) substantially all the assets of which consist of (A) subordinated debt of the Borrower or a Subsidiary, and (B) payments made from time to time on the subordinated debt.

“Hydrocarbon Interests” means all rights, titles, interests and estates now owned or hereafter acquired by the Borrower or any of its Subsidiaries in any and all oil, gas and other liquid or gaseous hydrocarbon properties and interests, including without limitation, mineral fee or lease interests, production sharing agreements, concession agreements, license agreements, service agreements, risk service agreements or similar Hydrocarbon interests granted by an appropriate Governmental Authority, farmout, overriding royalty and royalty interests, net profit interests, oil payments, production payment interests and similar interests in Hydrocarbons, including any reserved or residual interests of whatever nature.

“Hydrocarbons” means oil, gas, casing head gas, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons, all products refined, separated, settled and dehydrated therefrom, including, without limitation, kerosene, liquefied petroleum gas, refined lubricating oils, diesel fuel, drip gasoline, natural gasoline, helium, sulfur and all other minerals.

“Immaterial Subsidiary” on any date shall mean any Subsidiary of the Borrower that (a) does not have, as of such date, assets with a value in excess of 5.0% of total assets of the Borrower and its Subsidiaries, and did not, as of the last day of the fiscal quarter of the Borrower most recently ended, have revenues representing in excess of 5.0% of total revenues of the Borrower and its Subsidiaries, in each case, on a consolidated basis, and (b) taken together with all Immaterial Subsidiaries does not have, as of such date, assets with a value in excess of 5.0% of total assets of the Borrower and its Subsidiaries, and as of the last day of the fiscal quarter of the Borrower most recently ended, did not have revenues representing in excess of 5.0% of total revenues of the Borrower and its Subsidiaries, in each case, on a consolidated basis.

“Indebtedness” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

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(b) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments;

(c) net obligations of such Person under any Swap Contract;

(d) all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business);

(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(f) Capital Lease Obligations and Synthetic Lease Obligations;

(g) Off-Balance Sheet Liabilities;

(h) Guarantees of such Person in respect of any of the foregoing; and

(i) Hybrid Securities.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Indemnitee” has the meaning set forth in Section 10.04(b).

“Initial Financial Statements” means the financial statements of ONE Gas Predecessor (as defined in the Registration Statement) and of the Borrower, all as set forth in the Registration Statement.

“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan (including a Swing Line Loan), the last Business Day of each March, June, September and December and the Maturity Date.

“Interest Period” means (a) as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or (in the case of any Eurodollar Rate Committed Loan) converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months (in each case, subject to availability) thereafter, as selected by the Borrower in its Committed Loan Notice or Bid Request, as the case may be; and (b) as to each Absolute Rate Loan, a period of not less than 14 days and not more than 180 days as selected by the Borrower in its Bid Request; provided that:

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(i) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless, in the case of a Eurodollar Rate Loan, such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

(ii) any Interest Period pertaining to a Eurodollar Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

(iii) no Interest Period shall extend beyond the Maturity Date.

“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

“IRS” means the United States Internal Revenue Service.

“ISP” has the meaning set forth in Section 2.04(h).

“Issuer Documents” means with respect to any Letter of Credit, the Letter Credit Application, and any other document, agreement and instrument entered into by any L/C Issuer and the Borrower (or any Subsidiary) or in favor any L/C Issuer and relating to any such Letter of Credit.

“Laws” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Pro Rata Share.

“L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date required to be reimbursed pursuant to Section 2.04(c)(i) or refinanced as a Committed Borrowing on or before such date.

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the renewal or increase of the amount thereof.

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“L/C Issuer” means each of Bank of America, JPMorgan Chase Bank, N.A. and The Royal Bank of Scotland plc, in its capacity as issuer of Letters of Credit hereunder, and any additional Lender approved by the Administrative Agent and the Borrower that has agreed to act as an “L/C Issuer”, and any successor issuer of Letters of Credit hereunder. As used herein, the term “the L/C Issuer” shall mean “each L/C Issuer” or, if such term is used with reference to one or more Letters of Credit, shall mean, with respect to each such Letter of Credit, “the applicable L/C Issuer.”

“L/C Issuer Commitment” means (a) with respect to each of Bank of America, JPMorgan Chase Bank, N.A. and The Royal Bank of Scotland plc, $16,666,667, or, with respect to any such L/C Issuer (x) such greater amount (not to exceed, when added to the L/C Issuer Commitments of all other L/C Issuers, the Letter of Credit Sublimit) as shall be agreed from time to time in writing by the Borrower, such L/C Issuer and the Administrative Agent or (y) such lesser amount as shall be agreed from time to time in writing by the Borrower, all L/C Issuers and the Administrative Agent, and (b) with respect to any Lender which agrees to be a L/C Issuer after the Closing Date, the amount (not to exceed, when added to the L/C Issuer Commitments of all other L/C Issuers, the Letter of Credit Sublimit) agreed in writing from time to time by such L/C Issuer, the Borrower and the Administrative Agent.

“L/C Obligations” means, as at any date of determination, the aggregate undrawn amount of all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP or applicable law, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“Left Lead Arranger” means Merrill Lynch, Pierce, Fenner & Smith Incorporated.

“Lender” has the meaning specified in the introductory paragraph hereto and, as the context requires, includes the L/C Issuers and the Swing Line Lender.

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.

“Letter of Credit” means any standby letter of credit issued hereunder.

“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by any L/C Issuer.

“Letter of Credit Expiration Date” means, with respect to each L/C Issuer and each Letter of Credit issued by such L/C Issuer, the day that is seven days prior to the later of (a) the initial Maturity Date and (b) such extended Maturity Date as to which such L/C Issuer has agreed in accordance with the Borrower’s exercise of the extension option pursuant to Section 2.15 (or, if such day is not a Business Day, the next preceding Business Day).

“Letter of Credit Fee” has the meaning set forth in Section 2.04(i).

“Letter of Credit Sublimit” means an amount equal to $50,000,000. The Letter of Credit Sublimit is part of, and not in addition to, the Aggregate Commitments.

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“Lien” means any mortgage, pledge, hypothecation, assignment for security, deposit arrangement, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, and any financing lease having substantially the same economic effect as any of the foregoing).

“Loan” means an extension of credit by a Lender to the Borrower under Article II in the form of a Committed Loan, a Bid Loan or a Swing Line Loan.

“Loan Documents” means this Agreement, any amendment hereto, each Note, each Issuer Document, any agreement creating or perfecting rights in Cash Collateral pursuant to the provisions of Section 2.04 of this Agreement, and each Fee Letter.

“Loan Notice” means a notice of (a) a Borrowing, (b) a conversion of Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

“Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the operations, properties or financial condition of the Borrower and its Subsidiaries taken as a whole; provided however, (i) a downgrade by S&P and/or Moody’s of their respective Debt Rating shall not, in and of itself, be deemed to be a Material Adverse Effect, and (ii) the fact that the Borrower is unable to borrow in the commercial paper market shall not, in and of itself, be deemed to be a Material Adverse Effect; but for purposes of clarity in interpreting the foregoing clauses (i) and (ii), it is agreed that the event(s), change(s), circumstance(s) or condition(s) that causes such downgrade (or an announcement of a potential downgrade or a review for possible ratings change) of the Debt Rating or that causes such inability of the Borrower to borrow in the commercial paper market, and the effect or change caused by such downgrade (or an announcement of a potential downgrade or a review for possible ratings change) of the Debt Rating or by such inability to borrow, will be considered in determining whether there has been a Material Adverse Effect; (b) a material impairment of the ability of the Borrower to perform its payment obligations, under any Loan Document to which it is a party; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against the Borrower of any Loan Document to which it is a party.

“Material Agreement” means any agreement a copy of which is an Exhibit to the Registration Statement as in effect on the date of consummation of the ONE Gas Separation Transactions.

“Maturity Date” means the later of (a) the fifth anniversary of the Closing Date; and (b) for any Lender as to which maturity is extended pursuant to Section 2.15, such extended maturity date as determined pursuant to such Section; provided, however, that, in each case, if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

“Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

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“Non-Extending Lender” has the meaning set forth in Section 2.15(b).

“Note” means a promissory note made by the Borrower in favor of a Lender evidencing Loans made by such Lender, substantially in the form of Exhibit D.

“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, the Borrower arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against the Borrower or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“Off-Balance Sheet Liabilities” means, with respect to the Borrower as of any date of determination thereof, without duplication and to the extent not included as a liability on the consolidated balance sheet of the Borrower and its Subsidiaries in accordance with GAAP: (a) with respect to any asset securitization transaction (including any accounts receivable purchase facility) (i) the unrecovered investment of purchasers or transferees of assets so transferred and (ii) any other payment, recourse, repurchase, hold harmless, indemnity or similar obligation of the Borrower or any of its Subsidiaries in respect of assets transferred or payments made in respect thereof, other than limited recourse provisions that are customary for transactions of such type and that neither (x) have the effect of limiting the loss or credit risk of such purchasers or transferees with respect to payment or performance by the obligors of the assets so transferred nor (y) impair the characterization of the transaction as a true sale under applicable Laws (including Debtor Relief Laws); (b) any Synthetic Lease Obligation; (c) the monetary obligations under any sale and leaseback transaction which does not create a liability on the consolidated balance sheet of the Borrower and its Subsidiaries, provided that Off-Balance Sheet Liabilities of the Borrower and its Subsidiaries shall not include the existing sale and leaseback transactions described on Schedule 1.01A provided that the documents governing such transactions are not amended after the Closing Date so as to increase the amount of the Borrower’s or its Subsidiaries’ total payment obligations thereunder; or (d) any other monetary obligation arising with respect to any other transaction which (i) upon the application of any Debtor Relief Law to the Borrower or any of its Subsidiaries, would be characterized as indebtedness or (ii) is the functional equivalent of or takes the place of borrowing but which, in each such case does not constitute a liability on the consolidated balance sheet of the Borrower and its Subsidiaries (for purposes of this clause (d), any transaction structured to provide tax deductibility as interest expense of any dividend, coupon or other periodic payment will be deemed to be the functional equivalent of a borrowing).

“Oil and Gas Agreements” means operating agreements, processing agreements, farm-out and farm-in agreements, development agreements, area of mutual interest agreements, contracts for the gathering and/or transportation of oil and natural gas, unitization agreements, pooling arrangements, joint bidding agreements, joint venture agreements, participation agreements, surface use agreements, service contracts, leases and subleases of Oil and Gas Properties or other similar agreements which are customary in the oil and gas business, howsoever designated, in each case made or entered into in the ordinary course of the oil and gas business as conducted by the Borrower and its Subsidiaries.

“Oil and Gas Properties” means (a) Hydrocarbon Interests; (b) the Property now or hereafter pooled or unitized with Hydrocarbon Interests; (c) all presently existing or future unitization, pooling agreements and declarations of pooled units and the units created thereby (including, without limitation,

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all units created under orders, regulations and rules of any Governmental Authority) which may affect all or any portion of the Hydrocarbon Interests; (d) all operating agreements, contracts and other agreements which relate to any of the Hydrocarbon Interests or the production, sale, purchase, exchange or processing of Hydrocarbons from or attributable to such Hydrocarbon Interest; (e) all Hydrocarbons in and under and which may be produced and saved or attributable to the Hydrocarbon Interests, the lands covered thereby and all oil in tanks and all rents, issues, profits, proceeds, products, revenues and other income from or attributable to the Hydrocarbon Interests; and (f) all tenements, hereditaments, appurtenances and property in any manner appertaining, belonging, affixed or incidental to the Hydrocarbon Interests, and any and all property, now owned or hereinafter acquired and situated upon, used, held for use or useful in connection with the operating, working or development of any of such Hydrocarbon Interests or property (excluding drilling rigs, automotive equipment or other personal property which may be on such premises for the purpose of drilling a well or for other similar temporary uses) and including any and all oil wells, gas wells, injection wells or other wells, buildings, structures, fuel separators, liquid extraction plants, plant compressors, pumps, pumping units, field gathering systems, tanks and tank batteries, fixtures, valves, fittings, machinery and parts, engines, boilers, meters, apparatus, equipment, appliances, tools, implements, cables, wires, towers, casing, tubing and rods, surface leases, rights-of-way, easements and servitudes together with all additions, substitutions, replacements, accessions and attachments to any and all of the foregoing.

“ONE Gas Contribution” means the transfer by ONEOK and its subsidiaries to the Borrower and its subsidiaries of ONEOK’s natural gas distribution business substantially as described in the Registration Statement.

“ONE Gas Distribution” means the dividend of the Borrower’s common stock substantially as described in the Registration Statement.

“ONE Gas Separation Transactions” means the ONE Gas Contribution and the ONE Gas Distribution.

“ONEOK” means ONEOK, Inc., an Oklahoma corporation.

“Organization Documents” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“Other Connection Taxes” means, with respect to the Administrative Agent, any Lender or any L/C Issuer, Taxes imposed as a result of a present or former connection between the Administrative Agent, such Lender or such L/C Issuer and the jurisdiction imposing such Tax (other than connections arising from the Administrative Agent, such Lender or such L/C Issuer having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

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“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under or from the execution, delivery, performance, enforcement or registration of, or from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.06).

“Outstanding Amount” means (i) with respect to Committed Loans, Bid Loans and Swing Line Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Committed Loans, Bid Loans and Swing Line Loans, as the case may be, occurring on such date; and (ii) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements of outstanding unpaid drawings under any Letters of Credit or any reductions in the maximum amount available for drawing under Letters of Credit taking effect on such date.

“Participant” has the meaning specified in Section 10.06(d).

“Participant Register” has the meaning specified in Section 10.06(d).

“PBGC” means the Pension Benefit Guaranty Corporation.

“Pension Act” means the Pension Protection Act of 2006.

“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and set forth in, with respect to plan years ending prior to the effective date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

“Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA) established by the Borrower or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, that is maintained, or contributed to, by the Borrower or any ERISA Affiliate.

“Platform” has the meaning set forth in Section 6.02.

“Pro Rata Share” means, with respect to each Lender at any time, a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the amount of the Commitment of such Lender at such time and the denominator of which is the amount of the Aggregate Commitments at such time, subject to adjustment as provided in Section 2.17; provided that if the commitment of each Lender to make Loans and the obligation of each L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02 or has otherwise expired, then the Pro Rata Share of each Lender shall be determined based on the Pro Rata Share of such Lender immediately prior

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to such termination and after giving effect to any subsequent assignments made pursuant to the terms hereof. The initial Pro Rata Share of each Lender is set forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“Register” has the meaning set forth in Section 10.06(c).

“Registration Statement” means the Borrower’s Registration Statement on Form 10 filed with the SEC on October 1, 2013, as amended by that certain Amendment No. 1 to Form 10 filed with the SEC on November 21, 2013, together with all exhibits, as amended, supplemented or otherwise modified by Acceptable Changes.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

“Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day notice period has been waived.

“Request for Credit Extension” means (a) with respect to a Borrowing, conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with respect to a Bid Loan, a Bid Request, (c) with respect to an L/C Credit Extension, a Letter of Credit Application, and (d) with respect to a Swing Line Loan, a Swing Line Loan Notice.

“Required Lenders” means, as of any date of determination, Lenders having more than 50% of the Aggregate Commitments or, if the commitment of each Lender to make Loans and the obligation of each L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02, Lenders holding in the aggregate more than 50% of the Total Outstandings (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Total Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

“Responsible Officer” means the chief executive officer, president, vice president with responsibility for financial matters, chief financial officer, treasurer or assistant treasurer of the Borrower. Any document delivered hereunder that is signed by a Responsible Officer of the Borrower shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of the Borrower and such Responsible Officer shall be conclusively presumed to have acted on behalf of the Borrower.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.

“Sanction(s)” means any international economic sanction administered or enforced by the United States Government, including without limitation, OFAC, the United Nations Security Council, the European Union, Her Majesty’s Treasury or other relevant sanctions authority.

“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

“SPC” has the meaning specified in Section 10.06(i).

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“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Borrower.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options (excluding stock options granted to directors, employees, management, and consultants), bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section 2.05.

“Swing Line Lender” means Bank of America in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder.

“Swing Line Loan” has the meaning specified in Section 2.05(a).

“Swing Line Loan Notice” means a notice of a Swing Line Borrowing pursuant to Section 2.05(b), which, if in writing, shall be substantially in the form of Exhibit C.

“Swing Line Sublimit” means an amount equal to the lesser of (a) $100,000,000 and (b) the Aggregate Commitments, or such lesser amount as agreed by the Borrower and the Swing Line Lender. The Swing Line Sublimit is part of, and not in addition to, the Aggregate Commitments.

“Syndication Agent” means the entity named as Syndication Agent on the cover page of this Agreement.

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“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Threshold Amount” means $100,000,000.

“Total Capital” means, at any time, the sum of (a) Consolidated Total Indebtedness and (b) Consolidated Net Worth.

“Total Outstandings” means the aggregate Outstanding Amount of all Loans and all L/C Obligations.

“Type” means (a) with respect to a Committed Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan, and (b) with respect to a Bid Loan, its character as an Absolute Rate Loan or a Eurodollar Margin Bid Loan.

“Unfunded Pension Liability” means the amount (if any) by which the present value of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, determined using actuarial assumptions for funding purposes which are equal to the assumptions used by the Pension Plan’s actuary for funding said Pension Plan pursuant to Section 412 of the Code for the applicable plan year, exceeds the current fair market value of such Pension Plan’s assets.

“United States” and “U.S.” mean the United States of America.

“Unreimbursed Amount” has the meaning set forth in Section 2.04(c)(i).

“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.

“U.S. Tax Compliance Certificate” has the meaning specified in Section 3.01(e)(ii)(B)(3).

“Year-End 2013 Financial Statements” means unaudited pro forma financial statements of the Borrower and ONE Gas Predecessor Business, consisting of (a) unaudited pro forma statement of income for the twelve-month period ended December 31, 2013, prepared as though the ONE Gas Separation Transactions occurred on January 1, 2013, and (b) unaudited pro forma balance sheet as of December 31, 2013, prepared as though the ONE Gas Separation Transactions occurred on December 31, 2013.

1.02 Other Interpretive Provisions. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a) The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.

(b)           (i) The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in any Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof.

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(ii) Article, Section, Exhibit and Schedule references are to the Loan Document in which such reference appears.

(iii) The words “include,” “includes” and “including” are by way of example and not limitation.

(iv) The term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form.

(v) The words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

(c) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”

(d) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

1.03 Accounting Terms.

(a) All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP as in effect from time to time. Notwithstanding the foregoing, for purposes of determining compliance with any covenant (including the computation of any financial covenant) contained herein, Indebtedness of the Borrower and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall be disregarded.

(b) If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein until such time, if any, as such financial ratio or requirement are adjusted or reset to reflect such changes in GAAP and such adjustments or resets are agreed to in writing by the Borrower, the Administrative Agent and the Required Lenders.

1.04 Rounding. Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

1.05 References to Agreements and Laws. Unless otherwise expressly provided herein, (a) references to Organization Documents, agreements (including the Loan Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan Document; and (b) references to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Law.

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1.06 Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Central time (daylight or standard, as applicable).

1.07 Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS

2.01 Committed Loans. Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans (each such loan, a “Committed Loan”) to the Borrower from time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided, however, that after giving effect to any Committed Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment. Within the limits of each Lender’s Commitment, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay under Section 2.06, and reborrow under this Section 2.01. Committed Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein.

2.02 Borrowings, Conversions and Continuations of Loans.

(a) Each Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Eurodollar Rate Committed Loans shall be made upon the Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone. Each such notice must be received by the Administrative Agent not later than 10:00 a.m. (i) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans or of any conversion of Eurodollar Rate Committed Loans to Base Rate Committed Loans, and (ii) on the requested date of any Borrowing of Base Rate Committed Loans. Each telephonic notice by the Borrower pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Committed Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower. Each Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Except as provided in Sections 2.04(c) and 2.05(c), each Borrowing of or conversion to Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a Committed Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation of Eurodollar Rate Committed Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to be borrowed, converted or continued, (iv) the Type of Committed Loans to be borrowed or to which existing Committed Loans are to be converted, and (v) if applicable, the duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type of Committed Loan in a Committed Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Committed Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect

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with respect to the applicable Eurodollar Rate Committed Loans. If the Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Committed Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.

(b) Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender of the amount of its Pro Rata Share of the applicable Committed Loans, and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans described in the preceding subsection. In the case of a Committed Borrowing, each Lender shall make the amount of its Committed Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the Business Day specified in the applicable Committed Loan Notice. Upon satisfaction of the applicable conditions set forth in Section 4.03 (and, if such Borrowing is the initial Credit Extension, Section 4.02), the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower; provided, however, that if, on the date the Committed Loan Notice with respect to such Borrowing is given by the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing shall be applied, first, to the payment in full of any such L/C Borrowings and second, to the Borrower as provided above.

(c) Except as otherwise provided herein, a Eurodollar Rate Committed Loan may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Committed Loan. During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Committed Loans without the consent of the Required Lenders.

(d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Committed Loans upon determination of such interest rate. The determination of the Eurodollar Rate by the Administrative Agent shall be conclusive in the absence of manifest error. At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

(e) After giving effect to all Committed Borrowings, all conversions of Committed Loans from one Type to the other, and all continuations of Committed Loans as the same Type, there shall not be more than six Interest Periods in effect with respect to Committed Loans.

2.03 Bid Loans.

(a) General. Subject to the terms and conditions set forth herein, each Lender agrees that the Borrower may from time to time request the Lenders to submit offers to make loans (each such loan, a “Bid Loan”) to the Borrower prior to the Maturity Date pursuant to this Section 2.03; provided, however, that after giving effect to any Bid Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of all Bid Loans shall not exceed the Bid Loan Sublimit. There shall not be more than six different Interest Periods in effect with respect to Bid Loans at any time.

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(b) Requesting Competitive Bids. The Borrower may request the submission of Competitive Bids by delivering a Bid Request to the Administrative Agent not later than 12:00 noon (i) one Business Day prior to the requested date of any Bid Borrowing that is to consist of Absolute Rate Loans, or (ii) four Business Days prior to the requested date of any Bid Borrowing that is to consist of Eurodollar Margin Bid Loans. Each Bid Request shall specify (i) the requested date of the Bid Borrowing (which shall be a Business Day), (ii) the aggregate principal amount of Bid Loans requested (which must be $10,000,000 or a whole multiple of $1,000,000 in excess thereof), (iii) the Type of Bid Loans requested, and (iv) the duration of the Interest Period with respect thereto, and shall be signed by a Responsible Officer of the Borrower. No Bid Request shall contain a request for (i) more than one Type of Bid Loan or (ii) Bid Loans having more than three different Interest Periods. Unless the Administrative Agent otherwise agrees in its sole and absolute discretion, the Borrower may not submit a Bid Request if it has submitted another Bid Request within the prior five Business Days.

(c) Submitting Competitive Bids.

(i) The Administrative Agent shall promptly notify each Lender of each Bid Request received by it from the Borrower and the contents of such Bid Request.

(ii) Each Lender may (but shall have no obligation to) submit a Competitive Bid containing an offer to make one or more Bid Loans in response to such Bid Request. Such Competitive Bid must be delivered to the Administrative Agent not later than 10:30 a.m. (A) on the requested date of any Bid Borrowing that is to consist of Absolute Rate Loans, and (B) three Business Days prior to the requested date of any Bid Borrowing that is to consist of Eurodollar Margin Bid Loans; provided, however, that any Competitive Bid submitted by Bank of America in its capacity as a Lender in response to any Bid Request must be submitted to the Administrative Agent not later than 10:15 a.m. on the date on which Competitive Bids are required to be delivered by the other Lenders in response to such Bid Request. Each Competitive Bid shall specify (A) the proposed date of the Bid Borrowing; (B) the principal amount of each Bid Loan for which such Competitive Bid is being made, which principal amount (x) may be equal to, greater than or less than the Commitment of the bidding Lender, (y) must be $5,000,000 or a whole multiple of $1,000,000 in excess thereof, and (z) may not exceed the principal amount of Bid Loans for which Competitive Bids were requested; (C) if the proposed Bid Borrowing is to consist of Absolute Rate Bid Loans, the Absolute Rate offered for each such Bid Loan and the Interest Period applicable thereto; (D) if the proposed Bid Borrowing is to consist of Eurodollar Margin Bid Loans, the Eurodollar Bid Margin with respect to each such Eurodollar Margin Bid Loan and the Interest Period applicable thereto; and (E) the identity of the bidding Lender.

(iii) Any Competitive Bid shall be disregarded if it (A) is received after the applicable time specified in clause (ii) above, (B) is not substantially in the form of a Competitive Bid as specified herein, (C) contains qualifying, conditional or similar language, (D) proposes terms other than or in addition to those set forth in the applicable Bid Request, or (E) is otherwise not responsive to such Bid Request. Any Lender may correct a Competitive Bid containing a manifest error by submitting a corrected Competitive Bid (identified as such) not later than the applicable time required for submission of Competitive Bids. Any such submission of a corrected Competitive Bid shall constitute a revocation of the Competitive Bid that contained the manifest error. The Administrative Agent may, but shall not be required to, notify any Lender of any manifest error it detects in such Lender’s Competitive Bid.

(iv) Subject only to the provisions of Sections 3.02, 3.03 and 4.03 and clause (iii) above, each Competitive Bid shall be irrevocable.

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(d) Notice to Borrower of Competitive Bids. Not later than 11:00 a.m. (i) on the requested date of any Bid Borrowing that is to consist of Absolute Rate Loans, or (ii) three Business Days prior to the requested date of any Bid Borrowing that is to consist of Eurodollar Margin Bid Loans, the Administrative Agent shall notify the Borrower of the identity of each Lender that has submitted a Competitive Bid that complies with Section 2.03(c) and of the terms of the offers contained in each such Competitive Bid.

(e) Acceptance of Competitive Bids. Not later than 11:30 a.m. (i) on the requested date of any Bid Borrowing that is to consist of Absolute Rate Loans, and (ii) three Business Days prior to the requested date of any Bid Borrowing that is to consist of Eurodollar Margin Bid Loans, the Borrower shall notify the Administrative Agent of its acceptance or rejection of the offers notified to it pursuant to Section 2.03(d). The Borrower shall be under no obligation to accept any Competitive Bid and may choose to reject all Competitive Bids. In the case of acceptance, such notice shall specify the aggregate principal amount of Competitive Bids for each Interest Period that is accepted. The Borrower may accept any Competitive Bid in whole or in part; provided that:

(i) the aggregate principal amount of each Bid Borrowing may not exceed the applicable amount set forth in the related Bid Request;

(ii) the principal amount of each Bid Loan must be $5,000,000 or a whole multiple of $1,000,000 in excess thereof;

(iii) the acceptance of offers may be made only on the basis of ascending Absolute Rates or Eurodollar Bid Margins within each Interest Period; and

(iv) the Borrower may not accept any offer that is described in Section 2.03(c)(iii) or that otherwise fails to comply with the requirements hereof.

(f) Procedure for Identical Bids. If two or more Lenders have submitted Competitive Bids at the same Absolute Rate or Eurodollar Bid Margin, as the case may be, for the same Interest Period, and the result of accepting all of such Competitive Bids in whole (together with any other Competitive Bids at lower Absolute Rates or Eurodollar Bid Margins, as the case may be, accepted for such Interest Period in conformity with the requirements of Section 2.03(e)(iii)) would be to cause the aggregate outstanding principal amount of the applicable Bid Borrowing to exceed the amount specified therefor in the related Bid Request, then, unless otherwise agreed by the Borrower, the Administrative Agent and such Lenders, such Competitive Bids shall be accepted as nearly as possible in proportion to the amount offered by each such Lender in respect of such Interest Period, with such accepted amounts being rounded to the nearest whole multiple of $1,000,000.

(g) Notice to Lenders of Acceptance or Rejection of Bids. The Administrative Agent shall promptly notify each Lender having submitted a Competitive Bid whether or not its offer has been accepted and, if its offer has been accepted, of the amount of the Bid Loan or Bid Loans to be made by it on the date of the applicable Bid Borrowing. Any Competitive Bid or portion thereof that is not accepted by the Borrower by the applicable time specified in Section 2.03(e) shall be deemed rejected.

(h) Notice of Eurodollar Rate. If any Bid Borrowing is to consist of Eurodollar Margin Bid Loans, the Administrative Agent shall determine the Eurodollar Rate for the relevant Interest Period, and promptly after making such determination, shall notify the Borrower and the Lenders that will be participating in such Bid Borrowing of such Eurodollar Rate.

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(i) Funding of Bid Loans. Each Lender that has received notice pursuant to Section 2.03(g) that all or a portion of its Competitive Bid has been accepted by the Borrower shall make the amount of its Bid Loan(s) available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the date of the requested Bid Borrowing. Upon satisfaction of the applicable conditions set forth in Section 4.03, the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent.

(j) Notice of Range of Bids. After each Competitive Bid auction pursuant to this Section 2.03, the Administrative Agent shall notify each Lender that submitted a Competitive Bid in such auction of the ranges of bids submitted (without the bidder’s name) and accepted for each Bid Loan and the aggregate amount of each Bid Borrowing.

2.04 Letters of Credit.

(a) The Letter of Credit Commitment.

(i) Subject to the terms and conditions set forth herein, (A) each L/C Issuer agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.04, (1) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of the Borrower and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drawings under the Letters of Credit; and (B) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower or its Subsidiaries and any drawings thereunder; provided that after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (w) the Total Outstandings shall not exceed the Aggregate Commitments, (x) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, (y) the Outstanding Amount of all L/C Obligations shall not exceed the Letter of Credit Sublimit, and (z) the Outstanding Amount of the L/C Obligations with respect to Letters of Credit issued by such L/C Issuer shall not exceed such L/C Issuer’s L/C Issuer Commitment (unless such L/C Issuer consents to having the Outstanding Amounts of the L/C Obligations with respect to Letters of Credit issued by such L/C Issuer exceed such L/C Issuer’s L/C Issuer Commitment). Each request by the Borrower for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the Borrower that the L/C Credit Extension so requested complies with the conditions set forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed. All Letters of Credit shall be standby letters of credit issued to support the payment or performance obligations of the Borrower or its Subsidiaries.

(ii) No L/C Issuer shall issue any Letter of Credit, if:

(A) subject to Section 2.04(b)(iii), the expiry date of the requested Letter of Credit would occur more than twelve months after the date of issuance or last extension, unless such L/C Issuer has approved such expiry date; or

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(B) the expiry date of the requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless all Lenders have approved such expiry date.

(iii) No L/C Issuer shall be under any obligation to issue any Letter of Credit if:

(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such L/C Issuer from issuing such Letter of Credit, or any Law applicable to such L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or request that such L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which such L/C Issuer in good faith deems material to it;

(B) the expiry date of such requested Letter of Credit would occur after any Maturity Date applicable to any Non-Extending Lender, unless the amount of such Letter of Credit together with all other L/C Obligations outstanding on the date of issuance of such Letter of Credit is equal to or less than the aggregate Commitments of all Lenders who shall remain parties to this Agreement subsequent to the Maturity Date that immediately precedes the expiry date of such Letter of Credit;

(C) the issuance of such Letter of Credit would violate one or more policies of such L/C Issuer, or such Letter of Credit is in an initial stated amount less than $500,000 or is to be denominated in a currency other than Dollars; or

(D) any Lender is at that time a Defaulting Lender, unless (x) such L/C Issuer has entered into arrangements, including the delivery of Cash Collateral, reasonably satisfactory to such L/C Issuer with the Borrower or such Lender to eliminate such L/C Issuer’s Fronting Exposure with respect to the Defaulting Lender as provided in Section 2.17(c) or (y) such Defaulting Lender’s participation in L/C Obligations has been reallocated among Non-Defaulting Lenders under Section 2.17.

(iv) Such L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

(v) Such L/C Issuer shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and such L/C Issuer shall have all of the benefits and immunities (A) provided to the Administrative Agent in Article IX with respect to any acts taken or omissions suffered by such L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article IX included such L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein with respect to such L/C Issuer.

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(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit.

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower delivered to the applicable L/C Issuer (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Borrower. Such Letter of Credit Application must be received by such L/C Issuer and the Administrative Agent not later than 11:00 a.m. at least two Business Days (or such later date and time as the applicable L/C Issuer may agree in a particular instance in its sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail reasonably satisfactory to such L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; and (G) such other matters as such L/C Issuer may require. In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to such L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of amendment thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D) such other matters as such L/C Issuer may require. Additionally, the Borrower shall furnish to such L/C Issuer and the Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as such L/C Issuer or the Administrative Agent may require to prepare, amend, or extend such Letter of Credit.

(ii) Promptly after receipt of any Letter of Credit Application, the applicable L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application from the Borrower and, if not, such L/C Issuer will provide the Administrative Agent with a copy thereof. Unless such L/C Issuer has received written notice from the Administrative Agent or the Borrower, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article IV shall not then be satisfied, then, subject to the terms and conditions hereof, such L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the Borrower or the applicable Subsidiary or enter into the applicable amendment, as the case may be, in each case in accordance with such L/C Issuer’s usual and customary business practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from such L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Pro Rata Share times the amount of such Letter of Credit.

(iii) If the Borrower so requests in any applicable Letter of Credit Application, the applicable L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit such L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by such

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L/C Issuer, the Borrower shall not be required to make a specific request to such L/C Issuer for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) such L/C Issuer to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided, however, that such L/C Issuer shall not permit any such extension if (A) such L/C Issuer has determined that it would not be permitted, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of clause (ii) of Section 2.04(a) or otherwise), or (B) it has received notice (which may be by telephone or in writing) on or before the day that is seven Business Days before the Non-Extension Notice Date from the Administrative Agent or the Borrower that one or more of the applicable conditions specified in Section 4.03 is not then satisfied, and in such case directing such L/C Issuer not to permit such extension.

(iv) If the Borrower so requests in any applicable Letter of Credit Application, the applicable L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that permits the automatic reinstatement of all or a portion of the stated amount thereof after any drawing thereunder (each, an “Auto-Reinstatement Letter of Credit”). Unless otherwise directed by such L/C Issuer, the Borrower shall not be required to make a specific request to such L/C Issuer to permit such reinstatement. Once an Auto-Reinstatement Letter of Credit has been issued, except as provided in the following sentence, the Lenders shall be deemed to have authorized (but may not require) such L/C Issuer to reinstate all or a portion of the stated amount thereof in accordance with the provisions of such Letter of Credit. Notwithstanding the foregoing, if such Auto-Reinstatement Letter of Credit permits such L/C Issuer to decline to reinstate all or any portion of the stated amount thereof after a drawing thereunder by giving notice of such non-reinstatement within a specified number of days after such drawing (the “Non-Reinstatement Deadline”), such L/C Issuer shall not permit such reinstatement if it has received a notice (which may be by telephone or in writing) on or before the day that is ten Business Days before the Non-Reinstatement Deadline from the Administrative Agent, any Lender or the Borrower that one or more of the applicable conditions specified in Section 4.03 is not then satisfied (treating such reinstatement as an L/C Credit Extension for purposes of this clause) and, in such case, directing such L/C Issuer not to permit such reinstatement.

(v) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, such L/C Issuer will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment.

(c) Drawings and Reimbursements; Funding of Participations.

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a compliant drawing under such Letter of Credit, the applicable L/C Issuer shall notify the Borrower and the Administrative Agent thereof. Not later than 11:00 a.m. on the Business Day following the date of any payment by such L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), the Borrower shall reimburse such L/C Issuer through the Administrative Agent, in an amount equal to the amount of such drawing. In the event that reimbursement is made on the Business Day after the Honor Date as permitted by this subsection (c)(i), interest shall be payable by the Borrower at the rate set forth in Section 2.09(a)(ii) on the amount of the drawing from the date on which the relevant draft is paid until the date on which such amount is either paid in full (by payment made by the Borrower or by a Borrowing of Base Rate Loans pursuant to this subsection (c)(i)) or is deemed to be

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an L/C Borrowing pursuant to Section 2.04(c)(iii). If the Borrower does not so reimburse such L/C Issuer by such time, the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such Lender’s Pro Rata Share thereof. In such event, the Borrower shall be deemed to have requested a Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date or the next Business Day thereafter in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of Base Rate Loans, but subject to the amount of the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 4.03 (other than the delivery of a Committed Loan Notice). Any notice given by such L/C Issuer or the Administrative Agent pursuant to this Section 2.04(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

(ii) Each Lender (including the Lender acting as a L/C Issuer) shall upon any notice pursuant to Section 2.04(c)(i) make funds available (and the Administrative Agent may apply Cash Collateral provided for this purpose pursuant to Section 2.04(g) as a result of a Defaulting Lender) for the account of such L/C Issuer at the Administrative Agent’s Office in an amount equal to its Pro Rata Share of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.04(c)(iii), each Lender that so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such amount. The Administrative Agent shall remit the funds so received to such L/C Issuer.

(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a Committed Borrowing of Base Rate Loans because the conditions set forth in Section 4.03 cannot be satisfied or for any other reason, the Borrower shall be deemed to have incurred from such L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate. In such event, each Lender’s payment to the Administrative Agent for the account of such L/C Issuer pursuant to Section 2.04(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.04.

(iv) Until each Lender funds its Committed Loan or L/C Advance pursuant to this Section 2.04(c) to reimburse any L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Pro Rata Share of such amount shall be solely for the account of such L/C Issuer.

(v) Each Lender’s obligation to make Committed Loans or L/C Advances to reimburse any L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.04(c), shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against such L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Committed Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in Section 4.03 (other than delivery by the Borrower of a Committed Loan Notice). No such making of an L/C Advance shall relieve or otherwise impair the obligation of the Borrower to reimburse such L/C Issuer for the amount of any payment made by such L/C Issuer under any Letter of Credit, together with interest as provided herein.

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(vi) If any Lender fails to make available to the Administrative Agent for the account of any L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.04(c) by the time specified in Section 2.04(c)(ii), such L/C Issuer shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to such L/C Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by such L/C Issuer in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by such L/C Issuer in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A certificate of such L/C Issuer submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.

(d) Repayment of Participations.

(i) At any time after any L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.04(c), if the Administrative Agent receives for the account of such L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to such Lender its Pro Rata Share thereof (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s L/C Advance was outstanding) in the same funds as those received by the Administrative Agent.

(ii) If any payment received by the Administrative Agent for the account of any L/C Issuer pursuant to Section 2.04(c)(i) is required to be returned under any of the circumstances described in Section 10.05 (including pursuant to any settlement entered into by such L/C Issuer in its discretion), each Lender shall pay to the Administrative Agent for the account of the L/C Issuer its Pro Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(e) Obligations Absolute. The obligation of the Borrower to reimburse the L/C Issuer for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other agreement or instrument relating thereto;

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(ii) the existence of any claim, counterclaim, set-off, defense or other right that the Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

(iv) any payment by the L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

(v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower.

The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notify the L/C Issuer. The Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents unless such notice is given as aforesaid.

(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying any drawing under a Letter of Credit, the L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. No L/C Issuer, the Administrative Agent, any of their respective Related Parties nor any of the correspondents, participants or assignees of any L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document. The Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. No L/C Issuer, the Administrative Agent, any of their respective Related Parties nor any of the correspondents, participants or assignees of any L/C Issuer shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.04(e); provided, however, that anything in such clauses to the contrary notwithstanding, the Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Borrower which were determined by a court of competent jurisdiction by final and nonappealable judgment to have been caused by the L/C Issuer’s willful misconduct or gross negligence or the L/C Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s)

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strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

(g) Cash Collateral. Upon the request of the Administrative Agent or any L/C Issuer (with a copy to the Administrative Agent) (i) if the L/C Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any Letter of Credit may for any reason remain outstanding and partially or wholly undrawn, the Borrower shall immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations in an amount equal to one hundred and two percent (102%) of such Outstanding Amount determined as of the date of such L/C Borrowing or the Letter of Credit Expiration Date, as the case may be. Sections 2.06, 2.15(f), and 8.02(c) set forth certain additional requirements to deliver Cash Collateral hereunder. If a Defaulting Lender fails to provide Cash Collateral within two Business Days of receiving a written request of the Administrative Agent or any L/C Issuer or the Swing Line Lender, then the Borrower shall provide such Cash Collateral within one Business Day of receiving written notice from the Administrative Agent or such L/C Issuer or the Swing Line Lender of the Defaulting Lender’s failure to provide such Cash Collateral. For purposes of this Agreement, “Cash Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the L/C Issuers and the Lenders, as collateral for the L/C Obligations, cash or deposit account balances pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the L/C Issuers (which documents are hereby consented to by the Lenders). Derivatives of such term have corresponding meanings. The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of the L/C Issuers and the Lenders, a first priority security interest in all such cash, deposit accounts and all balances therein and in all other property so provided as collateral pursuant to this Agreement, and in all proceeds of the foregoing, all as security for the obligations to which Cash Collateral may be applied. Cash collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America.

If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent as herein provided which has priority over the Administrative Agent’s claim, or that the total amount of such Cash Collateral is less than the amount required by this Section, Section 2.06 or 2.15(f), as applicable, the Borrower or the relevant Defaulting Lender will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency.

Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Agreement in respect of Letters of Credit or Swing Line Loans shall be held and applied to the satisfaction of the specific L/C Obligations, Swing Line Loans, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such property as may be provided for herein.

Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or other obligations shall be released promptly following (i) the elimination of the applicable Fronting Exposure or payment in full of all other obligations giving rise thereto (including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee following compliance with Section 10.06(b)(vi)); or (ii) the Administrative Agent’s determination that there exists excess Cash Collateral; provided, however, that Cash Collateral furnished by or on behalf of the Borrower shall not be released during the continuance of an Event of Default (and following application as provided in this Section 2.06, in Section 2.15(f) or Section 2.17, as applicable, may be otherwise applied in accordance with Section 8.03).

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(h) Applicability of ISP. Unless otherwise expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit is issued, the rules of the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance) (the “ISP”) shall apply to each Letter of Credit.

(i) Letter of Credit Fees. The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Pro Rata Share a Letter of Credit fee (the “Letter of Credit Fee”) for each Letter of Credit equal to the Applicable Rate times the daily maximum amount available to be drawn under such Letter of Credit; provided, however, any Letter of Credit Fees otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such Defaulting Lender has not provided Cash Collateral satisfactory to the L/C Issuer pursuant to this Section 2.04 shall be payable, to the maximum extent permitted by applicable Law, to the other Lenders in accordance with the upward adjustments in their respective Pro Rata Share allocable to such Letter of Credit pursuant to Section 2.17(a)(iv), with the balance of such fee, if any, payable to the L/C Issuer for its own account (unless Cash Collateral has been provided with respect to such Defaulting Lender’s participation in Letters of Credit). For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07. Such letter of credit fees shall be computed on a quarterly basis in arrears. Such letter of credit fees shall be due and payable on the first Business Day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. If there is any change in the Applicable Rate during any quarter, the daily maximum amount available to be drawn under each Letter of Credit shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect. Notwithstanding anything to the contrary contained herein, upon the request of the Required Lenders, while any Event of Default exists, all Letter of Credit Fees shall accrue at the Default Rate.

(j) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. The Borrower shall pay directly to the L/C Issuer for its own account a fronting fee with respect to each Letter of Credit, at the rate per annum specified in the applicable Fee Letter (or, with respect to any L/C Issuer who is not a party to a Fee Letter, at the rate per annum agreed between the Borrower and such L/C Issuer), computed on the daily amount available to be drawn under such Letter of Credit on a quarterly basis in arrears, and due and payable on the tenth Business Day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07. In addition, the Borrower shall pay directly to the L/C Issuer for its own account the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

(k) Conflict with Letter of Credit Application. In the event of any conflict between the terms hereof and the terms of any Letter of Credit Application, the terms hereof shall control.

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(l) Letter of Credit Issued for Subsidiaries. Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Subsidiary, the Borrower shall be obligated to reimburse the L/C Issuer hereunder for any and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the issuance of Letters of Credit for the account of Subsidiaries inures to the benefit of the Borrower, and that the Borrower’s business derives substantial benefits from the businesses of such Subsidiaries.

(m) L/C Issuer Reporting Requirements. Each L/C Issuer shall, no later than the last Business Day of each month, provide to the Administrative Agent a schedule of the Letters of Credit issued by it outstanding at any time during such month, such schedule to be in form and substance reasonably satisfactory to the Administrative Agent, showing the date of issuance of each such Letter of Credit, the account party, the original face amount, the current face amount (if any), the expiration date, and the reference number.

2.05 Swing Line Loans.

(a) The Swing Line. Subject to the terms and conditions set forth herein, the Swing Line Lender agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.05, to make loans (each such loan, a “Swing Line Loan”) to the Borrower from time to time on any Business Day during the Availability Period in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Pro Rata Share of the Outstanding Amount of Committed Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the amount of such Lender’s Commitment; provided, however, that after giving effect to any Swing Line Loan, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and provided, further, that the Swing Line Lender shall not be required to make any Swing Line Loan to refinance any outstanding Swing Line Loan. Within the foregoing limits, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.05, prepay under Section 2.06, and reborrow under this Section 2.05. Each Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Pro Rata Share times the amount of such Swing Line Loan.

(b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon the Borrower’s irrevocable notice to the Swing Line Lender and the Administrative Agent, which may be given by telephone. Each such notice must be received by the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $1,000,000, and (ii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to the Swing Line Lender and the Administrative Agent of a written Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower. Promptly after receipt by the Swing Line Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has also received such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof. Unless the Swing Line Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing the Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the first proviso to the first sentence of Section 2.05(a), or (B) that one or more of the applicable conditions specified in Article IV is not then satisfied, then, subject to the terms and conditions hereof, the Swing Line Lender will, not later than 3:00 p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Borrower at its office by crediting the account of the Borrower on the books of the Swing Line Lender in immediately available funds.

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(c) Refinancing of Swing Line Loans.

(i) The Swing Line Lender at any time in its sole and absolute discretion may request, on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line Lender to so request on its behalf), that each Lender make a Base Rate Committed Loan in an amount equal to such Lender’s Pro Rata Share of the amount of Swing Line Loans then outstanding. Such request shall be made in writing (which written request shall be deemed to be a Committed Loan Notice for purposes hereof) and in accordance with the requirements of Section 2.02, without regard to the minimum and multiples specified therein for the principal amount of Base Rate Loans, but subject to the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 4.03. The Swing Line Lender shall furnish the Borrower with a copy of the applicable Committed Loan Notice promptly after delivering such notice to the Administrative Agent. Each Lender shall make an amount equal to its Pro Rata Share of the amount specified in such Committed Loan Notice available to the Administrative Agent in immediately available funds (and the Administrative Agent may apply Cash Collateral provided for this purpose pursuant to Section 2.04(g) as a result of a Defaulting Lender) for the account of the Swing Line Lender at the Administrative Agent’s Office not later than 1:00 p.m. on the day specified in such Committed Loan Notice, whereupon, subject to Section 2.05(c)(ii), each Lender that so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such amount. The Administrative Agent shall remit the funds so received to the Swing Line Lender.

(ii) If for any reason any Swing Line Loan cannot be refinanced by such a Committed Borrowing in accordance with Section 2.05(c)(i), the request for Base Rate Committed Loans submitted by the Swing Line Lender as set forth herein shall be deemed to be a request by the Swing Line Lender that each of the Lenders fund its risk participation in the relevant Swing Line Loan and each Lender’s payment to the Administrative Agent for the account of the Swing Line Lender pursuant to Section 2.05(c)(i) shall be deemed payment in respect of such participation.

(iii) If any Lender fails to make available to the Administrative Agent for the account of the Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.05(c) by the time specified in Section 2.05(c)(i), the Swing Line Lender shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Swing Line Lender in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Swing Line Lender in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing or funded participation in the relevant Swing Line Loan, as the case may be. A certificate of the Swing Line Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

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(iv) Each Lender’s obligation to make Committed Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this Section 2.05(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Lender, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Committed Loans pursuant to this Section 2.05(c) is subject to the conditions set forth in Section 4.03. No such funding of risk participations shall relieve or otherwise impair the obligation of the Borrower to repay Swing Line Loans, together with interest as provided herein.

(d) Repayment of Participations.

(i) At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if the Swing Line Lender receives any payment on account of such Swing Line Loan, the Swing Line Lender will distribute to such Lender its Pro Rata Share thereof in the same funds as those received by the Swing Line Lender.

(ii) If any payment received by the Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by the Swing Line Lender under any of the circumstances described in Section 10.05 (including pursuant to any settlement entered into by the Swing Line Lender in its discretion), each Lender shall pay to the Swing Line Lender its Pro Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned, at a rate per annum equal to the Federal Funds Rate. The Administrative Agent will make such demand upon the request of the Swing Line Lender. The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(e) Interest for Account of Swing Line Lender. The Swing Line Lender shall be responsible for invoicing the Borrower for interest on the Swing Line Loans. Until each Lender funds its Base Rate Committed Loan or risk participation pursuant to this Section 2.05 to refinance such Lender’s Pro Rata Share of any Swing Line Loan, interest in respect of such Pro Rata Share shall be solely for the account of the Swing Line Lender.

(f) Payments Directly to Swing Line Lender. The Borrower shall make all payments of principal and interest in respect of the Swing Line Loans directly to the Swing Line Lender.

2.06 Prepayments.

(a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Committed Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to any date of prepayment of Eurodollar Rate Committed Loans and (B) on the date of prepayment of Base Rate Committed Loans; (ii) any prepayment of Eurodollar Rate Committed Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; and (iii) any prepayment of Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Committed Loans to be prepaid. The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s Pro Rata Share of such prepayment. If

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such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein, unless such notice is made conditional on a transaction or financing, in which case the obligation of the Borrower to make such prepayment (and to pay such payment amount) shall be subject to such conditions. Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.05. Subject to Section 2.17, each such prepayment shall be applied to the Committed Loans of the Lenders in accordance with their respective Pro Rata Shares.

(b) Unless otherwise agreed by the Borrower and the applicable Bid Loan Lender, the Borrower may voluntarily prepay Bid Loans in whole or in part without premium or penalty in accordance with the provisions of this subsection (b). The Borrower may, upon notice to the applicable Bid Loan Lender (with a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay Bid Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Bid Loan Lender and the Administrative Agent not later than 11:00 a.m. three Business Days prior to any date of prepayment, and (ii) any such prepayment shall be in a minimum principal amount of $1,000,000. Each such notice shall specify the date and amount of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. Any prepayment of a Bid Loan shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.05.

(c) The Borrower may, upon notice to the Swing Line Lender (with a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Swing Line Lender and the Administrative Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such prepayment shall be in a minimum principal amount of $1,000,000. Each such notice shall specify the date and amount of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein.

(d) If for any reason the Total Outstandings at any time exceed the Aggregate Commitments then in effect, the Borrower shall immediately prepay Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided, however, that the Borrower shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.06(d) unless after the prepayment in full of the Committed Loans and Swing Line Loans the Total Outstandings exceed the Aggregate Commitments then in effect.

2.07 Termination or Reduction of Commitments. The Borrower may, upon notice to the Administrative Agent (which notice may be conditioned on the consummation of a transaction or financing), terminate the Aggregate Commitments, or from time to time permanently reduce the Aggregate Commitments; provided that (i) any such notice shall be received by the Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Aggregate Commitments, and (iv) if, after giving effect to any reduction of the Aggregate Commitments, the Bid Loan Sublimit, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate Commitments, such Sublimit shall be automatically reduced by the amount of such excess. The Administrative Agent will promptly notify the Lenders of any such notice of termination or reduction of the Aggregate Commitments. Any reduction of the Aggregate Commitments shall be applied to the Commitment of each Lender according to its Pro Rata Share. All Facility Fees

accrued until the effective date of any termination of the Aggregate Commitments shall be paid on the effective date of such termination.

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2.08 Repayment of Loans.

(a) The Borrower shall repay to the Lenders on the Maturity Date the aggregate principal amount of Committed Loans outstanding on such date.

(b) The Borrower shall repay each Bid Loan on the last day of the Interest Period in respect thereof.

(c) The Borrower shall repay each Swing Line Loan on the earlier to occur of (i) the date ten Business Days after such Loan is made and (ii) the Maturity Date.

2.09 Interest.

(a) Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Committed Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate Committed Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate; (iii) each Bid Loan shall bear interest on the outstanding principal amount thereof for the Interest Period therefor at a rate per annum equal to the Eurodollar Rate for such Interest Period plus (or minus) the Eurodollar Bid Margin, or at the Absolute Rate for such Interest Period, as the case may be; and (iv) each Swing Line Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.

(b) If any amount payable by the Borrower under any Loan Document is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

2.10 Fees. In addition to certain fees described in subsections (i) and (j) of Section 2.04:

(a) Facility Fee. The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Pro Rata Share, a facility fee (the “Facility Fee”) equal to the Applicable Rate times the actual daily amount of the Aggregate Commitments (or, if the Aggregate Commitments have terminated, on the Outstanding Amount of all Committed Loans, Swing Line Loans and L/C Obligations), regardless of usage, subject to adjustment as provided in Section 2.17. The Facility Fee shall begin to accrue on the date that is the earlier of (i) March 31, 2014, and (ii) the Closing Date, and shall accrue at all times during the Availability Period (and thereafter so long as any Committed Loans, Swing Line Loans or L/C Obligations remain outstanding), including at any time during which one or more of the conditions in Article IV is not met, and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the date that the Facility Fee begins to accrue, and on the last day of the Availability Period

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(and, if applicable, thereafter on demand). The Facility Fee shall be calculated quarterly in arrears, and if there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect.

(b) Other Fees.

(i) The Borrower shall pay to the Arrangers and the Administrative Agent for their own respective accounts fees in the amounts and at the times specified in the Fee Letters. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

(ii) The Borrower shall pay to the Lenders such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

2.11 Computation of Interest and Fees. All computations of interest for Base Rate Loans (including Base Rate Loans determined by reference to the Eurodollar Rate) shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year). Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.13(a), bear interest for one day.

2.12 Evidence of Debt.

(a) The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary course of business. The accounts or records maintained by the Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Note, which shall evidence such Lender’s Loans in addition to such accounts or records. Each Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

(b) In addition to the accounts and records referred to in subsection (a), each Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflict between the accounts and records maintained by the Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

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2.13 Payments Generally.

(a) All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein. The Administrative Agent will promptly distribute to each Lender its Pro Rata Share (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue.

(b) If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

(c) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Committed Borrowing of Eurodollar Rate Loans (or, in the case of any Committed Borrowing of Base Rate Loans, prior to 12:00 p.m. on the date of such Committed Borrowing of Base Rate Loans) that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 (or, in the case of a Committed Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02) and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Committed Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays its share of the applicable Committed Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Committed Loan included in such Committed Borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

(ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the L/C Issuer hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the L/C Issuer, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the L/C Issuer, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such

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Lender or the L/C Issuer, in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection (c) shall be conclusive, absent manifest error.

(d) If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

(e) The obligations of the Lenders hereunder to make Committed Loans and to fund participations in Letters of Credit and Swing Line Loans and to make payments pursuant to Section 10.04(c) are several and not joint. The failure of any Lender to make any Committed Loan or to fund any such participation or to make any payment under Section 10.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Committed Loan or purchase its participation or to make its payment under Section 10.04(c).

(f) Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

2.14 Sharing of Payments. If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Committed Loans made by it, or the participations in L/C Obligations or in Swing Line Loans held by it resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Committed Loans or participations and accrued interest thereon greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Committed Loans and subparticipations in L/C Obligations and Swing Line Loans of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Committed Loans and other amounts owing them, provided that:

(a) if any such participations or subparticipations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations or subparticipations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(b) the provisions of this Section shall not be construed to apply to (x) any payment made by or on behalf of the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender), or (y) the application of Cash Collateral provided for in Section 2.17, or (z) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or subparticipations in L/C Obligations or Swing Line Loans to any assignee or participant, other than to the Borrower or any Affiliate thereof (as to which the provisions of this Section shall apply).

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The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

2.15 Extension of Maturity Date.

(a) Requests for Extension. The Borrower may, by notice to the Administrative Agent (who shall promptly notify the Lenders) not earlier than 90 days and not later than 35 days prior to an anniversary of the Closing Date (each, an “Applicable Anniversary Date”), request that each Lender extend such Lender’s Maturity Date for an additional year from the Maturity Date then in effect for such Lender hereunder (such Lender’s “Existing Maturity Date”). The Borrower may request such an extension no more than two times.

(b) Lender Elections to Extend. Each Lender, acting in its sole and individual discretion, shall, by notice to the Administrative Agent not later than the date (the “Notice Date”) that is 20 days prior to such Applicable Anniversary Date, advise the Administrative Agent whether or not such Lender agrees to such extension (and each Lender that determines not to so extend its Maturity Date (a “Non-Extending Lender”) shall notify the Administrative Agent of such fact promptly after such determination (but in any event no later than the Notice Date)) and any Lender that does not so advise the Administrative Agent on or before the Notice Date shall be deemed to be a Non-Extending Lender. The election of any Lender to agree to such extension (each such Lender is herein called an “Extending Lender”) shall not obligate any other Lender to so agree.

(c) Notification by Administrative Agent. The Administrative Agent shall notify the Borrower of each Lender’s determination under this Section no later than the date that is 15 days prior to the Applicable Anniversary Date (or, if such date is not a Business Day, on the next preceding Business Day).

(d) Additional Commitment Lenders. The Borrower shall have the right, on or before the Maturity Date applicable to any Non-Extending Lender, to replace such Non-Extending Lender with, and add as “Lenders” under this Agreement in place thereof, one or more Eligible Assignees (each, an “Additional Commitment Lender”) as provided in Section 10.14, each of which Additional Commitment Lenders shall have entered into an Assignment and Assumption pursuant to which each such Additional Commitment Lender shall, effective as of such Existing Maturity Date, undertake a Commitment (and, if any such Additional Commitment Lender is already a Lender, its Commitment shall be in addition to such Lender’s Commitment hereunder on such date).

(e) Minimum Extension Requirement. If (and only if) the aggregate amount of (x) Commitments of the Lenders that have agreed to extend their Maturity Date and (y) additional Commitments of Additional Commitment Lenders shall be more than 50% of the Aggregate Commitments in effect immediately prior to an Applicable Anniversary Date, then, effective as of the Existing Maturity Date of each such Extending Lender, the Maturity Date of each such Extending Lender and of each such Additional Commitment Lender shall be extended to the date falling one year after the Existing Maturity Date of each such Extending Lender (except that, if such date is not a Business Day, such Maturity Date as so extended shall be the next preceding Business Day) and each Additional Commitment Lender shall thereupon become a “Lender” for all purposes of this Agreement.

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(f) Conditions to Effectiveness of Extensions. As a condition precedent to the extension of the Maturity Date pursuant to this Section:

(i) the Borrower shall deliver to the Administrative Agent (A) a certificate signed by the Secretary or an Assistant Secretary of the Borrower certifying and attaching the resolutions adopted by the Borrower approving or consenting to such extension (which may be general enabling resolutions), and (B) a certificate of a Responsible Officer of the Borrower certifying that (1) no Default exists on the date of such certificate, either before or after giving effect to such extension; (2) the representations and warranties contained in this Agreement are true and correct in all material respects on and as of such date both before giving effect to such extension and after giving effect thereto (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date and except that such materiality qualifier shall not apply to the extent that any such representation or warranty is qualified by materiality); and (3) there has been no event or circumstance since the Closing Date that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect;

(ii) on the Maturity Date applicable to each Non-Extending Lender, the Borrower shall prepay, on a non pro rata basis with respect to Extending Lenders, any Committed Loans outstanding on such date (and pay any additional amounts required pursuant to Section 3.05) to the extent necessary to satisfy in full the Obligations due to such Non-Extending Lender as of such date;

(iii) on the Maturity Date applicable to each Non-Extending Lender, the Borrower shall Cash Collateralize any existing Letters of Credit or make other credit accommodations reasonably satisfactory to the L/C Issuer with respect to such Letters of Credit to the extent that, after giving effect to the payment required by the preceding clause (ii), the Total Outstandings exceed the Commitments of the remaining Lenders; and

(iv) in the event that any Non-Extending Lender is a L/C Issuer and any one or more Letters of Credit issued by such L/C Issuer under this Agreement remain outstanding on such L/C Issuer’s Maturity Date, the Borrower shall cash collateralize such Letter of Credit upon terms reasonably satisfactory to such L/C Issuer to secure the Borrower’s obligations to reimburse for drawings under such Letters of Credit or make other arrangements reasonably satisfactory to such L/C Issuer with respect to such Letters of Credit including providing other credit support.

(g) Conflicting Provisions. This Section shall supersede any provisions in Section 2.14 or 10.01 to the contrary.

2.16 Increase in Commitments.

(a) Request for Increase. Provided there exists no Default or Event of Default, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the Borrower may, from time to time, request an increase in the Aggregate Commitments by an amount (for all such requests) not exceeding $500,000,000; provided that any such request for an increase shall be in a minimum amount of $5,000,000. To achieve the requested increase, the Borrower may ask that one or more Lenders increase their existing Commitments and/or the Borrower may invite additional Eligible Assignees to become Lenders pursuant to a joinder agreement in form and substance reasonably satisfactory to the Administrative Agent. In the event that the Borrower desires to ask all Lenders whether they are willing to increase their Commitments, the Borrower (in consultation with the Administrative Agent) shall

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specify the time period within which each Lender is requested to respond. In such case, each Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Pro Rata Share of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment.

(b) Effective Date and Allocations. If the Aggregate Commitments are increased in accordance with this Section, the Borrower shall determine the effective date (subject to the approval of the Administrative Agent, not to be unreasonably withheld) (the “Increase Effective Date”) and the final allocation of such increase. The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation of such increase and the Increase Effective Date.

(c) Conditions to Effectiveness of Increase. As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent the following, each dated as of the Increase Effective Date: (i) a certificate signed by the Secretary or an Assistant Secretary of the Borrower certifying and attaching the resolutions adopted by the Borrower approving or consenting to such increase, and (ii) a certificate of the Borrower signed by a Responsible Officer of the Borrower certifying that, before and after giving effect to such increase, (I) the representations and warranties contained in Article V and the other Loan Documents are true and correct in all material respects on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date (except that such materiality qualifier shall not apply to the extent that any such representation or warranty is qualified by materiality), (II) no Default exists, and (III) there has been no event or circumstance since the date of the Closing Date that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect. To the extent the Aggregate Commitments are being increased on the relevant Increase Effective Date, then each of the Lenders having a Commitment prior to such Increase Effective Date (such Lenders, the “Pre-Increase Lenders”) shall assign or transfer to any Lender which is acquiring a new Commitment on the Increase Effective Date (the “Post-Increase Lenders”), and such Post-Increase Lenders shall purchase from each such Pre-Increase Lender, at the funded principal amount thereof, such interest in the Loans and participation interests in L/C Obligations and Swing Line Loans (but not, for the avoidance of doubt, the related Commitments) outstanding on such Increase Effective Date as shall be necessary in order that, after giving effect to all such assignments or transfers and purchases, such Loans and participation interests in L/C Obligations and Swing Line Loans will be held by Pre-Increase Lenders and Post-Increase Lenders ratably in accordance with their Commitments after giving effect to such increase in Commitments (and after giving effect to any Loans made on the relevant Increase Effective Date). Such assignments or transfers and purchases shall be made in accordance with Section 10.06.

(d) Conflicting Provisions. This Section shall supersede any provisions in Section 2.14 or 10.01 to the contrary.

2.17 Defaulting Lenders.

(a) Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:

(i) Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders and in Section 10.01.

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(ii) Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.08 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the L/C Issuer and the Swing Line Lender hereunder; third, to Cash Collateralize the L/C Issuers’ or the Swing Line Lender’s Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.04(g); fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the L/C Issuer’s and the Swing Line Lender’s future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit and Swing Line Loans issued under this Agreement, in accordance with Section 2.04(g); sixth, to the payment of any amounts owing to the Lenders, the L/C Issuer or Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the L/C Issuer or Swing Line Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Advances in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.03 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Advances owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Advances owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations and Swing Line Loans are held by the Lenders pro rata in accordance with the Commitments without giving effect to Section 2.17(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.17(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii) Certain Fees.

(A) Each Defaulting Lender shall be entitled to receive a Facility Fee for any period during which that Lender is a Defaulting Lender only to the extent allocable to the sum of (1) the outstanding principal amount of the Committed Loans funded by it, and (2) its Pro Rata Share of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.04(g).

(B) Each Defaulting Lender shall be entitled to receive Letter of Credit Fees for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Pro Rata Share of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.04(g).

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(C) With respect to any Facility Fee or Letter of Credit Fee not required to be paid to any Defaulting Lender pursuant to clause (A) or (B) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in L/C Obligations or Swing Line Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to the L/C Issuer and Swing Line Lender, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to the L/C Issuer’s or Swing Line Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

(iv) Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in L/C Obligations and Swing Line Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Pro Rata Shares (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.03 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the Pro Rata Share of any Non-Defaulting Lender in the Total Outstandings to exceed such Non-Defaulting Lender’s Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(v) Cash Collateral, Repayment of Swing Line Loans. If the reallocation described in clause (iv) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, (x) first, prepay Swing Line Loans in an amount equal to the Swing Line Lender’s Fronting Exposure and (y) second, Cash Collateralize the L/C Issuer’s Fronting Exposure in accordance with the procedures set forth in Section 2.04(g).

(b) Defaulting Lender Cure. If the Borrower, the Administrative Agent, the Swing Line Lender and each L/C Issuer agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held pro rata by the Lenders in accordance with the Commitments (without giving effect to Section 2.17(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

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(c) New Swing Line Loans/Letters of Credit. So long as any Lender is a Defaulting Lender, (i) the Swing Line Lender shall not be required to fund any Swing Line Loans unless it is reasonably satisfied that it will have no Fronting Exposure after giving effect to such Swing Line Loan and (ii) the L/C Issuer shall not be required to issue, extend, renew or increase any Letter of Credit unless it is reasonably satisfied that it will have no Fronting Exposure after giving effect thereto arising from either the Letter of Credit then proposed to be issued, extended, renewed or increased or that Letter of Credit and all other L/C Obligations as to which the L/C Issuer has Fronting Exposure.

ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY

3.01 Taxes.

(a) Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes.

(i) Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document shall to the extent permitted by applicable Laws be made without deduction or withholding for any Taxes. If, however, applicable Laws require the Borrower or the Administrative Agent to withhold or deduct any Tax as determined by the Borrower or the Administrative Agent, as the case may be, then the Administrative Agent or the Borrower shall be entitled to make such deduction or withholding, upon the basis of the information and documentation to be delivered pursuant to subsection (e) below.

(ii) If the Borrower or the Administrative Agent shall be required by the Code to withhold or deduct any Taxes, including both United States Federal backup withholding and withholding taxes, from any payment, then (A) the Administrative Agent shall withhold or make such deductions as are determined by the Administrative Agent to be required based upon the information and documentation it has received pursuant to subsection (e) below, (B) the Administrative Agent shall timely pay the full amount withheld or deducted to the relevant Governmental Authority in accordance with the Code, and (C) to the extent that the withholding or deduction is made on account of Indemnified Taxes, the sum payable by the Borrower shall be increased as necessary so that after any required withholding or the making of all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent, Lender or L/C Issuer, as the case may be, receives an amount equal to the sum it would have received had no such withholding or deduction been made.

(iii) If the Borrower or the Administrative Agent shall be required by any applicable Laws other than the Code to withhold or deduct any Taxes from any payment, then (A) the Borrower or the Administrative Agent, as required by such Laws, shall withhold or make such deductions as are determined by it to be required based upon the information and documentation it has received pursuant to subsection (e) below, (B) the Borrower or the Administrative Agent, to the extent required by such Laws, shall timely pay the full amount withheld or deducted to the relevant Governmental Authority in accordance with such Laws, and (C) to the extent that the withholding or deduction is made on account of Indemnified Taxes, the sum payable by the Borrower shall be increased as necessary so that after any required withholding or the making of all required deductions (including deductions applicable to additional sums payable under this Section 3.01) the applicable Administrative Agent, Lender or L/C Issuer receives an amount equal to the sum it would have received had no such withholding or deduction been made.

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(b) Payment of Other Taxes by the Borrower. Without limiting the provisions of subsection (a) above, the Borrower shall timely pay Other Taxes to the relevant Governmental Authority in accordance with applicable Laws, or at the option of the Administrative Agent timely reimburse it for the payment of, such Other Taxes.

(c) Tax Indemnifications.

(i) Without limiting the provisions of subsection (a) or (b) above, the Borrower shall, and does hereby, indemnify the Administrative Agent, each Lender and the L/C Issuer, and shall make payment in respect thereof within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) withheld or deducted by the Borrower or the Administrative Agent or paid by the Administrative Agent, such Lender or the L/C Issuer, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.

(ii) Each Lender and the L/C Issuer shall, and does hereby, severally indemnify, and shall make payment in respect thereof within 10 days after demand therefor, (x) the Administrative Agent against any Indemnified Taxes attributable to such Lender or the L/C Issuer (but only to the extent that the Borrower has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (y) the Administrative Agent and the Borrower, as applicable, against any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.06(d) relating to the maintenance of a Participant Register and (z) the Administrative Agent and the Borrower, as applicable, against any Excluded Taxes attributable to such Lender or the L/C Issuer, in each case, that are payable or paid by the Administrative Agent or the Borrower in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender and the L/C Issuer hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender or the L/C Issuer, as the case may be, under this Agreement or any other Loan Document against any amount due to the Administrative Agent under this clause (ii). The agreements in this clause (ii) shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender or the L/C Issuer, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all other Obligations. The Borrower shall, and does hereby, indemnify the Administrative Agent, and shall make payment in respect thereof within 10 days after demand therefor, for any amount which a Lender or the L/C Issuer fails to pay to the Administrative Agent as required by this clause (ii).

(d) Evidence of Payments. Upon request by the Borrower or the Administrative Agent, as the case may be, after any payment of Taxes by the Borrower or by the Administrative Agent to a Governmental Authority as provided in this Section 3.01, the Borrower shall deliver to the Administrative Agent or the Administrative Agent shall deliver to the Borrower, as the case may be, the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of any return required by Laws to report such payment or other evidence of such payment reasonably satisfactory to the Borrower or the Administrative Agent, as the case may be.

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(e) Status of Lenders; Tax Documentation.

(i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and to the Administrative Agent, at the time or times prescribed by applicable Laws or when reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.01(e)(ii)(A), 3.01(e)(ii)(B) and 3.01(e)(ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii) Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2) executed originals of IRS Form W-8ECI;

(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit G-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a

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“10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN; or

(4) to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax

Compliance Certificate substantially in the form of Exhibit G-4 on behalf of each such direct and indirect partner;

(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

(iii) Each Lender agrees that if any form or certification it previously delivered pursuant to this Section 3.01 expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

(f) Treatment of Certain Refunds. Unless required by applicable Laws, at no time shall the Administrative Agent have any obligation to file for or otherwise pursue on behalf of a Lender or the L/C Issuer, or have any obligation to pay to any Lender or any L/C Issuer, any refund of Taxes withheld or

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deducted from funds paid for the account of such Lender or such L/C Issuer, as the case may be. If the Administrative Agent, any Lender or any L/C Issuer determines, in its sole discretion, exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to this Section, it shall pay to the Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses of the Administrative Agent, such Lender or such L/C Issuer, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided that the Borrower, upon the request of the Administrative Agent, such Lender or such L/C Issuer, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent, such Lender or such L/C Issuer in the event the Administrative Agent, such Lender or such L/C Issuer is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this subsection, in no event will the Administrative Agent, any Lender or any L/C Issuer be required to pay any amount to the Borrower pursuant to this subsection to the extent such payment would place the Administrative Agent, any Lender or any L/C Issuer in a less favorable net after-Tax position than the Administrative Agent, any Lender or any L/C Issuer would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This subsection shall not be construed to require the Administrative Agent, any Lender or any L/C Issuer to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Borrower or any other Person.

(g) Survival. Each party’s obligations under this Section 3.01 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender or a L/C Issuer, the termination of the Commitments and the repayment, satisfaction or discharge of all other Obligations.

3.02 Illegality. If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to the Eurodollar Rate, or to determine or charge interest rates based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, (i) any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate Committed Loans shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining Base Rate Loans the interest rate on which is determined by reference to the Eurodollar Rate component of the Base Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Eurodollar Rate component of the Base Rate, in each case until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, (x) the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Eurodollar Rate component of the Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans and (y) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Eurodollar Rate, the Administrative Agent shall during the period of such suspension compute the Base Rate applicable to such Lender without reference to the Eurodollar Rate

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component thereof until the Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon the Eurodollar Rate. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted.

3.03 Inability to Determine Rates. If in connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof, (a) the Administrative Agent determines that (i) Dollar deposits are not being offered to banks in the London interbank eurodollar market for the applicable amount and Interest Period of such Eurodollar Rate Loan, or (ii) adequate and reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Committed Loan or in connection with an existing or proposed Base Rate Loan (in each case with respect to clause (a) above, “Impacted Loans”), or (b) the Administrative Agent or the Required Lenders determine for any reason that the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Committed Loan does not adequately and fairly reflect the cost to such Lenders of funding such Loan, the Administrative Agent will so notify the Borrower, by telephone or facsimile as promptly as practicable thereafter and will promptly so notify each Lender. Thereafter, (x) the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended (to the extent of the affected Eurodollar Rate Loans or Interest Periods), and (y) in the event of a determination described in the preceding sentence with respect to the Eurodollar Rate component of the Base Rate, the utilization of the Eurodollar Rate component in determining the Base Rate shall be suspended, in each case until the Administrative Agent (upon the instruction of the Administrative Agent or the Required Lenders, depending on who made the determination) revokes such notice. Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans suspended (to the extent of the affected Eurodollar Rate Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Committed Borrowing of Base Rate Loans in the amount specified therein.

Notwithstanding the foregoing, if the Administrative Agent has made the determination described in clause (a)(i) of this Section, the Administrative Agent, in consultation with the Borrower and the affected Lenders, may establish an alternative interest rate for the Impacted Loans, in which case, such alternative rate of interest shall apply with respect to the Impacted Loans (unless the Borrower elects to maintain the Impacted Loans as Base Rate Loans) until (1) the Administrative Agent revokes the notice delivered with respect to the Impacted Loans under clause (a) of the first sentence of this Section, (2) the Administrative Agent or the Required Lenders notify the Administrative Agent and the Borrower that such alternative interest rate does not adequately and fairly reflect the cost to such Lenders of funding the Impacted Loans, or (3) as to any Lender, such Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for such Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to such alternative rate of interest or to determine or charge interest rates based upon such rate or any Governmental Authority has imposed material restrictions on the authority of such Lender to do any of the foregoing and provides the Administrative Agent and the Borrower written notice thereof.

3.04 Increased Costs; Reserves on Eurodollar Rate Loans.

(a) Increased Costs Generally. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement contemplated by Section 3.04(e)) or any L/C Issuer;

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(ii) subject any Lender or any L/C Issuer to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clause (a) of the definition of Excluded Taxes to the extent resulting from changes in tax rates, and Taxes described in clauses (b) through (d) of the definition of Excluded Taxes or (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii) impose on any Lender or any L/C Issuer or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Rate Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making, continuing, converting to or maintaining any Loan the interest on which is determined by reference to the Eurodollar Rate (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender or such L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or such L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or such L/C Issuer, the Borrower will pay to such Lender or such L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or such L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered.

(b) Capital Requirements. If any Lender or any L/C Issuer determines that any Change in Law affecting such Lender or such L/C Issuer or any Lending Office of such Lender or such Lender’s or such L/C Issuer’s holding company, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or such L/C Issuer’s capital or on the capital of such Lender’s or such L/C Issuer’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such L/C Issuer, to a level below that which such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such L/C Issuer’s policies and the policies of such Lender’s or such L/C Issuer’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender or such L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company for any such reduction suffered.

(c) Certificates for Reimbursement. The Borrower shall pay such Lender or L/C Issuer, as the case may be, the amount shown as due on a certificate from such Lender or L/C Issuer setting forth the amounts necessary to compensate such Lender or L/C Issuer or its holding company to the extent required by subsection (a) or (b) of this Section within 10 days after receipt thereof. Each Lender agrees that it will not claim, and that it shall not be entitled to claim, from the Borrower the payment of any of the amounts referred to in Section 3.04(a), (b) or (e) if it is not generally claiming similar compensation from its other similar customers in similar circumstances.

(d) Delay in Requests. Failure or delay on the part of any Lender or any L/C Issuer to demand compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of such Lender’s or such L/C Issuer’s right to demand such compensation, provided that the Borrower shall not be required to compensate a Lender or a L/C Issuer pursuant to the foregoing provisions of this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender or such L/C Issuer, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or such L/C Issuer’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

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(e) Reserves on Eurodollar Rate Loans. The Borrower shall pay to each Lender, as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurodollar Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Loan, provided the Borrower shall have received at least 15 days’ prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender. If a Lender fails to give notice 15 days prior to the relevant Interest Payment Date, such additional interest shall be due and payable 15 days from receipt of such notice.

3.05 Compensation for Losses. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

(a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; or

(c) any assignment of a Eurodollar Rate Loan or Bid Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to Section 10.14;

including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained, but excluding any loss of Applicable Rate or loss of profit. The Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Committed Loan or Bid Loan made by it at the Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded.

3.06 Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender requests compensation under Section 3.04, or the Borrower is required to pay any additional amount to any Lender, or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, then such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

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(b) Replacement of Lenders. If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, the Borrower may replace such Lender in accordance with Section 10.14.

3.07 Survival. All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitments and repayment of all other Obligations hereunder.

ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01 Conditions to Effectiveness of this Agreement (Execution Date). This Agreement shall be effective upon satisfaction (or waiver in accordance with Section 10.01) of the conditions precedent set forth in this Section 4.01; provided that the obligations of the Lenders to make Credit Extensions hereunder are subject to satisfaction (or waiver in accordance with Section 10.01) of the conditions precedent set forth in Section 4.02 and Section 4.03:

(a) The Administrative Agent’s receipt of the following, each of which shall be originals, facsimiles or “pdf” electronic copies (followed promptly by originals) unless otherwise specified, each dated the Execution Date (or, in the case of certificates of governmental officials, a recent date before the Execution Date):

(i) executed counterparts of this Agreement, in the number requested by the Administrative Agent; and

(ii) a certificate of a Responsible Officer of the Borrower either (i) (A) stating that all governmental and regulatory approvals necessary in connection with the execution and delivery by the Borrower of this Agreement have been obtained and are in full force and effect, or (ii) stating that no such consents, licenses or approvals are required.

(b) The Lenders shall have received such documentation and other information as may be required by them in order to enable compliance with applicable “know your customer” and anti-money laundering rules and regulations, including the information required by the USA PATRIOT Act and information described in Section 10.18.

(c) Any expenses required to be paid by the Borrower, to the extent invoiced prior to the Execution Date, shall have been paid.

(d) Unless waived by the Administrative Agent, the Borrower shall have paid all Attorney Costs (related to Haynes and Boone, LLP) of the Administrative Agent and the Left Lead Arranger to the extent invoiced prior to or on the Closing Date, plus such additional amounts of Attorney Costs as shall constitute its reasonable estimate of Attorney Costs (related to Haynes and Boone, LLP) incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent and the Left Lead Arranger.

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Without limiting the generality of the provisions of the last paragraph of Section 9.03, for purposes of determining compliance with the conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required under this Section 4.01 to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Execution Date specifying its objection thereto.

The Administrative Agent shall notify the Lenders and the Borrower of the Execution Date, and such notice shall be conclusive.

4.02 Conditions to Closing Date and Initial Credit Extension. The obligation of each Lender and L/C Issuer to make its initial Credit Extension hereunder is subject to the occurrence of the Execution Date and satisfaction of the following conditions precedent:

(a) The Administrative Agent’s receipt of the following, each of which shall be originals, facsimiles or “pdf” electronic copies (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the Borrower, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and substance reasonably satisfactory to the Administrative Agent:

(i) a Note executed by the Borrower in favor of each Lender requesting a Note;

(ii) a certificate of a secretary or assistant secretary of the Borrower (attaching resolutions and incumbency certificates as the Administrative Agent may reasonably require) evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents;

(iii) a certificate as to the good standing (or such other customary functionally equivalent certificate) of the Borrower from the Secretary of State (or other applicable Governmental Authority) of Oklahoma;

(iv) favorable opinions of counsel to the Borrower, addressed to the Administrative Agent and each Lender as of the Closing Date, reasonably satisfactory to the Administrative Agent and the Arrangers, issued by the following firms or other counsel reasonably satisfactory to the Administrative Agent: (i) GableGotwals, (ii) Skadden, Arps, Slate, Meagher & Flom LLP, special New York counsel to the Borrower, and (iii) Anderson & Byrd, LLP, special Kansas counsel to the Borrower for legal opinions regarding receipt of all material public utility regulatory approvals from the Kansas Corporation Commission required in connection with the ONE Gas Separation Transactions; and

(v) a certificate of a Responsible Officer of the Borrower (A) either (x) attaching copies of all consents, licenses and approvals required in connection with the execution, delivery and performance by the Borrower and the validity against the Borrower of the Loan Documents, and such consents, licenses and approvals shall be in full force and effect, or (y) stating that no such consents, licenses or approvals are so required, (B) certifying as to the solvency of the Borrower and its Subsidiaries (on a consolidated basis) on a pro forma basis after giving effect to the ONE Gas Separation Transactions, (C) certifying as to the satisfaction of the conditions set forth in clauses (b), (c), (d) and (f) in this Section 4.02, and (D) in the event Schedule 5.13 is no longer accurate, attaching an updated version of Schedule 5.13.

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(b) Before and after giving effect to the consummation of the ONE Gas Separation Transactions (i) no Default or Event of Default shall exist, (ii) the representations and warranties of the Borrower contained in Article V shall be true and correct in all material respects, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date, except that such materiality qualifier shall not apply to the extent that any such representation or warranty is qualified by materiality, and (iii) there shall have been no event or circumstance since September 30, 2013 that has had or could be reasonably expected to have, either individually or in the aggregate, (A) a material adverse change in, or a material adverse effect upon, the operations, assets or financial condition of the Borrower, its Subsidiaries and the Contribution Business taken as a whole; provided however (x) a downgrade by S&P and/or Moody’s of their respective Debt Ratings shall not, in and of itself, be deemed “materially adverse”, and (y) the fact that the Borrower is unable to borrow in the commercial paper market shall not, in and of itself, be deemed to be “materially adverse”, (B) a material impairment of the ability of the Borrower to perform its payment obligations under any Loan Document to which it is a party after taking into account the ONE Gas Separation Transactions, or (C) a material adverse effect upon the legality, validity, binding effect or enforceability against the Borrower of any Loan Document.

(c) All partnership and company consents and approvals and all material governmental and third-party consents and approvals necessary in connection with the ONE Gas Separation Transactions shall have been obtained and shall be in full force and effect, and all applicable waiting periods have expired without any action being taken or threatened by any governmental, regulatory or other similar authority which would restrain in a materially adverse manner or prevent or otherwise impose materially adverse conditions on the ONE Gas Separation Transactions.

(d) The ONE Gas Separation Transactions shall have been consummated or shall be consummated substantially concurrently with satisfaction of the other conditions precedent set forth in this Section 4.02 (A) in compliance in all material respects with applicable law and regulatory approvals and (B) in all material respects as described in the Registration Statement.

(e) The Borrower shall have provided to the Administrative Agent true, correct and complete copies of its Organizational Documents, each Material Agreement to which it is a party and all amendments thereto, the material terms of which shall be reasonably satisfactory to the Arrangers. Any Organizational Documents and Material Agreements filed with the SEC in connection with the ONE Gas Separation Transactions and available on EDGAR shall be deemed delivered for purposes of this Section. All terms that materially conform to the description thereof in the Registration Statement, with such changes and additions that are Acceptable Changes, shall be deemed to be reasonably satisfactory to the Arrangers.

(f) The Borrower’s senior unsecured long-term debt shall have been rated by S&P and Moody’s.

(g) The Borrower shall have delivered the Initial Financial Statements to the Administrative Agent; provided, however, that such delivery may be completed by including such financial statements on the Registration Statement available on EDGAR.

(h) To the extent not delivered to the Lenders pursuant to Section 4.01, the Lenders shall have received such documentation and other information as may be required by them in order to enable compliance with applicable “know your customer” and anti-money laundering rules and regulations, including the information required by the USA PATRIOT Act and information described in Section 10.18.

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(i) In the event that the Borrower elects to make any changes to Schedule 1.01A, then not later than five Business Days (or such shorter period as the Administrative Agent may approve) prior to the Closing Date, the Administrative Agent shall have received from the Borrower a written notice setting forth such proposed changes, which notice the Administrative Agent shall promptly distribute to the Lenders. To the extent that such proposed changes to such Schedule are reasonably approved by the Administrative Agent and the Arrangers, then such Schedule shall be deemed amended as set forth in such notice upon the Closing Date.

(j) Any fees and expenses required to be paid by the Borrower on or before the Closing Date shall have been paid, including upfront fees payable to Lenders and fees payable to the Joint Lead Arrangers and Book Managers and the Administrative Agent.

(k) Unless waived by the Administrative Agent, the Borrower shall have paid all Attorney Costs (related to Haynes and Boone, LLP) of the Administrative Agent and the Left Lead Arranger to the extent invoiced prior to or on the Closing Date, plus such additional amounts of Attorney Costs as shall constitute its reasonable estimate of Attorney Costs (related to Haynes and Boone, LLP) incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent and the Left Lead Arranger).

Without limiting the generality of the provisions of Section 9.03, for purposes of determining compliance with the conditions specified in this Section 4.02, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required under this Section 4.02 to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

The Administrative Agent shall notify the Lenders and the Borrower of the Closing Date. Such notice shall be binding and conclusive.

Notwithstanding the foregoing, the obligations of the Lenders to make Loans and of the L/C Issuers to issue Letters of Credit hereunder shall not become effective unless each of the foregoing conditions is satisfied (or waived in accordance with Section 10.01(a)) at or prior to 5 p.m., New York City time, on March 31, 2014, and in the event such conditions are not so satisfied or waived, the Commitments shall terminate at such time.

4.03 Conditions to all Credit Extensions. The obligation of each Lender to honor any Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type, or a continuation of Eurodollar Rate Committed Loans) is subject to the following conditions precedent:

(a) The representations and warranties of the Borrower contained in Article V (other than, in the case of a Commercial Paper Borrowing, Section 5.06), or any other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects on and as of the date of such Credit Extension, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date, except that such materiality qualifier shall not apply to the extent that any such representation or warranty is qualified by materiality

(b) No Default shall exist, or would result from such proposed Credit Extension.

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(c) The Administrative Agent and, if applicable, any L/C Issuer or the Swing Line Lender, shall have received a Request for Credit Extension in accordance with the requirements hereof.

Each Request for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed Loans to the other Type, or a continuation of Eurodollar Rate Committed Loans) submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 4.03(a), (b) and (c) have been satisfied on and as of the date of the applicable Credit Extension.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Administrative Agent, the Lenders and the L/C Issuers as of the Closing Date and thereafter as of each date required by Section 4.03, that:

5.01 Existence, Qualification and Power. Each of the Borrower and each of its Subsidiaries (a) is a corporation, partnership or limited liability company duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own its assets and carry on its business and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party, and (c) is duly qualified and is licensed and in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clause (b)(i) or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

5.02 Authorization; No Contravention. The execution, delivery and performance by the Borrower of each Loan Document has been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of the Borrower’s Organization Documents; (b) conflict with or result in any breach or contravention of (i) any Contractual Obligation to which the Borrower or any of its Subsidiaries is a party or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which the Borrower or any of its Subsidiaries or its property is subject; (c) violate any Law or (d) result in the creation of any Lien prohibited by this Agreement; except in the case of clauses (b) and (c), to the extent such contravention, conflict, breach or violation could not reasonably be expected to have a Material Adverse Effect.

5.03 Governmental Authorization; Other Consents. No material approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, the Borrower of this Agreement or any other Loan Document.

5.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by the Borrower. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, subject to Debtor Relief Laws and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

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5.05 Financial Statements.

(a) The following representation and warranty shall apply to the Initial Financial Statements and to financial statements delivered pursuant to Section 6.01(a): (i) such financial statements were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (ii) fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein.

(b) The following representation and warranty shall be applicable to financial statements delivered pursuant to Section 6.01(b): the unaudited consolidated financial statements of the Borrower and its Subsidiaries dated as of the applicable quarter-end date and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the fiscal quarter ended on that date (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, and (ii) fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments.

5.06 Litigation. Except as disclosed in the Registration Statement, there are no actions, suits, proceedings, investigations, claims or disputes pending or, to the knowledge of the Borrower threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower or any of its Subsidiaries or against any of their properties or revenues that (a) challenge the legality, validity or enforceability of this Agreement or any other Loan Document and are non-frivolous in the reasonable judgment of the Administrative Agent and the Arrangers, or (b) as to which there is a reasonable probability of an adverse determination and that, if determined adversely, either individually or in the aggregate could reasonably be expected to have a Material Adverse Effect; provided that this representation, when made, shall not constitute an admission that any action, suit, proceeding, investigation, claim or dispute set forth or disclosed in the Registration Statement could reasonably be expected to result in a Material Adverse Effect due to an adverse determination, if any.

5.07 No Default. Neither the Borrower nor any Subsidiary is in default under or with respect to any Contractual Obligation that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document.

5.08 Ownership of Property; Liens. Each of the Borrower and each Subsidiary has good record and marketable title in fee simple to, or valid leasehold interests in (or other right to occupy), all real property necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The property of the Borrower and its Subsidiaries is subject to no Liens, other than Liens permitted by Section 7.01.

5.09 Environmental Compliance. The Borrower and its Subsidiaries conduct in the ordinary course of business a review of claims alleging potential liability or responsibility for violation of any Environmental Law on their respective businesses, operations and properties, and as a result thereof, the Borrower has reasonably concluded that, except as disclosed in the Registration Statement, such claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Borrower and its Subsidiaries are in compliance with applicable Environmental Laws except to the extent non-compliance could not, individually or in the aggregate, reasonably be expected to have a

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Material Adverse Effect. The Borrower and each of its Subsidiaries have obtained or have applied for all material licenses, permits, authorizations and registrations required under any Environmental Law (“Environmental Permits”) necessary for its operations, and all such Environmental Permits are in good standing, and the Borrower and each of its Subsidiaries is in compliance with all terms and conditions of such Environmental Permits, except to the extent that the failure to possess, or be in compliance with, any of the foregoing would not reasonably be expected to have a Material Adverse Effect.

5.10 Insurance. The properties of the Borrower and its Subsidiaries are either covered by self-insurance meeting the criteria set forth in Section 6.07 or are insured with financially sound and reputable insurance companies (determined at the time the applicable insurance was obtained or renewed), in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Borrower or the applicable Subsidiary operates.

5.11 Taxes. The Borrower and its Subsidiaries have filed all Federal and other material tax returns and reports required to be filed, and have paid all material Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable, except (i) those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with GAAP or (ii) where the failure to make such filing or payment would not be reasonably be expected to have a Material Adverse Effect. There is no proposed tax assessment against the Borrower or any Subsidiary that would, if made, have a Material Adverse Effect.

5.12 ERISA Compliance.

(a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the best knowledge of the Borrower, nothing has occurred which would prevent, or cause the loss of, such qualification. The Borrower and each ERISA Affiliate have made all required contributions to each Plan subject to the Pension Funding Rules, and no application for a funding waiver under the Pension Funding Rules or an extension of any amortization period pursuant to the Pension Funding Rules has been made with respect to any Plan.

(b) There are no pending or, to the best knowledge of the Borrower, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected to result in a Material Adverse Effect.

(c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability which, when aggregated with the Unfunded Pension Liability of all other Pension Plans, could reasonably be expected to have a Material Adverse Effect; (iii) neither the Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither the Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the Borrower nor any ERISA Affiliate has engaged in a transaction that could be subject to Sections 4069 or 4212(c) of ERISA.

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5.13 Subsidiaries. As of the Closing Date, the Borrower has no Subsidiaries other than those specifically disclosed in Part (a) of Schedule 5.13 and has no equity investments in any other corporation or entity other than those specifically disclosed in Part (b) of Schedule 5.13, in each case as supplemented by the supplement, if any, delivered pursuant to Section 4.02(a)(v).

5.14 Margin Regulations; Investment Company Act.

(a) The Borrower is not engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock. Following the application of the proceeds of each Borrowing and each drawing under a Letter of Credit, not more than 25% of the value of the assets (either of the Borrower only or of the Borrower and its Subsidiaries on a consolidated basis) subject to the provisions of Section 7.01 or subject to any restriction contained in any agreement or instrument between the Borrower and any Lender or any Affiliate of any Lender relating to Indebtedness and within the scope of Section 8.01(e) will be margin stock.

(b) None of the Borrower, any Person Controlling the Borrower, or any Subsidiary (i) is or is required to be registered as an “investment company” under the Investment Company Act of 1940, or (ii) is subject to regulation under the Federal Power Act, the Interstate Commerce Act, any state public utilities code or any other Federal or state statute or regulation limiting its ability to incur Indebtedness hereunder.

5.15 Disclosure. The Borrower has disclosed to the Administrative Agent and the Lenders all agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. For purposes of this Section 5.15, information that is disclosed in a Form 10-K, 10-Q, 8-K, or definitive proxy materials filed by the Borrower with the SEC shall be deemed to have been disclosed to the Administrative Agent and the Lenders. No written report, financial statement, certificate or other information (excluding projections, industry or general economic data or information and other forward looking information) furnished (in writing) by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time such projected financial information was prepared.

5.16 Compliance with Laws. Each of the Borrower and each Subsidiary is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.17 [Reserved].

5.18 Intellectual Property; Licenses, Etc. The Borrower and its Subsidiaries own, or possess the right to use, all of the trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, intellectual property licenses and other intellectual property rights that are reasonably necessary for the operation of their respective businesses, and, to the knowledge of the Borrower, such

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ownership or right to use is without conflict with the rights of any other Person (except to the extent such conflict would not reasonably be expected to have a Material Adverse Effect). To the knowledge of the Borrower, no slogan or other advertising device, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by the Borrower or any Subsidiary infringes upon any rights held by any other Person (except to the extent such infringement would not reasonably be expected to have a Material Adverse Effect). No claim or litigation regarding any of the foregoing is pending or, to the best knowledge of the Borrower, threatened, which, either individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

5.19 OFAC. Neither the Borrower, nor any of its Subsidiaries, nor, to the knowledge of the Borrower and its Subsidiaries, any director, officer, employee, agent, affiliate or representative thereof, is an individual or entity currently the subject of any Sanctions, nor is the Borrower or any Subsidiary located, organized or resident in a Designated Jurisdiction.

5.20 Certain Representations and Warranties with respect to the ONE Gas Separation Transactions.

(a) The ONE Gas Separation Transactions are within the Borrower’s corporate powers and have been duly authorized by all necessary corporate action.

(b) All partnership and company consents and approvals and all material governmental and third-party consents and approvals necessary in connection with the ONE Gas Separation Transactions have been obtained and are in full force and effect (including the declaration by the SEC that the Registration Statement is effective), and all applicable waiting periods have expired without any action being taken or threatened by any governmental, regulatory or other similar authority which would restrain in a materially adverse manner or prevent or otherwise impose materially adverse conditions on the ONE Gas Separation Transactions.

(c) The ONE Gas Separation Transactions have been consummated in all material respects (i) as described in the Registration Statement, and (ii) in compliance with applicable Laws and regulatory approvals.

ARTICLE VI.

AFFIRMATIVE COVENANTS

From and after the Closing Date and for so long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Borrower shall, and shall (except in the case of the covenants set forth in Sections 6.01, 6.02, 6.03 and 6.11) cause each Subsidiary to:

6.01 Financial Statements. Deliver to the Administrative Agent:

(a) as soon as available, but in any event within 90 days after the end of the fiscal year of the Borrower ending December 31, 2014 and of each fiscal year of the Borrower thereafter, a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and prepared in accordance with GAAP, audited and accompanied by a report and opinion of an independent certified public accountant of nationally recognized standing which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit;

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(b) as soon as available, but in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal quarter, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal quarter and for the portion of the Borrower’s fiscal year then ended, setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail and certified by a Responsible Officer of the Borrower as fairly presenting the financial condition, results of operations, shareholders’ equity and cash flows of the Borrower and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes; and

(c) as soon as available, but in any event within 90 days after December 31, 2013, the Year-End 2013 Financial Statements.

As to any information contained in materials furnished pursuant to Section 6.02(c), the Borrower shall not be separately required to furnish such information under clause (a), (b) or (c) above, but the foregoing shall not be in lieu of the obligation of the Borrower to furnish the information and materials described in subsections (a), (b) or (c) above at the times specified therein.

6.02 Certificates; Other Information. Deliver to the Administrative Agent:

(a) concurrently with the delivery of the financial statements referred to in Sections 6.01(a) and (b), (or if such financial statements are delivered electronically, within two (2) Business Days of such electronic delivery) a duly completed Compliance Certificate signed by a Responsible Officer of the Borrower (which delivery may, unless the Administrative Agent, or a Lender requests executed originals, be by electronic communication including fax or email and shall be deemed to be an original authentic counterpart thereof for all purposes);

(b) promptly after any request by the Administrative Agent or any Lender, copies of any detailed audit reports, management letters or recommendations submitted to the board of directors (or the audit committee of the board of directors) of the Borrower by independent accountants in connection with the accounts or books of the Borrower or any Subsidiary, or any audit of any of them;

(c) promptly after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of the Borrower, and copies of all annual, regular, periodic and special reports, and all registration statements which the Borrower may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to the Administrative Agent pursuant hereto; and

(d) promptly, such additional information regarding the business, financial or corporate affairs of the Borrower or any Subsidiary, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may from time to time reasonably request;

provided further that disclosure of confidential information pursuant to subsections (b) and (d) shall be subject to (1) such attorney-client privilege exceptions that the Borrower reasonably determines are necessary in order to avoid loss of its attorney-client privilege and (2) compliance with reasonable conditions to disclosure under non-disclosure agreements between the Borrower (or a Subsidiary) and Person(s) other than Affiliates thereof, and to the extent that the Administrative Agent or a Lender is required to produce any such information to a regulatory authority, the Borrower shall cooperate with the Administrative Agent or such Lender in efforts to obtain any required consents to disclosure.

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Documents required to be delivered pursuant to Section 6.01(a), (b) or (c) or Section 6.02(c) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) (A) after which the Borrower posts such documents, or provides a link thereto on the Borrower’s website on the Internet at the website address listed on Schedule 10.02; or (B) after which such documents are posted on the Borrower’s behalf on IntraLinks/IntraAgency or another relevant website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent), and (ii) the Borrower notifies (which may be by facsimile or electronic mail) the Administrative Agent of the posting of any such documents; provided that the Borrower shall deliver paper copies or soft copies (by electronic mail) of such documents to the Administrative Agent or any Lender that requests the Borrower to deliver such paper copies or soft copies until a written request to cease delivering paper copies or soft copies is given by the Administrative Agent or such Lender. The Administrative Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

The Borrower hereby acknowledges that (1) the Administrative Agent and/or the Arrangers will make available to the Lenders and the L/C Issuers materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on IntraLinks, Debt Domain, Syndtrak or another similar electronic system (the “Platform”) and (2) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Borrower or its securities) (each, a “Public Lender”). The Borrower hereby agrees that (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, the Arrangers, the L/C Issuers and the Lenders to treat such Borrower Materials as either publicly available information or not material information (although it may be sensitive and proprietary) with respect to the Borrower or its securities for purposes of United States Federal and state securities laws; (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Administrative Agent and the Arrangers shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor,” provided, however, that notwithstanding the foregoing, the Borrower shall not have any obligation to mark any Borrower Materials as “PUBLIC.”

6.03 Notices. Notify the Administrative Agent and each Lender:

(a) promptly, of the occurrence of any Default and the action which the Borrower is taking or proposes to take with respect thereto;

(b) promptly, and in any event within five (5) days:

(i) of any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect, including (to the extent resulting or such matter could reasonably be expected to result in a Material Adverse Effect) (A) breach or non-performance of, or any default under, a Contractual Obligation of the Borrower or any Subsidiary; (B) any dispute, litigation, investigation, proceeding or suspension between the Borrower or any Subsidiary and any Governmental Authority; or (C) the commencement of, or any material development in, any litigation or proceeding affecting the Borrower or any Subsidiary, including pursuant to any applicable Environmental Laws;

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(ii) of the commencement of, or any material development in, any litigation or proceeding affecting the Borrower or any Subsidiary (A) in which the amount of damages claimed is $100,000,000 (or its equivalent in another currency or currencies) or more, (B) in which injunctive or similar relief is sought and which could reasonably be expected to result in a Material Adverse Effect, or (C) in which the relief sought is an injunction or other stay of the performance of this Agreement or any Loan Document;

(iii) of any material change in accounting policies or financial reporting practices by the Borrower or any Subsidiary; and

(iv) of any announcement by Moody’s or S&P of any downgrade in a Debt Rating;

(c) promptly, and in any event within 30 days:

(i) of the occurrence of any ERISA Event; or

(ii) upon determining that any Pension Plan is considered an at-risk plan or a plan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 of ERISA (in such case, notice shall include a certification of funding status from the enrolled actuary for the Pension Plan).

Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and stating what action the Borrower has taken and proposes to take with respect thereto. Each notice pursuant to Section 6.03(a) shall describe with particularity any and all provisions of this Agreement and any other Loan Document that have been breached.

6.04 Payment of Obligations. Pay and discharge as the same shall become due and payable, its Indebtedness and tax liabilities but excluding Indebtedness (other than the Obligations) that is not in excess of the Threshold Amount, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Borrower or such Subsidiary or failure to do so would not reasonably be expected to result in a Material Adverse Effect.

6.05 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 7.04, (b) take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and (c) preserve or renew all of its registered patents, trademarks, trade names and service marks, the non-preservation of which could reasonably be expected to have a Material Adverse Effect.

6.06 Maintenance of Properties. (a) Maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear, force majeure and casualty events excepted and (b) make all necessary repairs thereto and renewals and replacements thereof, except where, in each case, the failure to do so could not reasonably be expected to have a Material Adverse Effect.

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6.07 Maintenance of Insurance. Maintain with financially sound and reputable insurance companies (determined at the time the applicable insurance is maintained or renewed), or through self-insurance, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, of such types and in such amounts as are customarily carried under similar circumstances by such other Persons. Such insurance may include self-insurance or be subject to co-insurance, deductibility or similar clauses which, in effect, result in self-insurance of certain losses, provided that such self-insurance is in accord with the approved practices of business enterprises of established reputation similarly situated and adequate insurance reserves are maintained in connection with such self-insurance, and, notwithstanding the foregoing provisions of this Section 6.07, the Borrower may effect workers’ compensation or similar insurance in respect of operations in any state or other jurisdiction any through an insurance fund operated by such state or other jurisdiction or by causing to be maintained a system or systems of self-insurance in accord with applicable laws.

6.08 Compliance with Laws. Comply in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted, or (b) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.

6.09 Books and Records. (a) Maintain proper books of record and account, in which full, true and correct entries in conformity in all material respects with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Borrower or such Subsidiary, as the case may be; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over the Borrower or such Subsidiary, as the case may be.

6.10 Inspection Rights. Permit representatives and independent contractors of the Administrative Agent and each Lender to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with its officers and independent public accountants (provided Borrower has the opportunity to participate in such meetings), all at the expense of the Borrower and at such reasonable times during normal business hours and as often as may be reasonably desired, upon reasonable advance notice to the Borrower; provided, however, that (x) when an Event of Default exists the Administrative Agent or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of the Borrower at any time during normal business hours and without advance notice; and (y) disclosure of confidential information pursuant to this Section shall be subject to (x) such attorney-client privilege exceptions that the Borrower reasonably determines are necessary in order to avoid loss of its attorney –client privilege and (y) compliance with reasonable conditions to disclosure under non-disclosure agreements between the Borrower (or a Subsidiary) and Person(s) other than Affiliates thereof, and to the extent that the Administrative Agent or a Lender is required to produce any such information to a regulatory authority, the Borrower shall cooperate with the Administrative Agent or such Lender in efforts to obtain any required consents to disclosure.

6.11 Use of Proceeds. Use the proceeds of the Credit Extensions for the payment of fees and expenses incurred in connection with the ONE Gas Separation Transactions, working capital, capital expenditures, acquisitions, mergers, and other general corporate purposes (including repayment of indebtedness and payment of dividends) not in contravention of any Law or of any Loan Document; provided however, no portion of the proceeds of any Credit Extension will be used in any manner prohibited by Section 7.08.

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6.12 Sanctions. Not permit the use of the proceeds of any Credit Extension, whether direct or indirect, or the direct or indirect lending, contributing or otherwise making available of such proceeds to any Subsidiary, joint venture partner or other individual or entity, to fund any activities of or business with any individual, entity or vessel, or in any Designated Jurisdiction, that, at the time of such funding, is the subject of Sanctions, or in any other manner that will result in a violation by any individual or entity (including any individual or entity participating in the transaction, whether as Lender, Arranger, Administrative Agent, L/C Issuer, Swing Line Lender, or otherwise) of Sanctions.

ARTICLE VII.

NEGATIVE COVENANTS

From and after the Closing Date and for so long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding:

7.01 Liens. The Borrower shall not, and shall not permit any Subsidiary to, create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than the following:

(a) Liens pursuant to any Loan Document (including any documents entered into in order to Cash Collateralize L/C Obligations);

(b) Liens for taxes not yet due or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;

(c) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business which are not overdue for a period of more than 30 days or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person;

(d) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation, other than any Lien imposed by ERISA;

(e) deposits to secure the performance of bids, trade contracts and leases (other than Indebtedness), statutory obligations, surety bonds (other than bonds related to judgments or litigation), performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(f) any right which any municipal or governmental body or agency may have by virtue of any franchise, license, contract or status to purchase or designate a purchaser of, or order the sale of, any property of the Borrower or a Subsidiary upon payment of reasonable compensation therefor or to terminate any franchise, license or other rights or to regulate the property and business of the Borrower or a Subsidiary;

(g) any Liens, neither assumed by the Borrower or a Subsidiary nor on which it customarily pays interest, existing upon real estate or rights in or relating to real estate acquired by the Borrower or a Subsidiary for sub-station, measuring station, regulating station, gas purification station, compressor station, transmission line, distribution line or right-of-way purposes;

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(h) easements or reservations in any property of the Borrower or a Subsidiary for the purpose of roads, pipe lines, gas transmission and distribution lines, electric light and power transmission and distribution lines, water mains and other like purposes, and zoning ordinances, regulations and restrictions which do not impair the use of such property in the operation of the business of the Borrower or a Subsidiary;

(i) easements, rights-of-way, restrictions and other similar encumbrances affecting real property which, in the aggregate, are not substantial in amount, and which do not in any case materially interfere with the ordinary conduct of the business of the Borrower and its Subsidiaries taken as a whole;

(j) Liens securing judgments for the payment of money not constituting an Event of Default under Section 8.01(h) or securing appeal or other surety bonds related to such judgments;

(k) (i) Liens securing Indebtedness in respect of Capital Lease Obligations, Synthetic Lease Obligations and purchase money obligations for fixed or capital assets, provided that (A) such Liens do not at any time encumber any property other than the property financed by such Indebtedness, (B) the Indebtedness secured thereby does not exceed the cost of the property being acquired on the date of acquisition, and (C) such Liens attach to such property concurrently with or within 90 days after the acquisition thereof, and (ii) Liens securing any refinancing (including successive refinancings) of such Indebtedness, provided that such Liens do not extend to additional property and the amount of the Indebtedness is not increased (except by an amount not to exceed fees, premiums and interest relating to such refinancing); provided further that the principal amount of the Indebtedness secured by Liens permitted by this clause (k) shall not in the aggregate at any time exceed 2.5% of the Total Capital of the Borrower and its Subsidiaries;

(l) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with or acquired by the Borrower or any Subsidiary of the Borrower; provided that such Liens were not granted in contemplation of, and were in existence prior to, such merger, consolidation or acquisition and do not extend to any assets other than those of the Person merged into or consolidated with the Borrower or the Subsidiary that were encumbered prior to such merger, consolidation or acquisition;

(m) Liens on property existing at the time of acquisition of the property by the Borrower or any Subsidiary of the Borrower; provided that such Liens were not granted in contemplation of, and were in existence prior to, the contemplation of such acquisition and no such Lien may encumber any other property of the Borrower or any Subsidiary;

(n) Liens incurred to refinance any Indebtedness of the Borrower or its Subsidiaries which has been secured by Liens otherwise permitted hereunder under clauses (l) and (m); provided that such Liens do not extend to any property other than the property securing the Indebtedness refinanced and the amount of the Indebtedness secured thereby is not increased (except by an amount not to exceed fees, premiums and interest relating to such refinancing);

(o) Liens on cash and cash equivalents granted pursuant to master netting agreements entered into in the ordinary course of business in connection with Swap Contracts; provided that (i) the transactions secured by such Liens are governed by standard International Swaps and Derivatives Association, Inc. documentation, and (ii) such Swap Contracts consist of derivative transactions contemplated to be settled in cash and not by physical delivery and are designed to minimize the risk of fluctuations in oil and gas prices with respect to the Borrower’s and its Subsidiaries’ operations in the ordinary course of its business;

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(p) Liens pursuant to master netting agreements entered into in the ordinary course of business in connection with Swap Contracts, in each case pursuant to which the Borrower or a Subsidiary of the Borrower, as a party to such master netting agreement and as pledgor, pledges or otherwise transfers to the other party to such master netting agreement, as pledgee, in order to secure the Borrower’s or such Subsidiary’s obligations under such master netting agreement, a Lien upon and/or right of set off against, all right, title, and interest of the pledgor in any obligations of the pledgee owed to the pledgor, together with all accounts and general intangibles and payment intangibles in respect of such obligations and all dividends, interest, and other proceeds from time to time received, receivable, or otherwise distributed in respect of, or in exchange for, any or all of the foregoing;

(q) Liens arising in the ordinary course of business under Oil and Gas Agreements to secure compliance with such agreements, provided that any such Lien referred to in this clause are for claims which are not delinquent or which are being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP, and provided further that any such Lien referred to in this clause does not materially impair the use of the property covered by such Lien for the purposes for which such property is held by the Borrower or any Subsidiary or materially impair the value of such property subject thereto, and provided further that such Liens are limited to property that is the subject of the relevant Oil and Gas Agreement;

(r) bankers’ Liens, rights of setoff and other similar Liens existing with respect to cash and cash equivalents on deposit in one or more accounts maintained by the Borrower or any Subsidiary, in each case arising in the ordinary course of business in favor of the bank or banks with which such accounts are maintained; and

(s) Liens not otherwise permitted by this Section 7.01 securing Indebtedness of the Borrower or its Subsidiaries, provided that the aggregate outstanding principal amount of all such Indebtedness does not at any time exceed 15% of Consolidated Net Tangible Assets.

7.02 Investments. The Borrower shall not, and shall not permit any Subsidiary to, make any Investments, except:

(a) Investments held by the Borrower or such Subsidiary in the form of cash and cash equivalents;

(b) advances to officers, directors and employees of the Borrower and Subsidiaries in the ordinary course of business in accordance with applicable law for travel, entertainment, relocation and analogous ordinary business purposes;

(c) Investments of the Borrower in any wholly-owned Subsidiary and Investments of any wholly-owned Subsidiary in the Borrower and any wholly-owned Subsidiary;

(d) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss;

(e) Investments in the capital stock, equity interest, assets, obligations or other securities of, or interest in, Subsidiaries, joint ventures or other Persons, in each case which are engaged principally in the business described in Section 7.05 or other businesses reasonably related or incidental thereto; provided that such Investments are not opposed by the board of directors or management of such Person;

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(f) Investments of a Person acquired after the Closing Date or of a Person merged or consolidated with or into Borrower or a Subsidiary; provided that such Investments were not made in contemplation of, and were in existence prior to, such acquisition, merger or consolidation; and

(g) other Investments, if at the time of, and after giving effect to, such Investments, the aggregate book value of all such Investments does not exceed $100,000,000 in the aggregate.

7.03 Indebtedness of Subsidiaries. The Borrower shall not permit any Subsidiary to create, incur, assume or suffer to exist any Indebtedness, except:

(a) Indebtedness owed to the Borrower or to another Subsidiary;

(b) obligations under Swap Contracts, provided that such obligations are (or were) entered into by such Subsidiary in the ordinary course of business for the purpose of directly mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Subsidiary, or changes in the value of securities issued by such Subsidiary, and not for purposes of speculation or taking a “market view;”

(c) Indebtedness secured by Liens permitted by Section 7.01(s), provided that the aggregate outstanding principal amount of such Indebtedness does not at any time exceed the amount permitted by such Section;

(d) Indebtedness existing at the time of acquisition of any new Subsidiary by the Borrower or by a then-existing Subsidiary of the Borrower; provided that such Indebtedness was not incurred in contemplation of, and was in existence prior to, such acquisition and that neither the Borrower nor any other Subsidiary of the Borrower has any liability under such Indebtedness (other than a Subsidiary of any Person so acquired); and

(e) Indebtedness of Subsidiaries of the Borrower (excluding Indebtedness otherwise permitted in clauses (a) through (d) of this Section 7.03) which does not exceed at any time an aggregate principal amount outstanding equal to fifteen percent (15%) of Consolidated Net Tangible Assets.

7.04 Fundamental Changes. The Borrower shall not dissolve, liquidate, or merge or consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of the assets of the Borrower and its Restricted Subsidiaries taken as a whole (whether now owned or hereafter acquired), except that, so long as no Default exists or would result therefrom, the Borrower may consolidate or merge with a corporation or other entity, and a Person may consolidate with or merge into the Borrower, provided that (x) the Borrower shall be the continuing or surviving entity, and (y) in each case (i) the surviving entity shall be after the merger a solvent corporation organized and existing under the laws of the United States of America, any State thereof or the District of Columbia, (ii) immediately after giving effect to such transaction and treating any Indebtedness which becomes an obligation of the Borrower or a Subsidiary as a result of such transaction as having been incurred by the Borrower or such Subsidiary at the time of such transaction, no Default shall have happened and be continuing, and (iii) the Borrower has delivered to the Administrative Agent a certificate signed by a Responsible Officer and an opinion of counsel, each stating that such consolidation or merger complies with this Section 7.04 and such certificate shall additionally state that, in the opinion of the board of directors of the Borrower, the transaction is in the interest of the Borrower.

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7.05 Change in Nature of Business. The Borrower shall not, and shall not permit any Subsidiary to, engage in any material line of business other than the natural gas distribution business and other natural gas related businesses.

7.06 Transactions with Affiliates. The Borrower shall not, and shall not permit any Subsidiary to, enter into any transaction of any kind with any Affiliate of the Borrower, whether or not in the ordinary course of business, other than (a) on fair and reasonable terms substantially as favorable to the Borrower or such Subsidiary as would be obtainable by the Borrower or such Subsidiary at the time in a comparable arm’s length transaction with a Person other than an Affiliate, and (b) transactions between or among the Borrower and one or more wholly-owned Subsidiaries of the Borrower, not involving any Affiliates other than the Borrower and wholly-owned Subsidiaries of the Borrower.

7.07 Burdensome Agreements. The Borrower shall not, and shall not permit any Subsidiary to, enter into or permit any Contractual Obligation that limits the ability of any Subsidiary to pay dividends or make other payments or distributions to the Borrower or to any other Subsidiary or to otherwise transfer property to the Borrower; unless (i) none of such limitations, either individually or in the aggregate, would materially restrict the ability of the Subsidiaries taken as a whole to pay dividends or make other payments or distributions to the Borrower or otherwise transfer property to the Borrower and (ii) each such limitation, individually and in the aggregate with all other such limitations, could not reasonably be expected to impair the ability of the Borrower to perform its monetary obligations hereunder.

7.08 Use of Proceeds. The Borrower shall not

(a) Use the proceeds of any Credit Extension, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose; or

(b) use the proceeds of any Credit Extension in connection with the acquisition of a voting interest of five percent or more in any Person if such acquisition is opposed by the board of directors or management of such Person.

7.09 Debt to Capital. The Borrower shall not permit Consolidated Total Indebtedness on the last day of any calendar quarter, beginning with the first such date to occur after the Closing Date, or if the Closing Date is on the last day of a calendar quarter, beginning on such date, to exceed 70% of Total Capital. For purposes of determining compliance with this Section 7.09, Hybrid Securities up to an aggregate amount of 10% of Total Capital shall be excluded from Consolidated Total Indebtedness and shall be added to Consolidated Net Worth.

ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES

8.01 Events of Default. Any of the following shall constitute an Event of Default:

(a) Non-Payment. The Borrower fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan or any L/C Obligation, (ii) within five days after the same becomes due, any interest on any Loan or on any L/C Obligation, or any Facility Fee or other fee due hereunder, or (iii) within five Business Days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or

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(b) Specific Covenants. The Borrower fails to perform or observe any term, covenant or agreement contained in any of Section 6.03(a), 6.05(a), 6.11, 7.01, 7.03 or 7.09 or clause (x) of Section 7.04; or

(c) Other Defaults. The Borrower fails to perform or observe any other covenant or agreement (not specified in subsection (a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days; or

(d) Representations and Warranties. Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the Borrower, in any other Loan Document, or in any document delivered in connection herewith or therewith shall be incorrect or misleading in any material respect when made or deemed made (except that such materiality qualifier shall not apply to the extent that any such representation or warranty is qualified by materiality); or

(e) Payment Cross-Default and Cross-Acceleration. (i) The Borrower or any Subsidiary fails to make any payment when due after the expiration of any applicable grace period (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee of Indebtedness (other than Indebtedness hereunder and Indebtedness under Swap Contracts) having an aggregate principal amount (including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than the Threshold Amount; (ii) the Borrower or any Subsidiary fails to observe or perform any other agreement or condition relating to any such Indebtedness or Guarantee of Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other event is to cause the maturity of such Indebtedness to be accelerated or require such Indebtedness to be prepaid prior to the stated maturity thereof; or (iii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under such Swap Contract as to which the Borrower or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which the Borrower or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by the Borrower or such Subsidiary as a result thereof is greater than the Threshold Amount; or

(f) Insolvency Proceedings, Etc. The Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary) institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or the Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary)shall take any corporate action in furtherance of any of the foregoing; or

(g) Inability to Pay Debts; Attachment. (i) The Borrower or any Subsidiary (other than any Immaterial Subsidiary) becomes unable or admits in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the property of any such Person and is not released, vacated or fully bonded within 30 days after its issue or levy; or

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(h) Judgments. There is entered against the Borrower or any Subsidiary (other than any Immaterial Subsidiary) (i) one or more final judgments or orders for the payment of money in an aggregate amount (as to all such judgments or orders) exceeding the Threshold Amount (to the extent not covered by independent third-party insurance), or (ii) any one or more non-monetary final judgments that have, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and, in either case, (A) enforcement proceedings are commenced by any creditor upon such judgment or order, or (B) there is a period of ten (10) consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or

(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected to result in liability of the Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold Amount, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or

(j) Invalidity of Loan Documents. Any Loan Document, at any time after its execution and delivery and for any reason other than as permitted hereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or the Borrower or any of its Affiliates contests in any manner the validity or enforceability of any Loan Document; or the Borrower denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document other than pursuant to the terms thereof; or

(k) Change of Control. There occurs any Change of Control with respect to the Borrower.

8.02 Remedies Upon Event of Default. If any Event of Default occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions:

(a) declare the commitment of each Lender to make Loans and any obligation of each L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments and obligation shall be terminated;

(b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower;

(c) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and

(d) exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents or applicable law;

provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the obligation of each Lender to make Loans and any obligation of each L/C Issuer to make L/C Credit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Borrower to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.

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8.03 Application of Funds . After the exercise of remedies provided for in Section 8.02 (or after the Loans have automatically become immediately due and payable and the L/C Obligations have automatically been required to be Cash Collateralized as set forth in the proviso to Section 8.02), any amounts received on account of the Obligations shall, subject to the provisions of Section 2.04(g) and Section 2.17, be applied by the Administrative Agent in the following order:

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including Attorney Costs and amounts payable under Article III) payable to the Administrative Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders (including Attorney Costs and amounts payable under Article III), ratably among them in proportion to the amounts described in this clause Second payable to them;

Third, to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans, L/C Borrowings and other Obligations, ratably among the Lenders in proportion to the respective amounts described in this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and L/C Borrowings, ratably among the Lenders in proportion to the respective amounts described in this clause Fourth held by them;

Fifth, to the Administrative Agent for the account of each L/C Issuer, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit; and

Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or as otherwise required by Law.

Subject to Section 2.04(c), amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth above shall be applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on deposit as Cash Collateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied in the order set forth above.

ARTICLE IX.

ADMINISTRATIVE AGENT

9.01 Appointment and Authority. Each of the Lenders and the L/C Issuers hereby irrevocably appoints Bank of America to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the L/C Issuers, and the Borrower shall not be subject to and shall not have rights as a third party beneficiary of any of such provisions (except with respect to Section 9.06). It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

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9.02 Rights as a Lender. The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

9.03 Exculpatory Provisions. The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, the Administrative Agent:

(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and

(c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given in writing to the Administrative Agent by the Borrower, a Lender or a L/C Issuer.

The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

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9.04 Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance, extension, renewal or increase of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or a L/C Issuer, the Administrative Agent may presume that such condition is satisfactory to such Lender or such L/C Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender or such L/C Issuer prior to the making of such Loan or the issuance of such Letter of Credit. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

9.05 Delegation of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agents.

9.06 Resignation of Administrative Agent.

(a) The Administrative Agent may at any time give notice of its resignation to the Lenders, the L/C Issuers and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, with the prior written consent of the Borrower (provided such consent shall not be unreasonably withheld or delayed and no such consent shall be required if an Event of Default has occurred and is continuing), to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by the Required Lenders) (the “Resignation Effective Date”), then the retiring Administrative Agent may on behalf of the Lenders and the L/C Issuers, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice.

(b) If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, the Required Lenders may, to the extent permitted by applicable law, by notice in writing to the Borrower and such Person remove such Person as Administrative Agent and, with the prior written consent of the Borrower (provided such consent shall not be unreasonably withheld or delayed and no such consent shall be required if an Event of Default has occurred and is continuing), appoint a successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date. As used in this Section 9.06, the terms “retiring” and “retired” shall include “removed”.

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(c) With effect from the Resignation Effective Date or the Removal Effective Date (as applicable) (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders or the L/C Issuers under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (2) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and each L/C Issuer directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Administrative Agent’s resignation or removal, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

Any resignation or removal by Bank of America as Administrative Agent pursuant to this Section shall also constitute its resignation as L/C Issuer and Swing Line Lender. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer and Swing Line Lender, (b) the retiring L/C Issuer and Swing Line Lender shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents, and (c) the successor L/C Issuer shall, or another L/C Issuer may, issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangement satisfactory to the retiring L/C Issuer to effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit.

9.07 Non-Reliance on Administrative Agent and Other Lenders. Each Lender and each L/C Issuer acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and each L/C Issuer also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

9.08 Administrative Agent May File Proofs of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Borrower, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise

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(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the L/C Issuers and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuers and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the L/C Issuers and the Administrative Agent under Sections 2.04(i) and (j), 2.10, and 10.04) allowed in such judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and each L/C Issuer to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the L/C Issuers, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.10 and 10.04.

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or any L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

9.09 Release of Lien on Cash Collateral Upon Expiration of Letters of Credit. The Lenders irrevocably authorize the Administrative Agent to release its Lien on Cash Collateral (x) at such time as all Letters of Credit have expired, all Obligations have been paid in full, and the Aggregate Commitments have terminated or (y) pursuant to the last paragraph of Section 2.04(g).

9.10 Other Agents; Arrangers and Managers. None of the Lenders or other Persons identified on the facing page or signature pages of this Agreement as a “syndication agent,” “documentation agent,” “joint lead arranger and joint book manager” shall have any right, power, obligation, liability, responsibility or duty under this Agreement except in its capacity, if applicable, as the Administrative Agent, a Lender, or a L/C Issuer hereunder. Without limiting the foregoing, none of the Lenders or other Persons so identified shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely, on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or in taking or not taking action hereunder.

ARTICLE X.

MISCELLANEOUS

10.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Borrower therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower, and acknowledged by the Administrative Agent (which acknowledgment shall be solely administrative in nature), and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no such amendment, waiver or consent shall:

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(a) waive any condition set forth in Sections 4.01 or 4.02 or permit the Closing Date to be later than March 31, 2014, without the written consent of each Lender;

(b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 8.02) without the written consent of such Lender;

(c) postpone any date fixed by this Agreement or any other Loan Document for any payment or mandatory prepayment of principal, interest, fees or other amounts due to the Lenders (or any of them) or any mandatory reduction of the Aggregate Commitments hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

(d) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (v) of the second proviso to this Section 10.01) any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest or Letter of Credit Fees at the Default Rate;

(e) change Section 2.14 or Section 8.03 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender; or

(f) change any provision of this Section or the percentages contained in the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;

and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuers in addition to the Lenders required above, affect the rights or duties of the L/C Issuers under this Agreement or any Letter of Credit Application relating to any Letter of Credit issued or to be issued by any of them; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Lenders required above, affect the rights or duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; (iv) Section 10.06(i) may not be amended, waived or otherwise modified without the consent of each Granting Lender all or any part of whose Loans are being funded by an SPC at the time of such amendment, waiver or other modification; and (v) a Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto. Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of a Defaulting Lender may not be increased or extended, the principal amount of any Loan or any interest thereon, or any other amounts payable hereunder, owed to such Defaulting Lender may not be reduced, and the date fixed by this Agreement or any other Loan Document for payment thereof may not be extended, without the consent of such Defaulting Lender, (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender, and (z) any waiver, amendment or modification changing the voting rights of a Defaulting Lender shall require the consent of each Lender that is a Defaulting Lender at the time that such waiver, amendment or modification becomes effective.

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If, in connection with any proposed change, waiver, consent, discharge or termination of or to any of the provisions of this Agreement as contemplated by this Section 10.01, the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained, then the Borrower shall have the right, to replace each such non-consenting Lender or Lenders with one or more (so long as all non-consenting Lenders are so replaced) persons pursuant to Section 10.14 so long as at the time of such replacement, each such new Lender consents to the proposed change, waiver, consent, discharge or termination. Each Lender agrees that, if the Borrower elects to replace such Lender in accordance with this Section, it shall promptly execute and deliver to the Administrative Agent an Assignment and Assumption to evidence such sale and purchase and shall deliver to the Administrative Agent any Note (if Notes have been issued in respect of such Lender’s Loans) subject to such Assignment and Assumption; provided that the failure of any such non-consenting Lender to execute an Assignment and Assumption shall not render such sale and purchase (and the corresponding assignment) invalid and such assignment shall be recorded in the Register.

10.02 Notices and Other Communications; Facsimile Copies.

(a) General. Unless otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including by facsimile transmission). All such written notices shall be mailed, faxed or delivered to the applicable address, facsimile number or (subject to subsection (c) below) electronic mail address, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i) if to the Borrower, the Administrative Agent, or the Swing Line Lender, to the address, facsimile number, electronic mail address or telephone number specified for such Person on Schedule 10.02 or to such other address, facsimile number, electronic mail address or telephone number as shall be designated by such party in a notice to the other parties; and

(ii) if to any other Lender or any L/C Issuer, to the address, facsimile number, electronic mail address or telephone number specified in its Administrative Questionnaire or to such other address, facsimile number, electronic mail address or telephone number as shall be designated by such party in a notice to the Borrower, the Administrative Agent, and the L/C Issuers.

Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices and other communications delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

(b) Electronic Communications. Notices and other communications to the Lenders and the L/C Issuers hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or any L/C Issuer pursuant to Article II if such Lender or such L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.

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Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause of notification that such notice or communication is available and identifying the website address therefor.

(c) Change of Address, Etc. Each of the Borrower, the Administrative Agent, and the Swing Line Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender and each L/C Issuer may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the Borrower, the Administrative Agent, the L/C Issuers and the Swing Line Lender. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender. Furthermore, each Public Lender (as defined in Section 6.02) agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Investor” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Investor” portion of the Platform and that may contain material non-public information with respect to the Borrower or its securities for purposes of United States Federal or state securities laws.

(d) Reliance by Administrative Agent, L/C Issuer and Lenders. The Administrative Agent, the L/C Issuers and the Lenders shall be entitled to rely and act upon any notices (including telephonic Committed Loan Notices and Swing Line Loan Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower shall indemnify the Administrative Agent, each L/C Issuer, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower except to the extent such losses, costs, expenses and liabilities are determined by a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of such Person. All telephonic notices to and other communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

(e) THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES AND THE ARRANGER PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY OR ANY ARRANGER PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its Related Parties (collectively, the

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“Agent Parties”) or any Arranger or any of their respective Related Parties (collectively, the “Arranger Parties”) have any liability to the Borrower, any Lender, any L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party or Arranger Party; provided, however, that in no event shall any Agent Party or Arranger Party have any liability to the Borrower, any Lender, any L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

10.03 No Waiver; Cumulative Remedies; Enforcement.

(a) No failure by any Lender or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

(b) Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Borrower shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with Section 8.02 for the benefit of all the Lenders; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) the L/C Issuer or the Swing Line Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as L/C Issuer or Swing Line Lender, as the case may be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 10.08 (subject to the terms of Section 2.14), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to the Borrower under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 8.02 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of the preceding proviso and subject to Section 2.14, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

10.04 Expenses; Indemnity; Damage Waiver.

(a) Costs and Expenses. The Borrower shall pay (i) all reasonable out of pocket expenses incurred by the Administrative Agent and its Affiliates (including the reasonable fees, charges and disbursements of outside counsel for the Administrative Agent), in connection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out of pocket expenses incurred by the L/C Issuers in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out of pocket expenses incurred by the Administrative Agent, any Lender or any L/C Issuer (including the fees, charges and disbursements of one primary outside counsel for the

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Administrative Agent, the Lenders and the L/C Issuers, and in the case of actual or potential conflict of interest, separate counsel for Indemnitees to the extent needed to avoid such conflict, and one firm of local counsel, as applicable, in any relevant jurisdiction, and in the case of actual or potential conflict of interest, separate local counsel for Indemnitees to the extent needed to avoid such conflict), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out of pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

(b) Indemnification by the Borrower. The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Arranger, each Arranger and Book Manager, each Syndication Agent, each Documentation Agent, each Lender and each L/C Issuer, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of one primary outside counsel for the Indemnitees and, in the case of actual or potential conflict of interest, separate counsel for Indemnitees to the extent needed to avoid such conflict), incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower arising out of, in connection with, or as a result of (i) the syndication and arrangement of the credit facility evidenced by this Agreement, the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) the ONE Gas Separation Transactions, (iii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by any L/C Issuer to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iv) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (v) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower, and regardless of whether any Indemnitee is a party thereto, in all cases, whether or not caused by or arising, in whole or in part, out of the comparative, contributory or sole negligence of the Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence, willful misconduct, bad faith or material breach by such Indemnitee of its obligations under this Agreement; and provided further that no Indemnitee (other than the Administrative Agent, each Arranger, each Arranger and Book Manager, each Documentation Agent, and each Syndication Agent, in each case in its capacity as such) will have a right to indemnification for such losses, claims, damages, liabilities or expenses to the extent they result from disputes among the Lenders other than as a result of any act or omission by the Borrower or any of its Affiliates. Without limiting the provisions of Section 3.01(c), this Section 10.04(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.

(c) Reimbursement by Lenders. To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), any L/C Issuer or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), such L/C Issuer or such Related Party, as the case may be, such Lender’s Pro Rata Share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent)

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or such L/C Issuer in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent) or any L/C Issuer in connection with such capacity. The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.13(d).

(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable law, the parties to this Agreement shall not assert, and hereby waive, any claim against any other party or Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby except to the extent caused by such Person’s gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

(e) Payments. All amounts due under this Section 10.04 shall be payable not later than ten Business Days after demand therefor.

(f) Survival. The agreements in this Section shall survive the resignation of the Administrative Agent, the L/C Issuer and the Swing Line Lender, the replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.

10.05 Payments Set Aside. To the extent that any payment by or on behalf of the Borrower is made to the Administrative Agent, any L/C Issuer or any Lender, or the Administrative Agent, any L/C Issuer or any Lender exercises its right of set-off, and such payment or the proceeds of such set-off or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent, such L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such set-off had not occurred, and (b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable share of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of the Lenders and the L/C Issuers under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

10.06 Successors and Assigns.

(a) Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section, (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) of this Section, or (iv) to an SPC in accordance with the provisions of subsection (i) of this Section (and any other attempted assignment or

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transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans (including for purposes of this subsection (b), participations in L/C Obligations and in Swing Line Loans) at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i) Minimum Amounts.

(A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

(B) in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided, however, that concurrent assignments to members of an Assignee Group and concurrent assignments from members of an Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and members of its Assignee Group) will be treated as a single assignment for purposes of determining whether such minimum amount has been met.

(ii) Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned, except that this clause (ii) shall not apply to rights in respect of Bid Loans or the Swing Line Lender’s rights and obligations in respect of Swing Line Loans;

(iii) Required Consents. No consent shall be required for any assignment except to the extent required by subsection (b)(i)(B) of this Section and, in addition:

(A) the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (1) an Event of Default has occurred and is continuing at the time of such assignment or (2) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten (10) Business Days after having received notice thereof;

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(B) the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required if such assignment is to a Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with respect to such Lender;

(C) the consent of each L/C Issuer (such consent not to be unreasonably withheld or delayed) shall be required for any assignment; and

(D) the consent of the Swing Line Lender (such consent not to be unreasonably withheld or delayed) shall be required for any assignment.

(iv) Assignment and Assumption. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee in the amount of $3,500; provided, however, that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

(v) No Assignment to Certain Persons. No such assignment shall be made (A) to the Borrower or any of the Borrower’s Subsidiaries or Affiliates, or (B) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B), or (C) to a natural person.

(vi) Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swing Line Loans in accordance with its Pro Rata Share. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05, and 10.04 with respect to facts and circumstances occurring prior to the effective date of such

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assignment provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section.

(c) Register. The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower (and such agency being solely for tax purposes), shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. In addition, the Administrative Agent shall maintain on the Register information regarding the designation, and revocation of designation, of any Lender as a Defaulting Lender. The Register shall be available for inspection by the Borrower and any Lender at any reasonable time and from time to time upon reasonable prior notice.

(d) Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, a Defaulting Lender or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans (including such Lender’s participations in L/C Obligations and/or Swing Line Loans) owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent, the Lenders and the L/C Issuers shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in the first proviso to Section 10.01 that directly affects such Participant. Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of, and subject to the obligations of, Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant agrees to be subject to the provisions of Sections 3.06 and 10.13 as if it were an assignee under paragraph (b) of this Section. Each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 3.06 with respect to any Participant. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender; provided such Participant agrees to be subject to Section 2.13 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation

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to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

(e) Limitations upon Participant Rights. A Participant shall not be entitled to receive any greater payment under Section 3.01 or 3.04 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 3.01(e) as though it were a Lender.

(f) Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(g) Certain Definitions. As used herein, the following terms have the following meanings:

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 10.06(b)(iii), and (v) (subject to such consents, if any, as may be required under Section 10.06(b)(iii)).

“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

(h) Electronic Execution of Assignments. An Assignment and Assumption may be signed electronically as provided in Section 10.19.

(i) Special Purpose Funding Vehicles. Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose funding vehicle identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower (an “SPC”) the option to provide all or any part of any Committed Loan that such Granting Lender would otherwise be obligated to make pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to fund any Committed Loan, and (ii) if an SPC elects not to exercise such option or otherwise fails to make all or any part of such Committed Loan, the Granting

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Lender shall be obligated to make such Committed Loan pursuant to the terms hereof or, if it fails to do so, to make such payment to the Administrative Agent as is required under Section 2.13(c)(ii). Each party hereto hereby agrees that (i) neither the grant to any SPC nor the exercise by any SPC of such option shall increase the costs or expenses or otherwise increase or change the obligations of the Borrower under this Agreement (including its obligations under Section 3.04), (ii) no SPC shall be liable for any indemnity or similar payment obligation under this Agreement for which a Lender would be liable, and (iii) the Granting Lender shall for all purposes, including the approval of any amendment, waiver or other modification of any provision of any Loan Document, remain the lender of record hereunder. The making of a Committed Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Committed Loan were made by such Granting Lender. In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior debt of any SPC, it will not institute against, or join any other Person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency, or liquidation proceeding under the laws of the United States or any State thereof. Notwithstanding anything to the contrary contained herein, any SPC may (i) with notice to, but without prior consent of the Borrower and the Administrative Agent and with the payment of a processing fee in the amount of $3,500 (which processing fee may be waived by the Administrative Agent in its sole discretion), assign all or any portion of its right to receive payment with respect to any Committed Loan to the Granting Lender and (ii) disclose on a confidential basis any non-public information relating to its funding of Committed Loans to any rating agency, commercial paper dealer or provider of any surety or Guarantee or credit or liquidity enhancement to such SPC.

(j) Resignation as L/C Issuer or Swing Line Lender after Assignment. Notwithstanding anything to the contrary contained herein, if (i) at any time Bank of America assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank of America may, (A) upon 30 days’ notice to the Borrower and the Lenders, resign as L/C Issuer, and/or (B) 30 days’ notice to the Borrower and the Lenders, resign as Swing Line Lender, and (ii) at any time any other L/C Issuer assigns all of its Commitment and Loans pursuant to subsection (b) above, such L/C Issuer may, upon 30 days’ notice to the Borrower and the Lenders, resign as L/C Issuer. In the event of any such resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided, however, that no failure by the Borrower to appoint any such successor shall affect the resignation of such L/C Issuer, as applicable, as L/C Issuer or Swing Line Lender, as the case may be. If any L/C Issuer resigns as a L/C Issuer, it shall retain all the rights, powers, privileges and duties of a L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.04(c)). If Bank of America resigns as Swing Line Lender, it shall retain all the rights of the Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.05(c). Upon the appointment of a successor L/C Issuer and/or Swing Line Lender and the written acceptance by such successor of such appointment, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring L/C Issuer to effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit.

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10.07 Confidentiality. Each of the Administrative Agent, the Lenders and the L/C Issuers agrees to maintain the confidentiality of the Information (as defined below), except that (a) Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (ii) to the extent requested by any regulatory authority or self-regulatory authority; (iii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process; (iv) to any other party to this Agreement; (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder; (vi) subject to an agreement containing provisions substantially the same as those of this Section, to any Eligible Assignee of or Participant in, or any prospective Eligible Assignee of or Participant in, any of its rights or obligations under this Agreement; (vii) with the consent of the Borrower; (viii) to the extent such Information (A) becomes publicly available other than as a result of a breach of this Section or (B) becomes available to the Administrative Agent, any Lender or any L/C Issuer on a nonconfidential basis from a source other than the Borrower; (ix) to the National Association of Insurance Commissioners or any other similar organization exercising regulatory authority over a Lender; or (x) on a confidential basis to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers or other market identifiers with respect to the credit facility provided hereunder; and (b) subject to an agreement containing provisions substantially the same as those of this Section, Information other than the Projections (as hereinafter defined) may be disclosed to any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterparty’s or prospective counterparty’s professional advisor) to any swap or credit derivative transaction relating to obligations of the Borrower. In addition, the Administrative Agent, the Lenders and the L/C Issuer may disclose the existence of this Agreement and general information about this Agreement to market data collectors, similar service providers to the lending industry, and service providers to the Administrative Agent and the Lenders in connection with the administration and management of this Agreement, the other Loan Documents, the Commitments, and the Credit Extensions. For the purposes of this Section, “Information” means all information received from the Borrower or any Subsidiary of Borrower, or any officer, director, employee, counsel, or agent of Borrower or any of its Subsidiaries relating to the Borrower or any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or any L/C Issuer on a nonconfidential basis prior to disclosure by the Borrower. As used herein, “Projections” means all financial projections prepared by the Borrower and furnished to the Lenders in connection with this Agreement. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Each of the Administrative Agent, the Lenders and the L/C Issuers acknowledges that (a) the Information may include material non-public information concerning the Borrower or a Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use of material non-public information and (c) it will handle such material non-public information in accordance with applicable Law, including Federal and state securities Laws.

10.08 Set-off. In addition to any rights and remedies of the Lenders provided by law, upon the occurrence and during the continuance of any Event of Default, each Lender and its Affiliates are authorized at any time and from time to time, without prior notice to the Borrower, any such notice being waived by the Borrower to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing by, such Lender, such L/C Issuer or any such Affiliate to or for the credit or the account of the Borrower against any and all Obligations owing to such Lender or such L/C Issuer hereunder or under any other Loan Document, now or hereafter existing, irrespective of whether or not the Administrative Agent or such Lender or such L/C Issuer shall have made demand under this Agreement

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or any other Loan Document and although such Obligations may be contingent or unmatured or denominated in a currency different from that of the applicable deposit or indebtedness; provided, that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.17 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender, each L/C Issuer and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, such L/C Issuer or their respective Affiliates may have. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender or any of its Affiliates; provided, however, that the failure to give such notice shall not affect the validity of such set-off and application.

10.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

10.10 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

10.11 Integration. This Agreement, together with the other Loan Documents, comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Administrative Agent or the Lenders in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be construed neither against nor in favor of any party, but rather in accordance with the fair meaning thereof.

10.12 Survival of Representations and Warranties. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

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10.13 Severability. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 10.13, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, the L/C Issuers or the Swing Line Lender, as applicable, then such provisions shall be deemed to be in effect only to the extent not so limited.

10.14 Replacement of Lenders. If any Lender requests compensation under Section 3.04, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if any Lender is a Defaulting Lender, or if the Borrower exercises its right to replace non-consenting Lenders pursuant to Section 10.01, or if any other circumstance exists hereunder that gives the Borrower the right to replace a Lender as a party hereto, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.06), all of its interests, rights and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that:

(a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 10.06(b);

(b) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

(c) in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter;

(d) such assignment does not conflict with applicable Laws; and

(e) In the event that such Lender is a L/C Issuer and any one or more Letters of Credit issued by such L/C Issuer under this Agreement remain outstanding on such L/C Issuer’s Maturity Date, the Borrower shall cash collateralize such Letter of Credit upon terms reasonably satisfactory to such L/C Issuer to secure the Borrower’s obligations to reimburse for drawings under such Letters of Credit or make other arrangements reasonably satisfactory to such L/C Issuer with respect to such Letters of Credit including providing other credit support.

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

10.15 Governing Law.

(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.

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(b) SUBMISSION TO JURISDICTION. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, ANY L/C ISSUER, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR ANY L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

10.16 Waiver of Right to Trial by Jury. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

96

10.17 No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby, the Borrower acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i) the credit facility provided for hereunder and any related arranging or other services in connection therewith (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document) are an arm’s-length commercial transaction between the Borrower, on the one hand, and the Administrative Agent, the Lenders and the Arrangers, on the other hand, and the Borrower is capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents (including any amendment, waiver or other modification hereof or thereof); (ii) in connection with the process leading to such transaction, the Administrative Agent, each Lender and each Arranger is and has been acting solely as a principal with respect to the financing contemplated hereby and is not the financial advisor, agent or fiduciary, for the Borrower or any of its Affiliates, stockholders, creditors or employees or any other Person; (iii) none of the Administrative Agent, any Lender or any Arranger has assumed or will assume an advisory, agency or fiduciary responsibility in favor of the Borrower with respect to any aspect of the financing contemplated hereby or the process leading thereto, including with respect to any amendment, waiver or other modification hereof or of any other Loan Document (irrespective of whether the Administrative Agent or any Lender or Arranger has advised or is currently advising the Borrower or any of its Affiliates on other matters) and none of the Administrative Agent, any Lender or any Arranger has any obligation to the Borrower or any of its Affiliates with respect to the financing contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; (iv) the Administrative Agent, the Lenders and the Arrangers and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and none of the Administrative Agent, any Lender or any Arranger has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (v) the Administrative Agent, the Lenders and the Arrangers have not provided and will not provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby (including any amendment, waiver or other modification hereof or of any other Loan Document) and the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate. The Borrower hereby waives and releases, to the fullest extent permitted by law, any claims that it may have against the Administrative Agent, the Lenders and the Arrangers with respect to any breach or alleged breach of agency or fiduciary duty.

10.18 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with the Act. The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Act.

10.19 Electronic Execution of Assignments and Certain Other Documents. The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

97

10.20 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

[Remainder of this Page is Intentionally Left Blank]

98

ONE GAS, INC.
By:	/s/ Curtis L. Dinan
	Name: Curtis L. Dinan
	Title: Senior Vice President, Chief Financial Officer and Treasurer

[Signature Page to ONE Gas Credit Agreement]

BANK OF AMERICA, N.A., as
Administrative Agent
By:	/s/ Maria A. McClain
	Name: Maria A. McClain
	Title: Vice President

[Signature Page to ONE Gas Credit Agreement]

BANK OF AMERICA, N.A., as
a Lender, L/C Issuer and Swing Line Lender
By:	/s/ Patrick Engel
	Name: Patrick Engel
	Title: Director

[Signature Page to ONE Gas Credit Agreement]

JPMORGAN CHASE BANK, N.A., as
a Lender and L/C Issuer
By:	/s/ Helen D. Davis
	Name: Helen D. Davis
	Title: Vice President

[Signature Page to ONE Gas Credit Agreement]

THE ROYAL BANK OF SCOTLAND PLC, as
a Lender and L/C Issuer
By:	/s/ Steve Ray
	Name: Steve Ray
	Title: Authorised Signatory

[Signature Page to ONE Gas Credit Agreement]

WELLS FARGO BANK, N.A.,
as a Lender
By:	/s/ Frederick Price
	Name: Frederick Price
	Title: Managing Director

[Signature Page to ONE Gas Credit Agreement]

MORGAN STANLEY BANK, N.A.,
as a Lender
By:	/s/ Kelly Chin
	Name: Kelly Chin
	Title: Authorized Signatory

[Signature Page to ONE Gas Credit Agreement]

ROYAL BANK OF CANADA,
as a Lender
By:	/s/ Frank Lambrinos
	Name: Frank Lambrinos
	Title: Authorized Signatory

[Signature Page to ONE Gas Credit Agreement]

U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By:	/s/ John Prigge
	Name: John Prigge
	Title: Vice President

[Signature Page to ONE Gas Credit Agreement]

GOLDMAN SACHS BANK USA,
as a Lender
By:	/s/ Mark Walton
	Name: Mark Walton
	Title: Authorized Signatory

[Signature Page to ONE Gas Credit Agreement]

DEUTSCHE BANK AG NEW YORK BRANCH,
as a Lender
By:	/s/ Andreas Neumeier
	Name: Andreas Neumeier
	Title: Managing Director
By:	/s/ Virginia Cosenza
	Name: Virginia Cosenza
	Title: Vice President

[Signature Page to ONE Gas Credit Agreement]

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as a Lender
By:	/s/ Paul V. Farrell
	Name: Paul V. Farrell
	Title: Director

[Signature Page to ONE Gas Credit Agreement]

SUMITOMO MITSUI BANKING CORP.,
as a Lender
By:	/s/ James Weinstein
	Name: James Weinstein
	Title: Managing Director

[Signature Page to ONE Gas Credit Agreement]

BOKF, NA DBA BANK OF OKLAHOMA,
as a Lender
By:	/s/ Jane Faulkenberry
	Name: Jane Faulkenberry
	Title: Senior Vice President

[Signature Page to ONE Gas Credit Agreement]

ARVEST BANK,
as a Lender
By:	/s/ Rick Gaut
	Name: Rick Gaut
	Title: Senior Vice President, Commercial Lender

[Signature Page to ONE Gas Credit Agreement]

UMB BANK, N.A.,
as a Lender
By:	/s/ David Hardy
	Name: David Hardy
	Title: Executive Vice President

[Signature Page to ONE Gas Credit Agreement]

EX-10.12

Exhibit 10.12

ONE GAS, INC.

OFFICER CHANGE IN CONTROL SEVERANCE PLAN

The Board has determined that it is in the best interest of ONE Gas, Inc. and its stockholders to retain the services of its key officers in the event of a threat of a Change in Control and to ensure their continued dedication and efforts in such event without undue concern for their personal financial and employment security. Accordingly, by unanimous consent, the Board approved the adoption of this Plan, effective on the Effective Date.

ARTICLE 1

DEFINITIONS

1.1 “Affiliate” means, with respect to any Person (as defined herein), any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.

1.2 “Annual Compensation” means the sum of (a) a Participant’s annual Base Salary in effective immediately prior to the Occurrence Date, plus (b) such Participant’s target Bonus (assuming attainment of corporate and individual performance factors at 100% of target) for the performance period in which the Occurrence Date occurs or, if such target has not yet been set, such Participant’s target Bonus (assuming attainment of corporate and individual performance factors at 100% of target) for the performance period last preceding the period in which the Occurrence Date Occurs.

1.3 “Base Salary” means the annual base salary of a Participant as set and approved annually by the Company before any deductions, exclusions or any deferrals or contributions under any Company employee plan or program, but excluding bonuses, incentive compensation, compensation deferred in a previous calendar year, employee benefits, expense reimbursements or any compensation other than in the form of a salary received by a Participant.

1.4 “Board” means the Board of Directors of the Company.

1.5 “Bonus” means the bonus payable to a Participant under the ONE Gas, Inc. Annual Officer Incentive Plan or, if a Participant’s 2013 Bonus is relevant, the bonus payable on account of 2013 to a Participant under the ONEOK, Inc. Annual Employee Incentive Plan or the ONEOK, Inc. Annual Officer Incentive Plan, as applicable.

1.6 “Cause” means:

(a) a Participant indictment for or conviction in a court of law of a felony or any crime or offense involving misuse or misappropriation of money or property;

(b) a Participant’s violation of any covenant, agreement or obligation not to disclose confidential information regarding the business of the Company (or a division or Subsidiary) or a Participant’s violation of any covenant, agreement or obligation not to compete with the Company (or a division or Subsidiary);

(c) any act of dishonesty by a Participant which adversely affects the business of the Company (or a division or Subsidiary), or any willful or intentional act of a Participant which adversely affects the business, or reflects unfavorably on the reputation, of the Company (or a division or Subsidiary);

(d) a Participant’s material violation of any written policy of the Company (or a division or Subsidiary); or

(e) a Participant’s failure or refusal to perform the specific directives of the Company’s Board, or its officers, which directives are consistent with the scope and nature of the Participant’s duties and responsibilities, to be determined in the Board’s sole discretion.

Nothing contained in the foregoing provisions of this paragraph shall be deemed to interfere in any way with the right of the Company (or a division or Subsidiary), which is hereby acknowledged, to terminate a Participant’s employment at any time with or without Cause.

1.7 “Change in Control” means the occurrence of any of the following after the Effective Date:

(a) An acquisition (other than directly from the Company) of any voting securities of the Company (the “Voting Securities”) by any “Person” (as the term person is used for purposes of Section 13(d) or 14(d) of the Exchange Act), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities; provided, however, in determining whether a Change in Control has occurred pursuant to this Section 1.6, Shares or Voting Securities which are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not constitute an acquisition which would cause a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any corporation or other Person of which a majority of its voting power or its voting equity securities or equity interest is owned or controlled, directly or indirectly, by the Company (for purposes of this definition, a “Related Entity”), (ii) the Company or any Related Entity, or (iii) any Person in connection with a “Non-Control Transaction” (as hereinafter defined);

(b) The individuals who are members of the Board (the “Incumbent Board”) on the Effective Date, cease for any reason to constitute at least a majority of the members of the Board within any consecutive twelve (12) month period, or, following a Merger which results in a Parent Company, the board of directors of the ultimate Parent Company; provided, however, that if the election, or nomination for election by the Company’s common stockholders, of any new director was approved by a vote of at least two-thirds of the Incumbent Board (as hereinafter defined), such new director shall, for purposes of this Agreement, be considered as a member of the Incumbent Board; provided further, however, that no individual shall be considered a member of the

2

Incumbent Board if such individual initially assumed office as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

(c) The consummation of:

(i) A merger, consolidation or reorganization with or into the Company or in which securities of the Company are issued (a “Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger where:

1. the stockholders of the Company, immediately before such Merger, own directly or indirectly immediately following such Merger at least fifty percent (50%) of the combined voting power of the outstanding voting securities of (x) the corporation resulting from such Merger (the “Successor”) if fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Successor is not Beneficially Owned, directly or indirectly by another Person (a “Parent Company”), or (y) if there is one or more Parent Companies, the ultimate Parent Company;

2. the individuals who were members of the Incumbent Board immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (x) the Successor, if there is no Parent Company, or (y) if there is one or more Parent Companies, the ultimate Parent Company; and

3. no Person other than (1) the Company, (2) any Related Entity, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to such Merger was maintained by the Company or any Related Entity, or (4) any Person who, immediately prior to such Merger had Beneficial Ownership of twenty percent (20%) or more of the then outstanding Voting Securities or Shares, has Beneficial Ownership of twenty percent (20%) or more of the combined voting power of the outstanding voting securities or common stock of (x) the Successor if there is no Parent Company, or (y) if there is one or more Parent Companies, the ultimate Parent Company.

(ii) A complete liquidation or dissolution of the Company; or

(iii) The sale or other disposition of all or substantially all of the assets of the Company to any Person (other than a transfer to a Related

3

Entity or under conditions that would constitute a Non-Control Transaction with the disposition of assets being regarded as a Merger for this purpose or the distribution to the Company’s stockholders of the stock of a Related Entity or any other assets).

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities if:

1. such acquisition occurs as a result of the acquisition of Shares or Voting Securities by the Company which, by reducing the number of Shares or Voting Securities then outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this subparagraph) as a result of the acquisition of Shares or Voting Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Shares or Voting Securities which increases the percentage of the then outstanding Shares or Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur, or

2. within five business days after a Change in Control would have occurred (but for the operation of this subparagraph), or if the Subject Person acquired Beneficial Ownership of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities inadvertently, then after the Subject Person discovers or is notified by the Company that such acquisition would have triggered a Change in Control (but for the operation of this subparagraph), the Subject Person notifies the Board of Directors that it did so inadvertently, and within two business days after such notification, the Subject Person divests itself of a sufficient number of Shares or Voting Securities so that the Subject Person is the Beneficial Owner of less than twenty percent (20%) of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities.

Notwithstanding anything in this Plan to the contrary, the Separation shall not constitute a Change in Control.

1.8 “Code” means the Internal Revenue Code of 1986, as amended.

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1.9 “Company” means ONE Gas, Inc., an Oklahoma corporation and any successor, whether the liability of such successor under the Plan is established by contract or occurs by operation of law.

1.10 “Effective Date” means the effective date of the Separation.

1.11 “Employment Termination Date” means the date on which the employment relationship between a Participant and the Company and its Subsidiaries is terminated due to an Involuntary Termination.

1.12 “Exchange Act” means the Securities Exchange Act of 1934, as amended.

1.13 “Good Reason Event” means the occurrence of one or more of the following events or conditions after the occurrence of a Change in Control:

(a) A Participant’s demotion or material reduction of a Participant’s significant authority or responsibility with respect to the Participant’s employment with the Company from that in effect on the Occurrence Date;

(b) A material reduction in Base Salary of a Participant from that in effect immediately prior to the Occurrence Date;

(c) A material reduction in the amount of the short-term and/or long-term incentive target awards from those applicable to a Participant immediately prior to the Occurrence Date;

(d) The relocation to a new principal place of a Participant’s employment by the Company, which is more than thirty-five (35) miles further from the Participant’s principal place of residence than the Participant’s principal place of employment was prior to such change; or

(e) The failure of a successor company to explicitly assume the Plan;

provided, however, a Participant may consent in writing to any such demotion, loss, reduction, relocation or successor’s failure to assume. The effect of any written consent of a Participant shall be strictly limited to the terms specified in such written consent. In order to invoke an Involuntary Termination for a Good Reason Event, a Participant shall give notice of any termination of the Participant’s employment for the Good Reason Event due to any of the events described above by delivery of written notice thereof to the Company within one hundred twenty (120) days after the first occurrence of the event giving rise to such Good Reason Event. The Company shall have thirty (30) days following receipt of such written notice (the “Cure Period”) during which it may remedy the condition. In the event that the Company fails to remedy the condition constituting a Good Reason Event during the Cure Period, a Participant must terminate employment, if at all, within ninety (90) days following the end of the Cure Period in order for such termination of employment to constitute a termination for a Good Reason Event by reason of that event or condition.

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1.14 “Involuntary Termination” means the termination of a Participant’s employment relationship with the Company and each Subsidiary (a) by the Company or a Subsidiary for any reason other than Cause, or (b) by the Participant on account of a Good Reason Event. A Participant shall not be deemed to have incurred an Involuntary Termination by reason of the transfer of the Participant’s employment between the Company and any of its Subsidiaries, or among Subsidiaries. The Plan Administrator shall determine, in its sole discretion, whether a Participant’s termination of employment from the Company or any Subsidiary constitutes an Involuntary Termination. To the extent that Code section 409A applies to the Plan benefit, a Participant will not be considered to have terminated his or her employment relationship unless the termination of employment qualifies as a “separation from service”, as defined under Code section 409A and the regulations thereunder.

1.15 “Occurrence Date” means the date on which a Change in Control occurs.

1.16 “ONEOK Group” means ONEOK, Inc. and any of its direct or indirect subsidiaries.

1.17 “Participant” means an employee of the Company or a Subsidiary who is identified by the Board as a participant in the Plan pursuant to Section 2 of the Plan.

1.18 “Plan” means the ONE Gas, Inc. Officer Change in Control Severance Plan, as set forth herein and as amended from time to time.

1.19 “Plan Administrator” means the Board; provided, however, that the Board may designate any individual or a committee to administer the Plan in accordance with the provisions of Article 7.

1.20 “Separation” means the separation of the ONEOK, Inc. local natural gas distribution business into an independent, publicly traded entity to be known as ONE Gas, Inc.

1.21 “Severance Multiple” means the number used to determine a Participant’s cash severance under Section 3.1(a) of the Plan, which is subject to change by the Board in accordance with Section 2.2; provided, however, that in no event shall such number exceed three (3).

1.22 “Shares” means the common stock, par value $.01 per share, of the Company and any other securities into which such shares are changed or for which such shares are exchanged.

1.23 “Subsidiary” means (a) a corporation, partnership, limited liability company or other entity in which the Company owns directly or indirectly more than 50% of the outstanding shares of voting stock or other voting interest, and (b) any other entity in which the Company directly or indirectly beneficially owns a controlling interest.

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ARTICLE 2

ELIGIBILITY

2.1 Participants and Severance Multiples. Schedule A sets forth the Participants in the Plan as of the Effective Date. Schedule A also sets forth Participants’ applicable Severance Multiples as of the Effective Date for purpose of Section 3.1(a) of the Plan.

2.2 Review by Board. The Board, in its sole discretion, from time to time, shall review the Participants in the Plan and shall determine which, if any, Participants should be added or removed as Participants. The Board, in its sole discretion from time to time, shall also review and may change, in its sole discretion, the Severance Multiples applicable to each such Participant in the Plan.

ARTICLE 3

SEVERANCE BENEFITS

3.1 Severance Benefits. Upon an Involuntary Termination within two (2) years after the Occurrence Date, a Participant shall be entitled to the following benefits:

(a) A single lump sum cash payment by the Company equal to the product the Participant’s Severance Multiple and the Participant’s Annual Compensation; and

(b) To the extent that the Participant elects continuation coverage pursuant to Section 4980B of the Code (i.e., COBRA continuation coverage), the Company shall reimburse the COBRA premiums paid by the Participant until the earlier of (i) the date that is eighteen (18) months following the Participant’s Employment Termination Date and (ii) the date that the Participant becomes eligible for medical, dental and health insurance benefits from a subsequent employer. The continued coverage under this Section 3.1(b) shall be provided in a manner that is intended to satisfy an exception to Section 409A of the Code, and therefore not treated as an arrangement that is subject to taxation under Section 409A. Notwithstanding the foregoing, if at any time the Company determines, in its sole discretion, that its reimbursement of the Participant’s COBRA premiums could result in the Company or participants in the Company’s health and welfare plans incurring additional costs, penalties or taxes under applicable law (including, without limitation, Section 2716 of the Public Health Service Act and Code section 105(h)) then in lieu of reimbursing the Participant for the COBRA premiums, the Company may provide an alternative, but substantially equivalent, benefit designed to avoid the additional costs, penalties or taxes.

3.2 Termination under Other Circumstances. No benefits shall be payable under the Plan due to termination of employment on account of (i) death, (ii) disability, (iii) resignation not for a Good Reason Event, (iv) termination by the Company and its Subsidiaries for Cause, or (v) any other termination of employment that is not an Involuntary Termination that occurs prior to the second anniversary of the Occurrence Date.

3.3 The Separation. No benefits shall be payable under the Plan as a result of the Separation, and no Participant shall be treated as having terminated employment with the Company or any of its Subsidiaries for any purpose under the Plan as a result of the Separation.

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3.4 Effect of Severance Payments and Benefits. Any benefits provided or payments made under the Plan shall not be taken into account as compensation for purposes of determining a Participant’s contributions or benefits under any other employee benefit plan of the Company or Subsidiary.

ARTICLE 4

TIME OF SEVERANCE PAYMENT

Payment of the severance payment described in Section 3.1(a) of the Plan shall be conditioned on a Participant’s execution, delivery and non-revocation of a valid and enforceable general release of claims in the form attached hereto as Exhibit A (the “Release”) during sixty (60) day period following the Termination Date (the “Release Period”). The severance payment described in Section 3.1(a) shall be paid in a lump sum on the Company’s next regular payroll date occurring following the date the Release becomes effective and irrevocable; provided, however, that if Section 409A of the Code applies to the severance payment and the Release Period begins in one calendar year and ends in the subsequent calendar year, payment of the severance payment shall occur on the next regular payroll date occurring following the later of (i) January 1 of such subsequent calendar year and (ii) the date the Release becomes effective and irrevocable.

ARTICLE 5

LIMITATION ON PAYMENT OF BENEFITS

5.1 The Company shall make the payment and provide the payments and benefits under Article 3; provided, however, that if all or any portion of the payments and benefits provided under Article 3, either alone or together with other payments and benefits which the Participant receives or is then entitled to receive from the Company, would constitute a “parachute payment” within the meaning of Section 280G of the Code, the Company shall reduce such payments and benefits provided to the Participant under Article 3 of the Plan to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code, but only if, by reason of such reduction, the net after-tax benefit to the Participant shall exceed the net after-tax benefit if such reduction were not made. In the event that any payment or benefit intended to be provided under the Plan or otherwise is required to be reduced pursuant to this Section 5.1, the Company will effect such reduction by first reducing the benefits described in Section 3.1(a), then, to the extent necessary, by reducing the benefits described in Section 3.1(b).

“Net after-tax benefit” for these purposes shall mean the sum of (i) the total amount payable to the Participant under Article 3, plus (ii) all other payments and benefits which the Participant receives or is then entitled to receive from the Company that would constitute a “parachute payments” within the meaning of Section 280G of the Code, less (iii) the amount of federal income taxes payable with respect to the foregoing calculated at the maximum marginal income tax rate for each year in which the foregoing shall be paid to the Participant (based upon the rate in effect for such year as set forth in the Code at the time of the payment under Section 3), less (iv) the amount of excise taxes imposed with respect to the payments and benefits

8

described in (i) and (ii) above by Section 4999 of the Code. The amount of any reduction made under this Section 5.1 in the payment to which the Participant is entitled under Article 3 of this Agreement is hereinafter referred to as the “Relinquished Amount.”

5.2 If the Participant’s payment under Article 3 is reduced under Section 5.1 and, notwithstanding such reduction, the Participant subsequently pays or becomes obligated to pay any excise tax under Section 4999 of the Code on any portion of any payment or benefit the Participant receives (whether pursuant to this Agreement or otherwise) in connection with the event giving rise to the Participant’s right to receive payments and benefits under Article 3, the Company shall pay to the Participant an amount equal to the Relinquished Amount and an amount (“Special Reimbursement”) which, after payment by the Participant of any federal, state and local taxes, including any further excise tax under Section 4999 of the Code resulting from all payments and benefits received (whether pursuant to this Agreement or otherwise, and including the Relinquished Amount and this Special Reimbursement), equals the total excise tax paid or payable.

5.3 The determination of whether the payments shall be reduced as provided in this Article 5 and the amount of such reduction shall be made at the Company’s expense by an accounting firm retained by the Company at the time the calculation is to be performed, or one selected by the Company from among the five largest accounting firms in the United States (the “Accounting Firm”). The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation to the Company and the Participant within ten (10) days of the Employment Termination Date. If the Accounting Firm determines that no excise tax is payable by the Participant with respect to the payments, it shall furnish the Participant with an opinion reasonably acceptable to the Participant that no excise tax will be imposed with respect to any such payments and, absent manifest error, such Determination shall be binding, final and conclusive upon the Company and the Participant. If the Accounting Firm determines that an excise tax would be payable, the Participant shall have the right to accept the Determination of the Accounting Firm as to the extent of the reduction, if any, pursuant to this Article 5, or to have such Determination reviewed by an accounting firm selected by the Participant, at the expense of the Company, in which case the determination of such second accounting firm shall be binding, final and conclusive upon the Company and Participant.

ARTICLE 6

UNFUNDED ARRANGEMENT

The Plan is unfunded, and all benefits payable hereunder will be paid, as needed, from the general assets of the Company. The Plan is only a general corporate commitment and each Participant must rely upon the general credit of the Company for the fulfillment of its obligations hereunder. Nothing contained in the Plan shall constitute a guarantee by the Company that the assets of the Company will be sufficient to pay any benefits under the Plan or would place any Participant in a secured position ahead of general creditors of the Company. The Participants are unsecured creditors of the Company with respect to their Plan benefits, and the Plan constitutes a promise by the Company to make benefit payments in the future to eligible Participants. No specific assets of the Company have been or shall be set aside, or shall in any way be transferred

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to a trust or shall be pledged in any way for the performance of the Company’s obligations under the Plan which would remove such assets from being subject to the general creditors of the Company.

ARTICLE 7

ADMINISTRATION OF THE PLAN

7.1 The Plan Administrator shall have the full power and authority to administer the Plan, carry out its terms and conditions and effectuate its purposes.

7.2 The Plan Administrator shall serve without compensation for its services as such. However, all reasonable expenses of the Plan Administrator shall be paid or reimbursed by the Company upon proper documentation. The Plan Administrator shall be indemnified by the Company against personal liability for actions taken in good faith in the discharge of duties as the Plan Administrator.

7.3 The Plan Administrator shall keep all individual and group records relating to Participants and former Participants and all other records necessary for the proper operation of the Plan. Such records shall be made available to the Company and to each Participant for examination during business hours except that a Participant shall examine only such records as pertain exclusively to the examining Participant and to the Plan. The Plan Administrator shall prepare and shall file as required by law or regulation all reports, forms, documents and other items required by applicable law and all regulations thereunder (except that the Company, as payor of the Plan benefits, shall prepare and distribute to the proper recipients all forms relating to withholding of income or wage taxes, Social Security taxes, and other amounts which may be similarly reportable).

ARTICLE 8

AMENDMENT OR TERMINATION

The Board reserves the right to amend or terminate the Plan at any time and in any manner without the consent of any affected individual, which right includes, without limitation, the right to change the individuals who are eligible to participate in the Plan from time to time. Notwithstanding the foregoing, (i) for a period of two (2) years following a Change in Control, the Plan may not be terminated or amended in any manner adverse to any eligible Participant without the written consent of each affected Participant and (ii) any amendment to or termination of the Plan will not adversely affect the benefits otherwise payable to a Participant whose Employment Termination Date occurred prior to the date of such amendment or termination.

ARTICLE 9

CLAIMS PROCEDURES

9.1 Claim for Benefits. When a benefit is due under the Plan, a Claimant must submit a claim for benefits to the office designated by the Plan Administrator to receive claims

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within 180 days of the date of a Participant’s Involuntary Termination. For purposes of this Article, “Claimant” means a Participant or an authorized representative of a Participant who makes a claim for benefits under the Plan.

9.2 Deadline for Notifications of Claim Determinations. If a Claimant’s claim for benefits under the Plan is denied in whole or in part, the Plan Administrator will provide to the Claimant a written notice of the claim decision within 90 days of receipt of the claim. This 90-day period may be extended one time by the Plan Administrator for up to 90 days, provided that the Plan Administrator notifies the Claimant, prior to the expiration of such 90-day period, of the circumstances requiring the extension of time and the date by which the Plan Administrator expects to render a decision. Claims not acted upon within the time prescribed herein shall be deemed denied for purposes of proceeding to the review stage.

9.3 Contents of Notices of Claims Denials. When a claim is denied (an adverse determination) in full or in part, the Plan Administrator will provide the Claimant a written or electronic notification of the denial within the time frame specified in Section 9.2. This notice will:

(a) explain the specific reasons for the adverse determination;

(b) reference the specific Plan provisions on which the adverse determination is based;

(c) provide a description of any additional material or information necessary for the Claimant to complete the claim and an explanation of why such material or information is necessary; and

(d) provide a description of the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the Claimant’s right to bring a civil action following an adverse claims determination on review.

9.4 Appeals of Denied Claims. The Claimant will have 60 days after receiving the notice that the Claimant’s claim is denied to appeal the adverse determination in writing to the Plan Administrator. The Claimant may submit written comments, documents, records, and other information relevant to the claim, and such information will be taken into account during the review, without regard to whether it was submitted or considered in the initial claim determination. In addition, the Claimant will be provided, upon request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to the claim. If no appeal of the adverse determination is made in writing to the Plan Administrator within 60 days after the Claimant’s receipt of the notice of denial, the denial of the claim is final.

9.5 Deadlines for Notifications of Appeals Determinations. The Administrator will notify the Claimant of its determination on review of an adverse claim determination within a reasonable period of time, but not later than 60 days from receipt of a request for review of the adverse determination. This 60-day period may be extended one time by the Plan Administrator for up to 60 days, provided that the Plan Administrator notifies the Claimant, prior to the expiration of such 60-day period, of the circumstances requiring the extension of time and the date by which the Plan Administrator expects to render a decision.

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9.6 Contents of Notices of Final Claims Determinations. Notice of the Plan’s claims decision will be given in writing or electronically. If the Claimant’s claim is denied in whole or in part the notification will include:

(a) the specific reasons for the denial;

(b) reference to the specific Plan provisions on which the decision was based;

(c) a statement of the Claimant’s right to receive, upon request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to the claim; and

(d) a statement of the Claimant’s right to bring a civil action in court.

9.7 Other Remedies. A Claimant’s compliance with the foregoing procedures is a mandatory prerequisite to a Claimant’s right to pursue any other remedy with respect to any claim relating to this Plan.

ARTICLE 10

MISCELLANEOUS

10.1 Tax Withholding. The Company will calculate the deductions from the amount of the benefit otherwise payable under the Plan for any taxes required to be withheld by federal, state or local government and shall cause them to be withheld.

10.2 Plan Not an Employment Contract. The adoption and maintenance of the Plan is not a contract between the Company and its employees, which gives any employee the right to be retained in its employment. Likewise, it is not intended to interfere with the rights of the Company to discharge any employee at any time or to interfere with the employee’s right to terminate his or her employment at any time.

10.3 Alienation Prohibited. No benefits hereunder shall be subject to alienation or assignment by a Participant, to attachment by, interference with, or control of any creditor of a Participant, or to being taken or reached by any legal or equitable process in satisfaction of any debt or liability of a Participant prior to its actual receipt by a Participant. Any attempted conveyance, transfer, assignment, mortgage, pledge, or encumbrance of the benefits hereunder prior to payment thereof shall be void.

10.4 Gender and Number. If the context requires it, words of one gender when used in the Plan shall include the other genders, and words used in the singular or plural shall include the other.

10.5 Severability. If any provision of the Plan is determined to be invalid or unenforceable, that determination shall not affect the validity or enforceability of any other provision.

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10.6 Successors. The Plan shall be binding upon and inure to the benefit of the Company and any of its successors or assigns. The Company shall require any successor to or assignee of (whether direct or indirect, by purchase, merger, consolidation or otherwise) all or substantially all of the assets or businesses of the Company (i) to assume unconditionally and expressly the Plan and (ii) to agree to perform or to cause to be performed all of the obligations under the Plan in the same manner and to the same extent as would have been required of the Company had no assignment or succession occurred.

10.7 Assignment; Binding Effect. The Plan shall be binding upon any Successor. The Company shall not assign any of its obligations under the Plan unless (a) such assignment is to a Successor, and (b) the requirements of Section 10.6 are fulfilled.

10.8 Code Section 409A. All amounts payable under this Plan are intended to comply with the “short term deferral” exception from Code Section 409A specified in Treas. Reg. § 1.409A-1(b)(4) (or any successor provision) or the “separation pay plan” exception specified in Treas. Reg. § 1.409A-1(b)(9) (or any successor provision), and shall be interpreted in a manner consistent with those exceptions. Notwithstanding the foregoing, to the extent that any amounts payable in accordance with the Plan are subject to Code Section 409A, the Plan shall be interpreted and administered in such a way as to comply with the applicable provisions of Code Section 409A to the maximum extent possible. 

10.9 No Duplication of Benefits. Participants in the Plan shall not be entitled to (i) participate in the ONE Gas, Inc. Severance Pay Plan, the ONEOK, Inc. Severance Pay Plan or the ONEOK, Inc. Officer Change in Control Severance Plan at the same time or (ii) receive benefits under both this Plan and the ONEOK, Inc. Severance Pay Plan or the ONEOK, Inc. Officer Change in Control Severance Plan with respect to the same service; provided that, in the event that any employee ceases to be a Participant in the Plan at any time as determined by the Board in its sole discretion, such employee shall automatically become a Participant in the ONE Gas, Inc. Severance Pay Plan.

10.10 Entire Agreement. No employee shall be a Participant in the Plan until any prior agreements or policies relating to severance between such employee and the Company have been terminated. The Plan shall be the entire agreement between the Company and Participants relating to the matters contained herein.

10.11 Arbitration.

(a) Any dispute, controversy or claim arising out of or relating to this Agreement, or the breach, termination or validity thereof, shall be settled by binding arbitration in accordance with the CPR Non-Administered Arbitration Rules in effect on the date of the Plan, by a sole arbitrator.

(b) The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. § 1-16, and judgment upon the award rendered by the Arbitrator may be entered by any court having jurisdiction thereof.

(c) The place of arbitration shall be Tulsa, Oklahoma.

(d) The statute of limitations of the State of Oklahoma applicable to the commencement of a lawsuit shall apply to the commencement of arbitration hereunder.

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10.12 Governing Law. The provisions of the Plan shall be governed by the laws of the State of Oklahoma and, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive law of another jurisdiction. Participants under the Plan are deemed to submit to the exclusive jurisdiction and venue of the federal or state courts of Oklahoma to resolve any and all issues that may arise out of or relate to the Plan.

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EX-10.13

Exhibit 10.13

ONE GAS, INC.

EQUITY COMPENSATION PLAN

1. General

1.1 Establishment. By unanimous consent, the Board of Directors of the Company approved the adoption of this Plan, effective as of the Effective Date, subject to approval by ONEOK, the Company’s sole shareholder, prior to the Effective Date.

1.2 Purposes. The purposes of this Plan are (a) to provide competitive incentives that will enable the Company to attract, retain, motivate, and reward eligible Employees and Non-Employee Directors of the Company and its Subsidiaries, and (b) to give eligible Employees and Non-Employee Directors an interest parallel to the interests of the Company’s shareholders generally.

1.3 Duration of Plan.

(a) The Plan shall continue in effect for a term of ten years after the date on which the Board of Directors approved the adoption of the Plan, unless sooner terminated by the Board of Directors.

(b) The termination of the Plan will not affect the validity of any Stock Incentive outstanding on the termination date or the Committee’s ability to exercise the powers granted to it hereunder with respect to such Stock Incentives.

(c) In no event shall a Stock Incentive be granted under the Plan more than ten (10) years from the date on which the Board of Directors approved the adoption of this Plan.

1.4 Section 409A. The Company intends that Stock Incentives and Awards granted pursuant to the Plan be exempt from or comply with Section 409A and Treasury Regulations thereunder and the Plan shall be so construed.

2. Definitions

Unless otherwise required by the context, the following terms, when and wherever used in this Plan, shall have the meanings set forth in this Section 2.

2.1 “Award” means an award of a Stock Incentive that is made under the Plan.

2.2 “Award Agreement” means a written instrument that is an agreement that evidences an Award and terms and provisions of a Stock Incentive granted under the Plan, pursuant to Section 17.4 or other provisions of the Plan.

2.3 “Beneficiary” means a person or entity (including a trust or estate), designated in writing by a Participant on such forms and in accordance with such terms and conditions as the Committee may prescribe, to whom the Participant’s rights under the Plan shall pass in the event of the death of the Participant.

2.4 “Board” or “Board of Directors” means the Board of Directors of the Company, as constituted from time to time.

2.5 A “Change in Control” shall mean the occurrence of any of the following:

(a) An acquisition (other than directly from the Company) of any voting securities of the Company (the “Voting Securities”) by any “Person” (as the term person is used for purposes of Section 13(d) or 14(d) of the Exchange Act), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities; provided, however, in determining whether a Change in Control has occurred pursuant to this Section 2(c), Shares or Voting Securities which are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not constitute an acquisition which would cause a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any company or other Person of which a majority of its voting power or its voting equity securities or equity interest is owned or controlled, directly or indirectly, by the Company (for purposes of this definition, a “Related Entity”), (ii) the Company or any Related Entity, or (iii) any Person in connection with a “Non-Control Transaction” (as hereinafter defined);

(b) The individuals who, as of the Effective Date, are members of the Board of Directors (the “Incumbent Board”), cease for any reason to constitute at least a majority of the members of the Board of Directors; or, following a Merger which results in a Parent Company, the board of directors of the ultimate Parent Company; provided, however, that if the election, or nomination for election by the Company’s common stockholders, of any new director was approved by a vote of at least two-thirds of the Incumbent Board, such new director shall, for purposes of this Plan, be considered as a member of the Incumbent Board; provided further, however, that no individual shall be considered a member of the Incumbent Board if such individual initially assumed office as a result of either an actual or threatened “Election Contest” (as described in Rule 14a-11 promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board of Directors (a “Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest; or

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(c) The consummation of:

(1) A merger, consolidation or reorganization with or into the Company or in which securities of the Company are issued (a “Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger where:

(A) the stockholders of the Company, immediately before such Merger, own directly or indirectly immediately following such Merger at least fifty percent (50%) of the combined voting power of the outstanding voting securities of (x) the company resulting from such Merger (the “Surviving Company”) if fifty percent (50%) or more of the combined voting power of the then outstanding voting securities of the Surviving Company is not Beneficially Owned, directly or indirectly by another Person (a “Parent Company”), or (y) if there is one or more Parent Companies, the ultimate Parent Company;

(B) the individuals who were members of the Incumbent Board immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (i) the Surviving Company, if there is no Parent Company, or (ii) if there is one or more Parent Companies, the ultimate Parent Company; and

(C) no Person other than (1) the Company, (2) any Related Entity, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to such Merger was maintained by the Company or any Related Entity, or (4) any Person who, immediately prior to such Merger had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Voting Securities or Shares, has Beneficial Ownership of thirty percent (30%) or more of the combined voting power of the outstanding voting securities or common stock of (i) the Surviving Company if there is no Parent Company, or (ii) if there is one or more Parent Companies, the ultimate Parent Company.

(2) A complete liquidation or dissolution of the Company; or

(3) The sale or other disposition of all or substantially all of the assets of the Company to any Person (other than a transfer to a Related Entity or under conditions that would constitute a Non-Control Transaction with the disposition of assets being regarded as a Merger for this purpose or the distribution to the Company’s stockholders of the stock of a Related Entity or any other assets).

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities if: (1) such acquisition occurs as a result of the acquisition of Shares or Voting Securities by the Company which, by reducing the number of Shares or Voting Securities then outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this subparagraph) as a result of the acquisition of Shares or Voting Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Shares or Voting Securities which increases the percentage of the then outstanding Shares or Voting Securities Beneficially

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Owned by the Subject Person, then a Change in Control shall occur, or (2) (A) within five business days after a Change in Control would have occurred (but for the operation of this subparagraph), or if the Subject Person acquired Beneficial Ownership of twenty percent (20%) or more of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities inadvertently, then after the Subject Person discovers or is notified by the Company that such acquisition would have triggered a Change in Control (but for the operation of this subparagraph), the Subject Person notifies the Board of Directors that it did so inadvertently, and (B) within two business days after such notification, the Subject Person divests itself of a sufficient number of Shares or Voting Securities so that the Subject Person is the Beneficial Owner of less than twenty percent (20%) of the then outstanding Shares or the combined voting power of the Company’s then outstanding Voting Securities.

Notwithstanding anything in this Plan to the contrary, if an eligible Employee’s employment is terminated by the Company without Just Cause prior to the date of a Change in Control but the eligible Employee reasonably demonstrates that the termination (1) was at the request of a third party who has indicated an intention or taken steps reasonably calculated to effect a Change in Control or (2) otherwise arose in connection with, or in anticipation of, a Change in Control which has been threatened or proposed, such termination shall be deemed to have occurred after a Change in Control for purposes of this Plan, provided a Change in Control shall actually have occurred.

Notwithstanding anything in this Plan to the contrary, the Separation shall not constitute a Change in Control.

Notwithstanding the foregoing, the Committee may from time to time provide in the written terms and provisions of a Stock Incentive instrument, Award or Award Agreement that a different definition of the terms Change in Ownership or Control shall apply and determine the time of settlement, distribution and payment of an Award for purposes of Section 409A and any deferral of compensation subject to the requirements of Section 409A under the Plan.

2.6 “Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time. References to a particular section of the Code shall include references to any related Treasury Regulations and to successor provisions.

2.7 “Committee” means the Committee appointed by the Board of Directors to administer the Plan pursuant to the provisions of section 14.1 below.

2.8 “Common Stock” means common stock, $0.01 par value, of the Company.

2.9 “Company” means ONE Gas, Inc., an Oklahoma corporation.

2.10 “Deferred Compensation Program” means a program established by the Committee providing for the deferral of compensation with respect to Awards pursuant to sections 10 and 11.

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2.11 “Director Fees” means all compensation and fees paid to a Non-Employee Director by the Company for his or her services as a member of the Board of Directors.

2.12 “Director Stock Award” means an award of Common Stock granted to a Non-Employee Director.

2.13 “Distribution” means the distribution of all of the outstanding shares of Company Common Stock to the holders of shares of ONEOK common stock in connection with the Separation.

2.14 “Distribution Date” means the effective date of the Distribution.

2.15 “Effective Date” means the effective date of the Distribution.

2.16 “Employee” means an employee of the Company or its Subsidiaries, including an officer or director who is such an employee.

2.17 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

2.18 “Fair Market Value” means (A) during such time as the Common Stock is listed upon the New York Stock Exchange or any other established stock exchange, the closing price of the Common Stock as reported by such stock exchange on the day for which such value is to be determined (or, if no sale of the Common Stock shall have been made on any such stock exchange that day, the closing price on the most recent prior day for which a sale was so reported) or (B) during any such time as the Common Stock is not listed upon an established stock exchange, the mean between high bid and low asked prices of the Common Stock in the over-the-counter market on the day for which such value is to be determined, as reported in The Wall Street Journal or another reputable source designated by the Committee, or (C) during any such time as the Common Stock cannot be valued pursuant to (A) or (B) above, the fair market value shall be as determined by the Committee considering all relevant information including, by example and not by limitation, the services of an independent appraiser. In the case of an Incentive Stock Option, if the foregoing method of determining Fair Market Value should be inconsistent with section 422 of the Code, or in the case of any other type of Stock Incentive the foregoing method is determined by the Committee, in its discretion, to not be applicable, a “Fair Market Value” shall be determined by the Committee in a manner consistent with such section of the Code, or in such other manner as the Committee, in its discretion, determines to be appropriate, and shall mean the value as so determined.

Notwithstanding the foregoing, the Committee may, in its discretion, determine the Fair Market Value of a share of Stock on the basis of the opening, closing, or average of the high and low sale prices of a share of Stock on such date or the preceding trading day, the actual sale price of a share of Stock received by a Participant, any other reasonable basis using actual transactions in the Stock as reported on a national or regional securities exchange or market system and consistently applied, or on any other basis consistent with the requirements of Section 409A. The Committee may vary its method of determination of the Fair Market Value as provided in this Section for different purposes under the Plan to the extent consistent with the requirements of Section 409A.

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2.19 “General Counsel” means the General Counsel of the Company serving from time to time.

2.20 “Incentive Stock Option” means an option, including an Option as the context may require, intended to qualify for the tax treatment applicable to incentive stock options under section 422 of the Code.

2.21 “Just Cause” shall mean the Employee’s conviction in a court of law of a felony, or any crime or offense in a court of law of a felony, or any crime or offense involving misuse or misappropriation of money or property, the Employee’s violation of any covenant, agreement or obligation not to disclose confidential information regarding the business of the Company (or a Subsidiary); any violation by the Employee of any covenant not to compete with the Company (or a Subsidiary); any act of dishonesty by the Employee which adversely affects the business of the Company (or a Subsidiary); any willful or intentional act of the Employee which adversely affects the business of, or reflects unfavorably on the reputation of the Company (or a Subsidiary); the Employee’s use of alcohol or drugs which interferes with the Employee’s performance of duties as an employee of the Company (or a Subsidiary); or the Employee’s failure or refusal to perform the specific directives of the Company’s Board of Directors, or its officers which directives are consistent with the scope and nature of the Employee’s duties and responsibilities with the existence and occurrence of all of such causes to be determined by the Company in its sole discretion; provided, that nothing contained in the foregoing provisions of this paragraph shall be deemed to interfere in any way with the right of the Company (or a Subsidiary), which is hereby acknowledged, to terminate the Employee’s employment at any time without cause.

2.22 “Non-Employee Director” means a member of the Board of Directors of the Company (or a Subsidiary) who is not an employee of the Company (or a Subsidiary), and who qualifies as a “Non-Employee Director” under the definition of that term in SEC Rule 16b-3.

2.23 “Non-Qualified Performance Stock Incentive” means a Performance Stock Incentive granted under the Plan that is not intended to qualify as qualified performance based compensation under Section 162(m) of the Code, as described in Section 17.9.

2.24 “Non-Statutory Stock Option” means an option, including an Option as the context may require, which is not intended to qualify for the tax treatment applicable to incentive stock options under section 422 of the Code.

2.25 “ONEOK Stock Programs” means the ONEOK, Inc. Equity Compensation Plan and the ONEOK, Inc. Long-Term Incentive Plan.

2.26 “Option” means an option granted under this Plan to purchase shares of Common Stock. Options may be Incentive Stock Options or Non-Statutory Stock Options.

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2.27 “Former ONE Gas Employee” means any individual (or any beneficiary, dependent, or alternate payee of such individual, as the context requires) (i) whose employment with the Company or any of its Subsidiaries was terminated before the effective date of the Separation; or (ii) whose employment with any member of the ONEOK Group was terminated prior to January 1, 2014, if such individual was allocated in connection with the Separation to the Company or any of its Subsidiaries as of January 1, 2014 by ONEOK, Inc., in its sole discretion.

2.28 “ONEOK” means ONEOK, Inc., an Oklahoma corporation.

2.29 “ONEOK Group” means ONEOK and any of its direct or indirect subsidiaries.

2.30 “Participant” means an (i) individual who is granted a Replacement Award under the Plan or who receives an Award of Stock Units pursuant to Section 12, or (ii) an Employee who the Committee determines is in a position to contribute significantly to the growth and profitability of, or to perform services of major importance to the Company and/or Subsidiaries, or Non-Employee Director, who is selected by the Committee to be a Participant in the Plan and to be granted a Stock Incentive under the Plan.

2.31 “Performance Goal” means one or more criteria or standards established by the Committee to determine, in whole or in part, whether a Performance Stock Incentive shall be awarded or earned, which may include the criteria and standards established pursuant to Section 17.9.

2.32 “Performance Period” means the time period designated by the Committee during which Performance Goals must be met.

2.33 “Performance Stock Award” means a Stock Incentive providing for a grant of shares of Common Stock the award or delivery of which is subject to specified Performance Goals.

2.34 “Performance Stock Incentive” means a Stock Incentive, including without limitation, a Performance Stock Award, Performance Unit Award, Restricted Stock Award, or Restricted Unit Award providing for the award, delivery or payment of shares of Common Stock or cash, or a combination of each, that is subject to specified Performance Goals.

2.35 “Performance Unit Award” means a Stock Incentive providing for a grant of a unit or units representing an amount of cash or shares of Common Stock (including a Stock Unit), or a combination of each, that will be distributed in the future if continued employment and/or other specified Performance Goals or other performance criteria specified by the Committee are attained; and which Performance Goals or other performance criteria may include, without limitation, corporate, divisional or business unit financial or operating performance measures, as more particularly described in Section 17.9; and which other contingencies may include the Participant’s depositing with the Company or a Subsidiary, acquiring or retaining for stipulated time periods specified amounts of Common Stock; and the amount of Stock Incentive may, but need not be determined by reference to the market value of Common Stock.

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2.36 “Plan” means the ONE Gas, Inc. Equity Compensation Plan, as amended from time to time.

2.37 “Plan Year” means the calendar year beginning on January 1 and ending the next December 31.

2.38 “Qualified Performance Stock Incentive” means a Performance Stock Incentive granted under the Plan that is intended to qualify as qualified performance based compensation under Section 162(m) of the Code, as described in Section 17.9.

2.39 “Replacement Award” means an Award granted under the Plan to replace an award that is outstanding immediately prior to the Distribution Date that was granted under one of the ONEOK Stock Programs and that are held by an Employee or Former ONE Gas Employee.

2.40 “Restricted Stock Award” means shares of Common Stock which are issued or transferred to a Participant under Section 6, below, and which will become free of restrictions specified by the Committee if continued employment and/or Performance Goals or other performance criteria specified by the Committee are attained; and which Performance Goals or other criteria, circumstances or conditions arise, exist or are satisfied; and which may but need not include, without limitation, corporate, divisional or business unit financial or operating performance measures, as more particularly described in Section 17.9

2.41 “Restricted Unit Award” means a Stock Incentive providing for a grant of a unit or units representing an amount of cash or shares of Common Stock or a combination of each, which become free of restrictions specified by the Committee if continued employment and/or Performance Goals or other criteria, circumstances or conditions arise, exist or are attained; and which may but need not include, without limitation, corporate, divisional or business unit financial or operating performance measures, as more particularly described in Section 17.9.

2.42 “SEC Rule 16b-3” means Rule 16b-3 of the Securities and Exchange Commission promulgated under the Exchange Act, as such rule or any successor rule may be in effect from time to time.

2.43 “Secretary” means the Secretary of the Company.

2.44 “Section 16 Person” means a person subject to Section 16(b) of the Exchange Act with respect to transactions involving equity securities of the Company.

2.45 “Section 409A” means Section 409A of the Code, and unless otherwise expressly indicated herein, all Treasury Regulations issued under Section 409A of the Code.

2.46 “Section 409A Deferred Compensation” means compensation provided pursuant to the Plan that constitutes deferred compensation subject to and not exempted from the requirements of Section 409A.

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2.47 “Separation” means the separation of ONEOK’s local natural gas distribution business into an independent, publicly traded entity to be known as the Company.

2.48 “Share” or “Shares” means a share or shares of Common Stock.

2.49 “Stock” has the same meaning as Common Stock.

2.50 “Stock Appreciation Right” means a right granted to a Participant denominated in shares of Common Stock, to receive, upon exercise of the right (or both the right and a related Option, if applicable in the case of issuance in tandem with an Option), an amount, payable in shares of Common Stock, in cash, or a combination thereof that does not exceed the excess of the Fair Market Value of the share or shares of Common Stock on the date such right is exercised over the base price of such share or shares provided in and for such right on the date such right is granted, as determined by the Committee.

2.51 “Stock Bonus Award” means an amount of cash or shares of Common Stock which is distributed to a Participant or which the Committee agrees to distribute in the future to a Participant in lieu of, or as a supplement to, any other compensation that may have been earned by services rendered prior to the date the distribution is made. Unless otherwise determined by the Committee, the amount of the award shall be determined by reference to the Fair Market Value of Common Stock. Performance Stock Awards, Performance Unit Awards, Restricted Stock Awards and Restricted Unit Awards are specific types of Stock Bonus Awards.

2.52 “Stock Incentive” means rights and incentive compensation granted under this Plan in one of the forms referred to and provided for in Section 3.

2.53 “Stock Unit” means a unit evidencing the right to receive under certain conditions or in specified circumstances one (1) share of Common Stock or equivalent value, as determined by the Committee.

2.54 “Subsidiary” means a corporation or other form of business association of which shares (or other ownership interest) having more than fifty percent (50%) of the voting power are or in the future become owned or controlled, directly or indirectly, by the Company; provided, however, that in the case of an Incentive Stock Option, the term “Subsidiary” shall mean a Subsidiary (as defined by the preceding clause) which is also a “subsidiary corporation” as defined in Section 424(f) of the Code.

2.55 “Time-Lapse Restricted Stock Incentive” means a Restricted Stock Award, Restricted Unit Award, or any other Stock Incentive the award of which is based solely on continued employment with the Company or any Subsidiary for a specified period of time.

3. Grants of Stock Incentives

3.1 Stock Incentives to Employees/Participants. Subject to the provisions of the Plan, the Committee may at any time, or from time to time, grant Stock Incentives to one or more Employees that the Committee selects to be a Participant in the Plan and to individuals who are

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eligible to receive a Replacement Award or Stock Units in connection with the Separation, which may be (i) Stock Bonus Awards, which may, but need not be Performance Stock Awards, Performance Unit Awards or Restricted Stock Awards, Restricted Unit Awards and/or (ii) Options, which may be Incentive Stock Options or Non-Statutory Stock Options, and/or (iii) Stock Appreciation Rights.

3.2 Non-Employee Director Awards. Subject to the provisions of the Plan, the Committee shall grant Director Stock Awards to Non-Employee Directors in accordance with Section 9 of the Plan. Notwithstanding anything else otherwise expressed or implied in the Plan, no other form of Stock Incentive shall be granted to Non-Employee Directors under the Plan, and in no event shall any grant of an Incentive Stock Option be made to a Non-Employee Director.

3.3 Modifications. After a Stock Incentive has been granted,

(a) the Committee may waive any term or condition thereof that could have been excluded from such Stock Incentive when it was granted, and

(b) with the written consent of the affected Participant, may amend any Stock Incentive after it has been granted to include (or exclude) any provision which could have been included in (or excluded from) such Stock Incentive when it was granted, and no additional consideration need be received by the Company in exchange for such waiver or amendment;

(c) provided, that modification of any Option or Stock Appreciation Right granted under the Plan shall be subject to the prohibition of repricing stated in Section 7.9 and Section 8.6, as applicable; and

(d) the modification of any Option or other Stock Incentive that provides for, or in order to provide for, deferral of compensation subject to Section 409A must meet all requirements under Section 409A and Treasury Regulations, including requirements applicable to Subsequent Elections and the requirement that acceleration of payment of deferred compensation shall not be permissible.

3.4 Forms of Stock Incentives. A particular form of Stock Incentive may be granted to a Participant either alone or in addition to other Stock Incentives hereunder. The provisions of particular forms of Stock Incentives need not be the same for each Participant.

4. Stock Subject to the Plan

4.1 Shares Authorized. The maximum number of shares of Common Stock authorized to be issued or transferred pursuant to all Stock Incentives granted under the Plan shall be two million eight hundred thousand (2,800,000) shares, subject to the provisions governing restoration of shares stated below in Section 4.4 and adjustment in Section 15.

4.2 Grant, Award Limitations. Notwithstanding the foregoing, in addition to the overall maximum limitation in Section 4.1,

(a) The maximum number of shares of Common Stock with respect to which Options or Stock Appreciation Rights may be granted or issued to any one (1) Employee or Participant in any Plan Year is five hundred thousand (500,000);

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(b) The maximum number of shares of Common Stock with respect to which Stock Incentives other than Options or Stock Appreciation Rights may be granted or issued to any one (1) Employee or Participant in any Plan Year is five hundred thousand (500,000);

(c) The maximum aggregate number of shares of Common Stock and the maximum dollar amount that may be issued or paid as Performance Stock Incentives to any one (1) Employee or Participant in any Plan Year are five hundred thousand (500,000) shares of Common Stock, and Ten Million Dollars ($10,000,000), respectively;

(d) The maximum aggregate number of shares of Common Stock that may be issued under the Plan through the granting of Time-Lapse Restricted Stock Incentives is two million eight hundred thousand (2,800,000);

(e) The maximum aggregate number of shares of Common Stock that may be issued under the Plan through the granting of Incentive Stock Options is two million three hundred eighty thousand (2,380,000); and

(f) The exercise of Incentive Stock Options is also subject to the calendar year dollar limitation provided in Section 422(d) of the Code and Section 7.6.

4.3 Source of Shares. Such shares may be authorized but unissued shares of Common Stock, shares of Common Stock held in treasury, whether acquired by the Company specifically for use under this Plan or otherwise, or shares issued or transferred to, or otherwise acquired by, a trust pursuant to Section 17.5, as the Committee may from time to time determine, provided, however, that any shares acquired or held by the Company for the purposes of this Plan shall, unless and until issued or transferred to a trust pursuant to Section 17.5, or to a Participant in accordance with the terms and conditions of a Stock Incentive, be and at all times remain authorized but unissued shares or treasury shares (as the case may be), irrespective of whether such shares are entered in a special account for purposes of this Plan, and shall be available for any corporate purpose.

4.4 Restoration and Retention of Shares. If any shares of Common Stock subject to a Stock Incentive shall not be issued or transferred to a Participant and shall cease to be issuable or transferable to a Participant because of the termination, expiration or cancellation, in whole or in part, of such Stock Incentive or for any other reason, or if any such shares shall, after issuance or transfer, be reacquired by the Company prior to the time a Stock Incentive vests because of the Participant’s failure to comply with the terms and conditions of the Stock Incentive, the shares not so issued or transferred, or the shares so reacquired by the Company, as the case may be, shall no longer be charged against the limitation provided for in Section 4.1 and may be used thereafter for additional Stock Incentives under the Plan; to the extent a Stock Incentive under the Plan is settled or paid in cash, shares subject to such Stock Incentive will not be considered to

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have been issued and will not be applied against the maximum number of shares of Common Stock provided for in Section 4.1. If a Stock Incentive may be settled in shares of Common Stock or cash, such shares shall be deemed issued only when and to the extent that settlement or payment is actually made in shares of Common Stock; to the extent a Stock Incentive is settled or paid in cash, and not shares of Common Stock, any shares previously reserved for issuance or transfer pursuant to such Stock Incentive will again be deemed available for issuance or transfer under the Plan. Notwithstanding anything to the contrary contained herein, the following Shares shall not be added to the Shares authorized for grant under Section 4.1 and will not be available for future Stock Incentive grants: (i) Shares tendered by a holder or withheld by the Company in payment of the exercise price of an Option; (ii) Shares tendered by the holder or withheld by the Company to satisfy any tax withholding obligation with respect to a Stock Incentive; and (iii) Shares subject to a Stock Appreciation Right that are not issued in connection with the stock settlement of the Stock Appreciation Right on exercise thereof. For avoidance of doubt, Replacement Awards shall reduce the maximum number of shares of Common Stock available for issuance or transfer under the Plan and such shares may again be deemed available for issuance or transfer under the Plan only in accordance with this Section.

5. Eligibility

An Employee who the Committee determines is in a position to contribute significantly to the growth and profitability of, or to perform services of major importance to, the Company and its Subsidiaries shall be eligible and may be designated by the Committee to participate in the Plan and be granted Stock Incentives as determined by the Committee, in its sole discretion, under the Plan. Subject to the provisions of the Plan, the Committee shall from time to time, in its sole discretion, select from such eligible Employees those to whom Stock Incentives shall be granted and determine the number of Shares to be granted and the form and terms of the such Stock Incentives. Non-Employee Directors shall be eligible to be granted Stock Incentives and to become Participants in the Plan to the extent provided in Sections 3.2 and 9 of the Plan.

6. Stock Bonus Awards, Performance Stock Awards, Performance Unit Awards, Restricted Stock Awards and Restricted Unit Awards

Stock Bonus Awards, Performance Stock Awards, Performance Unit Awards, Restricted Stock Awards and Restricted Unit Awards shall be subject to the following provisions:

6.1 Grants. An eligible Employee may be granted a Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award, or Restricted Unit Award, and a Non-Employee Director may be granted a Director Stock Award, whether or not he or she is eligible to receive similar or dissimilar incentive compensation under any other plan or arrangement of the Company or its Subsidiaries.

6.2 Issuance of Shares. Shares of Common Stock subject to a Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award or Restricted Unit Award, may be issued or transferred to a Participant at the time such Award is granted, or at any time subsequent thereto, or in installments from time to time, and subject to such terms and conditions, as the Committee shall determine. In the event that any such issuance or transfer

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shall not be made to the Participant at the time such Award is granted, the Committee may but need not provide for payment to such Participant, either in cash or shares of Common Stock, from time to time or at the time or times such shares shall be issued or transferred to such Participant, of amounts not exceeding the dividends which would have been payable to such Participant in respect of such shares (as adjusted under Section 15) if such shares had been issued or transferred to such Participant at the time such Award was granted.

6.3 Cash Settlement. Any Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award, or Restricted Unit Award may, in the discretion of the Committee, be settled or paid in cash, or shares of Common Stock, or in either cash or shares of Common Stock. If a Stock Incentive is settled or paid in cash, such settlement and/or payment shall be made on each date on which shares would otherwise have been delivered or become unrestricted, in an amount equal to the Fair Market Value on such date of the shares which would otherwise have been delivered or become unrestricted and the number of shares for which such cash payment is made shall be added back to the maximum number of shares available for use under the Plan. Shares of Common Stock shall be deemed to be issued only when and to the extent that a Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award, Restricted Unit Award or other Stock Incentive under the Plan is actually settled or paid in shares of Common Stock; and to the extent a Stock Incentive is settled or paid in cash, and not shares of Common Stock, any shares previously reserved for issuance or transfer pursuant to such Stock Incentive will again be deemed available for issuance or transfer under the Plan.

6.4 Terms of Awards. Stock Bonus Awards, Performance Stock Awards, Performance Unit Awards, Restricted Stock Awards and Restricted Unit Awards, shall be subject to such terms and conditions, including, without limitation, restrictions on the sale or other disposition of the shares issued or transferred pursuant to such Award, and conditions calling for forfeiture of the Award or the shares issued or transferred pursuant thereto in designated circumstances, as the Committee shall determine; provided, however, that upon the issuance or transfer of shares to a Participant pursuant to any such Award, the recipient shall, with respect to such shares, be and become a shareholder of the Company fully entitled to receive dividends, to vote and to exercise all other rights of a shareholder except to the extent otherwise provided in the Award. All or any portion of a Stock Bonus Award may but need not be made in the form of a Performance Stock Award, a Performance Unit Award, a Restricted Stock Award or a Restricted Unit Award.

6.5 Distribution, Payment and Transfer. The terms of each Stock Incentive and Award under the Plan shall provide that distribution, payment and transfer of Common Stock, cash or any other compensation shall not be subject to any feature or provision that would constitute a deferral of compensation, and transfer to the Participant shall be made so that the Participant actually receives such payment and transfer on or as soon as reasonably practicable after the end of the period during which such Stock Incentive or Award is subject to a substantial risk of forfeiture, and in no event later than a date within the same taxable year of the Participant in which such period ends, or, if later, by the 15^th day of the third calendar month following the date specified for payment under the Award and the Plan, and with respect to which the

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Participant shall not be permitted, directly or indirectly, to designate the taxable year of payment. Provided, that distribution, payment and transfer under an Award with a feature or provision that constitutes a deferral of compensation may be made under and pursuant to a Deferred Compensation Program, if established by the Committee pursuant to Section 11, at a specified time that is elected and provided for therein and subject to the provisions of such Award, and the terms and requirements of such Program and Section 409A, as provided for in Sections 11 and 13.

6.6 Loans Prohibited. The Committee shall not, without prior approval of the Company’s shareholders, grant any Stock Incentive that provides for the making of a loan or other extension of credit, directly or indirectly, by the Company, its Subsidiaries or Plan to an Employee, Participant, officer of the Company or its Subsidiaries, or any other person in connection with the grant, award or payment of such Stock Incentive.

6.7 Written Instrument. Each Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award and Restricted Unit Award shall be evidenced in writing as authorized and provided for in Section 17.4.

6.8 Director Awards. Director Stock Awards shall be granted as determined by the Committee in accordance with the provisions of Section 9, and as otherwise provided by this Plan.

7. Options

Options shall be subject to the following provisions:

7.1 Option Price. Subject to the provisions of Section 14, the purchase price per share shall be, in the case of an Incentive Stock Option, a Non-Statutory Stock Option, or any other Option granted under the Plan, not less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the date the Option is granted (or in the case of any optionee who, at the time an Incentive Stock Option is granted, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of his or her employer corporation or of its parent or subsidiary corporation, not less than one hundred ten percent (110%) of the Fair Market Value of a share of Common Stock on the date the Incentive Stock Option is granted).

7.2 Payment of Option Price. The purchase price of shares subject to an Option may be paid in whole or in part (i) in cash, (ii) by bank-certified, cashier’s or personal check subject to collection, (iii) if so provided in the Option and subject to such terms and conditions as the Committee may impose, by delivering to the Company a properly executed exercise notice together with a copy of irrevocable instructions to a stockbroker to sell immediately some or all of the shares acquired by exercise of the Option and to deliver promptly to the Company an amount of sale proceeds (or, in lieu of or pending a sale, loan proceeds) sufficient to pay the purchase price, or (iv) if so provided in the Option and subject to such terms and conditions as are specified in the Option, in shares of Common Stock or other property surrendered to the Company. Property for purposes of this section shall include an obligation of the Company or a

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Subsidiary unless prohibited by applicable law. Shares of Common Stock thus surrendered shall be valued at their Fair Market Value on the date of exercise. Any such other property thus surrendered shall be valued at its fair market value on any reasonable basis established or approved by the Committee. Notwithstanding any other provision of the Plan, the Committee shall not, without prior approval of the Company’s shareholders, grant an Option or any other Stock Incentive that provides for the making of a loan or other extension of credit, directly or indirectly, by the Company, a Subsidiary or the Plan to an Employee, Participant, officer of the Company or any of its Subsidiaries, or any other person in connection with the grant, exercise, payment or award of any such Option or other Stock Incentive.

7.3 Option Terms. Options may be granted for such lawful consideration, including money or other property, tangible or intangible, or labor or services received or to be received by the Company or a Subsidiary, as the Committee may determine when the Option is granted, including the agreement of the optionee to remain in the employ of the Company or one or more of its Subsidiaries at the pleasure of the Company (or the Subsidiaries) for such period, and on such terms, as are more particularly provided for therein. Property for purposes of the preceding sentence shall include an obligation of the Company or a Subsidiary unless prohibited by applicable law. Subject to the foregoing and the other provisions of this Section 7, each Option may be exercisable in full at the time of grant or may become exercisable in one or more installments, at such time or times and subject to satisfaction of such terms and conditions as the Committee may determine. The Committee may at any time accelerate the date on which an Option becomes exercisable, and no additional consideration need be received by the Company in exchange for such acceleration. Unless otherwise provided in the Option, an Option, to the extent it becomes exercisable, may be exercised at any time in whole or in part until the expiration or termination of the Option.

7.4 Exercise by Optionee. Each Option shall be exercisable during the life of the optionee only by him or her or his or her guardian or legal representative, and after the death of the optionee only by his or her Beneficiary or, absent a Beneficiary, by his or her estate or by a person who acquired the right to exercise the Option by will or the laws of descent and distribution; provided, that an Option that is made transferable by its terms and approved by the Committee pursuant to Section 17 shall be exercisable by a permissible transferee in accordance with the terms of the Option. Each Option shall expire at such time or times as the Committee may determine; provided, that notwithstanding any other provision of this Plan, (i) no Option shall be exercisable after the expiration of ten (10) years from the date the Option was granted, and (ii) no Incentive Stock Option which is granted to any optionee who, at the time such Option is granted, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of his or her employer corporation or of its parent or subsidiary corporation, shall be exercisable after the expiration of five (5) years from the date such Option is granted. The Committee may but need not provide for an Option to be exercisable after termination of employment until its fixed expiration date (or until an earlier date or specified event occurs). Unless otherwise specifically provided for under Section 11 and subject to the requirements of Section 13, an Option shall not provide for the deferral of compensation to a Participant.

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7.5 Exercise of Option. An Option shall be considered exercised if and when written notice, signed by the person exercising the Option, or an electronic communication if such communication is authorized and approved by the Committee in the terms of the Option, and stating the number of shares with respect to which the Option is being exercised, is received by the Secretary in or on a form approved for such purpose by the Committee, accompanied by full payment of the Option exercise price in one or more forms of payment authorized by the Committee described in Section 7.2 (together with all applicable withholding taxes), for the number of share purchased. No Option may at any time be exercised with respect to a fractional share.

7.6 Incentive Stock Options. An Option may, but need not, be an Incentive Stock Option. All shares of Common Stock which may be made subject to Stock Incentives under this Plan may be made subject to Incentive Stock Options; provided that the aggregate Fair Market Value (determined as of the time the Option is granted) of the stock with respect to which Incentive Stock Options may be exercisable for the first time by any Employee during any calendar year (under all plans, including this Plan, of his or her employer corporation and its parent and subsidiary corporations) shall not exceed One Hundred Thousand Dollars ($100,000) or such other amount, if any, as may apply under the Code. In no event shall an Incentive Stock Option be granted under the Plan more than ten (10) years from and after the date the Board approves the adoption of the Plan, or the date the Plan is approved by the shareholders of the Company, whichever is earlier. The Participant must notify the Company in writing within thirty (30) days after any disposition of Shares acquired pursuant to the exercise of an Incentive Stock Option within two years from the grant date or one year from the exercise date. The Participant must also provide the Company with all information that the Company reasonably requests in connection with determining the amount and character of Participant’s income, the Company’s deduction, and the Company’s obligation to withhold taxes or other amounts incurred by reason of a disqualifying disposition.

7.7 Written Instrument. Each Option shall be evidenced in writing as authorized and provided for in Section 17.4. An Option, if so approved by the Committee, may include terms, conditions, restrictions and limitations in addition to those provided for in this Plan including, without limitation, terms and conditions providing for the transfer or issuance of shares, on exercise of an Option, which may be non-transferable and forfeitable to the Company in designated circumstances.

7.8 Restored or Reload Options Prohibited. Notwithstanding any other provision of the Plan, the Committee shall not, without prior approval of Company’s shareholders, grant an Incentive Stock Option, Non-Statutory Option or other form of Option under this Plan containing any provision pursuant to which the optionee is to be granted a restored or reload Option of any kind by reason of the exercise of all or part of an Option by paying all or part of the exercise price of such Option by surrendering shares of Common Stock.

7.9 Repricing Prohibited. Notwithstanding any other provision of the Plan, except in connection with a corporate transaction involving the Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization,

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merger, consolidation, split-up, spin-off, combination, or exchange of shares), the terms of outstanding Stock Incentives may not, without Company shareholder approval, be amended to reduce the exercise price of outstanding Options, cancel outstanding Options in exchange for cash, other Stock Incentives or Options with an exercise price that is less than the exercise price of the original Options, or take any other action with respect to an Option that has the effect of buying out, repricing, replacing or regranting through cancellation underwater Options, including, but not limited to, any action that would be treated as a repricing under the rules and regulations of the principal securities exchange on which the Shares are traded.

7.10 Regulatory Compliance. No Option shall be exercisable unless and until the Company (i) obtains the approval of all regulatory bodies whose approval the General Counsel may deem necessary or desirable, and (ii) complies with all legal requirements deemed applicable by the General Counsel.

8. Stock Appreciation Rights

8.1 General. Subject to the terms of the Plan, Stock Appreciation Rights may be granted to Employees by the Committee upon such terms and conditions as the Committee determines; provided, that the base price per share of a freestanding Stock Appreciation Right shall be not less than one hundred percent (100%) of the Fair Market Value of a share of the Common Stock on the date of grant of a Stock Appreciation Right; and such Stock Appreciation Right shall be exercisable, or be forfeited or expire upon such terms as the Committee determines and are made a part of such Stock Appreciation Right.

8.2 Stock Appreciation Rights, Options. Stock Appreciation Rights may be granted by the Committee as freestanding Stock Incentives or in tandem with Options. A tandem Stock Appreciation Right may be included in an Option at the time the Option is granted or by amendment of the Option. Exercise of any such a tandem Stock Appreciation Right will be deemed to surrender the related Option for cancellation and vice versa.

8.3 Exercise. A Stock Appreciation Right shall be exercised by delivery of written notice (including facsimile or electronic transmittal) to the Committee setting forth the number of shares with respect to which the Stock Appreciation Right is exercised and date of exercise, at such time and as otherwise prescribed in the Stock Appreciation Right.

8.4 Settlement. A Stock Appreciation Right may be settled or paid in either cash, shares of Common Stock, or a combination thereof in accordance with its terms. If a Stock Appreciation Right is settled or paid in shares of Common Stock, such shares shall be deemed to be issued hereunder only when and to the extent that settlement or payment is actually made in shares of Common Stock. To the extent that a Stock Appreciation Right is actually settled in cash and not shares of Common Stock, any shares previously reserved for issuance or transfer pursuant to such Stock Appreciation Right shall again be deemed available for issuance or transfer under the Plan; and the maximum number of shares of Common Stock that may be issued under the Plan shall not be reduced by any actual settlement of a Stock Appreciation Right in cash. Unless otherwise specifically provided for under Section 11 and subject to the requirements of Section 13, a Stock Appreciation Right shall not provide for the deferral of compensation to a Participant.

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8.5 Written Instrument. Each Stock Appreciation Right granted shall be evidenced in writing as authorized and provided in Section 17.4.

8.6 Repricing Prohibited. Notwithstanding any other provision of the Plan, except in connection with a corporate transaction involving the Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares), the terms of outstanding Stock Incentives may not, without Company shareholder approval, be amended to reduce the exercise price of outstanding Stock Appreciation Rights, cancel outstanding Stock Appreciation Rights in exchange for cash, other Stock Incentives or Stock Appreciation Rights with an exercise price that is less than the exercise price of the original Stock Appreciation Rights or take any other action with respect to a Stock Appreciation Rights that has the effect of buying out, repricing, replacing or regranting through cancellation underwater Stock Appreciation Rights , including, but not limited to, any action that would be treated as a repricing under the rules and regulations of the principal securities exchange on which the Shares are traded.

9. Director Stock Awards

9.1 General. Each Non-Employee Director Participant shall receive such portion of his or her Director Fees in Common Stock as shall be established from time to time by the Board, with the remainder of such Director Fees to be payable in cash or in Common Stock as elected by the Non-Employee Director Participant in accordance with Section 9.2.

9.2 Non-Employee Director Election. Each Non-Employee Director Participant shall have an opportunity to elect to have the remaining portion of his or her Director Fees paid in cash or shares of Common Stock or a combination thereof. Except for the initial election following the Effective Date of the Plan, or the Director’s election to the Board, any such election shall be made in writing and must be made at least thirty (30) days before the beginning of the Plan Year in which the services are to be rendered giving rise to such Director Fees and may not be changed thereafter except by timely written election as to Director Fees for services to be rendered in a subsequent Plan Year. In the absence of such an election, such remaining portion of the Director Fees of a Non-Employee Director shall be paid entirely in cash. Nothing contained in this Section 9.2 shall be interpreted in such a manner as would disqualify the Plan for treatment as a “formula plan” under Rule 16b-3 pursuant to which the terms and conditions of each transaction authorized by Section 9.1 are fixed in advance by the relevant terms and provisions thereof.

9.3 Share Awards. The number of shares of Common Stock to be paid and distributed to a Non-Employee Director under the provisions of Sections 9.1 and 9.2, shall be determined by dividing the dollar amount of his or her Director Fees (which the Board has established, and/or such Non-Employee Director has elected) to be paid in Common Stock on any payment date by the Fair Market Value of a share of Common Stock on that date. Except as

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may otherwise be directed by the Committee, in its sole discretion, the payment and distribution of such shares to a Non-Employee Director shall be on or within five days after the date such Director Fees would otherwise have been paid to him or her in cash.

10. Replacement Awards

Employees and Former ONE Gas Employees, who immediately prior to the Distribution, held awards granted under any ONEOK Stock Programs shall be eligible to receive Replacement Awards in connection with the Distribution. Replacement Awards may be granted as Restricted Stock Unit Awards and/or Performance Unit Awards and shall have the same general terms and conditions as the awards held by Employees and Former ONE Gas Employees immediately prior to the Distribution, including the term of the award, except that: (i) Replacement Awards that are Performance Unit Awards relating to performance after the Separation shall provide for payment determined using actual performance results from the Separation until the last day of the performance period to which they relate, based on performance criteria to be established by the Committee in accordance with the Plan, and (ii) Replacement Awards that are Performance Unit Awards relating to performance before the Separation shall provide for payment based on continued service with the Company from the Separation until the last day of the performance period to which they relate. Except as otherwise provided in this Section, Replacement Awards shall be subject to the Plan terms and conditions.

11. Deferred Compensation Program

11.1 Establishment of Deferred Compensation Program. This Section 11 shall not be effective unless and until the Committee determines to establish a program or procedures under the Plan providing for deferral of compensation with respect to Awards (“Deferred Compensation Program”) pursuant to this Section. The Committee, in its discretion and upon such terms and conditions as it may determine, pursuant to Sections 6.2, 6.4, 7.3, 8.1 and 16.2 herein, and consistent with the requirements of Section 409A, may establish one or more Deferred Compensation Programs pursuant to the Plan under which:

(a) Deferred Compensation. Participants designated by the Committee may irrevocably elect, prior to a date specified by the Committee and subject to compliance with the requirements of Section 409A, to be granted an Award that provides for the deferral of compensation of Stock Units with respect to such number of shares of Common Stock and/or upon such other terms and conditions as established by the Committee in lieu of:

(1) shares of Common Stock otherwise issuable to a Participant upon the exercise of an Option;

(2) shares of Common Stock or cash otherwise issuable to a Participant upon the exercise of a Stock Appreciation Right;

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(3) shares of Common Stock or cash otherwise issuable to a Participant upon the settlement and date of distribution, payment and transfer of a Restricted Unit Award;

(4) shares of Common Stock or cash otherwise issuable to a Participant upon the settlement, distribution, payment and transfer of a Performance Unit Award; or

(5) shares of Common Stock or cash otherwise issuable to a Participant upon the settlement, distribution, payment and transfer of any other form of Stock Incentive and Award that may otherwise be granted under the Plan.

(b) Award Deferral Feature. The providing for the deferral of compensation under a Stock Incentive or Award, upon the granting of such Stock Incentive or Award, or by amendment or change of its terms, is intended to and shall only affect the time of distribution, payment and transfer of the Award, consistent with the nature of the Award as authorized by the Plan, and shall in no event expand the types of Awards available under the Plan, increase the number of Shares available under the Plan, expand the classes of persons eligible under the Plan, provide for any extension of the term of the Plan, change the method of determining a strike price of Options granted under the Plan, or provide for the deletion or any limitation of any provision of the Plan or the Award prohibiting re-pricing, and shall not increase the potential dilution of shareholders of the Company over the lifetime of the Plan.

(c) Section 409A Compliance. The provisions of the Plan and any amendment of the Plan with respect to the deferral of compensation or a deferred compensation feature under a Stock Incentive or Award are intended to satisfy the requirements of Section 409A. It is intended that any and all amendments of the Plan and any Awards to satisfy the requirements of Section 409A shall not be made in any manner so as to expand the types of Stock Incentives or Awards available under the Plan, and the Plan and all Awards shall be interpreted and applied in a manner consistent with such intent.

11.2 Terms and Conditions of Stock Incentives, Awards. Stock Incentives or Awards granted under the Plan that pursuant to this Section 11 provide for deferral of compensation, shall be evidenced by Award Agreements applicable to such Stock Incentives or Awards and other written instruments in such form as the Committee shall from time to time establish. Award Agreements and other written instruments evidencing such Award Agreements may incorporate all or any of the terms of the Plan by reference and, except as provided below, shall comply with and be subject to the terms and conditions of Section 13.

(a) Voting Rights; Dividend Equivalent Rights and Distributions. Participants shall have no voting rights with respect to shares of Stock represented by Stock Units until the date of the issuance of such shares of Common Stock. A Participant may be entitled to dividend equivalent rights with respect to the payment of cash dividends on Common Stock during the period beginning on the date the Stock Units are granted to the

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Participant and ending on the earlier of the date on which such Stock Units are settled, as provided for by the Award Agreement and determined by the Committee, subject to the terms and conditions of Section 13.

(b) Settlement, Payment and Transfer. A Participant electing to receive an Award of Stock Units pursuant to this Section 11 shall specify at the time of such election a settlement, distribution, payment and transfer date with respect to such Award in compliance with the requirements of Section 409A. The Company shall issue to the Participant on the specified payment date elected by the Participant, or established with respect to the Award, or as soon thereafter as practicable, a number of whole shares of Stock equal to the number of vested Stock Units subject to the Stock Unit Award. Such shares of Stock shall be fully vested, and the Participant shall not be required to pay any additional consideration (other than applicable tax withholding) to acquire such shares.

12. Deferred Company Shares Received in the Distribution.

Notwithstanding anything in this Plan to the contrary, each individual who, on the record date for the Distribution, holds an award of stock units issued in accordance with the individual’s election pursuant to the Deferred Compensation Program described in the ONEOK, Inc. Equity Compensation Plan (the “OKE ECP Deferred Compensation Program”) shall, effective as of the Effective Date, become a Participant and receive an Award of Stock Units pursuant to this Section 12 covering a number of Shares determined in accordance with the distribution ratio used in the Distribution. The time and form of settlement of an Award of Stock Units issued pursuant to this Section 12 shall be determined in accordance with a Participant’s original election pursuant to OKE ECP Deferred Compensation Program; provided, however, with respect to Participants who are employed by ONEOK following the Distribution, any Awards of Stock Units that will be settled upon (i) the individual’s separation from service will be settled only upon the individual’s separation from service from ONEOK or (ii) a change in the ownership or control of the company or in the ownership of a substantial portion of the assets of the company, will be settled only upon the a change in the ownership or control of ONEOK or in the ownership of a substantial portion of the assets of ONEOK.

13. Compliance With Section 409A

13.1 Awards Subject to Section 409A. The provisions of this Section 13 shall apply to any Stock Incentive or Award or portion thereof that provides for the deferral of compensation and is or becomes subject to Section 409A, notwithstanding any provision to the contrary contained in the Plan or the Award Agreement or other written instrument applicable to such Award. Awards subject to Section 409A include, without limitation:

(a) Any Nonstatutory Stock Option or Stock Appreciation Right that permits the deferral of compensation other than the deferral of recognition of income until the exercise of the Award;

(b) Each Stock Incentive or Award that provides for the deferral of compensation; and

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(c) Any Restricted Stock Unit Award, Performance Award, cash-based Award or Other Stock-based Award if such Award provides for the deferral of compensation and either (i) the Award provides by its terms for settlement, distribution, payment and transfer of all or any portion of the Award on one or more specified dates or (ii) the Committee permits or requires the Participant to elect, or the Committee designates one or more dates on which the Award will be settled, distributed, paid and transferred.

13.2 Deferral and/or Distribution Elections. Except as otherwise permitted or required by Section 409A and Treasury Regulations thereunder or other applicable Secretary of the Treasury published guidance, the following rules shall apply to any deferral of compensation and/or distribution elections (each, an “ Election ”) that may be permitted, required or designated by the Committee pursuant to an Award subject to Section 409A:

(a) All Elections must be in writing and specify the amount of the distribution, payment and transfer in settlement of an Award being deferred, as well as the Specific Time and form of distribution as permitted by this Plan, in accordance with Section 409A and the Treasury Regulations thereunder.

(b) All Elections shall be made by the end of the Participant’s taxable year prior to the year in which services commence for which an Award may be granted to such Participant; provided, however, that:

(1) if the Award provides for forfeitable rights under which the Participant has a legally binding right to a distribution, payment or transfer in a subsequent year that is subject to a condition requiring the Participant to continue to provide services for a period of at least 12 months from the date the Participant obtains a legally binding right to avoid forfeiture of the distribution, payment or transfer and the Election is made on or before the 30^th day after the Participant obtains a legally binding right to the Award, provided that the Election is made at least 12 months in advance of the earliest date the Participant at which a forfeiture condition could lapse, or

(2) if the Award qualifies as “performance-based compensation” for purposes of Section 409A and is based on services performed over a period of at least twelve (12) months, then the Election may be made no later than six (6) months prior to the end of such period to the extent permitted by Section 409A, or

(3) if the Election is otherwise permissible at a later date pursuant to Section 409A, the Treasury Regulations thereunder or other applicable guidance.

(c) Elections shall continue in effect until a written election to revoke or change such Election is received by the Company, except that a written election to revoke or change such Election must be made prior to the last day for making an Election determined in accordance with paragraph (b) above or as permitted by Section 13.3, and Section 409A.

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13.3 Subsequent Elections. Except as otherwise permitted or required by Section 409A, the Treasury Regulations thereunder or other applicable guidance, any Award subject to Section 409A which permits a subsequent Election (“Subsequent Election”) to delay the distribution or change the form of distribution in settlement of such Award shall comply with the following requirements:

(a) No Subsequent Election may take effect until at least twelve (12) months after the date on which the Subsequent Election is made;

(b) Each Subsequent Election related to a distribution, payment, or transfer in settlement of an Award not described in Section 13.4(b), 13.4(c) or 13.4(f) must result in a delay of the payment, distribution or transfer for a period of not less than five (5) years from the date such distribution, payment or transfer would otherwise have been made; and

(c) No Subsequent Election related to a distribution, payment or transfer pursuant to Section 13.4(d) shall be made less than twelve (12) months prior to the date of the first scheduled payment as to such distribution, payment or transfer.

13.4 Distributions Pursuant to Deferral Elections. Except as otherwise permitted or required by Section 409A or Treasury Regulations thereunder or other applicable guidance, no distribution, payment or transfer in settlement of an Award subject to Section 409A may commence earlier than:

(a) Separation from service within the meaning of and as provided for under Section 409A and the Treasury Regulations thereunder (“Separation from Service”);

(b) The date the Participant becomes Disabled (as defined below);

(c) Death;

(d) A Specified Time (or pursuant to a Fixed Schedule) that is either (i) designated by the Committee upon the grant of an Award and set forth in the Award Agreement evidencing such Award or (ii) specified by the Participant in an Election complying with the requirements of Section 13.2 and/or 13.3, as applicable;

(e) A change in the ownership or control of the Company or in the ownership of a substantial portion of the assets of the Company (within the meaning of and as provided for under Section 409A and the Treasury Regulations thereunder); or

(f) The occurrence of an Unforeseeable Emergency (as defined below and as provided for under by Treasury Regulations under Section 409A).

For purposes of the foregoing and the Plan, a “Specified Time” means a date or dates at which deferred compensation is payable and that are nondiscretionary and objectively determinable at the time the compensation is deferred, as provided for in Treasury Regulations

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under Section 409A; and “Fixed Schedule” means the distribution or payment of deferred compensation in a fixed schedule of distributions or payments that are determined and fixed at the time the deferral of such compensation is first elected or designated pursuant to the Plan and the requirements of Section 409A.

Notwithstanding anything else herein to the contrary, if a Participant becomes entitled to a distribution on account of a Separation from Service and is a “Specified Employee” (within the meaning of and as provided for under Section 409A and the Treasury Regulations thereunder) on the date of the Separation from Service, no distribution pursuant to Section 13.4(a) in settlement of an Award subject to Section 409A may be made before the date (the “Delayed Payment Date”) which is six (6) months after such Participant’s date of Separation from Service, or, if earlier, the date of the Participant’s death. All such amounts that would, but for this paragraph, become payable prior to the Delayed Payment Date shall be accumulated and paid on the Delayed Payment Date.

13.5 Unforeseeable Emergency. The Committee shall have the authority to provide in the Award Agreement evidencing any Award subject to Section 409A for distribution in settlement of all or a portion of such Award in the event that a Participant establishes, to the satisfaction of the Committee, the occurrence of an Unforeseeable Emergency. In such event, the amount(s) distributed with respect to such Unforeseeable Emergency cannot exceed the amounts necessary to satisfy such Unforeseeable Emergency plus amounts necessary to pay taxes reasonably anticipated as a result of such distribution(s), after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise, by liquidation of the Participant’s assets the liquidation of such assets would not itself cause severe financial hardship) or by cessation of deferrals under the Award. All distributions with respect to an Unforeseeable Emergency shall be made in a lump sum as soon as practicable following the Committee’s determination that an Unforeseeable Emergency has occurred. For purposes of the foregoing, Unforeseeable Emergency means a severe financial hardship to the Participant resulting from illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code Section 152(a)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary circumstances arising as a result of events beyond the control of the Participant, including such events and circumstances as and considered to be an Unforeseeable Emergency under Code section 409A and the regulations thereunder. It is intended and directed with respect to any such unforeseeable emergency that any amounts distributed under the Plan by reason thereof shall not exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship).

The occurrence of an Unforeseeable Emergency shall be judged and determined by the Committee. The Committee’s decision with respect to whether an Unforeseeable Emergency has occurred and the manner in which, if at all, the distribution, payment or transfer in settlement of an Award shall be altered or modified, shall be final, conclusive, and not subject to approval or appeal.

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13.6 Disability. The Committee shall have the authority to provide in any Award subject to Section 409A for distribution, payment or transfer in settlement of such Award in the event that the Participant becomes Disabled. A Participant shall be considered “Disabled” and that term shall mean that a Participant is unable to engage in substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident or health plan covering Employees of the Company. A Participant will be deemed to be Disabled if such Participant is determined to be totally disabled by the Social Security Administration.

All distributions payable by reason of a Participant becoming Disabled shall be paid in a lump sum or in periodic installments as established by the Participant’s Election, commencing as soon as practicable following the date the Participant becomes Disabled. If the Participant has made no Election with respect to distributions upon becoming Disabled, all such distributions shall be paid in a lump sum as soon as practicable following the date the Participant becomes Disabled.

13.7 Death. If a Participant dies before complete distribution, payment or transfer of amounts to be distributed, paid or transferred upon settlement of an Award subject to Section 409A, such undistributed amounts shall be distributed, paid or transferred to his or her beneficiary under the distribution and payment method for death established by the Participant’s Election as soon as administratively possible following receipt by the Committee of satisfactory notice and confirmation of the Participant’s death. If the Participant has made no Election with respect to distribution or payment upon death, distribution and payment shall be paid in a lump sum as soon as practicable following the date of the Participant’s death.

13.8 No Acceleration of Distributions. Notwithstanding anything to the contrary herein, this Plan does not permit the acceleration of the time or schedule of any distribution, payment or transfer under an Award subject to Section 409A, except as provided by Section 409A and/or the Treasury Regulations thereunder.

13.9 Additional Distribution Rule. Notwithstanding anything to the contrary herein, a distribution or payment shall be treated as made upon the date specified under the Plan if the payment is made at such date or a later date within the same taxable year of the Participant or, if later, by the 15th day of the third calendar month following the date specified under the Plan and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. Any distribution that complies with this section shall be deemed for all purposes to comply with the Plan requirements regarding the time and form of distribution.

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14. Certain Change in Control, Termination of Employment and Disability Provisions

Notwithstanding any provision of the Plan to the contrary, any Stock Incentive which is outstanding but not yet exercisable, vested or payable at the time of a Change in Control shall become exercisable, vested and payable at that time; provided, that if such Change in Control occurs less than six months after the date on which such Stock Incentive was granted and if the consideration for which such Stock Incentive was granted consisted in whole or in part of future services, then such Stock Incentive shall become exercisable, vested and payable at the time of such Change in Control only if the Participant agrees in writing (if requested to do so by the Committee in writing) to remain in the employ of the Company or a Subsidiary at least through the date which is six months after the date such Stock Incentive was granted with substantially the same title, duties, authority, reporting relationships and compensation as on the day immediately preceding the Change in Control. Any Option affected by the preceding sentence shall remain exercisable until it expires or terminates pursuant to its terms and conditions. Subject to the foregoing provisions of this Section 14, the Committee may at any time, and subject to such terms and conditions as it may impose:

(a) authorize the holder of an Option to exercise the Option following the termination of the Participant’s employment with the Company and its Subsidiaries, or following the Participant’s disability, whether or not the Option would otherwise be exercisable following such event, provided that in no event may an Option be exercised after the expiration of its term;

(b) grant Options which become exercisable only in the event of a Change in Control;

(c) authorize a Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award, or Restricted Unit Award to become non-forfeitable, fully earned and payable upon or following (i) the termination of the Participant’s employment with the Company and its Subsidiaries, or (ii) the Participant’s disability, whether or not the Award would otherwise become non-forfeitable, fully earned and payable upon or following such event;

(d) grant Stock Bonus Awards, Performance Stock Award, Performance Unit Awards, Restricted Stock Awards or Restricted Unit Awards which become non-forfeitable, fully earned and payable only in the event of a Change in Control; and

(e) provide in advance or at the time of Change in Control for cash to be paid in settlement of any Option, Stock Bonus Award, Performance Stock Award, Performance Unit Award, Restricted Stock Award or Restricted Unit Award in the event of a Change in Control, either at the election of the Participant or at the election of the Committee; provided that the Company shall not be required to pay cash in settlement of any Option when the Option purchase price per share exceeds the Fair Market Value of the underlying Shares.

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For avoidance of doubt, the Separation shall not constitute a Change in Control for purposes of the Plan. No Participant shall be treated as having terminated employment with the Company or any of its Subsidiaries for any purpose under the Plan as a result of the Separation or any transfers of employment between the Company and its Subsidiaries in contemplation of the Separation.

15. Adjustment Provisions

In the event that any recapitalization, or reclassification, split-up or consolidation of shares of Common Stock shall be effected, or the outstanding shares of Common Stock shall be, in connection with a merger or consolidation of the Company or a sale by the Company of all or a part of its assets, exchanged for a different number or class of shares of stock or other securities or property of the Company or any other entity or person, or a record date for determination of holders of Common Stock entitled to receive a dividend or other distribution payable in Common Stock or other property (other than normal cash dividends) shall occur, or other similar transaction, (i) the number and class of shares or other securities or property that may be issued or transferred pursuant to Stock Incentives thereafter granted or that may be optioned or awarded under the Plan to any Participant, (ii) the number and class of shares or other securities or property that may be issued or transferred under outstanding Stock Incentives, (iii) the purchase price to be paid per share under outstanding and future Stock Incentives, (iv) the terms and conditions of any outstanding Awards (including, without limitation, the performance period or any applicable performance targets or criteria with respect thereto); and (v) the price to be paid per share by the Company or a Subsidiary for shares or other securities or property issued or transferred pursuant to Stock Incentives which are subject to a right of the Company or a Subsidiary to reacquire such shares or other securities or property, shall in each case be equitably adjusted. Any such adjustments shall be done in a manner consistent with Code Sections 409A or 424, to the extent applicable. Any adjustment affecting an Award intended to qualify as qualified performance based compensation shall, to the extent determined by the Committee to be in the Company’s best interests, be consistent with the requirements of Code Section 162(m). The determination by the Committee as to the terms of any of the foregoing adjustments shall be conclusive and binding.

16. Administration

16.1 Committee. The Plan shall be administered by a committee of the Board of Directors consisting of two or more non-employee directors appointed from time to time by the Board of Directors. A majority of the Committee members shall constitute a quorum. The acts of a majority of the Committee members at a meeting at which a quorum is present or acts approved in writing by a majority of the Committee members shall be deemed acts of the Committee. Each member of the Committee shall satisfy such criteria of independence as the Board of Directors may establish and such regulatory or listing requirements as the Board of Directors may determine to be applicable or appropriate. No person shall be appointed to or shall serve as a member of such Committee unless at the time of such appointment and service he or she shall be a “Non-Employee Director,” as defined in SEC Rule 16b-3. Unless the Board of Directors determines otherwise, the Committee shall be comprised solely of “outside directors” within the meaning of Section 162(m)(4)(C)(i) of the Code.

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16.2 Committee Authority, Rules, Interpretations of Plan. The Committee may establish such rules and regulations, not inconsistent with the provisions of the Plan, as it may deem necessary for the proper administration of the Plan, and may amend or revoke any rule or regulation so established. The Committee shall, subject to the provisions of the Plan, have full power to interpret, administer and construe the Plan and any instruments issued under the Plan and full authority to make all determinations and decisions thereunder including without limitation the authority to (i) select the Participants in the Plan, (ii) determine when Stock Incentives shall be granted, (iii) determine the number of shares to be made subject to each Stock Incentive, (iv) determine the type of Stock Incentive to grant, (v) determine the terms and conditions of each Stock Incentive, including the exercise price, in the case of an Option, (vi) prescribe the terms and forms of written instruments evidencing Stock Incentives granted pursuant to and in accordance with the Plan and other forms necessary for administration of the Plan, and (vii) approve any transaction involving a Stock Incentive for a Section 16 Person (other than a “Discretionary Transaction” as defined in SEC Rule 16b-3) so as to exempt such transaction under SEC Rule 16b-3; provided, that any transaction under the Plan involving a Section 16 Person also may be approved by the Board of Directors, or may be approved or ratified by the shareholders of the Company, in the manner that exempts such transaction under SEC Rule 16b-3. The Committee may, at its discretion, delegate discretionary authority for day-to-day administration of the Plan to the Company’s Benefit Plan Administration Committee or its authorized representatives pursuant to a duly adopted resolution or a memorandum of action signed by all members of the Committee or approved via electronic transmission. All actions taken by the Company’s Benefit Plan Administration Committee or its authorized representative shall have the same legal effect and shall be entitled to the same deference as if taken by the Committee itself. The interpretation by the Committee of the terms and provisions of the Plan and any instrument or other evidence of a Stock Incentive issued thereunder, and its administration thereof, and all action taken by the Committee, shall be final, binding, and conclusive on the Company, the shareholders of the Company, Subsidiaries, all Participants and employees, and upon their respective Beneficiaries, successors and assigns, and upon all other persons claiming under or through any of them.

16.3 Section 409A Compliance Authority. Notwithstanding any other provision of the Plan to the contrary or any Award or Award Agreement, the Committee may, but shall not be required to, in its sole and absolute discretion and without the consent of any Participant, amend the Plan, or any Award Agreement, or other written instrument issued under the Plan, or take such other actions with respect to an Award of Award Agreement, to take effect retroactively or otherwise, as it deems necessary or advisable for the purpose of conforming the Plan, or such Award Agreement or other written instrument to any present or future law, regulation or rule applicable to the Plan or such Award or Award Agreement, including without limitation, Section 409A and Treasury Regulations issued under Section 409A.

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The Company intends that the Plan shall be administered and all Awards and Stock Incentives granted thereunder subject to Section 409A shall be administered, interpreted and applied in a manner that complies with Section 409A.

Provided, that the Company and the Committee makes no representations that Stock Incentives and Awards granted under the Plan shall be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude Section 409A of the Code from applying to Stock Incentives and Awards granted under the Plan. The Company, any of its Subsidiaries and the Committee shall not be responsible for any additional tax imposed upon a Participant or other person pursuant to Section 409A, nor shall the Company, any of its Subsidiaries or Committee indemnify or otherwise reimburse a Participant or other person for any liability incurred as a result of Section 409A.

16.4 Limitation of Liability. Members of the Board of Directors and members of the Committee acting under this Plan shall be fully protected in relying in good faith upon the advice of counsel and shall incur no liability except for gross or willful misconduct in the performance of their duties.

17. General Provisions

17.1 Nontransferability. Any provision of the Plan to the contrary notwithstanding, any Stock Incentive issued under the Plan, including without limitation any Option, shall not be transferable by the Participant other than by will or the laws of descent and distribution or to a Beneficiary designated by the Participant, unless the instrument evidencing the Stock Incentive expressly so provides (or is amended to so provide) and is approved by the Committee; and any purported transfer of an Incentive Stock Option to a Beneficiary, or other transferee, shall be effective only if such transfer is, in the opinion of the General Counsel, permissible under and consistent with SEC Rule 16b-3 or Section 422 of the Code, as the case may be. Notwithstanding the foregoing, a Participant may transfer any Stock Incentive granted under this Plan, other than an Incentive Stock Option, to members of his or her immediate family (defined as his or her children, grandchildren and spouse) or to one or more trusts for the benefit of such immediate family members or partnerships in which such immediate family members are the only partners if (and only if) the instrument evidencing such Stock Incentive expressly so provides (or is amended to so provide) and is approved by the Committee; provided, that under no circumstances shall any transfer of a Stock Incentive be made for value or consideration to the Participant. Any such transferred Stock Incentive shall continue to be subject to the same terms and conditions that were applicable to such Stock Incentive immediately prior to its transfer (except that such transferred Stock Incentive shall not be further transferable by the transferee inter vivos, except for transfer back to the original Participant holder of the Stock Incentive) and provided, further, that the foregoing provisions of this sentence shall apply to Section 16 Persons only if the General Counsel determines that doing so would not jeopardize any exemption from Section 16 of the Exchange Act (including without limitation SEC Rule 16b-3) for which the Company intends Section 16 Persons to qualify. The designation of a Beneficiary by a Participant pursuant to Section 17.15 is not a transfer for purposes of the foregoing provisions of this paragraph.

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17.2 No Employment Contract. Nothing in this Plan or in any instrument executed pursuant hereto shall confer upon any person any right to continue in the employment of the Company or a Subsidiary, or shall affect the right of the Company or a Subsidiary to terminate the employment of any person at any time with or without cause.

17.3 Conditions to Issuance of Shares; Securities Laws Compliance. No shares of Common Stock shall be issued or transferred pursuant to a Stock Incentive unless and until all legal requirements applicable to the issuance or transfer of such shares have, in the opinion of the General Counsel, been satisfied. Any such issuance or transfer shall be contingent upon the person acquiring the shares giving the Company any written assurances the General Counsel may deem necessary or desirable to assure compliance with all applicable legal requirements. The Company shall be under no obligation to any Participant to register for offering or resale or to qualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, any shares of Common Stock, security or interest in a security paid or issued under, or created by, the Plan, or to continue in effect any such registrations or qualifications if made. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the General Counsel to be necessary to the lawful issuance and sale of any Shares hereunder, will relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority will not have been obtained.

17.4 Written Instrument. A Stock Incentive and Award granted under this Plan shall be evidenced in writing in such manner as the Committee determines, including, without limitation, by written Award Agreement or other physical instrument, by electronic communication, or by book entry. Such written evidence of a Stock Incentive shall contain the terms and conditions thereof, consistent with this Plan, which shall be incorporated in it by reference. In the event of any dispute or discrepancy regarding the terms of a Stock Incentive, the records of the Board of Directors and Committee shall be determinative.

17.5 Limitation of Interest. No person (individually or as a member of a group) and no Beneficiary or other person claiming under or through him or her, shall have any right, title or interest in or to any shares of Common Stock (i) issued or transferred to, or acquired by, a trust, (ii) allocated, or (iii) reserved for the purposes of this Plan, or subject to any Stock Incentive except as to such shares of Common Stock, if any, as shall have been issued or transferred to him or her. The Committee may (but need not) provide at any time or from time to time (including without limitation upon or in contemplation of a Change in Control) for a number of shares of Common Stock, equal to the number of such shares subject to Stock Incentives then outstanding, to be issued or transferred to, or acquired by, a trust (including but not limited to a grantor trust) for the purpose of satisfying the Company’s obligations under such Stock Incentives, and, unless prohibited by applicable law, such shares held in trust shall be considered authorized and issued shares with full dividend and voting rights, notwithstanding that the Stock Incentives to which such shares relate shall not have been exercised or may not be exercisable or vested at that time.

17.6 Withholdings. The Company and its Subsidiaries may make such provisions as they may deem appropriate for the withholding of any taxes which they determine they are

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required to withhold in connection with the grant, exercise, vesting, distribution or payment of any Stock Incentive. Without limiting the foregoing, the Committee may, subject to such terms and conditions as it may impose, permit or require a Participant to satisfy all or part of his or her tax withholding obligations by (i) paying cash to the Company, (ii) having the Company withhold an amount from any cash amounts otherwise due or to become due from the Company to the Participant, (iii) having the Company withhold a number of shares of Common Stock that would otherwise be issued to the Participant having a Fair Market Value equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for federal, state, local and foreign income tax and payroll tax purposes, or (iv) surrendering a number of shares of Common Stock the Participant already owns having a Fair Market Value equal to the minimum statutory withholding rates for federal, state, local and foreign income tax and payroll tax purposes. The fair market value of the Shares to be withheld or delivered will be determined as of the date that the taxes are required to be withheld.

17.7 Other Plans. Nothing in this Plan is intended to be a substitute for, or shall preclude or limit the establishment or continuation of, any other plan, practice or arrangement for the payment of compensation or fringe benefits to directors, officers or employees generally, or to any class or group of such persons, which the Company or any Subsidiary now has or may hereafter lawfully put into effect, including, without limitation, any incentive compensation, retirement, pension, group insurance, stock purchase, stock bonus or stock option plan.

17.8 Section 16 Exemption Requirements. Any provision of the Plan to the contrary notwithstanding, except to the extent that the Committee determines otherwise, transactions by and with respect to Section 16 Persons under the Plan are intended to qualify for any applicable exemptions provided by SEC Rule 16b-3, and the provisions of the Plan and Stock Incentives granted under the Plan shall be administered, interpreted and construed to carry out such intent and any provision that cannot be so administered, interpreted and construed shall to that extent be disregarded.

17.9 Section 162(m) Qualification. Any provision of the Plan to the contrary notwithstanding, except to the extent the Committee determines otherwise, transactions with respect to persons whose remuneration would not be deductible by the Company but for compliance with the provisions of Section 162(m) of the Code are intended to be Qualified Performance Stock Incentives that comply with the provisions of Section 162(m) of the Code. The Plan is also intended to give the Committee the authority to award Stock Incentives that are Qualified Performance Stock Incentive awards that qualify as performance-based compensation under Section 162(m) of the Code, as well as Stock Incentives that are Non-Qualified Performance Stock Incentive awards that do not so qualify. Every provision of the Plan shall be administered, interpreted and construed to carry out such intent and any provision that cannot be so administered, interpreted and construed shall to that extent be disregarded. In administration and interpretation of the Plan:

(a) Performance Stock Incentives granted to Employees under the Plan that are intended to be Qualified Performance Stock Incentives shall be paid, vested or otherwise awarded and delivered solely on account of the attainment of one or more

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pre-established, objective Performance Goals established by the Committee in writing. A Performance Goal shall generally be pre-established prior to commencement of the Performance Period, and in no event later than the earlier of (i) ninety (90) days after the commencement of the period of service to which a Performance Goal relates, provided, that the outcome is substantially uncertain at the time the Performance Goal is established, and (ii) the lapse of twenty-five percent (25%) of the period of service (as scheduled in good faith at the time the Performance Goal is established), and in any event while the outcome is substantially uncertain. A Performance Goal shall be deemed objective if a third party having knowledge of the relevant facts could determine if it is met. Such a Performance Goal may be based on one or more business performance criteria that apply to a Participant, one or more business units, Subsidiaries, divisions or sectors of the Company, or the Company as a whole, and if so determined by the Committee, by comparison with a designated peer group of companies or businesses. A Performance Goal may include one or more of the following criteria or standards: (i) increased revenue, (ii) net income measures, including without limitation, income after capital costs, and income before or after taxes, (iii) stock price measures, including without limitation, growth measures and total stockholder return, (iv) market share, (v) earnings per share (actual or targeted growth), (vi) earnings before interest, taxes, depreciation, and amortization, (vii) economic value added, (viii) cash flow measures, including without limitation, net cash flow, and net cash flow before financing activities, (ix) return measures, including without limitation, return on equity, return on average assets, return on capital, risk adjusted return on capital, return on investors’ capital and return on average equity, (x) operating measures, including without limitation, operating income, funds from operations, cash from operations, after-tax operating income, sales volumes, production volumes, and production efficiency, (xi) expense measures, including but not limited to, finding and development costs, overhead costs, and general and administrative expense, (xii) margins, (xiii) shareholder value, (xiv) total shareholder return, (xv) reserve addition, (xvi) proceeds from dispositions, (xvii) total market value, and (xviii) corporate value criteria or standards including, without limitation, ethics, environmental and safety compliance.

(b) A Performance Goal need not be based upon an increase or a positive result under a particular business criterion, and may include, the maintaining of the status quo or limiting economic or financial losses measured by reference to specific business criteria. A Performance Goal must include business criteria, and a Performance Goal shall not be established or be considered to exist based on the mere continued employment of an Employee.

(c) Performance Goals may be identical for all Participants, or may be different for one or more Participants, as determined by the Committee in its sole discretion.

(d) In interpreting the provisions of the Plan and Stock Incentives granted under the Plan applicable to Qualified Performance Stock Incentives, it is intended that the Plan will conform with the standards and requirements of Section 162(m) of the Code

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and Treasury Regulation §1.162-27(e)(2), and any successor provisions of the Code and Treasury Regulations as to Stock Incentives granted to those Employees whose compensation is, or likely to be, subject to Section 162(m) of the Code, and the Committee in establishing Performance Goals and interpreting the Plan and Stock Incentives shall be guided by such provisions, as it determines, in its sole discretion.

(e) Prior to the payment or distribution of any compensation based upon the achievement of Performance Goals for a Qualified Performance Stock Incentive, the Committee shall certify in writing that the applicable Performance Goals and any of the material terms thereof were, in fact, satisfied. The approved minutes of a Committee meeting or written memorandum of action of the Committee without a meeting in which the certification is made may be treated as a written certification. Certification by the Committee is not required for compensation that is attributable solely to the increase in the value of the Common Stock.

(f) Subject to the foregoing provisions, the terms, conditions and limitations applicable to any Qualified Performance Stock Incentives that are granted pursuant to the Plan shall be determined by the Committee.

17.10 Plan Acceptance. By accepting any benefits under the Plan, each Participant, and each person claiming under or through a Participant shall be conclusively deemed to have indicated his or her acceptance and ratification of, and consent to, all provisions of the Plan and any action or decision under the Plan by the Company, its agents and employees, any of its Subsidiaries and their agents and employees, the Board of Directors and the Committee.

17.11 Governing Law. The validity, construction, interpretation and administration of the Plan and of any determinations or decisions made thereunder, and the rights of all persons having or claiming to have any interest therein or thereunder, shall be governed by, and determined exclusively in accordance with, the laws of the State of Oklahoma, but without giving effect to the principles of conflicts of laws thereof. Without limiting the generality of the foregoing, the period within which any action arising under or in connection with the Plan must be commenced, shall be governed by the laws of the State of Oklahoma, without giving effect to the principles of conflicts of laws thereof, irrespective of the place where the act or omission complained of took place and of the residence of any party to such action and irrespective of the place where the action may be brought.

17.12 No Secured Interest. A Participant shall have only a right to shares of Common Stock or cash or other amounts, if any, payable in settlement of a Stock Incentive under this Plan, unsecured by any assets of the Corporation or any other entity.

17.13 Gender and Singular References. The use of the masculine gender shall also include within its meaning the feminine. The use of the singular shall include within its meaning the plural and vice versa.

17.14 Death of Participant. Unless otherwise specified in the Stock Incentive, if the person to whom the Stock Incentive is granted dies, then (1) an Option that is not yet exercisable

33

shall become immediately exercisable in full, (2) any remaining restrictions with respect to the Stock Incentive shall expire, and (3) the Committee may alter or accelerate the settlement schedule, Performance Goals or other performance criteria, or payment or other terms of any Stock Incentive.

17.15 Beneficiary Designation. A Participant to whom a Stock Incentive is granted under this Plan may designate a Beneficiary in writing and in accordance with such requirements and procedures as the Committee may establish.

17.16 Company Policies. All Awards granted under the Plan shall be subject to any applicable clawback or recoupment policies, share trading policies and other policies that may be implemented by the Board from time to time.

18. Plan Amendment and Termination

The Plan may be amended by the Board of Directors, without shareholder approval, at any time and in any respect, unless approval of the amendment in question by the shareholders of the Company is required under Oklahoma law, the Code (including without limitation Code Section 422), any applicable exemption from Section 16 of the Exchange Act (including without limitation SEC Rule 16b-3) for which the Company intends Section 16 Persons to qualify, any national securities exchange or system on which the Common Stock is then listed or reported, by any regulatory body having jurisdiction with respect to the Plan, or under any other applicable laws, rules or regulations, in which case such amendment shall be effective only if and to the extent it is approved by the shareholders of the Company as so required. The Plan may also be terminated at any time by the Board of Directors. No amendment or termination of this Plan shall adversely affect any Stock Incentive granted prior to the date of such amendment or termination without written consent of the Participant. Notwithstanding any other provision of the Plan to the contrary, the Committee may, in its sole and absolute discretion and without the consent of any Participant, amend the Plan or any Award Agreement, or any written instrument issued under the Plan, to take effect retroactively or otherwise, as it deems necessary or advisable for the purpose of conforming the Plan or such Award Agreement or instrument to any present or future law, regulation or rule applicable to the Plan, including, without limitation, Section 409A.

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EX-10.14

Exhibit 10.14

RESTRICTED STOCK

UNIT AWARD

AGREEMENT

This Restricted Stock Unit Award Agreement is entered into as of the [    ] day of [            , 20    ], by and between ONE Gas Company, Inc., an Oklahoma corporation, (the “Company”), and «Officer_Name» (the “Grantee”), an employee of the Company or a Subsidiary thereof, pursuant to the terms of the ONE Gas, Inc. Equity Compensation Plan (the “Plan”).

1. Restricted Unit Award. This Restricted Stock Unit Award Agreement and that certain Restricted Unit Award, dated [            , 20    ], a copy of which is attached hereto and incorporated herein by reference (collectively, the “Agreement”), constitute evidence of the grant of a Restricted Unit Award (the “Award”) of «No_of_Restricted_Units» Restricted Units to the Grantee by the Company that shall entitle the Grantee to receive shares of the Company’s common stock (the “Common Stock”) pursuant to the terms and conditions of this Agreement and of the Plan. The Award and Restricted Units granted pursuant to this Agreement include the right of Grantee to receive dividend equivalents (“Dividend Equivalents”) upon the declaration and payment of dividends by the Company to all holders of all common stock to the extent and as provided for in paragraph 5 of this Agreement. This Agreement, when executed by the Grantee, constitutes an agreement between the Company and the Grantee.

2. Plan. Notwithstanding any provisions herein to the contrary, should there be any inconsistency between the provisions of this Agreement and the terms of the Award stated in the resolutions and records of the Board of Directors or the Plan, the provisions of such resolutions and records of the Plan shall control. Except where expressly stated or clearly indicated otherwise by the terms of this Agreement, all terms, words and phrases used herein shall have the same meaning and effect as stated and as defined in the Plan.

3. Grantee’s Agreement Concerning Award and Employment. In consideration of the Company’s granting the Award as incentive compensation to Grantee pursuant to this Agreement, the Grantee by acceptance thereof, and signing this Agreement evidencing its terms, agrees to such terms and to continue to contribute and perform service in the employ of the Company (or a Subsidiary thereof) at the direction, will and pleasure of the Company. Provided, however, neither the foregoing agreement of the Grantee in this paragraph 3, nor any other provision in the Plan shall confer on the Grantee any right to continue in the employ of the Company (or a Subsidiary thereof), or interfere in any way with the right of the Company (or such Subsidiary) to terminate the Grantee’s employment at any time.

4. Registration of Stock; Grantee’s Representation With Respect to Acquiring for Investment. It is intended by the Company that the Plan and shares of Common Stock covered by the Award issued and granted to the Grantee referred to in paragraph 1, above, are to be registered under the Securities Act of 1933, as amended, prior to the grant date; provided, that in the event such registration is for any reason not made effective for such shares, the Grantee agrees, for the Grantee, and for the Grantee’s heirs and legal representatives by inheritance or bequest, that all shares acquired pursuant to the grant will be acquired for investment and not

with a view to, or for sale or tender in connection with the distribution of any part thereof, including any transfer or distribution of such shares by the Grantee pursuant to the grant and this Agreement or as otherwise allowed by the Plan.

5. Restrictions; Restricted Period; Transfer of Common Stock to Grantee. The issue and grant of the Award to the Grantee stated in paragraph 1, above, are subject to the following terms and conditions:

(a) The ownership and transfer of the Restricted Units granted hereunder shall be restricted during the period beginning [            , 20    ], the grant date thereof (the “Grant Date”) and ending on [            , 20    ], (which period is hereinafter referred to as “Restricted Period”), as herein provided.

(b) The Restricted Units, or any Common Stock or cash to be paid or transferred to Grantee pursuant to the Award may not be sold, assigned, transferred, pledged, encumbered or otherwise disposed of by Grantee or any other person except as provided in this Agreement and the Plan until the expiration of the Restricted Period.

(c) Except as otherwise provided in the Agreement, the Grantee shall earn and become vested and entitled to the Restricted Units granted by this Award under paragraph 1, above, at the end of the Restricted Period if the Grantee’s employment by the Company (or Subsidiary thereof) does not terminate during the Restricted Period. Upon expiration of the Restricted Period, the Grantee shall be entitled to receive, and the Company shall issue to Grantee one (1) share of Common Stock for each Restricted Unit that becomes earned by and vested in the Grantee pursuant to the Award. The Common Stock the Grantee becomes entitled to receive under the Award shall be paid, distributed, transferred and issued on the last day of the Restricted Period, or as soon as practicable after such date as determined by the Committee, but in no event after the 15^th day of the third month after such date.

(1) The Grantee shall become vested in the Restricted Units granted hereunder and Common Stock paid and transferred pursuant to the Award free and clear of all restrictions imposed by the Award if the Grantee’s employment by the Company (or Subsidiary thereof) does not terminate during the Restricted Period; provided, that the Grantee shall become partially vested in the Restricted Units and Common Stock payable pursuant to the Award and the restrictions imposed by the Award shall partially cease to apply in certain events to the extent described in paragraph 6(d), below.

(2) If the Grantee’s employment with the Company (or Subsidiary thereof) terminates prior to the end of the Restricted Period by reason of (i) the Grantee’s voluntary termination of employment with the Company (or Subsidiary), or (ii) the involuntary Termination for Cause by the Company of the Grantee’s employment with the Company (or Subsidiary), the Grantee shall forfeit all the Grantee’s right, title or interest in the Restricted Units, and to any Common Stock payable or to be issued pursuant to the Award. Any such termination of employment described in the preceding sentence shall not be deemed to occur by reason of transfer of employment of the Grantee by or between the Company and any Subsidiary.

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(3) The Grantee shall not be entitled to vote any shares of Common Stock and, except as provided in paragraph 5(c)(4), the Grantee shall not have any right or interest as a holder of Common Stock by reason of the Award granted under this Agreement prior to the end of the Restricted Period and actual issuance of Common Stock to the Grantee pursuant to the Award.

(4) During the Restricted Period Grantee shall earn and Dividend Equivalents shall be credited to Grantee with respect to Restricted Units in the form of additional Restricted Units (“Additional Restricted Units”) to the extent and as provided for in this Agreement, as follows:

(i) On each date on which (a) the Restricted Units and Additional Restricted Units credited to Grantee pursuant to the Award under this Agreement have not become vested or have not been forfeited pursuant to the terms of this Agreement, and (b) the Company declares and pays a cash dividend to holders of Common Stock (each, a “Dividend Payment Date”), a number of Additional Restricted Units will be credited to Grantee in an amount (including fractional Additional Restricted Units) determined by dividing (x) the aggregate cash dividends that would have been paid on the number of shares of Common Stock (including fractional shares of Common Stock) into which the Restricted Units and Additional Restricted Units theretofore granted and credited to the Grantee under this Agreement on the Dividend Payment Date would be converted if vested on such date, by (y) the Fair Market Value of a share of Common Stock on such Dividend Payment Date.

(ii) The Additional Restricted Units credited to Grantee pursuant to paragraph 5(c)(4)(i) shall be added to and included in a cumulative aggregate amount of Additional Restricted Units credited to the Grantee hereunder, which shall be recorded and accounted for as a separate identifiable amount to the credit of the Grantee (“Additional Restricted Units Amount”).

(iii) Except as provided below with respect to the treatment of a fractional Additional Restricted Unit or fractional share of Common Stock attributable to Grantee upon vesting hereunder, all the Additional Restricted Units and the Additional Restricted Units Amount so credited to Grantee shall be subject to the same terms and conditions as the Restricted Units granted pursuant to paragraph 1 above, and such Additional Restricted Units and Additional Restricted Units Amount shall be forfeited in the event that the Restricted Units granted pursuant to paragraph 1, above are forfeited.

(iv) Unless otherwise expressly stated herein, any reference to Restricted Units in this Agreement shall be deemed to similarly and in like manner refer and apply to Additional Restricted Units credited to Grantee.

(v) The Grantee shall earn and become vested and entitled to the Additional Restricted Units granted by this Award under this paragraph 5(c)(4) at the end of the Restricted Period. Upon expiration of the Restricted Period, Grantee shall be entitled to receive, and the Company shall issue to Grantee one (1) share of Common Stock for each Additional Restricted Unit that becomes earned by and vested in Grantee pursuant to the Award; provided, that the shares of Common Stock to be issued to and received by Grantee for Additional

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Restricted Units, shall be only issued in whole shares of Common Stock, and any fractional share of Common Stock attributable to the Additional Restricted Units credited to Grantee shall paid to Grantee in an amount of cash equal to the Fair Market Value of a fractional share of Common Stock.

6. Transferability of Restricted Units, Cash or Common Stock; Termination of Employment.

(a) Except as provided in subparagraph (b) of this paragraph 6, below, this Agreement, the Grantee’s rights and obligations hereunder, and the Restricted Units granted hereunder shall not be transferable by the Grantee otherwise than by will or the laws of descent and distribution which apply to the Grantee’s estate.

(b) Notwithstanding the foregoing, the Grantee may transfer any part or all of the Grantee’s rights in the Restricted Units to members of the Grantee’s immediate family, or to one or more trusts for the benefit of such immediate family members, or partnerships in which such immediate family members are the only partners if the Grantee does not receive any consideration for the transfer. In the event of any such transfer, Restricted Units shall continue to be subject to the same terms and conditions otherwise applicable hereunder and under the Plan immediately prior to its transfer, except that such rights shall not be further transferable by the transferee inter vivos, except for transfer back to the original Grantee. For any such transfer to be effective, the Grantee must provide prior written notice thereof to the Committee, unless otherwise authorized and approved by the Committee, in its sole discretion; and the Grantee shall furnish to the Committee such information as it may request with respect to the transferee and the terms and conditions of any such transfer. For purposes of transfer of this grant under this subparagraph (b), “immediate family” shall mean the Grantee’s spouse, children and grandchildren.

(c) Notwithstanding any provision in this Agreement to the contrary, all rights and interest of the Grantee in the Restricted Units shall become invalid and wholly terminated and forfeited upon (i) the Grantee’s voluntary termination of the Grantee’s employment with the Company (or Subsidiary), or (ii) the involuntary Termination for Cause by the Company of the Grantee’s employment with the Company (or Subsidiary).

(d) Notwithstanding the foregoing provisions, in the event of termination of the Grantee’s employment with the Company (or Subsidiary) during the Restricted Period by reason of (i) the involuntary termination of the Grantee’s employment with the Company (or a Subsidiary) other than a Termination for Cause (ii) the Retirement of the Grantee, (iii) the Total Disability of the Grantee, or (iv) the Grantee’s death while still employed by the Company (or Subsidiary), then partial vesting shall be allowed as provided in this paragraph 6(d) and the Grantee shall become vested in and receive, in the event of any such involuntary termination of employment other than a Termination for Cause, Retirement or Total Disability, and the legatees, designated Beneficiary, personal representative or heirs of the Grantee shall be vested in and entitled to receive, in the event of the Grantee’s death, the percentage of the Restricted Units which is determined by dividing the number of full months which have elapsed under the Restricted Period at the time of such termination of employment by the number of full months in the Restricted Period. The Grantee, or legatees, designated Beneficiary, personal representative

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or heirs of the Grantee, as applicable, shall be entitled to receive and the Company shall issue, to the Grantee, or such legatees, designated Beneficiary, personal representative or heirs, as applicable, one share of Common Stock for each vested Restricted Unit, which shall be issued, paid and transferred pursuant to the Award free and clear of all restrictions imposed by the Award on the last day of the Restricted Period, or as soon as practicable thereafter as determined by the Committee, but in no event later than the 15^th day of the third calendar month after the last day of the Restricted Period.

(e) The Grantee may designate a Beneficiary to receive any rights of the Grantee which may become vested in the event of the death of the Grantee under procedures and in the form established by the Committee; and in the absence of such designation of a beneficiary, any such rights shall be deemed to be transferred to the estate of the Grantee.

(f) For purposes of the Award and this Agreement, an “involuntary termination” shall mean that the Company (or Subsidiary) has ended the Grantee’s employment with the Company (or Subsidiary) without the Grantee having an opportunity to continue employment with the Company (or Subsidiary); an “involuntary Termination for Cause” of the Grantee’s employment with and by the Company (or Subsidiary) shall mean that the Company (or Subsidiary) has ended such employment by reason of (i) the Grantee’s conviction in a court of law of a felony, or any crime or offense involving misuse or misappropriation of money or property, (ii) the Grantee’s violation of any covenant, agreement or obligation not to disclose confidential information regarding the business of the Company (or Subsidiary), (iii) any violation by the Grantee of any covenant not to compete with the Company (or Subsidiary), (iv) any act of dishonesty by the Grantee which adversely effects the business of the Company (or Subsidiary), (v) any willful or intentional act of the Grantee which adversely affects the business of, or reflects unfavorably on the reputation of the Company (or Subsidiary), (vi) the Grantee’s use of alcohol or drugs which interferes with the Grantee’s Restricted of duties as an employee of the Company (or Subsidiary), or (vii) the Grantee’s failure or refusal to perform the specific directives of the Company’s Board of Directors, or its officers which directives are consistent with the scope and nature of the Grantee’s duties and responsibilities with the existence and occurrence of all of such causes to be determined by the Company, in its sole discretion; provided, that nothing contained in the foregoing provisions of this paragraph shall be deemed to interfere in any way with the right of the Company (or Subsidiary), which is hereby acknowledged, to terminate the Grantee’s employment at any time without cause; and “voluntary termination” shall mean that the Grantee had an opportunity to continue employment with the Company (or Subsidiary), but did not do so.

(g) For purposes of the Award and this Agreement, “Retirement” shall mean a voluntary termination of employment of the Grantee with the Company (or Subsidiary) by the Grantee if at the time of such termination of employment the Grantee has both completed five (5) years of service with the Company (or Subsidiary) and attained age fifty (50); and “Total Disability” shall mean that the Grantee is permanently and totally disabled and unable to engage in any substantial gainful activity by reason of a medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months, and has established such disability to the extent and in the manner and form as may be required under the provisions of Code Section 22(e)(3) and regulations thereunder.

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7. Deferral of Payment, Distribution and Transfer of Stock.

(a) The payment, distribution and transfer of Restricted Units, Common Stock and cash of the Grantee becomes entitled to receive upon the Grantee’s separation from service with the Company upon the Grantee’s Retirement prior to the end of the Restricted Period under paragraph 6(d), above, shall be paid, distributed and transferred to the Grantee in a single payment, distribution and transfer at the Specified Time of the Grantee’s separation from service with the Company by such Retirement, as soon as practicable thereafter as determined by the Committee, but in no event later than the 15^th day of the third calendar month after date of such Retirement, and the Grantee shall not be permitted, directly or indirectly, to designate the time of payment, distribution and transfer or the taxable year in which it is to be made. The Specified Time of payment, distribution and transfer of any other compensation that is deferred under this Agreement or the Award shall be the last day of the Restricted Period, or as soon as practicable thereafter as determined by the Committee, but in no event later than the 15^th day of the third calendar month after the date of end of the Restricted Period, and the Grantee shall not be permitted, directly or indirectly, to designate the time of payment, distribution or transfer or the taxable year in which it is to be made.

(b) The Specified Time of payment and form of payment specified in paragraph 6(a), above shall be considered as the irrevocable deferral election of the Company and the Grantee of the time and form of payment for purposes of the application to this Agreement and the Award of the provisions of Code Section 409A and the provisions of this Agreement related thereto. No other election to defer compensation, or subsequent election or acceleration of the time and form of payment of compensation is intended or shall be allowed.

(c) The provisions of this Agreement providing for the deferral of payment, distribution, transfer or issuance of Restricted Units, Common Stock or cash shall be applicable solely and exclusively to the Grantee and the Award Agreement and Award referred to herein, and shall not apply to any other stock incentive or other grant, award or transfer provided for or made under the Plan.

(d) Notwithstanding anything otherwise provided under the Plan or in this Agreement the following requirements shall apply to this Award Agreement and the Award, to all elections or subsequent elections made by the Grantee, and to all distributions and payments made to the Grantee pursuant to this Award Agreement and Award.

(1) Any compensation for services performed by the Grantee during a taxable year may be deferred only if the election to defer such compensation by the Grantee or the Company is made not later than the close of the preceding taxable year or such other time as provided in Treasury Regulations under Code Section 409A, but in all events any deferral of the payment, distribution, transfer or issuance of Restricted Units, Common Stock or cash pursuant to the Award and Award Agreement may be made only by an election that is made on or before the Election Date.

(2) Any compensation deferred shall not be distributed earlier than:

(i) Separation from Service of the Grantee,

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(ii) the date the Grantee becomes Disabled,

(iii) death of the Grantee,

(iv) Specified Time (or pursuant to a Fixed Schedule) specified under the plan under which the compensation is deferred at the date of deferral of such compensation,

(v) a Change in Ownership or Control, or

(vi) the occurrence of an Unforeseeable Emergency.

(3) To the extent that a distribution is subject to Code Section 409A and Grantee becomes entitled to such distribution on account of a Separation from Service and is a Specified Employee on the date of the Separation from Service, no payment or distribution shall be made before the date which is six (6) months after the date of the Grantee’s Separation from Service, or, if earlier, the date of death of the Grantee.

(4) No acceleration of the time or schedule of any distribution or payment under the plan under which compensation is deferred shall be permitted or allowed, except to the extent provided in Treasury Regulations issued under Code section 409A.

(5) This Agreement shall not permit a subsequent election, unless authorized and agreed to in writing by the Company and Grantee; and if under the Plan or this Agreement compensation is deferred or the Committee acting pursuant to the Plan, permits under any subsequent election by a Participant a delay in a payment or a change in the form of payment of compensation deferred under this Award Agreement and Award, such subsequent election shall not take effect until at least twelve (12) months after the date on which it is made. In the case of a subsequent election related to a payment to be made upon Separation from Service of the Grantee, at a Specified Time or pursuant to a Fixed Schedule, or upon a Change in Ownership or Control, the first payment with respect to which such subsequent election is made shall be deferred for a period of not less than five (5) years from the date such payment would otherwise have been made; and any such subsequent election related to a payment at a Specified Time or pursuant to a Fixed Schedule may not be made less than twelve (12) months prior to the date of the first scheduled payment to which it relates.

(6) For purposes of the Plan, this Agreement and the Award, and the entitlement to and time of payment of any compensation deferred under this Agreement or the Award, the following terms and definitions shall apply:

(i) “Change of Ownership or Control” means to the extent provided by Treasury Regulations issued under Code Section 409A, a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, which shall be if (i) a person acquires more than 50% of the Company’s stock; (ii) a person acquires during a 12-month period at least 30% (or a higher percentage specified under the Plan) of the Company’s stock; (iii) a majority of the members of the Board of Directors are replaced during a 12-month period; or (iv) a person acquires during a 12-month period at least 40% of the gross fair market value of the Company’s assets.

(ii) “Disabled” means that an individual (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental

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impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the individual’s employer

(iii) “Fixed Schedule” means the distribution or payment of compensation deferred under this Agreement and Award in a fixed schedule of distributions or payments that are determined and fixed at the time the deferral of such compensation is first elected by the Grantee or the Company.

(iv) “Specified Employee” means a key employee (as defined in Code section 416(i) without regard to paragraph (5) thereof) of the Company.

(v) “Specified Time” means a specified date at which deferred compensation deferred by or for the Grantee pursuant to this Agreement is required to be distributed or paid and which is specified at the time of the election of deferral of such deferred compensation.

(vi) “Unforeseeable Emergency” means a severe financial hardship to the participant resulting from an illness or accident of the participant, the participant’s spouse, or a dependent (as defined in Code section 152(a)) of the participant, loss of the participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the participant. As determined under Treasury Regulations under Code section 409A, the amounts distributed with respect to an emergency shall not exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship).

8. Administration of Restricted Unit Award. The Award and any deferral of the payment, distribution or transfer of Common Stock shall be subject to such other rules and requirements as the Committee, in its sole discretion, may determine to be appropriate with respect to administration thereof and the restrictions made applicable to the Grantee and the Restricted Units during the Restricted Period. This Agreement and the rights and obligations of the parties involved, shall be subject to interpretation and construction by the Committee to the same extent and with the same effect as the Committee actions under pertinent provisions of the Plan. The Grantee shall take all actions and execute and deliver all documents as may from time to time be requested by the Committee in connection with such restrictions and in furtherance hereof. The Grantee agrees to pay to the Company any applicable federal, state, or local income, employment, social security, Medicare, or other withholding tax obligation arising in connection with the Award to the Grantee, which the Company shall determine; and the Company shall have the right, without the Grantee’s prior approval or direction, to satisfy such withholding tax by withholding all or any part of the Common Stock that would otherwise be transferred and delivered to the Grantee, with any shares of Common Stock so withheld to be valued at the Fair

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Market Value on the date of such withholding. The Grantee, with the consent of the Company, may satisfy such withholding tax by delivery and transfer to the Company of shares of Common Stock previously owned by the Grantee, with any shares so delivered and transferred to be valued at the Fair Market Value on the date of such delivery.

9. Adjustment Provisions. It is understood that, prior to the expiration of the Restricted Period, certain changes in capitalization of the Company may occur. It is, therefore, understood and agreed with respect to changes in capitalization that:

(a) If a stock dividend is declared on the Common Stock of the Company, which has not been granted as a dividend equivalent, there shall be added to the number of Restricted Units described in paragraph 1 of this Agreement, the number of Restricted Units which the Grantee would have been entitled to if the Grantee had been fully vested and the unrestricted owner of the number of Restricted Units then held under the Award granted, but not theretofore received without restriction; provided, however, that the additional Restricted Units shall be subject to all terms and provisions of this Agreement and in making such adjustments, no fractional Restricted Units shall be awarded, and the Grantee shall be entitled to receive only the number of full Restricted Units to which the Grantee may be entitled by reason of such adjustment at the adjusted grant price per share.

(b) In the event of an increase in the outstanding shares of Common Stock of the Company, effectuated for the purpose of acquiring properties or securities of another corporation or business enterprise, there shall be no increase in the number of shares of Restricted Units which are the subject matter of the Award evidenced by this Agreement as a result of such acquisition.

(c) In the event of an increase or decrease in the number of outstanding shares of Common Stock of the Company through recapitalization, reclassification, stock split-ups, consolidation of shares, changes in par value and the like, an appropriate adjustment shall be made in the number of Restricted Units described in paragraph 1 of this Agreement, by increasing or decreasing the number of Restricted Units, as may be required to enable the Grantee to acquire the same proportionate stockholdings as the grant of the Award would originally have provided. Provided, however, that any additional Restricted Units shall be subject to all terms and provisions of this Agreement and that in making such adjustments, no fractional Restricted Units shall be awarded, and the Grantee shall be entitled to receive only the number of full Restricted Units to which the Grantee may be entitled by reason of such adjustment.

(d) Except with respect to the time of payment of any compensation deferred under this Agreement, to the extent Restricted Units are still restricted and not vested in Grantee at the time of a Change in Control with respect to the Company, then pursuant to the provisions of the Plan, they shall become fully vested and completely unrestricted and free and clear of any restrictions stated herein at that time; provided, that if such Change in Control occurs less than six (6) months after the Grant Date of Restricted Units to the Grantee, then Restricted Units shall become fully vested and completely unrestricted and free and clear of any restrictions stated herein at the time of such Change in Control only if the Grantee agrees in writing, if requested by the Company in writing, to remain in the employ of the Company or Subsidiary of the Company

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at least through the date which is six (6) months after the Grant Date with substantially the same title, duties, authority, reporting relationships, and compensation as on the day immediately preceding the Change in Control. The provisions of this subparagraph (d) shall be applied in addition to, and shall not reduce, modify, or change any other obligation or right of the Grantee otherwise provided for in paragraph 3, above, concerning the Grantee’s continued employment with the Company or the termination thereof. If the Restricted Units become subject to this subparagraph (d), they shall become fully vested in the Grantee and nonforfeitable. Such Restricted Units are subject to the provisions of the Plan authorizing the Company, or a committee of its Board of Directors, to provide in advance or at the time of a Change in Control for cash to be paid in settlement of the Restricted Units, all subject to such terms and conditions as the Company or the Committee, in its sole discretion, may determine and impose. For purposes of this subparagraph (d), the term “Change in Control” shall have the same meaning as provided in the definition of that term stated in the Plan, including any amendments thereof.

10. Required Grantee Repayment/Reduction Provision. Notwithstanding anything in the Plan, the Award or this Agreement to the contrary, all or a portion of the Award made to the Grantee under this Agreement is subject to being called for repayment to the Company or reduced in any situation where the Board of Directors or a Committee thereof determines that fraud, negligence, or intentional misconduct by the Grantee was a contributing factor to the Company having to restate all or a portion of its financial statement(s). The Committee may determine whether the Company shall effect any such repayment or reduction: (i) by seeking repayment from the Grantee, (ii) by reducing (subject to applicable law and the terms and conditions of the Plan or any other applicable plan, program, or arrangement) the amount that would otherwise be awarded or payable to the Grantee under the Award, the Plan or any other compensatory plan, program, or arrangement maintained by the Company, (iii) by withholding payment of future increases in compensation (including the payment of any discretionary bonus amount) or grants of compensatory awards that would otherwise have been made in accordance with the Company’s otherwise applicable compensation practices, or (iv) by any combination of the foregoing. The determination regarding the Grantee’s conduct, and repayment or reduction under this provision shall be within the sole discretion of the Committee and shall be final and binding on the Grantee and the Company. The Grantee, in consideration of the grant of the Award, and by the Grantee’s execution of this Agreement, acknowledges the Grantee’s understanding of the agreement to this provision, and hereby agrees to make and allow an immediate and complete repayment or reduction in accordance with this provision in the event of a call for repayment or other action by the Company or Committee to effect its terms with respect to the Grantee, the Award and/or any other compensation described herein.

11. Stock Reserved. The Company shall at all times during the term of the Award reserve and keep available such number of shares of its Common Stock as will be sufficient to satisfy the Award issued and granted to Grantee and the terms stated in this Agreement.

12. Rights of Shareholder. Except as otherwise provided in this Agreement, the Grantee shall have no rights as a shareholder of the Company in respect of the Restricted Units or Common Stock for which the Award is granted; and the Grantee shall not be considered or treated as a record owner of shares of Common Stock with respect to the Restricted Units until the Common Stock is issued to Grantee and no longer subject to any of the restrictions pursuant to this Agreement, and Common Stock is actually issued and transferred to Grantee.

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13. Entire Agreement. This Agreement contains the entire terms of the Award, and may not be changed orally or other than by a written agreement issued and approved by the Company pursuant to the Plan. This Agreement supersedes any agreements or understandings that may have previously existed, and there are no other agreements or understandings, relating to its subject matter.

14. Successors and Assigns. The Award evidenced by this Agreement shall inure to the benefit of and be binding upon the heirs, legatees, legal representatives, successors, and assigns of the parties hereto.

The Grantee hereby acknowledges receipt of this Agreement, the Notice of Restricted Unit Award Agreement and a copy of the Plan, and accepts the Award under the terms and conditions stated in this Agreement, subject to all terms and provisions of the Plan, by signing this Agreement in duplicate originals, as of the date first stated above.

Date	«Officer_Name»
	Grantee

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EX-10.15

Exhibit 10.15

PERFORMANCE UNIT AWARD AGREEMENT

This Performance Unit Award Agreement is entered into as of the [    ] day of [            , 20    ], by and between ONE Gas, Inc., an Oklahoma Corporation, (the “Company”), and «Officer_Name» (the “Grantee”), an employee of the Company or Subsidiary thereof, pursuant to the terms of the ONE Gas, Inc. Equity Compensation Plan (the “Plan”).

1. Performance Unit Award. This Performance Unit Award Agreement and that certain Notice of Performance Unit Award and Agreement, dated [            , 20    ], a copy of which is attached hereto and incorporated herein by reference (collectively, the “Agreement”), constitute evidence of the grant of a Performance Unit Award (the “Award”) of «No of_Perf_Units» Performance Units (“Performance Units”) to the Grantee by the Company that shall entitle the Grantee to receive shares of the Company’s common stock (the “Common Stock”) or cash, all pursuant to the terms and conditions of this Agreement and the Plan. This Agreement, when executed by the Grantee, constitutes an agreement between the Company and the Grantee. The Performance Unit Award and Performance Units granted pursuant to this Agreement include the right of Grantee to receive dividend equivalents (“Dividend Equivalents”) upon the declaration and payment of dividends by the Company to holders of all common stock to the extent and as provided for in paragraph 5 of this Agreement.

2. Plan. Notwithstanding any provisions herein to the contrary, should there be any inconsistency between the provisions of this Agreement and the terms and provisions of the Award stated in the resolutions and records of the Board of Directors providing for the Award or provisions of the Plan, the provisions of such resolutions and records and of the Plan shall control. Except where expressly stated or clearly indicated otherwise by the terms of this Agreement, all terms, words and phrases used herein shall have the same meaning and effect as stated and as defined in the Plan.

3. Grantee’s Agreement Concerning Award and Employment. In consideration of the Company’s granting of the Award and entitlement to shares of Common Stock, as incentive compensation to Grantee pursuant to this Agreement, the Grantee, by acceptance thereof, and signing this Agreement evidencing its terms, agrees to such terms and to continue to contribute and perform service in the employ of the Company or Subsidiary thereof, at the direction, will and pleasure of the Company. Provided, however, neither the foregoing agreement of the Grantee in this paragraph 3, nor any other provision in this Agreement shall confer on the Grantee any right to continue in the employ of the Company (or Subsidiary thereof), or interfere in any way with the right of the Company (or Subsidiary) to terminate the Grantee’s employment at any time.

4. Registration of Stock; Grantee’s Representation With Respect To Acquiring for Investment. It is intended by the Company that the Plan and the shares of Common Stock covered by the Award issued and granted to the Grantee referred to in paragraph 1, above, are to be registered under the Securities Act of 1933, as amended, prior to the grant date; provided, that in the event such registration is for any reason not made effective for such shares, the Grantee agrees, for the Grantee, and for the Grantee’s permissible assignees, heirs and legal

representatives by inheritance or bequest, that all shares acquired pursuant to the grant will be acquired for investment and not with a view to, or for sale or tender in connection with the distribution of any part thereof, including any transfer or distribution of such shares by the Grantee pursuant to the grant and this Agreement or as otherwise allowed by the Plan.

5. Terms and Conditions of Award; Transfer of Stock to Grantee. The issue and grant of the Award to the Grantee stated in paragraph 1, above, shall be subject to the following terms and conditions:

(a) The right to ownership and transfer of the Performance Units granted to the Grantee shall be subject to the Agreement during the period beginning [            , 20    ], (the “Grant Date”), and ending on [            , 20    ], (which period is the “Performance Period”), as herein provided.

(b) The Grantee shall earn and become entitled to receive a percentage of the number of Performance Units granted under paragraph 1, above, and Additional Performance Units Credited under (f), below, at the expiration of the Performance Period as provided for in Exhibit A and Exhibit B, attached hereto, based upon the Company’s ranking for Total Stockholder Return in the ONE Gas Peer Group listed in Exhibit C attached hereto, all as determined by the Committee, in its sole discretion (the “Performance Goal”).

(c) Upon expiration of the Performance Period, the Grantee shall be entitled to receive one (1) share of Common Stock for each Performance Unit that becomes earned by and vested in the Grantee pursuant to the Award; provided, no fractional shares shall be issued and any amount attributable to a fractional share shall be paid to the Grantee in cash.

(d) All Common Stock the Grantee becomes entitled to receive pursuant to the Award and any other compensation payable to the Grantee under the Award shall be paid, distributed, transferred and issued by the Company to the Grantee at the expiration of the Performance Period, or as soon as practicable after the determination that the Grantee has earned and become entitled to Performance Units and to receive such Common Stock and cash, as determined by the Committee, and in no event later than the 15^th day of the third month after the end of the Performance Period, and the Grantee shall not be permitted, directly or indirectly, to designate the time of payment, distribution or transfer or the taxable year in which it is to be made. Provided, that if the Grantee elects pursuant to paragraph 6, below, to defer the receipt of all Performance Units, Common Stock and cash for each Performance Unit that becomes earned by and vested in the Grantee pursuant to the Award, the payment, distribution and transfer of such Performance Units, Common Stock and cash shall be deferred and thereafter paid, distributed and transferred by the Company to the Grantee at the specified time and in accordance with the method of payment, distribution and transfer that is elected by the Grantee in accordance with the election provisions set forth therein.

(e) The Grantee shall not be entitled to vote any shares of Common Stock of the Company and, except as provided in paragraph 5(f), the Grantee shall not have any right or interest as a holder of common stock by reason of the Performance Unit Award granted under this Agreement during the Performance Period, and prior to the actual transfer of common stock to the Grantee pursuant to the Agreement.

(f) During the Performance Period Grantee shall earn and Dividend Equivalents shall be credited to Grantee with respect to Performance Units in the form of additional Performance Units (“Additional Performance Units”) to Grantee with respect to the Performance Units as follows:

(i) On each date on which (a) the Performance Units and Additional Performance Units credited to Grantee hereunder have not become vested or have not been forfeited pursuant to the terms of this Agreement, and (b) the Company declares and pays a cash dividend to holders of Common Stock (each, a “Dividend Payment Date”), a number of Additional Performance Units will be credited to the Grantee in an amount (including fractional Additional Performance Units) determined by dividing (x) the aggregate cash dividends that would have been paid on the number of shares of Common Stock (including fractional shares of Common Stock) into which the Performance Units and Additional Performance Units theretofore granted and credited to Grantee under this Agreement on the Dividend Payment Date would be converted if vested on such date, by (y) the Fair Market Value of a share of Common Stock on such Dividend Payment Date.

(ii) The Additional Performance Units credited to Grantee pursuant to paragraph 5(f)(i) shall be added to and included in a cumulative aggregate amount of Additional Performance Units credited to the Grantee hereunder, which shall be recorded and accounted for as a separate identifiable amount to the credit of the Grantee (“Additional Performance Units Amount”).

(iii) Except as provided below with respect to the treatment of a fractional Additional Performance Unit or fractional share of Common Stock attributable to Grantee upon vesting hereunder, all the Additional Performance Units and the Additional Performance Units Amount so credited to Grantee shall be subject to the same terms and conditions as the Performance Units granted pursuant to paragraph 1 above, and such Additional Performance Units and Additional Performance Units Amount shall be forfeited in the event that the Performance Units granted pursuant to paragraph 1, above, are forfeited.

(iv) Unless otherwise expressly stated herein, any reference to Performance Units in this Agreement shall be deemed to similarly and in like manner refer and apply to Additional Performance Units credited to Grantee.

(v) The Grantee shall earn and become vested and entitled to the Additional Performance Units granted by this Award under this paragraph 5(f) at the end of the Performance Period. Upon expiration of the Performance Period, Grantee shall be entitled to receive, and the Company shall issue to Grantee one (1) share of Common Stock for each Additional Performance Unit that becomes earned by and vested in Grantee pursuant to the Award; provided, that the shares of Common Stock to be issued to and received by Grantee for Additional Performance Units, shall be only issued in whole shares of Common Stock, and any fractional share of Common Stock attributable to the Additional Performance Units credited to Grantee shall be paid to Grantee in an amount of cash equal to the Fair Market Value of a fractional share of Common Stock.

(g) The Common Stock or cash to which the Grantee becomes entitled shall be paid and transferred to the Grantee only upon the determination of the Performance Units earned by the Grantee at the end of the Performance Period. The payment and transfer of such Common Stock or cash to the Grantee shall be made as soon as reasonably practicable after the end of the Performance Period, as determined and directed by the Committee, in its sole discretion.

(h) The Performance Units or any Common Stock or cash to be paid or transferred to Grantee pursuant to the Award may not be sold, assigned, transferred, pledged, encumbered or otherwise disposed of by Grantee or any other person except as provided in the Agreement and the Plan until the end of the Performance Period and payment and transfer of Common Stock or cash pursuant to the Agreement and Plan.

(i) The Grantee shall become entitled to receive Performance Units earned, and shall become owner of the shares of Common Stock or cash paid and transferred to the Grantee pursuant to the Award free and clear of all terms, conditions and restrictions imposed by the Award if the Grantee’s employment by the Company does not terminate during the Performance Period; provided, that the Grantee shall become entitled to a prorated amount of Performance Units and the terms and conditions imposed by the Award shall partially cease to apply in certain events to the extent described in paragraph 7(d), below.

(j) If the Grantee’s employment with the Company (or Subsidiary thereof) terminates prior to the end of the Performance Period other than by reason of Retirement, Total Disability or death, the Grantee shall forfeit all of the Grantee’s right, title or interest in the Performance Units. Any such termination of employment of the Grantee described in the preceding sentence shall not be deemed to occur by reason of transfer of employment of the Grantee by or between the Company and any Subsidiary. Upon a forfeiture the Performance Units forfeited shall be cancelled for all purposes.

6. Deferral of Payment, Distribution and Transfer of Stock.

(a) The Grantee may irrevocably elect to defer the time of payment, distribution and transfer of Performance Units, Common Stock and cash that the Grantee becomes entitled to receive under this Agreement from the end of the Performance Period generally provided for in paragraph 5, above, to a specified time, by filing with the Committee, on or before the deferral election date (the “Election Date”) described in paragraph 6(b), below, a signed written irrevocable election (the “Election”) which shall be in the form substantially the same as attached hereto as Exhibit D, or as otherwise prescribed by the Committee.

(b) An Election to defer the payment, distribution and transfer of Performance Units, Common Stock and cash that the Grantee becomes entitled to receive under this Agreement and Award shall be filed by the Grantee with the Committee on or before the Election Date, which shall be [            , 20    ], the date that is six (6) months before the end of the Performance Period, provided that the Grantee performs services for the Company continuously from the later of the beginning of the Performance Period or the date the performance criteria are established through the date the Election is made under this paragraph 6(b), and provided, further, that in no event may the Grantee elect to defer the payment,

distribution and transfer of Performance Units, Common Stock or cash after such compensation has become readily ascertainable; and in this regard for purposes of this paragraph 6(b), if the amount of Performance Units, Common Stock and cash, or other compensation, as performance-based compensation, is a specified or calculable amount, then it shall be considered compensation that is readily ascertainable if and when the amount is first substantially certain to be paid, distributed and transferred to the Grantee. If the amount of Performance Units, Common Stock and cash, or other compensation, is performance-based compensation that is not a specified or calculable amount because, for example, the amount may vary based upon the level of performance, such compensation, or any portion of the compensation, shall be considered readily ascertainable when the amount is first both calculable and substantially certain to be paid. For this purpose, such performance-based compensation is to be bifurcated between the portion that is readily ascertainable and the amount that is not readily ascertainable, and, in general, any minimum amount that is both calculable and substantially certain to be paid shall be treated as readily ascertainable.

(c) A Grantee that makes an Election to defer payment, distribution and transfer of Performance Units, Common Stock and cash that the Grantee becomes entitled to receive under this Agreement and Award may irrevocably elect to have payment, distribution and transfer made to the Grantee at a Specified Time, that shall be either (i) the later of (A) the date of the Grantee’s separation from service with the Company, or (B) a specified calendar date, or (ii) the date of the Grantee’s separation from service with the Company; and may elect to have payment made in a specified form of payment that shall be either (i) a single lump sum payment, distribution and transfer, or (ii) a payment, distribution and transfer in two, three, four or five equal annual installments commencing at the Specified Time elected by the Grantee hereunder and thereafter on each anniversary thereof, until fully paid, transferred and distributed.

(d) The provisions of this Agreement providing for the deferral of payment, distribution, transfer or issuance of Performance Units, Common Stock or cash shall be applicable solely and exclusively to the Grantee and the Award referred to herein, and shall not apply to any other stock incentive or other grant, award or transfer provided for or made under the Plan.

(e) Notwithstanding anything otherwise provided under the Plan or in the Agreement, the following requirements shall apply to this Agreement and the Award, to all elections or subsequent elections made by the Grantee, and to all distributions and payments made to the Grantee pursuant to this Agreement:

(1) Any compensation for services performed by the Grantee during a taxable year may be deferred at the Grantee’s election or the Company’s election or determination only if the election to defer such compensation is made not later than the close of the preceding taxable year or such other time as provided in Treasury Regulations under Code section 409A, but in all events any deferral of the payment, distribution, transfer or issuance of Performance Units, Common Stock or cash pursuant to the Agreement may be made only by an election that is made on or before the Election Date.

(2) Any compensation deferred under the Plan shall not be distributed earlier than

(i) Separation from Service of the Grantee,

(ii) the date the Grantee becomes Disabled,

(iii) death of the Grantee,

(iv) a Specified Time (or pursuant to a Fixed Schedule) specified under the plan under which the compensation is deferred at the date of deferral of such compensation,

(v) a Change in Ownership or Control, or

(vi) the occurrence of an Unforeseeable Emergency.

(3) To the extent that a distribution is subject to Code Section 409A and Grantee becomes entitled to such distribution on account of a Separation from Service and is a Specified Employee on the date of the Separation from Service, no payment or distribution shall be made before the date which is six (6) months after the date of the Grantee’s Separation from Service, or, if earlier, the date of death of the Grantee.

(4) No acceleration of the time or schedule of any distribution or payment under the plan under which compensation is deferred shall be permitted or allowed, except to the extent provided in Treasury Regulations issued under Code section 409A.

(5) This Agreement shall not permit a subsequent election unless authorized and agreed upon in writing by the Company and Grantee, and if the Plan or this Agreement permits under any subsequent election by the Grantee a delay in a payment or a change in the form of payment of compensation deferred under this Agreement, such subsequent election shall not take effect until at least twelve (12) months after the date on which it is made. In the case of a subsequent election related to a payment to be made upon Separation from Service of the Grantee, at a Specified Time or pursuant to a Fixed Schedule, or upon a Change in Ownership or Control, the first payment with respect to which such subsequent election is made shall be deferred for a period of not less than five (5) years from the date such payment would otherwise have been made; and any such subsequent election related to a payment at a Specified Time or pursuant to a Fixed Schedule may not be made less than twelve (12) months prior to the date of the first scheduled payment to which it relates.

(6) For purposes of the Plan and this Agreement and the Award, the following terms and definitions shall apply with respect to deferral of compensation and the time of payment of any deferred compensation:

(i) “Change of Ownership or Control” means to the extent provided by Treasury Regulations issued under Code Section 409A, a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, which shall be if (i) a person acquires more than 50% of the Company’s stock;

(ii) a person acquires during a 12-month period at least 30% of the Company’s stock; (iii) a majority of the members of the Board of Directors are replaced during a 12-month period; or (iv) a person acquires during a 12-month period at least 40% of the gross fair market value of the Company’s assets.

(ii) “Disabled” means that an individual (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the individual’s employer.

(iii) “Fixed Schedule” means the distribution or payment of compensation deferred under this Agreement and Award in a fixed schedule of distributions or payments that are determined and fixed at the time the deferral of such compensation is first elected by the Grantee or the Company.

(iv) “Specified Employee” means a key employee (as defined in Code section 416(i) without regard to paragraph (5) thereof) of the Company.

(v) “Specified Time” means a specified date at which deferred compensation deferred by or for the Grantee pursuant to this Agreement and Award is required to be distributed or paid and which is specified at the time of the election of deferral of such deferred compensation.

(vi) “Unforeseeable Emergency” means a severe financial hardship to the participant resulting from an illness or accident of the participant, the participant’s spouse, or a dependent (as defined in Code section 152(a)) of the participant, loss of the participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the participant. As determined under Treasury Regulations under Code section 409A, the amounts distributed with respect to an emergency shall not exceed the amounts necessary to satisfy such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship).

7. Transferability of Performance Units; Termination of Employment.

(a) Except as provided in subparagraph (b) of this paragraph 7, below, the Award, the Grantee’s rights and obligations hereunder and the Performance Units granted hereunder shall not be transferable by the Grantee otherwise than by will or the laws of descent and distribution which apply to the Grantee’s estate.

(b) Notwithstanding the foregoing, the Grantee may transfer any part or all of the Grantee’s rights in and to the Performance Units to members of the Grantee’s immediate family, or to one or more trusts for the benefit of such immediate family members, or partnerships in which such immediate family members are the only partners if the Grantee does not receive any consideration for the transfer. In the event of any such transfer, Performance Units shall continue to be subject to the same terms and conditions otherwise applicable hereunder and under the Plan immediately prior to its transfer, except that this stock shall not be further transferable by the transferee inter vivos, except for transfer back to the original Grantee. For any such transfer to be effective, the Grantee must provide prior written notice thereof to the Committee, unless otherwise authorized and approved by the Committee, in its sole discretion; and the Grantee shall furnish to the Committee such information as it may request with respect to the transferee and the terms and conditions of any such transfer. For purposes of transfer of this grant under this subparagraph (b), “immediate family” shall mean the Grantee’s spouse, children and grandchildren.

(c) Notwithstanding any provision in this Agreement to the contrary, all rights and interest of the Grantee in the Performance Units shall become invalid and wholly terminated and forfeited upon the termination of the Grantee’s employment with the Company (or Subsidiary), during the Performance Period other than a termination by reason of Retirement, Total Disability or death of the Grantee.

(d) Notwithstanding the foregoing provisions, in the event of termination of the Grantee’s employment with the Company (or Subsidiary) during the Performance Period by reason of (i) the Retirement of the Grantee, (ii) the Total Disability of the Grantee, or (iii) the Grantee’s death while still employed by the Company (or Subsidiary), then an adjusted and prorated entitlement to Performance Units shall be allowed as provided in this paragraph 7(d). The Grantee shall become vested in and entitled to receive, in the event of any such Retirement or Total Disability, and the legatees, designated Beneficiary, or personal representatives or heirs of the Grantee shall be vested in and entitled to receive, in the event of the Grantee’s death, a prorated award of Performance Units earned in the Performance Period following such Retirement, Total Disability or death. The award shall be a prorated amount of Performance Units equal to the total of Performance Units earned at the end of the Performance Period for the Grantee, multiplied by a fraction of which the numerator shall be the number of full months which have elapsed under the Performance Period at the time of such termination of employment by reason of Retirement, Total Disability or death, and the denominator of which shall be the total number of months in the Performance Period. The Grantee, legatees, designated Beneficiary, or personal representatives or heirs of the Grantee, as the case may be, shall become entitled to receive such prorated award at the end of the Performance Period subject to and dependent solely upon, the attainment of the Performance Goal as provided herein.

(e) The Grantee may designate a Beneficiary to receive any rights of the Grantee which may become vested in the event of the death of the Grantee under procedures and in the form established by the Committee; and in the absence of such designation of a Beneficiary, any such rights shall be deemed to be transferred to the estate of the Grantee.

(f) For purposes of the Award and this Agreement, “Retirement” shall mean a voluntary termination of employment of the Grantee with the Company and/ or Subsidiary thereof by the Grantee if at the time of such termination of employment the Grantee has both completed five (5) years of service with the Company and/ or Subsidiary thereof and attained age fifty (50), and “voluntary termination” shall mean that the Grantee had an opportunity to continue employment with the Company and/ or Subsidiary thereof, but did not do so; and except as provide for in paragraph 6 with respect to deferred compensation payments, “Total Disability” shall mean that the Grantee is permanently and totally disabled and unable to engage in any substantial gainful activity by reason of a medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months, and has established such disability to the extent and in the manner and form as may be required under the provisions of Code Section 22(e) and regulations thereunder.

8. Administration of Performance Unit Award. The Award and any deferral of the payment, distribution or transfer of Common Stock shall be subject to such other rules and requirements as the Committee, in its sole discretion, may determine to be appropriate with respect to administration thereof and the terms and conditions made applicable to the Grantee and the Performance Units during the Performance Period. The Award, this Agreement, and the rights and obligations of the parties thereto shall be subject to interpretation and construction by the Committee to the same extent and with the same effect as the Committee actions under pertinent provisions of the Plan. The Grantee shall take all actions and execute and deliver all documents as may from time to time be requested by the Committee in connection with such restrictions and in furtherance hereof. The Grantee agrees to pay to the Company any applicable federal, state, or local income, employment, social security, Medicare, or other withholding tax obligation arising in connection with the Award to the Grantee, which the Company shall determine; and the Company shall have the right, without the Grantee’s prior approval or direction, to satisfy such withholding tax by withholding all or any part of the shares of Common Stock or cash that would otherwise be paid and transferred to the Grantee, with any shares of Common Stock so withheld to be valued at the Fair Market Value on the date of such withholding. The Grantee, with the consent of the Company, may satisfy such withholding tax by delivery and transfer to the Company of shares of Common Stock previously owned by the Grantee, with any shares so delivered and transferred to be valued at the Fair Market Value on the date of such delivery.

9. Adjustment Provisions. It is understood that, prior to the expiration of the Performance Period certain changes in capitalization of the Company may occur. It is, therefore, understood and agreed with respect to changes in capitalization that:

(a) If a stock dividend is declared on the Common Stock of the Company, which has not been granted as a dividend equivalent, there shall be added to the number of Performance Units provided for under the Award and stated in paragraph 1 of this Agreement, the number of Performance Units equal to the number of Performance Units which would have been granted to the Grantee had the Grantee been the fully vested and unrestricted owner of the number of Performance Units then provided for under the Award granted, but not theretofore received without restriction; provided, however, that the additional Performance Units shall be subject to all terms and provisions of this Agreement, and in making such adjustments, no

fractional units, shares, or scrip certificates in lieu thereof, shall be granted or issuable by the Company, and the Grantee shall be entitled to only the number of full Performance Units to which the Grantee may be entitled by reason of such adjustment at the adjusted grant.

(b) In the event of an increase in the outstanding shares of Common Stock of the Company, effectuated for the purpose of acquiring properties or securities of another Company or business enterprise, there shall be no increase in the number of Performance Units which are the subject matter of the Award under this Agreement as a result of such acquisition.

(c) In the event of an increase or decrease in the number of outstanding shares of Common Stock of the Company through recapitalization, reclassification, stock split-ups, consolidation of shares, changes in par value and the like, an appropriate adjustment shall be made in the number of Performance Units provided for under the Award and stated in Section 1 of this Agreement, by increasing or decreasing the number of Performance Units, as may be required to enable the Grantee to acquire the same proportionate stockholdings as the grant of the Award would originally have provided. Provided, however, that any additional Performance Units shall be subject to all terms and provisions of this Agreement and that in making such adjustments, no fractional Performance Units shall be awarded, and the Grantee shall be entitled to receive only the number of full Performance Units to which the Grantee may be entitled by reason of such adjustment.

(d) Except as otherwise provided for with respect to the payment of any deferred compensation in paragraph 6, above, to the extent Performance Units are still not vested in Grantee at the time of a Change in Control with respect to the Company, then pursuant to the provisions of the Plan, they shall become fully vested and completely free and clear of any conditions or restrictions stated herein at that time; provided, that if such Change in Control occurs less than six (6) months after the Grant Date to the Grantee, then Performance Units shall become fully vested and completely free and clear of any conditions or restrictions stated herein at the time of such Change in Control only if the Grantee agrees in writing, if requested by the Company in writing, to remain in the employ of the Company or Subsidiary at least through the date which is six (6) months after the Grant Date with substantially the same title, duties, authority, reporting relationships, and compensation as on the day immediately preceding the Change in Control. The provisions of this subparagraph (d) shall be applied in addition to, and shall not reduce, modify, or change any other obligation or right of the Grantee otherwise provided for in paragraph 3, above, concerning the Grantee’s continued employment with the Company or the termination thereof. If the Performance Units become subject to this subparagraph (d), they shall become fully vested in the Grantee and nonforfeitable. The Performance Units are subject to the provisions of the Plan authorizing the Company, or a committee of its Board of Directors, to provide in advance or at the time of a Change in Control for cash to be paid in actual settlement of the shares of Common Stock for earned Performance Units, all subject to such terms and conditions as the Company or the Committee, in its sole discretion, may determine and impose. For purposes of this subparagraph (d), the term “Change in Control” shall have the same meaning as provided in the definition of that term stated in the Plan, including any amendments thereof.

10. Required Grantee Repayment/Reduction Provision. Notwithstanding anything in the Plan, the Award or this Agreement to the contrary, all or a portion of the Award made to the Grantee under this Agreement is subject to being called for repayment to the Company or reduced in any situation where the Board of Directors or a Committee thereof determines that fraud, negligence, or intentional misconduct by the Grantee was a contributing factor to the Company having to restate all or a portion of its financial statement(s). The Committee may determine whether the Company shall effect any such repayment or reduction: (i) by seeking repayment from the Grantee, (ii) by reducing (subject to applicable law and the terms and conditions of the Plan or any other applicable plan, program, or arrangement) the amount that would otherwise be awarded or payable to the Grantee under the Award, the Plan or any other compensatory plan, program, or arrangement maintained by the Company, (iii) by withholding payment of future increases in compensation (including the payment of any discretionary bonus amount) or grants of compensatory awards that would otherwise have been made in accordance with the Company’s otherwise applicable compensation practices, or (iv) by any combination of the foregoing. The determination regarding the Grantee’s conduct, and repayment or reduction under this provision shall be within the sole discretion of the Committee and shall be final and binding on the Grantee and the Company. The Grantee, in consideration of the grant of the Award, and by the Grantee’s execution of this Agreement, acknowledges the Grantee’s understanding of the agreement to this provision, and hereby agrees to make and allow an immediate and complete repayment or reduction in accordance with this provision in the event of a call for repayment or other action by the Company or Committee to effect its terms with respect to the Grantee, the Award and/or any other compensation described herein.

11. Stock Reserved. The Company shall at all times during the term of the Award reserve and keep available such number of shares of its Common Stock as will be sufficient to satisfy the Award issued and granted to Grantee and the requirements thereof as evidenced by this Agreement.

12. Rights of Shareholder. Except as otherwise provided in the Award and this Agreement, the Grantee shall have no rights as a shareholder of the Company in respect of the Performance Units or Common Stock for which the Award is granted; and the Grantee shall not be considered or treated as a record owner of shares with respect to the Common Stock until the Performance Units are fully vested and no longer subject to any of the conditions, performance requirements, or restrictions imposed pursuant to this Agreement, and Common Stock is actually issued and transferred to the Grantee.

13. Entire Agreement. This Agreement contains the entire terms of the Award, and may not be changed orally or other than by a written agreement issued and approved by the Company pursuant to the Plan. This Agreement supersedes any agreements or understandings that may previously have existed, and there are no other agreements or understandings, relating to its subject matter.

14. Successors and Assigns. The Award shall inure to the benefit of and be binding upon the heirs, legatees, legal representatives, successors, and assigns of the parties thereto.

The Grantee hereby acknowledges receipt of this Agreement, the Notice of Performance Unit Award and a copy of the Plan, and accepts the Award under the terms and conditions stated in this Agreement, subject to all terms and provisions of the Plan, by signing this Agreement in duplicate originals, as of the date first above written.

Date	«Officer_Name»
	Grantee

EX-10.16

Exhibit 10.16

ONE GAS, INC.

EMPLOYEE STOCK PURCHASE PLAN

1. Establishment and Purpose

By unanimous consent, the Board of Directors of the Company approved the adoption of this Plan effective as of the Effective Date, subject to approval by ONEOK, Inc., the Company’s sole shareholder, prior to the Effective Date. The purpose of this Plan is to provide eligible employees the opportunity to purchase Common Stock at a discount on a basis that qualifies for the tax treatment prescribed by Section 423 of the Code.

2. Definitions

The following terms, when used in the Plan, shall have the following meanings:

(a) Base Compensation means, with respect to any offering period: (i) in the case of an employee normally paid an hourly rate, the employee’s hourly rate at the inception of the offering period multiplied by 2,080, (ii) in the case of an employee normally paid at a weekly rate, the employee’s weekly rate at the inception of the offering period multiplied by 52, (iii) in the case of an employee normally paid at a bi-weekly rate, the employee’s bi-weekly rate at the inception of the offering period multiplied by 26, (iv) in the case of an employee normally paid at a monthly rate, the employee’s monthly rate at the inception of the offering period multiplied by 12; and (v) in the case of an employee normally paid at an annual rate, the employee’s annual rate at the inception of the offering period. Base compensation shall be determined by reference to the applicable rate before any deductions pursuant to a salary reduction agreement under any plan qualified under Section 401(k) of the Code or any cafeteria plan under Code Section 125 and shall exclude any bonuses, commissions, overtime pay, fringe benefits, stock options and other special compensation payable to an employee.

(b) Board or Board of Directors means the Board of Directors of the Company, as constituted from time to time.

(c) Code means the Internal Revenue Code of 1986, as amended from time to time. References to the Code or to a particular section of the Code shall include references to any related Treasury Regulations and rulings and to successor provisions.

(d) Committee means the committee appointed by the Board of Directors to administer the Plan pursuant to the provisions of Section 3(a) below.

(e) Common Stock means common stock, par value $0.01, of the Company.

(f) Company means ONE Gas, Inc., an Oklahoma corporation, its successors and assigns.

(g) Effective Date means the effective date of the distribution of all of the outstanding shares of Company Common Stock to the holders of shares of ONEOK, Inc. common stock in connection with the separation of the ONEOK, Inc. local natural gas distribution business into an independent, publicly traded entity to be known as One Gas, Inc.

(h) Exchange Act means the Securities Exchange Act of 1934, as amended from time to time.

(i) Fair Market Value on a particular date means the average of the high and low sale prices of the Common Stock in consolidated trading on the date in question as reported by The Wall Street Journal or another reputable source designated by the Committee; provided that if there were no sales on such date reported as provided above, the respective prices on the most recent prior day for which a sale was so reported. If the foregoing method of determining fair market value should be inconsistent with Section 423 of the Code, “Fair Market Value” shall be determined by the Committee in a manner consistent with such section of the Code and shall mean the value as so determined.

(j) General Counsel means the General Counsel of the Company serving from time to time.

(k) Plan means this ONE Gas, Inc. Employee Stock Purchase Plan set forth in these pages, as amended from time to time.

(l) SEC Rule 16b-3 means Rule 16b-3 of the Securities and Exchange Commission promulgated under the Exchange Act, as such rule or any successor rule may be in effect from time to time.

(m) Section 16 Person means a person subject to Section 16(b) of the Exchange Act with respect to transactions involving equity securities of the Company.

(n) Subsidiary means a subsidiary as defined in Section 424(f) of the Code, including a corporation which becomes such a subsidiary in the future.

3. Administration

(a) The Plan shall be administered by a committee of the Board consisting of two or more directors appointed from time to time by the Board. No person shall be appointed to or shall serve as a member of such committee unless at the time of such appointment and service he or she shall be a Non-Employee Director, as defined in SEC Rule 16b-3. The Committee may delegate discretionary authority for day-to-day administration of the Plan to other entities or persons, including the Company and its employees, pursuant to a duly adopted resolution or a memorandum of action signed by all members of the Committee or approved via electronic transmission. All actions taken by any such delegate shall have the same legal effect and shall be entitled to the same deference as if taken by the Committee itself.

(b) Subject to the provisions of the Plan, the powers of the Committee shall include having the authority, in its discretion, to:

(i) define, prescribe, amend and rescind rules, regulations, procedures, terms and conditions relating to the Plan; and

(ii) make all other determinations necessary or advisable for the administration of the Plan, including but not limited to interpreting the Plan, correcting defects, reconciling inconsistencies and resolving ambiguities.

(iii) approve any transaction involving a grant, award or other transaction from the Company to a Section 16 Person (other than a Discretionary Transaction, as defined in SEC Rule 16b-3), so as to exempt such transaction under SEC Rule 16b-3; provided, that any transaction under the Plan involving a Section 16

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Person also may be approved by the Board of Directors, or may be approved or ratified by the stockholders of the Company, in the manner that exempts such transaction under SEC Rule 16b-3.

(c) The interpretation by the Committee of the terms and provisions of the Plan, and its administration of the Plan, and all action taken by the Committee, shall be final, binding and conclusive on the Company, its stockholders, Subsidiaries, all participants and employees, and upon their respective successors and assigns, and upon all other persons claiming under or through any of them.

(d) Members of the Board and members of the Committee acting under this Plan shall be fully protected in relying in good faith upon the advice of counsel and shall incur no liability except for gross or willful misconduct in the performance of their duties.

4. Stock Subject to the Plan

(a) Subject to paragraph (c) below, the aggregate number of shares of Common Stock which may be sold under the Plan is 700,000.

(b) If the number of shares of Common Stock that participating employees become entitled to purchase is greater than the number of shares of Common Stock that are offered in a particular offering or that remain available under the Plan, the available shares of Common Stock shall be allocated by the Committee among such participating employees in such manner as it deems fair and equitable.

(c) In the event of any change in the Common Stock, through recapitalization, merger, consolidation, stock dividend or split, combination or exchange of shares, spinoff or otherwise, the Committee may make such equitable adjustments in the Plan and the then outstanding offerings as it deems necessary and appropriate including, but not limited to, changing the number of shares of Common Stock reserved under the Plan, and the price of the current offering; provided that any such adjustments shall be consistent with Sections 423 and 424 of the Code.

(d) Shares of Common Stock which are to be delivered under the Plan may be obtained by the Company from its treasury, by purchases on the open market or from private sources, or by issuing authorized but unissued shares of its Common Stock. Shares of authorized but unissued Common Stock may not be delivered under the Plan if the purchase price thereof is less than the par value (if any) of the Common Stock at the time. The Committee may (but need not) provide at any time or from time to time (including without limitation upon or in contemplation of a change in control) for a number of shares of Common Stock equal in number to the number of shares then subject to options under this Plan, or expected to be subject to options under this Plan in the then pending offering(s), to be issued or transferred to, or acquired by, a trust (including but not limited to a grantor trust) for the purpose of satisfying the Company’s obligations under such options, and, unless prohibited by applicable law, such shares held in trust shall be considered authorized and issued shares with full dividend and voting rights, notwithstanding that the options to which such shares relate might not be exercisable at the time. No fractional shares of Common Stock shall be issued or sold under the Plan.

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5. Eligibility

All employees of the Company and any Subsidiaries designated by the Committee from time to time will be eligible to participate in the Plan, in accordance with and subject to such rules and regulations as the Committee may prescribe; provided, however, that (a) such rules shall neither permit nor deny participation in the Plan contrary to the requirements of the Code (including but not limited to Section 423(b)(3), (4) and (8) thereof), (b) no employee shall be eligible to participate in the Plan if his or her customary employment is 20 hours or less per week or for not more than 5 months in any calendar year, unless the Committee determines otherwise on a uniform and non-discriminatory basis, (c) no employee may be granted an option under the Plan if such employee, immediately after the option is granted, owns stock possessing 5% or more of the total combined voting power or value of all classes of stock of his or her employer corporation or any parent or Subsidiary corporation (within the meaning of Section 423(b)(3) of the Code). For purposes of the preceding sentence, the rules of Section 424(d) of the Code shall apply in determining the stock ownership of an employee, and stock which the employee may purchase under outstanding options (whether or not such options qualify for the special tax treatment afforded by Code Section 421(a)) shall be treated as stock owned by the employee; and (d) all participating employees shall have the same rights and privileges except as otherwise permitted by Section 423(b)(5) of the Code.

6. Offerings; Participation.

The Company may make offerings of up to 27 months’ duration each, to eligible employees to purchase Common Stock under the Plan, until all shares authorized to be delivered under the Plan have been exhausted or until the Plan is sooner terminated by the Board. Subject to the preceding sentence, the duration and commencement date of any offerings shall be determined by the Committee in its sole discretion; provided that, unless the Committee determines otherwise, a new offering shall commence on the first day of the Company’s first payroll period coinciding with or next following each January 1 and July 1 and shall extend through and include the payroll period immediately preceding the payroll period in which the next offering commences. Notwithstanding the foregoing, the first offering shall commence on the first day of the Company’s first payroll period coinciding with or next following the Effective Date of the Plan and shall extend through and include the payroll period immediately preceding the payroll period in which the next offering commences. Subject to such rules, procedures and forms as the Committee may prescribe, an eligible employee may participate in an offering at such time(s) as the Committee may permit by authorizing a payroll deduction for such purpose of at least 1 percent and up to a maximum of 10 percent of his or her Base Compensation earned during each payroll period or such lesser amount as the Committee may prescribe. An eligible employee’s initial payroll deduction election will remain in effect for successive offering periods unless modified or terminated in accordance with Article 7 below. The Committee may at any time suspend or accelerate the completion of an offering if required by law or deemed by the Committee to be in the best interests of the Company, including in the event of a change in ownership or control of the Company or any Subsidiary. The Company’s obligation to sell and deliver Common Stock under this Plan shall be subject to the approval of any governmental authority whose approval the General Counsel determines is necessary or advisable to obtain in connection with the authorization, issuance or sale of such Common Stock.

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7. Payroll Deductions

(a) The Company will maintain payroll deduction accounts on its books for all participating employees. All employee contributions shall be credited to such accounts. Employee contributions credited to the payroll deduction accounts of participating employees need not be segregated from other corporate funds and may be used for any corporate purpose.

(b) At such times as the Committee may permit and subject to such rules, procedures and forms as the Committee may prescribe, an employee may withdraw from participation in a particular offering period and the balance of his or her payroll deduction account for that offering period shall be refunded to the participant. Any such withdrawal shall be irrevocable.

(c) No employee shall make any elective contribution or employee contribution to the Plan (within the meaning of Treasury Regulation Section 1.401(k)-1(d)(2)(iv)(B)(4)) during the balance of the current offering period after the employee’s receipt of a hardship distribution from a plan of the Company or a related party within the provisions of Code Section 414(b), (c), (m) or (o) containing a cash or deferred arrangement under Section 401(k) of the Code. An employee will not be eligible to participate until the offering period that follows after their six-month hardship withdrawal suspension period has ended. The foregoing sentence shall not apply if and to the extent the General Counsel determines it is not necessary to qualify any such plan as a cash or deferred arrangement under Section 401(k) of the Code.

(d) Any payroll deductions not applied to the purchase of shares of Common Stock by reason of the limitations in the Plan on the maximum number of shares that may be purchased shall be promptly refunded. In accordance with rules and procedures as the Committee may prescribe, any balance in any employee’s payroll deduction account at the end of an offering period not applied to the purchase of full shares of Common Stock will be carried forward into the employee’s payroll deduction account for the following offering period either in the form of partial shares of Common Stock or cash. In no event will the balance carried forward be equal to or greater than the purchase price of one share of Common Stock as determined under Section 8(c) below. Upon termination of the Plan, all amounts in the accounts of participating employees shall be carried forward into their payroll deduction accounts under a successor plan, if any, or refunded to them, as the Committee may decide.

(e) Unless otherwise determined by the Committee, in the event of the termination of a participating employee’s employment for any reason, his or her participation in any offering under the Plan shall cease, no further amounts shall be deducted pursuant to the Plan and the balance in the employee’s account shall be paid to the employee, or, in the event of the employee’s death, to the employee’s beneficiary under the Company’s basic group life insurance program.

(f) No interest shall accrue on an employee’s payroll deductions unless otherwise required by applicable law. In addition, no interest shall be paid on any monies distributed under this Plan.

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8. Purchase; Limitations

(a) Within the limitations of Section 8(d) below, each employee participating in any offering under the Plan will be granted an option, upon the effective date of such offering, for as many shares, or if required by the Committee, full shares, of Common Stock as the amount of his or her payroll deduction account (including any contributions made by means other than payroll deductions in a prior offering period that remain in cash, if any, in the employee’s payroll deduction account pursuant to Section 7(d) above) at the end of the offering can purchase.

(b) As of the last day of the offering period, the payroll deduction account of each participating employee shall be totaled. Subject to the provisions of Section 7(b) above and 8(d) below, the employee shall be deemed to have exercised an option to purchase the largest number of shares, or if required by the Committee, full shares of Common Stock at the price determined under Section 8(c) below that his or her payroll deduction account will permit; such employee’s account will be charged for the amount of the purchase and for all purposes under the Plan the employee will be deemed to have acquired the shares on that date; and either a stock certificate representing such shares will be issued to him or her, or the Company’s registrar will make an entry on its books and records evidencing that such shares have been duly issued or transferred as of that date, as the Committee may direct.

(c) Unless the Committee determines before the effective date of an offering that a higher price that complies with Section 423 of the Code shall apply, the purchase price of the shares of Common Stock which are to be sold under the offering shall be the lesser of (i) an amount equal to 85 percent of the Fair Market Value of the Common Stock at the time such option is granted, or (ii) an amount equal to 85 percent of the Fair Market Value of the Common Stock at the time such option is exercised.

(d) In addition to any other limitations set forth in the Plan, (i) no employee may purchase in any offering period more than the number of shares of Common Stock determined by dividing the employee’s annual Base Compensation as of the first day of the offering period, or $25,000, whichever is less, by the Fair Market Value of a share of Common Stock at such day, and (ii) no employee may be granted an option under the Plan which permits his or her rights to purchase stock under the Plan, and any other stock purchase plan of his or her employer corporation and its parent and subsidiary corporations that is qualified under Section 423 of the Code, to accrue at a rate which exceeds $25,000 of the Fair Market Value of such stock (determined at the time such option is granted) for each calendar year in which the option is outstanding at any time. The Committee may further limit the amount of Common Stock which may be purchased by any employee during an offering period in accordance with Section 423(b)(5) of the Code.

9. No Transfer

(a) No option, right or benefit under the Plan (including any derivative security within the meaning of paragraph (a)(2) of SEC Rule 16b-3) may be transferred by a participating employee, whether by will, the laws of descent and distribution, or otherwise, and all options, rights and benefits under the Plan may be exercised during the participating employee’s lifetime only by such employee.

(b) Book entry accounts and certificates for shares of Common Stock purchased under the Plan may be maintained or registered, as the case may be, only in the name of the participating employee or, if such employee so indicates on his or her payroll deduction authorization form, in his or her name jointly with a member of his or her family, with right of survivorship. An employee who is a resident of a jurisdiction which does not recognize such a joint tenancy may have book entry accounts maintained and certificates registered in the employee’s name as tenant in common with a member of the employee’s family, without right of survivorship.

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10. Duration of Plan

The Plan shall remain in effect until all shares authorized to be issued or transferred hereunder have been exhausted or until the Plan is sooner terminated by the Board of Directors, and may continue in effect thereafter with respect to any options outstanding at the time of such termination if the Board of Directors so provides.

11. Amendment and Termination of the Plan

The Plan may be amended by the Board of Directors, without shareholder approval, at any time and in any respect, unless shareholder approval of the amendment in question is required under Oklahoma law, the Code (including without limitation Code Section 423 and Treasury Regulation Section 1.423-2(c)(4) thereunder), any exemption from Section 16 of the Exchange Act (including without limitation SEC Rule 16b-3) for which the Company intends Section 16 Persons to qualify, any national securities exchange or system on which the Common Stock is then listed or reported, by any regulatory body having jurisdiction with respect to the Plan, or under any other applicable laws, rules or regulations. The Plan provisions that determine the amount, price and timing of option grants to Section 16 Persons may not be amended more than once every six months, other than to comport with changes in the Code, the Employee Retirement Income Security Act of 1974, or the rules thereunder, unless the General Counsel determines that such restriction on amendments is not necessary to secure or maintain any exemption from Section 16 of the Exchange Act for which the Company intends Section 16 Persons to qualify. The Plan may also be terminated at any time by the Board of Directors.

12. General Provisions

(a) Nothing contained in this Plan shall be deemed to confer upon any person any right to continue as an employee of or to be associated in any other way with the Company for any period of time or at any particular rate of compensation.

(b) At the time an option is exercised, or at the time some or all of the Common Stock that is issued under the Plan is disposed of, the Company may withhold from any amount payable to an eligible employee, or require such employee to remit to the Company (or make other arrangements satisfactory to the Company, in its discretion, regarding payment to the Company of), any amount necessary for the Company to satisfy any federal, state or local taxes required by law to be withheld. Whenever payments are to be made in cash under the Plan, such payments shall be made net of an amount sufficient to satisfy any federal, state, local tax or withholding obligations with respect to such payments.

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(c) No person shall have any rights as a stockholder of the Company with respect to any shares optioned under the Plan until such shares are issued or transferred to him or her.

(d) All expenses of adopting and administering the Plan shall be borne by the Company, and none of such expenses shall be charged to any participant.

(e) The laws of the State of Oklahoma shall govern all matters relating to the Plan except to the extent such law is superseded by the laws of the United States.

(f) The Plan and each offering under the Plan is intended to qualify as an employee stock purchase plan within the meaning of Section 423 of the Code. Transactions under the Plan by or with respect to Section 16 Persons are also intended to qualify for exemption under SEC Rule 16b-3, unless the Committee specifically determines otherwise. Every provision of the Plan shall be administered, interpreted and construed to carry out those intentions, and any provision that cannot be so administered, interpreted and construed shall to that extent be disregarded.

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EX-21.1

Exhibit 21.1

LIST OF SUBSIDIARIES

1.   One Gas Properties, L.L.C., an Oklahoma limited liability company

EX-99.1

Exhibit 99.1

,

Dear ONEOK Shareholder:

I am pleased to inform you that on                     ,     , the board of directors of ONEOK, Inc. (“ONEOK”) approved the distribution of all of the shares of common stock of ONE Gas, Inc. (“ONE Gas”), a wholly owned subsidiary of ONEOK, to ONEOK shareholders. Prior to the distribution, ONEOK will transfer its natural gas distribution business to ONE Gas.

The distribution of shares is to be made pursuant to a plan initially approved by the board of directors of ONEOK on July 24, 2013, to separate ONEOK’s natural gas distribution business from the other ONEOK businesses. Upon the distribution of shares, ONEOK shareholders will own 100 percent of the common stock of ONE Gas. ONEOK’s board of directors believes that creating a separate natural gas distribution company will serve a number of corporate business purposes and increase value to, and is in the best interests of, our shareholders.

The distribution of ONE Gas common stock will occur on                     ,     , by way of a pro rata dividend to ONEOK shareholders of record on                     ,     , the record date of the distribution. Each ONEOK shareholder will be entitled to receive                 share(s) of ONE Gas common stock for each share of ONEOK common stock held by such shareholder at the close of business on the record date. ONE Gas common stock will be issued in book-entry form only, which means that no physical stock certificates will be issued. No fractional shares of ONE Gas common stock will be issued. If you would otherwise have been entitled to a fractional share of ONE Gas common stock in the distribution, you will receive the cash value of such fractional share instead. Shareholder approval of the distribution is not required, and you are not required to take any action to receive your ONE Gas common stock. The distribution is intended to be tax-free for U.S. federal income tax purposes to ONEOK shareholders, except for cash received in lieu of any fractional share interest.

Following the distribution, you will own shares in both ONEOK and ONE Gas. The number of ONEOK shares you own will not change as a result of this distribution. ONEOK’s common stock will continue to trade on the New York Stock Exchange under the symbol “OKE.” We intend to apply to list ONE Gas’ common stock on the New York Stock Exchange under the ticker symbol “OGS.”

The Information Statement, which is being mailed to all holders of ONEOK common stock on the record date for the distribution, describes the distribution in detail and contains important information about ONE Gas, its business, financial condition and operations. We urge you to read the Information Statement carefully. You are not required to take any specific action.

We want to thank you for your continued support of ONEOK, and we look forward to your future support of ONE Gas.

Sincerely,

Dear Future ONE Gas, Inc. Shareholder:

It is our pleasure to welcome you as a future shareholder of our company, ONE Gas, Inc. (“ONE Gas”). We are excited about our future as one of the largest natural gas utilities in the United States.

We are a natural gas local distribution company with a strong operational track record and the necessary scale to operate as a publicly-traded, 100 percent regulated, natural gas utility company. We serve more than 2 million customers in Oklahoma, Kansas and Texas. We will continue to deliver safe, reliable and efficient service to our customers in an environmentally responsible manner. Additionally, we believe we can be more effective by focusing on tailored growth strategies and the capital needs of our company, and thus realize more shareholder value as a stand-alone company than we could operating as a segment of ONEOK, Inc.

We intend to apply to have our common stock listed on the New York Stock Exchange under the ticker symbol “OGS.”

We invite you to learn more about ONE Gas by reviewing the enclosed Information Statement and urge you to read it carefully. We look forward to our future and to your support as a holder of ONE Gas common stock.

Sincerely,

Preliminary Information Statement

(Subject to Completion, Dated December 23, 2013)

Information Statement

Distribution

by

ONEOK, Inc.

to ONEOK’s Shareholders of

Common Stock of

ONE Gas, Inc.

This Information Statement is being furnished in connection with the distribution by ONEOK, Inc., an Oklahoma corporation (“ONEOK”), to its shareholders of all of the shares of common stock, par value $0.01 per share, of ONE Gas, Inc., an Oklahoma corporation (“ONE Gas”). Currently, we are a wholly owned subsidiary of ONEOK that has been formed to hold ONEOK’s natural gas distribution business. To implement the distribution, ONEOK will distribute all of the shares of our common stock on a pro rata basis to the holders of ONEOK common stock as of                 ,     , the record date for the distribution. Each of you, as a holder of ONEOK common stock, will receive                 share(s) of ONE Gas common stock for each share of ONEOK common stock that you held at the close of business on the record date for the distribution. The distribution will be made on                 ,     . Immediately after the distribution is completed, ONE Gas will be a separate, publicly-traded company.

No vote of ONEOK shareholders is required in connection with this distribution. We are not asking you for a proxy, and you are requested not to send us a proxy.

No consideration is to be paid by ONEOK shareholders in connection with this distribution. ONEOK shareholders will not be required to pay any consideration for the shares of our common stock that they receive in the distribution, and they will not be required to surrender or exchange shares of their ONEOK common stock or take any other action in connection with the distribution. The number of shares of ONEOK common stock owned by you will not change as a result of the distribution.

All of the outstanding shares of our common stock are owned currently by ONEOK. Accordingly, there currently is no public trading market for our common stock. We intend to file an application to list our common stock on the New York Stock Exchange (“NYSE”) under the ticker symbol “OGS.” Assuming that our common stock is approved for listing on the NYSE, we anticipate that a limited market, commonly known as a “when-issued” trading market, for our common stock will develop on or shortly before the record date for the distribution and will continue up to and through the distribution date, and we anticipate that “regular-way” trading of our common stock will begin on the first trading day following the distribution date.

In reviewing this Information Statement, you should carefully consider the matters described in the section entitled “Risk Factors” beginning on page 27 of this Information Statement.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of any of the securities of ONE Gas, or determined whether this Information Statement is truthful or complete. Any representation to the contrary is a criminal offense.

This Information Statement does not constitute an offer to sell or the solicitation of an offer to buy any securities.

The date of this Information Statement is                     ,         .

This Information Statement was first mailed to ONEOK shareholders on or about                 ,          .

TABLE OF CONTENTS

Summary	1
Risk Factors	27
Forward-Looking Statements	44
The Separation	46
Dividend Policy	56
Capitalization	57
Selected Historical and Pro Forma Financial Data	58
Management’s Discussion and Analysis of Financial Condition and Results of Operations	60
Quantitative and Qualitative Disclosures about Market Risk	78
Industry Overview	79
Business	81
Environmental and Safety Matters	91
Management	93
Executive Compensation	98
Compensation Discussion and Analysis	98
Security Ownership of Certain Beneficial Owners and Management	132
Certain Relationships and Related-Party Transactions	133
Description of ONE Gas Capital Stock	141
Description of Material Indebtedness	148
Where You Can Find More Information	150
Index to Financial Statements	F-1

TRADEMARKS, TRADE NAMES AND SERVICE MARKS

Certain trademarks, trade names and logos of third parties may appear in this Information Statement. The display of such third parties’ trademarks, trade names and logos is for informational purposes only, and is not intended for marketing or promotional purposes or as an endorsement of their business or of any of their products or services.

MARKET AND INDUSTRY DATA AND FORECASTS

This Information Statement includes industry data and forecasts that we have prepared based, in part, upon industry data and forecasts obtained from industry publications, surveys and publicly-available websites.

SUMMARY

The following is a summary of some of the information relating to our company, our separation from ONEOK and the distribution of our common stock by ONEOK to its shareholders contained in this Information Statement. It does not contain all of the details concerning us or the separation, including information that may be important to you. We urge you to read the entire document carefully, including the risk factors, our pro forma financial information and our historical financial statements and the notes to those financial statements.

Except as otherwise indicated or unless the context otherwise requires, the information included in this Information Statement assumes the completion of the separation of ONE Gas from ONEOK, Inc. and the related distribution of our common stock. Except as otherwise indicated or unless the context otherwise requires, “ONE Gas,” “we,” “us,” “our” and “our company” refer to ONE Gas, Inc. and its subsidiaries following the separation from ONEOK. “ONEOK” refers to ONEOK, Inc. and its subsidiaries. “ONE Gas Predecessor” or our “Predecessor” refers to our predecessor for accounting purposes that consists of the business attributable to ONEOK’s natural gas distribution segment that will be transferred to us in connection with the separation. “ONEOK Partners” refers to ONEOK Partners, L.P. and its subsidiaries. “Our business” refers to our business as will be conducted by ONE Gas following the separation.

ONE Gas

We are currently a wholly owned subsidiary of ONEOK. Following the separation, we will be an independent, publicly traded, 100 percent regulated natural gas distribution utility. ONEOK will not retain any ownership interest in our company. Our assets and business consist primarily of those that ONEOK attributes to its Natural Gas Distribution segment and that are reported in the Natural Gas Distribution segment in its financial statements.

We are a natural gas local distribution company and the successor to the company founded in 1906 as Oklahoma Natural Gas Company. We provide natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively. We are the largest natural gas distributor in Oklahoma and Kansas and the third largest natural gas distributor in Texas in terms of customers, providing service as a regulated public utility to wholesale and retail customers. Our largest natural gas distribution markets in terms of customers are Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita and Topeka, Kansas; and Austin and El Paso, Texas. We serve residential, commercial, industrial and transportation customers in all three states. In addition, we serve wholesale and public authority customers.

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The following map reflects the areas in which we operate in Oklahoma, Kansas and Texas:

Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service distribute natural gas as public utilities to approximately 87 percent, 70 percent and 14 percent of the natural gas distribution customers in Oklahoma, Kansas and Texas, respectively.

We are subject to the regulations and oversight of the state and local regulatory agencies of the territories in which we operate. Rates charged for natural gas distribution services are established by the OCC for Oklahoma Natural Gas and by the KCC for Kansas Gas Service. Texas Gas Service is subject to regulatory oversight by the various municipalities that it serves, which have primary jurisdiction in their respective areas. Rates in unincorporated areas of Texas and all appellate matters are subject to regulatory oversight by the RCC. The allowed rates are intended to be sufficient to cover the costs of conducting business and to provide a fair and reasonable return on capital invested. We believe that we must maintain a competitive advantage compared with alternative energy sources in order to retain our customers and, accordingly, we focus on providing safe, reliable and efficient service while controlling costs.

The below table sets forth key statistics of our service territories as of and for the nine months ended September 30, 2013:

Key Service Territory Data	Oklahoma			Kansas			Texas			Total
Customers:		847,092			634,325			634,388			2,115,805
Residential		770,369			578,544			596,718			1,945,631
Commercial and industrial		71,375			50,199			33,817			155,391
Wholesale and public authority		—			18			2,743			2,761
Transportation		5,348			5,564			1,110			12,022
Miles of pipelines (approximate)		19,000			14,000			10,000			43,000
Average retail price of electricity / Kilowatt / Hour(1)		9.62	¢		11.64	¢		11.31	¢		NA
Natural gas price equivalent / Dth(1)	$	28.19		$	34.11		$	33.15			NA
ONE Gas delivered average cost of natural gas / Dth(2)	$	11.01		$	10.51		$	9.83			NA
Natural gas advantage ratio(3)		2.6	x		3.3	x		3.4	x		NA

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(1) Source: United States Energy Information Agency, www.eia.gov, for the eight-month period ended August 31, 2013.

(2) Represents the average delivered cost of natural gas to a residential customer, including the cost of natural gas supplied, fixed customer charge, delivery charges and charges for riders, surcharges and other regulatory mechanisms associated with the services we provide, for the nine-month period ended September 30, 2013.

(3) Calculated as the ratio of the natural gas price equivalent per dekatherm of the average retail price of electricity per kilowatt hour to the ONE Gas delivered average cost of natural gas per dekatherm.

For the nine months ended September 30, 2013, we generated net margin of approximately $589.4 million, operating income of approximately $155.3 million, and net income of approximately $68.9 million. For the nine months ended September 30, 2012, we generated net margin of approximately $545.8 million, operating income of approximately $137.5 million, and net income of approximately $57.9 million. For the year ended December 31, 2012, we generated net margin of approximately $756.4 million, operating income of approximately $215.7 million, and net income of approximately $96.5 million. For the year ended December 31, 2011, we generated net margin of approximately $751.8 million, operating income of approximately $199.7 million, and net income of approximately $86.8 million.

In connection with the separation, we are entering into certain agreements with ONEOK, including the Separation and Distribution Agreement, a Transition Services Agreement, a Tax Matters Agreement, an Employee Matters Agreement and, if needed, one or more Management Agreements, under which we and ONEOK will agree to, among other things, effect the separation. These agreements will also govern the relationship between us and ONEOK subsequent to the completion of the separation and provide for the allocation among us and ONEOK of the assets, liabilities and obligations (including employee benefits and tax-related assets and liabilities) relating to the natural gas distribution business attributable to periods prior to, at and after the separation. For additional information about our arrangements with ONEOK, please see the section entitled “Certain Relationships and Related-Party Transactions—Agreements with ONEOK.”

We describe in this Information Statement the business to be transferred to us by ONEOK in connection with the separation as if it were our business for all historical periods described. However, we are a newly formed entity that will not independently conduct any operations before the separation. References in this document to our historical assets, liabilities, business or activities generally refer to the historical assets, liabilities, business or activities of the transferred business as it was conducted as part of ONEOK before the separation. The financial statements for ONE Gas Predecessor in this Information Statement have been derived from the natural gas distribution business contained within ONEOK’s historical financial records as if we had been a separate company for all periods presented. The assets and liabilities in the financial statements included in this Information Statement have been reflected on a historical basis, immediately prior to the separation. The financial statements also include expense allocations for certain corporate functions historically performed by ONEOK, including allocations of general corporate expenses related to executive oversight, accounting, treasury, tax, legal and information technology, among others. We believe our assumptions underlying the financial statements, including the assumptions regarding the allocation of general corporate expense from ONEOK, are reasonable. However, the financial statements may not include all of the actual expenses that would have been incurred and may not reflect our results of operations, financial position and cash flows had we been a stand-alone company during the periods presented.

Our company was incorporated in Oklahoma on August 30, 2013. The address of our principal executive office is                  and our main telephone number at that address is                 . We also maintain a website at                 , but the information contained or referenced in our website is not part of this Information Statement.

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Our Competitive Strengths

We have a number of competitive strengths that we believe will contribute to the sustainability of our business and add value to all of our stakeholders, including our shareholders, customers and employees:

100 Percent Regulated Utility Focus

We will be a 100 percent regulated natural gas distribution company that serves three contiguous states—Oklahoma, Kansas and Texas. Unlike many other companies with natural gas distribution businesses, we do not have any operations outside of our natural gas utility business. We believe that we will be better positioned for long-term success following the separation because we will be able to focus our efforts on our core natural gas utility business, allowing us to deploy capital optimally and to promote steady and stable rate base and earnings-per-share growth, while delivering a competitive dividend to our shareholders.

Significant Scale

We serve approximately 2.1 million customers across three contiguous states—Oklahoma, Kansas and Texas. By customer count, we would be the third largest publicly traded natural gas LDC in the country as of December 31, 2012, according to our review of publicly available information. Our service territory includes several major cities including Tulsa, Oklahoma City, Topeka, Kansas City, Wichita, Austin and El Paso. The contiguous nature and proximity of our service territories allow for favorable economies of scale, while the size of our service territories offers significant regulatory and geographic diversity, with no single jurisdiction comprising more than 40 percent of our customers.

High-Quality Service Territories

Our service territories provide significant economic benefits to our business. According to the United States Department of Labor, the average unemployment rate of Oklahoma, Kansas and Texas through August 2013 is estimated to be 5.9 percent, or 20 percent below the national average. Moreover, the three states containing our service territories are expected to experience a higher aggregate population growth rate than the national average through 2015 according to projections from the United States Census Bureau and state government agencies. We believe that the economic and demographic characteristics of our service territories position us to continue to deliver customer and rate base growth through investments focused on maintaining the safety and reliability of our existing infrastructure, as well as connecting new customers to our system.

Stability of Our Cash Flows

We believe that the combination of the significant residential component of our customer base, the fixed-charge component of our sales margin and our regulatory rate mechanisms in place result in a stable cash flow profile. Residential users accounted for 92 percent of our customers and 83 percent of our natural gas sales net margin in 2012. Approximately 70 percent of our natural gas sales net margin in 2012 was derived from fixed charges to our customers. Accordingly, our business historically has generated stable and predictable net margin. Additionally, we have several regulatory rate mechanisms in place to reduce the volatility of our cash flows and to allow for reduced lag in earning a return on our capital expenditures. For further information, see “Business—Regulatory Overview.”

Proximity to Natural Gas Resources

Our natural gas commodity costs are comprised of three primary components: the cost of natural gas, transportation fees and storage fees. The territories that we serve are located in close proximity to significant natural gas reserves in Oklahoma, Kansas and Texas. We believe that the location of our service territories and

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related distribution assets relative to these reserves provides us with diverse supply sources and a distinct and sustainable competitive advantage relative to other energy sources by reducing the total energy cost for four of the main energy consumers in our residential customers’ homes—furnaces, water heaters, cooktops and clothes dryers.

Strong Credit Metrics

We expect to have credit ratings that are higher than ONEOK’s current credit ratings. We believe that stronger credit ratings will provide a significant advantage to our business. By maintaining a conservative financial profile and stable revenue base, we believe that we will be able to maintain an investment-grade credit rating higher than ONEOK’s existing ratings, which we believe will provide us access to diverse sources of capital at more favorable rates in order to finance our infrastructure investments.

Experienced Management Team

Our management team has significant and deep experience in the natural gas utility and midstream industries, including operating, acquiring, constructing, developing and integrating LDC assets, and they understand the service requirements of our customers. Our management team focuses on maintaining open and on-going communications with our regulators, which we believe is beneficial in maintaining a constructive regulatory environment.

Our Strategy

Our primary business objective is to grow our business responsibly, enabling us to deliver an attractive total return to our shareholders over time and to maintain our financial stability. We intend to accomplish this objective by executing on the strategies listed below:

Focus on Safety of Employees, Contractors, the Public and the Environment

We are committed to pursuing a zero-incident safety culture with a focus on mitigating risk and eliminating incidents that may harm our employees, contractors, the public or the environment. Comparing 2009 with the year-to-date period ended August 31, 2013, we have experienced steady improvement across a number of key safety metrics, including a 55 percent reduction in our recordable incident rate and a 40 percent reduction in our preventable vehicle incident rate. In addition, the majority of our capital spending is focused on the safety, reliability and efficiency of our system.

Increase Our Achieved ROE

We continually seek to improve our achieved ROE through improved operational performance and regulatory mechanisms. For 2012, our achieved ROE was 8.3 percent across all of our service territories. The weighted-average regulatory ROE that we were allowed to earn during that same period was 10.0 percent. The difference between our achieved and allowed ROE is related primarily to regulatory lag. We make investments that increase our rate base and we incur increases in our costs that are above the amounts reflected in the rates we charge for our service. Additionally, we are not allowed recovery of certain costs we incur. The rates we charge are set in regulatory proceedings generally referred to as rate cases. The delay between the time such investments are made or increases in costs are incurred and the time that our rates are adjusted to reflect these investments and costs is referred to as regulatory lag. We have several mechanisms in place that reduce regulatory lag by allowing for adjustments to our rates between rate cases. In Oklahoma, we are under a performance-based rates mechanism, which provides for streamlined annual rate reviews between rate cases to ensure our achieved ROE remains within the established band of 10 percent to 11 percent. In Kansas, we are

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allowed to recover a return on and return of qualifying capital investments between rates cases under the GSRS. In Texas, each of our jurisdictions allows us, on an annual basis, to (1) request cost-of-service adjustments to recover and earn a return on investments in rate base and certain changes in operating expenses or (2) recover a return on and return of capital investments between rates cases under the GRIP. In addition, Texas Gas Service is allowed to accrue a rate of return, taxes and depreciation expense on safety-related plant replacements from the time the replacements are in service until the plant is reflected in base rates. For further information, please see the section entitled “Business—Regulatory Overview.” In addition, we have several initiatives underway to improve our operational performance. These initiatives include implementing technology that will result in increased productivity and lower operating expenses and restructuring our contractual agreements with third party contractors to reduce expenses.

Focus on Our Credit Metrics and Our Balanced Approach to Capital Management

We believe that maintaining an investment-grade credit rating is prudent for our business as we seek to access the capital markets to finance capital investments. We intend to maintain strong credit metrics while we pursue a balanced approach to capital investment and a return of capital to shareholders via a dividend that we believe will be competitive with our peer group.

Advocate Constructive Relationships with Key Stakeholders

We plan to continue our constructive relationships with all our key stakeholders, including our employees, customers, investors and regulators. Our strategy includes seeking outcomes in future rate cases that provide a fair return on our infrastructure investments, while also meeting the needs of our customers through low-cost, efficient and reliable service. In addition, we will continue our efforts to deliver on our strong record of safety and environmental compliance. We also seek to promote a diverse and inclusive workforce and to reward employees through a market-based compensation system.

Identify and Pursue Growth Opportunities

Our growth opportunities are primarily driven by capital investments related to safety and reliability enhancements to our existing system and the economic and population growth in our service territories. As a result of our commitment to enhance the integrity, reliability and safety of our existing infrastructure, we are making significant investments in our existing system, which leads to further growth of our rate base. In addition, as our service territories continue to experience economic growth, we expect to grow our rate base through capital investments in new service lines and main line extensions that we believe will allow us to meet the energy needs of new customers. As a result of overall trends in the natural gas and energy industries, we believe that the competitiveness of natural gas is increasing relative to other energy alternatives, which is creating new market opportunities for natural gas as an energy source within our existing service territories. Finally, we will continue to evaluate strategic acquisition opportunities based on our disciplined financial and operating approach, while weighing these alternatives against future investment opportunities with respect to our existing rate base.

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The Separation

On July 24, 2013, the board of directors of ONEOK unanimously authorized the management of ONEOK to pursue a plan to separate its natural gas distribution business from the rest of ONEOK, which we refer to as “the separation” in this Information Statement. The separation will occur through the following steps:

• the “reorganization,” which is the corporate reorganization in which ONEOK will transfer all of the assets and liabilities primarily related to its natural gas distribution business to ONE Gas. These assets and liabilities include accounts receivable and payable, natural gas in storage, regulatory assets and liabilities, pipeline and other natural gas distribution facilities, customer deposits, employee-related assets and liabilities including amounts attributable to pension and other postretirement benefits, tax-related assets and liabilities and other assets and liabilities primarily associated with providing natural gas distribution service in Oklahoma, Kansas and Texas. Cash and certain corporate assets, such as office space in the corporate headquarters and certain IT hardware and software, will not be transferred to ONE Gas; however, the Transition Services Agreement between ONEOK and ONE Gas will provide ONE Gas with access to such corporate assets as necessary to operate its business for a period of time to enable ONE Gas to obtain the applicable corporate assets.

As part of the reorganization, (1) immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all of the amounts outstanding on our short-term note payable to and long-term line of credit with ONEOK, (2) ONE Gas expects to receive approximately $1.19 billion of cash from the issuance of debt securities, and (3) ONE Gas expects to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, followed by

• the “distribution,” which is the distribution to ONEOK’s shareholders of all of our shares of common stock.

Following the distribution, ONEOK shareholders will directly own all of the shares of our common stock.

ONEOK believes that the separation of the natural gas distribution business will unlock the value of ONEOK’s assets and will provide ONEOK and ONE Gas with more tailored growth strategies, more efficient capital allocation, improved investor understanding and better shareholder alignment of the separate businesses. ONEOK believes that the separation of the natural gas distribution business will improve both companies’ strategic, operational and financial flexibility and performance.

Before the distribution, we will enter into the Separation and Distribution Agreement and several other agreements with ONEOK to effect the reorganization and the distribution and provide a framework for our relationships with ONEOK after the distribution. These agreements will govern the relationships among us and ONEOK subsequent to the completion of the distribution and provide for the allocation among us and ONEOK of the assets, liabilities and obligations (including employee benefits and tax-related assets and liabilities) relating to the natural gas distribution business attributable to periods prior to, at and after the distribution. For more information on the Separation and Distribution Agreement and related agreements, see the section entitled “Certain Relationships and Related-Party Transactions.”

In connection with the separation, we expect that we will receive approximately $1.19 billion of cash from the issuance of debt securities, and we expect to make a cash payment of approximately $1.13 billion to ONEOK from the expected proceeds of these debt securities, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures. The amount to be paid to ONEOK was determined

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after consideration of several factors, including the resulting capital structures, anticipated credit ratings and existing levels of debt at both ONEOK and ONE Gas. Our capital structure was designed to obtain investment grade credit ratings that are higher than the current credit ratings of ONEOK and similar to those of our natural gas utility peers and to provide us with the financial flexibility to maintain our current level of operations and to continue to invest in our natural gas distribution system. The amount to be paid to ONEOK is expected to allow ONEOK to reduce its existing debt and obtain credit ratings similar to or higher than its general partner peers. The tax basis of the net assets to be transferred to ONE Gas was also considered because any amount distributed to ONEOK in excess of such tax basis would generally be subject to income tax unless complex financing arrangements were entered into.

ONEOK has informed us that the approximately $1.13 billion of cash proceeds it receives from us, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, will be used to repay outstanding ONEOK debt and/or repurchase ONEOK shares or pay dividends with respect to ONEOK shares, in each case within 18 months following the distribution. The amount to be paid to ONEOK and the amount, type and term of the debt securities we will issue have not yet been determined but will be determined prior to the separation. A number of factors could affect this final determination and the amount of debt securities ultimately issued could be different from the amount disclosed in this Information Statement.

Additionally, we have entered into a $700 million revolving credit facility and intend to enter into a commercial paper program to support our working capital and general corporate needs and normal course of business requirements after the separation. For more information on our planned financing arrangements, please see the sections entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Description of Material Indebtedness.”

Reasons for the Separation

The ONEOK board of directors regularly reviews ONEOK’s various businesses to ensure that ONEOK’s resources are being put to use in a manner that is in the best interests of ONEOK and its shareholders. ONEOK believes that the separation of the natural gas distribution business is the best way to unlock the value of ONEOK’s businesses in both the short and long term and provides ONEOK and us with certain opportunities and benefits that would not otherwise be available to ONEOK and us. ONEOK’s board of directors considered various factors and potential benefits in approving the separation transaction, including its belief that the separation will:

• enhance strategic, financial and operating flexibility, and the growth potential of both entities;

• increase transparency of each company;

• better align the businesses with each company’s relevant peer groups;

• attract more focused equity investors to each company;

• sharpen each company’s focus on its distinct strategic goals;

• resolve internal competition for capital among the businesses that is inherent in the existing structure; and

• enhance dividends and shareholder returns.

Neither we nor ONEOK can assure you that, following the distribution, any of these benefits will be realized to the extent anticipated or at all. For more information regarding the reasons for the separation, please see the section entitled “The Separation—Reasons for the Separation.”

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Summary of Risk Factors

An investment in our common stock involves risks associated with our business, regulatory and legal matters. The following summary list of risk factors is not exhaustive. Please read carefully the risks relating to these and other matters described in the sections entitled “Risk Factors” beginning on page 27 and “Forward-Looking Statements” beginning on page 44.

Risks Relating to Our Business

• Unfavorable economic and market conditions could affect adversely our earnings;

• Increases in the wholesale price of natural gas could reduce our earnings, increase our working capital requirements and impact adversely our customer base;

• Regulatory actions could impact our ability to earn a reasonable rate of return on our invested capital and to recover fully our operating costs;

• Our risk-management policies and procedures may not be effective, and employees may violate our risk-management policies;

• We are subject to comprehensive energy regulation by governmental agencies, and the recovery of our costs is dependent on regulatory action;

• Our business is subject to competition that could affect negatively our results of operations;

• Our business activities are concentrated in three states;

• The availability of adequate natural gas pipeline transportation capacity and natural gas supply may decrease and impair our ability to meet customers’ natural gas requirements;

• A downgrade in our credit ratings could affect negatively our cost of and ability to access capital;

• We are subject to new and existing laws and regulations that may require significant expenditures or significant increases in operating costs or result in significant fines or penalties for noncompliance;

• We are subject to strict regulations at many of our facilities regarding employee safety, and failure to comply with these regulations could affect adversely our financial results;

• We are subject to environmental regulations, which could affect adversely our operations or financial results;

• We are subject to pipeline safety and system integrity laws and regulations that may require significant expenditures, significant increases in operating costs or, in the case of non-compliance, substantial fines;

• Climate change, carbon neutral or energy-efficiency legislation or regulations could increase our operating costs or restrict our market opportunities, negatively affecting our growth, cash flows and results of operations;

• We are subject to physical and financial risks associated with climate change;

• Demand for natural gas is highly weather sensitive and seasonal, and weather conditions may cause our earnings to vary from year to year;

• We may not be able to complete necessary or desirable pipeline expansion or infrastructure development projects, which may delay or prevent us from serving our customers or expanding our business;

• We may pursue acquisitions, divestitures and other strategic transactions, the success of which may impact negatively our results of operations, cash flows and financial condition;

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• An impairment of goodwill and long-lived assets could reduce our earnings;

• We may be unable to access capital or our cost of capital may increase significantly;

• Changes in federal and state fiscal, tax and monetary policy could significantly increase our costs or decrease our cash flows;

• Federal, state and local jurisdictions may challenge our tax return positions;

• As a result of cross-default provisions in our borrowing arrangements, we may be unable to satisfy all of our outstanding obligations in the event of a default on our part;

• The cost of providing pension and postretirement health care benefits to eligible employees and qualified retirees is subject to changes in pension fund values and changing demographics and may increase. In addition, the passage of the Patient Protection and Affordable Care Act in 2010 could increase the cost of health care benefits for our employees. Further, the costs to us of providing such benefits and related funding requirements are subject to the continued and timely recovery of such costs through our rates;

• Our business is subject to operational hazards and unforeseen interruptions that could affect materially and adversely our business and for which we may not be insured adequately;

• A failure in our operational systems or cyber security attacks on any of our facilities, or those of third parties, may affect adversely our financial results;

• Our business could be affected adversely by strikes or work stoppages by our unionized employees;

• A shortage of skilled labor may make it difficult for us to maintain labor productivity and competitive costs, which could affect negatively operations and cash flows. Further, we may be unable to attract and retain professional and technical employees, which could adversely impact our earnings; and

• Changes in accounting standards may adversely impact our financial condition and results of operations.

Risks Relating to the Separation

• We may be unable to achieve some or all of the benefits that we expect to achieve from our separation from ONEOK;

• We are being separated from ONEOK, our parent company, and, therefore, we have no operating history as a separate, publicly traded company;

• We may be unable to make, on a timely basis, the changes necessary to operate as a separate, publicly-traded company, and we may experience increased costs after the separation or as a result of the distribution;

• We will be responsible for certain contingent and other liabilities related to the existing natural gas distribution business of ONEOK, as well as a portion of any contingent corporate liabilities of ONEOK that do not relate to either the natural gas distribution business or ONEOK’s remaining businesses;

• Third parties may seek to hold us responsible for liabilities of ONEOK that we did not assume in our agreements;

• Our prior and continuing relationship with ONEOK exposes us to risks attributable to businesses of ONEOK;

• Our financing arrangements will subject us to various restrictions that could limit our operating flexibility;

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• Some of our debt, including borrowings under our revolving credit facility, could be based on variable rates of interest, which could result in higher interest expenses in the event of an increase in interest rates;

• The ownership by our executive officers and some of our directors of shares of common stock or equity awards of ONEOK may create, or may create the appearance of, conflicts of interest;

• If the distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction for U.S. federal income tax purposes under Sections 355, 368(a)(1)(D) and other related provisions of the Code, then ONEOK and/or its shareholders could incur significant U.S. federal income tax liabilities, and we could incur significant indemnity obligations; and

• To preserve the tax-free treatment to ONEOK and/or its shareholders of the distribution and certain related transactions, we may not be able to engage in certain transactions.

Risks Relating to our Common Stock

• There is no existing market for our common stock, and a trading market that will provide you with adequate liquidity may not develop for our common stock. In addition, once our common stock begins trading, the market price of our shares may fluctuate widely;

• Substantial sales of common stock may occur in connection with the separation, which could cause our stock price to decline;

• Provisions in our certificate of incorporation, our bylaws, Oklahoma law and certain of the agreements into which we will enter as part of the distribution may prevent or delay an acquisition of our company, which could decrease the trading price of our common stock; and

• Our ability to pay dividends on our common stock will depend on our ability to generate sufficient positive earnings and cash flows.

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Questions and Answers about ONE Gas and the Separation

Why am I receiving this document? ONEOK is delivering this document to you because ONEOK’s records show that you were a holder of ONEOK common stock on the record date for the distribution of all of our shares of common stock. As such, you are entitled to receive                  share(s) of our common stock for each share of ONEOK common stock that you held on the record date at                     . No action is required for you to participate in the distribution. The distribution will take place immediately following the separation.

How will the separation of ONE Gas work? The separation will be accomplished through the following steps:

• the “reorganization,” which is the corporate reorganization in which ONEOK will transfer all of the assets and liabilities primarily related to its natural gas distribution business to ONE Gas. These assets and liabilities include accounts receivable and payable, natural gas in storage, regulatory assets and liabilities, pipeline and other natural gas distribution facilities, customer deposits, employee-related assets and liabilities including amounts attributable to pension and other postretirement benefits, tax-related assets and liabilities and other assets and liabilities primarily associated with providing natural gas distribution service in Oklahoma, Kansas and Texas. Cash and certain corporate assets, such as office space in the corporate headquarters and certain IT hardware and software, will not be transferred to ONE Gas; however, the Transition Services Agreement between ONEOK and ONE Gas will provide ONE Gas with access to such corporate assets as necessary to operate its business for a period of time to enable ONE Gas to obtain the applicable corporate assets.

As part of the reorganization, (1) immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all of the amounts outstanding on our short-term note payable to and long-term line of credit with ONEOK, (2) ONE Gas expects to receive approximately $1.19 billion of cash from the issuance of debt securities, and (3) ONE Gas expects to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, followed by

• the “distribution,” which is the distribution to ONEOK’s shareholders of all of our shares of common stock.

Why is the separation of ONE Gas structured as a distribution? ONEOK believes that a distribution of all of the shares of our common stock to the ONEOK shareholders is a tax efficient way to separate its natural gas distribution business from the rest of its businesses in a manner that is expected to allow us to achieve our corporate business purpose while creating long-term value for ONEOK shareholders.

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When will the distribution occur? We expect that ONEOK will distribute all of the shares of our common stock on or before             ,     , to holders of record of ONEOK common stock at the close of business on or before             ,     , the record date.

What do shareholders need to do to participate in the distribution? Nothing, but we urge you to read this entire Information Statement carefully because it contains important information about the separation and our company. Shareholders who hold ONEOK common stock as of the record date will not be required to take any action to receive our common stock in the distribution. No shareholder approval of the distribution is required or sought. We are not asking you for a proxy, and you are requested not to send us a proxy. You will not be required to make any payment or to surrender or exchange your shares of ONEOK common stock or take any other action to receive your shares of our common stock.

If you own ONEOK common stock as of the close of business on the record date, ONEOK, with the assistance of Wells Fargo Bank, N.A., the distribution agent, will electronically issue shares of our common stock to you or to your brokerage firm on your behalf by way of direct registration in book-entry form. Wells Fargo Bank, N.A. will mail you a book-entry account statement that reflects your shares of our common stock, or your bank or brokerage firm will credit your account for the shares.

Following the distribution, shareholders whose shares are held in book-entry form may request that their shares of our common stock held in book-entry form be transferred to a brokerage or other account at any time, without charge.

Will I receive physical certificates representing shares of ONE Gas common stock following the distribution? No. Following the distribution, neither ONEOK nor we will be issuing physical certificates representing shares of ONE Gas common stock. Instead, ONEOK, with the assistance of Wells Fargo Bank, N.A., the distribution agent, will electronically issue shares of our common stock to you or to your bank or brokerage firm on your behalf by way of direct registration in book-entry form. Wells Fargo Bank, N.A. will mail you a book-entry account statement that reflects your shares of our common stock, or your bank or brokerage firm will credit your account for the shares. A benefit of issuing stock electronically in book-entry form is that there will be none of the physical handling and safekeeping responsibilities that are inherent in owning physical stock certificates.

What if I hold shares of ONEOK common stock in ONEOK’s Direct Stock Purchase and Dividend Reinvestment Plan, Thrift Plan for Employees of ONEOK, Inc. and Subsidiaries, Profit-Sharing Plan, Employee Stock Purchase Plan or the Employee Stock Award Program? If you hold shares of ONEOK common stock in ONEOK’s Direct Stock Purchase and Dividend Reinvestment Plan, Employee Stock Purchase Plan or the Employee Stock Award Program, the shares of our common stock you will receive in the distribution will be deposited to your shareholder account at Wells Fargo Shareowner Services in book-entry form.

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For employees who hold shares of ONEOK’s common stock in ONEOK’s Thrift Plan for Employees of ONEOK, Inc. and Subsidiaries or the Profit-Sharing Plan, the shares of our common stock such employees are entitled to receive in the distribution will be distributed to their account under each of those plans.

Can ONEOK decide to cancel the distribution of the common stock even if all the conditions have been met? Yes. The distribution is subject to the satisfaction or waiver of certain conditions, including receipt of certain regulatory approvals. See the section entitled “The Separation—Conditions to the Distribution.” Until the distribution date, ONEOK has the right to terminate the distribution, even if all of the conditions are satisfied, if at any time ONEOK’s board of directors determines that the distribution is not in the best interests of ONEOK and its shareholders or that market conditions are such that it is not advisable to separate the natural gas distribution business from ONEOK and its other businesses.

Does ONE Gas plan to pay regular dividends? Yes. We expect to establish a dividend payout ratio target that is competitive with our natural gas utility peers. The declaration and payment of dividends by us in the future will be subject to the sole discretion of our board of directors and will depend upon many factors, including our financial condition, earnings, capital requirements, covenants associated with certain of our debt obligations, which may include maintaining certain debt to capital ratios, legal requirements, regulatory constraints and other factors deemed relevant by our board of directors.

Will ONE Gas incur any debt in the separation? In connection with the separation, we expect that we will receive approximately $1.19 billion of cash from the issuance of debt securities, and we expect to make a cash payment of approximately $1.13 billion to ONEOK from the expected proceeds of these debt securities, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures.

The amount to be paid to ONEOK and the amount, type and term of the debt securities we will issue have not yet been determined but will be determined prior to the separation. A number of factors could affect this final determination, and the amount of debt securities ultimately issued could be different from the amount disclosed in this Information Statement.

Additionally, we have entered into a $700 million revolving credit facility and intend to enter into a commercial paper program to support our working capital and general corporate needs and normal course of business requirements after the separation. For more information on our planned financing arrangements, please see the sections entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Description of Material Indebtedness.”

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ONEOK has informed us that the approximately $1.13 billion of cash proceeds it receives from us, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, will be used to repay outstanding ONEOK debt and/or repurchase ONEOK shares or pay dividends with respect to ONEOK shares, in each case within 18 months following the distribution.

What are the anticipated separation costs? Prior to the separation, ONEOK expects to incur separation costs for professional services, including financial advisors, legal, accounting, information technology, human resources and other business consultants. ONEOK will not allocate these separation costs to us.

Subsequent to the separation, we will incur additional expenses as a result of being a stand-alone publicly traded company. Under the terms of the Separation and Distribution Agreement, we will be responsible for all costs and expenses that we incur as a stand-alone company after the distribution.

What are the U.S. federal income tax consequences of the distribution? ONEOK has received the IRS Ruling to the effect that the distribution, together with certain related transactions, will qualify as tax-free to ONEOK, us and the ONEOK shareholders under Sections 355, 368(a)(1)(D) and other related provisions of the Code. It is a condition to the distribution that such IRS Ruling shall not have been withdrawn, invalidated or modified in an adverse manner. The distribution is also conditioned on the receipt by ONEOK of the opinion of Skadden, tax counsel to ONEOK, which opinion will rely on the continued validity of the IRS Ruling, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling. ONEOK expects to receive the opinion of Skadden on or prior to the distribution date. The board of directors of ONEOK reserves the right to waive these, or any other, conditions to the distribution.

A holder of ONEOK stock generally will recognize capital gain or loss with respect to cash received in lieu of fractional shares of our common stock.

Please see the sections entitled “Risk Factors—Risks Relating to the Separation—If the distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction for U.S. federal income tax purposes under Sections 355, 368(a)(1)(D) and other related provisions of the Code, then ONEOK and/or its shareholders could incur significant U.S. federal income tax liabilities, and we could incur significant indemnity obligations” and “The Separation—Certain U.S. Federal Income Tax Consequences of the Distribution” for more information regarding the IRS Ruling, the tax opinion and the potential tax consequences of the distribution.

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Holders of ONEOK common stock should consult their tax advisors as to the particular tax consequences of the distribution to them.

What will ONE Gas’s relationship be with ONEOK following the distribution? Before the distribution, we will enter into the Separation and Distribution Agreement and several other agreements with ONEOK to effect the separation and provide a framework for our relationships with ONEOK after the distribution. These agreements will govern the relationship among us and ONEOK subsequent to the completion of the distribution, and provide for the allocation among us and ONEOK of the assets, liabilities and obligations (including employee benefits and tax-related assets and liabilities) relating to the natural gas distribution business attributable to periods prior to, at and after the distribution. We cannot assure you that these agreements will be on terms as favorable to us as agreements with unaffiliated third parties might be. After the distribution, ONEOK will not own any of our stock. For additional information regarding the separation agreements please see the sections entitled “Risk Factors—Risks Relating to the Separation” and “Certain Relationships and Related-Party Transactions” included elsewhere in this Information Statement.

What if I want to sell my ONEOK common stock or my ONE Gas common stock? You should consult with your financial advisor, such as your stockbroker, bank or tax advisor. Neither ONEOK nor ONE Gas makes any recommendations on the purchase, retention or sale of shares of ONEOK common stock or the ONE Gas common stock to be distributed.

What is “regular-way” and “ex-distribution” trading? Beginning on or shortly before the record date and continuing up to and including the distribution date, we expect there will be two markets in ONEOK common stock: a “regular-way” market and an “ex-distribution” market. Shares of ONEOK common stock that trade on the regular-way market will trade with an entitlement to receive shares of our common stock to be distributed in the distribution. Shares that trade on the ex-distribution market will trade without an entitlement to receive shares of our common stock to be distributed in the distribution, so that holders who sell shares ex-distribution will be entitled to receive shares of our common stock even though they have sold their shares of ONEOK common stock after the record date. Therefore, if you owned shares of ONEOK common stock on the record date and sell those shares on the regular-way market before the distribution date, you will also be selling the shares of our common stock that would have been distributed to you in the distribution. If you own shares of ONEOK common stock at on the record date and sell these shares in the ex-distribution market on any date up to and including the distribution date, you will still receive the shares of our common stock that you would be entitled to receive in respect of your ownership of the shares of ONEOK common stock that you sold. On the first trading following the distribution date, all shares of ONEOK will trade “ex-distribution.”

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You are encouraged to consult with your financial advisor regarding the specific implications of selling your ONEOK common stock prior to or on the distribution date, and you should make sure your stockbroker, bank or other nominee understands whether you want to sell your ONEOK common stock or your entitlement to ONE Gas common stock or both pursuant to the distribution.

Where will I be able to trade shares of ONE Gas common stock? There is not currently a public market for our common stock. We intend to apply to list our common stock on the NYSE under the ticker symbol “OGS.” We anticipate that trading in shares of our common stock will begin on a “when-issued” basis on or shortly before the record date and will continue up to and through the distribution date and that “regular-way” trading in shares of our common stock will begin on the first trading day following the distribution date. If trading begins on a “when-issued” basis, you may purchase or sell our common stock up to and through the distribution date, but your transaction will not settle until after the distribution date. We cannot predict the trading prices for our common stock before, on or after the distribution date.

What will happen to the listing of ONEOK common stock? Nothing. ONEOK common stock will continue to be traded on the NYSE under the symbol “OKE” following the distribution.

Will the number of ONEOK shares I own change as a result of the distribution? No. The number of shares of ONEOK common stock you own will not change as a result of the distribution.

Will the distribution affect the market price of my ONEOK shares? Yes. As a result of the distribution, we expect the trading price of shares of ONEOK common stock immediately following the distribution to be lower than the trading price immediately prior to the distribution because the trading price will no longer reflect the value of the natural gas distribution business. We and ONEOK anticipate that until the market has fully analyzed the value of ONEOK without the natural gas distribution business, the market price of a share of ONEOK common stock may fluctuate more than it otherwise might in the absence of the separation. In addition, although we have been advised that ONEOK believes that, over time following the distribution, the common stock of ONEOK and ONE Gas should have a higher aggregate market value, assuming the same market conditions that exist as of the date of this Information Statement, than if ONEOK were to remain under its current configuration, there can be no assurance of that, and thus the combined trading prices of a share of ONEOK common stock and ONE Gas common stock after the distribution may be equal to, greater than or less than the trading price of a share of ONEOK common stock before the distribution.

Are there risks to owning ONE Gas common stock? Yes. Ownership of ONE Gas common stock is subject to both general and specific risks relating to our business, our capital structure, the industry in which we operate, our relationship with ONEOK and our status as a separate, publicly-traded company. Our business is also

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subject to risks relating to the separation. These risks are described in the section entitled “Risk Factors” beginning on page 27. We encourage you to read that section and the other information in this Information Statement carefully.

Where can I obtain more information? Before the distribution, if you have any questions relating to the separation or ONEOK common stock, you should contact:

ONEOK, Inc.

Investor Relations Department

P.O. Box 871

Tulsa, OK 74102-0871

Tel.: 1-877-208-7318

e-mail: InvestorRelations@oneok.com

www.oneok.com

After the distribution, if you have any questions relating to the separation or our common stock, you should contact:

ONE Gas, Inc.

Tulsa, OK 74102

Tel.:

Toll-free:

Fax:

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Terms of the Separation

The following is a summary of the material terms of the separation, distribution and other related transactions.

Distributing company ONEOK, Inc.

Distributed company ONE Gas, Inc., an Oklahoma corporation and a wholly owned subsidiary of ONEOK that will own the assets, and be responsible for the liabilities, of ONEOK’s natural gas distribution business. After the distribution, ONE Gas will be a separate, publicly traded company.

Distribution ratio Each holder of ONEOK common stock will receive                  share(s) of our common stock for each share of ONEOK common stock held on the record date. Cash will be distributed in lieu of fractional shares, as described below.

Distributed securities All of the shares of ONE Gas common stock owned by ONEOK, which will be all of our common stock outstanding immediately prior to the distribution, will be distributed pro rata to ONEOK’s shareholders. Based on approximately                  shares of ONEOK common stock outstanding on                 , and the distribution ratio of                  share(s) of ONE Gas common stock for each share of ONEOK common stock, approximately                  shares of our common stock will be distributed to ONEOK shareholders. The number of our shares that ONEOK will distribute to its shareholders will be reduced to the extent of the cash payments to be made for fractional shares of our common stock.

Fractional shares ONEOK will not distribute any fractional shares of our common stock to its shareholders. Instead, Wells Fargo Bank, N.A., the distribution agent, will aggregate fractional shares into whole shares, sell on behalf of ONEOK shareholders the whole shares in the open market at prevailing market prices and distribute the aggregate net cash proceeds of the sales pro rata to each holder of ONEOK common stock who otherwise would have been entitled to receive a fractional share in the distribution. Recipients of cash in lieu of fractional shares will not be entitled to any interest on the amounts of payment made in lieu of fractional shares. The receipt of cash in lieu of fractional shares generally will be taxable to the recipient shareholders as described in the section entitled “The Separation—Certain U.S. Federal Income Tax Consequences of the Distribution.”

Record date The record date for the distribution is the close of business on             ,         .

Distribution date The distribution will take place on or before             ,         .

Distribution On the distribution date, ONEOK, with the assistance of Wells Fargo Bank, N.A., the distribution agent, will electronically issue shares of our common stock to you or to your bank or brokerage firm on your

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behalf by way of direct registration in book-entry form. You will not be required to make any payment, surrender or exchange your shares of ONEOK common stock or take any other action to receive your shares of our common stock.

If you sell shares of ONEOK common stock in the “regular-way” market through the distribution date, you will be selling your right to receive shares of ONE Gas common stock in the distribution.

Registered shareholders will receive additional information from the distribution agent shortly after the distribution date. Following the distribution, shareholders may request that their shares of ONE Gas common stock held in book-entry form be transferred to a brokerage or other account at any time, without charge. Beneficial shareholders that hold shares through a brokerage firm will receive additional information from their brokerage firms shortly after the distribution date.

Conditions to the distribution The distribution of our common stock is subject to the satisfaction or, if permissible under the Separation and Distribution Agreement, waiver by ONEOK of the following conditions, among other conditions described in this Information Statement:

• the SEC shall have declared effective our registration statement on Form 10, of which this Information Statement is a part, under the Exchange Act, and no stop order relating to the registration statement shall be in effect, and this Information Statement shall have been mailed to the holders of ONEOK’s common stock;

• ONEOK shall have received a surplus and solvency opinion from a nationally recognized valuation firm, in form and substance satisfactory to ONEOK, with respect to whether ONEOK should have adequate surplus to declare the distribution dividend and that, following the separation and distribution, each of ONEOK and ONE Gas should be solvent and adequately capitalized;

• all required federal, state and municipal approvals (including approval of the Kansas Corporation Commission) and consents necessary to consummate the separation and distribution shall have been received;

• we shall have received approximately $1.19 billion of cash from the issuance of debt securities and shall have made a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures;

• The IRS Ruling received by ONEOK shall not have been withdrawn, invalidated or modified in an adverse manner, and ONEOK shall have received the opinion of Skadden, tax counsel

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to ONEOK, which opinion will rely on the continued validity of the IRS Ruling, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling;

• the listing of our common stock on the NYSE shall have been approved, subject to official notice of issuance;

• no order, injunction or decree issued by any court of competent jurisdiction or other legal restraint or prohibition preventing consummation of the distribution or any of the transactions related thereto, including the debt financing and the transfers of assets and liabilities contemplated by the Separation and Distribution Agreement shall be in effect; and

• the board of directors of ONEOK shall have approved the distribution, which approval may be given or withheld in its absolute and sole discretion.

The fulfillment of these conditions does not create any obligation on ONEOK’s part to effect the distribution, and the ONEOK board of directors has reserved the right, in its sole discretion, to amend, modify or abandon the distribution and related transactions at any time prior to the distribution date. ONEOK has the right not to complete the distribution if, at any time, the ONEOK board of directors determines, in its sole discretion, that the distribution is not in the best interests of ONEOK or its shareholders or that market conditions are such that it is not advisable to separate the natural gas distribution business from ONEOK.

Stock exchange listing We intend to file an application to list our shares of common stock on the NYSE under the ticker symbol “OGS.” We anticipate that, on or prior to the record date for the distribution, trading of shares of our common stock will begin on a “when-issued” basis and will continue up to and through the distribution date. For additional information, see the section entitled “The Separation—Trading Between the Record Date and Through the Distribution Date.”

Transfer agent Wells Fargo Bank, N.A.

Address: 1110 Centre Point Curve, Suite 101,

Mendota Heights, MN 55120

Tel.: 800-689-8788

ONE Gas debt At September 30, 2013, we had $342.4 million payable on a short-term note payable to ONEOK and $1.0 billion payable on our long-term line of credit with ONEOK. As part of the reorganization, immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all of the amounts outstanding on our short-term note payable to and line of credit with ONEOK.

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In connection with the separation, we expect that we will receive approximately $1.19 billion of cash from the issuance of debt securities. We expect to make a cash payment of approximately $1.13 billion to ONEOK from the expected proceeds of these debt securities, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures.

The amount to be paid to ONEOK and the amount, type and term of the debt securities we will issue have not yet been determined but will be determined prior to the separation. A number of factors could affect this final determination, and the amount of debt securities ultimately issued could be different from the amount disclosed in this Information Statement.

Additionally, we have entered into a $700 million revolving credit facility and intend to enter into a commercial paper program to support our working capital and general corporate needs and normal course of business requirements after the separation.

ONEOK has informed us that the approximately $1.13 billion of cash proceeds it receives from us, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, will be used to repay outstanding ONEOK debt and/or repurchase ONEOK shares or pay dividends with respect to ONEOK shares, in each case within 18 months following the distribution.

For more information on our planned financing arrangements, please see the sections entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Description of Material Indebtedness.”

Risks relating to ownership of our common stock and the distribution Ownership of ONE Gas common stock is subject to both general and specific risks relating to our business, our capital structure, the industry in which we operate, our relationships with ONEOK and our status as a separate, publicly-traded company. Our business is also subject to risks relating to the separation. You should read carefully the section entitled “Risk Factors” beginning on page 27 in this Information Statement, as well as the other information contained in this Information Statement.

Tax consequences ONEOK has received the IRS Ruling to the effect that the distribution, together with certain related transactions, will qualify as tax-free to ONEOK, us and the ONEOK shareholders under Sections 355, 368(a)(1)(D) and other related provisions of the Code. It is a condition to the distribution that such IRS Ruling shall not have been

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withdrawn, invalidated or modified in an adverse manner. The distribution is also conditioned on the receipt by ONEOK of the opinion of Skadden, tax counsel to ONEOK, which opinion will rely on the continued validity of the IRS Ruling, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling. ONEOK expects to receive the opinion of Skadden on or prior to the distribution date.

A holder of ONEOK stock generally will recognize capital gain or loss with respect to cash received in lieu of fractional shares of our common stock.

Please see the sections entitled “Risk Factors—Risks Relating to the Separation—If the distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction for U.S. federal income tax purposes under Sections 355, 368(a)(1)(D) and other related provisions of the Code, then ONEOK and/or its shareholders could incur significant U.S. federal income tax liabilities, and we could incur significant indemnity obligations” and “The Separation—Certain U.S. Federal Income Tax Consequences of the Distribution” for more information regarding the IRS Ruling, the tax opinion and the potential tax consequences of the distribution. Holders of ONEOK common stock should consult their tax advisors as to the particular tax consequences of the distribution to them.

Certain agreements with ONEOK Before the distribution, we will enter into the Separation and Distribution Agreement and several other agreements with ONEOK to effect the distribution and provide a framework for our relationship with ONEOK after the distribution. These agreements will govern the relationship among us and ONEOK subsequent to the completion of the distribution and provide for the allocation among us and ONEOK of assets, liabilities and obligations (including employee benefits and tax-related assets and liabilities) relating to the natural gas distribution business attributable to periods prior to, at and after the distribution. We cannot assure you that these agreements will be on terms as favorable to us as agreements with unaffiliated third parties might be. For a discussion of these arrangements, see the sections entitled “Risk Factors—Risks Relating to the Separation” and “Certain Relationships and Related-Party Transactions.”

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Summary Selected Historical and Unaudited Pro Forma Financial Data

The following table sets forth the summary selected historical financial data for the periods indicated below. The summary selected historical unaudited financial data for the nine months ended September 30, 2013 and 2012, and balance sheet data as of September 30, 2013, have been derived from ONE Gas Predecessor’s unaudited financial statements included elsewhere in this Information Statement. Our Predecessor consists of the business attributable to ONEOK’s Natural Gas Distribution segment that will be transferred to us in connection with the separation. The unaudited financial statements have been prepared on the same basis as the Predecessor’s audited financial statements, and include all normal recurring adjustments that, in the opinion of management, are necessary to present fairly the financial condition and results of operations for such periods. The results of operations for the nine months ended September 30, 2013, presented below are not necessarily indicative of results for the entire fiscal year. The summary selected historical financial data as of December 31, 2012 and 2011, and for the years ended December 31, 2012, 2011 and 2010, have been derived from our Predecessor’s audited historical financial statements included elsewhere in this Information Statement. The summary selected historical financial data as of September 30, 2012, and December 31, 2010, have been derived from the unaudited accounting records of our Predecessor, which are not included in this Information Statement. The historical financial statements included in this Information Statement may not necessarily reflect our financial position, results of operations and cash flows as if we had operated as a stand-alone public company during all periods presented. Accordingly, our historical results should not be relied upon as an indicator of our future performance.

The selected unaudited pro forma financial data presented in the following table as of and for the nine months ended September 30, 2013, and the year ended December 31, 2012, are derived from the unaudited pro forma financial data included elsewhere in this Information Statement. The unaudited pro forma balance sheet data gives effect to the separation as if it had occurred on September 30, 2013. The unaudited pro forma statements of income data give effect to the separation as if it had occurred on January 1, 2012. The unaudited pro forma financial data are for illustrative purposes only, and do not reflect what our financial position and results of operations would have been had the separation occurred on the dates indicated and are not necessarily indicative of our future financial position and future results of operations.

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The following selected historical and unaudited pro forma financial data should be read in conjunction with “Capitalization,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Certain Relationships and Related-Party Transactions—Agreements with ONEOK” and the financial statements and related notes included elsewhere in this Information Statement

	ONE Gas Predecessor Historical															ONE Gas Pro Forma
	Years Ended December 31,									Nine Months Ended September 30,						Nine Months Ended September 30,			Year Ended December 31,
	2012			2011			2010			2013			2012			2013			2012
	(Millions of dollars)
Statement of income data:
Revenues	$	1,376.6		$	1,621.3		$	1,817.4		$	1,167.3		$	943.9		$	1,167.3		$	1,376.6
Net margin		756.4			751.8			754.9			589.4			545.8			589.4			756.4
Operating costs		410.5			419.9			398.3			334.0			310.8			334.0			410.5
Depreciation and amortization		130.2			132.2			131.0			100.1			97.5			100.1			130.2
Operating income		215.7			199.7			225.6			155.3			137.5			155.3			215.7
Interest expense*		(60.8	)		(54.1	)		(52.3	)		(45.7	)		(45.3	)		(45.7	)		(60.8	)
Income taxes		(59.9	)		(56.0	)		(67.1	)		(42.7	)		(35.7	)		(42.7	)		(59.9	)
Net income		96.5			86.8			106.4			68.9			57.9			68.9			96.5
Earnings per share**:
Basic
Diluted
	December 31,									September 30,						September 30,
	2012			2011			2010			2013						2013
	(Millions of dollars)
Balance sheet data:
Total assets	$	3,491.3		$	3,285.5		$	3,095.1		$	3,572.1					$	3,932.6
Long-term line of credit with ONEOK*		1,027.6			912.4			756.4			1,027.6						1,027.6
Long-term debt, including current maturities*		1.5			1.9			2.2			1.5						1.5
	Years Ended December 31,									Nine Months Ended September 30,
	2012			2011			2010			2013			2012
	(Millions of dollars)
Statement of cash flows data:
Cash flows provided by operating activities	$	196.6		$	192.8		$	233.4		$	176.1		$	224.2
Cash flows used in investing activities		(270.6	)		(240.8	)		(217.5	)		(205.3	)		(199.8	)
Cash flows provided by (used in) financing activities		73.5			50.5			(17.6	)		27.9			(26.2	)

* Pro forma long-term line of credit with ONEOK does not reflect ONEOK’s expected contribution of such amounts to our capital, and pro forma long-term debt does not reflect the expected issuance of approximately $1.2 billion of debt securities as the debt agreements are not expected to be executed prior to effectiveness of the registration statement of which this Information Statement is a part. Pro forma interest

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expense does not reflect the elimination of affiliate interest expense on amounts payable to ONEOK that are expected to be contributed to our capital and incurrence of interest expense on third-party debt expected to be issued prior to the separation. See footnote 2(f) of the “Notes to Unaudited Pro Forma Financial Statements” included elsewhere in this Information Statement for more information.

** Historical earnings per share are not presented because we did not have common stock that was part of our capital structure for the periods presented. The calculation of pro forma basic net income per share is calculated by dividing the pro forma net income by the weighted average number of shares of ONEOK common stock outstanding for the periods indicated, adjusted for an assumed distribution ratio of                  shares of our common stock for each share of ONEOK common stock outstanding. The calculation of pro forma diluted net income per share is calculated by dividing the pro forma net income by the weighted average number of shares of ONEOK common stock outstanding and diluted shares of common stock outstanding for the periods indicated, adjusted for the same distribution ratio. This calculation may not be indicative of the dilutive effect that will actually result from share-based awards subsequently transferred to or granted by ONE Gas.

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RISK FACTORS

You should carefully consider each of the following risk factors and all of the other information set forth in this Information Statement. The risk factors generally have been separated into three groups: (1) risks relating to our business, (2) risks relating to the separation, and (3) risks relating to ownership of our common stock. Based on the information currently known to us, the following information identifies the material risk factors affecting our company in each of these categories of risks. In addition, past financial performance may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods.

Risks Relating to Our Business

Unfavorable economic and market conditions could affect adversely our earnings.

Weakening economic activity in our markets could result in a loss of existing customers, fewer new customers, especially in newly constructed homes or a decline in energy consumption, any of which could affect adversely our revenues or restrict our future growth. It may become more difficult for customers to pay their natural gas bills, leading to slow collections and higher-than-normal levels of accounts receivable which in turn could increase our financing requirements and bad debt expense. The foregoing could affect negatively our business, financial condition, results of operations and cash flows.

Increases in the wholesale price of natural gas could reduce our earnings, increase our working capital requirements and impact adversely our customer base.

The supply and demand balance in natural gas markets could cause an increase in the price of natural gas. Recently, the increased production in the U.S. of natural gas from shale formations has put downward pressure on the wholesale cost of natural gas; however, restrictions or regulations on shale natural gas production, increased demand from natural gas fueled electric power generation or natural gas exports could cause natural gas prices to increase. Additionally, the CFTC under the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act has regulatory authority of the over-the-counter derivatives markets. Regulations affecting derivatives could increase the price of our natural gas supply.

An increase in the price of natural gas could cause us to experience a significant increase in short-term debt because we must pay suppliers for natural gas when purchased, which can be significantly in advance of when such costs may be recovered through the collection of customer bills, which could adversely affect our financial condition and cash flows.

Further, the volatility of natural gas prices may impact negatively our customers’ perception of natural gas. Natural gas costs are passed through to the customers of our LDCs based on the actual cost of the natural gas purchased by the particular LDC. Substantial fluctuations in natural gas prices can occur from year to year and sustained periods of high natural gas prices or of pronounced natural gas price volatility may lead to customers selecting other energy alternatives, such as electricity, and to increased scrutiny of the prudency of our natural gas procurement strategies and practices by our regulators. It may also cause new home developers, builders and new customers to select alternative sources of energy. Additionally, high natural gas prices may cause customers to conserve more and may also impact adversely our accounts receivable collections, resulting in higher bad-debt expense. The occurrence of any of the foregoing could affect adversely our business, financial condition, results of operations and cash flows, as well as our future growth opportunities.

In addition, customer demand for natural gas may decrease due to technological advancements that increase the efficiency of and decrease energy consumption of devices and equipment powered by natural gas.

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Regulatory actions could impact our ability to earn a reasonable rate of return on our invested capital and to recover fully our operating costs.

We are subject to regulation by the OCC, KCC, RRC and various municipalities in Texas. These agencies set the rates that we charge our customers for our services. There can be no assurance that we will be able to obtain rate increases or that our authorized rates of return will continue at the current levels. We monitor the rates of return we achieve compared with our allowed rates of return and initiate general and specific rate proceedings as needed. If a regulatory agency were to prohibit us from setting rates that allow for the timely recovery of our costs and a reasonable return by significantly lowering our allowed return or negatively altering our cost allocation, rate design or other tariff provisions, modifying or eliminating cost trackers, prohibiting recovery of regulatory assets or disallowing portions of our expenses, then our earnings could be impacted negatively. Rate cases also involve a risk of rate reduction, because once rates have been filed, they are still subject to challenge for their reasonableness by various interveners.

Further, accounting principles that govern our company permit certain assets that result from the regulatory process to be recorded on our balance sheets that could not be recorded under GAAP for nonregulated entities. We consider factors such as rate orders from regulators, previous rate orders for substantially similar costs, written approval from the regulators and analysis of recoverability from internal and external legal counsel to determine the probability of future recovery of these assets. If we determine future recovery is no longer probable, we would be required to write off the regulatory assets at that time, which would also affect negatively our results of operations. Regulatory authorities also review whether our natural gas costs are prudent and can adjust the amount of our natural gas costs that we pass through to our customers. If any of our natural gas costs were disallowed, our results of operations would also be affected negatively.

In the normal course of business in the regulatory environment, assets are placed in service before regulatory action is taken, such as filing a rate case or for interim recovery under a capital tracking mechanism that could result in an adjustment of our returns. Once we make a regulatory filing, regulatory bodies have the authority to suspend implementation of the new rates while studying the filing. Because of this process, we may suffer the negative financial effects of having placed in service assets that do not initially earn our authorized rate of return or may not be allowed recovery on such expenditures at all.

The profitability of our operations is dependent on our ability to recover timely the costs related to providing natural gas service to our customers. However, we are unable to predict the impact that new regulatory requirements will have on our operating expenses or the level of capital expenditures and we can not assure you that our regulators will continue to allow recovery of such expenditures in the future. Changes in the regulatory environment applicable to our business could impair our ability to recover costs absorbed historically by our customers, and impact negatively our results of operations, financial condition and cash flows.

Our risk-management policies and procedures may not be effective, and employees may violate our risk-management policies.

We expect to develop and implement a set of policies and procedures that involve both our senior management and the Audit Committee of our Board of Directors to assist us in managing risks associated with our business. These risk policies and procedures are intended to align strategies, processes, people, information technology and business knowledge so that risk is managed throughout the organization. However, as conditions change and become more complex, current risk measures may fail to assess adequately the relevant risk due to changes in the market and the presence of risks previously unknown to us. Additionally, if employees fail to adhere to our policies and procedures or if our policies and procedures are not effective, potentially because of future conditions or risks outside of our control, we may be exposed to greater risk than we had intended. Ineffective risk-management policies and procedures or violation of risk-management policies and procedures could have an adverse effect on our earnings, financial condition and cash flows.

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We are subject to comprehensive energy regulation by governmental agencies, and the recovery of our costs is dependent on regulatory action.

We are subject to comprehensive regulation by several state and municipal utility regulatory agencies, which significantly influences our operating environment and our ability to recover our costs from utility customers. The utility regulatory authorities in Oklahoma, Kansas and Texas regulate many aspects of our utility operations, including organization, financing, affiliate transactions, customer service and the rates that we can charge customers. The profitability of our operations is dependent on our ability to pass through costs related to providing natural gas to our customers by filing periodic rate cases. The regulatory environment applicable to our operations could impair our ability to recover costs historically absorbed by our customers.

We are unable to predict the impact that the future regulatory activities of these agencies will have on our operations. Changes in regulations or the imposition of additional regulations could have an adverse impact on our business, financial condition and results of operations. Further, the results of our operations could be impacted negatively if our authorized cost-recovery mechanisms do not function as anticipated.

Our business is subject to competition that could affect negatively our results of operations.

The natural gas distribution business is competitive, and we face competition from other companies that supply energy, including electric companies, propane dealers, renewable energy providers and coal companies in relation to sources of energy for electric power plants, as well as nuclear energy. Significant competitive factors include efficiency, quality and reliability of the services we provide and price.

The most significant product competition occurs between natural gas and electricity in the residential and small commercial markets. Natural gas competes with electricity for water and space heating, cooking, clothes drying and other general energy needs. Increases in the price of natural gas or decreases in the price of other energy sources could negatively impact our competitive position by decreasing the price benefits of natural gas to the consumer. Customers and builders typically make the decision on the type of equipment at initial installation and use the chosen energy source for the life of the equipment. Changes in the competitive position of natural gas relative to electricity and other energy products have the potential to cause a decline in consumption or in the number of natural gas customers.

Consumer conservation efforts, higher natural gas costs or decreases in the price of other energy sources may also allow competition from alternative energy sources for applications that have traditionally used natural gas, encouraging some customers to move away from natural gas-fired equipment to equipment fueled by other energy sources. Competition between natural gas and other forms of energy is also based on efficiency, performance, reliability, safety and other non-price factors. Technological improvements in other energy sources and events that impair the public perception of the non-price attributes of natural gas could erode our competitive advantage. These factors in turn could decrease the demand for natural gas, impair our ability to attract new customers, and cause existing customers to switch to other forms of energy or to bypass our systems in favor of alternative competitive sources. This could result in slow or no customer growth and could cause customers to reduce or cease using our product, thereby reducing our ability to make capital expenditures and otherwise grow our business and affecting adversely our financial condition, results of operations and cash flows.

Our business activities are concentrated in three states.

We provide natural gas distribution services to customers in Oklahoma, Kansas and Texas. Changes in the regional economies, politics, regulations and weather patterns of these states could negatively impact the growth opportunities available to us and the usage patterns and financial condition of our customers. This could affect adversely our financial condition, results of operations and cash flows.

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The availability of adequate natural gas pipeline transportation capacity and natural gas supply may decrease and impair our ability to meet customers’ natural gas requirements.

In order to meet customers’ natural gas demands, we must obtain sufficient natural gas supplies, pipeline capacity and storage capacity. If we are unable to obtain these, our ability to meet our customers’ natural gas requirements could be impaired and our financial condition and results of operations may be impacted adversely. A significant disruption to or reduction in that natural gas supply or pipeline capacity due to events including, but not limited to operational failures or disruptions, hurricanes, tornadoes, floods, freeze off of natural gas wells, terrorist or cyber-attacks or other acts of war, or legislative or regulatory actions, could reduce our normal supply of natural gas and thereby reduce our earnings.

A downgrade in our credit ratings could affect negatively our cost of and ability to access capital.

Our ability to obtain adequate and cost effective financing depends in part on our credit ratings. A negative change in our ratings outlook by our rating agencies could affect adversely our costs of borrowing and/or access to sources of liquidity and capital, particularly if we failed to maintain investment grade credit ratings. Such a downgrade could further limit our access to public and private credit markets and increase the costs of borrowing under available credit lines. Should our credit ratings be downgraded, it could limit our ability to obtain additional financing in the future for working capital, capital expenditures and acquisitions. An increase in borrowing costs without the ability to recover these higher costs in the rates charged to our customers could affect adversely our results of operations and cash flows by limiting our ability to earn our allowed rate of return.

We are subject to new and existing laws and regulations that may require significant expenditures or significant increases in operating costs or result in significant fines or penalties for noncompliance.

Our business and operations are subject to regulation by a number of agencies, including the FERC, the DOT, OSHA, the EPA, the CFTC and various regulatory agencies in Oklahoma, Kansas and Texas, and we are subject to numerous federal and state laws and regulations. Future changes to laws, regulations and policies may impair our ability to compete for business or to recover costs and may increase the cost of operations. Furthermore, because the language in some laws and regulations is not prescriptive, there is a risk that our interpretation of these laws and regulations may not be consistent with expectations of regulators. Any compliance failure related to these laws and regulations may result in fines, penalties or injunctive measures affecting operating assets. For example, under the Energy Policy Act of 2005, the FERC has civil penalty authority under the Natural Gas Act to impose penalties for current violations of up to $1 million per day for each violation. In addition, as the regulatory environment for our industry increases in complexity, the risk of inadvertent noncompliance could also increase. Our failure to comply with applicable regulations could result in a material adverse effect on our business, financial condition, results of operations and cash flows.

We are subject to strict regulations at many of our facilities regarding employee safety, and failure to comply with these regulations could affect adversely our financial results.

The workplaces associated with our facilities are subject to the requirements of OSHA, and comparable state statutes that regulate the protection of the health and safety of workers. The failure to comply with OSHA and state requirements or general industry standards, including keeping adequate records or preventing occupational exposure to regulated substances, could expose us to civil or criminal liability, enforcement actions, and regulatory fines and penalties and could have a material adverse effect on our business, financial condition, results of operations and cash flow.

We are subject to environmental regulations, which could affect adversely our operations or financial results.

We are subject to laws, regulations and other legal requirements enacted or adopted by federal, state and local governmental authorities relating to protection of the environment and health and safety matters, including those legal requirements that govern discharges of substances into the air and water, the management and

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disposal of hazardous substances and waste, the clean-up of contaminated sites, groundwater quality and availability, plant and wildlife protection, as well as work practices related to employee health and safety. Environmental legislation also requires that our facilities, sites and other properties associated with our operations be operated, maintained, abandoned and reclaimed to the satisfaction of applicable regulatory authorities. The failure to comply with these laws, regulations and other requirements could expose us to civil or criminal liability, enforcement actions and regulatory fines and penalties and could have a material adverse effect on our business, financial condition, results of operations and cash flow. We also own or retain certain liability for the environmental conditions at 12 former manufactured natural gas sites in Kansas, and expenses related to these sites could affect negatively our business, results of operations and cash flows. For additional information, see Note 9 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement.

We are subject to pipeline safety and system integrity laws and regulations that may require significant expenditures, significant increases in operating costs or, in the case of non-compliance, substantial fines.

We are subject to the Pipeline Safety Improvement Act of 2002, which requires companies like us that operate high-pressure pipelines to perform integrity assessments on pipeline segments that pass through densely populated areas or near specifically designated high-consequence areas. Further, the Pipeline Safety, Regulatory Certainty and Job Creation Act of 2011 increased the maximum penalties for violating federal pipeline safety regulations and directed the DOT and Secretary of Transportation to conduct further review or studies on issues that may or may not be material to us. Compliance with existing or new laws and regulations may result in increased capital, operating and other costs which may not be recoverable in rates from our customers or may impact materially our competitive position relative to other energy providers. Failure to comply with such laws and regulations may result in fines, penalties, or injunctive measures that would not be recoverable from customers in rates and could result in a material adverse effect on our financial condition, results of operations and cash flows. The failure to comply with these laws, regulations and other requirements could expose us to civil or criminal liability, enforcement actions, and regulatory fines and penalties and could have a material adverse effect on our business, financial condition, results of operations and cash flow.

Climate change, carbon neutral or energy-efficiency legislation or regulations could increase our operating costs or restrict our market opportunities, negatively affecting our growth, cash flows and results of operations.

The federal and/or state governments may enact legislation or regulations that attempt to control or limit the causes of climate change, including greenhouse gas emissions such as carbon dioxide. Such laws or regulations could impose costs tied to carbon emissions, operational requirements or restrictions, or additional charges to fund energy efficiency activities. They could also provide a cost advantage to alternative energy sources, impose costs or restrictions on end users of natural gas, or result in other costs or requirements, such as costs associated with the adoption of new infrastructure and technology to respond to new mandates. The focus on climate change could negatively impact the reputation of fossil fuel products or services. The occurrence of the foregoing events could put upward pressure on the cost of natural gas relative to other energy sources, increase our costs and the prices we charge to customers, reduce the demand for natural gas, and impact the competitive position of natural gas and the ability to serve new or existing customers, affecting negatively our business, results of operations and cash flows.

We are subject to physical and financial risks associated with climate change.

There is a growing belief that emissions of greenhouse gases may be linked to global climate change. Climate change creates physical and financial risk. Our customers’ energy needs vary with weather conditions, primarily temperature and humidity. For residential customers, heating and cooling represent their largest energy use. To the extent weather conditions may be affected by climate change, customers’ energy use could increase or decrease depending on the duration and magnitude of any changes. A decrease in energy use due to weather changes may affect our financial condition through decreased revenues and cash flows. Extreme weather

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conditions in general require more system backup, adding to costs, and can contribute to increased system stresses, including service interruptions. Weather conditions outside of our operating territory could also have an impact on our revenues and cash flows by affecting natural gas prices. Severe weather impacts our operating territories primarily through thunderstorms, tornados and snow or ice storms. To the extent the frequency of extreme weather events increases, this could increase our cost of providing service. We may not be able to pass on the higher costs to our customers or recover all the costs related to mitigating these physical risks. To the extent financial markets view climate change and emissions of greenhouse gases as a financial risk, this could affect negatively our ability to access capital markets or cause us to receive less favorable terms and conditions in future financings. Our business could be affected by the potential for lawsuits related to or against greenhouse gas emitters based on the claimed connection between greenhouse gas emissions and climate change, which could negatively impact our business, results of operations and cash flows.

Demand for natural gas is highly weather sensitive and seasonal, and weather conditions may cause our earnings to vary from year to year.

Our earnings can vary from year to year, depending in part on weather conditions, which directly influence the volume of natural gas delivered to customers. Natural gas sales to residential and commercial customers are seasonal, as a substantial portion of their natural gas requirements are for heating during the winter months. Warmer-than-normal weather can reduce our utility margins as customer consumption declines. We have implemented weather normalization mechanisms in Oklahoma, Kansas and portions of Texas, which are designed to limit our earnings sensitivity to weather. These weather-normalization adjustments, or WNA, allow us to increase customer billings to offset lower natural gas usage when weather is warmer than normal and decrease customer billings to offset higher natural gas usage when weather is colder than normal. If our rates and tariffs are modified to curtail such weather protection programs, then we would be exposed to additional risk associated with weather. As a result of occurrence of the foregoing, our results of operations and cash flows could vary and be impacted negatively.

We may not be able to complete necessary or desirable pipeline expansion or infrastructure development projects, which may delay or prevent us from serving our customers or expanding our business.

In order to serve new customers or expand our service to existing customers, we may need to maintain, expand or upgrade our distribution and/or transmission infrastructure, including laying new distribution lines. Various factors may prevent or delay us from completing such projects or make completion more costly, such as the inability to obtain required approval from local, state and/or federal regulatory and governmental bodies, public opposition to the project, inability to obtain adequate financing, competition for labor and materials, construction delays, cost overruns, and inability to negotiate acceptable agreements relating to construction or other material components of an infrastructure development project. As a result, we may not be able to serve adequately existing customers or support customer growth, which would impact negatively our business, stakeholder perception, financial condition, results of operations and cash flows.

We may pursue acquisitions, divestitures and other strategic transactions, the success of which may impact negatively our results of operations, cash flows and financial condition.

As part of our strategic objectives, we may pursue acquisitions to complement or expand our business, as well as divestures and other transactions. We may not be able to successfully negotiate, finance or receive regulatory approval for future acquisitions or integrate the acquired businesses with our existing business and services. Future acquisitions could result in potentially dilutive issuances of equity securities, a decrease in our liquidity as a result of our using a significant portion of our available cash or borrowing capacity to finance the acquisition, the incurrence of debt, contingent liabilities and amortization expenses and substantial goodwill. We may be affected materially and adversely if we are unable to integrate successfully businesses that we acquire.

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An impairment of goodwill and long-lived assets could reduce our earnings.

At September 30, 2013, we had $158.0 million of goodwill recorded on our balance sheet. Goodwill is recorded when the purchase price of a business exceeds the fair market value of the tangible and separately measurable intangible net assets. GAAP requires us to test goodwill for impairment on an annual basis or when events or circumstances occur indicating that goodwill might be impaired. Long-lived assets with finite useful lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If we determine that impairment is indicated, we would be required to take an immediate non-cash charge to earnings with a correlative effect on our equity and balance sheet leverage as measured by debt to total capitalization, which could impact adversely our financial condition and results of operations.

We may be unable to access capital or our cost of capital may increase significantly.

Our ability to obtain adequate and cost effective financing is dependent upon the liquidity of the financial markets, in addition to our credit ratings. Disruptions in the capital and credit markets could adversely affect our ability to access short-term and long-term capital. Our access to funds under our revolving credit facility will be dependent on the ability of the participating banks to meet their funding commitments. Those banks may not be able to meet their funding commitments if they experience shortages of capital and liquidity. Disruptions and volatility in the global credit markets could cause the interest rate we pay on our revolving credit facility, which we expect will be based on the London Interbank Offered Rate (“LIBOR”), to increase, could result in higher interest rates on future financings, and could impact the liquidity of the lenders under our revolving credit facility, potentially impairing their ability to meet their funding commitments to us. Disruptions in the capital and credit markets as a result of uncertainty, changing or increased regulation or failures of significant financial institutions could adversely affect our access to capital needed for our business. The inability to access adequate capital or an increase in the cost of capital may require us to conserve cash, prevent or delay us from making capital expenditures, and require us to reduce or eliminate our dividend or other discretionary uses of cash. A significant reduction in our liquidity could cause a negative change in our ratings outlook or even a reduction in our credit ratings. This could in turn further limit our access to credit markets and increase our costs of borrowing.

Changes in federal and state fiscal, tax and monetary policy could significantly increase our costs or decrease our cash flows.

Changes in federal and state fiscal, tax and monetary policy may result in increased taxes, interest rates, and inflationary pressures on the costs of goods, services and labor. This could increase our expenses and capital spending and decrease our cash flows if we are not able to recover or recover timely such increased costs from our customers. This series of events may increase our rates to customers and thus may impact negatively customer billings and customer growth. Changes in tax rules could affect negatively our cash flows. Any of these events may cause us to increase debt, conserve cash, affect negatively our ability to make capital expenditures to grow the business or other discretionary uses of cash, and could negatively affect our cash flows.

Federal, state and local jurisdictions may challenge our tax return positions.

The preparation of our federal and state tax return filings may require significant judgments, use of estimates and the interpretation and application of complex tax laws. Significant judgment is also required in assessing the timing and amounts of deductible and taxable items. Despite management’s expectation that our tax return positions will be fully supportable, certain positions may be challenged successfully by federal, state and local jurisdictions.

As a result of cross-default provisions in our borrowing arrangements, we may be unable to satisfy all of our outstanding obligations in the event of a default on our part.

The terms of our debt agreements are expected to contain (and the terms of our revolving credit facility contain) cross-default and cross-acceleration provisions which provide that we will be in default under such

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agreements in the event of payment defaults under certain debt agreements and other defaults the effect of which is to cause the maturity of such other debt agreements to be accelerated. Accordingly, should such events occur under any of those agreements, we would face the prospect of being in default under all of our material debt agreements, obliged in such instance to satisfy all of our outstanding indebtedness simultaneously. In such an event, we may not be able to obtain alternative financing or, if we are able to obtain such financing, we may not be able to obtain it on terms acceptable to us, which would affect negatively our ability to implement our business plan, have flexibility in planning for, or reacting to, changes in our business, make capital expenditures and finance our operations.

The cost of providing pension and postretirement health care benefits to eligible employees and qualified retirees is subject to changes in pension fund values and changing demographics and may increase. In addition, the passage of the Patient Protection and Affordable Care Act in 2010 could increase the cost of health care benefits for our employees. Further, the costs to us of providing such benefits and related funding requirements are subject to the continued and timely recovery of such costs through our rates.

Liabilities related to employee and retiree benefit plans generally will be assigned based on the individual’s last employment, so each individual who (1) retired from ONEOK while providing service to the natural gas distribution segment, (2) is currently associated with the natural gas distribution business or (3) will be assigned to ONE Gas following the separation will have his or her benefit plan liabilities assigned to ONE Gas.

Employee and retiree benefit liabilities relating to all other personnel not meeting one of the three criteria above will remain the liability of ONEOK. Assets in the benefit plans are expected to be assigned in accordance with the applicable rules and regulations associated with the division of a single plan into separate plans. We expect to have defined benefit pension plans and postretirement welfare plans for certain employees. Following the separation and assignment of plan participants, our defined benefit plans are expected to be closed to new participants, and our post-retirement welfare plans are expected only to subsidize costs for providing postretirement medical benefits for certain participants. The cost of providing these benefits to eligible current and former employees is subject to changes in the market value of our pension and postretirement benefit plan assets, changing demographics, including longer life expectancy of plan participants and their beneficiaries and changes in health care costs.

Any sustained declines in equity markets and reductions in bond yields may have a material adverse effect on the value of our pension and postretirement benefit plan assets. In these circumstances, additional cash contributions to our pension and postretirement benefit plans may be required, which could have a material adverse impact on our financial condition and cash flows.

In addition, the costs of providing health care benefits to our employees could increase over the next five to ten years due in large part to the Pension Protection and Affordable Care Act of 2010. The future costs of compliance with its provisions are difficult to measure at this time. Also, our costs of providing such benefits and related funding requirements could also increase materially in the future, depending on the timing of the recovery, if any, of such costs through our rates, which could impact adversely our financial condition and cash flows.

Our business is subject to operational hazards and unforeseen interruptions that could affect materially and adversely our business and for which we may not be insured adequately.

We are subject to all of the risks and hazards typically associated with the natural gas distribution business. Operating risks include but are not limited to leaks, pipeline ruptures and the breakdown or failure of equipment or processes. Other operational hazards and unforeseen interruptions include adverse weather conditions, accidents, explosions, fires, the collision of equipment with our pipeline facilities (for example, this may occur if a third party were to perform excavation or construction work near our facilities) and catastrophic events such as tornados, hurricanes, earthquakes, floods or other similar events beyond our control. It is also possible that our facilities could be direct targets or indirect casualties of an act of terrorism, including cyber attacks. A casualty occurrence might result in injury or loss of life, extensive property damage or environmental damage. The location of pipeline facilities near populated areas, including residential areas, commercial business centers and

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industrial gathering places, could increase the level of damages resulting from these risks. Liabilities incurred and interruptions to the operations of our pipelines or other facilities caused by such an event could reduce revenues generated by us and increase expenses, which could have a material adverse effect on our financial condition, results of operations and cash flows. Additionally, our regulators may not allow us to recover part or all of the increased cost related to the foregoing events from our customers, which would affect negatively our earnings.

While we have general liability and property insurance currently in place in amounts that we consider appropriate based on our assessment of business risk and best practices in our industry and in general business, such policies are subject to certain limits and deductibles. Further, we are not fully insured against all risks inherent in our business. As a result of market conditions, premiums and deductibles for certain insurance policies can increase substantially, and, in some instances, certain insurance may become unavailable or available only for reduced amounts of coverage. Consequently, we may not be able to renew existing insurance policies or purchase other desirable insurance on commercially reasonable terms, if at all.

The insurance proceeds received for any loss of, or any damage to, any of our facilities or to third parties may not be sufficient to restore the total loss or damage. Further, the proceeds of any such insurance may not be paid in a timely manner. The occurrence of any of the foregoing could have a material adverse effect on our financial condition, results of operations and cash flows.

A failure in our operational systems or cyber security attacks on any of our facilities, or those of third parties, may affect adversely our financial results.

Our business will be dependent upon our operational systems to process a large amount of data and complex transactions. If any of our financial, operational or other data processing systems fail or have other significant shortcomings, our financial results could be affected adversely. Our financial results could also be affected adversely if an employee causes our operational systems to fail, either as a result of inadvertent error or by deliberately tampering with or manipulating our operational systems. In addition, dependence upon automated systems may further increase the risk that operational system flaws, employee tampering or manipulation of those systems will result in losses that are difficult to detect.

Due to increased technology advances, we have become more reliant on technology to help increase efficiency in our business. We use computer programs to help run our financial and operations organizations, and this may subject our business to increased risks. Any future cyber security attacks that affect our distribution facilities, our customers or any financial data could have a material adverse effect on our businesses. In addition, cyber attacks on our customer and employee data may result in a financial loss and may impact negatively our reputation. Third-party systems on which we rely could also suffer operational system failure.

The foregoing events could affect adversely our business reputation, diminish customer confidence, disrupt operations, subject us to financial liability or increased regulation, increase our costs and expose us to material legal claims and liability, and our business, financial condition and results of operations could be affected adversely.

Our business could be affected adversely by strikes or work stoppages by our unionized employees.

Immediately following the separation, we expect that approximately 700 of the estimated 3,100 employees who will be working for us will be represented by collective-bargaining units under collective-bargaining agreements. We are involved periodically in discussions with collective-bargaining units representing some of our employees to negotiate or renegotiate labor agreements. We cannot predict the results of these negotiations, including whether any failure to reach new agreements will have a negative effect on our business, financial condition and results of operations or whether we will be able to reach any agreement with the collective-bargaining units. Any failure to reach agreement on new labor contracts might result in a work stoppage. Any

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future work stoppage could, depending on the operations and the length of the work stoppage, have a material adverse effect on our financial condition and results of operations.

A shortage of skilled labor may make it difficult for us to maintain labor productivity and competitive costs, which could affect negatively operations and cash flows. Further, we may be unable to attract and retain professional and technical employees, which could adversely impact our earnings.

Our operations require skilled and experienced workers with proficiency in multiple tasks. In recent years, a shortage of workers trained in various skills associated with the natural gas distribution business has caused us to conduct certain operations without full staff, thus hiring outside resources, which may decrease productivity and increase costs. This shortage of trained workers is the result of experienced workers reaching retirement age and increased competition for workers in certain areas, combined with the difficulty of attracting new workers to the natural gas distribution industry. This shortage of skilled labor could continue over an extended period. If the shortage of experienced labor continues or worsens, it could have an adverse impact on labor productivity and costs and our ability to meet the needs of our customers in the event there is an increase in the demand for our products and services, which could affect adversely our business and cash flows.

Our ability to implement our business strategy and serve our customers is dependent upon our ability to employ talented professionals and attract and retain a skilled workforce. We are subject to the risk that we will not be able to effectively replace the knowledge and expertise of retiring employees. Without a skilled workforce, our ability to provide quality service to our customers and meet our regulatory requirements will be challenged, and this could impact negatively our business, financial condition, results of operations and cash flows.

Changes in accounting standards may adversely impact our financial condition and results of operations.

The SEC is considering whether issuers in the United States should be required to prepare financial statements in accordance with IFRS instead of the current GAAP. IFRS is a comprehensive set of accounting standards promulgated by the IASB which are currently in effect for most other countries in the world. Unlike GAAP, IFRS does not provide currently an industry accounting standard for rate-regulated activities. As such, if IFRS were adopted in its current state, we may be precluded from applying certain regulatory accounting principles, including the recognition of certain regulatory assets and regulatory liabilities. The potential issues associated with rate-regulated accounting, along with other potential changes associated with the adoption of IFRS, may impact adversely our reported financial condition and results of operations should adoption of IFRS be required. Also, the U.S. Financial Accounting Standards Board is considering various changes to GAAP, some of which may be significant, as part of a joint effort with the IASB to converge accounting standards over the next several years. If approved, adoption of these changes may impact adversely our reported financial condition and results of operations.

Risks Relating to the Separation

We may be unable to achieve some or all of the benefits that we expect to achieve from our separation from ONEOK.

We may be unable to achieve the full strategic and financial benefits that we expect will result from our separation from ONEOK or such benefits may be delayed or may not occur at all. For example, there can be no assurance that analysts and investors will regard our corporate structure as clearer and simpler than the current ONEOK corporate structure or place a greater value on our company as a stand-alone company than on our business as a part of ONEOK. In addition, we may not be able to allocate capital more efficiently or attract a more focused investor base. As a result, in the future the aggregate market price of ONEOK’s common stock and our common stock as separate companies may be less than the market price per share of ONEOK’s common stock had the separation and distribution not occurred.

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We are being separated from ONEOK, our parent company, and, therefore, we have no operating history as a separate, publicly-traded company.

The historical and pro forma financial information included in this Information Statement does not necessarily reflect the financial condition, results of operations or cash flows that we would have achieved as a separate, publicly-traded company during the periods presented or those that we will achieve in the future primarily as a result of the following factors:

• Prior to the separation, our business was operated by ONEOK as part of its broader corporate organization, rather than as a separate, publicly-traded company. ONEOK or one of its affiliates performed various corporate functions for us, including, but not limited to, information technology, accounts payable, cash management, treasury, tax administration, legal, regulatory, certain governance functions (including compliance with the Sarbanes-Oxley Act of 2002, Dodd-Frank Wall Street Reform and the Consumer Protection Act of 2010) and internal audit and external reporting. Our historical and pro forma financial results reflect allocations of corporate expenses from ONEOK for these and similar functions. These allocations may be inconsistent with what the expenses could have been had we operated as a separate, publicly-traded company.

• Historically, we have shared economies of scope and scale in costs, employees and vendor relationships with ONEOK. While we expect to enter into short-term transition agreements that will govern certain commercial and other relationships among us and ONEOK, those contractual arrangements may not capture the benefits our business historically has received. The loss of these benefits of scope and scale may have an adverse effect on our business, results of operations, financial condition and liquidity following the completion of the separation.

• Subsequent to the completion of the separation, the borrowing costs for our business may actually be higher than ONEOK’s borrowing costs and our borrowing costs as reflected in our historical financial statements prior to the separation. Please see the section entitled “Description of Material Indebtedness.”

• Prior to the separation, ONEOK expects to incur separation costs for professional services, including financial advisors, legal, accounting, information technology, human resources and other business consultants. ONEOK will not allocate these separation costs to us. Subsequent to the separation, we will incur additional expenses as a result of being a stand-alone publicly traded company. Under the terms of the Separation and Distribution Agreement, we will be responsible for all costs and expenses that we incur as a stand-alone company after the distribution.

We may be unable to make, on a timely basis, the changes necessary to operate as a separate, publicly-traded company, and we may experience increased costs after the separation or as a result of the distribution.

Following the completion of the separation, ONEOK will be obligated contractually to provide us with services specified in the agreements we enter into with ONEOK in connection with the separation. If ONEOK is unable or unwilling to continue providing these services when such agreements expire, we may be unable to replace, on comparable terms, the services that ONEOK previously provided to us (e.g., information technology, accounting and internal controls compliance services). Also, upon the expiration or termination of the Transition Services Agreement or other agreements, many of the services that are covered in such agreements will be provided internally or by unaffiliated third parties, and we may incur higher costs to obtain such services than we incurred under the terms of such agreements with ONEOK. In addition, if ONEOK does not continue to perform effectively the services that are called for under the Transition Services Agreement and the other agreements, we may not be able to operate our business effectively, which may affect adversely our financial condition, results of operations and cash flows. For more information, please see the section entitled “Certain Relationships and Related-Party Transactions.”

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We will be responsible for certain contingent and other liabilities related to the existing natural gas distribution business of ONEOK, as well as a portion of any contingent corporate liabilities of ONEOK that do not relate to either the natural gas distribution business or ONEOK’s remaining businesses.

Under the Separation and Distribution Agreement, we will assume and be responsible for certain contingent and other corporate liabilities related to the existing natural gas distribution business of ONEOK (including associated costs and expenses, whether arising prior to, at, or after the distribution). In addition, we may also be responsible for sharing unknown liabilities that do not relate to either our business following the separation or the business of ONEOK following the separation (for example, liabilities associated with certain corporate activities not specifically attributable to either business). If we are required to indemnify ONEOK or are otherwise liable for these liabilities, they may have a material adverse effect on our financial condition, results of operations and cash flows. Under the Separation and Distribution Agreement, we will be responsible for a portion of any contingent corporate liabilities of ONEOK that do not relate to either the natural gas distribution business or ONEOK’s remaining businesses. For a more detailed description of the Separation and Distribution Agreement and treatment of certain historical ONEOK contingent and other corporate liabilities, see “Certain Relationships and Related-Party Transactions—Agreements with ONEOK—Separation and Distribution Agreement.”

Third parties may seek to hold us responsible for liabilities of ONEOK that we did not assume in our agreements.

Third parties may seek to hold us responsible for retained liabilities of ONEOK. Under our agreements with ONEOK, ONEOK will agree to indemnify us for claims and losses relating to these retained liabilities. However, if those liabilities are significant and we are ultimately held liable for them, we cannot assure you that we will be able to recover the full amount of our losses from ONEOK.

Our prior and continuing relationship with ONEOK exposes us to risks attributable to businesses of ONEOK.

ONEOK is obligated to indemnify us for losses that a party may seek to impose upon us or our affiliates for liabilities relating to the business of ONEOK. After the separation, any claims made against us that are properly attributable to ONEOK in accordance with these arrangements would require us to exercise our rights under our agreements with ONEOK to obtain payment from ONEOK. We are exposed to the risk that, in these circumstances, ONEOK cannot, or will not, make the required payment.

Our debt could have a material adverse effect on our business and may make it difficult for us to service our debt and operate our business.

Upon issuance of our debt securities and with our entry into our revolving credit facility, we will have substantial debt. In addition, subject to restrictions in the indenture governing our debt securities and restrictions in our revolving credit facility, we may incur additional debt.

Our substantial debt could have important consequences for our business and operations, including:

• making it more difficult for us to satisfy our obligations under the debt securities and our other debt and liabilities;

• increasing our vulnerability to, and reducing our flexibility to respond to, a downturn in our business or general economic and industry conditions;

• requiring us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thus reducing the availability of our cash flow to fund internal growth through working capital and capital expenditures and for other general corporate purposes;

• placing us at a competitive disadvantage compared to our competitors that have proportionally less debt or greater access to capital resources than we have;

• limiting our flexibility in planning for or reacting to changes in our business and our industry;

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• negatively impacting credit terms with our creditors;

• restricting us from exploiting business opportunities;

• making us vulnerable to interest rate increases, as certain of our borrowings, including those under the revolving credit facility, will be at variable rates;

• affecting our liquidity by limiting our ability to obtain additional financing for working capital, limiting our ability to obtain financing for capital expenditures and acquisitions or making any available financing more costly; and

• resulting in an event of default if we fail to satisfy our payment obligations under the debt securities, our revolving credit facility, or our other debt, which event of default could result in all of the debt securities, utilizations under our revolving credit facility and our other debt becoming immediately due and payable.

Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, and prospects. See the section entitled “Description of Material Indebtedness.”

Our financing arrangements will subject us to various restrictions that could limit our operating flexibility.

We expect that the covenants in the indenture governing our debt securities and our revolving credit facility will restrict our ability to create or permit certain liens and to consolidate, merge or convey, transfer or lease our properties and assets substantially as an entity. Our revolving credit facility also includes a requirement that our debt to total capital ratio may not exceed 70% as of the end of any calendar quarter. Events beyond our control could impair our ability to satisfy this requirement.

As long as our indebtedness remains outstanding, these restrictive covenants could impair our ability to expand or pursue our growth strategy. In addition, the breach of any covenants or any payment obligations in any of these debt agreements will result in an event of default under the applicable debt instrument. If there were an event of default under one of our debt agreements, the holders of the defaulted debt may have the ability to cause all amounts outstanding with respect to that debt to be due and payable, subject to applicable grace periods. This could trigger cross-acceleration under our other debt agreements, including our debt securities. Forced repayment of some or all of our indebtedness would reduce our available cash and have an adverse impact on our financial condition and results of operations. See the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” and “Description of Material Indebtedness.”

Some of our debt, including borrowings under our revolving credit facility, could be based on variable rates of interest, which could result in higher interest expenses in the event of an increase in interest rates.

In the future, we could be exposed to fluctuations in variable interest rates. This increases our exposure to fluctuations in market interest rates. Amounts borrowed under our revolving credit facility will be based on variable rates of interest. The interest rates on those borrowings will vary depending on a fluctuating base rate or a rate based off of LIBOR at our selection. If these rates rise, the interest rate on this debt will also increase. Therefore, an increase in these rates may increase our interest payment obligations and have a negative effect on our cash flow and financial position. See the section entitled “Description of Material Indebtedness—Our Revolving Credit Facility.”

The ownership by our executive officers and some of our directors of shares of common stock or equity awards of ONEOK may create, or may create the appearance of, conflicts of interest.

Because of their current or former positions with ONEOK, substantially all of our executive officers, including our chief executive officer and some of our non-employee director nominees, own shares of ONEOK

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common stock and equity awards based on ONEOK common stock. Upon ONEOK’s distribution of all of the shares of our outstanding common stock to ONEOK shareholders, these equity awards could be converted into equity awards based in part on ONEOK common stock and in part on our common stock. Accordingly, following ONEOK’s distribution of all of the shares of our outstanding common stock to ONEOK shareholders, these officers and non-employee directors could own shares of both ONEOK and our common stock and other equity awards based on shares of common stock of both ONEOK and us. The individual holdings of common stock and other equity awards based common stock of ONEOK may be significant for some of these persons compared with these persons’ total assets. Ownership by our directors and officers, after the distribution, of common stock and other equity awards based common stock of ONEOK may create, or may create the appearance of, conflicts of interest when these directors and officers are faced with decisions that could have different implications for ONEOK than the decisions do for us.

If the distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction for U.S. federal income tax purposes under Sections 355, 368(a)(1)(D) and other related provisions of the Code, then ONEOK and/or its shareholders could incur significant U.S. federal income tax liabilities, and we could incur significant indemnity obligations.

ONEOK has received the IRS Ruling to the effect that the distribution, together with certain related transactions, will qualify as tax-free to ONEOK, us and the ONEOK shareholders under Sections 355, 368(a)(1)(D) and other related provisions of the Code. It is a condition to the distribution that such IRS Ruling shall not have been withdrawn, invalidated or modified in an adverse manner. The distribution is also conditioned on the receipt by ONEOK of the opinion of Skadden, tax counsel to ONEOK, which opinion will rely on the continued validity of the IRS Ruling, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling. ONEOK expects to receive the opinion of Skadden on or prior to the distribution date.

Although the IRS Ruling is generally binding on the IRS, the continuing validity of the ruling is subject to the accuracy of factual statements and representations made to the IRS by ONEOK upon which the ruling is based. Further, as a result of the IRS’s general ruling policy with respect to transactions under Section 355 of the Code, the IRS Ruling does not represent a determination by the IRS that certain requirements necessary to obtain tax-free treatment to holders of ONEOK common stock and to ONEOK have been satisfied. Rather, the IRS Ruling is based upon representations by ONEOK that these conditions have been satisfied, and any inaccuracy in such representations could invalidate the ruling. As a result of this IRS policy, the distribution is also conditioned upon the receipt by ONEOK of the tax opinion described above. The opinion will be based upon certain assumptions, as well as statements, representations and certain undertakings made by our officers and the officers of ONEOK. If any of those statements, representations or assumptions is incorrect or untrue in any material respect or any of those undertakings is not complied with, the conclusions reached in such opinion could be adversely affected. Opinions of counsel are not binding on the IRS. As a result, the conclusions expressed in the opinion of counsel could be challenged by the IRS, and a court could sustain such challenge, in which case the tax consequences to you could be materially less favorable.

Even if the distribution otherwise qualifies under Sections 355, 368(a)(1)(D) and other related provisions of the Code, the distribution would result in a significant U.S. federal income tax liability to ONEOK (but not to holders of ONEOK common stock) under Section 355(e) of the Code if one or more persons acquire a 50-percent or greater interest (measured by vote or value) in the stock of ONEOK or in our stock as part of a plan or series of related transactions that includes the distribution. Current tax law generally creates a presumption that any acquisition of the stock of ONEOK or our stock within two years before or after the distribution is part of a plan that includes the distribution, although the parties may be able to rebut that presumption. The process for determining whether an acquisition is part of a plan under these rules is complex, inherently factual and subject to an analysis of the facts and circumstances of a particular case. Notwithstanding the IRS Ruling or the opinion of counsel described above, we or ONEOK might inadvertently cause or permit a prohibited change in our or ONEOK’s ownership to occur, thereby triggering tax liability to ONEOK.

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If the distribution were subsequently determined, for whatever reason, not to qualify as a transaction that is tax-free for U.S. federal income tax purposes under Sections 355, 368(a)(1)(D), and other related provisions of the Code, ONEOK and/or the holders of ONEOK common stock immediately prior to the distribution could incur significant tax liabilities determined in the manner described in the section entitled “The Separation—Certain U.S. Federal Income Tax Consequences of the Distribution.” Furthermore, in certain circumstances as described further under “Certain Relationships and Related-Party Transactions—Agreements with ONEOK—Tax Matters Agreement,” we will be required to indemnify ONEOK, its subsidiaries, and certain related persons for taxes and related expenses resulting from the distribution, which could be material. For a more complete discussion of the IRS Ruling, the tax opinion and the tax consequences if the distribution is not tax-free, please see “The Separation—Certain U.S. Federal Income Tax Consequences of the Distribution.”

To preserve the tax-free treatment to ONEOK and/or its shareholders of the distribution and certain related transactions, we may not be able to engage in certain transactions.

To preserve the tax-free treatment to ONEOK and/or its shareholders of the distribution and certain related transactions, we are restricted, under the Tax Matters Agreement, from taking any action that prevents such transactions from being tax-free for U.S. federal, state and local income tax purposes. These restrictions may limit our ability to pursue certain strategic transactions or engage in other transactions, including using our common stock to make acquisitions and in connection with equity capital market transactions that might increase the value of our business. For additional detail, see “Certain Relationships and Related-Party Transactions—Agreements with ONEOK—Tax Matters Agreement.”

Risks Relating to Our Common Stock

There is no existing market for our common stock, and a trading market that will provide you with adequate liquidity may not develop for our common stock. In addition, once our common stock begins trading, the market price of our shares may fluctuate widely.

There is currently no public market for our common stock. It is anticipated that, on or prior to the record date for the distribution, trading of shares of our common stock will begin on a “when-issued” basis on the NYSE and will continue up to and through the distribution date. However, there can be no assurance that an active trading market for our common stock will develop as a result of the separation or be sustained in the future.

We cannot predict the prices at which our common stock may trade after the separation. The market price of our common stock may fluctuate widely, depending upon many factors, some of which may be beyond our control, including:

• a shift in our investor base;

• the price and availability of natural gas pipeline capacity and/or natural gas in the markets we serve;

• our quarterly or annual earnings, or those of other companies in our industry;

• actual or anticipated fluctuations in our operating results due to the seasonality of our business and other factors related to our business;

• changes in accounting standards, policies, guidance, interpretations or principles;

• announcements by us or our competitors of significant acquisitions or dispositions;

• the failure of securities analysts to cover our common stock after the distribution;

• changes in earnings estimates by securities analysts or our ability to meet those estimates;

• the operating and stock price performance of other comparable companies;

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• overall market fluctuations; and

• general economic conditions.

Stock markets in general have experienced volatility that has often been unrelated to the operating or financial performance of a particular company. These broad market fluctuations may adversely affect the trading price of our common stock.

Substantial sales of common stock may occur in connection with the separation, which could cause our stock price to decline.

The shares of our common stock that ONEOK distributes to its shareholders generally may be sold immediately in the public market. Although we have no actual knowledge of any plan or intention on the part of any shareholder to sell our common stock following the distribution, it is possible that some ONEOK shareholders, including possibly some of our largest shareholders, may sell our common stock received in the distribution for reasons such as our business profile or market capitalization as a separate, publicly-traded company does not fit their investment objectives. Moreover, index funds tied to the Standard & Poor’s 500 Index, the Russell 1000 Index and other indices hold shares of ONEOK common stock. To the extent our common stock is not included in these indices after the distribution, certain of these index funds may likely be required to sell the shares of our common stock that they receive in the distribution. The sales of significant amounts of our common stock or the perception in the market that this will occur may result in the lowering of the market price of our common stock.

Provisions in our certificate of incorporation, our bylaws, Oklahoma law and certain of the agreements into which we will enter as part of the separation may prevent or delay an acquisition of our company, which could decrease the trading price of our common stock.

Our certificate of incorporation, bylaws and Oklahoma law contain provisions that are intended to deter coercive takeover practices and inadequate takeover bids by making such practices or bids unacceptably expensive to the raider and to encourage prospective acquirers to negotiate with our board of directors rather than to attempt a hostile takeover. These provisions include, among others:

• a board of directors that is divided into three classes with staggered terms;

• rules regarding how shareholders may present proposals or nominate directors for election at shareholder meetings;

• the right of our board of directors to issue preferred stock without shareholder approval; and

• limitations on the right of shareholders to remove directors.

Oklahoma law also imposes some restrictions on mergers and other business combinations between us and any holder of 15 percent or more of our outstanding common stock. For more information, see the sections entitled “Description of ONE Gas Capital Stock—Higher Vote for Some Business Combinations and Other Actions,” “Description of ONE Gas Capital Stock—Classified Board of Directors” and “Description of ONE Gas Capital Stock—Oklahoma Law.”

We believe these provisions are important for a new public company and protect our shareholders from coercive or otherwise potentially unfair takeover tactics by requiring potential acquirers to negotiate with our board of directors and by providing our board of directors with more time to assess any acquisition proposal. These provisions are not intended to make our company immune from takeovers. However, these provisions apply even if the offer may be considered beneficial by some shareholders and could delay or prevent an acquisition that our board of directors determines is not in the best interests of our company and our shareholders.

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Our ability to pay dividends on our common stock will depend on our ability to generate sufficient positive earnings and cash flows.

Our ability to pay dividends in the future will depend upon, among other things, our future earnings, cash flows and restrictive covenants, if any, under future credit agreements to which we may be a party. Our cash available for dividends will principally be generated from our operations. Because the cash we generate from operations will fluctuate from quarter to quarter, we may not be able to maintain future dividends at the levels we expect or at all. Our ability to pay dividends depends primarily on cash flows, including cash flows from changes in working capital, and not solely on profitability, which is affected by non-cash items. As a result, we may pay dividends during periods when we record net losses and may be unable to pay cash dividends during periods when we record net income.

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FORWARD-LOOKING STATEMENTS

Our reports, filings and other public announcements may contain or incorporate by reference statements that do not directly or exclusively relate to historical facts. Such statements are “forward-looking statements.” You can typically identify forward-looking statements by the use of forward-looking words, such as “may,” “will,” “might,” “could,” “should,” “project,” “believe,” “anticipate,” “expect,” “intend,” “estimate,” “scheduled,” “continue,” “potential,” “plan,” “forecast,” “goal,” “guidance” and other similar words. Those statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors. Many of those factors are outside our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Those factors include those set forth in the section entitled “Risk Factors,” as well as the following:

• our ability to recover operating costs and amounts equivalent to income taxes, costs of property, plant and equipment and regulatory assets in our regulated rates;

• our ability to manage our operations and maintenance costs;

• changes in regulation, including the application of market rates by state and local agencies;

• the economic climate and, particularly, its effect on the natural gas requirements of our residential and commercial industrial customers;

• competition from alternative forms of energy, including , but not limited to, solar power, wind power, geothermal energy and biofuels;

• variations in weather, including seasonal effects on demand, the occurrence of storms and disasters, and climate change;

• indebtedness could make us more vulnerable to general adverse economic and industry conditions, limit our ability to borrow additional funds and/or place us at competitive disadvantage compared with competitors;

• our ability to secure reliable, competitively priced and flexible natural gas supply;

• the mechanical integrity of facilities operated;

• adverse labor relations;

• the effectiveness of our strategies to reduce earnings lag, margin protection strategies and risk mitigation strategies;

• our ability to generate sufficient cash flows to meet all our cash needs;

• changes in the financial markets during the periods covered by the forward-looking statements, particularly those affecting the availability of capital and our ability to refinance existing debt and fund investments and acquisitions;

• actions of rating agencies, including the ratings of debt, general corporate ratings and changes in the rating agencies’ ratings criteria;

• changes in inflation and interest rates;

• our ability to purchase and sell assets at attractive prices and on other attractive terms;

• our ability to recover the costs of natural gas purchased for our customers;

• impact of potential impairment charges;

• volatility and changes in markets for natural gas;

• possible loss of LDC franchises or other adverse effects caused by the actions of municipalities;

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• changes in regulation of natural gas distribution services, particularly those in Oklahoma, Kansas and Texas;

• changes in law resulting from new federal or state energy legislation;

• changes in environmental, safety, tax and other laws to which we and our subsidiaries are subject;

• advances in technology;

• acts of nature and the potential effects of threatened or actual terrorism, including cyber attacks, and war;

• the sufficiency of insurance coverage to cover losses;

• the effects of our strategies to reduce tax payments;

• the effects of litigation and regulatory investigations, proceedings, including our rate cases, or inquiries;

• changes in accounting standards and corporate governance;

• our ability to attract and retain talented management and directors;

• the results of financing efforts, including our ability to obtain financing on favorable terms, which can be affected by various factors, including our credit ratings and general economic conditions;

• declines in the market prices of equity securities and resulting funding requirements for our defined benefit pension plans;

• the ability to successfully complete merger, acquisition or divestiture plans, regulatory or other limitations imposed as a result of a merger, acquisition or divestiture, and the success of the business following a merger, acquisition or divestiture;

• the final resolutions or outcomes with respect to our contingent and other corporate liabilities related to the natural gas distribution business and any related actions for indemnification made pursuant to the Separation and Distribution Agreement;

• our ability to operate effectively as a separate, publicly-traded company;

• the costs associated with becoming compliant with the Sarbanes-Oxley Act of 2002 as a stand-alone company and the consequences of failing to implement effective internal controls over financial reporting as required by Section 404 of the Sarbanes-Oxley Act of 2002 by the date that we must comply with that section of the Sarbanes-Oxley Act; and

• the costs associated with increased regulation and enhanced disclosure and corporate governance requirements pursuant to the Dodd-Frank Wall Street Reform and the Consumer Protection Act of 2010.

In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. We undertake no obligation, except as may otherwise be required by the federal securities laws, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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THE SEPARATION

General

On July 24, 2013, the board of directors of ONEOK unanimously authorized management of ONEOK to pursue a plan to separate its natural gas distribution business from the rest of ONEOK’s businesses into a separate, publicly traded company.

In furtherance of this plan, on                     ,     , ONEOK’s board of directors approved the distribution of all the shares of our common stock to holders of ONEOK common stock. The distribution of the shares of our common stock will take place immediately following the separation. On the distribution date, each holder of ONEOK common stock will receive                  shares of our common stock for each share of ONEOK common stock held at the close of business on the record date, as described below. Following the distribution, ONEOK shareholders will directly own all of our common stock.

You will not be required to make any payment, surrender or exchange your shares of ONEOK common stock or take any other action to receive your shares of our common stock in the distribution.

The distribution of our common stock as described in this Information Statement is subject to the satisfaction or waiver of certain conditions, including regulatory approvals and the final approval of ONEOK’s board of directors. We cannot provide any assurances that the distribution will be completed. For a more detailed description of these conditions, see the section entitled “—Conditions to the Distribution.”

The Number of Shares You Will Receive

For each share of ONEOK common stock that you owned at the close of business on                     ,     , the record date, you will receive                  share(s) of our common stock on the distribution date. ONEOK will not distribute any fractional shares of our common stock to its shareholders. Instead, the transfer agent will aggregate fractional shares into whole shares, sell the whole shares in the open market at prevailing market prices and distribute the aggregate net cash proceeds of the sales pro rata to each holder of ONEOK Common Stock who otherwise would have been entitled to receive a fractional share in the distribution. Recipients of cash in lieu of fractional shares will not be entitled to any interest on the amounts of payment made in lieu of fractional shares.

When and How You Will Receive the Distributed Shares

ONEOK will distribute the shares of our common stock on or before                     ,     , the distribution date. Wells Fargo Bank, N.A. will serve as transfer agent and registrar for our common stock and as distribution agent in connection with the distribution.

If you own ONEOK common stock as of the close of business on the record date, the shares of our common stock that you are entitled to receive in the distribution will be issued electronically, as of the distribution date, to you or to your bank or brokerage firm on your behalf by way of direct registration in book-entry form. Registration in book-entry form refers to a method of recording stock ownership when no physical share certificates are issued to shareholders, as is the case in this distribution.

If you sell shares of ONEOK common stock in the “regular-way” market prior to the distribution date, you will be selling your right to receive shares of our common stock in the distribution. For more information please see the section entitled “—Trading Between the Record Date and Through the Distribution Date.”

Commencing on or shortly after the distribution date, if you hold physical stock certificates that represent your shares of ONEOK common stock and you are the registered holder of the ONEOK shares represented by

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those certificates, the distribution agent will mail to you an account statement that indicates the number of shares of our common stock that have been registered in book-entry form in your name. If you have any questions concerning the mechanics of having shares of our common stock registered in book-entry form, we encourage you to contact Wells Fargo Bank, N.A. at the address and telephone number set forth on page 21 of this Information Statement.

Most ONEOK shareholders hold their shares of ONEOK common stock through a bank or brokerage firm. In such cases, the bank or brokerage firm would be said to hold the stock in “street name” and ownership would be recorded on the bank’s or brokerage firm’s books. If you hold your ONEOK common stock through a bank or brokerage firm, your bank or brokerage firm will credit your account for the shares of our common stock that you are entitled to receive in the distribution. If you have any questions concerning the mechanics of having shares of our common stock held in “street name,” we encourage you to contact your bank or brokerage firm.

Wells Fargo Bank, N.A., as distribution agent, will not deliver any fractional shares of our common stock in connection with the distribution. Instead, Wells Fargo Bank, N.A. will aggregate all fractional shares and sell the shares in the open market at prevailing market prices on behalf of the holders who otherwise would be entitled to receive fractional shares. The aggregate net cash proceeds of these sales, which generally will be taxable for U.S. federal income tax purposes, will be distributed pro rata (based on the fractional shares such holder would otherwise be entitled to receive) to each holder who otherwise would have been entitled to receive a fractional share in the distribution. For more information on the tax consequences, please see the section entitled “—Certain U.S. Federal Income Tax Consequences of the Distribution” below for an explanation of the tax consequences of the distribution. If you physically hold ONEOK common stock certificates and are the registered holder, you will receive a check from the distribution agent in an amount equal to your pro rata share of the aggregate net cash proceeds of the sales. We estimate that it will take approximately two weeks from the distribution date for the distribution agent to complete the distributions of the aggregate net cash proceeds. If you hold your ONEOK stock through a bank or brokerage firm, your bank or brokerage firm will receive on your behalf your pro rata share of the aggregate net cash proceeds of the sales and will electronically credit your account for you.

Results of the Separation

After the distribution, we will be a separate publicly-traded company. Immediately following the distribution, we expect to have approximately                      shareholders of record, based on the number of registered shareholders of ONEOK common stock on             ,         , and approximately                  shares of our common stock outstanding. The actual number of shares to be distributed will be determined on the record date. We do not currently have and, immediately following the distribution, we do not expect to have any outstanding stock options or warrants to purchase common stock, and the number of shares does not include any such options or warrants.

Before the distribution, we will enter into the Separation and Distribution Agreement and several other agreements with ONEOK to effect the separation and provide a framework for our relationships with ONEOK after the distribution. These agreements will govern the relationship among us and ONEOK subsequent to the completion of the distribution and provide for the allocation between us and ONEOK, of the assets, liabilities and obligations (including employee benefits and tax-related assets and liabilities) relating to the natural gas distribution business attributable to periods prior to, at and after the distribution. For a more detailed description of these agreements, see the section entitled “Certain Relationships and Related-Party Transactions.”

The distribution will not affect the number of outstanding shares of ONEOK common stock or any rights of ONEOK shareholders.

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Direct Stock Purchase and Dividend Reinvestment Plan; Employee Benefit Plans

For employees who hold shares of ONEOK’s common stock in ONEOK’s Direct Stock Purchase and Dividend Reinvestment Plan, Employee Stock Purchase Plan or the Employee Stock Award Program, the shares of our common stock such employees are entitled to receive in the distribution will be deposited to their shareholder accounts at Wells Fargo Shareholder Services in book-entry form.

For employees who hold shares of ONEOK’s common stock in ONEOK’s Thrift Plan for Employees of ONEOK, Inc. and Subsidiaries or the Profit-Sharing Plan, the shares of our common stock such employees are entitled to receive in the distribution will be distributed to their account under each of those plans.

Incurrence of Debt

In connection with the separation, we expect that we will receive approximately $1.19 billion of cash from the issuance of debt securities, and we expect to make a cash payment of approximately $1.13 billion to ONEOK from the expected proceeds of these debt securities, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures. The amount to be paid to ONEOK was determined after consideration of several factors, including the resulting capital structures, anticipated credit ratings and existing levels of debt at both ONEOK and ONE Gas. Our capital structure was designed to obtain investment grade credit ratings that are higher than the current credit ratings of ONEOK and similar to those of our natural gas utility peers and to provide us with the financial flexibility to maintain our current level of operations and to continue to invest in our natural gas distribution system. We do not expect the incurrence of approximately $1.2 billion of debt to negatively impact our financial flexibility or our ability to invest in rate base and pay dividends pursuant to our dividend policy. The amount to be paid to ONEOK is expected to allow ONEOK to reduce its existing debt and obtain credit ratings similar to or higher than its general partner peers. The tax basis of the net assets to be transferred to ONE Gas was also considered because the amount distributed to ONEOK in excess of such tax basis would generally be subject to income tax unless more complex financing arrangements were entered into.

The amount to be paid to ONEOK and the amount, type and term of the debt securities we will issue have not yet been determined but will be determined prior to the separation. A number of factors could affect this final determination, and the amount of debt securities ultimately issued could be different from the amount disclosed in this Information Statement.

Additionally, we have entered into a $700 million revolving credit facility and intend to enter into a commercial paper program to support our working capital and general corporate needs and normal course of business requirements after the separation.

ONEOK has informed us that the approximately $1.13 billion of cash proceeds it receives from us, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, will be used to repay outstanding ONEOK debt and/or repurchase ONEOK shares or pay dividends with respect to ONEOK shares, in each case within 18 months following the distribution.

Certain U.S. Federal Income Tax Consequences of the Distribution

The following discussion summarizes certain U.S. federal income tax consequences to holders of ONEOK common stock as a result of the distribution. This discussion is based on the Code, the Treasury regulations promulgated under the Code and interpretations of such authorities by the courts and the IRS, all as in effect as of the date of this document and all of which are subject to change at any time, possibly with retroactive effect. This section is limited to holders of ONEOK common stock that are U.S. holders, as defined below, that hold their shares of ONEOK common stock as capital assets, within the meaning of the Code. Further, this section does not discuss all tax considerations that may be relevant to holders of ONEOK common stock in light of their particular circumstances, nor does it address the consequences to holders of ONEOK common stock subject to special treatment under the U.S. federal income tax laws, such as tax-exempt entities, partnerships (including

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entities treated as partnerships for U.S. federal income tax purposes), persons who acquired their shares of ONEOK common stock pursuant to the exercise of employee stock options or otherwise as compensation, financial institutions, insurance companies, dealers or traders in securities, and persons who hold their shares of ONEOK common stock as part of a straddle, hedge, conversion, constructive sale, synthetic security, integrated investment or other risk-reduction transaction for U.S. federal income tax purposes. This section does not address any U.S. federal estate, gift or other non-income tax consequences or any state, local or foreign tax consequences.

Holders of ONEOK common stock are urged to consult with their tax advisors as to the particular tax consequences to them of the distribution.

For purposes of this section, a U.S. holder is a beneficial owner of ONEOK common stock that is, for U.S. federal income tax purposes:

• an individual who is a citizen or a resident of the United States;

• a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized under the laws of the United States or any state or political subdivision thereof;

• an estate, the income of which is subject to United States federal income taxation regardless of its source; or

• a trust, if (1) a court within the United States is able to exercise primary jurisdiction over its administration and one or more U.S. persons have the authority to control all of its substantial decisions, or (2) it has a valid election in place under applicable Treasury regulations to be treated as a U.S. person.

If a partnership (including any entity treated as a partnership for U.S. federal income tax purposes) holds shares of ONEOK common stock, the tax treatment of a partner in the partnership generally will depend upon the status of the partner and the activities of the partnership. A partner of a partnership holding shares of ONEOK common stock should consult its tax advisor regarding the tax consequences of the distribution to such partner.

General

ONEOK has received the IRS Ruling to the effect that the distribution, together with certain related transactions, will qualify as a tax-free transaction under Sections 355, 368(a)(1)(D) and other related provisions of the Code and that, accordingly, for U.S. federal income tax purposes, among other things:

• no gain or loss will be recognized by ONEOK upon the distribution of shares of our common stock to ONEOK shareholders pursuant to the distribution;

• no gain or loss will be recognized by, and no amount will be included in the income of, a ONEOK shareholder upon their receipt of shares of our common stock pursuant to the distribution;

• a ONEOK shareholder who receives shares of our common stock in the distribution will have an aggregate adjusted tax basis in its shares of our common stock (including any fractional shares deemed received) and common stock of ONEOK following the distribution equal to the aggregate basis of the ONEOK stock that the shareholder held immediately before the distribution, allocated between our stock and the stock of ONEOK in proportion to the fair market value of each; and

• the holding period of the shares of our common stock received in the distribution by a ONEOK shareholder will include the holding period of such shareholder’s shares of ONEOK common stock.

A ONEOK shareholder who receives cash in lieu of a fractional share of our stock will be treated as though such shareholder first received a distribution of a fractional share in the distribution, and then sold it for the amount of cash actually received. Such holder will recognize capital gain or loss, provided that the fractional share is considered to be held as a capital asset, measured by the difference between the cash received for such

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fractional share and the holder’s basis in the fractional share, as determined above. Such capital gain or loss will generally be a long-term capital gain or loss if the holder’s holding period for its ONEOK common stock exceeds one year on the date of the distribution. The deductibility of capital losses is subject to significant limitations.

ONEOK shareholders that have acquired different blocks of ONEOK common stock at different times or at different prices should consult their tax advisors regarding the allocation of their aggregate adjusted basis among, and their holding period of, shares of our common stock distributed with respect to such blocks of ONEOK common stock.

Although the IRS Ruling is generally binding on the IRS, the continued validity of the ruling is subject to the accuracy of factual statements and representations made to the IRS by ONEOK upon which the ruling is based. Further, as a result of the IRS’s general ruling policy with respect to transactions under Section 355 of the Code, the ruling does not represent a determination by the IRS that certain requirements necessary to obtain tax-free treatment to holders of ONEOK common stock and to ONEOK under Sections 355, 368(a)(1)(D) and other related provisions of the Code (specifically, the corporate business purpose requirement, the requirement that the distribution not be used principally as a device for the distribution of earnings and profits, and the non-application of Section 355(e) of the Code to the distribution (discussed below)) have been satisfied. Rather, the ruling is based upon representations made to the IRS by ONEOK that these requirements have been satisfied. If any of the statements or representations upon which the IRS Ruling is based are incorrect or untrue in any material respect, or the facts upon which the ruling is based were materially different from the facts at the time of the distribution, such ruling could be invalidated.

As a result of the IRS’s general ruling policy, the distribution is also conditioned upon the receipt by ONEOK of the opinion of Skadden, tax counsel to ONEOK, in form and substance reasonably acceptable to ONEOK, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling. The opinion of counsel will rely on the continued validity of the IRS Ruling, as to the matters covered by such ruling, and will be based upon certain assumptions, as well as statements, representations and certain undertakings made by our officers and officers of ONEOK, as requested by counsel. These assumptions, statements, representations and undertakings are expected to relate to, among other things, ONEOK’s business reasons for engaging in the distribution and our and ONEOK’s current plans and intentions to continue conducting our business activities and not to materially modify our respective ownership or capital structures, in each case following the distribution. If the IRS Ruling is no longer valid, if any of those statements, representations or assumptions is incorrect or untrue in any material respect or any of those undertakings is not complied with, or if the facts upon which the opinion is based are materially different from the facts at the time of the distribution, the conclusions reached in such opinion could be adversely affected. Opinions of counsel are not binding on the IRS or the courts, and the conclusions expressed in such opinion could be challenged by the IRS, and a court could sustain such challenge, in which case the tax consequences to you could be materially less favorable.

If the distribution does not qualify for tax-free treatment for U.S. federal income tax purposes, then, in general, ONEOK would be subject to tax as if it had sold our common stock in a taxable sale for its fair market value. In addition, ONEOK could incur significant additional tax liability with respect to certain related transactions. Moreover, ONEOK’s shareholders would be subject to tax as if they had received a taxable distribution equal to the fair market value of our common stock that was distributed to them, taxable as a dividend to the extent of ONEOK’s earnings and profits. The amount of the taxable distribution in excess of ONEOK’s earnings and profits would result first in a non-taxable dollar-for-dollar reduction in the shareholder’s basis in its ONEOK stock, and thereafter would be treated as capital gain from the sale or exchange of such shareholder’s ONEOK stock. It is expected that the amount of any such taxes to ONEOK’s shareholders and ONEOK would be substantial. Depending on the circumstances, we may be required to indemnify ONEOK for any resulting taxes and related expenses, which amounts could be material. Please see “Certain Relationships and Related Party Transactions—Agreements with ONEOK—Tax Matters Agreement” for a more detailed discussion of the Tax Matters Agreement between us and ONEOK.

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Even if the distribution otherwise qualifies under Sections 355, 368(a)(1)(D) and other related provisions of the Code, the distribution would result in a significant U.S. federal income tax liability to ONEOK (but not to holders of ONEOK common stock) under Section 355(e) of the Code if one or more persons acquire a 50-percent or greater interest (measured by vote or value) in the stock of ONEOK or in our stock as part of a plan or series of related transactions that includes the distribution. Current tax law generally creates a presumption that any acquisition of the stock of ONEOK or our stock within two years before or after the distribution is part of a plan that includes the distribution, although the parties may be able to rebut that presumption. The process for determining whether an acquisition is part of a plan under these rules is complex, inherently factual and subject to an analysis of the facts and circumstances of a particular case. Notwithstanding the IRS Ruling or the opinion of counsel described above, we or ONEOK might inadvertently cause or permit a prohibited change in our ownership or ONEOK’s ownership to occur, thereby triggering tax liability to ONEOK. If the distribution is determined to be taxable to ONEOK under Section 355(e), ONEOK would recognize gain as described above. Depending on the circumstances, we may be required to indemnify ONEOK for any resulting taxes and related expenses, which amounts could be material. Please see “Certain Relationships and Related-Party Transactions—Agreements with ONEOK—Tax Matters Agreement” for a more detailed discussion of the Tax Matters Agreement between us and ONEOK. The distribution would, however, generally be tax-free to each holder of ONEOK common stock who received shares of our common stock in the distribution (except for the receipt of cash in lieu of fractional shares).

THE FOREGOING IS A SUMMARY OF CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE DISTRIBUTION UNDER CURRENT LAW AND IS FOR GENERAL INFORMATION ONLY. THE FOREGOING DOES NOT PURPORT TO ADDRESS ALL U.S. FEDERAL INCOME TAX CONSEQUENCES OR TAX CONSEQUENCES THAT MAY ARISE UNDER THE TAX LAWS OF OTHER JURISDICTIONS OR THAT MAY APPLY TO PARTICULAR CATEGORIES OF SHAREHOLDERS. EACH ONEOK SHAREHOLDER SHOULD CONSULT ITS TAX ADVISOR AS TO THE PARTICULAR TAX CONSEQUENCES OF THE DISTRIBUTION TO SUCH SHAREHOLDER, INCLUDING THE APPLICATION OF U.S. FEDERAL, STATE, LOCAL AND FOREIGN TAX LAWS, AND THE EFFECT OF POSSIBLE CHANGES IN TAX LAWS THAT MAY AFFECT THE TAX CONSEQUENCES OF THE DISTRIBUTION DESCRIBED ABOVE.

Market for Common Stock

There is currently no public market for our common stock. A condition to the distribution is the listing on the NYSE of our common stock. Prior to the distribution, we intend to apply to list our common stock on the NYSE under the ticker symbol “OGS”.

Trading Between the Record Date and Through the Distribution Date

Beginning on or shortly before the record date and continuing up to and through the distribution date, we expect that there will be two markets in ONEOK common stock: a “regular-way” market and an “ex-distribution” market. Shares of ONEOK common stock that trade on the regular way market will trade with an entitlement to shares of our common stock distributed pursuant to the distribution. Shares that trade on the “ex-distribution” market will trade without an entitlement to shares of our common stock distributed pursuant to the distribution. Therefore, if you own shares of ONEOK common stock at the close of business on the record date, and you sell those shares of ONEOK common stock in the “regular-way” market on or before the distribution date, you will be selling your right to receive shares of ONE Gas common stock in the distribution. If you own shares of ONEOK common stock at the close of business on the record date and sell those shares on the “ex-distribution” market on or before the distribution date, you will still receive the shares of our common stock that you would be entitled to receive pursuant to your ownership of the shares of ONEOK common stock on the record date.

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Furthermore, beginning on or shortly before the record date and continuing up to and through the distribution date, we expect that there will be a “when-issued” market on the NYSE in our common stock. “When-issued” trading refers to a sale or purchase made conditionally because the security has been authorized but not yet issued. The “when-issued” trading market will be a market for shares of our common stock that will be distributed to ONEOK shareholders on the distribution date. If you owned shares of ONEOK common stock at the close of business on the record date, you would be entitled to shares of our common stock distributed pursuant to the distribution. You may trade this entitlement to shares of our common stock, without trading the shares of ONEOK common stock you own, on the “when-issued” market. On the first trading day following the distribution date, “when issued” trading with respect to our common stock will end and “regular-way” trading on the NYSE will begin.

Conditions to the Distribution

We expect that the distribution will be effective immediately following the separation, provided that, among other conditions described in this Information Statement, the following conditions shall have been satisfied or, if permissible under the Separation and Distribution Agreement, waived by ONEOK:

• the SEC, shall have declared effective our registration statement on Form 10, of which this Information Statement is a part, under the Exchange Act, and no stop order relating to the registration statement shall be in effect, and this Information Statement shall have been mailed to the holders of ONEOK’s common stock;

• ONEOK shall have received a surplus and solvency opinion from a nationally recognized valuation firm, in form and substance satisfactory to ONEOK, with respect to whether ONEOK should have adequate surplus to declare the distribution dividend and that, following the separation and distribution, each of ONEOK and ONE Gas should be solvent and adequately capitalized;

• all required federal, state and municipal approvals (including approval of the Kansas Corporation Commission) and consents necessary to consummate the separation and distribution shall have been received;

• we shall have received approximately $1.19 billion of cash from the issuance of debt securities and shall have made a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures;

• The IRS Ruling received by ONEOK shall not have been withdrawn, invalidated or modified in an adverse manner, and ONEOK shall have received the opinion of Skadden, tax counsel to ONEOK, which opinion will rely on the continued validity of the IRS Ruling, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling;

• the listing of our common stock on the NYSE shall have been approved, subject to official notice of issuance;

• no order, injunction or decree issued by any court of competent jurisdiction or other legal restraint or prohibition preventing consummation of the distribution or any of the transactions related thereto, including the debt financing, the transfers of assets and liabilities contemplated by the Separation and Distribution Agreement shall be in effect; and

• the board of directors of ONEOK shall have approved the distribution, which may be given or withheld in its absolute and sole discretion.

The fulfillment of the foregoing conditions does not create any obligation on ONEOK’s part to effect the distribution, and the ONEOK board of directors has reserved the right, in its sole discretion, to amend, modify or abandon the distribution and related transactions at any time prior to the distribution date. ONEOK has the right not to complete the distribution if, at any time, the ONEOK board of directors determines, in its sole discretion, that the distribution is not in the best interests of ONEOK or its shareholders or that market conditions are such that it is not advisable to separate the natural gas distribution business from ONEOK.

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Transferability of Shares of Our Common Stock

The shares of our common stock that you will receive in the distribution will be freely transferable, unless you are considered an “affiliate” of ours under Rule 144 under the Securities Act. Persons who can be considered our affiliates after the distribution generally include individuals or entities that directly, or indirectly through one or more intermediaries, control, are controlled by or are under common control with us, and may include certain of our officers and directors. We estimate that our directors and officers, who may be considered “affiliates” for purposes of Rule 144, will beneficially own approximately                  shares of our common stock immediately following the distribution. See the section entitled “Security Ownership of Certain Beneficial Owners and Management” for more information.

Our affiliates may sell shares of our common stock received in the distribution only:

• under a registration statement that the SEC has declared effective under the Securities Act; or

• under an exemption from registration under the Securities Act, such as the exemption afforded by Rule 144.

In general, under Rule 144 as currently in effect, an affiliate will be entitled to sell, within any three-month period commencing 180 days after the date the registration statement of which this information statement is a part is declared effective, a number of shares of our common stock that does not exceed the greater of:

• 1.0 percent of our common stock then outstanding; or

• the average weekly trading volume of our common stock during the four calendar weeks preceding the filing of a notice on Form 144 for the sale.

Rule 144 also includes restrictions governing the manner of sale. Sales may not be made under Rule 144 unless certain information about us is publicly available.

Regulatory Approvals Necessary to Effect the Separation

On December 19, 2013, we received the requisite approval of the separation by the KCC.

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Corporate Structure

Set forth below are simplified diagrams of ONEOK prior to the distribution and of ONEOK and us after the distribution. Not all subsidiaries and businesses are shown.

Pre-Distribution

Post-Distribution

Reasons for the Separation

The ONEOK board of directors regularly reviews ONEOK’s various businesses to ensure that ONEOK’s resources are being put to use in a manner that is in the best interests of ONEOK and its shareholders. ONEOK believes that the separation of the natural gas distribution business is the best way to unlock the value of

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ONEOK’s businesses in both the short- and long-term and provides each of ONEOK and us with certain opportunities and benefits. ONEOK’s board of directors considered various factors and potential benefits in approving the separation transaction, including its belief that the separation will:

• enhance strategic, financial and operating flexibility, and the growth potential of both entities;

• increase transparency of each company;

• better align the businesses with each company’s relevant peer groups;

• attract more focused equity investors to each company;

• sharpen each company’s focus on its distinct strategic goals;

• resolve internal competition for capital among the businesses that is inherent in the existing structure; and

• enhance dividends and shareholder returns.

Neither we nor ONEOK can assure you that, following the distribution, any of these benefits will be realized to the extent anticipated or at all. In addition, in evaluating the separation, the ONEOK board of directors evaluated factors that could negatively affect the transaction, including the risk that the separation would not be executed successfully and the risk that ONEOK or ONEOK’s shareholders would be required to pay U.S. federal income taxes as a result of the separation. For additional information about these and other risks related to the separation, please see the section entitled “Risk Factors—Risks Relating to the Separation” on page 36.

In view of the wide variety of factors considered in connection with the evaluation of the separation and the complexity of these matters, ONEOK’s board of directors did not find it useful to, and did not attempt to, quantify, rank or otherwise assign relative weights to the factors considered. The individual members of ONEOK’s board of directors likely may have given different weights to different factors.

Reason for Furnishing this Information Statement

This Information Statement is being furnished solely to provide information to ONEOK shareholders who are entitled to receive shares of our common stock in the distribution. This Information Statement is not, and is not to be construed as, an inducement or encouragement to buy, hold or sell any of our securities or securities of ONEOK. We believe that the information in this Information Statement is accurate in all material respects as of the date set forth on the cover. Changes may occur after that date and, except as may be required by the federal securities laws, neither ONEOK nor we undertake any obligation to update such information.

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DIVIDEND POLICY

Following the separation, we expect to establish a dividend payout ratio target, which reflects the percentage of our recurring earnings expected to be paid as dividends, that is competitive with our natural gas utility peers. The board of directors of ONEOK has historically declared quarterly dividends. Following the distribution, we anticipate that our board of directors will establish dividend practices that will be independent of ONEOK’s historic dividend practices. We expect to recommend to our board of directors a dividend payout ratio target in the range of 55 percent to 65 percent of our recurring earnings. The declaration and payment of any dividends in the future by us will be subject to the sole discretion of our board of directors and will depend upon many factors, including our financial condition, earnings, capital requirements, covenants associated with certain of our debt obligations, which may include maintaining certain debt to capital ratios, legal requirements, regulatory constraints and other factors deemed relevant by our board of directors.

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CAPITALIZATION

The following table presents ONE Gas Predecessor’s historical cash and cash equivalents and capitalization at September 30, 2013, and our unaudited pro forma cash and cash equivalents and capitalization at that date reflecting the following transaction as if it had occurred on September 30, 2013:

• The internal reorganization of ONEOK’s corporate structure by means of transfers of all of the assets and liabilities of the natural gas distribution business to us.

The pro forma adjustments reflect the expected effects of these events that are directly attributable to the separation and related transactions and are factually supportable. The data in the following table should be read together with “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements.”

	As of September 30, 2013
	ONE Gas Predecessor		ONE Gas Pro Forma
	(in thousands)
Cash and cash equivalents	$	2,682	$	2,682
Current maturities of long-term debt	$	149	$	149
Short-term note payable to ONEOK*		342,364		342,364
Long-term debt, excluding current maturities*		1,319		1,319
Long-term line of credit with ONEOK*		1,027,631		1,027,631
Total debt		1,371,463		1,371,463
Total equity		1,203,326		1,292,203
Total capitalization	$	2,574,789	$	2,663,666

* The pro forma balances do not reflect the following transactions which we expect will occur prior to the separation:

• ONEOK’s contribution to our capital of all of our short-term note payable to and long-term line of credit with ONEOK outstanding immediately prior to the contribution of the natural gas distribution business to us.

• The receipt of approximately $1.19 billion of cash from our expected issuance of debt securities as the debt agreements are not expected to be executed prior to effectiveness of the registration statement of which this information statement is a part.

• The cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures. ONEOK has informed us that it expects to use the cash proceeds it receives from us to repay outstanding ONEOK debt and/or repurchase ONEOK shares or pay dividends with respect to ONEOK shares, in each case within 18 months following the distribution.

See footnote 2(f) of the “Notes to Unaudited Pro Forma Financial Statements” included elsewhere in this Information Statement for more information.

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SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA

The following table sets forth the selected historical financial data for the periods indicated below. The selected historical unaudited financial data for the nine months ended September 30, 2013 and 2012, and balance sheet data as of September 30, 2013, have been derived from ONE Gas Predecessor’s unaudited financial statements included elsewhere in this Information Statement. Our Predecessor consists of the business attributable to ONEOK’s Natural Gas Distribution segment that will be transferred to us in connection with the separation. The unaudited financial statements have been prepared on the same basis as the Predecessor’s audited financial statements, and include all normal recurring adjustments that, in the opinion of management, are necessary to present fairly the financial condition and results of operations for such periods. The results of operations for the nine months ended September 30, 2013, presented below are not necessarily indicative of results for the entire fiscal year. The selected historical financial data as of December 31, 2012 and 2011, and for the years ended December 31, 2012, 2011 and 2010, have been derived from our Predecessor’s audited historical financial statements included elsewhere in this Information Statement. The selected historical financial data as of September 30, 2012, and December 31, 2010, 2009 and 2008, and for the years ended December 31, 2009 and 2008, have been derived from the unaudited accounting records of our Predecessor, which are not included in this Information Statement. The historical financial statements included in this Information Statement may not necessarily reflect our financial position, results of operations and cash flows as if we had operated as a stand-alone public company during all periods presented. Accordingly, our historical results should not be relied upon as an indicator of our future performance.

The selected unaudited pro forma financial data presented in the following table as of and for the nine months ended September 30, 2013, and the year ended December 31, 2012, are derived from the unaudited pro forma financial data included elsewhere in this Information Statement. The unaudited pro forma balance sheet data give effect to the separation as if it had occurred on September 30, 2013. The unaudited pro forma statements of income data give effect to the separation as if it had occurred on January 1, 2012. The unaudited pro forma financial data are for illustrative purposes only, and do not reflect what our financial position and results of operations would have been had the separation occurred on the dates indicated and are not necessarily indicative of our future financial position and future results of operations.

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The following selected historical and unaudited pro forma financial data should be read in conjunction with “Capitalization,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Certain Relationships and Related-Party Transactions—Agreements with ONEOK” and our financial statements and related notes included elsewhere in this Information Statement.

	ONE Gas Predecessor Historical																					ONE Gas Pro Forma
	Years Ended December 31,															Nine Months Ended September 30,						Nine Months Ended September 30,			Year Ended December 31,
	2012			2011			2010			2009			2008			2013			2012			2013			2012
	(Millions of dollars)
Statement of income data:
Revenues	$	1,376.6		$	1,621.3		$	1,817.4		$	1,838.9		$	2,175.7		$	1,167.3		$	943.9		$	1,167.3		$	1,376.6
Net margin		756.4			751.8			754.9			716.0			681.0			589.4			545.8			589.4			756.4
Operating costs		410.5			419.9			398.3			383.2			375.4			334.0			310.8			334.0			410.5
Depreciation and amortization		130.2			132.2			131.0			122.6			116.8			100.1			97.5			100.1			130.2
Operating income		215.7			199.7			225.6			210.2			188.8			155.3			137.5			155.3			215.7
Interest expense*		(60.8	)		(54.1	)		(52.3	)		(66.4	)		(72.6	)		(45.7	)		(45.3	)		(45.7	)		(60.8	)
Income taxes		(59.9	)		(56.0	)		(67.1	)		(65.8	)		(39.6	)		(42.7	)		(35.7	)		(42.7	)		(59.9	)
Net income		96.5			86.8			106.4			80.7			66.7			68.9			57.9			68.9			96.5
Earnings per share**:
Basic
Diluted
	December 31,															September 30,						September 30,
	2012			2011			2010			2009			2008			2013						2013
	(Millions of dollars)
Balance sheet data:
Total assets	$	3,491.3		$	3,285.5		$	3,095.1		$	3,054.4		$	3,161.2		$	3,572.1					$	3,932.6
Long-term line of credit with ONEOK*		1,027.6			912.4			756.4			735.4			937.9			1,027.6						1,027.6
Long-term debt, including current maturities*		1.5			1.9			2.2			2.4			2.7			1.5						1.5

* Pro forma long-term line of credit with ONEOK does not reflect ONEOK’s expected contribution of such amounts to our capital, and pro forma long-term debt does not reflect the expected issuance of approximately $1.2 billion of debt securities as such issuance is not expected to occur prior to effectiveness of the registration statement of which this information statement is a part. Pro forma interest expense does not reflect the elimination of affiliate interest expense on amounts payable to ONEOK that are expected to be contributed to our capital and incurrence of interest expense on third-party debt expected to be issued prior to the separation. See footnote 2(f) of the “Notes to Unaudited Pro Forma Financial Statements” included elsewhere in this Information Statement for more information.

** Historical earnings per share are not presented because we did not have common stock that was part of our capital structure for the periods presented. The calculation of pro forma basic net income per share is calculated by dividing the pro forma net income by the weighted average number of shares of ONEOK common stock outstanding for the periods indicated, adjusted for an assumed distribution ratio of              shares of our common stock for each share of ONEOK common stock outstanding. The calculation of pro forma diluted net income per share is calculated by dividing the pro forma net income by the weighted average number of shares of ONEOK common stock outstanding and diluted shares of common stock outstanding for the periods indicated, adjusted for the same distribution ratio. This calculation may not be indicative of the dilutive effect that will actually result from share-based awards subsequently transferred to or granted by ONE Gas.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

Introduction

ONE Gas is a wholly owned subsidiary of ONEOK. Following the separation, ONE Gas will be an independent, publicly traded company, and ONEOK will not retain any ownership interest in our company. ONE Gas will not have material assets or liabilities as a separate corporate entity until the contribution to ONE Gas by ONEOK of the business described in this Information Statement. The historical financial data has been derived from ONE Gas Predecessor’s financial statements. Our Predecessor consists of the business that ONEOK attributes to its natural gas distribution business which is located in Oklahoma, Kansas and Texas. The separation will occur through the following steps:

• the “reorganization,” which is the corporate reorganization in which ONEOK will transfer all of the assets and liabilities primarily related to its natural gas distribution business to ONE Gas. These assets and liabilities include accounts receivable and payable, natural gas in storage, regulatory assets and liabilities, pipeline and other natural gas distribution facilities, customer deposits, employee-related assets and liabilities including amounts attributable to pension and other postretirement benefits, tax-related assets and liabilities and other assets and liabilities primarily associated with providing natural gas distribution service in Oklahoma, Kansas and Texas. Cash and certain corporate assets, such as office space in the corporate headquarters and certain IT hardware and software, will not be transferred to ONE Gas; however, the Transition Services Agreement between ONEOK and ONE Gas will provide ONE Gas with access to such corporate assets as necessary to operate its business for a period of time to enable ONE Gas to obtain the applicable corporate assets.

As part of the reorganization, (1) immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all of the amounts outstanding on our short-term note payable to and long-term line of credit with ONEOK, (2) ONE Gas expects to receive approximately $1.19 billion of cash from the issuance of debt securities, and (3) ONE Gas expects to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, followed by

• the “distribution,” which is the distribution to ONEOK’s shareholders of all of our shares of common stock.

Following the contribution of these assets and liabilities to us, ONE Gas will operate our business as a stand-alone natural gas distribution company.

Following the separation, we will provide natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service. We will serve residential, commercial, industrial and transportation customers in all three states. In addition, the natural gas distribution companies will serve wholesale and public authority customers. Revenues from residential, commercial, industrial, wholesale and public authority customers reflect natural gas sales to these customers, which includes the fixed customer charge, delivery charge and charges for riders, surcharges and other regulatory mechanisms associated with the services we provide, and the recovery of the cost of natural gas delivered. Revenues from transportation customers reflect the fixed customer charge and delivery charge associated with the natural gas delivered to the customer. Other revenues include various customer service charges such as service initiation and connection fees, late-payment and collection charges, and other miscellaneous revenues and fees.

The following discussion should be read in conjunction with the selected historical financial data and the financial statements and the related notes included elsewhere in this Information Statement. The matters discussed below may contain forward-looking statements that reflect our plans, estimates and beliefs. Our actual

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results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed below and elsewhere in this Information Statement, particularly in “Risk Factors” and “Forward-Looking Statements.”

Basis of Presentation

The financial statements for our Predecessor have been derived from ONEOK’s historical financial records which include the natural gas distribution business as if our Predecessor had been a separate company for all periods presented. The assets and liabilities in the financial statements included in this Information Statement have been reflected on a historical basis, as immediately prior to the separation all of the assets and liabilities presented are wholly owned by ONEOK and are being transferred within the ONEOK consolidated group. The financial statements also include expense allocations for certain corporate functions historically performed by ONEOK, including allocations of general corporate expenses related to executive oversight, accounting, treasury, tax, legal and information technology. We believe our assumptions underlying the financial statements, including the assumptions regarding the allocation of general corporate expenses from ONEOK, are reasonable. However, the financial statements may not include all of the actual expenses that would have been incurred by us and may not reflect our results of operations, financial position and cash flows had we been a separate publicly-traded company during the periods presented.

ONE Gas will enter into a Transition Services Agreement with ONEOK that will provide for continuation of some of the corporate functions historically performed by ONEOK in exchange for fees specified in these agreements. See “Certain Relationships and Related-Party Transactions—Agreements with ONEOK—Transition Services Agreement.”

Executive Overview

We are a regulated natural gas utility. As such, our regulators determine the rates we are allowed to charge for our service based on our revenue requirements needed to achieve our authorized rates of return. We earn revenues from the delivery of natural gas, but do not earn a profit on the natural gas that we deliver as those costs are passed through to our customers at cost. The primary components of our revenue requirements are the amount of capital invested in our business, which is also known as rate base, our allowed rate of return on our capital investments and our recoverable operating expenses, including depreciation and income taxes. Our rates have both a fixed and a variable component, with approximately 70 percent and 71 percent of our natural gas sales net margin in 2012 and the first nine months of 2013, respectively, derived from fixed monthly charges to our customers. The variable component of our rates is dependent on the consumption of natural gas, which is impacted primarily by the weather and, to a lesser extent, economic activity. While we have weather normalization mechanisms in most jurisdictions, which adjust customers’ bills when the actual heating degree days differ from normalized heating degree days, these mechanisms are in place for only a portion of the year and do not offset all fluctuations in usage resulting from weather variability. Accordingly, the weather can have either a positive or negative impact on our financial performance. For further information, please see the section entitled “Business—Regulatory Overview.”

Our financial performance is thus contingent on a number of factors, including (1) regulatory outcomes, which dictate the returns we are authorized to earn and the rates we are allowed to charge for our service, (2) the performance of the financial markets, which influences the rates of return authorized by our regulators, (3) the consumption of natural gas, which impacts the amount of our net margin derived from the variable component of our rates, (4) our operating performance, which impacts our operating expenses, and (5) the perceived value of natural gas relative to other energy sources, particularly electricity, which influences our customers’ choice of natural gas to provide a portion of their energy needs.

We are subject to regulatory requirements for pipeline safety and environmental compliance. These requirements impact our operating expenses and the level of capital expenditures required for compliance.

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Historically, our regulators have allowed recovery of these expenditures. However, we are unable to predict the impact that new regulatory requirements will have on our operating expenses or the level of our capital expenditures. Although we believe our regulators will continue to allow recovery of such expenditures in the future, we cannot be assured of that outcome.

Financial Results And Operating Information

Regulatory Initiatives

Oklahoma—On October 18, 2013, Oklahoma Natural Gas filed a joint application with the Public Utility Division of the OCC to postpone its next rate case, currently required in 2014. The joint stipulation and settlement agreement in support of the application was filed on October 25, 2013. If approved, Oklahoma Natural Gas will file a performance-based rate change application in 2014 and a rate case in 2015 based on a test year consisting of the first four quarters of Oklahoma Natural Gas’ operations as a division of ONE Gas.

In March 2013, Oklahoma Natural Gas filed a PBRC application at the OCC seeking no modification to customers’ base rates. The filing includes a small adjustment to residential, commercial and industrial customers’ monthly charge for energy-efficiency program collections. This filing was approved by the OCC in August 2013.

In July 2012, a joint stipulation settling Oklahoma Natural Gas’ annual PBRC filing was approved by the OCC. The settlement granted a $9.5 million rate increase and modified Oklahoma Natural Gas’ PBRC tariff. The modified tariff narrows the range of allowed ROE to a range of 10.0 percent to 11.0 percent from our previous range of 9.75 percent to 11.25 percent, increases the ROE reflected in any rate increase resulting from a revenue deficiency to 10.5 percent from 10.25 percent, and reduces the number of allowed pro forma adjustments that can be proposed by Oklahoma Natural Gas.

In May 2011, the OCC approved a portfolio of conservation and energy-efficiency programs and authorized recovery of costs and performance incentives. The agreement allows Oklahoma Natural Gas to pursue key energy-efficiency programs and earn up to $1.5 million annually, if program objectives are achieved. In May 2013, the OCC approved the extension of the program to include the years 2014 through 2016, as well as adjustments to rebate amounts and targets that were requested by Oklahoma Natural Gas.

Kansas—In December 2013, the KCC approved a settlement agreement between ONEOK, the staff of the KCC, and the Citizens’ Utility Ratepayer Board for our separation from ONEOK. Among other things, the terms of the settlement agreement include the following:

• Kansas Gas Service shall not change its base rates prior to January 1, 2017. The time limitation on filing a general rate case to change base rates does not preclude Kansas Gas Service from changing rates or tariffs to recover appropriate costs under its current approved riders and tariffs, including its COGR, ACA, WNA, AVTS and GSRS tariffs;

• Kansas Gas Service will expense certain costs associated with ONEOK’s acquisition of Kansas Gas Service in 1997 that previously have been recorded as a regulatory asset and are being amortized and recovered in rates over a 40-year period. As such, we expect to record a noncash charge to income of approximately $10.2 million before taxes in the fourth quarter 2013;

• The level of pension and postretirement benefit costs used to calculate Kansas Gas Service’s Pension and Other Postretirement Benefit Trackers shall be adjusted to $13.6 million from $16.6 million with a corresponding reduction to revenues; and

• ONEOK agrees to make a one-time contribution to 501(c)(3) organizations of $1.2 million to provide financial assistance for weatherization of housing for low income natural gas customers of Kansas Gas Service.

The agreement authorizes the transfer of ONEOK’s existing Kansas natural gas distribution assets, certificates of convenience and necessity, franchises and tariffs to us conditioned upon the completion of the

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separation. Completion of the separation is subject to certain conditions, including final approval from the ONEOK Board of Directors.

In August 2013, Kansas Gas Service filed an application to increase the GSRS by $1.5 million. This surcharge is a capital-recovery mechanism that allows for rate adjustment, providing recovery of and a return on incremental safety-related and government-mandated capital investments made between rate cases. Staff of the KCC issued its report and recommendation that the application be approved as filed. The KCC is expected to make a final ruling by December 2013.

In October 2012, Kansas Gas Service, the staff of the KCC and the Citizens’ Utility Ratepayer Board filed a joint motion to approve a stipulated settlement agreement granting a $28 million increase in base rates and an $18 million reduction in amounts currently recovered through surcharges, effectively increasing its annual revenues by a net amount of $10 million. The KCC approved this settlement in December 2012, and the new rates were effective January 2013.

In September 2012, the KCC denied Kansas Gas Service’s application to implement an infrastructure-replacement program that would have allowed Kansas Gas Service to accelerate the rate at which it is replacing cast-iron pipe. Costs incurred by Kansas Gas Service to replace cast-iron pipe are eligible for the GSRS. This surcharge is a capital-recovery mechanism that allows for rate adjustment, providing recovery of and a return on incremental safety-related and government-mandated capital investments made between rate cases.

The KCC approved an application from Kansas Gas Service to increase the GSRS by an additional $2.9 million, effective January 2012.

Texas—Texas Gas Service has filed rate cases and requests for interim rate relief under the GRIP and cost-of-service adjustments in various Texas jurisdictions to address investments in rate base and changes in expense.

GRIP is a capital-recovery mechanism that allows for an interim rate adjustment providing recovery and a return on incremental capital investments made between rate cases. We have filed requests for interim rate relief under the GRIP statute with the cities of Austin, Texas, and surrounding communities in February 2013 and with El Paso, Texas, in April 2013 for approximately $4.1 million and $4.9 million, respectively. In May 2013, the City of Austin approved the requested increase. In July 2013, the City of El Paso denied Texas Gas Service’s GRIP request, which we appealed with the RRC. In September 2013, the RRC approved Texas Gas Service’s requested increase.

In the normal course of business, we have filed rate cases and sought GRIP and cost-of-service adjustments in various other Texas jurisdictions to address investments in rate base and changes in expense. Annual rate increases totaling $4.1 million and $10.1 million associated with these filings were approved during the nine months ended September 30, 2013, and the year ended December 31, 2012, respectively.

In January 2012, the RRC approved a settlement between Texas Gas Service and the City of El Paso that allows for recovery of 2010 through 2013 pipeline-integrity expenditures and partial recovery of rate-case expenses. The settlement did not have a material impact on our results of operations.

General—Certain costs to be recovered through the ratemaking process have been capitalized as regulatory assets. Should recovery cease due to regulatory actions, certain of these assets may no longer meet the criteria for recognition and accordingly, a writeoff of regulatory assets and stranded costs may be required. There were no writeoffs of regulatory assets resulting from the failure to meet the criteria for capitalization during the nine-month period ended September 30, 2013, or during 2012, 2011 or 2010.

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Nine Months Over Nine Months Results of Operations

Selected Financial Results—The following table sets forth certain selected financial results for the periods indicated:

	Nine Months Ended September 30,				Nine Months 2013 vs. 2012
Financial Results	2013		2012		Increase (Decrease)
	(Millions of dollars)
Natural gas sales	$	1,071.2	$	853.0	$	218.2		26	%
Transportation revenues		71.8		65.2		6.6		10	%
Cost of natural gas		577.9		398.1		179.8		45	%
Net margin, excluding other revenues		565.1		520.1		45.0		9	%
Other revenues		24.3		25.7		(1.4	)	(5	)%
Net margin		589.4		545.8		43.6		8	%
Operating costs		334.0		310.8		23.2		7	%
Depreciation and amortization		100.1		97.5		2.6		3	%
Operating income	$	155.3	$	137.5	$	17.8		13	%
Capital expenditures	$	206.4	$	200.1	$	6.3		3	%

The following table sets forth our net margin, excluding other revenues, by type of customer for the periods indicated:

	Nine Months Ended September 30,				Nine Months 2013 vs. 2012
Net Margin, Excluding Other Revenues	2013		2012		Increase (Decrease)
	(Millions of dollars)
Natural gas sales
Residential	$	407.5	$	375.3	$	32.2	9	%
Commercial and industrial		82.2		76.7		5.5	7	%
Wholesale/public authority		3.6		2.9		0.7	24	%
Net margin on natural gas sales		493.3		454.9		38.4	8	%
Transportation margin		71.8		65.2		6.6	10	%
Net margin, excluding other revenues	$	565.1	$	520.1	$	45.0	9	%

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Our net margin on natural gas sales is comprised of two components, fixed and variable margin. Fixed margin reflects the portion of our net margin attributable to the monthly fixed customer charge component of our rates, which does not fluctuate based on customer usage in each period. Variable net margin reflects the portion of our net margin that fluctuates with the volumes delivered and billed, which includes volumetric delivery charges and charges for riders, surcharges and other regulatory mechanisms associated with the services we provide. We believe that the combination of the significant residential component of our customer base, the fixed charge component of our sales margin and our regulatory rate mechanisms in place result in a stable cash flow profile. The following table sets forth our net margin on natural gas sales by revenue type for the periods indicated:

	Nine Months Ended September 30,				Nine Months 2013 vs. 2012
Net Margin on Natural Gas Sales	2013		2012		Increase (Decrease)
	(Millions of dollars)
Net margin on natural gas sales
Fixed margin	$	351.4	$	326.5	$	24.9	8	%
Variable margin		141.9		128.4		13.5	11	%
Net margin on natural gas sales	$	493.3	$	454.9	$	38.4	8	%

Net margin increased $43.6 million for the nine months ended September 30, 2013, compared with the same period last year, due primarily to the following:

• an increase of $29.8 million from new rates in all three states;

• an increase of $8.0 million due to higher sales volumes due primarily to colder than normal weather in Oklahoma and Kansas in 2013, compared with warmer than normal weather in 2012; and

• an increase of $3.6 million from higher transportation volumes due primarily to higher demand from weather-sensitive customers in Kansas.

Operating costs increased $23.2 million for the nine months ended September 30, 2013, compared with the same period last year, due primarily to the following:

• an increase of $17.0 million in employee-related expense, due primarily to higher pension costs resulting from a change in the estimated discount rate and higher labor costs;

• an increase of $5.3 million in ad valorem tax expense primarily as a result of an increase in the level of ad valorem tax expense recovered in base rates, which is offset in net margin. In Kansas, actual ad valorem taxes incurred that differ from the level of ad valorem taxes recovered in base rates continue to be deferred and recovered or refunded through the AVTS; and

• an increase of $2.4 million in bad debt expense as a result of increased revenues.

Capital Expenditures—Our capital expenditures program includes expenditures for pipeline integrity, automated meter reading, extending service to new areas, modifications to customer-service lines, increasing system capabilities, relocating facilities to accommodate government construction and replacements. It is our practice to maintain and upgrade facilities to ensure safe, reliable and efficient operations. Capital expenditures increased $6.3 million for the nine months ended September 30, 2013, compared with the same period last year, primarily as a result of extending service to new areas.

Our capital expenditures are expected to be approximately $286 million and $263 million for 2013 and 2014, respectively. Through our participation in ONEOK’s cash management program, we finance our capital expenditures. Following the separation, we expect to fund capital expenditures with cash flows from operations or proceeds from the incurrence of short- or long-term debt or from the issuance of equity.

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Selected Operating Information—The following tables set forth certain selected information for our operations for the periods indicated:

	Nine Months Ended September 30,
Number of Customers	2013		2012
Residential		1,945,631		1,932,295
Commercial and industrial		155,391		154,430
Wholesale/public authority		2,761		2,739
Transportation		12,022		11,908
Total customers		2,115,805		2,101,372

	Nine Months Ended September 30,
Volumes (MMcf)	2013		2012
Natural gas sales
Residential		79,136		66,060
Commercial and industrial		24,806		21,108
Wholesale/public authority		3,092		5,388
Total volumes sold		107,034		92,556
Transportation		151,660		149,167
Total volumes delivered		258,694		241,723

Residential, commercial and industrial volumes increased for the nine months ended September 30, 2013, compared with the same period last year, due primarily to colder temperatures in 2013; however, the impact on margins was mitigated largely by weather-normalization mechanisms.

Year-Over-Year Results of Operations

Selected Financial Results—The following table sets forth certain selected financial results for the periods indicated:

	Years Ended December 31,						Variances 2012 vs. 2011					Variances 2011 vs. 2010
Financial Results	2012		2011		2010		Increase (Decrease)					Increase (Decrease)
	(Millions of dollars)
Natural gas sales	$	1,252.0	$	1,492.5	$	1,687.4	$	(240.5	)	(16	)%	$	(194.9	)	(12	)%
Transportation revenues		88.8		90.9		91.5		(2.1	)	(2	)%		(0.6	)	(1	)%
Cost of natural gas		620.2		869.5		1,062.5		(249.3	)	(29	)%		(193.0	)	(18	)%
Net margin, excluding other revenues		720.6		713.9		716.4		6.7		1	%		(2.5	)	—	%
Other revenues		35.8		37.9		38.5		(2.1	)	(6	)%		(0.6	)	(2	)%
Net margin		756.4		751.8		754.9		4.6		1	%		(3.1	)	—	%
Operating costs		410.5		419.9		398.3		(9.4	)	(2	)%		21.6		5	%
Depreciation and amortization		130.2		132.2		131.0		(2.0	)	(2	)%		1.2		1	%
Operating income	$	215.7	$	199.7	$	225.6	$	16.0		9	%	$	(25.9	)	(11	)%
Capital expenditures	$	272.0	$	241.0	$	217.9	$	31.0		13	%	$	23.1		11	%

A decrease in natural gas prices during the periods presented impacted our natural gas sales and cost of natural gas.

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The following table sets forth our net margin, excluding other revenues, by type of customer for the periods indicated:

	Years Ended December 31						Variances 2012 vs. 2011					Variances 2011 vs. 2010
Net Margin, Excluding Other Revenues	2012		2011		2010		Increase (Decrease)					Increase (Decrease)
	(Millions of dollars)
Natural gas sales
Residential	$	523.4	$	510.5	$	509.1	$	12.9		3	%	$	1.4		—	%
Commercial and industrial		103.8		107.9		111.1		(4.1	)	(4	)%		(3.2	)	(3	)%
Wholesale/public authority		4.6		4.6		4.7		—		—	%		(0.1	)	(2	)%
Net margin on natural gas sales		631.8		623.0		624.9		8.8		1	%		(1.9	)	—	%
Transportation margin		88.8		90.9		91.5		(2.1	)	(2	)%		(0.6	)	(1	)%
Net margin, excluding other revenues	$	720.6	$	713.9	$	716.4	$	6.7		1	%	$	(2.5	)	—	%

Our net margin on natural gas sales is comprised of two components, fixed and variable margin. Fixed margin reflects primarily the portion of our net margin attributable to the monthly fixed customer charge component of our rates, which does not fluctuate based on customer usage in each period. Variable net margin reflects the portion of our net margin that fluctuates with the volumes delivered and billed, which includes volumetric delivery charges and charges for riders, surcharges and other regulatory mechanisms associated with the services we provide. We believe that the combination of the significant residential component of our customer base, the fixed charge component of our sales margin and our regulatory rate mechanisms in place result in a stable cash flow profile. The following table sets forth our net margin on natural gas sales by fixed or variable margin for the periods indicated:

	Years Ended December 31,						Variances 2012 vs. 2011				Variances 2011 vs. 2010
Net Margin on Natural Gas Sales	2012		2011		2010		Increase (Decrease)				Increase (Decrease)
	(Millions of dollars)
Net margin on natural gas sales
Fixed margin	$	439.3	$	434.2	$	431.4	$	5.1	1	%	$	2.8		1	%
Variable margin		192.5		188.8		193.5		3.7	2	%		(4.7	)	(2	)%
Net margin on natural gas sales	$	631.8	$	623.0	$	624.9	$	8.8	1	%	$	(1.9	)	—	%

2012 vs. 2011—Net margin increased $4.6 million due primarily to the following:

• an increase of $15.4 million from new rates in all three states; offset partially by

• a decrease of $8.5 million due to expiration of the IMP rider, which allowed Oklahoma Natural Gas to recover certain deferred pipeline-integrity costs. This decrease is offset by lower regulatory amortization in depreciation and amortization expense; and

• a decrease of $2.1 million from lower transportation volumes due to warmer weather resulting in lower sales to weather-sensitive customers in Kansas and Oklahoma that are not subject to weather normalization adjustments.

Operating costs decreased $9.4 million due primarily to the following:

• a decrease of $14.8 million in share-based compensation costs from ONEOK common stock awarded in the prior year to employees as part of ONEOK’s stock award program and the appreciation in ONEOK’s share price during 2011. Subsequent to the separation, the Executive Compensation Committee of the ONE Gas Board of Directors will determine the type and amount of future share-based compensation for ONE Gas employees and nonemployee directors;

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• a decrease of $8.9 million in employee-related incentive and health benefit costs due to reduced short-term incentives and medical claims expenses; offset partially by

• an increase of $5.4 million in pension costs as a result of the annual change in the estimated discount rate;

• an increase of $4.8 million due primarily to expenses associated with outside services and pipeline maintenance due to pipeline-integrity testing and repairs; and

• an increase of $5.0 million in claims costs due to increased litigation activity.

Depreciation and amortization expense decreased $2.0 million due primarily to a decrease of $8.5 million in regulatory amortization associated with the expiration of the IMP rider, offset partially by an increase of $6.1 million associated with additional capital expenditures.

2011 vs. 2010—Net margin decreased $3.1 million due primarily to the following:

• a decrease of $5.9 million from lower sales volumes due to lower consumption by residential and commercial customers as a result of warmer than normal weather in Kansas in the first quarter of 2011;

• a decrease of $4.9 million due to expiration of the IMP rider. This decrease was offset by lower regulatory amortization in depreciation and amortization expense; offset partially by

• an increase of $4.0 million from new rates, rider recoveries and capital-recovery mechanisms in Texas and Kansas; and

• an increase of $2.1 million from customer growth, primarily in Texas.

Operating costs increased $21.6 million due primarily to the following:

• an increase of $13.2 million in share-based compensation costs from ONEOK common stock awarded to employees as part of ONEOK’s stock award program and the appreciation in ONEOK’s share price during 2011;

• an increase of $8.1 million in employee-related incentive and health benefit costs due to increased short-term incentives and medical claims expenses; and

• an increase of $3.2 million in pension costs as a result of the annual change in the estimated discount rate.

Depreciation and amortization expense increased due primarily to an increase of $6.4 million associated with additional capital expenditures, specifically investments in automated meter reading in Oklahoma, offset partially by a decrease of $4.9 million in regulatory amortization associated with the expiration of the IMP rider.

Our operating results also reflect increased interest expense due primarily to additional borrowings from ONEOK during the periods. The change in income tax expense results primarily from the changes in operating income and interest expense.

Capital Expenditures—Our capital expenditures program includes expenditures for pipeline integrity, automated meter reading, extending service to new areas, modifications to customer-service lines, increasing system capabilities and replacements. It is our practice to maintain and upgrade facilities to ensure safe, reliable and efficient operations.

Capital expenditures increased $31.0 million for 2012, compared with 2011, primarily as a result of increased spending on pipeline replacements. Capital expenditures increased for 2011, compared with 2010, primarily as a result of increased spending on pipeline replacements, offset partially by decreased spending on automated meter reading resulting from the completion of our initiative to install these devices in the major metropolitan areas in Oklahoma in 2010.

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Our capital expenditures are expected to be approximately $286 million and $263 million for 2013 and 2014, respectively. Through our participation in ONEOK’s cash management program, we finance our capital expenditures. Following the separation, we expect to fund capital expenditures with cash flows from operations or proceeds from the incurrence of short- or long-term debt or from the issuance of equity.

Selected Operating Information—The following tables set forth certain selected information for the periods indicated:

	Years Ended December 31,
Number of Customers	2012		2011		2010
Residential		1,932,484		1,921,017		1,912,205
Commercial and industrial		154,252		154,475		154,921
Wholesale/public authority		2,737		2,730		2,701
Transportation		11,926		11,708		11,308
Total customers		2,101,399		2,089,930		2,081,135

	Years Ended December 31,
Volumes (MMcf)	2012		2011		2010
Natural gas sales
Residential		103,799		117,969		121,240
Commercial and industrial		31,459		35,172		36,434
Wholesale/public authority		6,135		3,287		12,060
Total volumes sold		141,393		156,428		169,734
Transportation		199,408		203,655		205,692
Total volumes delivered		340,801		360,083		375,426

Residential and commercial volumes decreased for 2012, compared with 2011, due primarily to warmer temperatures in 2012. Residential and commercial volumes decreased for 2011, compared with 2010, due primarily to warmer temperatures in the first quarter 2011. The impact on margins was mitigated largely by weather-normalization mechanisms.

Wholesale sales represent contracted natural gas volumes that exceed the needs of our residential, commercial and industrial customer base and are available for sale to other parties. The impact to net margin from changes in volumes associated with these customers is minimal.

Contingencies

Legal Proceedings—We are a party to various litigation matters and claims that have arisen in the normal course of our operations. While the results of litigation and claims cannot be predicted with certainty, we believe the reasonably possible losses from such matters, individually and in the aggregate, are not material. Additionally, we believe the probable final outcome of such matters will not have a material adverse effect on our results of operations, financial position or cash flows.

Liquidity and Capital Resources

We believe that obtaining and maintaining an investment-grade credit rating is prudent for our business as we seek to access the capital markets to finance capital investments. We intend to maintain strong credit metrics while we pursue a balanced approach to capital investment and a return of capital to shareholders via a dividend that we believe will be competitive with our peer group. The board of directors of ONEOK has historically declared quarterly dividends. Following the distribution, we anticipate that our board of directors will establish

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dividend practices that will be independent of ONEOK’s historic dividend practices. We expect to recommend to our board of directors a dividend payout ratio target in the range of          percent to              percent of our recurring earnings. The declaration and payment of any dividends in the future by us will be subject to the sole discretion of our board of directors and will depend upon many factors, including our financial condition, earnings, capital requirements, covenants associated with certain of our debt obligations, which may include maintaining certain debt to capital ratios, legal requirements, regulatory constraints and other factors deemed relevant by our board of directors.

Historically, we have relied primarily on operating cash flow and participation in ONEOK’s cash management program for our liquidity and capital resource requirements. We have funded operating expenses and working capital requirements, including purchases of natural gas in storage, primarily with operating cash flow and short-term borrowing from ONEOK. Capital expenditures have been funded by short- and long-term borrowings from ONEOK as well as contributions from ONEOK.

We have entered into a $700 million revolving credit facility which will become effective upon the satisfaction of customary conditions, including the consummation of the separation. We expect to enter into a commercial paper program to support our working capital requirements and general corporate needs after the separation. See the section entitled “Description of Material Indebtedness.” In connection with the separation, we expect that we will receive approximately $1.19 billion of cash from the issuance of debt securities. We expect to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures. The terms of our other financing arrangements, the amount, type and term of the debt securities we will issue, and amount to be paid to ONEOK have not yet been determined, but will be determined prior to the separation. A number of factors could affect this final determination, and the amount of debt securities ultimately issued could be different from the amount disclosed in this Information Statement.

For more information on our planned financing arrangements, please see the sections entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

We believe that the combination of the significant residential component of our customer base, the fixed-charge component of our natural gas sales net margin and our regulatory rate mechanisms that we have in place result in a stable cash flow profile. Because the energy consumption of residential customers is less volatile compared with commercial and industrial customers, our business historically has generated stable and predictable net margin. Additionally, we have several regulatory rate mechanisms in place to reduce the volatility of our cash flows and to allow for reduced lag in earning a return on our capital expenditures. For more information on our regulatory rate mechanisms, please see the section entitled “Business”. We anticipate that our cash flow generated from operations and our expected short- and long-term financing arrangements will enable us to maintain our current and planned level of operations and provide us flexibility to finance our infrastructure investments with short- or long-term debt, the issuance of equity or cash flows from operations.

Our ability to access capital markets for debt and equity financing under reasonable terms depends on market conditions and our financial condition and credit ratings. We expect to have credit ratings that are higher than ONEOK’s current credit ratings. We believe that stronger credit ratings will provide a significant advantage to our business. By maintaining a conservative financial profile and stable revenue base, we believe that we will be able to maintain an investment-grade credit rating higher than ONEOK’s current ratings, which we believe will provide us access to diverse sources of capital at more favorable rates in order to finance our infrastructure investments. Credit ratings agencies perform independent analysis when assigning credit ratings. A lower than anticipated initial credit rating or a downgrade of that rating would increase our future cost of borrowing and negatively affect our available liquidity.

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Cash Flow Analysis

We currently utilize ONEOK’s centralized cash management program that concentrates the cash assets of its operating divisions and subsidiaries in joint accounts for the purpose of providing financial flexibility and lowering the cost of borrowing, transaction costs and bank fees. Under this cash management program, depending on whether we have a short-term cash surplus or cash requirement, we provide cash to ONEOK or ONEOK provides cash to us when necessary. Subsequent to the separation, we will maintain separate cash accounts from ONEOK, and our interest expense will relate only to our borrowings.

We use the indirect method to prepare our Statements of Cash Flows. Under this method, we reconcile net income to cash flows provided by operating activities by adjusting net income for those items that impact net income but may not result in actual cash receipts or payments during the period. These reconciling items include depreciation and amortization, deferred income taxes, provision for doubtful accounts, and changes in our assets and liabilities not classified as investing or financing activities.

Nine Months Over Nine Months

The following table sets forth the changes in cash flows by operating, investing and financing activities for the periods indicated:

	Nine Months Ended September 30,						Variances 2013 vs. 2012
	2013			2012			Increase (Decrease)
	(Millions of dollars)
Total cash provided by (used in):
Operating activities	$	176.1		$	224.2		$	(48.1	)
Investing activities		(205.3	)		(199.8	)		(5.5	)
Financing activities		27.9			(26.2	)		54.1
Change in cash and cash equivalents		(1.3	)		(1.8	)		0.5
Cash and cash equivalents at beginning of period		4.0			4.5			(0.5	)
Cash and cash equivalents at end of period	$	2.7		$	2.7		$	—

Operating Cash Flows—Operating cash flows are affected by earnings from our business activities. Changes in natural gas prices, changes in supply or increased competition from other service providers, could affect our earnings and operating cash flows.

Cash flows from operating activities, before changes in operating assets and liabilities, were approximately $215.8 million for the nine months ended September 30, 2013, compared with $192.5 million for the same period in 2012. The increase was due primarily to higher net margin resulting from new rates in all three states in which we operate and higher volumes attributable to the impact of weather on our customers’ consumption of natural gas offset partially by higher operating costs as discussed in “Financial Results and Operating Information.”

The changes in operating assets and liabilities decreased operating cash flows by approximately $39.7 million for the nine months ended September 30, 2013, compared with an increase of $31.7 million for the same period in 2012. This change is due primarily to an increase in natural gas in storage at September 30, 2013, due to increased storage injections associated with higher leased storage capacity. The change was also due to the collection and payment of trade receivables and payables and the timing of recovery of gas purchase costs through our purchased gas cost mechanisms, resulting from the timing of cash collections from customers and paid to vendors and suppliers, which vary from period to period.

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Investing Cash Flows—The change in cash flows used in investing activities for the nine months ended September 30, 2013, compared with the same period in 2012, reflects a slight increase in capital expenditures, primarily as a result of extending service to new areas.

Financing Cash Flows—The change in cash flows from financing activities is the result of a decrease in distributions to ONEOK and an increase in borrowings on the short-term note payable to ONEOK to fund higher natural gas storage injections and capital expenditures.

Year Over Year

The following table sets forth the changes in cash flows by operating, investing and financing activities for the periods indicated:

										Variances
	Years Ended December 31,									2012 vs. 2011			2011 vs. 2010
	2012			2011			2010			Increase (Decrease)
	(Millions of dollars)
Total cash provided by (used in):
Operating activities	$	196.6		$	192.8		$	233.4		$	3.8		$	(40.6	)
Investing activities		(270.6	)		(240.8	)		(217.5	)		(29.8	)		(23.3	)
Financing activities		73.5			50.5			(17.6	)		23.0			68.1
Change in cash and cash equivalents		(0.5	)		2.5			(1.7	)		(3.0	)		4.2
Cash and cash equivalents at beginning of period		4.5			2.0			3.7			2.5			(1.7	)
Cash and cash equivalents at end of period	$	4.0		$	4.5		$	2.0		$	(0.5	)	$	2.5

Operating Cash Flows—Operating cash flows are affected by earnings from our business activities. Changes in natural gas prices and demand for our services or natural gas, whether because of general economic conditions, changes in supply or increased competition from other service providers, could affect our earnings and operating cash flows.

2012 vs. 2011—Cash flows from operating activities, before changes in operating assets and liabilities, were $288.7 million for 2012, compared with $308.9 million for 2011. The decrease resulted primarily from a refund of income taxes in 2011. The decrease was offset partially by higher margin resulting from new rates in all three states offset partially by the expiration of the IMP rider in Oklahoma and higher operating costs as discussed in “Financial Results and Operating Information.”

The changes in operating assets and liabilities decreased operating cash flows $92.1 million for 2012, compared with an decrease of $116.1 million for the same period in 2011. The change in operating assets and liabilities was due primarily to the collection and payment of trade receivables and payables and the timing of recovery of gas purchase costs through our purchased gas cost mechanisms, resulting from the timing of cash collections from customers and payments to vendors and suppliers, which vary from period to period.

2011 vs. 2010—Cash flows from operating activities, before changes in operating assets and liabilities, were $308.9 million for 2011, compared with $276.4 million for 2010. The increase resulted primarily from a refund of income taxes in 2011 compared with taxes paid in 2010. The increase was offset partially by lower natural gas sales net margin due to lower consumption by residential and commercial customers as a result of warmer than normal weather in Kansas in the first quarter 2011 and increased operating costs as discussed in “Financial Results and Operating Information.”

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The changes in operating assets and liabilities decreased operating cash flows $116.1 million for 2011, compared with a decrease of $43.0 million for 2010. The change was due primarily to the collection and payment of trade receivables and payables and the timing of recovery gas purchase costs through our purchased gas cost mechanisms, resulting from the timing of cash collections from customers and payments to vendors and suppliers, which vary from period to period.

Investing Cash Flows—Cash used in investing activities increased for 2012, compared with 2011, due primarily to capital expenditures on pipeline replacements. Cash used in investing activities increased for 2011, compared with 2010, due primarily to capital expenditures on pipeline replacements offset partially by decreased spending on automated meter reading equipment.

Financing Cash Flows—The changes in cash flows from financing activities is the result of our participation in ONEOK’s cash management program and distributions to ONEOK.

Contractual Obligations

The following table sets forth our contractual obligations at December 31, 2012:

	Contractual Obligations Due by Period
	(Millions of dollars)
	2013		2014-2015		2016-2017		Thereafter		Total
Long-term line of credit with ONEOK	$	—	$	—	$	—	$	1,027.6	$	1,027.6
Short-term note payable to ONEOK		294.1		—		—		—		294.1
Long-term debt, including current maturities		0.2		—		—		1.3		1.5
Interest payments on debt		59.5		119.0		119.0		178.5		476.0
Firm transportation and storage capacity contracts		172.3		319.5		214.1		75.0		780.9
Natural gas purchase commitments		416.1		185.2		9.6		12.5		623.4
Employee benefit plans		11.5		11.5		13.0		—		36.0
Operating leases		2.5		3.2		2.7		4.5		12.9
Total	$	956.2	$	638.4	$	358.4	$	1,299.4	$	3,252.4

Long-term line of credit with ONEOK and short-term note payable to ONEOK—Immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK is expected to contribute to the capital of the natural gas distribution business all of these amounts outstanding.

Long-term debt and interest payments on debt—We expect to incur approximately $1.2 billion of long-term debt in connection with the separation, which is not reflected in this table. The annual interest payments on this debt would be approximately $55 million at an assumed effective interest rate of 4.6 percent. Please see “Summary—The Separation” and our Unaudited Pro Forma Financial Statements included elsewhere in this Information Statement.

Firm transportation and storage contracts—We are party to fixed-price contracts providing us with firm transportation and storage capacity. The commitments associated with these contracts are recoverable through our purchased gas cost mechanisms as allowed by the applicable regulatory authority.

Natural gas purchase commitments—We are party to fixed-price and variable-price contracts for the purchase of natural gas. Estimated future variable-price natural gas purchase commitments are estimated based on market price information. Actual future variable-price purchase commitments may vary depending on market prices at the time of delivery. As market information changes daily and is potentially volatile, these values may change significantly. The commitments associated with these contracts are recoverable through our purchased gas cost mechanisms as allowed by the applicable regulatory authority.

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Employee benefit plans—ONEOK has employee defined benefit retirement plans and welfare plans that provide postretirement medical and life insurance benefits covering certain employees, which we refer to as “Shared Plans.” The Shared Plans include participants who provide services directly to our operations, as well as employees who support our operations. We account for the Shared Plans as if they were multiemployer benefit plans. Accordingly, we do not record an asset or liability to recognize the funded status of the Shared Plans. We will adopt and sponsor defined benefit retirement plans and other postretirement benefit plans that are consistent with the plans sponsored by ONEOK. Liabilities related to employee and retiree benefit plans generally will be assigned to ONEOK or us based on the individual’s last employment. We expect to fund our pension costs at a level needed to maintain or exceed the minimum funding levels required by the Employee Retirement Income Security Act of 1974, as amended, and the Pension Protection Act of 2006. See Note 2 (b) of the Notes to Unaudited Pro Forma Financial Statements for discussion of our expected employee benefit plans.

Operating leases—Our operating leases include leases for office space, pipeline equipment and vehicles.

Regulatory and Environmental Matters

We are subject to multiple historical, wildlife preservation and environmental laws and/or regulations that affect many aspects of our present and future operations. Regulated activities include but are not limited to those involving air emissions, storm water and wastewater discharges, handling and disposal of solid and hazardous wastes, wetland preservation, hazardous materials transportation, and pipeline and facility construction. These laws and regulations require us to obtain and/or comply with a wide variety of environmental clearances, registrations, licenses, permits and other approvals. Failure to comply with these laws, regulations, licenses and permits may expose us to fines, penalties and/or interruptions in our operations that could be material to our results of operations. In addition, emission controls and/or other regulatory or permitting mandates under the Clean Air Act and other similar federal and state laws could require unexpected capital expenditures at our facilities. We cannot assure that existing environmental statutes and regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional statutes or regulations that result in increased compliance costs or additional operating restrictions could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The EPA’s rule on air-quality standards titled, “National Emission Standards for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines,” included a compliance date in October 2013. We do not expect expenditures required to comply with this rule to have a material impact on our results of operations, financial position or cash flows.

Additional information about our environmental matters is included in the sections entitled “Environmental and Safety Matters” and “Business” of this Information Statement and Note 9 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement. We cannot assure that existing environmental statutes and regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional regulations that result in increased compliance costs or additional operating restrictions could have a material adverse effect on our business, financial condition and results of operations. Our expenditures for environmental evaluation, mitigation, remediation and compliance to date have not been significant in relation to our financial position, results of operations or cash flows, and our expenditures related to environmental matters had no material effects on earnings or cash flows during the nine months ended September 30, 2013 or during 2012, 2011 and 2010. We do not expect to incur material expenditures for these matters in the future.

Estimates and Critical Accounting Policies

The preparation of our financial statements and related disclosures in accordance with GAAP requires us to make estimates and assumptions with respect to values or conditions that cannot be known with certainty that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the

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date of the financial statements. These estimates and assumptions also affect the reported amounts of revenue and expenses during the reporting period. Although we believe these estimates and assumptions are reasonable, actual results could differ from our estimates.

The following summary sets forth what our management considers to be our most critical accounting policies. Our critical accounting policies, which are defined as those estimates and policies most important to the portrayal of our financial condition and results of operations and requiring management’s most difficult, subjective or complex judgment, particularly because of the need to make estimates concerning the impact of inherently uncertain matters.

Regulation

Our operations are subject to regulation with respect to rates, service, maintenance of accounting records and various other matters by the respective regulatory authorities in the states in which we operate. We account for the financial effects of the ratemaking and accounting practices and policies of the various regulatory commissions in our financial statements. We record regulatory assets for costs that have been deferred for which future recovery through customer rates is considered probable and regulatory liabilities when it is probable that revenues will be reduced for amounts that will be credited to customers through the ratemaking process. As a result, certain costs that would normally be expensed under GAAP are capitalized or deferred on the balance sheet because it is probable they can be recovered through rates. Discontinuing the application of this method of accounting for regulatory assets and liabilities could significantly increase our operating expenses as fewer costs would likely be capitalized or deferred on the balance sheet, which could reduce our net income. Further, regulation may impact the period in which revenues or expenses are recognized. The amounts to be recovered or recognized are based upon historical experience and our understanding of the regulations. The impact of regulation on our operations may be affected by decisions of the regulatory authorities or the issuance of new regulations.

For further discussion of regulatory assets and liabilities, see Note 4 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement.

Impairment of Goodwill

We assess our goodwill for impairment at least annually as of July 1. Our goodwill impairment analysis performed as of July 1, 2013, utilized a qualitative assessment and did not result in an impairment charge nor did our analysis reflect any risk of impairment. Subsequent to that date, no event has occurred indicating that the implied fair value is less than the carrying value of our net assets. There were no impairment charges resulting from our 2012 or 2011 annual impairment tests. A decline of 10 percent in our estimated fair value would not have resulted in an impairment charge.

As part of our goodwill impairment test, we first assess qualitative factors (including macroeconomic conditions, industry and market considerations, cost factors and overall financial performance) to determine whether it is more likely than not that our fair value is less than our carrying amount. If further testing is necessary, we perform a two-step impairment test for goodwill. In the first step, an initial assessment is made by comparing our fair value with our book value, including goodwill. If the fair value is less than the book value, an impairment is indicated, and we must perform a second test to measure the amount of the impairment. In the second test, we calculate the implied fair value of the goodwill by deducting the fair value of all tangible and intangible net assets from the fair value determined in step one of the assessment. If the carrying value of the goodwill exceeds the implied fair value of the goodwill, we will record an impairment charge.

To estimate our fair value, we use two generally accepted valuation approaches, an income approach and a market approach, using assumptions consistent with a market participant’s perspective. Under the income approach, we use anticipated cash flows over a period of years plus a terminal value and discount these amounts

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to their present value using appropriate discount rates. Under the market approach, we apply acquisition multiples to forecasted cash flows. The acquisition multiples used are consistent with historical asset transactions. The forecasted cash flows are based on average forecasted cash flows over a period of years.

Our impairment tests require the use of assumptions and estimates such as industry economic factors and the profitability of future business strategies. If actual results are not consistent with our assumptions and estimates or our assumptions and estimates change due to new information, we may be exposed to future impairment charges.

See Note 1 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement for our goodwill disclosure.

Pension and Postretirement Employee Benefits

ONEOK has employee defined benefit retirement plans and welfare plans that provide postretirement medical and life insurance benefits covering certain employees, which we refer to as “Shared Plans.” Liabilities related to employee and retiree benefit plans generally will be assigned based on the individual’s last employment, so each individual who (1) retired from ONEOK while providing services to the natural gas distribution segment, (2) is currently associated with the natural gas distribution business, or (3) will be assigned to ONE Gas in connection with the separation will have his or her benefit plan liabilities assigned to ONE Gas.

Employee and retiree benefit liabilities relating to all other personnel not meeting one of the three criteria above will remain the liability of ONEOK. Assets in the benefit plans are expected to be assigned in accordance with the applicable rules and regulations associated with the division of a single plan into separate plans. We expect to have defined benefit pension plans and postretirement welfare plans for certain employees. Following the separation and assignment of plan participants, our defined benefit plans are expected to be closed to new participants, and our postretirement welfare plans are expected only to subsidize costs for providing postretirement medical benefits for certain participants. The cost of providing these benefits to eligible current and former employees is subject to changes in the market value of our pension and postretirement benefit plan assets, changing demographics, including longer life expectancy of plan participants and their beneficiaries and changes in health care costs.

The Shared Plans include participants who provide services directly to our operations, as well as employees who support our operations. We account for the Shared Plans as if they were multiemployer benefit plans. Accordingly, we do not record an asset or liability to recognize the funded status of the Shared Plans. We recognize a liability only for any required contributions to the Shared Plans that are accrued and unpaid at the balance sheet date. The related pension and postretirement expenses are allocated to us based primarily on plan participants that are part of our operations. These pension and postretirement benefit costs include amounts associated with vested participants who are no longer employees. ONEOK also charges us for the allocated cost of certain employees of ONEOK who provide general and administrative services on our behalf. ONEOK includes an allocation of the benefit costs associated with these ONEOK employees based upon its allocation methodology, not necessarily specific to the employees providing general and administrative services on our behalf. See Note 2 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement for discussion of ONEOK’s allocation methodology.

ONEOK’s actuarial consultant calculates the expense related to these plans and uses statistical and other factors that attempt to anticipate future events. These factors include assumptions about the discount rate, expected return on plan assets, rate of future compensation increases, age and employment periods. In determining the projected benefit costs, assumptions can change from period to period and may result in material changes in the costs we recognize related to plan participants who are direct employees who support our operations. See Note 7 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement for additional information.

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During 2012, we recorded net periodic benefit costs associated with direct employees who support our operations of $22.8 million and $16.6 million related to defined benefit pension plans and postretirement benefits, respectively. We estimate that in 2013, we will record net periodic benefit costs of $35.9 million related to defined benefit pension plans and $12.3 million related to postretirement benefits. In determining the 2013 estimated net periodic benefit costs for the postretirement benefits, ONEOK assumed a discount rate of 4.25 percent and an expected long-term return on plan assets of 8.25 percent. These costs are not necessarily indicative of the costs that we would have incurred had we been a stand-alone entity for these periods.

Revenue Recognition

For regulated deliveries of natural gas, we read meters and bill customers on a monthly cycle. We recognize revenues upon the delivery of natural gas commodity or services rendered to customers. Revenues are accrued for natural gas delivered and services rendered to customers, but not yet billed, based on estimates from the last meter reading date to month end (accrued unbilled revenue). The billing cycles for customers do not necessarily coincide with the accounting periods used for financial reporting purposes. We accrue unbilled revenues for natural gas that has been delivered but not yet billed at the end of an accounting period. Accrued unbilled revenue is based on a percentage estimate of amounts unbilled each month, which is dependent upon a number of factors, some of which require management’s judgment. These factors include customer consumption patterns and the impact of weather on usage.

Contingencies

Our accounting for contingencies covers a variety of business activities, including contingencies for legal and environmental exposures. We accrue these contingencies when our assessments indicate that it is probable that a liability has been incurred or an asset will not be recovered and an amount can be reasonably estimated. We expense legal fees as incurred and base our legal liability estimates on currently available facts and our assessments of the ultimate outcome or resolution. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than the completion of a remediation feasibility study. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. Our expenditures for environmental evaluation, mitigation, remediation and compliance to date have not been significant in relation to our financial position or results of operations, and our expenditures related to environmental matters had no material effect on earnings or cash flows for the nine months ended September 30, 2013 or 2012, or during 2012, 2011 and 2010. Actual results may differ from our estimates resulting in an impact, positive or negative, on earnings.

See Note 9 of the Notes to Financial Statements in the Annual Audited Financial Statements included elsewhere in this Information Statement for additional discussion of contingencies.

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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our exposure to market risk discussed below includes forward-looking statements. Our views on market risk are not necessarily indicative of actual results that may occur and do not represent the maximum possible gains and losses that may occur since actual gains and losses will differ from those estimated based on actual fluctuations in interest rates or commodity prices and the timing of transactions.

Commodity Price Risk

Our commodity price risk, driven primarily by fluctuations in the price of natural gas, is mitigated by our purchased-gas cost adjustment mechanism. We use derivative instruments to economically hedge the cost of anticipated natural gas purchases during the winter heating months to protect our customers from upward market price volatility of natural gas. Additionally, we inject natural gas into storage during the summer months and withdraw the natural gas during the winter heating season. Gains or losses associated with these derivative instruments and storage activities are included in, and recoverable through, the purchased-gas cost adjustment mechanism. These costs are subject to review by regulatory authorities as part of our purchased-gas cost adjustment mechanism.

Interest-Rate Risk

We are exposed to interest-rate risk primarily associated with new debt financing needed to fund capital requirements, including future contractual obligations and maturities of long-term and short-term debt. We are exposed to interest rate risk in the normal course of business primarily associated with new debt financing, which includes our anticipated $1.2 billion debt issuance. We expect to manage interest-rate risk on future borrowings through the use of fixed-rate debt, floating-rate debt and, at times, interest-rate swaps. Fixed-rate swaps may be used to reduce our risk of increased interest costs during periods of rising interest rates. Floating-rate swaps may be used to convert the fixed rates of long-term borrowings into short-term variable rates.

Counterparty Credit Risk

We assess the creditworthiness of our customers. Those customers who do not meet minimum standards are required to provide security, including deposits and other forms of collateral, when appropriate. With more than 2 million customers across three states, we are not exposed materially to a concentration of credit risk. We maintain a provision for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends, consideration of the current credit environment and other information. In most jurisdictions we are able to recover natural gas costs related to uncollectible accounts through purchased-gas cost mechanisms.

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INDUSTRY OVERVIEW

The natural gas industry is primarily composed of four types of companies: exploration and production, gathering and processing, transmission and storage, and local distribution. Distribution represents the final step in delivering natural gas to customers. While some large industrial, commercial and electric-generation customers receive natural gas directly from high-capacity interstate and intrastate transmission pipelines, most users receive natural gas from a local distribution company, or LDC. LDCs are regulated natural gas utilities that deliver natural gas to consumers within a specific geographic area.

Local distribution companies typically transport natural gas from central delivery points located on interstate and intrastate transmission pipelines to households. The delivery point where the natural gas is transferred from a transmission pipeline to the local gas utility is often termed the “citygate.” Utilities take ownership of the natural gas at the citygate and deliver it to each individual customer’s meter through an extensive network of thousands of miles of small-diameter distribution pipe. The American Gas Association estimates that there are 2.4 million miles of distribution pipelines in the United States, serving more than 70 million households and businesses.

In contrast to natural gas transmission pipelines, the delivery of natural gas to its point of end-use by an LDC typically involves moving smaller volumes of gas through smaller diameter pipe at much lower pressures over shorter distances to a greater number of individual users, although certain high-volume customers require larger pipelines operating at higher pressures. Smaller-diameter pipe is also used to transport natural gas from the citygate to individual consumers. Because of the smaller volumes of natural gas to be moved, as well as the small-diameter pipe that is used, the pressure required to move natural gas through the distribution network is typically much lower than that found in the transmission pipelines. The lower the operating pressure of a pipeline, the less susceptible the pipeline is to rupturing.

Traditionally, local natural gas utilities have been awarded exclusive rights to distribute natural gas in a specified geographic area. State public utility commissions are charged with the oversight and regulation of local natural gas utilities. State regulation of local distribution companies has a variety of objectives, including ensuring adequate supply, dependable service and reasonable prices for consumers, while also providing utility companies the opportunity to earn a fair and reasonable return on their investments.

LDCs do not earn a profit from the price of natural gas supplied to their customers; rather, LDCs provide a delivery service at rates set by government regulators based on the cost of operating the delivery system, including the cost of capital. The delivery service rate is combined with the cost of the natural gas supplied to determine a customer’s bill. The most significant component of a customer’s bill is the cost of the natural gas supply, which fluctuates based on the price of natural gas. Approximately one-half to two-thirds of every dollar of an LDC’s utility revenue is used to recover the cost of the natural gas supplied.

Natural gas is believed by many to be a critical energy source for the future. The abundance of natural gas coupled with its environmental soundness and multiple applications across all sectors, means that natural gas is expected to continue to play an increasingly important role in meeting demand for energy in the United States.

In its Annual Energy Outlook 2013, the EIA projects that natural gas consumption will increase through 2040, primarily driven by increased use of natural gas in the industrial and electric power generation sectors. There are a number of factors that impact the long-term demand for natural gas, including: residential and commercial demand, driven primarily by residential heating applications; the price of electricity; the price of natural gas; energy efficiency; technological advances; state of the economy; use of natural gas for electric generation; use of natural gas in the transportation sector; and environmental regulations. An increasing demand for ethane, which is a component of unprocessed natural gas, in the petrochemical market will likely also drive the production of greater amounts of natural gas. Although natural gas demand in the transportation sector accounts for only a small part of total U.S. natural gas consumption, significant growth in demand is expected to

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be driven by continued low natural gas prices and regulatory incentives. The EIA projects demand for natural gas in the transportation sector to increase by a compound annual growth rate of 11.9 percent between 2011 and 2040, representing total demand in 2040 of just over 1 trillion cubic feet.

In the short term, demand for natural gas by LDC customers is impacted by the weather, fuel switching and the economy. Due to the extensive use of natural gas for heating and the increasing use of natural gas for power generation, the demand for natural gas is primarily seasonal, with demand peaks during the winter to meet heating load and in the summer to meet power-generation load.

In its Annual Energy Outlook 2013, the EIA projects that natural gas production will continue to increase, outpacing domestic consumption by 2019 and spurring net exports of natural gas. There are a number of factors that impact the long-term supply of natural gas, including, among others: the price of natural gas and crude oil; the level of drilling activity; drilling technology, including completion techniques known as hydraulic fracturing, or fracking; imports and exports of natural gas; and pipeline infrastructure.

The supply dynamics for natural gas have changed dramatically over the past decade, primarily due to the development of horizontal drilling technology and well-completion technology called hydraulic fracturing, which has enabled producers to access unconventional natural gas resources, such as natural gas in shale formations, which previously were not recoverable on an economical basis. The development of these unconventional natural gas resources has vastly expanded the supply of natural gas in the United States. Further, pipeline expansion has allowed various regions of the country, including the areas in which we operate, to access these new supply sources. The combination of new supply and pipeline expansions has led to a decline in natural gas prices and a tempering of extreme price movements during periods of peak demand.

We believe that the combination of the low cost and adequate supplies of natural gas will continue for the foreseeable future and will have a positive impact on our ability to provide our customers with natural gas service at a lower cost relative to other alternatives.

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BUSINESS

As discussed above in the section entitled “The Separation,” only the natural gas distribution business of ONEOK will be included in the assets and liabilities transferred to us in connection with the distribution. The following description of our business describes our business as it will be conducted by us following the separation.

Our Business

We are one of the largest natural gas utilities in the United States in terms of customer count. We are the successor to the company founded in 1906 as Oklahoma Natural Gas Company. We are incorporated under the laws of the state of Oklahoma, and, following the separation, our common stock is expected to be listed on the NYSE under the trading symbol “OGS.” We are the largest natural gas distributor in Oklahoma and Kansas and the third largest natural gas distributor in Texas, providing service as a regulated public utility to wholesale and retail customers. Our largest natural gas distribution markets in terms of customers are Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita and Topeka, Kansas; and Austin and El Paso, Texas. We serve residential, commercial, industrial and transportation customers in all three states. In addition, we serve wholesale and public authority customers.

The following map reflects the areas in which we operate in Oklahoma, Kansas and Texas.

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Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service distribute natural gas as public utilities to approximately 87 percent, 70 percent and 14 percent of the natural gas distribution customers in Oklahoma, Kansas and Texas, respectively.

The below table sets forth key statistics of our service territories as of and for the nine months ended September 30, 2013:

Key Service Territory Data	Oklahoma		Kansas		Texas		Total
Customers:		847,092		634,325		634,388		2,115,805
Residential		770,369		578,544		596,718		1,945,631
Commercial and industrial		72,108		50,199		33,817		155,391
Wholesale and public authority		—		18		2,743		2,761
Transportation		5,348		5,564		1,110		12,010
Miles of pipelines (approximate)		19,000		14,000		10,000		43,000

Our Competitive Strengths

We have a number of competitive strengths that we believe will contribute to the sustainability of our business and add value to all of our stakeholders, including our shareholders, customers and employees:

100 Percent Regulated Utility Focus

We will be a 100 percent regulated natural gas distribution company that serves three contiguous states—Oklahoma, Kansas and Texas. Unlike many other companies with natural gas distribution businesses, we do not have any operations outside of our natural gas utility business. We believe that we will be better positioned for long-term success following the separation because we will be able to focus our efforts on our core natural gas utility business, allowing us to deploy capital optimally and to promote steady and stable rate base and earnings-per-share growth, while delivering a competitive dividend to our shareholders.

Significant Scale

We serve approximately 2.1 million customers across three contiguous states—Oklahoma, Kansas and Texas. By customer count, we would be the third largest publicly traded natural gas LDC in the country as of December 31, 2012, according to our review of publicly available information. Our service territory includes several major cities including Tulsa, Oklahoma City, Topeka, Kansas City, Wichita, Austin and El Paso. The contiguous nature and proximity of our service territories allow for favorable economies of scale, while the size of our service territories offers significant regulatory and geographic diversity, with no single jurisdiction comprising more than 40 percent of our customers.

High-Quality Service Territories

Our service territories provide significant economic benefits to our business. According to the United States Department of Labor, the average unemployment rate of Oklahoma, Kansas, and Texas through August 2013 is estimated to be 5.9 percent, or 20 percent below the national average. Moreover, the three states containing our service territories are expected to experience a higher aggregate population growth rate through 2015 according to projections from the United States Census Bureau and state government agencies. We believe that the economic and demographic characteristics of our service territories position us to continue to deliver customer and rate base growth through investments focused on maintaining the safety and reliability of our existing infrastructure, as well as connecting new customers to our system.

Stability of Our Cash Flows

We believe that the combination of the significant residential component of our customer base, the fixed-charge component of our sales margin and our regulatory rate mechanisms in place result in a stable cash flow

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profile. Residential users accounted for 92 percent of our customers and 83 percent of our natural gas sales net margin in 2012. Approximately 70 percent of our natural gas sales net margin in 2012 was derived from fixed charges to our customers. Accordingly, our business historically has generated stable and predictable net margin. Additionally, we have several regulatory rate mechanisms in place to reduce the volatility of our cash flows and to allow for reduced lag in earning a return on our capital expenditures. For further information, see “Business—Regulatory Overview.”

Proximity to Natural Gas Resources

Our natural gas commodity costs are comprised of three primary components: the cost of natural gas, transportation fees and storage fees. The territories that we serve are located in close proximity to significant natural gas reserves in Oklahoma, Kansas and Texas. We believe that the location of our service territories and related distribution assets relative to these reserves provides us with diverse supply sources and a distinct and sustainable competitive advantage relative to other energy sources by reducing the total energy cost for four of the main energy consumers in our residential customers’ homes—furnaces, water heaters, cooktops and clothes dryers.

Strong Credit Metrics

We expect to have credit ratings that are higher than ONEOK’s current credit ratings. We believe that stronger credit ratings will provide a significant advantage to our business. By maintaining a conservative financial profile and stable revenue base, we believe that we will be able to maintain an investment-grade credit rating higher than ONEOK’s existing ratings, which we believe will provide us access to diverse sources of capital at more favorable rates in order to finance our infrastructure investments.

Experienced Management Team

Our management team has significant and deep experience in the natural gas utility and midstream industries, including operating, acquiring, constructing, developing and integrating LDC assets, and they understand the service requirements of our customers. Our management team focuses on maintaining open and on-going communications with our regulators, which we believe is beneficial in maintaining a constructive regulatory environment.

Our Strategy

Our primary business objective is to grow our business responsibly, enabling us to deliver an attractive total return to our shareholders over time and to maintain our financial stability. We intend to accomplish this objective by executing on the strategies listed below:

Focus on Safety of Employees, Contractors, the Public and the Environment

We are committed to pursuing a zero-incident safety culture with a focus on mitigating risk and eliminating incidents that may harm our employees, contractors, the public or the environment. Comparing 2009 with the year-to-date period ended August 31, 2013, we have experienced steady improvement across a number of key safety metrics, including a 55 percent reduction in our recordable incident rate and a 40 percent reduction in our preventable vehicle incident rate. In addition, the majority of our capital spending is focused on the safety, reliability and efficiency of our system.

Increase Our Achieved ROE

We continually seek to improve our achieved ROE through improved operational performance and regulatory mechanisms. For 2012, our achieved ROE was 8.3 percent across all of our service territories. The

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weighted-average regulatory ROE that we were allowed to earn during that same period was 10.0 percent. The difference between our achieved and allowed ROE is related primarily to regulatory lag. We make investments that increase our rate base and we incur increases in our costs that are above the amounts reflected in the rates we charge for our service. Additionally, we are not allowed recovery of certain costs we incur. The rates we charge are set in regulatory proceedings generally referred to as rate cases. The delay between the time such investments are made or increases in costs are incurred and the time that our rates are adjusted to reflect these investments and costs is referred to as regulatory lag. We have several mechanisms in place that reduce regulatory lag by allowing for adjustments to our rates between rate cases. In Oklahoma, we are under a performance-based rates mechanism , which provides for streamlined annual rate reviews between rate cases to ensure our achieved ROE remains within the established band of 10 percent to 11 percent. In Kansas, we are allowed to recover a return on and return of qualifying capital investments between rates cases under the Gas System Reliability Surcharge. In Texas, each of our jurisdictions allows us, on an annual basis, to (1) request cost-of-service adjustments to recover and earn a return on investments in rate base and certain changes in operating expenses or (2) recover a return on and return of capital investments between rates cases under the Gas Reliability Infrastructure Program. In addition, Texas Gas Service is allowed to accrue a rate of return, taxes and depreciation expense on safety-related plant replacements from the time the replacements are in service until the plant is reflected in base rates. For further information, please see the section entitled “Business—Regulatory Overview.” In addition, we have several initiatives underway to improve our operational performance. These initiatives include implementing technology that will result in increased productivity and lower operating expenses and restructuring our contractual agreements with third party contractors to reduce expenses.

Focus on Our Credit Metrics and Our Balanced Approach to Capital Management

We believe that maintaining an investment-grade credit rating is prudent for our business as we seek to access the capital markets to finance capital investments. We intend to maintain strong credit metrics while we pursue a balanced approach to capital investment and a return of capital to shareholders via a dividend that we believe will be competitive with our peer group.

Advocate Constructive Relationships with Key Stakeholders

We plan to continue our constructive relationships with all our key stakeholders, including our employees, customers, investors and regulators. Our strategy includes seeking outcomes in future rate cases that provide a fair return on our infrastructure investments, while also meeting the needs of our customers through low-cost, efficient and reliable service. In addition, we will continue our efforts to deliver on our strong record of safety and environmental compliance. We also seek to promote a diverse and inclusive workforce and to reward employees through a market-based compensation system.

Identify and Pursue Growth Opportunities

Our growth opportunities are primarily driven by capital investments related to safety and reliability enhancements to our existing system and the economic and population growth in our service territories. As a result of our commitment to enhance the integrity, reliability and safety of our existing infrastructure, we are making significant investments in our existing system, which leads to further growth of our rate base. In addition, as our service territories continue to experience economic growth, we expect to grow our rate base through capital investments in new service lines and main line extensions that we believe will allow us to meet the energy needs of new customers. As a result of overall trends in the natural gas and energy industries, we believe that the competitiveness of natural gas is increasing relative to other energy alternatives, which is creating new market opportunities for natural gas as an energy source within our existing service territories. Finally, we will continue to evaluate strategic acquisition opportunities based on our disciplined financial and operating approach, while weighing these alternatives against future investment opportunities with respect to our existing rate base.

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Regulatory Overview

We are subject to the regulations and oversight of the state and local regulatory agencies of the territories in which we operate. Rates and charges for natural gas distribution services are established by the OCC for Oklahoma Natural Gas and by the KCC for Kansas Gas Service. Texas Gas Service is subject to regulatory oversight by the various municipalities that it serves, which have primary jurisdiction in their respective areas. Rates in unincorporated areas of Texas and all appellate matters are subject to regulatory oversight by the RRC. These regulatory authorities have the responsibility of ensuring that the utilities in their jurisdictions provide safe and reliable service at a reasonable cost, while providing utility companies the opportunity to earn a fair and reasonable return on their investments.

Generally, a utility’s rates and charges are established in rate case proceedings. Regulatory authorities may also approve mechanisms that allow for adjustments for specific costs or investments made between rate cases. Due to the nature of the regulatory process, there is an inherent lag between the time that a utility incurs additional costs and the setting of new rates to recover those costs.

Oklahoma Natural Gas currently operates under a performance-based rate change plan, which provides for streamlined annual rate reviews between rate cases and includes adjustments for incremental capital investment and certain expenses. Under this plan, we have a targeted ROE of between 10 percent and 11 percent. If our achieved ROE is below 10 percent, our base rates in Oklahoma are increased upon OCC approval to an amount necessary to restore the ROE to 10.5 percent. If our achieved ROE exceeds 11 percent, the portion of the earnings above 11 percent is shared with our customers, with our customers receiving the benefit of 75 percent of the earnings above 11 percent and our company receiving the benefit of the remaining 25 percent. Other regulatory mechanisms in Oklahoma include:

• Purchase Gas Adjustment Clause—Oklahoma Natural Gas’ commodity costs are passed through to its customers without markup via the PGA. Any costs that result from natural gas that is used in operations and the fuel-related portion of bad debts are also recovered through the PGA.

• Temperature Adjustment Clause—TAC is designed to reduce customers’ bills for the additional volumes used when the actual heating degree days exceed the normalized heating degree days and to increase the customers’ bills for volumes not used when actual heating degrees days are less than the normal heating degree days. The TAC is in effect for the months of November through April.

• Energy Efficiency Programs—Oklahoma Natural Gas has been authorized to implement a slate of energy efficiency programs that range from customer education to appliance rebates designed to induce customers and potential customers to select more fuel efficient appliances. The costs associated with these programs and an incentive to offer these programs are recovered through a monthly surcharge on customer bills.

• Rate Design for Residential Customers—Oklahoma Natural Gas is authorized to utilize a rate structure with two different rate choices. Rate Choice “A” is designed for customers whose annual normalized volume is less than 50 Dth. The tariff for these customers contains both a fixed monthly service charge and a per Dth delivery fee. Although a portion of the net margin for customers in Rate Choice “A” is dependent on usage, these customers use relatively small quantities of natural gas and therefore the net margin that is dependent on usage is not significant. Rate Choice “B” is designed for customers whose annual normalized volume is 50 Dth or greater. The tariff for these customers contains only a fixed monthly service charge. Currently, 68 percent of Oklahoma Natural Gas’ residential customers are on Rate Choice “B.”

• Rate Design for Commercial and Industrial Customers—Oklahoma Natural Gas is authorized to utilize a rate structure with two different rate choices for its Small Commercial and Industrial, or SCI, customers. Rate Choice “A” is designed for SCI customers whose annual normalized volume is less than 40 Dth. The tariff for these customers contains both a fixed monthly service charge and a delivery fee. Rate Choice “B” is designed for SCI customers whose annual normalized volume is 40 Dth or

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greater but less than 150 Dth. The tariff for these customers contains only a fixed monthly service charge. All of Oklahoma Natural Gas’ Large Commercial and Industrial, or LCI, customers are on a fixed monthly service charge. Currently, 74 percent of Oklahoma Natural Gas’ commercial and industrial customers are on either SCI Rate Choice “B” or LCI.

• Compressed Natural Gas, Rebate Program—The CNG Rebate Program is designed to promote and support the CNG market in the state of Oklahoma by offering rebates to residential CNG fueling stations and to Oklahoma residents who purchase dedicated and bi-fueled natural gas vehicles. The rebates are funded by a $0.25 per gasoline gallon equivalent surcharge that Oklahoma Natural Gas is authorized to collect on fuel purchased from a CNG dispenser owned by Oklahoma Natural Gas.

The monthly residential customer charge for Oklahoma Natural Gas is $13.21 for Rate Choice “A” customers and $28.76 for Rate Choice “B” customers. Approximately 81 percent of Oklahoma Natural Gas’ net margin from its sales customers is recovered from fixed charges.

Kansas Gas Service operates under a traditional regulatory framework, whereby periodic rate cases are filed with the KCC as needed to increase base rates in order for Kansas Gas Service to be permitted an opportunity to earn its authorized ROE. Other regulatory mechanisms in Kansas include the following:

• Cost of Gas Rider and Annual Cost Adjustment—The COGR and ACA allow Kansas Gas Service to recover the actual cost of the natural gas it sells to its customers. The COGR includes a monthly estimate of the cost Kansas Gas Service incurs in transporting, storing and purchasing natural gas supply for its sales customers, the ACA and other charges and credits. The ACA is an annual component of the COGR that compares the cost of gas recovered through the COGR for the preceding year with the actual natural gas supply costs and the fuel-related portion of bad debts for the same period. Any over or under recovery is reflected in the subsequent year’s COGR.

• Weather Normalization Adjustment—The WNA mechanism allows Kansas Gas Service to accrue the variation in net margin due to abnormal weather occurring from November through March. WNA is designed to reduce customers’ bills for the additional volumes used when the actual heating degree days exceed the normalized heating degree days and to increase the customers’ bills for the reduction in volumes used when actual heating degrees days are less than the normal heating degree days. Once a year, the amount of the adjustment is determined and is then applied to customers’ bills over the subsequent 12-month period.

• Ad Valorem Tax Surcharge—The AVTS surcharge allows KGS to recover the difference each year between the property tax costs built into its rates and its actual property tax costs without having to file a rate case. The amount of the adjustment is determined annually and recovered over the subsequent 12 months as a change in the delivery-charge component.

• Pension and Other Post Retirement Benefits Trackers—The Pension and OPEB Trackers allow Kansas Gas Service to track and defer for recovery in its next rate case the difference between the pension and OPEB costs included in base rates and actual expense as determined in accordance with generally accepted accounting principles.

• Gas System Reliability Surcharge—The GSRS surcharge allows Kansas Gas Service the ability to begin recovering capital costs for qualifying infrastructure investments (i.e., pipeline safety projects and relocation projects) incurred each year in between rate case filings. After five annual filings, Kansas Gas Service is required to file a rate case or cease collection of the surcharge.

The monthly residential customer charge for Kansas Gas Service is $15.35. Approximately 53 percent of Kansas Gas Services’ net margin from its sales customers is recovered from fixed charges. Kansas experiences the highest heating degree days of all of the ONE Gas service territories, which brings a level of stability to net margin even though a significant portion is based on usage.

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Texas Gas Service has grouped its customers into 10 service areas, each of which includes between 2 and 34 cities. Periodic rate cases are filed with the cities, or the RRC as needed, in order for Texas Gas Service to be permitted an opportunity to earn its authorized ROE. Other regulatory mechanisms and constructs in Texas include the following:

• GRIP statute—In four service areas, comprising 81 percent of Texas Gas Service’s customers, the Texas Gas Service makes an annual filing under the GRIP statute, which allows it to recover return, taxes and depreciation on the annual net investment increase. After five annual GRIP filings, Texas Gas Service is required to file a full rate case. A full rate case may be filed at shorter intervals if desired by either the utility or the regulator.

• Cost of Service Adjustment (“COSA”) filings—In five service areas, comprising 19 percent of its customers, Texas Gas Service makes an annual COSA filing. COSA tariffs permit Texas Gas Service to recover return, taxes and depreciation on the annual increases in net investment, as well as annual increases or decreases in certain expenses and revenues. Four of the COSAs have no cap on increases related to investment and have caps of 3.5 percent or the change in the Consumer Price Index for expense increases. One COSA caps all increases at the increase in the Consumer Price Index. A full rate case may be filed when desired by the utility or the regulator, but is not required.

• WNA clause—Texas Gas Service employs WNA clauses in eight of its services areas, comprising 62 percent of its customers. In the single service area without WNA, Texas Gas Service recovers 84 percent of net margin from fixed charges, making revenues in this service area less weather-sensitive. WNA is designed to reduce customers’ bills for the additional volumes used when the actual heating degree days exceed the normalized heating degree days and to increase customers’ bills for the reduction in volumes used when actual heating degrees days are less than the normal heating degree days. The WNA is in effect from September through May.

• Cost of Gas (“COG”) clause—In all service areas, Texas Gas Service recovers 100 percent of its gas costs, including interest on storage and the natural gas cost component of bad debts, via a COG mechanism, subject to a limitation of 5 percent on lost and unaccounted for natural gas. The COG is reconciled annually to compare the revenues recovered through the COG with the actual natural gas supply costs and any over or under recovery is refunded or recovered, as applicable, in the subsequent year.

• Pension and OPEB—Texas Gas Service is authorized by statute to defer pension and other postretirement benefit costs that exceed the amount recovered in base rates, and to seek recovery of the deferred costs in a future rate case.

• Pipeline-Integrity Testing Riders—Texas Gas Service recovers approximately 90 percent of its pipeline-integrity testing expenses via riders, with the remainder included in base rates.

• Safety-Related Plant Replacements—Texas Gas Service is authorized by RRC rule to accrue a rate of return, taxes and depreciation expense on safety-related plant replacements from the time the replacements are in service until the plant is reflected in base rates, and to seek recovery of those accrued amounts in a future rate proceeding.

• Energy Conservation Program—Texas Gas Service has an Energy Conservation Program in its Central Texas service area, comprising 37 percent of total customers. Under the program, Texas Gas Service collects approximately $2 million per year from customers to fund the program, which provides energy audits, weatherization and appliance rebates to promote energy efficiency.

The average monthly residential customer charge for Texas Gas Service is $12.71, and approximately 70 percent of Texas Gas Services’ net margin from its sales customers recovered from fixed charges.

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Market Conditions and Seasonality

Supply. We purchased 140 Bcf and 163 Bcf of natural gas supply in 2012 and 2011, respectively. Our natural gas supply portfolio consists of long-term, seasonal and short-term contracts from a diverse group of suppliers. We award these contracts through competitive-bidding processes to ensure reliable and competitively priced natural gas supply. We acquire our natural gas supply from natural gas processors, natural gas marketers and natural gas producers.

An objective of our supply-sourcing strategy is to provide value to our customers through reliable, competitively priced and flexible natural gas supply and transportation purchases from multiple production areas and suppliers. This strategy is designed to mitigate the impact on our supply from physical interruption, financial difficulties of a single supplier, natural disasters and other unforeseen force majeure events, as well as to ensure these resources are reliable and flexible to meet the variations of customer demands.

We do not anticipate problems with securing natural gas supply to satisfy customer demand; however, if supply shortages were to occur, we have curtailment tariff provisions in place that allow us to reduce or discontinue natural gas service to large industrial users and to request that residential and commercial customers reduce their natural gas requirements to an amount essential for public health and safety. In addition, during times of critical supply disruptions, curtailments of deliveries to customers with firm contracts may be made in accordance with guidelines established by appropriate federal, state and local regulatory agencies.

Natural gas supply requirements are affected by weather conditions. In addition, economic conditions impact the requirements of our commercial and industrial customers. Natural gas usage per residential customer may decline as customers change their consumption patterns in response to a variety of factors, including:

• more volatile and higher natural gas prices, as discussed above;

• customers’ improving the energy efficiency of existing homes by replacing doors and windows and adding insulation, and replacing appliances with more efficient appliances;

• more energy-efficient construction; and

• fuel switching.

In each jurisdiction in which we operate, changes in customer-usage profiles are considered in the periodic redesign of our rates.

In managing our natural gas supply portfolios, we partially mitigate price volatility using a combination of financial derivatives and natural gas in storage. We have natural gas financial hedging programs that have been authorized by the regulatory authorities in each state in which we do business. We do not utilize financial derivatives for speculative purposes nor do we have trading operations associated with our business. As of September 30, 2013, we had 57.3 Bcf of natural gas storage capacity under lease with remaining terms ranging from one to five years and maximum allowable daily withdrawal capacity of approximately 1.5 Bcf. This storage capacity allows us to purchase natural gas during the off peak season and store it for use in the winter periods. Approximately 29 percent of our winter natural gas supply needs for our sales customers are expected to be supplied from storage.

Demand. See discussion below under “—Seasonality” and “—Competition” for factors affecting demand for our services.

Seasonality. Natural gas sales to residential and commercial customers are seasonal, as a substantial portion of their natural gas requirements are for heating. Accordingly, the volume of natural gas sales is higher normally during the months of November through March than in other months of the year. The impact on our margins resulting from weather that is above or below normal is offset partially through our weather normalization mechanisms. See discussion above under “—Regulatory Overview.”

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Competition. We encounter competition based on customers’ preference for natural gas, compared with other energy alternatives and their comparative prices. We compete to supply energy for space and water heating, cooking, clothes drying and other general energy needs. Significant energy usage competition occurs between natural gas and electricity in the residential and small commercial markets. Customers and builders typically make the decision on the type of equipment, and therefore the energy source, at initial installation, generally locking in the chosen energy source for the life of the equipment. Changes in the competitive position of natural gas relative to electricity and other energy alternatives have the potential to cause a decline in consumption of natural gas or in the number of natural gas customers.

The Department of Energy issued a statement of policy that it will use full fuel-cycle measures of energy use and emissions when evaluating energy-conservation standards for appliances. In addition, the Environmental Protection Agency has determined that source energy is the most equitable unit for evaluating energy consumption. Assessing energy efficiency in terms of a full fuel-cycle or source-energy analysis, which takes all energy use into account, including transmission, delivery and production losses, in addition to energy consumed at the site, highlights the high overall efficiency of natural gas in residential and commercial uses compared with electricity.

The below table contains data related to the cost of our delivered gas relative to electricity based on current market conditions:

Natural Gas vs. Electricity	Oklahoma			Kansas			Texas
Average retail price of electricity / kWh(1)		9.62	¢		11.64	¢		11.31	¢
Natural gas price equivalent of electricity / Dth(1)	$	28.19		$	34.11		$	33.15
ONE Gas delivered cost of natural gas / Dth(2)	$	11.01		$	10.51		$	9.83
Natural gas advantage ratio(3)		2.6	x		3.3	x		3.4	x

(1) Source: United States Energy Information Agency, www.eia.gov, for the eight-month period ended August 31, 2013.

(2) Represents the average delivered cost of natural gas to a residential customer, including the cost of the natural gas supplied, fixed customer charge, delivery charges and charges for riders, surcharges and other regulatory mechanisms associated with the services we provide, for the nine-month period ended September 30, 2013.

(3) Calculated as the ratio of the natural gas price equivalent per dekatherm of the average retail price of electricity per kilowatt hour to the ONE Gas delivered average cost of natural gas per dekatherm.

We are subject to competition from other pipelines for our large industrial and commercial customers, and this competition has and may continue to impact margins. Under our transportation tariffs, qualifying industrial and commercial customers are able to purchase their natural gas needs from the supplier of their choice and have us transport it for a fee. A portion of the transportation services that we provide are at negotiated rates that are below the maximum approved transportation tariff rates. Reduced rate transportation service may be negotiated when a competitive pipeline is in proximity or another viable energy option is available to the customer. Increased competition could potentially lower these rates.

Employees

Immediately following the separation, we anticipate employing approximately 3,100 people, including approximately 700 people at Kansas Gas Service who are subject to collective-bargaining agreements, as follows:

Union	Approximate Employees		Contract Expires
The United Steelworkers		400	October 28, 2016
International Brotherhood of Electrical Workers (IBEW)		300	June 30, 2014

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Properties and Facilities

We own approximately 19,000 miles of pipeline and other natural gas distribution facilities in Oklahoma; approximately 14,000 miles of pipeline and other natural gas distribution facilities in Kansas; and approximately 10,000 miles of pipeline and other natural gas distribution facilities in Texas. In addition, we have 57.3 Bcf of natural gas storage capacity under lease, with maximum allowable daily withdrawal capacity of approximately 1.5 Bcf/d.

Legal Proceedings

We are a party to various litigation matters and claims that have arisen in the normal course of our operations. While the results of litigation and claims cannot be predicted with certainty, we believe the reasonably possible losses from such matters, individually and in the aggregate, are not material. Additionally, we believe the probable final outcome of such matters will not have a material adverse effect on our results of operations, financial position or cash flows.

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ENVIRONMENTAL AND SAFETY MATTERS

Environmental Matters

We are subject to multiple historical, wildlife preservation and environmental laws and/or regulations, which affect many aspects of our present and future operations. Regulated activities include, but are not limited to, those involving air emissions, storm water and wastewater discharges, handling and disposal of solid and hazardous wastes, wetland preservation, hazardous materials transportation, and pipeline and facility construction. These laws and regulations require us to obtain and/or comply with a wide variety of environmental clearances, registrations, licenses, permits and other approvals. Failure to comply with these laws, regulations, licenses and permits may expose us to fines, penalties and/or interruptions in our operations that could be material to our results of operations. In addition, emission controls and/or other regulatory or permitting mandates under the Clean Air Act and other similar federal and state laws could require unexpected capital expenditures at our facilities. We cannot assure that existing environmental statutes and regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional statutes or regulations that result in increased compliance costs or additional operating restrictions could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Pipeline Safety

We are subject to PHMSA regulations, including integrity-management regulations. The Pipeline Safety Improvement Act requires pipeline companies operating high-pressure pipelines to perform integrity assessments on pipeline segments that pass through densely populated areas or near specifically designated high-consequence areas. In January 2012, The Pipeline Safety, Regulatory Certainty and Job Creation Act was signed into law. The new law increased maximum penalties for violating federal pipeline safety regulations and directs the DOT and Secretary of Transportation to conduct further review or studies on issues that may or may not be material to us. These issues include but are not limited to the following:

• an evaluation on whether natural gas pipeline integrity-management requirements should be expanded beyond current high-consequence areas;

• a verification of records for pipelines in class 3 and 4 locations and high-consequence areas to confirm maximum allowable operating pressures; and

• a requirement to test previously untested pipelines operating above 30 percent yield strength in high-consequence areas.

The potential capital and operating expenditures related to this legislation, the associated regulations or other new pipeline safety regulations are unknown.

Air and Water Emissions

The Clean Air Act, the Clean Water Act, analogous state laws and/or regulations promulgated thereunder, impose restrictions and controls regarding the discharge of pollutants into the air and water in the United States. Under the Clean Air Act, a federally enforceable operating permit is required for sources of significant air emissions. We may be required to incur certain capital expenditures for air-pollution-control equipment in connection with obtaining or maintaining permits and approvals for sources of air emissions. The Clean Water Act imposes substantial potential liability for the removal of pollutants discharged to waters of the United States and remediation of waters affected by such discharge.

Federal, state and regional initiatives to measure and regulate greenhouse gas emissions are under way. We monitor all relevant federal and state legislation to assess the potential impact on our operations. The EPA’s Mandatory Greenhouse Gas Reporting Rule requires annual greenhouse gas emissions reporting as carbon dioxide equivalents from affected facilities and for the natural gas delivered by us to our natural gas distribution

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customers who are not otherwise required to report their own emissions. Our 2012 total reported emissions were approximately 11.9 million metric tons of carbon dioxide equivalents. This total includes the carbon dioxide equivalents from natural gas delivered to customers as if all such gas were combusted and the carbon dioxide equivalents of certain fugitive methane emissions from our pipelines. The additional cost to gather and report this emission data did not have, and we do not expect it to have, a material impact on our results of operations, financial position or cash flows. In addition, Congress has considered, and may consider in the future, legislation to reduce greenhouse gas emissions, including carbon dioxide and methane. Likewise, the EPA may institute additional regulatory rulemaking associated with greenhouse gas emissions. At this time, no rule or legislation has been enacted that assesses any costs, fees or expenses on any of these emissions.

The EPA’s rule on air-quality standards titled, “National Emission Standards for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines” included a compliance date in October 2013. We do not expect expenditures required to comply with this rule to have a material impact on our results of operations, financial position or cash flows.

CERCLA

The federal Comprehensive Environmental Response, Compensation and Liability Act, also commonly known as Superfund, imposes strict, joint and several liability, without regard to fault or the legality of the original act, on certain classes of “persons” (defined under CERCLA) that caused and/or contributed to the release of a hazardous substance into the environment. These persons include but are not limited to the owner or operator of a facility where the release occurred and/or companies that disposed or arranged for the disposal of the hazardous substances found at the facility. Under CERCLA, these persons may be liable for the costs of cleaning up the hazardous substances released into the environment, damages to natural resources and the costs of certain health studies. We do not expect that our responsibilities under CERCLA will have a material impact on our respective results of operations, financial position or cash flows.

Pipeline Security

The United States Department of Homeland Security’s Transportation Security Administration issued updated pipeline security guidelines in April 2012. Our pipeline facilities have been reviewed according to the current guidelines and no material changes have been required to date.

Environmental Footprint

Our environmental and climate change strategy focuses on taking steps to minimize the impact of our operations on the environment. These strategies include: (1) developing and maintaining an accurate greenhouse gas emissions inventory according to current rules issued by the EPA; (2) improving the efficiency of our various pipelines; (3) following developing technologies for emission control; and (4) utilizing practices to reduce the loss of methane from our facilities.

We participate in the EPA’s Natural Gas STAR Program to voluntarily reduce methane emissions. We continue to focus on maintaining low rates of lost-and-unaccounted-for natural gas through expanded implementation of best practices to limit the release of natural gas during pipeline and facility maintenance and operations.

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MANAGEMENT

Executive Officers Following the Distribution

While some of our expected executive officers are currently officers and employees of ONEOK, upon the separation and distribution, none of these individuals will continue to be employees of ONEOK. The following table sets forth information regarding individuals who currently serve and will continue to serve as our executive officers following the distribution.

Name	Age*		Position
Pierce H. Norton II		53	President, Chief Executive Officer, Director
Curtis L. Dinan		46	Senior Vice President, Chief Financial Officer, and Treasurer
Joseph L. McCormick		54	Senior Vice President, General Counsel, and Assistant Secretary
Caron A. Lawhorn		52	Senior Vice President, Commercial
Gregory A. Phillips		50	Senior Vice President, Operations

* As of December 1, 2013

Pierce H. Norton II is expected to become our president and chief executive officer and a director of the company. Since January 1, 2013, Mr. Norton served as executive vice president, commercial, of ONEOK and ONEOK Partners from January 1, 2013, and prior to that was executive vice president and chief operating officer of ONEOK and ONEOK Partners from January 1, 2012, to December 31, 2012. In 2011, Mr. Norton served as chief operating officer of ONEOK and was responsible for ONEOK’s natural gas distribution and energy services business segments, as well as the environment, safety and health, and technical services organizations. Previously, from July, 2009 to March, 2011 he was president of ONEOK’s distribution companies, Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, each of which will become a part of the company following the distribution, and was executive vice president of natural gas, with responsibility for all natural gas pipelines and the natural gas gathering and processing businesses within ONEOK Partners. He began his natural gas industry career in 1982 at Delhi Gas Pipeline, a subsidiary of Texas Oil and Gas Corporation. He later worked for American Oil and Gas with operational responsibilities for natural gas gathering and processing, and intrastate and interstate pipelines. He then worked for KN Energy as vice president and general manager of the Heartland Region, before moving to Bear Paw Energy as vice president of business development. In 2002, he was named president of Bear Paw Energy, now ONEOK Rockies Midstream, a subsidiary of ONEOK Partners. Mr. Norton earned a Bachelor of Science degree in mechanical engineering in 1982 from the University of Alabama in Tuscaloosa. He also is a graduate of the Harvard Business School’s Advanced Management Program.

Curtis L. Dinan is expected to become our senior vice president, chief financial officer and treasurer. Since March 2011, he has served as senior vice president, natural gas of ONEOK Partners with responsibility for ONEOK Partners’ commercial activities in its natural gas gathering and processing and natural gas pipelines segments. From January 2007 until March 2011, Mr. Dinan was senior vice president, chief financial officer and treasurer of ONEOK and ONEOK Partners. Mr. Dinan was also a member of the ONEOK Partners board of directors of Directors from October 2007 until March 2011. He joined ONEOK in 2004 as vice president and chief accounting officer, after being an audit partner with both Arthur Andersen LLP and Grant Thornton LLP. Mr. Dinan has served on the boards of directors of the Interstate Natural Gas Association of America and the Texas Pipeline Association. Mr. Dinan is a member of the American Institute of Certified Public Accountants and the Oklahoma Society of CPAs. Mr. Dinan earned Bachelor of Arts degrees in both accounting and business administration in 1989 from Drury University. He also is a graduate of the Harvard Business School’s Advanced Management Program.

Joseph L. McCormick is expected to become our senior vice president, general counsel and assistant secretary. Since January 2008 he served as vice president and associate general counsel of ONEOK and was

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responsible for legal matters of ONEOK’s natural gas distribution segment—Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, each of which will become a part of our company following the distribution. Mr. McCormick joined ONEOK in 2003 as the managing attorney of Oklahoma Natural Gas. Prior to that, he served as an assistant attorney general with the Oklahoma attorney general’s office and as an assistant general counsel with the Oklahoma Insurance Department. Mr. McCormick is a graduate of Leadership Tulsa—Class 46. He also has served as a board member of the Oklahoma Individual Self-Insured Guaranty Fund, the Urban League of Greater Oklahoma City, the Lyric Theatre and the Oklahoma Huntington Disease Society. Mr. McCormick is a member of the Oklahoma Bar Association and the Association of Corporate Counsel. Mr. McCormick earned a Bachelor of Arts degree in public administration in 1984 from the University of Central Oklahoma in Edmond and a Juris Doctorate in 1987 from the University of Oklahoma College of Law in Norman.

Caron A. Lawhorn is expected to become our senior vice president of commercial. Since January 2013, she served as senior vice president, commercial, natural gas distribution of ONEOK. From March 2011 to December 2012, she was president of ONEOK’s distribution companies. In 2009, she was named senior vice president, corporate planning and development of ONEOK and ONEOK Partners, responsible for business development, strategic and long-range planning and capital investment. She was named senior vice president and chief accounting officer of ONEOK in 2007, adding responsibility for ONEOK Partners in 2008. Prior to that, she was senior vice president of financial services and treasurer of ONEOK from 2005 to 2006. She joined ONEOK in 1998 as manager of auditing, after serving as a senior manager at KPMG and chief financial officer of Emergency Medical Services Authority in Tulsa. She is a member of the American Institute of Certified Public Accountants, the boards of directors of the Southern Gas Association and the Tulsa Area United Way and is executive chair of the board of trustees of Saint Simeon’s Episcopal Home. Ms. Lawhorn earned her Bachelor of Science degree in business administration from the University of Tulsa, where she was named an Outstanding Alumna in the College of Business. She also is a graduate of the Harvard Business School’s Advanced Management Program, as well as of the Leadership Oklahoma and Leadership Tulsa programs.

Gregory A. Phillips is expected to become our senior vice president of operations. Since January 2013, he has served as senior vice president, operations, natural gas distribution of ONEOK. From March 2011 to December 2012, he was president of Oklahoma Natural Gas Company. He was president of Texas Gas Service from July 2008 until March 2011. Mr. Phillips joined Oklahoma Natural Gas in 1986 as an engineer trainee. He has held several operational roles, including manager of operations of ONEOK Gas Transportation and ONEOK WesTex Transmission; vice president of natural gas supply of ONEOK Field Services; and regional vice president of Texas Gas Service in Austin. Mr. Phillips earned a Bachelor of Science degree in petroleum engineering in 1985 from the University of Tulsa.

Board of Directors Following the Distribution

The following sets forth information with respect to those persons, in addition to Mr. Norton, who are expected to serve on our board of directors (our “board of directors”) following the completion of the distribution. The nominees will be presented to our sole shareholder, ONEOK, for election prior to the distribution. We intend to name and present additional nominees for election prior to the distribution.

Name	Age*		Class	Position(s)
John W. Gibson		61		Non-Executive Chairman Director
Pierce H. Norton II		53		Director
*  As of December 1, 2013.

John W. Gibson is expected to become non-executive chairman of our board of directors. He is also expected to become non-executive chairman of the board of directors of each of ONEOK and ONEOK Partners.

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He most recently served as chief executive officer of ONEOK and as chief executive officer of ONEOK Partners GP, L.L.C., the general partner of ONEOK Partners, from 2007 to                 ,     . From 2005 until May 2006, he was president of ONEOK Energy Companies, which included ONEOK’s gathering and processing, natural gas liquids, pipelines, and storage and energy services business segments, some of which were acquired by ONEOK Partners in April 2006. Prior to that, he was ONEOK’s president, energy, from May 2000 to 2005. Mr. Gibson joined ONEOK in May 2000 from Koch Energy, Inc., a subsidiary of Koch Industries, where he was an executive vice president. His career in the energy industry began in 1974 as a refinery engineer with Exxon USA. He spent 18 years with Phillips Petroleum Company in a variety of domestic and international positions in its natural gas, natural gas liquids and exploration and production businesses, including vice president of marketing of its natural gas subsidiary GPM Gas Corp. He holds an engineering degree from Missouri University of Science and Technology, formerly known as the University of Missouri at Rolla. Mr. Gibson also serves on the board of directors of BOK Financial Corporation. Mr. Gibson has served in a variety of roles of continually increasing responsibility at ONEOK since 2000, ONEOK Partners GP, L.L.C. since 2004 and, prior to 2000, at Koch Energy, Inc., Exxon USA and Phillips Petroleum. In these roles, Mr. Gibson has had direct responsibility for and extensive experience in strategic and financial planning, acquisitions and divestitures, operations, management supervision and development, and compliance. As the executive responsible for numerous merger and acquisition transactions over the course of his career, Mr. Gibson has significant experience in assessing acquisition opportunities and in structuring, financing and completing merger and acquisition transactions. Over the course of his lengthy career in a variety of sectors of the oil and gas industry, Mr. Gibson has gained extensive management and operational experience and has demonstrated a strong track record of leadership, strategic vision and risk management.

Pierce H. Norton II is expected to become a member of our board of directors. Information regarding Mr. Norton’s employment and qualifications to serve on our board is set forth above under the section entitled “—Executive Officers Following the Distribution.”

Committees

Effective upon the completion of the distribution, our board of directors will have the following committees:

The Audit Committee

The Audit Committee will represent and assist our board of directors with the oversight of the integrity of our financial statements and internal controls, our compliance with legal and regulatory requirements, the independence, qualifications and performance of our independent registered public accounting firm and the performance of our internal audit function. The responsibilities of the Audit Committee include:

• appointing, compensating and overseeing our independent auditor;

• reviewing the scope, plans and results relating to the internal and external audits and our financial statements;

• monitoring and evaluating our financial condition;

• monitoring and evaluating the integrity of our financial reporting processes and procedures;

• assessing our significant financial risks and exposures and evaluating the adequacy of our internal controls in connection with such risks and exposures, including, but not limited to, internal controls over financial reporting and disclosure controls and procedures;

• reviewing policies and procedures on risk-control assessment and accounting risk exposure, including our companywide risk-control activities and our business-continuity and disaster-recovery plans; and

• monitoring our compliance with our policies on ethical business conduct.

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Following the separation,                      will be the chairman of our audit committee, and the other members of our audit committee will be Messrs.                     ,                      and                     , each of whom our board of directors has determined is an independent director. Our board of directors has determined that                      is an “audit committee financial expert” under the requirements of the NYSE and the SEC.

The Executive Compensation Committee

Our Executive Compensation Committee is responsible for establishing and periodically reviewing our executive compensation policies and practices. This responsibility includes:

• evaluating, in consultation with our Corporate Governance Committee, the performance of our chief executive officer, and recommending to our board of directors the compensation of our chief executive officer and our other senior executive officers;

• reviewing and approving, in consultation with our Corporate Governance Committee, the annual objectives of our chief executive officer;

• reviewing our executive compensation program to ensure the attraction, retention and appropriate compensation of executive officers in order to motivate their performance in the achievement of our business objectives and to align their interests with the long-term interests of our shareholders;

• assessing the risks associated with our compensation program; and

• reviewing and making recommendations to the full board of directors on executive officer and director compensation and personnel policies, programs and plans.

Following the separation,                      will be the chairman of our Executive Compensation Committee, and the other members of our Executive Compensation Committee will be Messrs.                     ,                      and                     , each of whom our board of directors has determined is an independent director.

The Corporate Governance Committee

Our Corporate Governance Committee is responsible for overseeing our company’s governance, including the selection of directors and our board of directors’ practices and effectiveness. These responsibilities include:

• identifying and recommending qualified director candidates, including qualified director candidates suggested by our shareholders in written submissions to our corporate secretary in accordance with our corporate governance guidelines and our bylaws or in accordance with the rules of the SEC;

• making recommendations to our board of directors with respect to electing directors and filling vacancies on our board of directors;

• adopting an effective process for director selection and tenure by making recommendations on our board of directors’ organization and practices and by aiding in identifying and recruiting director candidates;

• reviewing and making recommendations to our board of directors with respect to the organization, structure, size, composition and operation of our board of directors and its committees;

• in consultation with the Chairman of our board of directors and chief executive officer and the Executive Compensation Committee, overseeing management succession and development; and

• reviewing, assessing risk and making recommendations with respect to other corporate governance matters.

Following the separation,                      will be the chairman of our Corporate Governance Committee, and the other members of our Corporate Governance Committee will be Messrs.                     ,                      and                     , each of which our board of directors has determined is an independent director.

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The Executive Committee

In the intervals between meetings of our board of directors, the Executive Committee may, except as otherwise provided in our bylaws and applicable law, exercise the powers and authority of the full board of directors in the management of our property, affairs and business. The function of this committee is to act on major matters where it deems action appropriate, providing a degree of flexibility and ability to respond to time-sensitive business and legal matters without calling a special meeting of our full board of directors. The Executive Committee reports to our board of directors at its next meeting on any actions taken by the committee.

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EXECUTIVE COMPENSATION

ONE Gas is currently part of ONEOK and not an independent company, and its compensation committee has not yet been constituted. Decisions as to the past compensation of those who currently serve as its officers have been made by ONEOK. This Compensation Discussion and Analysis discusses these historical compensation practices and outlines certain aspects of ONE Gas’ anticipated compensation structure for its executive officers following the separation.

The five persons who we expect will be our named executive officers and their positions with ONE Gas as of the separation and distribution are:

Named Executive Officer	Title
Pierce H. Norton II	President and Chief Executive Officer
Curtis L. Dinan	Senior Vice President, Chief Financial Officer and Treasurer
Caron A. Lawhorn	Senior Vice President, Commercial
Gregory A. Phillips	Senior Vice President, Operations
Joseph L. McCormick	Senior Vice President, General Counsel and Assistant Secretary

For purposes of the following Compensation Discussion and Analysis, we refer to them collectively as our “Named Executive Officers.” Prior to the separation, each of our Named Executive Officers was employed by ONEOK or its subsidiaries; therefore, the information provided for the years 2013, 2012 and 2011 reflects compensation earned at ONEOK or its subsidiaries and the design and objectives of the executive compensation programs in place prior to the separation.

Compensation decisions for our Named Executive Officers prior to the separation have been made by ONEOK. To the extent such persons are senior officers of ONEOK, the decisions have been made by the Executive Compensation Committee of ONEOK (the “Committee”), which is composed entirely of independent directors. Executive compensation decisions following the separation will be made by the Executive Compensation Committee of ONE Gas (our “Executive Compensation Committee”). While ONE Gas has discussed its anticipated programs and policies with the Committee, they remain subject to the review and approval of our Executive Compensation Committee.

Information that will not be available until after December 31, 2013, will be included in a subsequent amendment.

COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis addresses the following three subjects:

• ONEOK’s 2013 executive compensation programs as applied to our Named Executive Officers;

• ONE Gas’s anticipated executive compensation programs; and

• Effects of the separation on outstanding executive compensation awards for our Named Executive Officers.

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ONEOK’s 2013 Executive Compensation

Specific Compensation Program Features—Historical

ONEOK’s compensation philosophy and related governance features are complemented by several specific elements that are designed to align its executive compensation with long-term shareholder interests.

• The main objectives of ONEOK’s compensation program are to pay for performance, to align its executive officers’ interests with those of its shareholders and to attract and retain qualified executives;

• The Committee makes all compensation decisions regarding ONEOK’s named executive officers that are then submitted to the full board of directors for ratification;

• The Committee is composed solely of independent directors;

• ONEOK provides the following primary elements of compensation for its named executive officers: base salary, short-term cash incentive and long-term equity-based incentives;

• ONEOK references the median level of the market when determining all elements of compensation with the possibility of above-market short-term incentive and long-term incentive payments for executive and company performance that exceeds expectations;

• ONEOK implements a pay-for-performance philosophy with a short-term incentive program that provides for cash payments based on achievement of financial and operational goals established annually by the Committee;

• ONEOK encourages alignment of its named executive officers’ interests with those of its shareholders through the award of performance-based long-term incentive equity grants;

• ONEOK’s executive officers, including the named executive officers, receive no significant perquisites or other personal benefits;

• ONEOK has market competitive stock ownership guidelines for its executive officers, including the named executive officers;

• ONEOK has adopted clawback provisions that permit the Committee to use appropriate discretion to seek recoupment of grants of performance units (including any shares earned and the proceeds from any sale of such shares) and short-term cash incentive awards paid to employees in the event of any fraud, negligence or intentional misconduct by such employees that is determined to be a contributing factor to its having to restate all or a portion of its financial statements;

• ONEOK’s board has adopted a policy prohibiting all employees, including the named executive officers, and members of its board of directors, from selling short or engaging in transactions in put or call options relating to securities of ONEOK. This policy was adopted as a sound governance practice;

• The Committee engages an independent executive compensation consultant to provide advice and expertise on its executive and director compensation program design and implementation. The Committee’s independent executive compensation consultant, Meridian Compensation Partners, is retained directly by the Committee and performs no other services for ONEOK;

• The Committee regularly meets in executive session with and without the representatives of the Committee’s independent executive compensation consultant; and

• The Committee conducts an annual review and approval of ONEOK’s compensation program to ensure that the risks arising from the program are not reasonably likely to have a material adverse effect on ONEOK.

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Specific Compensation Program Features—Going Forward

We expect that the features of our executive compensation programs initially will be similar to those in place at ONEOK immediately prior to the separation. Following the separation, our Executive Compensation Committee will consider, develop and refine our compensation structure, practices and procedures in order to effectively meet our business needs and goals and to attract and retain qualified executives.

Executive Compensation Philosophy—Historical

ONEOK’s executive compensation philosophy is based on the following core elements: paying for performance and providing a competitive compensation package to attract and retain qualified executives, while ensuring that its compensation program does not provide incentives for excessive risk taking.

Pay-for-Performance

ONEOK structures its compensation program to align the interests of its employees, including its named executive officers, with the interests of its shareholders. A significant part of each executive’s pay is “at risk,” in the form of an annual short-term incentive award and long-term, equity-based incentive grants. The amount of the annual short-term incentive award paid depends on ONEOK’s performance against financial and operating objectives, as well as the executive meeting key leadership, development and performance standards. The portion of ONEOK’s executives’ compensation in the form of equity awards ties their compensation directly to creating shareholder value over the long term.

Competitive Pay

When targeted levels of performance are achieved, ONEOK seeks to pay experienced executives at approximately the median level of total compensation for energy companies and other organizations with which ONEOK competes for executive talent. In certain circumstances, ONEOK may target pay above or below the competitive median. For example, to recognize an executive’s unique qualifications or performance, ONEOK may choose to set the executive’s expected pay level above the median; however, if the executive is new to the role, ONEOK may set his or her expected pay below the median level.

ONEOK’s compensation program is designed with the following principles in mind:

• pay its employees equitably and fairly relative to one another and industry peers based on their responsibilities, capabilities, experience, performance demonstrated and market conditions;

• motivate its executives to perform with the highest integrity for the benefit of its shareholders;

• conduct its business and manage its assets in a safe and environmentally responsible manner;

• promote a non-discriminatory work environment that enables it to benefit from the diversity of thought that comes with a diverse and inclusive workforce; and

• continue its focus on sound governance practices by implementing executive compensation best practices and policies.

Risk Assessment

The Committee believes that ONEOK’s compensation program does not provide incentives for excessive risk-taking and, therefore, does not produce risks that are reasonably likely to have a material adverse effect on ONEOK for the following reasons:

• ONEOK’s compensation program is the same for all officers and employees across all of its business units;

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• ONEOK’s base salary is market-based and does not encourage risk-taking because it is a fixed amount; and

• ONEOK’s current short- and long-term incentive plan awards have the following risk-limiting characteristics:

• awards to each executive officer are subject to fixed maximums established by the Committee;

• awards are based on a variety of performance indicators, thus diversifying the risk associated with any single performance indicator;

• short- and long-term incentive awards are not tied to formulas that could focus executives on specific short-term outcomes;

• the Committee approves the final incentive plan award payouts after it reviews and confirms individual executive, operating and financial performance;

• short-term cash and long-term performance-unit incentive awards are subject to clawback provisions;

• for executive officers, a significant portion of incentive award value is delivered in the form of ONEOK common stock that vests over multiple years, which aligns the interests of executive officers to long-term shareholder interests; and

• executive officers are subject to ONEOK’s share-ownership guidelines.

Executive Compensation Philosophy—Going Forward

We expect that our executive compensation philosophy initially will be similar to that of ONEOK immediately prior to the separation. Following the separation, our Executive Compensation Committee will consider, develop and refine our compensation philosophy.

Compensation Methodology—Historical

The Committee. The Committee is responsible for reviewing and recommending ONEOK’s executive compensation program to the full board of directors of ONEOK. The Committee is composed entirely of individuals who qualify as independent directors under the NYSE listing standards. The Committee’s role is to oversee ONEOK’s compensation and benefit plans and policies, direct the administration of these plans and review and approve annually all compensation decisions relating to its executive officers, including compensation decisions for its named executive officers.

The Committee reviews its executive officer compensation program and makes specific decisions in February of each year to approve base salaries, to ratify the achievement of short-term cash incentive goals for the prior year, to approve short-term cash incentive program targets for the upcoming fiscal year, to approve the level of vesting of long-term incentive grants and to approve new long-term incentive grants. This timing coincides with ONEOK’s board of directors’ review of its financial and operating results for the most recently completed year and allows the Committee to consider those results, as well as its financial and operating plan for the upcoming year, as it makes compensation decisions. The Committee submits its decisions regarding compensation of ONEOK’s Chief Executive Officer, ONEOK’s other executive officers and ONEOK’s non-management directors to the board of directors of ONEOK for ratification.

The Committee recognizes the importance of maintaining sound basic principles for the development and administration of ONEOK’s compensation and benefit programs. The Committee has adopted practices to enhance its ability to carry out effectively its responsibilities, as well as ensure that ONEOK maintains strong links between executive pay and performance. Examples of practices the Committee has adopted include:

• holding executive sessions without company management present at every in-person meeting of the Committee;

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• reviewing, annually, detailed compensation tally sheets for the named executive officers;

• engaging an independent executive compensation consultant to advise the Committee on executive compensation issues;

• meeting with the independent executive compensation consultant in executive session at each regularly scheduled in-person Committee meeting to discuss the compensation program and actions on a confidential basis;

• evaluating the Committee’s performance each year; and

• assessing the performance of the Committee’s independent executive compensation consultant each year and providing feedback as appropriate.

The Role of Executive Management in the Executive Compensation Process. Each year, ONEOK’s executive management presents its annual strategic and financial plan to its board of directors for approval. The presentation includes a review of the expected financial and operating performance of each of its business segments, the expected financial performance of ONEOK on a consolidated basis, the capital expenditure plan and a consolidated three-year strategic and financial plan. Executive management recommends to the Committee the criteria and targets for ONEOK’s annual short-term cash incentive awards based on the Board-approved strategic and financial plan, as well as management’s judgment regarding the challenges facing ONEOK’s business segments, economic trends related to these businesses and the overall economy. Following each fiscal year, and once financial and operating results are final, executive management reviews ONEOK’s actual performance relative to the criteria and targets established for the performance year to determine the short-term cash incentive awards to be recommended to the Committee for each executive.

In making individual compensation decisions, the Committee reviews the recommendations from ONEOK’s chief executive officer with respect to all named executive officers other than himself. The Committee reviews and discusses these recommendations in executive session and reaches its own decision with respect to the compensation of the chief executive officer. In turn, the Committee submits its compensation decisions with respect to the chief executive officer and the other named executive officers to ONEOK’s full board of directors for ratification.

ONEOK’s corporate human resources department supports both the Committee and senior management in establishing management’s recommendations regarding annual performance targets and providing periodic analyses and research regarding ONEOK’s executive compensation program.

The Role of the Independent Executive Compensation Consultant. The Committee has the authority under its charter to engage the services of outside advisors, experts and others to assist the Committee in the performance of its duties. During 2013, the Committee engaged Meridian Compensation Partners to serve as the Committee’s independent executive compensation consultant on matters related to executive and director compensation. The independent executive compensation consultant reports directly to the Committee and provides no other services to ONEOK.

The Committee annually reviews and establishes the scope of the engagement of the Committee’s executive compensation consultant that is reflected in an annual engagement letter between the consultant and the Committee. During 2013, the scope of the assignment and the material instructions regarding the services of the executive compensation consultant were:

• provide advice to the Committee with respect to executive compensation matters in light of ONEOK’s business strategy, pay philosophy, prevailing market practices, shareholder interests and relevant regulatory mandates;

• provide advice on ONEOK’s executive pay philosophy;

• provide advice on ONEOK’s compensation peer group for competitive benchmarking;

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• provide comprehensive competitive market studies as background against which the Committee considers base salary, annual cash incentive opportunity and long-term incentive awards for ONEOK’s chief executive officer and senior management;

• provide incentive plan design advice for both annual and various long-term incentive vehicles and other compensation and benefit programs that meet company objectives;

• apprise the Committee about emerging best practices and changes in the regulatory and corporate governance environment;

• provide advice and competitive market data on director compensation matters;

• attend periodic meetings with representatives of ONEOK’s human resources and legal departments as required from time to time to discuss executive compensation issues and prepare for Committee meetings;

• assist with preparation of the “Executive Compensation Discussion and Analysis” to be included in ONEOK’s annual proxy statement;

• assist with the Committee’s review of compensation tally sheets for ONEOK’s chief executive officer and the direct reports to ONEOK’s chief executive officer; and

• periodically review the Committee’s charter.

In addition, the engagement letter requests that the consultant be available to assist the Committee with respect to other executive compensation matters that may arise throughout the year.

The executive compensation consultant attended each regularly scheduled in-person meeting of the Committee in 2013. During a portion of each regular, in-person meeting, the executive compensation consultant met with the Committee in executive session without members of management present. The executive compensation consultant also communicates with members of the Committee outside of the Committee’s meetings as desired by the Committee members. The executive compensation consultant reviews briefing materials, including those with respect to individual compensation matters prepared by management for the Committee, reviews recommendations and proposals being submitted to the Committee and provides perspective, advice and recommendations to the Committee regarding the recommendations of management. The executive compensation consultant also gathers and provides competitive market data and other background information for the Committee’s consideration.

ONEOK’s Senior Vice President—Administrative Services and Corporate Relations and its Vice President, Associate General Counsel and Secretary worked with the executive compensation consultant from time to time during the year as necessary to support the work of the executive compensation consultant on behalf of the Committee. During 2013, ONEOK’s chief executive officer did not meet separately with the executive compensation consultant but did meet with the executive compensation consultant at regularly scheduled meetings of the Committee attended by ONEOK’s chief executive officer.

It is the Committee’s view that its executive compensation consultant should be able to render candid and direct advice independent of management’s influence and numerous steps have been taken to satisfy this objective. The executive compensation consultant is engaged by and reports directly to the Committee on matters related to executive and director compensation. As noted above, representatives of the executive compensation consultant meet separately with the Committee members outside the presence of management at each regular, in-person meeting and also speak separately with the Committee chair and other Committee members between meetings, as necessary or desired. The executive compensation consultant interacts from time to time directly with representatives of ONEOK’s human resources and legal departments in compensation-related activities such as compensation data collection and analysis, and interpretation and application of new regulatory requirements. The interactions of the executive compensation consultant with management are limited to those that are on the Committee’s behalf or related to proposals that will be presented to the Committee for review and approval.

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At least annually, the Committee conducts a review of the executive compensation consultant’s performance and independence. This review includes an evaluation of the services that the executive compensation consultant has provided to the Committee, the related fees and the procedures implemented by the executive compensation consultant with respect to maintaining its independence. During 2013, Meridian Compensation Partners advised the Committee regarding the effect of the separation on outstanding ONEOK compensation awards and executive and director compensation for ONE Gas following the separation. ONEOK paid fees of $            to Meridian Compensation Partners for services rendered to the Committee in 2013.

In February 2013, the Committee considered the independence of Meridian Compensation Partners in light of new SEC rules and proposed NYSE listing standards regarding the independence of consultants to compensation committees. The Committee requested and received a letter from Meridian Compensation Partners addressing the consulting firm’s independence, including the following factors: (1) other services provided to ONEOK by the consultant; (2) fees paid by ONEOK as a percentage of the consulting firm’s total revenue; (3) policies or procedures maintained by the consulting firm that are designed to prevent a conflict of interest; (4) any business or personal relationships between the individual consultants involved in the engagement and a member of the Committee; (5) any company stock owned by the individual consultants involved in the engagement; and (6) any business or personal relationships between our executive officers and the consulting firm or the individual consultants involved in the engagement. The Committee discussed these considerations and concluded that the work of the consultant did not raise any conflict of interest and that the consultant was independent of the Committee and ONEOK.

Competitive Benchmarking. For 2013 compensation decisions, the Committee asked Meridian Compensation Partners to assist it with the annual benchmarking and competitive assessment of its executive compensation program. The Committee reviewed independent executive compensation data compiled by Meridian Compensation Partners to assess competitive executive compensation levels for our executive officers. The survey data provided annual base salary, annual incentive opportunities and long-term incentive compensation opportunities among participating companies.

The Committee considers a number of factors in structuring ONEOK’s compensation program and making compensation decisions. This includes the compensation practices of select peer companies in the energy industry. These companies were chosen by the Committee after considering the recommendations of Meridian Compensation Partners and management, and were selected because they have significant lines of business in the energy industry that are similar to ONEOK’s businesses and because the size of their operations and the skills and experience required of their senior management to effectively operate their businesses are also similar to ONEOK’s businesses. The Committee believes that reference to these peers is appropriate when reviewing ONEOK’s compensation program because ONEOK competes with these companies for executive talent. The Committee reviews the composition of the peer groups at least annually. ONEOK used the following peer group when determining the 2013 compensation of our Chief Executive Officer:

AGL Resources, Inc.	Atmos Energy Corp.	CenterPoint Energy, Inc.
Enbridge, Inc.	Energy Transfers Partners, LP	Enterprise Products Partners LP
EQT Corp.	Integrys Energy Group, Inc.	Kinder Morgan Energy Partners LP
Magellan Midstream Partners, LP	MarkWest Energy Partners, LP	MDU Resources Group, Inc.
National Fuel Gas Co.	NiSource, Inc.	OGE Energy Corp.
Questar Corp.	Sempra Energy	Spectra Energy Corp.
Targa Resources Partners, LP	TransCanada Corp.	Williams Companies, Inc.

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ONEOK used the following peer group when determining the 2013 compensation of our Named Executive Officers other than our Chief Executive Officer:

AGL Resources, Inc.	Ameren Corporation	American Electric Power
Calpine Corporation	CenterPoint Energy, Inc.	Cleco Corporation
CMS Energy Corp	Dominion Resources, Inc.	DTE Energy Company
Energy Transfers Partners, LP	Entergy Corp.	Ferrellgas Partners LP
FirstEnergy Corp.	Kinder Morgan Inc.	NiSource, Inc.
NRG Energy, Inc.	OGE Energy Corp.	PG&E Corp.
Portland General Electric Company	PPL Corp.	SCANA Corp.
Sempra Energy	Southern Company	Spectra Energy Corp.
WGL Holdings, Inc.	Williams Companies, Inc.

The Committee attempts to set the compensation of ONEOK’s executive officers at levels that are competitive with the peer groups and uses market comparison data regarding these companies as a guide, including proxy information from these companies, as well as compensation survey data provided by Aon Hewitt’s Total Compensation Measurement Executive Survey. The Committee reviews the median salary, annual cash incentive and long-term equity compensation (and the combined total of these elements) of persons holding the same or similar positions at the peer groups, based on the most recent market data available. The Committee then generally seeks to set the compensation of its executive officers for each of these elements within a competitive range of the median, assuming payout of performance-based compensation at target. An executive’s actual compensation may vary from the target amount set by the Committee based on individual and the company performance, as well as changes in ONEOK’s stock price. The use of market comparison data, however, is just one of the tools the Committee uses to determine executive compensation, and the Committee retains the flexibility to set target compensation at levels it deems appropriate for an individual or for a specific element of compensation.

To assess the relative competitiveness of compensation for each named executive officer, the Committee’s established practice is to review the peer group base salary and short-term incentive compensation survey results for the 25th, 50th and 75th percentiles. Because 2013 base salary and annual short-term incentive target amounts established by the Committee for the named executive officers were between the 25th and 75th percentiles, the Committee determined that they fell within the Committee’s established parameters.

The Committee’s established practice also is to review the 25th, 50th and 75th percentiles survey results for long-term incentives to evaluate ONEOK’s annual long-term, equity-based incentive targets. Based on that review, the Committee determined that the 2013 long-term, equity-based grants to each of the named executive officers were also between the 25th and 75th percentiles, and, accordingly, also fell within the Committee’s established parameters.

Tally Sheets. To better understand the total executive compensation package, the Committee analyzed tally sheets with respect to ONEOK’s named executive officers. These tally sheets were prepared by ONEOK’s human resources department working with the Committee’s executive compensation consultant. Each of these tally sheets presented the dollar amount of each component of the named executive officers’ compensation, including current cash compensation (base salary and any annual short-term cash incentive payment), accumulated deferred compensation balances, outstanding long-term equity awards, retirement benefits, incidental perquisites and any other compensation. These tally sheets also reflected potential payments under selected termination of employment and change-in-control scenarios.

The purpose of these tally sheets is to summarize all of the elements of actual and potential future compensation of ONEOK’s named executive officers so that the Committee may analyze both the individual elements of compensation (including the compensation mix), as well as the aggregate total amount of actual and projected compensation.

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Compensation Mix. In determining the overall mix of compensation for 2013 for ONEOK’s named executive officers, the Committee considered the competitive market data presented by its executive compensation consultant in order to assess an appropriate allocation between cash and non-cash compensation. ONEOK pays base salary and short-term incentives in the form of cash, which is consistent with competitive market practices. The long-term incentive components of its executive compensation are structured to be paid in shares of ONEOK common stock, which is also consistent with competitive market practice. In 2013, grants to ONEOK’s named executive officers consisted of approximately 80 percent of the value in performance units and 20 percent of the value in restricted stock incentive units, consistent with ONEOK’s pay-for-performance philosophy. In addition, the payment of long-term incentive compensation in the form of ONEOK common stock helps to align the interests of its executive officers with the interests of its shareholders and assists its executives in establishing a meaningful ownership position in ONEOK and in meeting its share-ownership guidelines.

Personal Performance. Executive compensation decisions include an assessment of individual performance, including the officer’s contribution to ONEOK’s overall performance for the applicable performance period. Individual performance criteria include:

• business results achieved;

• problem analysis;

• directing business activities;

• utilization of human, capital and material resources;

• initiation of and response to, change;

• leadership, planning and organizational abilities;

• decision-making;

• time management;

• communication and employee relations;

• safety;

• regulatory compliance; and

• customer satisfaction.

The Committee completes an individual performance assessment of ONEOK’s chief executive officer each year. This performance assessment is summarized and presented to ONEOK’s chief executive officer for discussion and is reviewed by the Committee in executive session when evaluating the compensation of ONEOK’s chief executive officer. The other named executive officers are also evaluated each year through ONEOK’s performance appraisal process by ONEOK’s chief executive officer. These performance assessments are considered each year in connection with the overall compensation review process for ONEOK’s executives.

There are no differences in the Committee’s compensation policies and practices for determining the compensation awarded to the chief executive officer and the other named executive officers. All executive officers are subject to the same compensation policies. Differences in levels of compensation are attributable to differences in roles and responsibilities, and the Committee’s practice of setting pay levels to reflect competitive market conditions on a position by position basis.

Compensation Methodology—Going Forward

We expect that our executive compensation methodology initially will be similar to that of ONEOK immediately prior to the separation and our Executive Compensation Committee will retain an independent compensation consultant, develop our own peer group and other tools it will use when determining our executive compensation. Following the separation, we will consider, develop and refine our compensation methodology.

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Components of Compensation—Historical

Total Compensation. The Committee strives to provide a comprehensive executive compensation program that is competitive and performance based. To that end, executive compensation is tied directly to ONEOK’s operating and financial performance. The Committee structures executive compensation to ensure it considers long- and short-term financial performance, shareholder return, business unit performance, safety, environmental and regulatory compliance and the individual performance criteria.

Annual Cash Compensation. As in prior years, annual cash compensation for the named executive officers consists of two components: base salary and a variable, at-risk annual short-term cash incentive award that is earned based on both the company’s financial performance and the executive officer’s individual performance.

Base Salary. Annual base salary is designed to compensate executives for their level of responsibility, experience, tenure, sustained individual performance and contribution to the company. Salaries are reviewed annually. While the Committee considers ONEOK’s overall financial performance in establishing levels of executive compensation each year, there are no specific, objective financial results that are quantified by the Committee in establishing or changing the base salaries of ONEOK’s executive officers.

Annual Short-Term Cash Incentive Awards. Variable, at-risk annual short-term cash incentive awards are made under ONEOK’s annual incentive plan and are designed to communicate a collective annual corporate goal, to provide ONEOK’s officers with a direct financial interest in company performance and profitability and to reward performance. The 2013 short-term cash incentive plan performance goals and ONEOK’s performance relative to such goals are described under “—2013 Annual Short-Term Incentive Awards.”

Long-Term Equity Incentive Awards. Annual grants of long-term equity incentive awards are made under ONEOK’s LTI Plan and ONEOK’s ECP, and consist of restricted stock incentive units and performance units. A restricted stock incentive unit award is designed to provide a meaningful incentive to enhance long-term shareholder value. A performance-unit award is designed to enable the company to attract, retain and reward certain employees and to give these employees an incentive to enhance long-term shareholder value. A higher ratio of performance units to restricted stock incentive units is granted to higher-level officers and those with more direct ability to impact the company’s performance.

Retirement Benefits. ONEOK has a defined contribution 401(k) retirement plan covering all of its employees, and ONEOK matches employees’ contributions under this plan up to 6 percent of eligible compensation each pay period subject to limits under the Code. ONEOK also maintains a defined benefit pension plan covering certain named executive officers and employees hired prior to January 1, 2005, and a Profit-Sharing Plan covering its named executive officers and employees hired after December 31, 2004. Under the Profit-Sharing Plan, ONEOK made a contribution to the plan each calendar quarter during 2013 that resulted in an allocation to the participant’s plan account of an amount equal to 1 percent of the participant’s eligible compensation for that quarter. ONEOK also made an additional discretionary contribution to the participant’s account at year end equal to 4 percent of the participant’s eligible 2013 compensation. The plan does not provide for any employee contributions.

In addition, ONEOK has a supplemental executive retirement plan for the benefit of certain officers. No new participants in its supplemental executive retirement plan have been approved since 2005, and during 2013, this plan was closed to new participants. Additional details regarding ONEOK’s pension plan and supplemental executive retirement plan are provided under “—Retirement Benefits.” ONEOK also sponsors employee health and welfare plans that provide postretirement medical and life insurance benefits to employees who retire from its company. These postretirement plans are contributory, with retiree contributions adjusted periodically and contains other cost-sharing features such as deductibles and co-insurance.

Nonqualified Deferred Compensation Arrangements. Nonqualified deferred compensation arrangements are available to certain officers and employees who are subject to certain limits established by the Code, with respect

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to their qualified benefit plan contributions. Because these arrangements by their nature are tied to the qualified plan benefits, they are not considered when establishing salary and short-term and long-term incentive measures and amounts.

Perquisites and Other Benefits. ONEOK provides only minimal perquisites to the named executive officers, which are not taken into account when establishing salary and short- and long-term incentive compensation.

The foregoing compensation components place a significant portion of total executive compensation at risk based on both ONEOK’s annual and the long-term performance, which aligns the interests of its executive officers with the interests of its shareholders. Comparisons with compensation levels at its peer groups identified above are used by the Committee in assessing the overall competitiveness of its compensation program. ONEOK believes that its executive compensation program also must be internally consistent and equitable in order for ONEOK to achieve its corporate objectives. In setting the elements and amounts of compensation, the Committee does not consider amounts of compensation realizable from prior compensation, except when making grants of long-term, equity-based incentive grants each year. The Committee does consider, among other factors it deems relevant, the size of grants of long-term, equity-based compensation made in prior years.

Components of Compensation—Going Forward

We expect that our executive compensation components initially will be similar to that of ONEOK immediately prior to the separation. We have adopted compensation plans, including plans for our Named Executive Officers, that are substantially similar to the ONEOK compensation plans described above. These plans, other than plans providing for the issuance of our common stock, will be effective on January 1, 2014. Plans providing for the issuance of our common stock will be effective on the date of the separation. Following the separation, we will consider, develop and refine the components of our compensation.

Determination of Compensation—Historical

For each of ONEOK’s named executive officers, 2013 base salary and short- and long-term incentives were determined following consideration of referenced market data for ONEOK’s peer groups, identified above, compiled and furnished by the executive compensation consultant to the Committee, internal equity considerations and a subjective determination of the achievement of the individual performance criteria described on page 106. The Committee does not use objective targets when evaluating performance with respect to those individual criteria, and does not have a specific weighting for any of the factors. The final determination is based upon all of the individual performance criteria, considered in the aggregate and in light of the surrounding circumstances, but such determination and the assessment of each individual factor is entirely subjective. The Committee includes and reviews those subjective factors to insure that it undertakes a comprehensive review of individual performance when setting compensation.

When targeted levels of individual performance and company financial performance are achieved, the Committee seeks to pay ONEOK’s named executive officers a base salary and short- and long-term incentives at approximately the median level of pay for that position at ONEOK’s peer groups and other organizations with which ONEOK competes for executive talent as referenced in the market data. In determining 2013 compensation levels, the Committee determined that the company’s financial performance met targeted levels and that each named executive officer achieved appropriate levels of performance on the subjective individual performance criteria. As a result, the Committee targeted the total direct compensation for each of the named executive officers at between the 25th and 50th percentiles in order to attract and retain executives, with adjustments made reflecting, among other things, the executive’s tenure with ONEOK, level of responsibility and time in the executive’s current position. Generally, the Committee prefers a total compensation mix that favors a larger portion of compensation at risk, resulting in a large portion of compensation being granted in the form of long-term incentive awards to promote strong alignment with shareholder goals.

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2013 Annual Short-Term Incentive Awards. Short-term cash incentive awards for 2013 were based on five company-wide performance measures:

• EPS weighted at 50 percent. EPS is an important indicator of profitability by measuring ONEOK’s earnings allocable to each outstanding share of its common stock. This measure aligns the interests of ONEOK’s named executive officers with its shareholders and focuses ONEOK’s executives on achieving near-term profit goals. EPS is calculated by dividing ONEOK’s net income by the number of its average outstanding shares of common stock for ONEOK’s fiscal year.

• ROIC weighted at 40 percent (with 20 percent relating to ONEOK’s stand-alone ROIC and 20 percent relating to the ROIC for ONEOK Partners, in each case exclusive of the cumulative effect of accounting changes). ROIC is a critical indicator of how effectively ONEOK used its capital invested in its operations and is an important measurement for judging how much value ONEOK is creating for its shareholders. ROIC is the ratio of earnings before interest and taxes to the amount of capital (debt and equity) invested by ONEOK to generate earnings. The computed ROIC percentage can be compared with the cost of capital, which is what investors would expect to receive if they were to invest their capital elsewhere.

• Two safety criteria: (1) the recordable incident rate, weighted at 5 percent and (2) the preventable vehicle incident rate, also weighted at 5 percent. The total recordable incident rate is the number of Occupational Safety and Health Administration incidents per 200,000 work-hours, and the preventable vehicle incident rate is the preventable vehicle incidents per one million miles driven. The inclusion of these two important safety factors is designed to emphasize ONEOK’s commitment to the safe operation of ONEOK’s business and to reward safe behavior throughout the company.

Based upon ONEOK’s performance against these measures, targeted annual short-term cash incentive awards for 2013 company performance could range from zero to a maximum of 200 percent of target. In determining the actual annual short-term incentive award to be paid to each executive, assuming the company’s performance measures are met, the award is adjusted based on individual performance, specifically, the individual’s contributions to achieving corporate goals and the behaviors exhibited by the individual that are described above. As in past years, tying the annual short-term cash incentive award to individual performance raises the level of personal accountability for each executive officer.

The 2013 annual short-term cash incentive plan measures and weighting were developed and recommended to the Committee by executive management, were reviewed and approved by the Committee, and were ratified by ONEOK’s board of directors in February 2013. The 2013 benchmarks and targets are summarized as follows:

	Amounts									Weight			Maximum Corporate Percentage of Target Payable
ONEOK, Inc. 2013 Short-Term Incentive Criteria	Threshold (0% of Target)			Target (100% of Target)			Maximum (300% of Target)
Stand-alone ROIC		13.1	%		14.9	%		16.6	%		20	%		60.0	%
ONEOK Partners, L.P. ROIC		9.6	%		10.5	%		11.2	%		20	%		60.0	%
Total recordable incident rate		2.51			2.18			1.85			5	%		15.0	%
Preventive vehicle incident rate		1.59			1.38			1.17			5	%		15.0	%
				Amounts						Weight			Maximum Corporate Percentage of Target Payable
ONEOK, Inc. 2013 Short-Term Incentive Criteria				Threshold (50% of Target)			Target (100% of Target)
Earnings per share				$	1.51		$	1.79			50	%		50.0	%
														200.0	%

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For each performance measure in the table above, no incentive amount would be paid for that measure if the company’s actual result was below the threshold level. If ONEOK’s actual result was between the stated performance levels, the percentage payable was interpolated between the stated payout percentages. Maximum corporate payout percentages were set for each performance level. The cumulative maximum corporate payout percentage was 200 percent of target for 2013.

The awards under the 2013 annual incentive plan were eligible for further adjustment based upon the recommendation of ONEOK’s chief executive officer as a result of his assessment of business-unit performance and its contribution to ONEOK’s overall performance. The assessment of business-unit performance and contribution at the corporate level included the review by the Committee of the business unit’s 2013 operating income compared with ONEOK’s 2013 financial plan, the business unit’s safety and environmental compliance, and other factors, taking into consideration ONEOK’s chief executive officer’s recommendation. The chief executive officer did not recommend, and the Committee did not make, any further adjustment to the 2013 annual short-term incentive awards for the named executive officers.

In addition to taking into account the established corporate criteria and the allocation to business units based upon their respective performance, annual short-term cash incentive awards to the named executive officers and all other participants are subject to further adjustment through the application of an individual performance multiplier ranging from zero to 125 percent. The individual performance multiplier for each named executive officer is set by the Committee annually, taking into consideration management’s recommendation regarding individual performance and contribution. A named executive officers’ maximum incentive award for 2012 could have been as high as 250 percent of their target award, taking into account the maximum corporate payout percentage of 200 percent and the maximum individual performance multiplier of 125 percent.

In 2013, each named executive officer’s targeted annual short-term incentive award, as a percentage of salary, was set to approximate the 50th percentile of the range of the competitive market data provided by the Committee’s executive compensation consultant in order to attract and retain executives, with the opportunity to earn above-average amounts if the performance criteria targets were exceeded and also based on adjustment due to individual performance.

At the meeting of the Committee held in              2014, the Committee determined that payouts under the 2013 short-term incentive plan would be based on a              percent multiplier. This determination was made following the calculation of the year-end results of ONEOK’s achievement with respect to the five objective performance criteria referenced above. The percentage multiplier was calculated based on a sum of the following determinations:

• the 2013 stand-alone ROIC performance measure was              percent, which was             . As a result, the weighted interpolated percentage of              percent was earned toward the overall corporate multiplier;

• the 2013 ONEOK Partners ROIC was              percent, which             . As a result, the weighted percentage of              percent was earned toward the overall corporate multiplier;

• the 2013 total recordable incident rate performance measure was             , which was              than the              2013 recordable incident rate performance             . As a result the weighted interpolated percentage of              percent was earned toward the overall corporate multiplier;

• the 2013 preventable vehicle incident rate performance measure was             , which was lower              than the 2012 preventable vehicle incident rate performance             . As a result, the weighted interpolated percentage of              percent was earned toward the overall corporate multiplier; and

• 2013 EPS were $             per share, which             . As a result,              percent was earned toward the overall corporate multiplier.

These performance measure percentages were added together to arrive at the              percent multiplier.

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To determine the short-term awards payable to each of ONEOK’s named executive officers with respect to 2013, the              percent multiplier was multiplied by the named executive officer’s base salary, times his short-term incentive percentage as determined by the Committee, and times his individual performance multiplier as described above. The annual calculation for ONEOK’s named executive officers may be stated as follows: short-term incentive award = corporate performance multiplier x base salary x established short-term incentive percentage x established individual performance multiplier.

Long-Term Incentive Awards

Overview. ONEOK maintains the LTI Plan and the ECP, pursuant to which various types of long-term equity incentives may be granted, including restricted and performance units. ONEOK has not granted stock options since 2007, and no options are held by its named executive officers. Participation in the LTI Plan and the ECP is limited to those officers and employees who are in a position to contribute significantly to ONEOK’s long-term growth and profitability. These plans are administered by the Committee, and the Committee is authorized to make all grants of long-term incentive awards under the plans, as well as to make all decisions and interpretations required to administer the plans.

Equity-based long-term incentive awards are approved and granted on an annual cycle, typically in the first quarter of each year. Awards made by the Committee in 2013 were based upon competitive market data presented to the Committee by the Committee’s executive compensation consultant, as well as the Committee’s assessment of ONEOK’s overall performance and the individual executive’s performance and contribution. In addition, in considering the 2013 long-term incentive award grants to be made to ONEOK’s named executive officers, the Committee considered the continued volatility in the stock market in the first quarter 2013 and the impact of that volatility on the value of ONEOK’s common stock. The Committee also considered the size of equity grants made in prior years to each executive.

Participants may defer the receipt of shares otherwise issuable upon vesting of equity grants made to them under the LTI plan and the ECP. With respect to any such deferrals, the issuance of shares is deferred until the date indicated in the participant’s election. Dividend equivalents are earned on the deferred awards during the deferral period and are deemed to be reinvested in ONEOK common stock. At the distribution date, shares are distributed to participants based on the number of shares deferred and the fair market value of ONEOK common stock price on that date.

2013 Awards. In 2013, restricted stock incentive units were granted pursuant to the LTI Plan, and performance units were granted pursuant to the ECP. With respect to awards to our Named Executive Officers in 2013, approximately 80 percent were performance-unit awards and 20 percent were restricted-unit awards, reflecting ONEOK’s practice to deliver more value in awards based on a performance metric than in awards based on a service metric.

Restricted Units. Restricted stock incentive units granted under the LTI Plan in 2013 vest three years from the grant date, at which time the holder is entitled to one share of ONEOK common stock for each restricted stock incentive unit held. If a holder of restricted stock incentive units retires, becomes disabled, dies or is terminated involuntarily other than for cause prior to vesting, the restricted stock incentive units will vest on a pro-rated basis based on the number of full months elapsed from the date of grant and the date of such holder’s retirement, disability, death or involuntary termination other than for cause. In cases of termination of employment for any reason other than retirement, disability, death or involuntary termination other than for cause, restricted stock incentive units are forfeited. In the event of a change in control of the company, restricted stock incentive unit awards vest in full. No dividend equivalents are payable with respect to these restricted stock incentive units; however, restricted stock incentive units granted under the LTI Plan in 2013 do provide for the payment of dividend equivalents.

Performance Units. Performance units granted under the ECP in 2013 vest three years from the grant date, at which time the holder is entitled to receive a percentage of the performance units granted in shares of ONEOK

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common stock. The number of shares of common stock to be issued upon vesting will range from 0 to 200 percent of the number of units granted based on ONEOK’s TSR over the three-year performance period, compared with the TSR of the peer group used by ONEOK to determine our Chief Executive Officer’s compensation. TSR includes both the change in market price of the stock and the value of dividends paid and reinvested in the stock during the performance period. Peer companies that are no longer publicly traded on the closing date of the performance period will not be considered in the performance calculation. The following table reflects the percentage of units that could be earned at the end of the performance period based on ONEOK’s TSR performance during such period as compared with its peer group:

Performance Units Vesting Criteria

February 2013-February 2016 Performance Period

ONEOK TSR Ranking vs. ONEOK Peer Group	Percentage of Performance Units Earned
90th percentile and above		200	%
75th percentile		150	%
50th percentile		100	%
25th percentile		50	%
Below the 25th percentile		0	%

If ONEOK’s TSR ranking at the end of the performance period is between the stated percentage levels set forth in the table above, the percentages of performance units earned will be interpolated between the earnings levels.

If a holder of performance units retires, becomes disabled or dies prior to vesting, the performance units will vest based on the performance results at the end of the performance period and will be pro-rated based on the number of full months elapsed between the grant date and the date of such holder’s retirement, disability or death. In cases of termination of employment for any reason other than retirement, disability or death, performance units are forfeited. In the event of a change of control in the company, ONEOK’s performance-unit awards will vest. No dividend equivalents are payable with respect to these performance units; however, performance units granted under the ECP in 2013 do provide for the payment of dividend equivalents.

Determination of Compensation—Going Forward

We expect that our Executive Compensation Committee will develop a process for establishing long- and short-term incentives based on financial and non-financial performance goals, including individual performance criteria and internal equity considerations, that initially will be similar to that of ONEOK immediately prior to the separation.

Clawback Provisions—Historical

ONEOK’s board of directors believes that employees who are responsible for material noncompliance with applicable financial reporting requirements resulting in accounting errors leading to financial statement restatements should not benefit monetarily from such noncompliance. ONEOK has adopted clawback provisions to permit its board of directors or a committee of its board of directors to use appropriate discretion to recapture grants of performance units and short-term cash incentive awards paid to employees who bear responsibility for such noncompliance. ONEOK believes that these clawbacks discourage employees from taking actions that could result in material excessive risk to it.

ONEOK’s outstanding performance-unit grants contain provisions that allow the Committee, in its sole discretion, to seek recoupment of the grant of the performance units, any resulting shares earned and gross

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proceeds from the sale of such shares in the event of fraud, negligence or intentional misconduct by the holder of the performance units that is determined to be a contributing factor to it having to restate all or a portion of its financial statements.

In addition, ONEOK’s annual short-term incentive plan provides that the Committee, in its sole discretion, may require for repayment of all or a portion of a short-term cash incentive award to a participant in the event of fraud, negligence or intentional misconduct by the participant that is determined to be a contributing factor to ONEOK having to restate all or a portion of its financial statements.

Clawback Provisions—Going Forward

We have adopted a clawback policy that is substantially similar to ONEOK’s policy.

Securities Trading Policy—Historical

ONEOK has a policy that employees, including its officers and directors, may not purchase or sell its stock when they are in possession of material non-public information. This policy also provides that officers, directors and employees in certain designated work groups may trade in its securities only during “open window” periods (beginning the third day after its release of quarterly or annual earnings and continuing until the first day of the following calendar quarter) and must pre-clear all purchases and sales of its securities with its executive management. In addition, this policy provides that no director or officer may sell short or engage in transactions in put or call options relating to securities of the company.

Securities Trading Policy—Going Forward

We have adopted a securities trading policy that is substantially similar to ONEOK’s policy.

Share Ownership Guidelines—Historical

ONEOK’s board of directors strongly advocates executive share ownership as a means to align executive interests with those of its shareholders and has adopted share-ownership guidelines for its chief executive officer and all other officers of ONEOK. These guidelines are mandatory and must be achieved by each officer over the course of five years. The ownership guideline for ONEOK’s chief executive officer is a share ownership position with a value of six times base salary. The ownership guidelines for the other officers provide for share ownership positions ranging from two to five times base salary, depending on the office held.

ONEOK’s board of directors also has established minimum share-ownership guidelines for its directors that provide that, within five years after joining ONEOK’s board of directors, each non-management director will own shares of its common stock having a minimum value of five times the annual cash retainer paid for service on ONEOK’s board of directors.

Share Ownership Guidelines—Going Forward

We have adopted share ownership guidelines that are substantially similar ONEOK’s guidelines.

IRS Limitations on Deductibility of Executive Compensation—Historical

Section 162(m) of the Code, places a limit of $1,000,000 on the amount of compensation that ONEOK may deduct in any one year with respect to its chief executive officer and the three other most highly compensated executive officers, other than the principal financial officer, who are employed by it on the last day of the taxable year. There is an exception to the $1,000,000 limitation for performance-based compensation that meets certain requirements. To maintain flexibility in compensating executive officers in a manner designed to promote

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varying corporate goals in the best interest of the company, the Committee has not adopted a policy requiring all compensation to be fully deductible under Section 162(m).

IRS Limitations on Deductibility of Executive Compensation—Going Forward

We expect that our Executive Compensation Committee will consider approaches to Section 162(m) in order to meet our business needs and goals effectively.

Post-Employment Compensation—Historical

Qualified Retirement Plans. ONEOK maintains a defined benefit pension plan qualified under both the Code and the Employee Retirement Income Security Act of 1974, as amended, for non-bargaining unit employees hired prior to January 1, 2005, and certain bargaining-unit employees. Non-bargaining unit employees hired after December 31, 2004, employees represented by Local No. 304 of the International Brotherhood of Electrical Workers hired on or after July 1, 2010, employees represented by United Steelworkers hired on or after December 15, 2011, and employees who accepted a one-time opportunity to opt out of ONEOK’s pension plan are covered by ONEOK’s defined contribution Profit-Sharing Plan.

Supplemental Executive Retirement Plan. ONEOK maintains a SERP as a supplemental retirement benefit plan for certain officers. The SERP provides that officers may be selected for participation in a supplemental retirement benefit or an excess retirement benefit, or both. If a participant is eligible for both the supplemental retirement benefit and the excess retirement benefit, the excess retirement benefit and benefits payable under ONEOK’s qualified pension plan are treated as an offset that reduces the supplemental retirement benefit. Participants in the SERP are selected by ONEOK’s chief executive officer or, in the case of ONEOK’s chief executive officer, by its board of directors.

No new participants have been added to ONEOK’s SERP since 2005, and during 2013, the plan was closed to new participants.

Nonqualified Deferred Compensation Plan. ONEOK maintains a Nonqualified Deferred Compensation Plan (“Deferred Compensation Plan”) to provide select employees with the option to defer portions of their compensation and provide nonqualified deferred compensation benefits that are not otherwise available due to limitations on employer and employee contributions to qualified defined contribution plans under the federal tax laws.

Potential Post-Employment Payments and Payments Upon a Change in Control. Described below are the post-employment compensation and benefits that ONEOK provides to its named executive officers. The objectives of the post-employment compensation and benefits that ONEOK provides are to:

• assist in recruiting and retaining talented executives in a competitive market;

• provide security for any compensation or benefits that have been earned;

• permit executives to focus on ONEOK’s business;

• eliminate any potential personal bias of an executive against a transaction that is in the best interest of ONEOK’s shareholders;

• avoid the costs associated with separately negotiating executive severance benefits; and

• provide ONEOK with the flexibility needed to react to a continually changing business environment.

ONEOK does not enter into individual employment agreements with its executive officers. Instead, the rights of ONEOK’s executives with respect to specific events are covered by its compensation and benefit plans. Under this approach, post-employment compensation and benefits are established separately from the other compensation elements of ONEOK’s executives.

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The use of a “plan approach” instead of individual employment agreements serves several objectives. First, the plan approach provides ONEOK with more flexibility to change the terms of severance benefits from time to time if necessary. Second, the plan approach is more transparent, both internally and externally. Internal transparency eliminates the need to negotiate separation benefits on a case-by-case basis and assures an executive that his or her severance benefits are comparable with those of his or her peers. Finally, the plan approach is easier for ONEOK to administer, as it requires less time and expense.

Payments Made Upon Any Termination. Regardless of the manner in which a named executive officer’s employment terminates, he or she is entitled to receive amounts earned during their term of employment. These amounts include:

• accrued but unpaid salary;

• amounts contributed under ONEOK’s Thrift Plan, Profit-Sharing Plan and Deferred Compensation Plan; and

• amounts accrued and vested through ONEOK’s pension plan and SERP.

Payments Made Upon Retirement. In the event of the retirement of a named executive officer, in addition to the items identified above, such named executive officer will be entitled to:

• receive a prorated share of each outstanding performance unit granted under ONEOK’s ECP upon completion of the performance period;

• receive a prorated portion of each outstanding restricted stock incentive unit granted under ONEOK’s LTI Plan and ECP upon completion of the restricted period; and

• participate in health and life benefits for the retiree and qualifying dependents, if eligible.

Payments Made Upon Death or Disability. In the event of the death or disability of a named executive officer, in addition to the benefits listed under the headings “Payments Made Upon Any Termination” and “Payments Made Upon Retirement” above, the named executive officer may receive applicable benefits under ONEOK’s disability plan or payments under ONEOK’s life insurance plan.

Payments Made Upon or Following a Change in Control. ONEOK’s senior management and other employees have built ONEOK into the successful enterprise that it is today, and ONEOK believes that it is important to protect their interests in the event of a change in control of ONEOK. Further, it is ONEOK’s belief that the interests of its shareholders will be best served if the interests of ONEOK’s senior management are aligned with its shareholders, and that providing change-in-control benefits should mitigate the reluctance of senior management to pursue potential change-in-control transactions that may be in the best interests of ONEOK’s shareholders.

ONEOK’s board of directors, upon the recommendation of the Committee, has approved a Change-in-Control Plan that provides for certain payments in the event of termination of employment of an executive officer of ONEOK (including the named executive officers) following a change in control. The plan does not provide for additional pension benefits upon a change in control. In addition, the plan does not provide for a tax gross-up feature but provides plan participants a “net best” approach to excise taxes in determining the benefit payable to a participant under the plan. This approach determines a participant’s net best benefit based on the full benefit being paid to a participant and the participant paying the applicable federal excise tax, if any, or reducing the benefit to a level which would not trigger the payment of federal excise tax. To determine the levels of benefits to be paid to the named executive officers under the plan, the Committee consulted with Meridian Compensation Partners, its independent executive compensation consultant, to determine competitive practices in ONEOK’s industry with respect to change-in-control arrangements. The Committee determined that the levels of benefits provided under the plan, including the payment of various multiples of salary and target short-term incentive compensation, accomplished its objective of providing competitive benefits and that these benefits are consistent

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with the general practice among ONEOK’s peers. Under this plan, all change-in-control benefits are “double trigger” and are payable only if the officer’s employment is terminated without “just cause” or by the officer for “good reason” at any time during the two years following a change in control.

Relative to the overall value of the company, ONEOK believes the potential benefits payable upon a change in control under the Change-in-Control Plan are comparatively minor, and ONEOK believes that the level of benefits is consistent with the general practice among its peers.

Post-Employment Compensation—Going Forward

We expect that our post-employment executive compensation components initially will be similar to those of ONEOK immediately prior to the separation. Following the separation, we will consider, develop and refine our post-employment compensation components.

Effects of Separation on Outstanding Executive Compensation Awards

The following discussion describes the expected treatment of outstanding ONEOK equity awards in connection with the separation and is subject to approval of the Committee and our Board of Directors or Executive Compensation Committee. The different types of awards listed below are described in further detail above, beginning on page 111. The post-separation treatment of an award is expected to depend on the type of award, the performance or service period for which the award was granted and whether the holder will be an employee of ONEOK or ONE Gas immediately following the separation. For purposes of this discussion, “ONE Gas Employee” refers to an individual who is employed by ONE Gas immediately following the separation and “ONEOK Employee” refers to an individual who is employed by ONEOK immediately following the separation. We expect that the treatment described below would become effective as of the separation.

Restricted Stock Units

We expect the treatment of ONEOK restricted stock units (“ONEOK RSUs”) that are outstanding at the time of the separation to depend on the original grant date and, for awards granted after 2011, whether the individual is a ONEOK Employee or a ONE Gas Employee. We expect ONEOK RSUs originally granted in 2011 to vest in full on or before the record date for the distribution of our common stock to ONEOK shareholders in connection with the separation, if the separation occurs on or before February 17, 2014. If the separation occurs after that date, we expect ONEOK RSUs originally granted in 2011 to vest in accordance with their original terms. We expect ONEOK RSUs granted after 2011 and held by ONE Gas Employees at the time of the separation to be concurrently cancelled and reissued as ONE Gas restricted stock units (“ONE Gas RSUs”), adjusted in a manner that will equalize the value of the award before and after the date of separation and vests based upon the holder’s continuing employment with ONE Gas. Otherwise, such ONE Gas RSUs will have substantially the same terms and conditions as the original ONEOK RSUs. We also expect that ONEOK RSUs granted after 2011 and held by ONEOK Employees at the time of the separation will be adjusted to equalize the value of the award before and after the date of separation but otherwise will remain unchanged.

Performance Units

We expect the treatment of ONEOK performance units that are outstanding at the time of the separation to depend on the original grant date and, for awards granted after 2011, whether the individual is a ONEOK Employee or a ONE Gas Employee. We expect ONEOK performance units originally granted in 2011 to vest in full on or before the record date for the separation, if the separation occurs on or before February 17, 2014. If the separation occurs after that date, we expect ONEOK performance units originally granted in 2011 to vest in accordance with their original terms.

We expect ONEOK performance units granted after 2011 and held by ONE Gas Employees at the time of the separation to be concurrently cancelled and replaced by a new ONE Gas award, one portion of which will

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have a value based upon achievement of the performance objectives applicable to the original grant through date of the separation, and the other portion of which will reflect the relative performance of our common stock against our peer group during the period between the date of the separation and the original end of the performance period. The portion of the new award relating to the period prior to the separation will vest at the end of the original performance period on the basis of continued employment with ONE Gas following the separation. The portion of the new award relating to the period after the separation will vest at the end of the original performance period on the basis of actual ONE Gas performance relative to performance criteria established in accordance with the ONE Gas Equity Compensation Plan.

We expect the number of, and the performance metrics related to, the ONEOK performance units granted after 2011 and held by ONEOK Employees at the time of the separation to be adjusted to equalize the value of the award before and after the date of separation. The awards will vest at the end of the original performance period in accordance with their terms.

Deferred Shares

Deferred share accounts maintained pursuant to the ONEOK stock plans will be treated in a manner similar to ONEOK common stock and will be credited with a number of deferred shares of ONE Gas common stock determined in accordance with the distribution ratio established in connection with the separation. ONEOK will maintain those accounts, for both ONEOK Employees and ONE Gas Employees, to the extent they represent ONEOK deferred shares, and ONE Gas will maintain those accounts, for both ONEOK Employees and ONE Gas Employees, to the extent they represent ONE Gas deferred shares. The accounts will otherwise remain subject to the individuals’ prior deferral elections and the terms of such plans.

Named Executive Officer Compensation

The five persons shown on the tables below are those whom we expect will be our named executive officers on the distribution date. These individuals are our Chief Executive Officer and President, Chief Financial Officer and our three most highly compensated executive officers (other than our Chief Executive Officer and Chief Financial Officer). We expect that, prior to the separation, each of our named executive officers will have been employed by ONEOK or its subsidiaries; therefore, the information provided for the years 2013, 2012 and 2011 reflects compensation earned at ONEOK or its subsidiaries.

The amounts and forms of compensation reported below are not necessarily indicative of the compensation that ONE Gas executive officers will receive following the separation, which could be higher or lower, because historical compensation was determined by ONEOK and because future compensation levels at ONE Gas will be determined based on the compensation policies, programs and procedures to be established by ONE Gas’ Executive Compensation Committee for those individuals who will be employed by ONE Gas following the separation.

All references in the following tables to stock, restricted stock units and performance stock units relate to awards granted by ONEOK in respect of ONEOK common shares, and do not refer to shares of One Gas.

Information that will not be available until after December 31, 2013, will be included in a subsequent amendment.

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Summary Compensation Table for Fiscal 2013

Name and Principal Position	Year		Salary		Stock Awards(1)		Non-Equity Incentive Plan Compensation(2)		Change in Pension Value and Nonqualified Deferred Compensation Earnings(3)			All Other Compensation(4)		Total
Pierce H. Norton II		2013	$	500,000	$	766,341			$	54,111		$	53,048
President and Chief Executive Officer		2012	$	500,000	$	1,443,085	$	375,000	$	336,193		$	58,911	$	2,713,189
		2011	$	400,000	$	1,086,800	$	475,000	$	183,688		$	43,397	$	2,188,885
Curtis L. Dinan		2013	$	435,000	$	510,022			($	104,865	)	$	44,648
Senior Vice President, Chief Financial Officer and Treasurer		2012 2011	$ $	435,000 425,000	$ $	907,082 1,086,800	$ $	300,000 440,000	$ $	424,560 224,494		$ $	52,911 46,397	$ $	2,119,553 2,222,691
Caron A. Lawhorn		2013	$	360,000	$	510,022			($	38,610	)	$	37,748
Senior Vice President, Commercial		2012 2011	$ $	360,000 330,000	$ $	907,082 752,400	$ $	250,000 330,000	$ $	362,016 213,063		$ $	41,811 34,397	$ $	1,920,909 1,659,860
Gregory A. Phillips		2013	$	270,000	$	255,011			($	58,984	)	$	81,800
Senior Vice President, Operations		2012 2011	$ $	250,000 235,000	$ $	329,848 334,400	$ $	120,000 168,000	$ $	377,438 222,699		$ $	25,491 68,337	$ $	1,102,777 1,028,436
Joseph L. McCormick		2013	$	255,000	$	256,370			$	18,215		$	27,448
Senior Vice President, General Counsel and Assistant Secretary		2012 2011	$ $	235,000 215,000	$ $	131,012 159,030	$ $	112,000 160,000	$ $	117,673 78,652		$ $	31,361 24,507	$ $	627,046 637,189

(1) The amounts included in the table relate to restricted stock incentive units and performance-units granted under ONEOK’s Long Term Incentive Plan and ONEOK’s Equity Compensation Plan, respectively, and reflect the aggregate grant date fair value calculated pursuant to ASC Topic 718. The fair value of these performance units was estimated on the grant date based on a Monte Carlo model. No dividends were paid prior to vesting on performance stock units granted prior to 2013. Beginning in 2013, performance stock unit awards granted will accrue dividend equivalents prior to vesting.

The aggregate grant date fair value of restricted stock incentive units for purposes of ASC Topic 718 was determined based on the closing price of ONEOK common stock on the grant date, adjusted for the current dividend yield. With respect to the performance units, the aggregate grant date fair value for purposes of ASC Topic 718 was determined using the probable outcome of the performance conditions as of the grant date based on a valuation model that considers the market condition (total shareholder return) and using assumptions developed from historical information of the company and each of the referenced peer companies. The value included for the performance units is based on 100 percent of the performance units vesting at the end of the three-year performance period. Using the maximum number of shares issuable upon vesting of the performance units (200 percent of the units granted), the aggregate grant date fair value of the performance units would be as follows:

Name	2013		2012		2011
Pierce H. Norton II	$	1,200,576	$	2,373,840	$	1,803,100
Curtis L. Dinan	$	800,384	$	1,492,128	$	1,803,100
Caron A. Lawhorn	$	800,384	$	1,492,128	$	1,248,300
Gregory A. Phillips	$	400,192	$	542,592	$	554,800
Joseph L. McCormick	$	374,144	$	203,472	$	249,660

(2) Reflects short-term cash incentives earned in 2011, 2012 and 2013 and paid in 2012, 2013 and 2014, respectively, under ONEOK’s annual short-term incentive plan. For a discussion of the performance criteria established by the Committee for awards under the 2013 annual short-term incentive plan, see “2013 Annual Short-Term Incentive Awards” above.

(3) The amounts reflected represent the aggregate change during 2013 in the actuarial present value of the named executive officers’ accumulated benefits under ONEOK’s qualified Retirement Plan and Supplemental Executive Retirement Plan. For a description of these plans, see “Retirement Benefits” at page 107. The change in the present value of the accrued pension benefit is impacted by variables such as additional years of service, age and the discount rate used to calculate the present value of the change. For 2013, the change in pension value reflects not only the increase due to additional service and pay for the year, but also a decrease in present value due to the higher discount rate (        % percent for fiscal 2013, up from 4.25 percent in 2012). The ONEOK, Inc. Retirement Plan was closed to new participants as of December 31, 2004. All our Named Executive Officers participate in the plan. The ONEOK Supplemental Executive Retirement Plan was closed to new participants in 2013, although no new participants had been added since 2005. Ms. Lawhorn and Messrs. Norton, Dinan and Phillips participate in the plan.

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(4) Reflects (i) the amounts paid as ONEOK’s dollar-for-dollar match of contributions made by the named executive officer under ONEOK’s Nonqualified Deferred Compensation Plan, Thrift Plan for Employees of ONEOK, Inc. and Subsidiaries and Profit Sharing Plan, (ii) the value of shares received under ONEOK’s Employee Stock Award Program as of the date of issuance, and (iii) amounts paid for length of service awards as follows:

Name	Year		Match Under Nonqualified Deferred Compensation Plan		Match Under 401(k) Plan		Service Award		Stock Award		Relocation and Moving Expense
Pierce H. Norton II		2013	$	37,200	$	15,300	$	—	$	548	$	—
		2012	$	43,500	$	15,000	$	—	$	411	$	—
		2011	$	27,300	$	14,700	$	—	$	949	$	—
Curtis L. Dinan		2013	$	28,800	$	15,300	$	—	$	548	$	—
		2012	$	37,500	$	15,000	$	—	$	411	$	—
		2011	$	30,300	$	14,700	$	—	$	949	$	—
Caron A. Lawhorn		2013	$	21,300	$	15,300	$	600	$	548	$	—
		2012	$	26,400	$	15,000	$	—	$	411	$	—
		2011	$	18,300	$	14,700	$	—	$	949	$	—
Gregory A. Phillips		2013	$	8,100	$	15,300	$	—	$	548	$	57,852
		2012	$	10,080	$	15,000	$	—	$	411	$	—
		2011	$	5,280	$	14,700	$	625	$	949	$	46,081
Joseph L. McCormick		2013	$	11,200	$	15,300	$	400	$	548	$	—
		2012	$	15,950	$	15,000	$	—	$	411	$	—
		2011	$	8,400	$	14,700	$	—	$	949	$	—

With respect to Ms. Lawhorn and Messrs. Norton, Dinan, Phillips and McCormick, these amounts also reflect tax gross-ups received in 2011 in the amounts of $448, $448, $448, $426, and $458, respectively, in each case in connection with their receipt of stock awards under ONEOK’s Employee Stock Award Program.

With respect to Mr. Phillips, this amount also reflects a tax gross-up received in 2011 in the amount of $276 in connection with his receipt of a cash service award.

The named executive officers did not receive perquisites or other personal benefits with an aggregate value of $10,000 or more during 2011, 2012 or 2013.

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2013 Grants of Plan-Based Awards

The following table reflects the grants of plan-based awards to the named executive officers during 2013.

Grants of Plan-Based Awards for Fiscal Year 2013

	Grant Date		Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1)						Estimated Future Payouts Under Equity Incentive Plan Awards(2)						All Other Stock Awards: Number of Shares of Stock or Units(3)		Grant Date Fair Value of Stock Awards(4)
Name			Threshold		Target		Maximum		Threshold		Target		Maximum
Pierce H. Norton II
Restricted Unit		2/20/2013														3,175	$	166,053
Performance Unit		2/20/2013								—		12,675		25,350			$	600,288
Short-Term Incentive		1/1/2013	$	—	$	350,000	$	875,000
Curtis L. Dinan
Restricted Unit		2/20/2013														2,100	$	109,830
Performance Unit		2/20/2013								—		8,450		16,900			$	400,192
Short-Term Incentive		1/1/2013	$	—	$	282,750	$	706,875
Caron A. Lawhorn
Restricted Unit		2/20/2013														2,100	$	109,830
Performance Unit		2/20/2013								—		8,450		16,900			$	400,192
Short-Term Incentive		1/1/2013	$	—	$	234,000	$	585,000
Gregory A. Phillips
Restricted Unit		2/20/2013														1,050	$	54,915
Performance Unit		2/20/2013								—		4,225		8,450			$	200,096
Short-Term Incentive		1/1/2013	$	—	$	121,500	$	303,750
Joseph L. McCormick
Restricted Unit		2/20/2013														1,325	$	69,298
Performance Unit		2/20/2013								—		3,950		7,900			$	187,072
Short-Term Incentive		1/1/2013	$	—	$	102,000	$	255,000

(1) Reflects estimated payments that could have been made under ONEOK’s 2013 annual short-term cash incentive plan. The plan provides that ONEOK’s officers may receive annual short-term incentive cash awards based on the performance and profitability of the company, the performance of particular business units of the company and individual performance during the relevant fiscal year. The corporate and business-unit criteria and individual performance criteria are established annually by the Committee. The Committee also establishes annual target awards for each officer expressed as a percentage of their base salaries. The actual amounts earned by the named executive officers in 2013 under the plan and paid in 2014 are set forth under the “Non-Equity Incentive Plan Compensation” column in the Summary Compensation Table for Fiscal 2013 above.

(2) Reflects the performance units that could be earned pursuant to awards granted under ONEOK’s Equity Compensation Plan that are earned three years from the date of grant, at which time the holder is entitled to receive a percentage (0 to 200 percent) of the performance-units granted based on ONEOK’s total shareholder return over the period of February 20, 2013, to February 20, 2016, compared with the total shareholder return of the referenced peer group. One share of ONEOK common stock is payable in respect of each performance unit that vests. Performance units are also subject to accelerated vesting upon a change in control.

(3) Reflects restricted stock incentive units granted under ONEOK’s Long-Term Incentive Plan that vest three years from the date of grant, at which time the grantee is entitled to receive the grant in shares of ONEOK common stock.

(4) With respect to the performance units, the aggregate grant date fair value for purposes of ASC Topic 718 was determined using the probable outcome of the performance conditions as of the grant date based on a valuation model that considers market conditions (such as total shareholder return) and using assumptions developed from historical information of the company and each of the peer companies referenced under “Long-Term Incentive Awards – 2013 Awards” above. This amount is consistent with the estimate of aggregate compensation cost to be recognized over the performance period determined as of the grant date under ASC Topic 718. The value presented is based on 100 percent of the performance units vesting at the target level of performance at end of the three-year performance period.

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Outstanding Equity Awards

The following table shows the outstanding equity awards held by the named executive officers as of December 31, 2013.

Outstanding Equity Awards at 2013 Fiscal Year-End

	Option Awards										Stock Awards
Name	Number of Securities Underlying Unexercised Options Exercisable		Number of Securities Underlying Unexercised Options Unexercisable		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options		Option Exercise Price		Option Expiration Date		Number of Shares or Units of Stock That Have Not Vested(1)(3)		Market Value of Shares or Units of Stock That Have Not Vested	Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested(2)(3)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
Pierce H. Norton II		—		—		—	$	—		—		16,743			103,107
Curtis L. Dinan		—		—		—	$	—		—		13,045			84,769
Caron A. Lawhorn		—		—		—	$	—		—		11,045			68,769
Gregory A. Phillips		—		—		—	$	—		—		4,673			29,457
Joseph L. McCormick		—		—		—	$	—		—		3,353			15,409

(1) Represents restricted stock incentive units that have not yet vested. Restricted stock incentive units vest three years from the date of grant, at which time the grantee is entitled to receive the grant in shares of ONEOK common stock. Restricted stock incentive units are scheduled to vest as follows:

Restricted Unit Vesting Schedule

Pierce H. Norton II	6,500	on February 17, 2014
	7,000	on February 15, 2015
	3,243	on February 20, 2016
Curtis L. Dinan	6,500	on February 17, 2014
	4,400	on February 15, 2015
	2,145	on February 20, 2016
Caron A. Lawhorn	4,500	on February 17, 2014
	4,400	on February 15, 2015
	2,145	on February 20, 2016
Gregory A. Phillips	2,000	on February 17, 2014
	1,600	on February 15, 2015
	1,073	on February 20, 2016
Joseph L. McCormick	1,200	on February 17, 2014
	800	on February 15, 2015
	1,353	on February 20, 2016

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(2) Represents performance units that have not yet vested. Performance units vest three years from the date of grant, at which time the holder is entitled to receive a percentage (0 to 200 percent) of the performance-units granted based on ONEOK’s total shareholder return over the three-year performance period, compared with the total shareholder return of the referenced peer group. One share of ONEOK common stock is payable in respect of each performance-unit granted that becomes vested. Based on ONEOK’s performance at December 31, 2013, performance units are expected to vest as follows:

Performance Unit Vesting Schedule

Pierce H. Norton II	52,000 on February 17, 2014
	34,160 on February 15, 2015
	16,947 on February 20, 2016
Curtis L. Dinan	52,000 on February 17, 2014
	21,472 on February 15, 2015
	11,297 on February 20, 2016
Caron A. Lawhorn	36,000 on February 17, 2014
	21,472 on February 15, 2015
	11,297 on February 20, 2016
Gregory A. Phillips	16,000 on February 17, 2014
	7,808 on February 15, 2015
	5,649 on February 20, 2016
Joseph L. McCormick	7,200 on February 17, 2014
	2,928 on February 15, 2015
	5,281 on February 20, 2016

(3) The terms of both ONEOK’s restricted stock incentive units and ONEOK’s performance units provide that any such unvested units will become fully vested upon a change in control. See “Potential Post-Employment Payments and Payments Upon a Change in Control.” The separation will not constitute a change in control for purposes of these outstanding awards. For a discussion of the expected effect of the separation on these outstanding awards, see “Compensation Discussion and Analysis—Effects of Separation on Outstanding Executive Compensation Awards”.

Option Exercises and Stock Vested

The following table sets forth stock awards held by the named executive officers that became vested during 2013 which included restricted units and performance units which were granted in 2010. No named executive officer exercised any options during 2013, and no named executive officer currently holds any unexercised options.

Option Exercises and Stock Vested in Fiscal Year 2013

	Option Awards				Stock Awards(1)
Name	Number of Shares Acquired on Exercise		Value Realized on Exercise		Number of Shares Acquired on Vesting(2)		Value Realized on Vesting(3)
Pierce H. Norton II		—	$	—		43,000	$	2,053,250
Curtis L. Dinan		—	$	—		63,000	$	3,008,250
Caron A. Lawhorn		—	$	—		43,000	$	2,053,250
Gregory A. Phillips		—	$	—		16,000	$	764,000
Joseph L. McCormick		—	$	—		7,900	$	377,225

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(1) Certain of the named executive officers elected to have vested shares withheld to cover applicable state and federal taxes incurred upon vesting. As a result, the net shares received upon the vesting and the related net value realized are as follows:

Name	Net Shares Acquired on Exercise		Net Value Realized on Exercise		Net Shares Acquired on Vesting		Net Value Realized on Vesting
Pierce H. Norton II		—	$	—		22,662	$	1,082,137
Curtis L. Dinan		—	$	—		57,951	$	2,767,167
Caron A. Lawhorn		—	$	—		23,606	$	1,127,204
Gregory A. Phillips		—	$	—		8,306	$	396,692
Joseph L. McCormick		—	$	—		5,247	$	250,579

(2) Includes restricted stock incentive units and performance units granted in 2010 that vested in 2013 and that were paid in shares of ONEOK common stock. Performance units vested at 200 percent of the initial grant. This level of payout was achieved due to ONEOK’s relative total shareholder return being above the 90^th percentile of the total shareholder return of the specified peer group of energy companies.

(3) The value received on vesting represents the market value of the shares received based on the average of the high and low prices of ONEOK common stock on the NYSE on the date of vesting.

Pension Benefits

The following table sets forth the estimated present value of accumulated benefits as of December 31, 2013, and payments made during 2013, in respect of each named executive officer under each of the referenced retirement plans.

Pension Benefits as of December 31, 2013

Name	Plan Name	Number of Years Credited Service			Present Value of Accumulated Benefit(1)		Payments During Last Fiscal Year
Pierce H. Norton II	Supplemental Executive Retirement Plan		9.08		$	645,074	$	—
	Qualified Pension Plan		9.08		$	312,673	$	—
Curtis L. Dinan	Supplemental Executive Retirement Plan		10.00	(1)	$	893,411	$	—
	Qualified Pension Plan		10.00	(1)	$	228,483	$	—
Caron A. Lawhorn	Supplemental Executive Retirement Plan		15.25		$	582,868	$	—
	Qualified Pension Plan		15.25		$	518,818	$	—
Gregory A. Phillips	Supplemental Executive Retirement Plan		28.00	(2)	$	363,422	$	—
	Qualified Pension Plan		28.00	(2)	$	850,541	$	—
Joseph L. McCormick	Supplemental Executive Retirement Plan				$	—	$	—
	Qualified Pension Plan		11.00	(3)	$	378,556	$	—

(1) Mr. Dinan’s actual service is nine years and ten months. There is no resulting benefit augmentation with respect to the additional two months credited to Mr. Dinan’s years of service.

(2) Mr. Phillips’ actual service is 27 years and ten months. There is no resulting benefit augmentation with respect to the additional two months credited to Mr. Phillips’ years of service.

(3) Mr. McCormick’s actual service is ten years and ten months. There is no resulting benefit augmentation with respect to the additional two months credited to Mr. McCormick’s years of service.

Qualified Pension Plan. Effective January 1, 2014, we adopted the ONE Gas, Inc. Retirement Plan (our “Retirement Plan”), a tax-qualified pension plan that is substantially similar to the ONEOK, Inc. Retirement Plan. Our Retirement Plan is a defined benefit pension plan intended to be qualified under both the Tax Code and the Employee Retirement Income Security Act of 1974, as amended. Our Retirement Plan covers non-bargaining unit employees hired prior to January 1, 2005, and certain bargaining-unit employees. Non-bargaining unit employees hired after December 31, 2004, employees represented by Local No. 304 of the International Brotherhood of Electrical Workers hired on or after July 1, 2010, employees represented by United Steelworkers

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hired on or after December 15, 2011, and employees who accepted a one-time opportunity to opt out of the ONEOK, Inc. Retirement Plan, are covered by our Profit Sharing Plan.

Benefits under our Retirement Plan generally become vested and non-forfeitable after completion of five years of continuous employment. Under the plan, a vested participant receives a monthly retirement benefit at normal retirement age, unless an early retirement benefit is elected under the plan, in which case the retirement benefit may be actuarially reduced for early commencement. Generally, participants retiring on or after age 62 through normal retirement age receive 100 percent of their accrued monthly benefit which may be reduced depending on the optional form of payment elected at retirement. Benefits are calculated at retirement date based on a participant’s credited service, limited to a maximum of 35 years, and final average earnings. The earnings utilized in the Retirement Plan benefit formula for employees includes the base salary and short-term incentive compensation paid to an employee during the period of the employee’s final average earnings, less any amounts deferred under our non-qualified deferred compensation plan. The period of final average earnings means the employee’s highest earnings during any 60 consecutive months during the last 120 months of employment. For any named executive officer who retires with vested benefits under the plan, the compensation shown as “Salary” and “Non-Equity Incentive Plan Compensation” in the Summary Compensation Table for Fiscal 2013 would be considered eligible compensation in determining benefits, except that the plan benefit formula takes into account only fixed percentages of final average earnings. The amount of eligible compensation that may be considered in calculating retirement benefits is also subject to limitations in the Tax Code and the limitations contained in certain collective bargaining agreements applicable to the plan.

Supplemental Executive Retirement Plan. Effective January 1, 2014, we adopted a Supplemental Executive Retirement Plan (“SERP”) that is substantially similar to the ONEOK SERP. Our SERP also is closed to new participants. If a participant is eligible for both the supplemental retirement benefit and the excess retirement benefit, the excess retirement benefit and benefits payable under our Retirement Plan are treated as an offset that reduces the supplemental retirement benefit.

Supplemental benefits payable to participating employees in our SERP are based upon a specified percentage (reduced for early retirement and commencement of payment of benefits under the SERP) of the highest 36 consecutive month’s compensation of the employee’s last 60 months of service. The excess retirement benefit under our SERP pays a benefit equal at least to the benefit that would be payable to the participant under our Retirement Plan if limitations imposed by the Tax Code were not applicable, less the benefit payable under our qualified pension plan with such limitations. Benefits under our SERP are offset by the payment of benefits under our qualified pension plan that were or would have been paid if Retirement Plan benefits were commenced at the same time as the SERP benefits. We plan to fund benefits payable under our SERP through a rabbi trust arrangement. Our Board of Directors may amend or terminate the SERP at any time, provided that accrued benefits to current participants may not be reduced.

No new participants have been added to the ONEOK SERP since 2005, and our SERP is limited to individuals who previously were participants in the ONEOK SERP.

Nonqualified Deferred Compensation Plan. The following table sets forth certain information regarding the participation by the named executive officers in ONEOK’s Nonqualified Deferred Compensation Plan.

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Nonqualified Deferred Compensation in Fiscal Year 2013

Name	Year		Executive Contributions in Last Fiscal Year		Registrant Contributions in Last Fiscal Year(1)(2)		Aggregate Earnings in Last Fiscal Year(3)	Aggregate Withdrawals / Distributions		Aggregate Balance at Last Fiscal Year End
Pierce H. Norton II		2013	$	35,000	$	37,200		$	93,047
		2012	$	51,500	$	43,500		$	—
		2011	$	79,500	$	27,300		$	—
Curtis L. Dinan		2013	$	77,750	$	2,966,328		$	—
		2012	$	92,250	$	3,481,850		$	—
		2011	$	79,750	$	866,943		$	—
Caron A. Lawhorn		2013	$	79,500	$	21,300		$	15,551
		2012	$	88,000	$	26,400		$	15,420
		2011	$	49,500	$	18,300		$	7,474
Gregory A. Phillips		2013	$	5,900	$	8,100		$	—
		2012	$	8,080	$	10,080		$	—
		2011	$	3,480	$	5,280		$	—
Joseph L. McCormick		2013	$	46,590	$	11,200		$	—
		2012	$	49,150	$	15,950		$	—
		2011	$	27,850	$	8,400		$	—

(1) The “All Other Compensation” column of the Summary Compensation Table for Fiscal 2013 at page 118 includes these amounts paid as ONEOK’s matching contributions under ONEOK’s deferred compensation plan.

(2) Includes the value of 25,130 shares, the receipt of which was deferred by Mr. Dinan upon vesting in January 2010, 27,594 shares, the receipt of which was deferred upon vesting in January 2011, 74,504 shares, the receipt of which was deferred upon vesting in January 2012, and 56,000 shares, the receipt of which was deferred upon vesting in February 2013, in each case under the deferral provisions of ONEOK’s Equity Compensation Plan, plus the dividend accumulation on these deferrals for a year-end deferred share balance of 55,451, 133,830, and 194,956 for 2011, 2012, and 2013, respectively.

(3) There were no above-market earnings in 2013, 2012 or 2011.

Effective January 1, 2014, we adopted a Nonqualified Deferred Compensation Plan (“Deferred Compensation Plan”) that is substantially similar to the ONEOK Deferred Compensation Plan. Our Deferred Compensation Plan provides select employees with the option to defer portions of their compensation and provide nonqualified deferred compensation benefits that are not otherwise available due to limitations on employer and employee contributions to qualified defined contribution plans under the federal tax laws. We match contributions for the benefit of plan participants to replace any company contributions a participant may lose because of limits imposed under the federal tax laws on contributions by a participant in our 401(k) Plan and our Profit Sharing Plan, as well as participants in our Retirement Plan who do not participate in the SERP. The Deferred Compensation Plan also allows for supplemental credit amounts, which are amounts that can be contributed at the discretion of the Committee. Under the Deferred Compensation Plan, participants have the option to defer a portion of their salary and/or short-term incentive compensation to a short-term deferral account, which pays out a minimum of five years from the date of election to defer compensation into the short-term deferral account, or to a long-term deferral account, which pays out at retirement or termination of the participant’s employment. Participants are immediately 100-percent vested. Short-term deferral accounts are credited with an investment return based on the five-year United States Treasury bond rate as of the first business day of January each year that, for 2013, was 0.763 percent. Long-term deferral accounts are credited with the actual investment return based on the amount of gains, losses and earnings for each of the investment options

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selected by the participant. For the year ended December 31, 2013, the investment return for the investment options for long-term investment accounts were as follows:

Fund Name	Plan Level Returns
Fidelity Balanced Fund—Class K		%
Moody’s Corporate Bond Long-Term Yield AAA		%
Vanguard Institutional Index		%
Dodge & Cox International Stock Fund		%
American Beacon Funds Large Cap Value		%
Vanguard PRIMECAP		%
Schwab Mgd Retirement Income Class 3		%
Schwab Mgd Retirement Trust 2010 Class 3		%
Schwab Mgd Retirement Trust 2020 Class 3		%
Schwab Mgd Retirement Trust 2030 Class 3		%
Schwab Mgd Retirement Trust 2040 Class 3		%
Schwab Mgd Retirement Trust 2050 Class 3		%
JPMorgan Small Cap Equity (VSEIX)		%
JPMorgan Large Cap Growth Fund—Class R6		%
PIMCO Total Return Administration Fund		%

At the distribution date, cash is distributed to participants based on the fair market value of the deemed investment of the participant’s accounts at that date.

The ONEOK equity compensation plans allow deferrals of shares that would otherwise be paid with respect to equity awards. Any deferred shares are paid in the form of ONEOK stock at the time specified by the employee at the time of the deferral election. For a discussion of the expected effect of the separation on these deferred shares, see “Compensation Discussion and Analysis – Effects of Separation on Outstanding Executive Compensation Awards”.

Potential Post-Employment Payments and Payments Upon a Change in Control

Described below are the post-employment compensation and benefits that we provide to our named executive officers. The objectives of the post-employment compensation and benefits that we provide are to:

• assist in recruiting and retaining talented executives in a competitive market;

• provide security for any compensation or benefits that have been earned;

• permit executives to focus on our business;

• eliminate any potential personal bias of an executive against a transaction that is in the best interest of our shareholders;

• avoid the costs associated with separately negotiating executive severance benefits; and

• provide us with the flexibility needed to react to a continually changing business environment.

We do not enter into individual employment agreements with our executive officers. Instead, the rights of our executives with respect to specific events are covered by our compensation and benefit plans. Under this approach, post-employment compensation and benefits are established separately from the other compensation elements of our executives.

The use of a “plan approach” instead of individual employment agreements serves several objectives. First, the plan approach provides us with more flexibility to change the terms of severance benefits from time to time if necessary. Second, the plan approach is more transparent, both internally and externally. Internal transparency

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eliminates the need to negotiate separation benefits on a case-by-case basis and assures an executive that his or her severance benefits are comparable with those of his or her peers. Finally, the plan approach is easier for us to administer, as it requires less time and expense.

Payments Made Upon Any Termination. Regardless of the manner in which a named executive officer’s employment terminates, he or she is entitled to receive amounts earned during their term of employment. These amounts include:

• accrued but unpaid salary;

• amounts contributed under our 401(k) Plan, Profit Sharing Plan and Deferred Compensation Plan; and

• amounts accrued and vested through our Retirement Plan and SERP.

Payments Made Upon Retirement. In the event of the retirement of a named executive officer, in addition to the items identified above, such named executive officer will be entitled to:

• receive a prorated share of each outstanding performance unit granted under our ECP upon completion of the performance period;

• receive a prorated portion of each outstanding restricted stock incentive unit granted under our LTI Plan and our ECP upon completion of the restricted period; and

• participate in health and life benefits for the retiree and qualifying dependents.

Payments Made Upon Death or Disability. In the event of the death or disability of a named executive officer, in addition to the benefits listed under the headings “Payments Made Upon Any Termination” and “Payments Made Upon Retirement” above, the named executive officer will receive applicable benefits under our disability plan or payments under our life insurance plan.

Payments Made Upon or Following a Change in Control. We believe that the possibility of a change in control creates uncertainty for executive officers because such transactions frequently result in changes in senior management. Our Board of Directors has adopted a Change-in-Control Plan that covers all of our executive officers, including the named executive officers. Subject to certain exceptions, the Change-in-Control Plan will provide our officers with severance benefits if they are terminated by us without cause (as defined in the Change-in-Control Plan) or if they resign for good reason (as defined in the Change-in-Control Plan), in each case within two years following a change in control of ONE Gas. All change-in-control benefits are “double trigger,” meaning that payments and benefits under the plan are payable only if the officer’s employment is terminated by us without “cause” or by the officer for a “good reason” at any time during the two years following a change in control. Severance payments under the plan consist of a cash payment that may be up to three times the participant’s base salary and target short-term incentive bonus, plus reimbursement of COBRA healthcare premiums for 18 months. Our Board of Directors, upon the recommendation of the Committee, established a severance multiplier of one or two times annual salary plus target annual bonus for all participants in the Change-in-Control Plan, including two times for each of the named executive officers.

The Change-in-Control Plan does not provide for additional pension benefits upon a change in control. In addition, the Change-in-Control Plan does not contain an excise tax gross-up for any participant. Rather, severance payments and benefits under the Change-in-Control Plan will be reduced if, as a result of such reduction, the officer would receive a greater total payment after taking taxes, including excise taxes, into account.

Relative to the overall value of our company, we believe the potential benefits payable upon a change in control under the Change-in-Control Plan are comparatively minor, and we believe that the level of benefits is consistent with the general practice among our peers.

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For the purposes of the Change-in-Control Plan, a “change in control” generally means any of the following events:

• an acquisition of our voting securities by any person that results in the person having beneficial ownership of 20 percent or more of the combined voting power of our outstanding voting securities, other than an acquisition directly from us;

• the current members of our Board of Directors, and any new director approved by a vote of at least two-thirds of our Board, cease for any reason to constitute at least a majority of our Board, other than in connection with an actual or threatened proxy contest (collectively, the “Incumbent Board”);

• a merger, consolidation or reorganization with us or in which we issue securities, unless (a) our shareholders immediately before the transaction, as a result of the transaction, own, directly or indirectly, at least 50 percent of the combined voting power of the voting securities of the company resulting from the transaction, (b) the members of our Incumbent Board after the execution of the transaction agreement constitute at least a majority of the members of the Board of the company resulting from the transaction, or (c) no person other than persons who, immediately before the transaction owned 30 percent or more of our outstanding voting securities, has beneficial ownership of 30 percent or more of the outstanding voting securities of the company resulting from the transaction; or

• our complete liquidation or dissolution or the sale or other disposition of all or substantially all of our assets.

For the purposes of the Change-in-Control Plan, termination for “cause” means a termination of employment of a participant in the Change-in-Control Plan by reason of:

• a participant’s indictment for or conviction in a court of law of a felony or any crime or offense involving misuse or misappropriation of money or property;

• a participant’s violation of any covenant, agreement or obligation not to disclose confidential information regarding the business of the company (or a division or subsidiary) or a participant’s violation of any covenant, agreement or obligation not to compete with the company (or a division or subsidiary);

• any act of dishonesty by a participant that adversely affects the business of the company (or a division or subsidiary) or any willful or intentional act of a participant that adversely affects the business, or reflects unfavorably on the reputation, of the company (or a division or subsidiary);

• a participant’s material violation of any written policy of the company (or a division or subsidiary); or

• a participant’s failure or refusal to perform the specific directives of the Board or its officers, which are consistent with the scope and nature of the participant’s duties and responsibilities, to be determined in the Board’s sole discretion.

For the purposes of the Change-in-Control Plan, “good reason” means:

• a participant’s demotion or material reduction of the participant’s significant authority or responsibility with respect to employment with the company from that in effect on the date the change in control occurred;

• a material reduction in the participant’s base salary from that in effect immediately prior to the change in control;

• a material reduction in short-term and/or long-term incentive targets from those applicable to the participant immediately prior to the change in control;

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• the relocation to a new principal place of employment of the participant’s employment by the company, which is more than 35 miles farther from the participant’s principal place of residence than the participant’s principal place of employment was prior to such change; and

• the failure of a successor company to explicitly assume the Change-in-Control Plan.

Potential Post-Employment Payments Tables. The following tables reflect estimates of the incremental amount of compensation due each named executive officer in the event of such executive’s termination of employment by reason of death, disability or retirement, termination of employment without cause, or termination of employment without cause or with good reason within two years following a change in control. The amounts shown assume that such termination was effective as of December 31, 2013, are based upon the compensation and multipliers in effect under the ONEOK change-in-control plan as of such date, and are estimates of the amounts that would be paid to the executives upon such termination, including, with respect to performance units, the performance factor calculated as if the performance period ended on December 31, 2013. The amounts reflected in the “Qualifying Termination Following a Change in Control” column of the tables that follow are the amounts that would be paid pursuant to our Change-in-Control Plan and, with respect to the performance units, assume achievement of a performance factor at the target of 100 percent.

Pierce H. Norton II	Termination Upon Death, Disability or Retirement		Termination Without Cause		Qualifying Termination Following a Change in Control
Cash Severance	$	—	$	—	$	1,700,000
Health and Welfare Benefits	$	—	$	—	$	27,393
Equity
Restricted Stock/Unit
Performance Shares/Unit			$	—
Total
Total

Curtis L. Dinan	Termination Upon Death, Disability or Retirement		Termination Without Cause		Qualifying Termination Following a Change in Control
Cash Severance	$	—	$	—	$	1,435,500
Health and Welfare Benefits	$	—	$	—	$	27,393
Equity
Restricted Stock/Unit
Performance Shares/Unit			$	—
Total
Total

Caron A. Lawhorn	Termination Upon Death, Disability or Retirement		Termination Without Cause		Qualifying Termination Following a Change in Control
Cash Severance	$	—	$	—	$	1,188,000
Health and Welfare Benefits	$	—	$	—	$	27,393
Equity
Restricted Stock/Unit
Performance Shares/Unit			$	—
Total
Total

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Gregory A. Phillips	Termination Upon Death, Disability or Retirement		Termination Without Cause		Qualifying Termination Following a Change in Control
Cash Severance	$	—	$	—	$	783,000
Health and Welfare Benefits	$	—	$	—	$	27,393
Equity
Restricted Stock/Unit
Performance Shares/Unit			$	—
Total
Total

Joseph L. McCormick	Termination Upon Death, Disability or Retirement		Termination Without Cause		Qualifying Termination Following a Change in Control
Cash Severance	$	—	$	—	$	714,000
Health and Welfare Benefits	$	—	$	—	$	—
Equity
Restricted Stock/Unit
Performance Shares/Unit			$	—
Total
Total

Additional Equity Compensation Plan Information

Our equity compensation plans will not become effective until the separation is complete. The following table sets forth certain information concerning our equity compensation plans, as adopted by our Board of Directors and approved by ONEOK as our sole shareholder.

Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a)		Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (b)		Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities in Column (a)) (c)
Equity compensation plans approved by security holders(1)		—	$	—		3,625,000
Equity compensation plans not approved by security holders		—	$	—		—
Total		—	$	—		3,625,000

(1) Includes shares available under our Employee Stock Purchase Plan and Employee Stock Award Program, and stock options, restricted stock incentive units and performance-unit awards available under our ECP. Column (c) includes 700,000, 125,000 and 2,800,000 shares available for future issuance under our Employee Stock Purchase Plan, Employee Stock Award Program and ECP, respectively.

Director Compensation

Compensation for ONEOK non-management directors for their service on the ONEOK board of directors for the period May 2013 through April 2014 consists of an annual cash retainer of $65,000 and a common stock retainer with a value of $135,000. The chairs of the ONEOK Executive Compensation and Audit Committees each receive an additional annual retainer of $15,000 each, and the chair of the ONEOK Corporate Governance Committee (who serves as the ONEOK lead director) receives an additional annual cash retainer of $20,000.

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The members of the ONE Gas board of directors were not paid any compensation during 2013. During 2014, we expect that the members of the ONE Gas board will be paid a cash retainer of $65,000 and a common stock retainer with a value of $85,000. We expect that the chairs of the ONE Gas Audit and Executive Compensation Committees will receive an additional cash retainer of $15,000 each, and the chair of the ONE Gas Corporate Governance Committee (who also serves as the ONE Gas lead director) will receive an additional cash retainer of $20,000. Finally, we expect that the non-executive chairman of the ONE Gas board will receive an annual retainer of $75,000.

We expect to reimburse ONE Gas directors for reasonable expenses incurred in connection with attendance at board and committee meetings. A director who is also an officer or employee is not expected to receive any compensation for his or her service as a director.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

As of the date of this Information Statement, ONEOK beneficially owns all of the outstanding shares of our common stock. After the distribution, ONEOK will not own any shares of our common stock.

The following table provides information with respect to the expected beneficial ownership of our common stock by (1) each of our shareholders who we believe will be a beneficial owner of more than 5 percent of our outstanding common stock, (2) each of the persons nominated to serve as our directors, (3) each officer named in the Summary Compensation Table, and (4) all of our executive officers and director nominees as a group. We based the share amounts on each person’s beneficial ownership of ONEOK common stock as of                     ,     , unless we indicate some other basis for the share amounts and assuming a distribution ratio of one share of our common stock for each share of ONEOK common stock.

Except as otherwise noted in the footnotes below, each person or entity identified below has sole voting and investment power with respect to such securities. Following the distribution, we will have outstanding an aggregate of approximately              million shares of common stock, based upon approximately              shares of ONEOK common stock outstanding on                         ,     , excluding treasury shares and applying the distribution ratio of shares of our common stock for each share of ONEOK common stock held as of the record date. We do not currently have and, immediately following the distribution, we do not expect to have any outstanding stock options or warrants to purchase common stock, and the number of shares does not include any such options or warrants.

To the extent our directors and officers own ONEOK common stock at the time of the distribution, they will participate in the distribution on the same terms as other holders of ONEOK common stock.

Information regarding stock ownership will be included in subsequent amendments.

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CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

The Distribution from ONEOK

The distribution will be accomplished by ONEOK distributing all of its shares of our common stock to holders of ONEOK common stock entitled to such distribution, as described in the section entitled “The Separation.” Completion of the distribution will be subject to satisfaction or waiver by ONEOK of the conditions to the separation and distribution described below.

Review of Transactions with Related Persons

Our board of directors expects to adopt policies and procedures for the review, approval or ratification of any transaction involving an amount in excess of $120,000 in which any director or executive officer of ours, any nominee for director, or any immediate family member of the foregoing had a material interest as contemplated by Item 404(a) of Regulation S-K. Under these policies and procedures, we expect the Audit Committee or a subcommittee of our board of directors comprised of independent directors, and, if warranted, our board of directors, would review the transaction and either approve or reject the transaction after taking into account the following factors:

• the parties to the transaction, their relationship to the company and nature of their interest in the transaction;

• the nature of the transaction;

• the aggregate value of the transaction;

• the length of the transaction;

• whether the transaction occurs in the normal course of our business;

• the benefits to our company provided by the transaction;

• if applicable, the availability of other sources of comparable products or services; and

• if applicable, whether the terms of the transaction, including price or other consideration, are the same or substantially the same as those available to the company if the transaction were entered into with an unrelated party.

We expect the policy to require each executive officer and director to annually provide us written disclosure of any transaction in which we participate and in which the officer or director or any of his or her immediate family members has a direct or indirect material interest. We expect that our Corporate Governance Committee will review our disclosure of related-party transactions in connection with its annual review of director independence. The policy would not apply to (a) compensation and transactions involving a director or an executive officer solely resulting from that person’s service as a director or employment with us so long as the compensation is reported in our filings with the SEC or (b) any other categories of transactions currently or in the future excluded from the reporting requirements of Item 404(a) of Regulation S-K.

Agreements with ONEOK

We will enter into the Separation and Distribution Agreement and several other agreements with ONEOK to effect the separation and provide a framework for our relationships with ONEOK after the distribution. These agreements will govern the relationship between us and ONEOK subsequent to the completion of the distribution, and provide for the allocation among us and ONEOK of the assets, liabilities and obligations (including employee benefits and tax-related assets and liabilities) relating to the natural gas distribution business attributable to periods prior to, at and after the distribution. In addition to the Separation and Distribution

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Agreement (which contains many of the key provisions related to our separation from ONEOK and the distribution of our shares of common stock to ONEOK shareholders), these agreements include:

• Transition Services Agreement;

• Tax Matters Agreement;

• Employee Matters Agreement; and

• one or more Management Agreements, if needed.

These principal agreements will be filed as exhibits to the registration statement on Form 10, of which this Information Statement is a part. The agreements described below and the summaries of each of these agreements set forth the terms of the agreements that we believe are material. These summaries are qualified by the full text of the applicable agreements. The terms of the agreements described below that will be in effect following the distribution have not yet been finalized; changes, some of which may be material, may be made prior to the distribution. No changes may be made after the distribution without our consent. The agreements we enter into with ONEOK will be prepared in the context of our separation from ONEOK while we are still part of ONEOK and, accordingly, may not reflect terms that would have resulted from arm’s-length negotiations among unaffiliated third parties.

Separation Costs

Prior to the separation, ONEOK expects to incur separation costs for professional services, including financial advisors, legal, accounting, information technology, human resources and other business consultants. ONEOK will not allocate these separation costs to us. Subsequent to the separation, we will incur additional expenses as a result of being a stand-alone publicly traded company. Under the terms of the Separation and Distribution Agreement, we will be responsible for all costs and expenses that we incur as a stand-alone company after the distribution.

Separation and Distribution Agreement

The Separation and Distribution Agreement will set forth our agreements with ONEOK regarding the principal transactions necessary to effect the separation. It will also set forth other agreements that govern certain aspects of our relationship with ONEOK after the completion of the separation. We intend to enter into the Separation and Distribution Agreement before the distribution of our common stock to ONEOK shareholders.

Transfer of Assets and Assumption of Liabilities. The Separation and Distribution Agreement will identify assets to be transferred, liabilities to be assumed, and contracts to be assigned to each of us and ONEOK as part of the separation, and will describe when and how these transfers, assumptions, and assignments will occur, although, some of the transfers, assumptions, and assignments may have already occurred prior to the parties’ entering into the Separation and Distribution Agreement. In particular, the Separation and Distribution Agreement will provide that, subject to the terms and conditions contained in the agreement:

• Subject to certain exceptions, all of the assets and liabilities (including whether accrued, contingent or otherwise) primarily used in, related to or arising out of the natural gas distribution business of ONEOK, which provides natural gas distribution services in Kansas, Oklahoma, and Texas, will be transferred to us or one of our subsidiaries.

• Subject to certain exceptions, all of the assets and liabilities (including whether accrued, contingent, or otherwise) that are not primarily used in, related to or arising out of the natural gas distribution business, including those assets and liabilities associated with the ownership of the equity interests in ONEOK Partners GP, L.L.C. and its general partner interest in ONEOK Partners and the business of providing wholesale natural gas supply and related services for natural gas and electric utilities and commercial and industrial customers, will be retained by ONEOK or one of its subsidiaries (other than us or one of our subsidiaries).

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• Liabilities (including whether accrued, contingent, or otherwise) related to, arising out of or resulting from businesses of ONEOK that were previously terminated or divested will be retained by ONEOK. ONEOK’s retention of liability does not include liabilities associated with the divesture of businesses or assets arising out of the natural gas distribution business.

• Each party or one of its subsidiaries will assume or retain any liabilities (including under applicable federal and state securities laws) relating to, arising out of or resulting from any registration statement or similar disclosure document that offers for sale by such party any security after the separation.

• Each party or one of its subsidiaries will assume or retain any liabilities (including under applicable federal and state securities laws) relating to, arising out of or resulting from any registration statement or similar disclosure document that offers for sale any security prior to the separation to the extent such liabilities arise out of, or result from, matters related to their respective businesses.

• ONEOK will assume or retain any liability relating to, arising out of or resulting from any registration statement or similar disclosure document related to the separation (including the Form 10 and this Information Statement), but only to the extent such liability derives from a material misstatement or omission contained in the portions of this Information Statement that relate to ONEOK. We will assume or retain any other liability relating to, arising out of or resulting from our registration statement or similar disclosure documents related to the separation (including our Form 10 and Information Statement).

• Each party shall be responsible for its allocated percentage of any contingent corporate liability that does not relate to either the natural gas distribution business or ONEOK’s remaining businesses.

Except as otherwise set forth in the Separation and Distribution Agreement, the allocation of liabilities with respect to taxes will be governed solely by the Tax Matters Agreement, and the allocation of liabilities with respect to employees and employee benefits matters will be governed solely by the Employee Matters Agreement, which are described below.

Except as may expressly be set forth in the Separation and Distribution Agreement or any ancillary agreement, all assets will be transferred on an “as is,” “where is” basis and the respective transferees will bear the economic and legal risks that any conveyance will prove to be insufficient to vest in the transferee good title, free and clear of any security interest, that any necessary consents or governmental approvals are not obtained, and that any requirements of laws or judgments are not complied with.

Information in this Information Statement with respect to the assets and liabilities of the parties following the separation is presented based on the allocation of such assets and liabilities pursuant to the Separation and Distribution Agreement, unless the context otherwise requires. Certain of the liabilities and obligations to be assumed by one party or for which one party will have an indemnification obligation under the Separation and Distribution Agreement and the other agreements relating to the separation are, and following the separation may continue to be, the legal or contractual liabilities or obligations of another party. Each such party that continues to be subject to such legal or contractual liability or obligation will rely on the applicable party that assumed the liability or obligation or the applicable party that undertook an indemnification obligation with respect to the liability or obligation, as applicable, under the Separation and Distribution Agreement, to satisfy the performance and payment obligations or indemnification obligations with respect to such legal or contractual liability or obligation.

Further Assurances. To the extent that any transfers of assets or assumptions of liabilities contemplated by the Separation and Distribution Agreement have not been consummated on or prior to the date of the separation, the parties will agree to cooperate to effect such transfers or assumptions as promptly as practicable following the date of the separation. In addition, each of the parties will agree to cooperate with each other and use commercially reasonable efforts to take or to cause to be taken all actions, and to do, or to cause to be done, all things reasonably necessary under applicable law or contractual obligations to consummate and make effective

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the transactions contemplated by the Separation and Distribution Agreement and the ancillary agreements. In the event that the transfer of any asset or the assignment of any contract to us requires the consent of a third party which has not been obtained at the time of the closing of the separation, the Separation and Distribution Agreement provide that such asset or contract shall be retained pending receipt of such consent and we shall receive the benefits and bear the burdens of such asset or contract from and after the separation.

The Distribution. The Separation and Distribution Agreement will also govern the rights and obligations of the parties regarding the proposed distribution. Prior to the distribution, we will distribute to ONEOK as a stock dividend the number of shares of our common stock distributable in the distribution. ONEOK will cause its agent to distribute to ONEOK shareholders as of the applicable record date all the issued and outstanding shares of our common stock. ONEOK will have the sole and absolute discretion to determine (and change) the terms of, and whether to proceed with, the distribution and, to the extent it determines to so proceed, to determine the date of the distribution.

Conditions. The Separation and Distribution Agreement will provide that the distribution is subject to several conditions that must be satisfied or waived by ONEOK in its sole discretion:

• the SEC shall have declared effective our registration statement on Form 10, of which this Information Statement is a part, under the Exchange Act, and no stop order relating to the registration statement shall be in effect, and this Information Statement shall have been mailed to the holders of ONEOK’s common stock;

• ONEOK shall have received a surplus and solvency opinion from a nationally recognized valuation firm, in form and substance satisfactory to ONEOK, with respect to whether ONEOK should have adequate surplus to declare the distribution dividend and that, following the separation and distribution, each of ONEOK and ONE Gas should be solvent and adequately capitalized;

• all required federal, state and municipal approvals (including approval of the Kansas Corporation Commission) and consents necessary to consummate the separation and distribution shall have been received;

• we shall have received approximately $1.19 billion of cash from the issuance of debt securities and shall have made a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures;

• The IRS Ruling received by ONEOK shall not have been withdrawn, invalidated or modified in an adverse manner, and ONEOK shall have received the opinion of Skadden, tax counsel to ONEOK, which opinion will rely on the continued validity of the IRS Ruling, with respect to certain issues relating to the tax-free nature of the transactions that are not addressed in or covered by the IRS Ruling.

• the listing of our common stock on the NYSE shall have been approved, subject to official notice of issuance;

• no order, injunction or decree issued by any court of competent jurisdiction or other legal restraint or prohibition preventing consummation of the distribution or any of the transactions related thereto, including the debt financing, the transfers of assets and liabilities contemplated by the Separation and Distribution Agreement shall be in effect; and

• the board of directors of ONEOK shall have approved the distribution, which may be given or withheld in its absolute and sole discretion.

The fulfillment of these conditions will not create any obligation on ONEOK’s part to effect the distribution. ONEOK has the right not to complete the distribution if, at any time, ONEOK’s board of directors determines, in its sole discretion, that the distribution is not in the best interests of ONEOK or its shareholders or that market conditions are such that it is not advisable to separate the natural gas distribution business from ONEOK.

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Releases and Indemnification. Except as otherwise provided in the Separation and Distribution Agreement or any ancillary agreement, each party will release and forever discharge the other party and its subsidiaries and affiliates from all liabilities existing or arising from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur or any conditions existing or alleged to have existed on or before the separation. The releases will not extend to obligations or liabilities under any agreements between the parties that remain in effect following the separation pursuant to the Separation and Distribution Agreement or any ancillary agreement.

In addition, the Separation and Distribution Agreement will provide for cross-indemnities that, except as otherwise provided in the Separation and Distribution Agreement, are principally designed to place financial responsibility for the obligations and liabilities of our business with us and the financial responsibility for the obligations and liabilities of ONEOK’s business with ONEOK. Specifically, each party will, and will cause its subsidiaries and affiliates to, indemnify, defend and hold harmless the other party, its affiliates and subsidiaries and each of their officers, directors, employees, and agents for any losses arising out of or otherwise in connection with:

• the liabilities each such party assumed or retained pursuant to the Separation and Distribution Agreement;

• the operation of each such party’s business, whether prior to or after the distribution; and

• any breach by such party of the Separation and Distribution Agreement or ancillary agreement.

Except as otherwise set forth in the Separation and Distribution Agreement, indemnification with respect to taxes will be governed solely by the Tax Matters Agreement and indemnification with respect to employee and employee benefits matters will be governed solely by the Employee Matters Agreement, which are described below.

Legal Matters. Except as otherwise set forth in the Separation and Distribution Agreement (or as further described below), each party to the Separation and Distribution Agreement will assume the liability for, and control of, all pending and threatened legal matters related to its own business or assumed or retained liabilities and will indemnify the other party for any liability arising out of or resulting from such assumed legal matters. Each party to a claim will agree to cooperate in defending any claims against the other party for events that took place prior to, on or after the date of separation.

Insurance. Following the separation, we will be responsible for obtaining and maintaining our own insurance coverage and will no longer be an insured party under ONEOK’s insurance policies, except in specified circumstances set forth in the Separation and Distribution Agreement.

Other Matters Governed by the Separation and Distribution Agreement. Other matters governed by the Separation and Distribution Agreement include access to financial and other information, intellectual property, confidentiality, access to and provision of records and treatment of outstanding guarantees and similar credit support.

Tax Matters Agreement

Allocation of Taxes. In connection with the separation, we and ONEOK will enter into the Tax Matters Agreement to govern the parties’ respective rights, responsibilities and obligations with respect to tax liabilities and benefits, tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and other matters regarding taxes. In general, under the agreement:

• We are responsible for any and all taxes (and any related interest, penalties or audit adjustments) reportable on a tax return filed by ONEOK or any of its subsidiaries which taxes are attributable to the natural gas distribution business, and ONEOK is responsible for any other taxes reportable on such tax returns; and

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• We are responsible for any and all taxes (and any related interest, penalties or audit adjustments) reportable on tax returns that include only us and/or any of our subsidiaries; and

• We are entitled to any refund of taxes for which we are responsible under the Tax Matters Agreement, and ONEOK will compensate us for any net operating tax losses of the natural gas distribution business for pre-closing periods. ONEOK is entitled to any refund of taxes for which it is responsible under the Tax Matters Agreement.

We will settle the foregoing with ONEOK based on the estimated amount of our tax liability (or, if applicable, our estimated right to compensation for net losses), immediately prior to the separation. If such settlement amount is in excess of what is later determined to be due and owing, ONEOK will pay the difference to us, and if such settlement amount is less than what is later determined to be due and owing, we will pay the difference to ONEOK. Similar rules apply to the compensation for certain of our losses, if any. Any settlement payments required to be made under the Tax Matters Agreement shall include interest at a specified rate. Neither party’s obligations under the agreement are limited in amount or subject to any cap.

The agreement also assigns responsibilities for administrative matters, such as the filing of returns, payment of taxes due, retention of records and conduct of audits, examinations or similar proceedings. In addition, the agreement provides for cooperation and information sharing with respect to tax matters.

ONEOK is primarily responsible for preparing and filing any tax return with respect to the ONEOK affiliated group for U.S. federal income tax purposes and with respect to any consolidated, combined, unitary or similar group for U.S. state or local income tax purposes or U.S. state or local non-income tax purposes that includes ONEOK or any of its subsidiaries, including those that also include us and/or any of our subsidiaries. We are generally responsible for preparing and filing any tax returns that include only us and/or any of our subsidiaries.

The party responsible for preparing and filing a given tax return generally has exclusive authority to control tax contests related to any such tax return. We generally have exclusive authority to control tax contests with respect to tax returns that include only us and/or any of our subsidiaries.

Preservation of the Tax-Free Status of Certain Aspects of the Separation. We and ONEOK intend the distribution to qualify as a tax-free transaction to ONEOK, us, and the ONEOK shareholders under Sections 355 and 368(a)(1)(D) of the Code. In addition, we and ONEOK intend for certain related transactions to qualify for tax-free treatment under U.S. federal, state and local tax law.

ONEOK has received the IRS Ruling to the effect that the distribution, together with certain related transactions, will qualify as a transaction that is tax-free to ONEOK, us and the ONEOK shareholders for U.S. federal income tax purposes under Sections 355, 368(a)(1)(D) and other related provisions of the Code. In addition, ONEOK expects to receive an opinion from Skadden, tax counsel to ONEOK, regarding the tax-free status of the distribution. In connection with the IRS ruling and the opinion, we and ONEOK have made and will make certain representations regarding the past and future conduct of our respective businesses and certain other matters.

We will also make certain covenants that include restrictions on us intended to preserve the tax-free status of the distribution and certain related transactions. We may take certain actions prohibited by these covenants only if ONEOK receives a private letter ruling from the IRS or we obtain and provide to ONEOK an opinion from U.S. tax counsel or an accountant of recognized national standing, in either case acceptable to ONEOK in its sole and absolute discretion, to the effect that such action would not jeopardize the tax-free status of the distribution and certain related transactions. We will be barred from taking any action, or failing to take any action, where such action or failure to act adversely affects or could reasonably be expected to adversely affect the tax-free status of these transactions, for all periods. In addition, during the time period ending two years after the date of the distribution, these covenants include specific restrictions on our ability to:

• issue or sell stock or other securities (including securities convertible into our stock but excluding certain compensatory arrangements) or merge or consolidate with another party;

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• sell assets outside the ordinary course of business, or materially change the manner of operating our business; and

• enter into any other corporate transaction which would cause us to undergo a 40 percent or greater change in our stock ownership.

We will generally agree to indemnify ONEOK and its affiliates against any and all tax-related liabilities incurred by them relating to the distribution and/or certain related transactions to the extent caused by an acquisition of our stock or assets or by any other action we undertake. This indemnification applies even if ONEOK has permitted us to take an action that would otherwise have been prohibited under the tax-related covenants described above.

Transition Services Agreement

The Transition Services Agreement with ONEOK will provide for an orderly transition to being an independent, publicly-traded company. Under the Transition Services Agreement, ONEOK will agree to provide us, and we will agree to provide ONEOK, with various services, including services relating to treasury and risk management, environmental management, tax compliance, telecommunications services and information technology services.

Under the Transition Services Agreement, we will pay a fee to ONEOK for the services needed by us and ONEOK will pay a fee to us for the services needed by it, which fees are intended to allow the relevant service provider to recover all of its direct and indirect costs, without profit. The Transition Services Agreement is being negotiated in the context of a parent-subsidiary relationship and in the context of the separation of ONEOK into two companies. Unless specifically indicated in the agreement, all services to be provided under the Transition Services Agreement will be provided for a specified period of time generally not to extend beyond 12 to 24 months, although the parties may mutually agree to terminate some or all of those services in advance of the specified time period. After the expiration of the arrangements contained in the Transition Services Agreement, we may not be able to replace these services in a timely manner or on terms and conditions, including cost, as favorable as those we have received from ONEOK. We are developing a plan to increase our own internal capabilities in the future to reduce our reliance on ONEOK for these services. We will have the right to receive reasonable information with respect to the charges to us by ONEOK and other service providers for transition services provided by them.

Employee Matters Agreement

The Employee Matters Agreement with ONEOK will allocate liabilities and responsibilities relating to employee compensation and benefit plans and programs and other related matters in connection with the separation, including the treatment of outstanding incentive awards and certain retirement and welfare benefit obligations. The Employee Matters Agreement will also provide that outstanding ONEOK stock-based incentive compensation awards will be adjusted equitably in connection with the distribution. For further information see “Compensation Discussion and Analysis—Effects of Separation on Outstanding Executive Compensation Awards “ beginning on page 116 of this Information Statement.

Our participation in the ONEOK benefit plan arrangements will cease effective with the separation, but our benefit plans generally will credit service with ONEOK before the separation. We expect the Employee Matters Agreement will provide as a general matter that we and ONEOK will retain liability for employees and other individual service providers historically associated with our and their respective businesses.

Management Agreement

ONEOK has been granted franchises by certain municipalities which allow it to provide natural gas distribution services within the relevant municipality. Some of those franchise agreements require consent of the

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municipality to assign those agreements to us. In addition, a limited number of those franchise agreements prohibit ONEOK from transferring to us ownership of ONEOK’s natural gas distribution assets in that municipality until the municipality has consented to assignment of the franchise agreement. In connection with the separation, we will seek those consents where required.

If ONEOK is unable to obtain all such municipal consents prior to the separation, then we plan to enter into one or more Management Agreements with ONEOK to allow the continuation of natural gas service to our customers until such consent is obtained. Under the Management Agreement, ONEOK would retain the relevant unassigned franchise and, if applicable, the underlying assets, and we would agree to manage and operate the natural gas distribution business for ONEOK in such municipality. The Management Agreement would provide us with the right to receive all revenues and be obligated to pay all expenses associated with the natural gas business in such municipality. We would indemnify and hold ONEOK harmless against any liabilities that ONEOK may incur by reason of being the counterparty on the franchise agreement or the owner of the assets. Upon receipt of consent from the relevant municipality, the franchise agreement, and, if applicable, the underlying assets, will be assigned to us and the Management Agreement will automatically expire.

Director Interlocks

John W. Gibson, the current chief executive officer and chairman of each of ONEOK and ONEOK Partners, will resign as an employee of ONEOK at or shortly prior to the separation and will become the non-executive chairman of our board of directors and the boards of directors of each of ONEOK and ONEOK Partners.

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DESCRIPTION OF ONE GAS CAPITAL STOCK

We have provided below a summary description of our capital stock. You should read the full text of our amended and restated certificate of incorporation and amended and restated bylaws, which will be filed as exhibits to the registration statement on Form 10 into which this Information Statement is incorporated, as well as the provisions of applicable Oklahoma law.

General

The total number of authorized shares of capital stock of ONE Gas will consist of shares of common stock, par value $0.01 per share, and shares of preferred stock, par value $0.01 per share. Based on the anticipated distribution ratio of share of ONE Gas stock for each share of ONEOK stock held as of the record date for the date of distribution, we expect to have approximately      holders of record immediately after the distribution based on the number of record holders of ONEOK stock as of         ,             .

Common Stock

Voting Rights

Holders of our common stock are entitled to one vote for each share held by them on all matters submitted to our shareholders. Holders of our common stock do not have cumulative voting rights in the election of directors. Generally, all matters to be voted on by shareholders must be approved by a majority of the votes entitled to be cast by the holders of common stock present in person or represented by proxy, voting together as a single class, subject to any voting rights granted to holders of any preferred stock.

Dividend Rights

Holders of our common stock will share equally on a per share basis in any dividend declared by our board of directors out of funds legally available for that purpose, subject to any preferential rights of holders of any outstanding shares of preferred stock.

Other Rights

Upon voluntary or involuntary liquidation, dissolution or winding up of our company, after payment in full of the amounts required to be paid to creditors and holders of any preferred stock that may be then outstanding, all holders of common stock are entitled to share equally on a pro rata basis in all remaining assets.

No shares of common stock are subject to redemption or have preemptive rights to purchase additional shares of common stock or other securities of our company. There are no other subscription rights or conversion rights and there are no sinking fund provisions applicable to our common stock.

Preferred Stock

Our board of directors is authorized to issue shares of preferred stock, in one or more series or classes, and to fix for each series or class the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications, or terms or redemption, as are permitted by Oklahoma law and as are stated in the resolution or resolutions adopted by our board providing for the issuance of shares of that series or class.

Amendment of Bylaws

Except as otherwise provided by law, our certificate of incorporation or our bylaws, our bylaws may be amended, altered or repealed at (i) a meeting of the shareholders provided that notice of such amendment, alteration or appeal is contained in the notice of such meeting or (ii) a meeting of our board of directors.

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All such amendments must be approved by either the holders of at least 80 percent of the voting power of our then outstanding shares of common stock or by a majority of our entire board of directors then in office.

Amendment of the Certificate of Incorporation

Any proposal to amend, alter, change or repeal any provision of our certificate of incorporation, except as otherwise provided in our certificate of incorporation or as may be provided in the terms of any preferred stock, requires approval by the affirmative vote of both a majority of the members of our board of directors then in office and a majority vote of the voting power of all of the shares of our capital stock entitled to vote generally in the election of directors, voting together as a single class. Our certificate of incorporation also requires the affirmative vote of the holders of 80% of our then outstanding shares to amend, repeal or adopt provisions in our certificate of incorporation relating to, among other things,

• the number of directors and the manner of electing those directors, including the election of directors to newly created directorships and the classification of our board of directors;

• provisions relating to changes in the bylaws;

• a director’s personal liability to us or our shareholders;

• shareholder ratification of various contracts, transactions and acts; and

• voting requirements for approval of business combinations.

Shareholder Action; Special Meeting

Our certificate of incorporation eliminates the ability of our shareholders to act by written consent. Our certificate of incorporation provides that special meetings of our shareholders may be called only by a majority of the members of our board of directors.

Exculpation and Indemnification

Our certificate of incorporation provides that our directors and officers will not be personally liable for monetary damages for any action taken, or any failure to take any action, unless:

• the director or officer has breached his or her duty of loyalty to the corporation or its shareholders;

• the breach or failure to perform constitutes an act or omission not in good faith or which involves intentional misconduct or a knowing violation of law;

• the director served at the time of payment of an unlawful dividend or an unlawful stock purchase or redemption, unless the director was absent at the time the action was taken or dissented from the action; or

• the director or officer derived an improper personal benefit from the transaction.

We will generally indemnify any person who was, is, or is threatened to be made, a party to a proceeding by reason of the fact that he or she:

• is or was our director, officer, employee or agent; or

• while our director, officer, employee or agent is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

Any indemnification of our directors, officers or others pursuant to the foregoing provisions for liabilities arising under the Securities Act are, in the opinion of the SEC, against public policy as expressed in the Securities Act and are unenforceable.

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Advance Notice Requirements for Shareholder Proposals

At any annual meeting of our shareholders, the only business that shall be brought before the meeting is that which is brought:

• pursuant to our notice of meeting;

• by or at the discretion of our board of directors; or

• by any of our shareholders of record at the time the notice is given, who shall be entitled to vote at the meeting and who complies with the notice procedures set forth herein.

For business to be properly brought before an annual meeting by a shareholder, the shareholder must have given timely notice in writing to our secretary. To be timely, a shareholder’s notice must be received at our principal executive offices not less than 120 calendar days before the anniversary of the date our proxy statement was released to shareholders in connection with the previous year’s annual meeting; provided however, that if the date of the meeting is changed by more than 30 days from the date of the previous year’s meeting, notice must be received no later than the close of business on the 10th day following the earlier of the day on which notice of the date of the meeting was mailed to shareholders or public disclosure of that date was made. The shareholder notice shall set forth as to each matter the shareholder proposes to bring before the meeting:

• a brief description of and the reasons for proposing the matter at the meeting;

• with respect to the shareholder giving notice or the beneficial owner, if any on whose behalf the proposal is made: (a) the name and address of such person, (b) the class or series and number of shares which are owned beneficially and of record by such person, (c) the name of each nominee holder of shares owned beneficially but not of record and the number of such shares held by each such nominee, (d) whether and the extent to which any derivative instrument, swap, option or similar transaction was entered into by or on behalf of such person or any of its affiliates or associates, and (e) whether and the extent to which any other agreement has been made by or on behalf of such person or any of its affiliates or associates to mitigate loss or manage risk of such person or to increase or decrease the voting power or other interest of such person;

• a representation that the shareholder giving notice intends to appear in person or by proxy at the annual meeting;

• any material interest of such shareholder of record or beneficial owner, if any, on whose behalf the proposal is made, or any of their respective affiliates or associates, in such proposal;

• a description of all agreements between the shareholder, the beneficial owner, if any, on whose behalf the proposal is made, or any of their respective affiliates or associates, in connection with the proposal of such business by such shareholder; and

• all other information that would be required to be disclosed by such shareholder or the beneficial owner, if any, on whose behalf the proposal is made in connection with solicitation of proxies for the election of directors in a contested election, pursuant to Regulation 14A of the Exchange Act.

These provisions may impede shareholders’ ability to bring matters before an annual meeting of shareholders.

Higher Vote for Some Business Combinations and Other Actions

Subject to various exceptions, including acquiring 85 percent of the outstanding shares less shares owned by related persons in a single transaction, a business combination (including, but not limited to, a merger or consolidation, the sale, lease, exchange, transfer or other disposition of our assets in excess of $5,000,000, various issuances and reclassifications of securities and the adoption of a plan or proposal for liquidation or dissolution) with or upon a proposal by a related person, who is a person that is the direct or indirect beneficial owner of more than 10 percent of the outstanding voting shares of our stock (subject to various exceptions), and

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any affiliates of that person, shall require, in addition to any approvals required by law, the approval of the business combination by either:

• a majority vote of all of the independent directors; or

• the holders of at least two-thirds of the outstanding shares otherwise entitled to vote as a single class with the common stock to approve the business combination, excluding any shares owned by the related person.

Transactions with Interested Parties

Our certificate of incorporation provides that, in the absence of fraud, no contract or other transaction will be affected or invalidated by the fact that any of our directors are in any way interested in or connected with any other party to the contract or transaction or are themselves parties to the contract or transaction, provided that the interest is fully disclosed or otherwise known to our board of directors at the meeting of our board of directors at which the contract or transaction is authorized or confirmed, and provided further that a quorum of disinterested directors is present at the meeting of our board of directors authorizing or confirming the contract or transaction and the contract or transaction is approved by a majority of the quorum, and no interested director votes on the contract or transaction. Any contract, transaction or act entered into or taken by us or our board or any committee thereof that is ratified by a majority of a quorum of the shareholders having voting power at any annual meeting, or any special meeting called for that purpose, will be valid and binding as though ratified by all of our shareholders. Any director may vote upon any contract or other transaction between us and any subsidiary corporation without regard to the fact that he is also a director of that subsidiary corporation. No contract or agreement between us and any other corporation or party that owns a majority of our capital stock or any subsidiary of that other corporation shall be made or entered into without the affirmative vote of a majority of the whole board of directors at a regular meeting of the board.

Classified Board of Directors

Our certificate of incorporation provides for our board of directors to be divided into three classes of directors, as nearly equal in number as possible, serving staggered terms. Approximately one-third of our board will be elected each year. The provision for our classified board may be amended, altered or repealed upon the approval of our board of directors and the affirmative vote of the holders of at least 80 percent of the voting power of the shares entitled to vote at an election of directors.

The provision for a classified board could prevent a party that acquires control of a majority of the outstanding voting stock from obtaining control of our board until the second annual shareholders meeting following the date the acquiror obtains the controlling stock interest. The classified board provision could have the effect of discouraging a potential acquiror from making a tender offer for our shares or otherwise attempting to obtain control of us and could increase the likelihood that our incumbent directors will retain their positions.

We believe that a classified board will help to assure the continuity and stability of our board and our business strategies and policies as determined by our board, because a majority of the directors at any given time will have prior experience on our board. The classified board provision should also help to ensure that our board of directors, if confronted with an unsolicited proposal from a third party that has acquired a block of our voting stock, will have sufficient time to review the proposal and appropriate alternatives and to seek the best available result for all shareholders.

We expect that Class I directors will have an initial term expiring on the date of the first annual meeting following the distribution, Class II directors will have an initial term expiring on the date of the second annual meeting following the distribution and Class III directors will have an initial term expiring on the date of the third annual meeting following the distribution. After the distribution, we expect our board will consist of                      directors.

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After the initial term of each class, our directors will serve three-year terms. At each annual meeting of shareholders, a class of directors will be elected for a three-year term to succeed the directors of the same class whose terms are then expiring.

Our certificate of incorporation and bylaws further provide that, generally, vacancies or newly created directorships in our board may only be filled by the vote of a majority of our board provided that a quorum is present and any director so chosen will hold office until the next election of the class for which such director was chosen.

Nomination of Directors

Subject to certain exceptions, only persons nominated in accordance with our bylaws may be eligible for election as directors. Our bylaws provide that nominations may be made at any annual meeting of shareholders, or at any special meeting of shareholders called for the purpose of electing directors:

• by or at the discretion of our board of directors or a committee thereof; or

• by any of our shareholders of record at the time the notice is given, who shall be entitled to vote at the meeting and who complies with the notice procedures set forth herein.

For nominations to be properly brought before an annual meeting, or a special meeting called for the purpose of electing directors, by a shareholder, the shareholder must have given timely notice in writing to our secretary. To be timely, a shareholder’s notice must be received at our principal executive offices in the case of an annual meeting not less than 120 calendar days before the anniversary of the date our proxy statement was released to shareholders in connection with the previous year’s annual meeting; provided however, that if the date of the meeting is changed by more than 30 days from the date of the previous year’s meeting, notice must be received no later than the close of business on the 10th day following the earlier of the day on which notice of the date of the meeting was mailed to shareholders or public disclosure of that date was made. In the case of a special meeting called for the purpose of electing directors, to be timely, the shareholder’s notice must be received at our principal executive offices not later than the 10th day following the earlier of the day on which notice of the date of the meeting was mailed to shareholders or public disclosure of such date was made. The shareholder notice shall set forth:

• as to each person whom the shareholder proposes to nominate for election as a director: (a) the name, age, business address and residence address of such person, (b) the principal occupation or employment of such person, (c) the class or series and number of shares of the company that are owned beneficially or of record by such person and any affiliates or associates of such person, (d) the name of each nominee holder of shares owned beneficially but not of record and the number of such shares held by each such nominee, (e) whether and the extent to which any derivative instrument, swap, option or similar transaction was entered into by or on behalf of such person or any of its affiliates or associates, (f) whether and the extent to which any other agreement has been made by or on behalf of such person or any of its affiliates or associates to mitigate loss or manage risk of such person or to increase or decrease the voting power or other interest of such person, and (g) all other information that would be required to be disclosed by such shareholder or the beneficial owner, if any, on whose behalf the proposal is made in connection with solicitation of proxies for the election of directors in a contested election, pursuant to Regulation 14A of the Exchange Act;

• with respect to the shareholder giving notice or the beneficial owner, if any on whose behalf the proposal is made: (a) the name and address of such person, (b) the class or series and number of shares which are owned beneficially and of record by such person, (c) the name of each nominee holder of shares owned beneficially but not of record and the number of such shares held by each such nominee, (d) whether and the extent to which any derivative instrument, swap, option or similar transaction was entered into by or on behalf of such person or any of its affiliates or associates, (e) whether and the extent to which any other agreement has been made by or on behalf of such person or any of its

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affiliates or associates to mitigate loss or manage risk of such person or to increase or decrease the voting power or other interest of such person, (f) representation that the shareholder giving notice intends to appear in person or by proxy at the annual meeting, (g) a description of all agreements between the shareholder, the beneficial owner, if any, on whose behalf the proposal is made, or any of their respective affiliates or associates, in connection with the proposal of such business by such shareholder, and (h) all other information that would be required to be disclosed by such shareholder or the beneficial owner, if any, on whose behalf the proposal is made in connection with solicitation of proxies for the election of directors in a contested election, pursuant to Regulation 14A of the Exchange Act.

These provisions may impede shareholders’ ability to nominate persons for election as directors.

Oklahoma Law

Oklahoma Takeover Statute

We are subject to Section 1090.3 of the Oklahoma General Corporation Act. In general, Section 1090.3 prevents an “interested shareholder” from engaging in a “business combination” with an Oklahoma corporation for three years following the date that person became an interested shareholder, unless:

• prior to the date that person became an interested shareholder, our board of directors approved the transaction in which the interested shareholder became an interested shareholder or approved the business combination;

• upon consummation of the transaction that resulted in the interested shareholder becoming an interested shareholder, the interested shareholder owned at least 85 percent of our voting stock outstanding at the time the transaction commenced, excluding stock held by directors who are also officers of the corporation and stock held by certain employee stock plans; or

• on or subsequent to the date of the transaction in which that person became an interested shareholder, the business combination was approved by our board of directors and authorized at a meeting of shareholders by the affirmative vote of the holders of at least two-thirds of the outstanding voting stock of the corporation not owned by the interested shareholder.

Section 1090.3 defines a “business combination” to include:

• any merger or consolidation involving the corporation and an interested shareholder;

• any sale, transfer, pledge or other disposition involving an interested shareholder of 10 percent or more of the assets of the corporation;

• subject to limited exceptions, any transaction that results in the issuance or transfer by the corporation of the stock of the corporation to an interested shareholder;

• any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested shareholder; or

• the receipt by an interested shareholder of any loans, guarantees, pledges or other financial benefits provided by or through the corporation.

For purposes of the description above and Section 1090.3, the term “corporation” also includes our majority-owned subsidiaries. In addition, Section 1090.3, defines an “interested shareholder” as an entity or person beneficially owning 15 percent or more of our outstanding voting stock and any entity or person affiliated with or controlling or controlled by that entity or person.

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Oklahoma Control Share Provisions

Our certificate of incorporation provides that we are not subject to the control share provisions of the Oklahoma General Corporation Act. With exceptions, this act prevents holders of more than 20 percent of the voting power of the stock of an Oklahoma corporation from voting their shares. If we were to become subject to the control share provisions of the Oklahoma General Corporation Act in the future, this provision may delay the time it takes anyone to gain control of us.

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is Wells Fargo Bank, N.A.

Listing

We intend to file an application to list our shares of common stock on the NYSE. We expect that our shares will trade under the ticker symbol “OGS”. We have provided a confirmation to the NYSE that prior to trading as of the original listing date, we believe we will have:

• a closing price of at least $4 at the time of listing;

• at least 400 U.S. shareholders of 100 shares or more;

• at least 1,100,000 publicly held shares outstanding in the United States; and

• an aggregate market value of publicly held shares of at least $40 million in the United States.

Sale of Unregistered Securities

Upon our incorporation, we issued 100 shares of our common stock to ONEOK at a price of $0.01 per share for total consideration of $1.00 cash. We did not register the issuance under the Securities Act because it did not constitute a public offering and therefore was exempt from registration pursuant to Section 4(2) of the Securities Act.

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DESCRIPTION OF MATERIAL INDEBTEDNESS

Our Existing Debt

ONEOK uses a centralized cash management program that concentrates the cash assets of its operating divisions and subsidiaries in joint accounts for the purpose of providing financial flexibility and lowering the cost of borrowing, transaction costs and bank fees. The centralized cash management program provides that funds in excess of the daily needs of the operating divisions and subsidiaries are concentrated, consolidated or otherwise made available for use by other wholly owned entities of ONEOK. Under this cash management program, depending on whether a participating division or subsidiary has short-term cash requirements or cash surpluses, ONEOK provides cash to its respective divisions or subsidiaries or the divisions or subsidiaries provide cash to ONEOK. The amounts receivable, or due, under this program are due on demand. Activities under this program are reflected in our Balance Sheets included elsewhere in this information statement as short-term note payable to ONEOK.

Principal under this note payable bears interest based on ONEOK’s weighted-average cost of short-term debt, plus a utilization fee of 50 basis points, calculated monthly. The weighted-average interest rates for this note payable to ONEOK were 0.96 percent, 0.82 percent and 0.61 percent for 2012, 2011 and 2010, respectively. Changes in this note payable represent any funding required from ONEOK for working capital or capital expenditures and after giving effect to the distributions to ONEOK from our cash flows from operations.

We have a $1.1 billion long-term line of credit with ONEOK. The weighted-average interest rate on the amounts outstanding for the year was 6.43 percent, 6.87 percent and 6.92 percent in 2012, 2011 and 2010, respectively. The interest rate on the long-term line of credit is reset each year based on ONEOK’s outstanding debt plus an adjustment of 50 basis points for ONEOK’s cost to administer the program. The amount utilized by us on the long-term line of credit is adjusted annually with an offset to owner’s net investment to adjust debt-to-capital ratio to a level consistent with ONEOK’s debt-to-capital ratio. The outstanding principal under the long-term line of credit is due December 31, 2020, and no payments are required until maturity.

Immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all amounts outstanding under this note payable and long-term line of credit.

Our Debt Securities

In connection with the separation, we expect that we will receive approximately $1.19 billion of cash from the issuance of debt securities. We expect to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures.

The amount to be paid to ONEOK and the amount, type and term of the debt securities we will issue have not yet been determined, but will be determined prior to the separation. A number of factors could affect this final determination, and the amount of debt securities ultimately issued could be different from the amount disclosed in this Information Statement.

ONEOK has informed us that the approximately $1.13 billion cash proceeds it receives from us, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, will be used to repay outstanding ONEOK debt and/or repurchase ONEOK shares or pay dividends with respect to ONEOK shares, in each case within 18 months following the distribution.

Our Revolving Credit Facility

Additionally, we have entered into a $700 million revolving credit facility with Bank of America, N.A., as administrative agent, Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC and RBS Securities Inc., as joint lead arrangers and joint book managers, and the other lenders party thereto (the “Revolver

148

Facility”). Such Revolver Facility will become effective upon the satisfaction of customary conditions, including the consummation of the separation. We also expect to enter into a commercial paper program to support our working capital and general corporate needs and normal scope of business requirements after the separation. For more information on our planned financing arrangements, please see the sections entitled “ONE Gas, Inc.—Unaudited Pro Forma Financial Statements,” “Dividend Policy,” and “Management’s Discussion and Analysis of Results of Operations and Financial Condition.”

The Revolver Facility consists of a revolving credit facility in the amount of at least $700 million (available for revolving loans and up to $50 million of letters of credit) that may be borrowed in U.S. dollars. The Revolver Facility matures on the fifth-year anniversary of the separation. The Revolver Facility permits ONE Gas to increase commitments under the Revolver Facility to up to $1.2 billion in the aggregate, subject to the satisfaction of customary conditions, including receipt of additional commitments for the amount of such increase.

Interest is payable on the Revolver Facility at a rate equal to the LIBOR rate or a customary base rate, in each case, plus an applicable margin. ONE Gas is also required to pay a facility fee to the lenders on the actual daily amount of the commitments under the Revolver Facility (regardless of usage) and customary fees in respect of letters of credit.

ONE Gas may reduce the unutilized portion of the Revolver Facility in whole or in part without premium or penalty, subject to redeployment costs in the case of prepayment of LIBOR borrowings.

The Revolver Facility contains certain negative covenants (subject to exceptions, materiality thresholds and baskets) including, without limitation, negative covenants that limit the ability of the subsidiaries of ONE Gas to incur additional debt or enter into arrangements that restrict the ability to pay dividends or transfer property and negative covenants that limit the ability of ONE Gas and its subsidiaries to issue guarantees, grant liens on assets, make loans, acquisitions or other investments, engage in mergers or consolidations, sell substantially all of the assets of ONE Gas and its subsidiaries, engage in transactions with affiliates, change the nature of its business and use the proceeds of the Revolver Facility. The Revolver Facility also includes a financial maintenance covenant whereby ONE Gas must not exceed a maximum debt to total capital ratio of 70 percent as of the end of any calendar quarter.

Our Revolver Facility contains the following affirmative covenants, among others: delivery of financial statements, certificates and other information; delivery of notices of defaults, material litigation and other material events; payment of obligations; preservation of existence and rights; maintenance of material properties; maintenance of insurance; compliance with laws; maintenance of books and records; inspection rights; use of proceeds; and sanctions under the Patriot Act and similar laws and regulations.

The Revolver Facility contains events of default, including, without limitation (subject to customary grace periods and materiality thresholds) events of default upon (i) nonpayment of principal, interest or other amounts; (ii) violation of covenants; (iii) material incorrectness of representations and warranties; (iv) cross event of default for payment defaults, and cross acceleration for non-payment defaults, to other material indebtedness in excess of $100 million; (v) inability to pay debts as they become due and insolvency proceedings; (vi) material judgments; (vii) certain matters arising under pension laws; (viii) invalidity of loan documents; and (ix) the occurrence of a change of control. Upon the occurrence of certain events of default, the obligations under the Revolver Facility may be accelerated and the commitments may be terminated.

149

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement on Form 10 with the SEC with respect to the shares of our common stock that ONEOK shareholders will receive in the distribution. This Information Statement is a part of that registration statement and, as allowed by SEC rules, does not include all of the information you can find in the registration statement or the exhibits to the registration statement. For additional information relating to our company, the distribution and the separation, reference is made to the registration statement and the exhibits to the registration statement. Statements contained in this Information Statement as to the contents of any contract or document referred to are not necessarily complete and in each instance, if the contract or document is filed as an exhibit to the registration statement, we refer you to the copy of the contract or other document filed as an exhibit to the registration statement.

After the Form 10, of which this Information Statement is a part, is declared effective, we will file annual, quarterly and current reports, proxy statements and other information with the SEC. We intend to furnish our shareholders with annual reports containing consolidated financial statements audited by an independent registered public accounting firm. The registration statement is, and any of these future filings with the SEC will be, available to the public over the Internet on the SEC’s website at http://www.sec.gov. You may read and copy any filed document at the SEC’s public reference room in Washington, D.C. at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at 1 (800) SEC-0330 for further information about the public reference room.

We maintain an Internet site at http://www.                    .com. Our website and the information contained on that site, or connected to that site, are not incorporated into this Information Statement or the registration statement on Form 10 of which this Information Statement is a part.

As a result of the separation, we will be required to comply with the full informational requirements of the Exchange Act. We will fulfill those obligations with respect to these requirements by filing periodic reports and other information with the SEC.

We plan to make available, free of charge, on our Internet site our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, reports filed under Section 16 of the Exchange Act and amendments to those reports as soon as reasonably practicable after we electronically file or furnish those materials to the SEC.

150

GLOSSARY

The abbreviations, acronyms and industry terminology used in this Information Statement are defined as follows:

AVTS	Ad Valorem Tax Surcharge
Bcf	Billion cubic feet
Bcf/d	Billion cubic feet per day
CERCLA	Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended
CFTC	Commodities Futures Trading Commission
Clean Air Act	Federal Clean Air Act, as amended
Clean Water Act	Federal Water Pollution Control Act Amendments of 1972, as amended
Code	Internal Revenue Code of 1986, as amended
COG	Cost of gas
COGR	Cost of gas rider
COSA	Cost of service adjustment
DOT	United States Department of Transportation
Dth	Dekatherm
ECP	Equity Compensation Plan
EIA	Energy Information Administration
EPA	United States Environmental Protection Agency
EPS	Diluted earnings per share
Exchange Act	Securities Exchange Act of 1934, as amended
FERC	Federal Energy Regulatory Commission
GAAP	Accounting principles generally accepted in the United States of America
GRIP	Texas Gas Reliability Infrastructure Program
GSRS	Gas System Reliability Surcharge
IASB	International Accounting Standards Board
IFRS	International Financial Reporting Standards
IMP	Integrity Management Program
IRS	U.S. Internal Revenue Service
IRS Ruling	Private Letter Ruling from the IRS
KCC	Kansas Corporation Commission
LDCs	Local distribution companies
LIBOR	London Interbank Offered Rate
LTI Plan	Long-Term Incentive Plan
MMcf	Million cubic feet
Natural Gas Act	Natural Gas Act of 1938, as amended
NYSE	New York Stock Exchange
OCC	Oklahoma Corporation Commission
ONE Gas	ONE Gas, Inc.
ONEOK	ONEOK, Inc. and its subsidiaries
ONEOK Partners	ONEOK Partners, L.P. and its subsidiaries
OPEB	Other post-employment benefits
OSHA	Occupational Safety and Health Administration
PBRC	Performance-Based Rate Change
PHMSA	United States Department of Transportation Pipeline and Hazardous Materials Safety Administration
Pipeline Safety Improvement Act	Pipeline Safety Improvement Act of 2002, as amended
Pipeline Safety, Regulatory Certainty and Job Creation Act	Pipeline Safety, Regulatory Certainty and Job Creation Act of 2011, as amended

151

RICE NESHAP	National Emission Standards for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines
ROE	Return on equity calculated consistent with utility ratemaking in each jurisdiction
ROIC	Return on invested capital
RRC	Railroad Commission of Texas
SEC	Securities and Exchange Commission
Securities Act	Securities Act of 1933, as amended
SERP	Supplemental Executive Retirement Plan
Skadden	Skadden, Arps, Slate, Meagher & Flom LLP
TCM	Total Compensation Measurement
TSR	Total shareholder return
WNA	Weather-normalization adjustments

The statements in this Information Statement that are not historical information, including statements concerning plans and objectives of management for future operations, economic performance or related assumptions, are forward-looking statements. Forward-looking statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “should,” “goal,” “forecast,” “guidance,” “could,” “may,” “continue,” “might,” “potential,” “scheduled” and other words and terms of similar meaning. Although we believe that our expectations regarding future events are based on reasonable assumptions, we can give no assurance that such expectations and assumptions will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements are described under “Risk Factors,” and “Forward-Looking Statements,” in this Information Statement.

152

FINANCIAL STATEMENTS

INDEX TO FINANCIAL STATEMENTS

ONE Gas, Inc.	Page
Unaudited pro forma financial statements
Introduction	F-2
Pro Forma Statements of Income for the nine months ended September  30, 2013, and the year ended December 31, 2012 (unaudited)	F-4
Pro Forma Balance Sheet as of September 30, 2013 (unaudited)	F-5
Notes to Pro Forma Financial Statements (unaudited)	F-7
Audited historical balance sheet
Report of Independent Registered Public Accounting Firm	F-11
Balance Sheet as of September 30, 2013	F-12
Notes to Balance Sheet	F-13
ONE Gas Predecessor
Annual audited financial statements
Report of Independent Registered Public Accounting Firm	F-15
Statements of Income for the years ended December 31, 2012, 2011 and 2010	F-16
Balance Sheets as of December 31, 2012 and 2011	F-17
Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010	F-19
Statements of Changes in Owner’s Net Investment for the years ended December 31, 2012, 2011 and 2010	F-20
Notes to Financial Statements	F-21
Unaudited interim financial statements
Statements of Income for the nine months ended September 30, 2013 and 2012 (unaudited)	F-39
Balance Sheets as of September 30, 2013, and December 31, 2012 (unaudited)	F-40
Statements of Cash Flows for the nine months ended September 30, 2013 and 2012 (unaudited)	F-42
Statements of Changes in Owner’s Net Investment for the nine months ended September  30, 2013 and 2012 (unaudited)	F-43
Notes to Financial Statements (unaudited)	F-44

F-1

UNAUDITED PRO FORMA FINANCIAL STATEMENTS

Introduction—ONE Gas, Inc. is a wholly owned subsidiary of ONEOK. Following the separation, ONE Gas will be an independent, publicly traded company, and ONEOK will not retain any ownership interest in our company. The separation will occur through the following steps:

• the “reorganization,” which is ONEOK’s corporate reorganization in which ONEOK will transfer all of the assets and liabilities primarily related to its natural gas distribution business to ONE Gas. These assets and liabilities include accounts receivable and payable, natural gas in storage, regulatory assets and liabilities, pipeline and other natural gas distribution facilities, customer deposits, employee-related assets and liabilities including amounts attributable to pension and other postretirement benefits, tax-related assets and liabilities and other assets and liabilities primarily associated with providing natural gas distribution service in Oklahoma, Kansas and Texas. Cash and certain corporate assets, such as office space in the corporate headquarters and certain IT hardware and software, will not be transferred to ONE Gas; however, the Transition Services Agreement between ONEOK and ONE Gas will provide ONE Gas with access to such corporate assets as necessary to operate its business for a period of time to enable ONE Gas to obtain the applicable corporate assets.

As part of the reorganization, (1) immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all of the amounts outstanding on our short-term note payable to and long-term line of credit with ONEOK, (2) ONE Gas expects to issue approximately $1.2 billion of debt securities and receive approximately $1.19 billion of cash, and (3) ONE Gas expects to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, followed by

• the “distribution,” which is the distribution to ONEOK’s shareholders of all of the ONE Gas shares of common stock.

ONE Gas will not have any material assets or liabilities as a separate corporate entity until the contribution by ONEOK of the business described in the ONE Gas Information Statement in which these unaudited pro forma financial statements are included (the “Information Statement”). Following the contribution of these assets and liabilities, ONE Gas will operate the business as a stand-alone natural gas distribution company. Following the separation, ONEOK shareholders will directly own all of the shares of ONE Gas common stock.

Unaudited Pro Forma Financial Information—The following unaudited pro forma financial statements have been derived from the financial statements of the predecessor of ONE Gas, our predecessor for accounting purposes (“Predecessor”), included elsewhere in the Information Statement. Our Predecessor consists of the business attributable to ONEOK’s Natural Gas Distribution segment that will be transferred to us in connection with the separation. Although the legal transfer of ONEOK’s natural gas distribution businesses to us has yet to take place, for ease of reference, these unaudited pro forma financial statements include references to “we,” “us” or “our” that relate to our Predecessor. The contribution of the assets and liabilities of the natural gas distribution business will be recorded on a historical cost basis as the reorganization is among entities under common control.

While the historical financial statements reflect the past financial results of our Predecessor, these unaudited pro forma financial statements give effect to the separation of that business into an independent, publicly traded company. The pro forma adjustments to reflect the separation include:

• Reorganization adjustments—reflect the internal reorganization of ONEOK’s corporate structure by means of transfers of all of the assets and liabilities of the natural gas distribution business to us, and

• Distribution adjustment—represents the distribution of our common stock to the shareholders of ONEOK.

F-2

Adjustments related to the financing transactions associated with the reorganization have not been included in the pro forma financial statements as the amounts associated with such transactions will not be known until after the effectiveness of the registration statement.

The pro forma adjustments are based upon currently available information and certain estimates and assumptions; therefore, the actual adjustments that would have been made had the separation occurred on the dates described may have differed from the pro forma adjustments. However, management believes the adjustments provide a reasonable basis for presenting the significant effects of the transactions as contemplated, give appropriate effect to those assumptions and are properly applied in the unaudited pro forma financial statements.

The unaudited pro forma balance sheet as of September 30, 2013, gives effect to the separation as if it had occurred on September 30, 2013. The unaudited pro forma statements of income for the nine-month period ended September 30, 2013, and the year ended December 31, 2012, give effect to the separation described above as if it had occurred on January 1, 2012. The unaudited pro forma financial statements are for illustrative purposes only, and do not reflect what our financial position and results of operations would have been had the separation occurred on the dates indicated and are not necessarily indicative of our future financial position and future results of operations.

All significant pro forma adjustments and their underlying assumptions are described more fully in the notes to the unaudited pro forma financial statements which should be read in conjunction with such unaudited pro forma financial information, as well as in conjunction with our Predecessor’s historical financial statements and related notes thereto, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” which is included elsewhere in the Information Statement.

F-3

ONE Gas, Inc.

UNAUDITED PRO FORMA STATEMENTS OF INCOME

	Nine Months Ended September 30, 2013									Year Ended December 31, 2012
	Predecessor Historical			Pro Forma Adjustments			ONE Gas Pro Forma			Predecessor Historical			Pro Forma Adjustments			ONE Gas Pro Forma
	(Thousands of dollars, except per share amounts)
Revenues	$	1,167,266		$	—		$	1,167,266		$	1,376,649		$	—		$	1,376,649
Cost of natural gas		577,912			—			577,912			620,260			—			620,260
Net margin		589,354			—			589,354			756,389			—			756,389
Operating expenses
Operations and maintenance		292,275			—			292,275			363,120			—			363,120
Depreciation and amortization		100,118			—			100,118			130,150			—			130,150
General taxes		41,627			—			41,627			47,405			—			47,405
Total operating expenses		434,020			—			434,020			540,675			—			540,675
Operating income		155,334			—			155,334			215,714			—			215,714
Other income		3,909			—			3,909			3,664			—			3,664
Other expense		(1,980	)		—			(1,980	)		(2,225	)		—			(2,225	)
Interest expense		(45,702	)		—	(f)		(45,702	)		(60,793	)		—	(f)		(60,793	)
Income before income taxes		111,561			—			111,561			156,360			—			156,360
Income taxes		(42,684	)		—			(42,684	)		(59,851	)		—			(59,851	)
Net income	$	68,877		$	—		$	68,877		$	96,509		$	—		$	96,509
Pro forma income from continuing operations per share (Note 3):
Basic
Diluted
Weighted-average shares outstanding:
Basic
Diluted

See accompanying Notes to Unaudited Pro Forma Financial Statements.

F-4

ONE Gas, Inc.

UNAUDITED PRO FORMA BALANCE SHEET

September 30, 2013

	Predecessor Historical		Pro Forma Adjustments			ONE Gas Pro Forma
	(Thousands of dollars)
Assets
Property, plant and equipment
Property, plant and equipment	$	4,447,285	$	—		$	4,447,285
Accumulated depreciation and amortization		1,476,832		—			1,476,832
Net property, plant and equipment		2,970,453		—			2,970,453
Current assets
Cash		2,682		—	(f)		2,682
				—	(g)
Accounts receivable, net		124,418		—			124,418
Natural gas in storage		200,096		—			200,096
Regulatory assets		41,251		—			41,251
Other current assets		23,953		—			23,953
Total current assets		392,400		—			392,400
Goodwill and other assets
Regulatory assets		34,808		343,820	(a)		378,628
Goodwill		157,953		—			157,953
Other assets		16,474		16,667	(a)		33,141
				—	(f)
Total goodwill and other assets		209,235		360,487			569,722
Total assets	$	3,572,088	$	360,487		$	3,932,575

See accompanying Notes to Unaudited Pro Forma Financial Statements.

F-5

ONE Gas, Inc.

UNAUDITED PRO FORMA BALANCE SHEET

September 30, 2013

(Continued)

	Predecessor Historical		Pro Forma Adjustments			ONE Gas Pro Forma
	(Thousands of dollars)
Equity and liabilities
Equity and long-term debt
Equity
Common stock	$	—	$		(e)	$
Paid-in capital		—		1,295,063	(d)		1,295,063
Owner’s net investment		1,203,326		147,745	(a)		—
				(56,008	)(b)
				(1,295,063	)(d)
					(e)
				—	(g)
Accumulated other comprehensive loss		—		(2,860	)(a)		(2,860	)
Total equity		1,203,326		88,877			1,292,203
Long-term debt, excluding current maturities		1,319		—	(f)		1,319
Long-term line of credit with ONEOK		1,027,631		—	(b)		1,027,631
Total equity and long-term debt		2,232,276		88,877			2,321,153
Current liabilities
Current maturities of long-term debt		149		—			149
Short-term note payable to ONEOK		342,364		—	(b)		342,364
Affiliate payable		20,947		(20,947	)(c)		—
Accounts payable		75,072		20,947	(c)		96,019
Accrued taxes other than income		38,878		—			38,878
Customer deposits		55,857		—			55,857
Regulatory liabilities		23,237		—			23,237
Other current liabilities		15,677		681	(a)		16,358
Total current liabilities		572,181		681			572,862
Deferred credits and other liabilities
Deferred income taxes		697,291		90,700	(a)		843,999
				56,008	(b)
Regulatory liabilities		23,051		—			23,051
Other deferred credits		47,289		124,221	(a)		171,510
Total deferred credits and other liabilities		767,631		270,929			1,038,560
Commitments and contingencies
Total equity and liabilities	$	3,572,088	$	360,487		$	3,932,575

See accompanying Notes to Unaudited Pro Forma Financial Statements.

F-6

NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS

1. Basis of Presentation

Organization—ONE Gas, Inc. is a wholly owned subsidiary of ONEOK. Following the separation, ONE Gas will be an independent, publicly traded company, and ONEOK will not retain any ownership interest in our company. The historical financial data for ONE Gas has been derived from the financial statements of the predecessor of ONE Gas, our predecessor for accounting purposes (“Predecessor”). Although the legal transfer of ONEOK’s natural gas distribution businesses to us has yet to take place, for ease of reference, these unaudited pro forma financial statements include references to “we”, “us” or “our” that relate to our Predecessor. Our Predecessor consists of the business that ONEOK attributes to its natural gas distribution business which is located in Oklahoma, Kansas and Texas. The separation will occur through the following steps:

• the “reorganization,” which is ONEOK’s corporate reorganization in which ONEOK will transfer all of the assets and liabilities primarily related to its natural gas distribution business to ONE Gas. These assets and liabilities include accounts receivable and payable, natural gas in storage, regulatory assets and liabilities, pipeline and other natural gas distribution facilities, customer deposits, employee-related assets and liabilities including amounts attributable to pension and other postretirement benefits, general and income tax related assets and liabilities and other assets and liabilities primarily associated with providing natural gas distribution service in Oklahoma, Kansas and Texas. Cash and certain corporate assets, such as office space in the corporate headquarters and certain IT hardware and software, will not be transferred to ONE Gas; however, the Transition Services Agreement between ONEOK and ONE Gas will provide ONE Gas with access to such corporate assets as necessary to operate its business for a period of time to enable ONE Gas to obtain the applicable corporate assets.

• As part of the reorganization, (1) immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK will contribute to the capital of the natural gas distribution business all of the amounts outstanding on our short-term note payable to and long-term line of credit with ONEOK, (2) ONE Gas expects to issue approximately $1.2 billion of debt securities and receive approximately $1.19 billion of cash, and (3) ONE Gas expects to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures, followed by

• the “distribution,” which is the distribution to ONEOK’s shareholders of all of the ONE Gas shares of common stock.

ONE Gas will not have any material assets or liabilities as a separate corporate entity until the contribution to us by ONEOK of the business described in this Information Statement. Following the contribution of these assets and liabilities to us, ONE Gas will operate as a stand-alone natural gas distribution company.

The historical financial information is derived from the historical financial statements of our Predecessor set forth elsewhere in this Information Statement and is qualified in its entirety by reference to such historical financial statements and notes thereto. The pro forma adjustments have been prepared as if the transactions to be effected prior to or at the completion of the separation of us into an independent, publicly traded company had taken place on September 30, 2013, in the case of the unaudited pro forma balance sheet, and on January 1, 2012, in the case of the unaudited pro forma statements of income for the year ended December 31, 2012, and the nine months ended September 30, 2013. The pro forma income statement adjustments give effect to events that are directly attributable to the separation, are expected to have a continuing impact and are factually supportable. The pro forma balance sheet adjustments give effect to events that are directly attributable to the separation and factually supportable regardless of whether they have a continuing impact or are nonrecurring.

F-7

Nature of Operations—We provide natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas through our divisions Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service. We serve residential, commercial, industrial and transportation customers in all three states. In addition, the natural gas distribution companies serve wholesale and public authority customers.

We currently depend on ONEOK for a number of administrative functions. Historically, the cost of these functions have been allocated to us by ONEOK through a variety of methods, depending upon the nature of the expenses. ONE Gas expects to enter into a transition services agreement under which ONEOK will continue to provide to us, on an interim basis, various corporate support services. We expect to reimburse ONEOK for its costs of providing such services to us. Upon completion of our separation from ONEOK, we will incur additional expenses as a result of being a stand-alone public company. Under the terms of the Separation and Distribution Agreement, we will be responsible for all costs and expenses that we incur as a stand-alone company after the distribution. No pro forma adjustments have been made for anticipated additional expenses which are not factually supportable.

Prior to December 31, 2013, ONE Gas will have no employees. ONEOK will transfer employees to ONE Gas effective on January 1, 2014. The Employee Matters Agreement with ONEOK specifies which liabilities and related assets pertaining to employee benefit plans and postretirement benefit plans are allocable to ONE Gas. The amount of the assets and liabilities included in the pro forma adjustments have been estimated based upon the specific employees that will be transferred to ONE Gas. We do not expect any material changes to our estimate of the allocation of assets and liabilities related to employee benefit plans and postretirement benefit plans resulting from the actual employees that will be transferred on January 1. The final allocation of assets and liabilities to ONE Gas could be different (higher or lower) depending upon market conditions at the plans’ measurement dates. For more information regarding the allocation of employee-related expenses in the historical financial statements, see Note 2 of the Notes to Annual Audited Financial Statements of ONE Gas Predecessor.

2. Pro Forma Adjustments

Reorganization Adjustments

In accordance with the terms of the Separation and Distribution Agreement, ONEOK will contribute the assets and liabilities of its natural gas distribution business to us. These contributions will be recorded at historical cost as the reorganization is among entities under common control. Adjustments included in the unaudited pro forma financial statements related to the separation are as follows:

a. Reflects the allocation of pension and other postretirement benefits assets and liabilities (in thousands):

Regulatory assets—pension and other postretirement benefits	$	343,820
Supplemental executive retirement account assets		16,667
Pension and other postretirement obligations—current		(681	)
Pension and other postretirement obligations—noncurrent		(124,221	)
Deferred tax liability		(90,700	)
Accumulated other comprehensive loss		2,860
Net assets (liabilities) contributed	$	147,745

ONEOK has employee defined benefit retirement plans and other postretirement benefit plans that provide postretirement medical and life insurance benefits covering certain employees, which we refer to as “Shared Plans.” Pursuant to the Employee Matters Agreement with ONEOK, liabilities related to employee and retiree benefit plans generally will be assigned based on the individual’s last employment, so each individual who (1) retired from ONEOK while providing services to the natural gas distribution segment, (2) is currently associated with the natural gas distribution business, or (3) will be assigned to ONE Gas in connection with the separation will have his or her benefit plan liabilities assigned to ONE Gas.

F-8

Employee and retiree benefit liabilities relating to all other personnel not meeting one of the three criteria above generally will remain the liability of ONEOK. Assets in the benefit plans are expected to be assigned in accordance with the applicable rules and regulations associated with the division of a single plan into separate plans. ONE Gas will adopt and sponsor defined benefit retirement plans and other postretirement benefit plans that are generally consistent with the plans sponsored by ONEOK.

Regulatory authorities in our jurisdictions allow us to defer recognition of certain costs related to pension and other postretirement benefits and permit recovery of the amounts through rates over time, as opposed to expensing such costs as incurred. We believe it is probable that our regulators will continue to include the net periodic pension and other postretirement benefit costs in our regulated entities’ cost of service. Accordingly, we have reflected the minimum liability associated with the pro forma adjustment related to our pension and other postretirement benefit obligations that otherwise would have been recorded in accumulated other comprehensive income as a regulatory asset.

Actuarial Assumptions—The following table sets forth the weighted-average assumptions used to determine benefit obligations for pension and postretirement benefits:

Discount rate	5.25%
Compensation increase rate	3.45% - 3.50%

b. Reflects the elimination of intercompany balances with ONEOK as a contribution to our capital by ONEOK. Immediately prior to the contribution of the natural gas distribution business to ONE Gas, ONEOK expects to contribute to the capital of the natural gas distribution business all the amounts outstanding on our short-term note payable to and long-term line of credit with ONEOK. No pro forma adjustments have been made for the contribution to our capital of the amounts outstanding on our short-term note payable to and our long-term line of credit with ONEOK.

c. Reflects affiliate trade payable amounts with ONEOK in our historical financial statements reclassified as unaffiliated third party.

Distribution Adjustments

d. Represents the reclassification of the net investment by ONEOK to paid-in capital.

e. Represents the distribution of approximately                 million shares of our common stock at a par value of $0.01 per share to holders of ONEOK common stock.

Financing Transactions Not Reflected in the Pro Forma Financial Statements

f. We intend to issue approximately $1.2 billion of debt securities in connection with the separation. However, we do not expect to execute an agreement for the issuance of debt securities prior to effectiveness of the registration statement of which this information statement is a part. We expect to issue the debt securities sometime after effectiveness of the registration, but prior to the contribution of the natural gas distribution business to ONE Gas. Therefore, no pro forma adjustments have been made for the expected debt issuance or related interest expense.

We expect to issue fixed-rate debt securities, which we expect will result in the following amounts (in thousands):

Proceeds from issuance	$	1,200,000
Issuance costs		(9,150	)
Net proceeds from issuance	$	1,190,850

F-9

We estimate the expected debt issuance will have a weighted-average interest rate of 4.6 percent before issuance costs and fees. The estimated interest rate reflects an assumed investment grade credit rating and an approximate credit spread over the relevant benchmark rate based on consultation with our external financial advisers and market rates for similar debt instruments with ratings from recognized rating agencies similar to those we expect to receive for our debt securities. Our expected annual interest expense includes debt issuance cost amortization calculated using a method that approximates the effective interest method, as follows (in thousands):

Interest expense	$	55,440
Amortization of issuance costs		565
Less: interest capitalized		(1,295	)
Total interest expense	$	54,710

Actual interest expense we incur in future periods associated with the issuances of the debt securities may be higher or lower depending upon the final interest rates upon issuances. An increase in the interest rates by 12.5 basis points would increase interest expense by $1.5 million annually.

No borrowings under the revolving credit facility are assumed for any period presented. We expect to incur interest costs in future periods from short-term borrowings to support our working capital requirements and capital expenditures.

g. We expect to make a cash payment of approximately $1.13 billion to ONEOK, which represents the cash we will receive from the issuance of debt securities less the cash we will retain in order to maintain sufficient financial flexibility and to support our working capital requirements and capital expenditures. The amount of the cash payment is expected to be known after effectiveness of the registration statement. Therefore, no pro forma adjustment has been made.

3. Earnings per Share

The calculation of pro forma basic net income per share is calculated by dividing the pro forma net income by the weighted average number of shares of ONEOK common stock outstanding for the periods indicated, adjusted for an assumed distribution ratio of              shares of our common stock for each share of ONEOK common stock outstanding. The calculation of pro forma diluted net income per share is calculated by dividing the pro forma net income by the weighted average number of shares of ONEOK common stock outstanding and diluted shares of common stock outstanding for the periods indicated, adjusted for the same distribution ratio. This calculation may not be indicative of the dilutive effect that will actually result from share-based awards subsequently transferred to or granted by ONE Gas.

F-10

AUDITED HISTORICAL BALANCE SHEET

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholder of ONE Gas, Inc.:

In our opinion, the accompanying balance sheet presents fairly, in all material respects, the financial position of ONE Gas, Inc. at September 30, 2013, in conformity with accounting principles generally accepted in the United States of America. The balance sheet is the responsibility of the Company’s management. Our responsibility is to express an opinion on the balance sheet based on our audit. We conducted our audit of this statement in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the balance sheet, assessing the accounting principles used and significant estimates made by management, and evaluating the overall balance sheet presentation. We believe that our audit of the balance sheet provides a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Tulsa, Oklahoma

October 1, 2013

F-11

ONE Gas, Inc.

BALANCE SHEET

	September 30, 2013
Assets
Cash	$	1
Total assets	$	1
Equity
Common stock, $0.01 par value: authorized 1,000 shares; 100 shares issued and outstanding	$	1
Total equity	$	1

See accompanying Notes to Balance Sheet.

F-12

ONE Gas, Inc.

NOTES TO BALANCE SHEET

1. Description of Business

We were formed on August 30, 2013, as a wholly owned subsidiary of ONEOK, to hold ONEOK’s natural gas distribution business and to have our shares distributed to ONEOK’s shareholders. We have not incurred any income or expenses from our date of formation through September 30, 2013. Following our separation from ONEOK, we will be an independent, publicly traded company. ONEOK will not retain any ownership interest in our company. We will be the largest natural gas distributor in Oklahoma and Kansas and the third largest natural gas distributor in Texas, providing service as a regulated public utility to wholesale and retail customers. Our largest distribution markets will be Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita and Topeka, Kansas; and Austin and El Paso, Texas.

2. Events Subsequent to the Date of the Independent Auditor’s Report (Unaudited)

ONE Gas Credit Facility - On December 20, 2013, we entered into a $700 million revolving credit facility with Bank of America, N.A., as administrative agent, Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC and RBS Securities Inc., as joint lead arrangers and joint book managers, and the other lenders party thereto (the “Revolver Facility”). Such Revolver Facility will become effective upon the satisfaction of customary conditions, including the consummation of the separation.

The Revolver Facility consists of a revolving credit facility in the amount of at least $700 million (available for revolving loans and up to $50 million of letters of credit) that may be borrowed in U.S. dollars. The Revolver Facility matures on the fifth-year anniversary of the separation. The Revolver Facility permits ONE Gas to increase commitments under the Revolver Facility to up to $1.2 billion in the aggregate, subject to the satisfaction of customary conditions, including receipt of additional commitments for the amount of such increase.

Interest is payable on the Revolver Facility at a rate equal to the LIBOR rate or a customary base rate, in each case, plus an applicable margin. ONE Gas is also required to pay a facility fee to the lenders on the actual daily amount of the commitments under the Revolver Facility (regardless of usage) and customary fees in respect of letters of credit.

ONE Gas may reduce the unutilized portion of the Revolver Facility in whole or in part without premium or penalty, subject to redeployment costs in the case of prepayment of LIBOR borrowings.

The Revolver Facility contains certain negative covenants (subject to exceptions, materiality thresholds and baskets) including, without limitation, negative covenants that limit the ability of the subsidiaries of ONE Gas to incur additional debt or enter into arrangements that restrict the ability to pay dividends or transfer property and negative covenants that limit the ability of ONE Gas and its subsidiaries to issue guarantees, grant liens on assets, make loans, acquisitions or other investments, engage in mergers or consolidations, sell substantially all of the assets of ONE Gas and its subsidiaries, engage in transactions with affiliates, change the nature of its business and use the proceeds of the Revolver Facility. The Revolver Facility also includes a financial maintenance covenant whereby ONE Gas must not exceed a maximum debt to total capital ratio of 70 percent as of the end of any calendar quarter.

Our Revolver Facility contains the following affirmative covenants, among others: delivery of financial statements, certificates and other information; delivery of notices of defaults, material litigation and other material events; payment of obligations; preservation of existence and rights; maintenance of material properties; maintenance of insurance; compliance with laws; maintenance of books and records; inspection rights; use of proceeds; and sanctions under the Patriot Act and similar laws and regulations.

F-13

The Revolver Facility contains events of default, including, without limitation (subject to customary grace periods and materiality thresholds) events of default upon (i) nonpayment of principal, interest or other amounts; (ii) violation of covenants; (iii) material incorrectness of representations and warranties; (iv) cross event of default for payment defaults, and cross acceleration for non-payment defaults, to other material indebtedness in excess of $100 million; (v) inability to pay debts as they become due and insolvency proceedings; (vi) material judgments; (vii) certain matters arising under pension laws; (viii) invalidity of loan documents; and (ix) the occurrence of a change of control. Upon the occurrence of certain events of default, the obligations under the Revolver Facility may be accelerated and the commitments may be terminated.

Kansas Corporation Commission Settlement-In December 2013, the KCC approved a settlement agreement between ONEOK, the staff of the KCC, and the Citizens’ Utility Ratepayer Board for our separation from ONEOK. Among other things, the terms of the settlement agreement include the following:

• Kansas Gas Service shall not change its base rates prior to January 1, 2017. The time limitation on filing a general rate case to change base rates does not preclude Kansas Gas Service from changing rates or tariffs to recover appropriate costs under its current approved riders and tariffs, including its COGR, ACA, WNA, AVTS and GSRS tariffs;

• Kansas Gas Service will expense certain costs associated with ONEOK’s acquisition of Kansas Gas Service in 1997 that previously have been recorded as a regulatory asset and are being amortized and recovered in rates over a 40-year period. As such, ONE Gas Predecessor, our predecessor for accounting purposes, expects to record a noncash charge to income of approximately $10.2 million before taxes in the fourth quarter 2013;

• The level of pension and postretirement benefit costs used to calculate Kansas Gas Service’s Pension and Other Postretirement Benefit Trackers shall be adjusted to $13.6 million from $16.6 million with a corresponding reduction to revenues; and

• ONEOK agrees to make a one-time contribution to 501(c)(3) organizations of $1.2 million to provide financial assistance for weatherization of housing for low income natural gas customers of Kansas Gas Service.

The agreement authorizes the transfer of ONEOK’s existing Kansas natural gas distribution assets, certificates of convenience and necessity, franchises and tariffs to us conditioned upon the completion of the separation. Completion of the separation is subject to certain conditions, including final approval from the ONEOK Board of Directors.

F-14

ANNUAL AUDITED FINANCIAL STATEMENTS

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of ONEOK, Inc.:

We have audited the accompanying balance sheets of ONE Gas Predecessor as of December 31, 2012 and 2011, and the related statements of income, of changes in owner’s net investment and of cash flows for each of the three years in the period ended December 31, 2012. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ONE Gas Predecessor at December 31, 2012 and 2011, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America.

/s/ PricewaterhouseCoopers LLP

Tulsa, Oklahoma

October 1, 2013

F-15

ONE Gas Predecessor

STATEMENTS OF INCOME

	Years Ended December 31,
	2012			2011			2010
	(Thousands of dollars)
Revenues	$	1,376,649		$	1,621,334		$	1,817,402
Cost of natural gas, including affiliate		620,260			869,499			1,062,485
Net margin		756,389			751,835			754,917
Operating expenses
Operations and maintenance, including affiliate		363,120			373,511			354,414
Depreciation and amortization, including affiliate		130,150			132,212			130,968
General taxes		47,405			46,452			43,942
Total operating expenses		540,675			552,175			529,324
Operating income		215,714			199,660			225,593
Other income, including affiliate		3,664			140			4,037
Other expense, including affiliate		(2,225	)		(2,919	)		(3,804	)
Interest expense, including affiliate		(60,793	)		(54,119	)		(52,305	)
Income before income taxes		156,360			142,762			173,521
Income taxes		(59,851	)		(56,004	)		(67,099	)
Net income	$	96,509		$	86,758		$	106,422

See accompanying Notes to Financial Statements.

F-16

ONE Gas Predecessor

BALANCE SHEETS

	December 31, 2012		December 31, 2011
	(Thousands of dollars)
Assets
Property, plant and equipment
Property, plant and equipment	$	4,269,377	$	4,002,972
Accumulated depreciation and amortization		1,442,423		1,393,186
Net property, plant and equipment (Note 5)		2,826,954		2,609,786
Current assets
Cash		4,040		4,475
Accounts receivable, net		260,306		272,850
Natural gas in storage		102,989		133,143
Regulatory assets (Note 4)		68,719		29,830
Other current assets		21,040		24,192
Total current assets		457,094		464,490
Goodwill and other assets
Regulatory assets (Note 4)		38,178		43,763
Goodwill		157,953		157,953
Other assets		11,153		9,493
Total goodwill and other assets		207,284		211,209
Total assets	$	3,491,332	$	3,285,485

See accompanying Notes to Financial Statements.

F-17

ONE Gas Predecessor

BALANCE SHEETS

(Continued)

	December 31, 2012		December 31, 2011
	(Thousands of dollars)
Equity and liabilities
Equity and long-term debt
Owner’s net investment	$	1,154,797	$	1,158,355
Long-term debt, excluding current maturities		1,323		1,529
Long-term line of credit with ONEOK		1,027,631		912,396
Total equity and long-term debt		2,183,751		2,072,280
Current liabilities
Current maturities of long-term debt		206		330
Short-term note payable to ONEOK		294,109		235,417
Affiliate payable		21,087		25,884
Accounts payable		137,276		132,946
Accrued taxes other than income		29,977		29,803
Customer deposits		58,087		59,341
Other current liabilities		37,960		54,771
Total current liabilities		578,702		538,492
Deferred credits and other liabilities
Deferred income taxes		649,303		587,852
Other deferred credits		79,576		86,861
Total deferred credits and other liabilities		728,879		674,713
Commitments and contingencies (Note 9)
Total equity and liabilities	$	3,491,332	$	3,285,485

See accompanying Notes to Financial Statements.

F-18

ONE Gas Predecessor

STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2012			2011			2010
	(Thousands of dollars)
Operating activities
Net income	$	96,509		$	86,758		$	106,422
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		130,150			132,212			130,968
Deferred income taxes		59,491			87,184			35,601
Provision for doubtful accounts		2,528			2,741			3,451
Changes in assets and liabilities:
Accounts receivable		10,016			(18,216	)		74,375
Natural gas in storage		30,154			2,025			(35,490	)
Asset removal costs		(47,658	)		(35,438	)		(29,134	)
Affiliate payable		(7,229	)		(683	)		(9,513	)
Accounts payable		(3,950	)		(11,300	)		(60,769	)
Accrued taxes other than income		174			1,399			(297	)
Customer deposits		(1,254	)		(826	)		1,014
Regulatory assets and liabilities		(59,338	)		(33,804	)		34,616
Other assets and liabilities		(13,006	)		(19,262	)		(17,804	)
Cash provided by operating activities		196,587			192,790			233,440
Investing activities
Capital expenditures		(272,014	)		(240,996	)		(217,927	)
Proceeds from sale of assets		1,462			195			423
Cash used in investing activities		(270,552	)		(240,801	)		(217,504	)
Financing activities
Increase in short-term note payable to ONEOK, net		58,692			74,975			16,366
Borrowings on long-term line of credit with ONEOK		115,235			155,974			21,050
Repayment of long-term debt		(330	)		(305	)		(284	)
Distributions to ONEOK		(100,067	)		(180,158	)		(54,773	)
Cash provided by (used in) financing activities		73,530			50,486			(17,641	)
Change in cash and cash equivalents		(435	)		2,475			(1,705	)
Cash and cash equivalents at beginning of period		4,475			2,000			3,705
Cash and cash equivalents at end of period	$	4,040		$	4,475		$	2,000
Supplemental cash flow information:
Cash paid for interest, net of amounts capitalized	$	60,793		$	54,119		$	52,305
Cash paid to (received from) ONEOK for income taxes	$	360		$	(31,180	)	$	31,498

See accompanying Notes to Financial Statements.

F-19

ONE Gas Predecessor

STATEMENTS OF CHANGES IN OWNER’S NET INVESTMENT

	Owner’s Net Investment
	(Thousands of dollars)
January 1, 2010	$	1,200,106
Net income		106,422
Distributions to ONEOK		(54,773	)
December 31, 2010		1,251,755
Net income		86,758
Distributions to ONEOK		(180,158	)
December 31, 2011		1,158,355
Net income		96,509
Distributions to ONEOK		(100,067	)
December 31, 2012	$	1,154,797

See accompanying Notes to Financial Statements.

F-20

ONE Gas Predecessor

NOTES TO FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Nature of Operations—ONE Gas, Inc. is a wholly owned subsidiary of ONEOK. On July 25, 2013, ONEOK announced that its Board of Directors unanimously authorized ONEOK’s management to pursue a plan to separate its natural gas distribution business into a stand-alone publicly traded company through the contribution of the natural gas distribution business to ONE Gas and the distribution of ONE Gas shares to shareholders of ONEOK. Following the separation, ONE Gas will be an independent, publicly traded company, and ONEOK will not retain any ownership interest in the company. We will consist of the business that ONEOK attributes to its natural gas distribution business, which is located in Oklahoma, Kansas and Texas.

We provide natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas through our divisions, Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively. We serve residential, commercial, industrial and transportation customers in all three states. In addition, these natural gas distribution companies serve wholesale and public authority customers.

Basis of Presentation—These financial statements have been derived from ONEOK’s financial statements, which include the natural gas distribution business as if ONE Gas Predecessor, the predecessor of ONE Gas, Inc. for accounting purposes (“Predecessor”), had been a separate company for all periods presented. As the natural gas distribution business is comprised of divisions of ONEOK, these financial statements are presented as carved out from the financial statements of ONEOK. Although the legal transfer of ONEOK’s natural gas distribution businesses to ONE Gas has yet to take place, for ease of reference, these financial statements include references to “we,” “us” or “our” that relate to the Predecessor. The assets and liabilities in the financial statements have been reflected on a historical basis, as prior to the separation all of the assets and liabilities presented are wholly owned by ONEOK and are being transferred within the ONEOK consolidated group. The financial statements also include expense allocations for certain corporate functions historically performed by ONEOK, including allocations of general corporate expenses related to executive oversight, accounting, treasury, tax, legal and information technology. We believe our assumptions underlying the financial statements, including the assumptions regarding the allocation of general corporate expenses from ONEOK, are reasonable. However, the financial statements may not include all of the actual expenses that would have been incurred by us and may not reflect our results of operations, financial position and cash flows had we been a separate publicly traded company during the periods presented.

Because the operations of the distribution business within ONEOK are conducted through separate divisions, ONEOK’s net investment in us, excluding the short-term note payable and long-term line of credit with ONEOK, is shown as owner’s net investment in lieu of stockholder’s equity in the financial statements. Transactions between ONEOK and us which are not part of the long-term line of credit or the short-term note payable with ONEOK have been identified in the Statements of Changes in Owner’s Net Investment as distributions to ONEOK. Transactions with ONEOK’s other operating businesses, which generally settle monthly, are shown as accounts receivable-affiliate or accounts payable-affiliate. See Note 2 for additional information on our transactions with ONEOK and its affiliates.

The financial statements include the accounts of the natural gas distribution business as set forth in “Organization and Nature of Operations” and “Basis of Presentation” above. All significant intracompany balances and transactions have been eliminated.

Use of Estimates—The preparation of our financial statements and related disclosures in accordance with GAAP requires us to make estimates and assumptions with respect to values or conditions that cannot be known with certainty that affect the reported amount of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements. These estimates and assumptions also affect the reported amounts of revenue and expenses during the reporting period. Items that may be estimated include, but are not limited to, the economic useful life of assets, fair value of assets and liabilities, provisions for doubtful accounts

F-21

receivable, unbilled revenues for natural gas delivered but for which meters have not been read, natural gas purchased but for which no invoice has been received, provision for income taxes, including any deferred tax valuation allowances, the results of litigation and various other recorded or disclosed amounts.

We evaluate these estimates on an ongoing basis using historical experience and other methods we consider reasonable based on the particular circumstances. Nevertheless, actual results may differ significantly from the estimates. Any effects on our financial position or results of operations from revisions to these estimates are recorded in the period when the facts that give rise to the revision become known.

Fair Value Measurements—We define fair value as the price that would be received from the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date. We use the market and income approaches to determine the fair value of our assets and liabilities and consider the markets in which the transactions are executed. We measure the fair value of a group of financial assets and liabilities consistent with how a market participant would price the net risk exposure at the measurement date.

Fair Value Hierarchy—At each balance sheet date, we utilize a fair value hierarchy to classify fair value amounts recognized or disclosed in our financial statements based on the observability of inputs used to estimate such fair value. The levels of the hierarchy are described below:

• Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities;

• Level 2—Significant observable pricing inputs other than quoted prices included within Level 1 that are, either directly or indirectly, observable as of the reporting date. Essentially, this represents inputs that are derived principally from or corroborated by observable market data; and

• Level 3—May include one or more unobservable inputs that are significant in establishing a fair value estimate. These unobservable inputs are developed based on the best information available and may include our own internal data.

We recognize transfers into and out of the levels as of the end of each reporting period.

Determining the appropriate classification of our fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. We categorize derivatives for which fair value is determined using multiple inputs within a single level, based on the lowest level input that is significant to the fair value measurement in its entirety. See Note 3 for additional disclosures of our fair value measurements.

Cash and Cash Equivalents—We currently participate in the ONEOK cash management program rather than maintaining significant cash equivalent balances. Amounts due to ONEOK resulting from the cash management program are recorded as a short-term note payable to ONEOK. See Note 2 for additional information on the cash management program.

Revenue Recognition—For regulated deliveries of natural gas, we read meters and bill customers on a monthly cycle. We recognize revenues upon the delivery of the natural gas commodity or services rendered to customers. Revenues are accrued for natural gas delivered and services rendered to customers, but not yet billed, based on estimates from the last meter reading date to month end (accrued unbilled revenue). The billing cycles for customers do not necessarily coincide with the accounting periods used for financial reporting purposes.

Accounts Receivable—Accounts receivable represent valid claims against nonaffiliated customers for natural gas sold or services rendered, net of allowances for doubtful accounts. We accrue unbilled revenues for natural gas that has been delivered but not yet billed at the end of an accounting period. Accrued unbilled revenue is based on a percentage estimate of amounts unbilled each month, which is dependent upon a number of factors, some of which require management’s judgment. These factors include customer consumption patterns and the impact of weather on usage. The amounts of accrued unbilled natural gas sales revenues at December 31, 2012 and 2011, were $127.1 million and $136.2 million, respectively.

F-22

We assess the creditworthiness of our customers. Those customers who do not meet minimum standards are required to provide security, including deposits and other forms of collateral, when appropriate. With more than 2 million customers across three states, we are not exposed materially to a concentration of credit risk. We maintain an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends, consideration of the current credit environment and other information. In most jurisdictions, we are able to recover natural gas costs related to doubtful accounts through purchased-gas cost adjustment mechanisms. At December 31, 2012 and 2011, our allowance for doubtful accounts was $2.7 million and $3.1 million, respectively.

Inventories—Natural gas in storage is maintained on the basis of weighted-average cost. Natural gas inventories that are injected into storage are recorded in inventory based on actual purchase costs, including transportation. Natural gas inventories that are withdrawn from storage are accounted for in our purchased-gas cost adjustment mechanisms at the weighted-average inventory cost. The regulatory treatment of natural gas inventories provides for cost recovery in customer rates.

Materials and supplies inventories, which are included in other current assets on our Balance Sheets, are stated at the lower of weighted-average cost or net realizable value. Our materials and supplies inventories totaled $18.3 million and $21.3 million at December 31, 2012 and 2011, respectively.

Derivatives and Risk Management Activities—We record all derivative instruments at fair value, with the exception of normal purchases and normal sales that are expected to result in physical delivery. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, if so, the reason for holding it, or if regulatory rulings require a different accounting treatment.

If certain conditions are met, we may elect to designate a derivative instrument as a hedge of exposure to changes in fair values or cash flows.

The table below summarizes the various ways in which we account for our derivative instruments and the impact on our financial statements:

	Recognition and Measurement
Accounting Treatment	Balance Sheet	Income Statement
Normal purchases and normal sales	—Fair value not recorded	—Changein fair value not recognized in earnings
Mark-to-market	—Recorded at fair value	—Changein fair value recognized in, and recoverable through, the purchased-gas cost adjustments mechanisms

Gains or losses associated with the fair value of commodity derivative instruments entered into by us are included in, and recoverable through, the purchased-gas cost adjustment mechanisms.

See Note 3 for more discussion of our fair value measurements and hedging activities using derivatives.

Property, Plant and Equipment—Our properties are stated at cost, which includes direct construction costs such as direct labor, materials, burden and AFUDC. Generally, the cost of our property retired or sold, plus removal costs, less salvage, is charged to accumulated depreciation. Gains and losses from sales or retirement of an entire operating unit or system of our properties are recognized in income. Maintenance and repairs are charged directly to expense.

F-23

The interest portion of AFUDC represents the cost of borrowed funds used to finance construction activities. We capitalize interest costs during the construction or upgrade of qualifying assets. Capitalized interest is recorded as a reduction to interest expense.

Our properties are depreciated using the straight-line method over their estimated useful lives. Generally, we apply composite depreciation rates to functional groups of property having similar economic circumstances. We periodically conduct depreciation studies to assess the economic lives of our assets. These depreciation studies are completed as a part of our rate proceedings, and the changes in economic lives, if applicable, are implemented prospectively when the new rates are effective. Changes in the estimated economic lives of our property, plant and equipment could have a material effect on our financial position or results of operations.

Property, plant and equipment on our Balance Sheets includes construction work in process for capital projects that have not yet been placed in service and therefore are not being depreciated. Assets are transferred out of construction work in process when they are substantially complete and ready for their intended use.

See Note 5 for disclosures of our property, plant and equipment.

Impairment of Goodwill and Long-Lived Assets—We assess our goodwill for impairment at least annually as of July 1. Total goodwill was $158.0 million at December 31, 2012 and 2011, respectively. Our goodwill impairment analysis performed as of July 1, 2012 utilized a qualitative assessment and did not result in an impairment charge nor did our analysis reflect any risk of impairment. Subsequent to that date, no event has occurred indicating that the implied fair value is less than the carrying value of our net assets. There were no impairment charges resulting from our 2011 or 2010 annual impairment tests, which were based on the comparison of our estimated fair value to our book value. A decline of 10 percent in our estimated fair value would not have resulted in an impairment charge.

As part of our goodwill impairment test, we first assess qualitative factors (including macroeconomic conditions, industry and market considerations, cost factors and overall financial performance) to determine whether it is more likely than not that our fair value is less than our carrying amount. If further testing is necessary, we perform a two-step impairment test for goodwill. In the first step, an initial assessment is made by comparing our fair value with our book value, including goodwill. If the fair value is less than the book value, an impairment is indicated, and we must perform a second test to measure the amount of the impairment. In the second test, we calculate the implied fair value of the goodwill by deducting the fair value of all tangible and intangible net assets from the fair value determined in step one of the assessment. If the carrying value of the goodwill exceeds the implied fair value of the goodwill, we will record an impairment charge.

To estimate our fair value, we use two generally accepted valuation approaches, an income approach and a market approach, using assumptions consistent with a market participant’s perspective. Under the income approach, we use anticipated cash flows over a period of years plus a terminal value and discount these amounts to their present value using appropriate discount rates. Under the market approach, we apply acquisition multiples to forecasted cash flows. The acquisition multiples used are consistent with historical asset transactions. The forecasted cash flows are based on average forecasted cash flows over a period of years.

We assess our long-lived assets for impairment whenever events or changes in circumstances indicate that an asset’s carrying amount may not be recoverable. An impairment is indicated if the carrying amount of a long-lived asset exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposition of the asset. If an impairment is indicated, we record an impairment loss equal to the difference between the carrying value and the fair value of the long-lived asset. We determined that there were no asset impairments in 2012, 2011 or 2010.

Regulation—We are subject to the rate regulation and accounting requirements of the OCC, KCC, RRC and various municipalities in Texas. We follow the accounting and reporting guidance for regulated operations. During the rate-making process, regulatory authorities set the framework for what we can charge customers for

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our services and establish the manner that our costs are accounted for, including allowing us to defer recognition of certain costs and permitting recovery of the amounts through rates over time, as opposed to expensing such costs as incurred. Examples include interim capital investment mechanisms such as GSRS and GRIP; interim rate adjustment mechanisms such as PBRC and cost of service adjustments, weather normalization, unrecovered purchased-gas costs, pension and post-employment benefit costs and ad valorem taxes. This allows us to stabilize rates over time rather than passing such costs on to the customer for immediate recovery. Actions by regulatory authorities could have an effect on the amount recovered from rate payers. Any difference in the amount recoverable and the amount deferred is recorded as income or expense at the time of the regulatory action. A write-off of regulatory assets and costs not recovered may be required if all or a portion of the regulated operations have rates that are no longer:

• established by independent, third-party regulators;

• designed to recover the specific entity’s costs of providing regulated services; and

• set at levels that will recover our costs when considering the demand and competition for our services.

See Note 4 for our regulatory asset and liability disclosures.

Pension and Postretirement Employee Benefits—Certain benefit costs associated with employees who directly support our operations are determined based on a specific employee basis. We are also allocated benefit costs associated with employees of ONEOK that provide general corporate services. These amounts are charged to us by ONEOK as described in Note 2. See Note 7 for additional information regarding pension and postretirement employee benefit plans.

For the periods presented, we were not the plan sponsor for these benefit plans. Accordingly, our Balance Sheets do not reflect any assets or liabilities related to these benefit plans.

Income Taxes—Our operations are included in the consolidated federal and state income tax returns of ONEOK. Our income tax provision has been calculated on a separate return basis. Accordingly, we have recognized deferred tax assets and liabilities for the difference between the financial statement and income tax basis of assets and liabilities and carry-forward items, based on income tax laws and rates existing at the time the temporary differences are expected to reverse as if we were a corporation for federal and state income tax purposes. In addition, ONEOK manages its tax position based upon the tax attributes of the consolidated group. Certain attributes may not be available to us if we were operating as an independent company.

The effect on deferred taxes of a change in tax rates is deferred and amortized for operations regulated by the OCC, KCC, RRC and various municipalities in Texas, if, as a result of an action by a regulator, it is probable that the effect of the change in tax rates will be recovered from or returned to customers through future rates. We continue to amortize previously deferred investment tax credits for ratemaking purposes over the periods prescribed by the OCC, KCC, RRC and various municipalities in Texas.

A valuation allowance for deferred tax assets is recognized when it is more likely than not that some or all of the benefit from the deferred tax asset will not be realized. To assess that likelihood, we use estimates and judgment regarding our future taxable income, as well as the jurisdiction in which such taxable income is generated, to determine whether a valuation allowance is required. Such evidence can include our current financial position, our results of operations, both actual and forecasted, the reversal of deferred tax liabilities, as well as the current and forecasted business economics of our industry. We had no valuation allowance at December 31, 2012 and 2011.

We utilize a more-likely-than-not recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position that is taken or expected to be taken in a tax return. We reflect penalties and interest as part of income tax expense as they become applicable for tax provisions that do not meet the more-likely-than-not recognition threshold and measurement attribute. There were no material uncertain tax positions at December 31, 2012 and 2011.

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See Note 8 for additional discussion of income taxes.

Asset Retirement Obligations—Asset retirement obligations represent legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or normal use of the asset. Certain long-lived assets that comprise our natural gas distribution systems, primarily our pipeline assets, are subject to agreements or regulations that give rise to an asset retirement obligation for removal or other disposition costs associated with retiring the assets in place upon the discontinued use of the natural gas distribution system. We recognize the fair value of a liability for an asset retirement obligation in the period when it is incurred if a reasonable estimate of the fair value can be made. We are not able to estimate reasonably the fair value of the asset retirement obligations for portions of our assets because the settlement dates are indeterminable given our expected continued use of the assets with proper maintenance. We expect our natural gas distribution systems will continue in operation as long as natural gas supply and demand for natural gas distribution service exists. Based on the widespread use of natural gas for heating and cooking activities by residential and commercial customers in our service areas, management expects supply and demand to exist for the foreseeable future.

In accordance with long-standing regulatory treatment, we collect through rates the estimated costs of removal on certain regulated properties through depreciation expense, with a corresponding credit to accumulated depreciation and amortization. These removal costs collected through our rates include costs attributable to legal and nonlegal removal obligations; however, the amounts collected that are in excess of these nonlegal asset-removal costs incurred are accounted for as a regulatory liability for financial reporting purposes. Historically, with the exception of the regulatory authority in Kansas, the regulatory authorities that have jurisdiction over our regulated operations have not required us to quantify or disclose this amount; rather, these costs are addressed prospectively in depreciation rates and are set in each general rate order. We have made an estimate of our regulatory liability using current rates since the last general rate order in each of our jurisdictions; however, for financial reporting purposes, significant uncertainty exists regarding the future disposition of this regulatory liability, pending, among other issues, clarification of regulatory intent. We continue to monitor the regulatory requirements, and the liability may be adjusted as more information is obtained. We record the estimated asset removal obligation in noncurrent liabilities in other deferred credits on our Balance Sheets. To the extent this estimated liability is adjusted, such amounts will be reclassified between accumulated depreciation and amortization and other deferred credits and therefore will not have an impact on earnings.

Contingencies—Our accounting for contingencies covers a variety of business activities, including contingencies for legal and environmental exposures. We accrue these contingencies when our assessments indicate that it is probable that a liability has been incurred or an asset will not be recovered and an amount can be estimated reasonably. We expense legal fees as incurred and base our legal liability estimates on currently available facts and our estimates of the ultimate outcome or resolution. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than the completion of a remediation feasibility study. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. Actual results may differ from our estimates resulting in an impact, positive or negative, on earnings. See Note 9 for additional discussion of contingencies.

Share-Based Payments—Certain employees providing direct service to us participate in ONEOK’s share-based awards plans. The plans provide for ONEOK common-stock-based awards to both employees and ONEOK’s nonmanagement directors. The plans permit the granting of various types of awards including, but not limited to, performance units and restricted stock units. Awards may be granted for no consideration other than prior and future services or based on certain financial performance targets.

ONEOK charges us for compensation expense related to stock-based compensation awards granted to our employees that directly support our operations. Share-based compensation is also a component of allocated amounts charged to us by ONEOK for general and administrative personnel providing services on our behalf.

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Earnings per Common Share—Historical earnings per share are not presented because we did not have common stock that was part of our capital structure for the periods presented.

Segments—We operate in one business segment: regulated public utilities that deliver natural gas to residential, commercial, industrial and transportation customers. We define business segments as components of an organization for which discrete financial information is available and operating results are evaluated on a regular basis by the chief operating decision maker (“CODM”) in order to assess performance and allocate resources. Our CODM is ONEOK’s Chief Executive Officer (CEO). Characteristics of our organization which were relied upon in making this determination include the similar nature of services we provide, the functional alignment of our organizational structure, and the reports that are regularly reviewed by the CODM for the purpose of assessing performance and allocating resources. Our management is functionally aligned and centralized, with performance evaluated based upon results of the entire distribution business. Capital allocation decisions are driven by integrity management and operating efficiency, not geographic location.

We evaluate performance based principally on operating income. Affiliate sales are recorded on the same basis as sales to unaffiliated customers and are discussed in further detail in Note 2. Net margin is comprised of total revenues less cost of natural gas. Cost of natural gas includes commodity purchases, fuel, storage and transportation costs and does not include an allocation of general operating costs or depreciation and amortization.

In 2012, 2011 and 2010, we had no single external customer from which we received 10 percent or more of our gross revenues.

2. RELATED-PARTY TRANSACTIONS

Affiliate Transactions—We have certain transactions with ONEOK and its subsidiaries. We purchase a portion of our natural gas supply and natural gas transportation and storage services from ONEOK and its affiliates. These contracts are awarded through a competitive-bidding process, and the costs are recoverable through our purchased-gas cost mechanisms.

The Statements of Income include expense allocations for certain corporate functions historically performed by ONEOK and allocated to its natural gas distribution business, including allocations of general corporate expenses related to executive oversight, accounting, treasury, tax, legal, information technology and facilities maintenance. Where costs are incurred specifically on our behalf, the costs are billed directly to us by ONEOK. In other situations, the costs may be allocated to us through a variety of methods, depending upon the nature of the expenses. For example, a service that applies equally to all employees of ONEOK is allocated based upon the number of employees in each ONEOK affiliate. An expense benefiting the company but having no direct basis for allocation is allocated by the modified Distrigas method, a method using a combination of ratios that include gross plant and investment, operating income and payroll expense. It is not practicable to determine what these general overhead costs would be on a stand-alone basis. These allocations include the following costs:

Corporate Services—Represents costs for certain employees of ONEOK who provide general and administrative services on our behalf. These charges are either directly identifiable or allocated based upon usage factors for our operations. In addition, we receive other allocated costs for our share of general corporate expenses of ONEOK, which are determined based on our relative use of the service or, if there is no direct basis for allocation, are allocated by the modified Distrigas method. All of these costs are reflected in operations and maintenance and depreciation expense in the Statements of Income.

Benefit Plans and Incentives—Represents benefit costs and other incentives, including group health and welfare benefits, pension plans, postretirement benefit plans and employee stock-based compensation plans. Costs associated with incentive and stock-based compensation plans are determined on a specific identification basis for certain employees that directly support our operations. All other employee benefit costs historically have been allocated using a percentage factor derived from a ratio of benefit costs to salary costs for ONEOK’s employees. These expenses are included in operations and maintenance expenses in the Statements of Income.

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Total compensation cost, which includes costs for both employees that directly support our operations and allocations for corporate services, charged to us by ONEOK related to share-based payment plans was $12.4 million, $22.6 million and $9.4 million during 2012, 2011 and 2010, respectively. See Note 6 for additional information regarding share-based payments. Total cost charged to us by ONEOK related to pension and postretirement health and life insurance plans was $43.4 million, $40.3 million and $37.6 million during 2012, 2011 and 2010, respectively, which is net of amounts deferred through regulatory mechanisms of $4.1 million, $3.7 million and $2.2 million during 2012, 2011 and 2010, respectively. See Note 7 for additional information regarding employee benefit plans.

Interest Expense—ONEOK utilizes a centralized approach to cash management and the financing of its businesses. Cash receipts and cash expenditures for costs and expenses from our operations are transferred to or from ONEOK on a regular basis and recorded as increases or decreases in the balance due in short-term note payable to ONEOK under unsecured promissory notes we have in place with ONEOK. The amounts outstanding under the long-term line of credit with ONEOK and the short-term note payable to ONEOK accrue interest based on ONEOK’s weighted-average cost of debt and such interest was added monthly to the note principal.

The following table shows ONEOK’s and its subsidiaries’ transactions with us included in the Statements of Income for the periods indicated:

	Years Ended December 31,
	2012			2011		2010
	(Thousands of dollars)
Cost of natural gas	$	135,650		$	203,585	$	326,632
Operations and maintenance
Direct employee labor and benefit costs		165,798			178,151		154,614
Allocated employee labor and benefit costs		24,994			25,452		22,776
Charges for general and administrative services		24,059			28,266		23,321
Depreciation and amortization		6,033			6,444		6,641
Other (income)/expense, net		(2,668	)		1,419		(2,191	)
Interest expense		60,305			53,357		51,460
Total	$	414,171		$	496,674	$	583,253

Employee labor and benefit costs capitalized totaled $46.1 million, $43.0 million and $40.9 million for 2012, 2011 and 2010 respectively. In addition, we recorded regulated utility revenue from ONEOK and its subsidiaries. These amounts were immaterial for all periods presented.

Cash Management—ONEOK uses a centralized cash management program that concentrates the cash assets of its operating divisions and subsidiaries in joint accounts for the purpose of providing financial flexibility and lowering the cost of borrowing, transaction costs and bank fees. The centralized cash management program provides that funds in excess of the daily needs of the operating divisions and subsidiaries are concentrated, consolidated or otherwise made available for use by other wholly owned entities of ONEOK. Under this cash management program, depending on whether a participating division or subsidiary has short-term cash requirements or cash surpluses, ONEOK provides cash to its respective divisions or subsidiaries or the divisions or subsidiaries provide cash to ONEOK. The amounts receivable, or due, under this program are due on demand. Activities under this program are reflected in the Balance Sheets as short-term note payable to ONEOK.

Principal under this note payable bears interest based on ONEOK’s weighted-average cost of short-term debt, plus a utilization fee of 50 basis points, calculated monthly. The weighted-average interest rates for this note payable were 0.96 percent, 0.82 percent and 0.61 percent for 2012, 2011 and 2010, respectively. Changes in this note payable represent any funding required from ONEOK for working capital or capital expenditures and after giving effect to the transfers to ONEOK from our cash flows from operations.

Affiliate receivables were not material as of December 31, 2012 and 2011, and are included in accounts receivable on our Balance Sheets.

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Long-Term Line of Credit with ONEOK—We have a $1.1 billion long-term line of credit with ONEOK. The weighted-average interest rate on the amounts outstanding for the year was 6.43 percent, 6.87 percent and 6.92 percent in 2012, 2011 and 2010, respectively. The interest rate on the revolver is reset each year based on ONEOK’s outstanding debt plus an adjustment of 50 basis points for ONEOK’s cost to administer the program. The amount utilized on the long-term line of credit is adjusted annually with an offset to owner’s net investment to adjust our debt-to-capital ratio to a level consistent with ONEOK’s debt-to-capital ratio. The outstanding principal under the long-term line of credit is due December 31, 2020, and no payments are required until maturity.

3. DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

Derivative Instruments—We held purchased natural gas call options with fair values of $7.7 million and $9.9 million at December 31, 2012 and 2011, respectively. The premiums paid are recorded in current regulatory assets as these contracts are included in, and recoverable through, the purchased-gas cost adjustment mechanisms. We recorded losses of $5.9 million, $14.5 million and $25.5 million for the years ended December 31, 2012, 2011 and 2010, respectively, which are deferred as part of our unrecovered purchased-gas costs in current regulatory assets or other current liabilities in our Balance Sheets. Our natural gas call options are classified as Level 1 as fair value amounts are based on unadjusted quoted prices in active markets including NYMEX-settled prices. There were no transfers between levels for the years ended December 31, 2012, 2011 and 2010.

All of our natural gas derivative financial contracts are with our affiliate ONEOK Energy Services Company, a subsidiary of ONEOK. ONEOK Energy Services Company entered into similar natural gas derivative financial contracts with third parties at our direction and on our behalf. ONEOK announced an accelerated wind down of ONEOK Energy Services Company operations that is expected to be substantially completed by April 2014. We expect to enter into natural gas derivative financial contracts with unaffiliated third parties following the separation.

Other Financial Instruments—The approximate fair value of cash and cash equivalents, accounts receivable and accounts payable is equal to book value, due to the short-term nature of these items. Our cash and cash equivalents are comprised of bank and money market accounts and are classified as Level 1.

Debt payable to ONEOK includes short-term note payable and a long-term line of credit as discussed in Note 2. The short-term note payable to ONEOK is due upon demand and, therefore, the carrying amount approximates fair value and is classified as Level 1. The estimated fair value of our long-term line of credit with ONEOK was $1.3 billion and $1.2 billion at December 31, 2012 and 2011, respectively. The book value of our long-term line of credit with ONEOK was $1.0 billion and $0.9 billion at December 31, 2012 and 2011, respectively. The long-term line of credit was valued using the income approach by discounting the future payments. Significant inputs include the discount rate, which we estimated using a rate at which we could have borrowed at each measurement date. All inputs to this calculation are Level 3.

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4. REGULATORY ASSETS AND LIABILITIES

The table below presents a summary of regulatory assets, net of amortization, and liabilities for the periods indicated:

		December 31, 2012
	Remaining Recovery Period	Current			Noncurrent			Total
		(Thousands of dollars)
Under-recovered purchased-gas costs	1 year	$	29,170		$	—		$	29,170
Weather normalization	1 year		18,978			—			18,978
Pension and postretirement benefit costs	5 to 20 years		992			11,354			12,346
Reacquired debt costs	15 years		811			11,353			12,164
Transition costs	25 years		442			10,610			11,052
Recoupable take-or-pay	10 to 20 years		6,911			622			7,533
Ad valorem tax	1 year		7,038			—			7,038
Other	1 to 26 years		4,377			4,239			8,616
Total regulatory assets, net of amortization			68,719			38,178			106,897
Accumulated removal costs	up to 50 years		—			(29,526	)		(29,526	)
Over-recovered purchased-gas costs	1 year		(9,584	)		—			(9,584	)
Total regulatory liabilities			(9,584)			(29,526)			(39,110)
Net regulatory assets and liabilities		$	59,135		$	8,652		$	67,787
		December 31, 2011
	Remaining Recovery Period	Current			Noncurrent			Total
		(Thousands of dollars)
Under-recovered purchased-gas costs	1 year	$	9,827		$	—		$	9,827
Pension and postretirement benefit costs	5 to 20 years		2,842			9,874			12,716
Reacquired debt costs	16 years		815			12,164			12,979
Transition costs	26 years		443			11,052			11,495
Recoupable take-or-pay	10 to 20 years		6,804			7,533			14,337
Ad valorem tax	1 year		6,642			—			6,642
Other	1 to 27 years		2,457			3,140			5,597
Total regulatory assets, net of amortization			29,830			43,763			73,593
Accumulated removal costs	up to 50 years		—			(34,390	)		(34,390	)
Over-recovered purchased-gas costs	1 year		(17,312	)		—			(17,312	)
Total regulatory liabilities			(17,312)			(34,390)			(51,702)
Net regulatory assets and liabilities		$	12,518		$	9,373		$	21,891

Regulatory assets on our Balance Sheets, as authorized by the various regulatory commissions, are probable of recovery. Base rates are designed to provide a recovery of cost during the period rates are in effect but do not generally provide for a return on investment for amounts we have deferred as regulatory assets. The recoupable take-or-pay regulatory assets earn a return on investment. No other regulatory assets provide for a return on investment. All of our regulatory assets recoverable through base rates are subject to review by the respective regulatory commissions during future rate proceedings. We are not aware of any evidence that these costs will not be recoverable through either rate riders or base rates, and we believe that we will be able to recover such costs, consistent with our historical recoveries.

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The OCC has authorized Oklahoma Natural Gas’ recovery of the recoupable take-or-pay settlement, and pension and postretirement benefit costs over a 10 to 20 year period. The KCC has authorized Kansas Gas Service’s recovery of pension and postretirement benefit costs over a period of 5 years.

Unrecovered purchased-gas costs represents the costs that have been over- or under-recovered from customers through the purchased-gas cost adjustment mechanisms and include natural gas utilized in our operations.

We amortize reacquired debt costs in accordance with the accounting guidelines prescribed by the OCC and KCC.

The KCC has allowed certain transition costs associated with ONEOK’s acquisition of Kansas Gas Service in 1997 to be amortized and recovered in rates over a 40-year period with no rate of return on the unrecovered balance.

Weather normalization represents revenue over- or under-recovered through the weather normalization adjustment rider in Kansas. This amount is deferred as a regulatory asset for a 12-month period. Kansas Gas Service then applies an adjustment to the customers’ bills for 12 months to refund the over-collected revenue or bill the under-collected revenue.

Ad valorem tax represents an increase in Kansas Gas Service’s taxes above the amount approved in a rate case. Kansas law permits a utility to file a tariff to recover additional ad valorem tax expense incurred above the amount currently recovered in the cost of service rate. This excess amount is recoverable through a surcharge and can be recovered, provided the utility reports the change in rates to the KCC, on an annual basis.

Recovery through rates resulted in amortization of regulatory assets of approximately $18.3 million, $26.0 million and $31.0 million for the years ended December 31, 2012, 2011 and 2010, respectively.

We collect through our rates the estimated costs of removal on certain regulated properties through depreciation expense, with a corresponding credit to accumulated depreciation and amortization. These removal costs are nonlegal obligations; however, the amounts collected that are in excess of these nonlegal asset-removal costs incurred are accounted for as a regulatory liability. We have made an estimate of our regulatory liability using current rates since the last general rate order in each of our jurisdictions. We record the estimated nonlegal asset removal obligation in noncurrent liabilities in other deferred credits on our Balance Sheets.

5. PROPERTY, PLANT AND EQUIPMENT

The following table sets forth our property, plant and equipment by property type, for the periods indicated:

	December 31, 2012			December 31, 2011
	(Thousands of dollars)
Natural gas distribution pipelines and related equipment	$	3,512,660		$	3,309,876
Natural gas transmission pipelines and related equipment		402,030			367,464
General plant and other		304,346			287,564
Construction work in process		50,341			38,068
Property, plant and equipment		4,269,377			4,002,972
Accumulated depreciation and amortization		(1,442,423	)		(1,393,186	)
Net property, plant and equipment	$	2,826,954		$	2,609,786

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The average depreciation rates for our property are set forth in the following table for the periods indicated:

Years Ended December 31,
2012	2011	2010
2.0% - 3.0%	2.0% - 2.9%	2.1% - 2.8%

We recorded capitalized interest of $1.3 million, $1.7 million and $1.1 million for the years ended December 31, 2012, 2011 and 2010, respectively. We incurred liabilities for construction work in process that had not been paid at December 31, 2012, 2011 and 2010 of $12.0 million, $3.7 million and $2.1 million, respectively. Such amounts are not included in capital expenditures on the Statements of Cash Flows.

6. SHARE-BASED PAYMENTS

Certain employees that directly support our operations participate in the ECP and the LTI Plan, which provide for the granting of stock-based compensation. We are charged by ONEOK for share-based compensation expense related to employees that directly support our operations. ONEOK also charges us for the allocated costs of certain employees of ONEOK (including stock-based compensation) who provide general and administrative services on our behalf. Information included in this note is limited to share-based compensation associated with employees that directly support our operations. See Note 2 for total costs charged to us by ONEOK.

Compensation cost charged to us for employees that directly support our operations for ONEOK’s share-based payment plans was $4.8 million, $10.9 million and $3.5 million for 2012, 2011 and 2010, respectively, which is net of $3.0 million, $7.1 million and $2.2 million of tax benefits, respectively. Compensation costs capitalized for employees that directly support our operations associated with ONEOK’s share-based payment plans were not material for 2012 and 2010 and totaled $2.2 million in 2011.

Restricted Stock Units—ONEOK has granted restricted stock units to key employees that vest over a three-year period and entitle the grantee to receive shares of its common stock. Restricted stock unit awards are measured at fair value as if they were vested and issued on the grant date, reduced by expected dividend payments and adjusted for estimated forfeitures. No dividends were paid prior to vesting on the restricted stock units granted prior to 2013. Beginning in 2013, restricted stock unit awards granted will accrue dividend equivalents prior to vesting. Compensation expense is recognized on a straight-line basis over the vesting period of the award. For all awards outstanding, a forfeiture rate of 3 percent based on historical forfeitures under ONEOK’s share-based payment plans was used.

Performance-Unit Awards—ONEOK has granted performance-unit awards to key employees. The shares of its common stock underlying the performance units vest at the expiration of a three-year period if certain performance criteria are met by ONEOK as determined by the Executive Compensation Committee of the ONEOK Board of Directors. Upon vesting, a holder of performance units is entitled to receive a number of shares of common stock equal to a percentage (0 percent to 200 percent) of the performance units granted, based on ONEOK’s total shareholder return over the vesting period, compared with the total shareholder return of a peer group of other energy companies over the same period. Compensation expense is recognized on a straight-line basis over the period of the award.

If paid, the outstanding performance-unit awards entitle the grantee to receive the grant in shares of ONEOK common stock. The outstanding performance-unit awards are equity awards with a market-based condition, which results in the compensation cost for these awards being recognized over the requisite service period, provided that the requisite service period is fulfilled, regardless of when, if ever, the market condition is satisfied. The fair value of these performance units was estimated on the grant date based on a Monte Carlo model. For all awards outstanding, a forfeiture rate of 3 percent based on historical forfeitures under ONEOK’s share-based payment plans was used. No dividends were paid prior to vesting on performance stock units granted prior to 2013. Beginning in 2013, performance stock unit awards granted will accrue dividend equivalents prior to vesting. The compensation expense on these awards will only be adjusted for changes in forfeitures.

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Restricted Stock Unit Activity

As of December 31, 2012, there was $2.2 million of total unrecognized compensation cost related to the nonvested restricted stock unit awards of employees that directly support our operations, which is expected to be recognized over a weighted-average period of 1.7 years. The following tables set forth activity and various statistics for the restricted stock unit awards:

	Number of Shares			Weighted- Average Price
Nonvested December 31, 2011		177,625		$	22.46
Granted		56,300		$	36.60
Released to participants		(21,962	)	$	14.99
Forfeited		(6,663	)	$	30.03
Nonvested December 31, 2012		205,300		$	26.89

	2012		2011		2010
Weighted-average grant date fair value (per share)	$	36.60	$	28.50	$	18.67
Fair value of shares granted (thousands of dollars)	$	2,046	$	2,310	$	1,609

Performance-Unit Activity

As of December 31, 2012, there was $4.6 million of total unrecognized compensation cost related to the nonvested performance-unit awards of employees that directly support our operations, which is expected to be recognized over a weighted-average period of 1.7 years. The following tables set forth activity and various statistics related to the performance-unit awards and the assumptions used in the valuations of the 2012, 2011 and 2010 grants at the grant date:

	Number of Units			Weighted- Average Price
Nonvested December 31, 2011		457,256		$	23.62
Granted		101,100		$	42.39
Released to participants		(181,408	)	$	14.67
Forfeited		(13,074	)	$	34.67
Nonvested December 31, 2012		363,874		$	32.90

	2012			2011			2010
Volatility (a)		27.00	%		39.91	%		40.60	%
Dividend yield		2.86	%		3.30	%		4.12	%
Risk-free interest rate		0.38	%		1.33	%		1.47	%
(a) —Volatility was based on historical volatility over three years using daily stock price observations.
	2012			2011			2010
Weighted-average grant date fair value (per share)	$	42.39		$	34.68		$	24.05
Fair value of shares granted (thousands of dollars)	$	4,286		$	5,026		$	3,381

Employee Stock Purchase Plan

Certain employees that directly support our operations participate in the ONEOK, Inc. Employee Stock Purchase Plan (the ESPP). Subject to certain exclusions, all full-time ONEOK employees are eligible to participate in the ESPP. Employees can choose to have up to 10 percent of their annual base pay withheld to purchase ONEOK’s

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common stock, subject to terms and limitations of the plan. ONEOK’s Executive Compensation Committee may allow contributions to be made by other means, provided that in no event will contributions from all means exceed 10 percent of the employee’s annual base pay. The purchase price of the stock is 85 percent of the lower of the average market price of ONEOK’s common stock on the grant date or exercise date. Compensation cost, before taxes, charged to us for employees that directly support our operations reflects $0.8 million, $3.2 million and $1.8 million for 2012, 2011 and 2010, respectively, for the ESPP.

Employee Stock Award Program

Certain employees that directly support our operations participate in ONEOK’s Employee Stock Award Program. Under the program, each time the per-share closing price of ONEOK common stock on the NYSE closed for the first time at or above each $1.00 increment above its previous historical high closing price, ONEOK issued, for no monetary consideration, one share of its common stock to all eligible employees. Compensation cost, before taxes, charged to us for employees that directly support our operations reflects $1.2 million and $9.8 million for 2012 and 2011, respectively, related to the Employee Stock Award Plan. For 2010, the compensation expense under this program was not material.

7. EMPLOYEE BENEFIT PLANS

Certain ONEOK employees participate in defined benefit pension plans and postretirement health and life insurance plans (Shared Plans) sponsored by ONEOK, which include participants who are employees that directly support our operations. We account for such Shared Plans as multi-employer benefit plans. Accordingly, we do not record an asset or liability to recognize the funded status of the Shared Plans. We recognize a liability only for any required contributions to the Shared Plans that are accrued and unpaid at the balance sheet date. The related pension and postretirement expenses are allocated to us based on plan participants who are employees that directly support our operations. These pension and postretirement benefit costs include amounts associated with vested participants who are no longer employees. As described in Note 2, ONEOK also charges us for the allocated cost of certain employees of ONEOK who provide general and administrative services on our behalf. ONEOK includes an allocation of the benefit costs associated with these ONEOK employees based upon its allocation methodology, not necessarily specific to the employees providing general and administrative services on our behalf. As a result, the information described below is limited to amounts associated with the employees directly supporting our operations.

Shared Retirement and Postretirement Benefit Plans

Shared Retirement Plans—ONEOK has a defined benefit pension plan covering nonbargaining-unit employees hired before January 1, 2005, and certain bargaining-unit employees hired before December 15, 2011. Nonbargaining unit employees hired after December 31, 2004; employees represented by Local No. 304 of the International Brotherhood of Electrical Workers (IBEW) hired on or after July 1, 2010; employees represented by the United Steelworkers hired on or after December 15, 2011; and employees who accepted a one-time opportunity to opt out of ONEOK’s pension plan are covered by a profit-sharing plan. Certain employees of the Texas Gas Services division of ONEOK are entitled to benefits under a frozen cash-balance pension plan. In addition, ONEOK has a supplemental executive retirement plan for the benefit of certain officers. No new participants in the supplemental executive retirement plan have been approved since 2005. ONEOK funds its pension costs at a level needed to maintain or exceed the minimum funding levels required by the Employee Retirement Income Security Act of 1974, as amended, and the Pension Protection Act of 2006. Pension expense charged to us for employees directly supporting our operations by ONEOK for 2012, 2011 and 2010 totaled $22.8 million, $18.9 million and $15.4 million, respectively.

Shared Postretirement Benefit Plans—ONEOK sponsors health and welfare plans that provide postretirement medical and life insurance benefits to certain employees who retire with at least five years of service. The postretirement medical plan is contributory based on hire date, age and years of service, with retiree contributions

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adjusted periodically, and contains other cost-sharing features such as deductibles and coinsurance. Other postretirement benefit expense charged to us for employees directly supporting our operations by ONEOK for 2012, 2011 and 2010 totaled $16.6 million, $17.2 million and $18.2 million, respectively.

Actuarial Assumptions—The following table sets forth the weighted-average assumptions used by ONEOK to determine the periodic benefit costs for the periods indicated:

	Years Ended December 31,
	2012	2011	2010
Discount rate	5.00%	5.50%	6.00%
Expected long-term return on plan assets	8.25%	8.25%	8.50%
Compensation increase rate	3.20% - 3.80%	3.30% - 3.90%	3.1% - 4.0%

Regulatory Treatment—The OCC, KCC and regulatory authorities in Texas have approved the recovery of pension costs and postretirement benefits costs through rates for Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively. The costs recovered through rates are based on current funding requirements and the net periodic benefit cost for pension and postretirement costs. Differences, if any, between the expense and the amount recovered through rates would be reflected in earnings, net of authorized deferrals.

We historically have recovered pension and postretirement benefit costs through rates. We believe it is probable that regulators will continue to include the net periodic pension and postretirement benefit costs in our cost of service.

Other Employee Benefit Plans

Thrift Plan—ONEOK has a Thrift Plan covering all full-time employees, and employee contributions are discretionary. ONEOK matches 100 percent of each participant’s eligible contribution up to 6 percent of each participant’s eligible compensation, subject to certain limits. Compensation expense charged to us for employees that directly support our operations by ONEOK totaled $8.4 million, $8.5 million and $7.9 million in 2012, 2011 and 2010, respectively for ONEOK’s matching contributions to this plan.

Profit-Sharing Plan—ONEOK has a profit-sharing plan for all nonbargaining unit employees hired after December 31, 2004, and employees covered by the IBEW collective bargaining agreement hired after June 30, 2010. Nonbargaining unit employees who were employed prior to January 1, 2005, and employees covered by the IBEW collective bargaining agreement employed prior to July 1, 2010, were given a one-time opportunity to make an irrevocable election to participate in the profit-sharing plan and not accrue any additional benefits under ONEOK’s defined benefit pension plan after December 31, 2004, and June 30, 2010, respectively. Employees covered by the United Steelworker collective bargaining agreement employed prior to December 16, 2011, were given a one-time opportunity to make an irrevocable election to participate in the profit-sharing plan. ONEOK plans to make a contribution to the profit-sharing plan each quarter equal to 1 percent of each participant’s eligible compensation during the quarter. Additional discretionary employer contributions may be made at the end of each year. Employee contributions are not allowed under the plan. Compensation expense associated with ONEOK’s contributions made to the plan for employees who directly support our operations were $2.1 million, $2.1 million and $1.4 million in 2012, 2011 and 2010, respectively.

Employee Deferred Compensation Plan—The ONEOK, Inc. 2005 Nonqualified Deferred Compensation Plan provides select employees, as approved by our Board of Directors, with the option to defer portions of their compensation and provides nonqualified deferred compensation benefits that are not available due to limitations on employer and employee contributions to qualified defined contribution plans under the federal tax laws. Contributions made to the plan for employees who directly support our operations were not material in 2012, 2011 and 2010.

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8. INCOME TAXES

The following table sets forth our provision for income taxes for the periods indicated:

	Years Ended December 31,
	2012		2011			2010
	(Thousands of dollars)
Current income tax provision (benefit)
Federal	$	—	$	(27,093	)	$	27,093
State		360		(4,087	)		4,405
Total current income tax provision (benefit)		360		(31,180	)		31,498
Deferred income tax provision
Federal		51,481		75,304			30,632
State		8,010		11,880			4,969
Total deferred income tax provision		59,491		87,184			35,601
Total provision for income taxes	$	59,851	$	56,004		$	67,099

The following table is a reconciliation of our income tax provision for the periods indicated:

	Years Ended December 31,
	2012			2011			2010
	(Thousands of dollars)
Income before income taxes	$	156,360		$	142,762		$	173,521
Federal statutory income tax rate		35	%		35	%		35	%
Provision for federal income taxes		54,726			49,967			60,732
State income taxes, net of federal tax benefit		5,423			4,278			5,900
Other, net		(298	)		1,759			467
Income tax provision	$	59,851		$	56,004		$	67,099

The following table sets forth the tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and liabilities for the periods indicated:

	December 31, 2012		December 31, 2011
	(Thousands of dollars)
Deferred tax assets
Net operating loss	$	51,623	$	38,787
Other		1,521		9,895
Total deferred tax assets		53,144		48,682
Deferred tax liabilities
Excess of tax over book depreciation		690,776		629,625
Purchased-gas cost adjustment		6,513		3,432
Other regulatory assets and liabilities, net		8,684		8,350
Total deferred tax liabilities		705,973		641,407
Net deferred tax liabilities	$	652,829	$	592,725

We had no income taxes payable or receivable at December 31, 2012 and 2011. We do not make cash payments directly to taxing jurisdictions; rather, our share of ONEOK’s tax payments or refunds received are reflected as changes in short-term note payable to ONEOK.

The net operating losses begin expiring in 2031. The company, or its affiliates, expect to utilize all of the net operating losses prior to their expiration dates.

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9. COMMITMENTS AND CONTINGENCIES

Commitments—Operating leases represent future minimum lease payments under noncancelable leases covering office space, equipment and vehicles. Rental expense in 2012, 2011 and 2010 was not material. The following table sets forth our operating lease payments for the periods indicated:

Operating Leases
(Millions of dollars)
2013	$	2.5
2014		1.7
2015		1.5
2016		1.4
2017		1.3
Thereafter		4.5
Total	$	12.9

Environmental Matters—We are subject to multiple historical, wildlife preservation and environmental laws and/or regulations, that affect many aspects of our present and future operations. Regulated activities include but are not limited to those involving air emissions, storm water and wastewater discharges, handling and disposal of solid and hazardous wastes, wetland preservation, hazardous materials transportation, and pipeline and facility construction. These laws and regulations require us to obtain and/or comply with a wide variety of environmental clearances, registrations, licenses, permits and other approvals. Failure to comply with these laws, regulations, licenses and permits may expose us to fines, penalties and/or interruptions in our operations that could be material to our results of operations. In addition, emission controls and/or other regulatory or permitting mandates under the Clean Air Act and other similar federal and state laws could require unexpected capital expenditures. We cannot assure that existing environmental statutes and regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional statutes or regulations that result in increased compliance costs or additional operating restrictions could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We own or retain legal responsibility for the environmental conditions at 12 former manufactured natural gas sites in Kansas. These sites contain potentially harmful materials that are subject to control or remediation under various environmental laws and regulations. A consent agreement with the KDHE governs all work at these sites. The terms of the consent agreement allow us to investigate these sites and set remediation activities based upon the results of the investigations and risk analysis. Remediation involves typically the management of contaminated soils and may involve removal of structures and monitoring and/or remediation of groundwater.

Of the 12 sites, we have begun soil remediation on 11 sites. Regulatory closure has been achieved at three locations, and we have completed or are near completion of soil remediation at eight sites. We have begun site assessment at the remaining site where no active remediation has occurred.

Our expenditures for environmental evaluation, mitigation, remediation and compliance to date have not been significant in relation to our financial position, results of operations or cash flows, and our expenditures related to environmental matters had no material effects on earnings or cash flows during 2012, 2011 or 2010. We do not expect to incur material expenditures for these matters in the future.

The EPA’s rule on air-quality standards titled “National Emission Standards for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines,” also known as RICE NESHAP, included a compliance date in October 2013. We do not expect expenditures required to comply with this rule to have a material impact on our results of operations, financial position or cash flows.

Pipeline Safety—We are subject to PHMSA regulations, including integrity-management regulations. The Pipeline Safety Improvement Act of 2002 requires pipeline companies operating high-pressure pipelines to

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perform integrity assessments on pipeline segments that pass through densely populated areas or near specifically designated high-consequence areas. In January 2012, The Pipeline Safety, Regulatory Certainty and Job Creation Act of 2011 was signed into law. The law increased maximum penalties for violating federal pipeline safety regulations and directs the DOT and Secretary of Transportation to conduct further review or studies on issues that may or may not be material to us. These issues include but are not limited to the following:

• an evaluation on whether natural gas pipeline integrity-management requirements should be expanded beyond current high-consequence areas;

• a verification of records for pipelines in class 3 and 4 locations and high-consequence areas to confirm maximum allowable operating pressures; and

• a requirement to test previously untested pipelines operating above 30 percent yield strength in high-consequence areas.

The potential capital and operating expenditures related to this legislation, the associated regulations or other new pipeline safety regulations are unknown.

Legal Proceedings—We are a party to various litigation matters and claims that have arisen in the normal course of our operations. While the results of litigation and claims cannot be predicted with certainty, we believe the reasonably possible losses from such matters, individually and in the aggregate, are not material. Additionally, we believe the probable final outcome of such matters will not have a material adverse effect on our results of operations, financial position or cash flows.

10. Events Subsequent to the Date of the Independent Auditor’s Report (Unaudited)

In December 2013, the KCC approved a settlement agreement between ONEOK, the staff of the KCC, and the Citizens’ Utility Ratepayer Board for our separation from ONEOK. Among other things, the terms of the settlement agreement include the following:

• Kansas Gas Service shall not change its base rates prior to January 1, 2017. The time limitation on filing a general rate case to change base rates does not preclude Kansas Gas Service from changing rates or tariffs to recover appropriate costs under its current approved riders and tariffs, including its COGR, ACA, WNA, AVTS and GSRS tariffs;

• Kansas Gas Service will expense certain costs associated with ONEOK’s acquisition of Kansas Gas Service in 1997 that previously have been recorded as a regulatory asset and are being amortized and recovered in rates over a 40-year period. As such, we expect to record a noncash charge to income of approximately $10.2 million before taxes in the fourth quarter 2013;

• The level of pension and postretirement benefit costs used to calculate Kansas Gas Service’s Pension and Other Postretirement Benefit Trackers shall be adjusted to $13.6 million from $16.6 million with a corresponding reduction to revenues; and

• ONEOK agrees to make a one-time contribution to 501(c)(3) organizations of $1.2 million to provide financial assistance for weatherization of housing for low income natural gas customers of Kansas Gas Service.

The agreement authorizes the transfer of ONEOK’s existing Kansas natural gas distribution assets, certificates of convenience and necessity, franchises and tariffs to us conditioned upon the completion of the separation. Completion of the separation is subject to certain conditions, including final approval from the ONEOK Board of Directors.

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UNAUDITED INTERIM FINANCIAL STATEMENTS

ONE Gas Predecessor

STATEMENTS OF INCOME

	Nine Months Ended September 30,
(Unaudited)	2013			2012
	(Thousands of dollars)
Revenues	$	1,167,266		$	943,879
Cost of natural gas, including affiliate		577,912			398,056
Net margin		589,354			545,823
Operating expenses
Operations and maintenance, including affiliate		292,275			274,848
Depreciation and amortization, including affiliate		100,118			97,481
General taxes		41,627			35,986
Total operating expenses		434,020			408,315
Operating income		155,334			137,508
Other income, including affiliate		3,909			3,239
Other expense, including affiliate		(1,980	)		(1,821	)
Interest expense, including affiliate		(45,702	)		(45,317	)
Income before income taxes		111,561			93,609
Income taxes		(42,684	)		(35,742	)
Net income	$	68,877		$	57,867

See accompanying Notes to Financial Statements.

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ONE Gas Predecessor

BALANCE SHEETS

(Unaudited)	September 30, 2013		December 31, 2012
	(Thousands of dollars)
Assets
Property, plant and equipment
Property, plant and equipment	$	4,447,285	$	4,269,377
Accumulated depreciation and amortization		1,476,832		1,442,423
Net property, plant and equipment		2,970,453		2,826,954
Current assets
Cash		2,682		4,040
Accounts receivable, net		124,418		260,306
Natural gas in storage		200,096		102,989
Regulatory assets		41,251		68,719
Other current assets		23,953		21,040
Total current assets		392,400		457,094
Goodwill and other assets
Regulatory assets		34,808		38,178
Goodwill		157,953		157,953
Other assets		16,474		11,153
Total goodwill and other assets		209,235		207,284
Total assets	$	3,572,088	$	3,491,332

See accompanying Notes to Financial Statements.

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ONE Gas Predecessor

BALANCE SHEETS

(Continued)

(Unaudited)	September 30, 2013		December 31, 2012
	(Thousands of dollars)
Equity and liabilities
Equity and long-term debt
Owner’s net investment	$	1,203,326	$	1,154,797
Long-term debt, excluding current maturities		1,319		1,323
Long-term line of credit with ONEOK		1,027,631		1,027,631
Total equity and long-term debt		2,232,276		2,183,751
Current liabilities
Current maturities of long-term debt		149		206
Short-term note payable to ONEOK		342,364		294,109
Affiliate payable		20,947		21,087
Accounts payable		75,072		137,276
Accrued taxes other than income		38,878		29,977
Customer deposits		55,857		58,087
Regulatory liabilities		23,237		9,584
Other current liabilities		15,677		28,376
Total current liabilities		572,181		578,702
Deferred credits and other liabilities
Deferred income taxes		697,291		649,303
Regulatory liabilities		23,051		29,526
Other deferred credits		47,289		50,050
Total deferred credits and other liabilities		767,631		728,879
Commitments and contingencies (Note 3)
Total equity and liabilities	$	3,572,088	$	3,491,332

See accompanying Notes to Financial Statements.

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ONE Gas Predecessor

STATEMENTS OF CASH FLOWS

	Nine Months Ended September 30,
(Unaudited)	2013			2012
	(Thousands of dollars)
Operating activities
Net income	$	68,877		$	57,867
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		100,118			97,481
Deferred income taxes		42,633			35,472
Provision for doubtful accounts		4,129			1,756
Changes in assets and liabilities:
Accounts receivable		131,759			200,684
Natural gas in storage		(97,107	)		7,280
Asset removal costs		(33,682	)		(31,262	)
Affiliate payable		(6,922	)		(7,306	)
Accounts payable		(56,484	)		(70,851	)
Accrued taxes other than income		8,901			7,772
Customer deposits		(2,230	)		(3,075	)
Regulatory assets and liabilities		28,255			(64,519	)
Other assets and liabilities		(12,123	)		(7,010	)
Cash provided by operating activities		176,124			224,289
Investing activities
Capital expenditures		(206,372	)		(200,093	)
Proceeds from sale of assets		1,044			255
Cash used in investing activities		(205,328	)		(199,838	)
Financing activities
Change in short-term note payable to ONEOK, net		48,255			51,582
Repayment of long-term debt		(61	)		(246	)
Distributions to ONEOK		(20,348	)		(77,552	)
Cash provided by (used in) financing activities		27,846			(26,216	)
Change in cash and cash equivalents		(1,358	)		(1,765	)
Cash and cash equivalents at beginning of period		4,040			4,475
Cash and cash equivalents at end of period	$	2,682		$	2,710

See accompanying Notes to Financial Statements.

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ONE Gas Predecessor

STATEMENTS OF CHANGES IN OWNER’S NET INVESTMENT

	Nine Months Ended September 30,
(Unaudited)	2013			2012
	(Thousands of dollars)
Balance at beginning of period	$	1,154,797		$	1,158,355
Net income		68,877			57,867
Distributions to ONEOK		(20,348	)		(77,552	)
Balance at end of period	$	1,203,326		$	1,138,670

See accompanying Notes to Financial Statements.

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ONE GAS Predecessor

NOTES TO FINANCIAL STATEMENTS (Unaudited)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited financial statements have been prepared pursuant to the rules and regulations of the SEC. These statements have been prepared in accordance with GAAP and reflect all adjustments that, in our opinion, are necessary for a fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The 2012 year-end balance sheet data was derived from our audited financial statements but does not include all disclosures required by GAAP. These unaudited financial statements should be read in conjunction with the audited financial statements in this Information Statement. Due to the seasonal nature of our business, the results of operations for the nine months ended September 30, 2013, are not necessarily indicative of the results that may be expected for a 12-month period.

Organization and Nature of Operations—ONE Gas, Inc. is a wholly owned subsidiary of ONEOK. On July 25, 2013, ONEOK announced that its Board of Directors unanimously authorized ONEOK’s management to pursue a plan to separate its natural gas distribution business into a stand-alone publicly traded company through the contribution of the natural gas distribution business to ONE Gas and the distribution of ONE Gas shares to shareholders of ONEOK. Following the separation, ONE Gas will be an independent, publicly traded company, and ONEOK will not retain any ownership interest in the company. We will consist of the business that ONEOK attributes to its natural gas distribution business, which is located in Oklahoma, Kansas and Texas.

We provide natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas through our divisions, Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively. We serve residential, commercial, industrial and transportation customers in all three states. In addition, these natural gas distribution companies serve wholesale and public authority customers.

Basis of Presentation—These financial statements have been derived from ONEOK’s financial statements, which include the natural gas distribution business as if ONE Gas Predecessor, the predecessor of ONE Gas for accounting purposes (“Predecessor”), had been a separate company for all periods presented. As the natural gas distribution business was comprised of divisions of ONEOK, Inc., these financial statements are presented as carved out from ONEOK, Inc. Although the legal transfer of ONEOK’s natural gas distribution businesses to ONE Gas has yet to take place, for ease of reference, these financial statements include references to “we,” “us” or “our” that relate to the Predecessor. The assets and liabilities in the financial statements have been reflected on a historical basis, as prior to the separation all of the assets and liabilities presented are wholly owned by ONEOK and are being transferred within the ONEOK consolidated group. The financial statements also include expense allocations for certain corporate functions historically performed by ONEOK, including allocations of general corporate expenses related to executive oversight, accounting, treasury, tax, legal and information technology. We believe our assumptions underlying the financial statements, including the assumptions regarding the allocation of general corporate expenses from ONEOK, are reasonable. However, the financial statements may not include all of the actual expenses that would have been incurred by us and may not reflect our results of operations, financial position and cash flows had we been a separate publicly traded company during the periods presented.

Because the operations of the distribution business within ONEOK are conducted through separate divisions, ONEOK’s net investment in us, excluding the short-term note payable and long-term line of credit with ONEOK, is shown as owner’s net investment in lieu of stockholder’s equity in the financial statements. Transactions between ONEOK and us which are not part of the long-term line of credit or short-term note payable with ONEOK have been identified in the Statements of Changes in Owner’s Net Investment as distributions to ONEOK. Transactions with ONEOK’s other operating businesses, which generally settle monthly, are shown as accounts receivable-affiliate or accounts payable-affiliate. See Note 2 for additional information on our transactions with ONEOK and its affiliates.

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The financial statements include the accounts of the natural gas distribution business as set forth in “Organization and Nature of Operations” and “Basis of Presentation” above. All significant intracompany balances and transactions have been eliminated.

Our significant accounting policies are consistent with those disclosed in Note 1 in the Annual Audited Financial Statements. The amounts of accrued unbilled revenues at September 30, 2013, and December 31, 2012, were $44.4 million and $127.1 million, respectively.

2. RELATED-PARTY TRANSACTIONS

Affiliate Transactions—We have certain transactions with ONEOK and its subsidiaries. We purchase a portion of our natural gas supply and natural gas transportation and storage services from ONEOK and its affiliates. These contracts are awarded through a competitive-bidding process, and the costs are recoverable through our purchased-gas cost mechanisms.

The Statements of Income include expense allocations for certain corporate functions historically performed by ONEOK and allocated to its natural gas distribution business, including allocations of general corporate expenses related to executive oversight, accounting, treasury, tax, legal, information technology and facilities maintenance. Where costs are incurred specifically on our behalf, the costs are billed directly to us by ONEOK. In other situations, the costs may be allocated to us through a variety of methods, depending upon the nature of the expenses. For example, a service that applies equally to all employees is allocated based upon the number of employees in each affiliate. An expense benefiting the company but having no direct basis for allocation is allocated by the modified Distrigas method, a method using a combination of ratios that include gross plant and investment, operating income and payroll expense. It is not practicable to determine what these general overhead costs would be on a stand-alone basis.

The following table shows ONEOK’s and its subsidiaries’ transactions with us for the periods indicated:

	Nine Months Ended
	September 30,
	2013			2012
	(Thousands of dollars)
Cost of natural gas	$	186,348		$	102,842
Operations and maintenance:
Direct employee labor and benefit costs		130,964			122,994
Allocated employee labor and benefit costs		23,104			17,315
Charges for general and administrative services		26,819			22,214
Depreciation and amortization		5,049			4,482
Other income, net		(2,978	)		(2,387	)
Interest expense		45,396			44,950
Total	$	414,702		$	312,410

Capitalized employee labor and benefit costs were $34.8 million and $33.2 million for the nine months ended September 30, 2013 and 2012, respectively. In addition, we recorded regulated utility revenue from ONEOK and its subsidiaries. These amounts were immaterial for both periods presented.

Total compensation cost, which includes costs for both employees that directly support our operations and allocations for corporate services, charged to us by ONEOK related to share-based payment plans was $10.2 million and $9.5 million for the nine months ended September 30, 2013 and 2012, respectively. Total cost charged to us by ONEOK related to pension and postretirement health and life insurance plans was $39.1 million and $32.0 million, which is net of amounts deferred through regulatory mechanisms of $1.5 million and $2.6 million, for the nine months ended September 30, 2013 and 2012, respectively. These costs are included within direct and allocated employee labor and benefit costs in the table above.

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ONEOK’s management believes these allocations are a reasonable reflection of the utilization of services provided. However, these allocations may not fully reflect the expenses that would have been incurred had we been a stand-alone company during the periods presented.

3. COMMITMENTS AND CONTINGENCIES

Environmental Matters—We are subject to multiple historical, wildlife preservation and environmental laws and/or regulations that affect many aspects of our present and future operations. Regulated activities include but are not limited to those involving air emissions, storm water and wastewater discharges, handling and disposal of solid and hazardous wastes, wetland preservation, hazardous materials transportation, and pipeline and facility construction. These laws and regulations require us to obtain and/or comply with a wide variety of environmental clearances, registrations, licenses, permits and other approvals. Failure to comply with these laws, regulations, licenses and permits may expose us to fines, penalties and/or interruptions in our operations that could be material to our results of operations. In addition, emission controls and/or other regulatory or permitting mandates under the Clean Air Act and other similar federal and state laws could require unexpected capital expenditures. We cannot assure that existing environmental statutes and regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional statutes or regulations that result in increased compliance costs or additional operating restrictions could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We own or retain legal responsibility for the environmental conditions at 12 former manufactured natural gas sites in Kansas. These sites contain potentially harmful materials that are subject to control or remediation under various environmental laws and regulations. A consent agreement with the KDHE governs all work at these sites. The terms of the consent agreement allow us to investigate these sites and set remediation activities based upon the results of the investigations and risk analysis. Remediation involves typically the management of contaminated soils and may involve removal of structures and monitoring and/or remediation of groundwater.

We have begun soil remediation on 11 of the 12 sites. Regulatory closure has been achieved at three locations, and we have completed or are near completion of soil remediation at eight sites. We have begun site assessment at the remaining site where no active remediation has occurred.

Our expenditures for environmental evaluation, mitigation, remediation and compliance to date have not been significant in relation to our financial position, results of operations or cash flows, and our expenditures related to environmental matters had no material effects on earnings or cash flows during the nine months ended September 30, 2013 or 2012. We do not expect to incur material expenditures for these matters in the future.

The EPA’s rule on air-quality standards known as RICE NESHAP included a compliance date in October 2013. We do not expect expenditures required to comply with this rule to have a material impact on our results of operations, financial position or cash flows.

Pipeline Safety—We are subject to PHMSA regulations, including integrity-management regulations. The Pipeline Safety Improvement Act of 2002 requires pipeline companies operating high-pressure pipelines to perform integrity assessments on pipeline segments that pass through densely populated areas or near specifically designated high-consequence areas. In January 2012, The Pipeline Safety, Regulatory Certainty and Job Creation Act of 2011 was signed into law. The law increased maximum penalties for violating federal pipeline safety regulations and directs the DOT and Secretary of Transportation to conduct further review or studies on issues that may or may not be material to us. These issues include but are not limited to the following:

• an evaluation on whether natural gas pipeline integrity-management requirements should be expanded beyond current high-consequence areas;

• a verification of records for pipelines in class 3 and 4 locations and high-consequence areas to confirm maximum allowable operating pressures; and

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• a requirement to test previously untested pipelines operating above 30 percent yield strength in high-consequence areas.

The potential capital and operating expenditures related to this legislation, the associated regulations or other new pipeline safety regulations are unknown.

Legal Proceedings—We are a party to various litigation matters and claims that have arisen in the normal course of our operations. While the results of litigation and claims cannot be predicted with certainty, we believe the reasonably possible losses from such matters, individually and in the aggregate, are not material. Additionally, we believe the probable final outcome of such matters will not have a material adverse effect on our results of operations, financial position or cash flows.

4. DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

Derivative Financial Instruments—We held purchased natural gas call options with fair values of $4.8 million and $1.8 million at September 30, 2013, and December 31, 2012, respectively. The premiums are recorded in current regulatory assets as these contracts are included in, and recoverable through, the purchased-gas cost adjustment mechanisms. We recorded a loss of $7.4 million and a gain of $3.8 million for the nine months ended September 30, 2013 and 2012, respectively, which are deferred as part of our unrecovered purchased-gas costs in current regulatory assets or other current liabilities in our Balance Sheets. Our natural gas call options are classified as Level 1 as fair value amounts are based on unadjusted quoted prices in active markets including NYMEX-settled prices. There were no transfers between levels for the nine months ended September 30, 2013 and 2012.

Other Financial Instruments—The approximate fair value of cash and cash equivalents, accounts receivable and accounts payable is equal to book value, due to the short-term nature of these items. Our cash and cash equivalents are comprised of bank and money market accounts and are classified as Level 1.

Debt payable to ONEOK includes a short-term note payable and a long-term line of credit as discussed in Note 2 of the annual audited financial statements. The short-term note payable to ONEOK is due upon demand and, therefore, the carrying amounts approximate fair value and are classified as Level 1. The estimated fair value of our long-term line of credit with ONEOK was $1.3 billion at September 30, 2013, and December 31, 2012, respectively. The book value of our long-term line of credit with ONEOK was $1.0 billion at September 30, 2013, and December 31, 2012. The long-term line of credit was valued using the income approach by discounting the future payments. Significant inputs include the discount rate which we estimated using a rate at which we could have borrowed at each measurement date. All inputs to this calculation are Level 3.

5. SUBSEQUENT EVENT

In December 2013, the KCC approved a settlement agreement between ONEOK, the staff of the KCC, and the Citizens’ Utility Ratepayer Board for our separation from ONEOK. Among other things, the terms of the settlement agreement include the following:

• Kansas Gas Service shall not change its base rates prior to January 1, 2017. The time limitation on filing a general rate case to change base rates does not preclude Kansas Gas Service from changing rates or tariffs to recover appropriate costs under its current approved riders and tariffs, including its COGR, ACA, WNA, AVTS and GSRS tariffs;

• Kansas Gas Service will expense certain costs associated with ONEOK’s acquisition of Kansas Gas Service in 1997 that previously have been recorded as a regulatory asset and are being amortized and recovered in rates over a 40-year period. As such, we expect to record a noncash charge to income of approximately $10.2 million before taxes in the fourth quarter 2013;

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• The level of pension and postretirement benefit costs used to calculate Kansas Gas Service’s Pension and Other Postretirement Benefit Trackers shall be adjusted to $13.6 million from $16.6 million with a corresponding reduction to revenues; and

• ONEOK agrees to make a one-time contribution to 501(c)(3) organizations of $1.2 million to provide financial assistance for weatherization of housing for low income natural gas customers of Kansas Gas Service.

The agreement authorizes the transfer of ONEOK’s existing Kansas natural gas distribution assets, certificates of convenience and necessity, franchises and tariffs to us conditioned upon the completion of the separation. Completion of the separation is subject to certain conditions, including final approval from the ONEOK Board of Directors.

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