CHARTER OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS



Purpose. The Compensation Committee is appointed by the Board to discharge the Board's responsibilities relating to compensation of the Company's directors and executive officers. The Compensation Committee has overall responsibility for approving and evaluating the director and executive officer compensation plans, policies and programs of the Company.

The Compensation Committee is also responsible for producing an annual report on executive officer compensation for inclusion in the Company's proxy statement.

Composition and Independence. The Compensation Committee shall consist of no fewer than three members. The members of the Compensation Committee shall meet the independence requirements of the New York Stock Exchange.

The members of the Compensation Committee shall be appointed by the Board on the recommendation of the Nominating and Corporate Governance Committee. Compensation Committee members may be replaced by the Board.

Reports. The Compensation Committee shall make regular reports to the Board.

Meetings. The Compensation Committee shall meet as often as its members deem necessary to perform the Committee's responsibilities.

Authority and Responsibilities. The Compensation Committee shall have the following authority and responsibilities. This list is set forth as a guide with the understanding that the Committee may diverge from this guide as appropriate under the circumstances.

  1. The Compensation Committee shall have the sole authority to retain and terminate any compensation consultant to be used to assist in the evaluation of director, CEO or executive officer compensation and shall have the sole authority to approve the consultant's fees and other retention terms. The Compensation Committee shall also have the authority to obtain advice and assistance from internal or external legal, accounting or other advisors.
  2. The Compensation Committee shall annually review and approve corporate goals and objectives relevant to CEO compensation, evaluate the CEO's performance in light of those goals and objectives, and, either as a Committee or together with the other independent directors (as directed by the Board) determine and approve the CEO's compensation level based on this evaluation. In determining the long-term incentive component of CEO compensation, the Compensation Committee may consider the Company's performance and relative stockholder return, the value of similar incentive awards to CEOs at comparable companies, and the awards given to the CEO in past years.
  3. The Compensation Committee shall annually review and make recommendations to the Board with respect to the compensation of all directors and non-CEO executive officers, including incentive-compensation and equity-based plans that are subject to Board approval.
  4. The Compensation Committee shall annually review and approve for the CEO, and review and make recommendations to the Board for non-CEO executive officers, (a) the annual base salary level, (b) any annual incentive opportunity (which, in the case of non-CEO executive officers, is subject to Board approval), (c) any long-term incentive opportunity (which, in the case of non-CEO executive officers, is subject to Board approval), (d) employment agreements, severance arrangements, and change in control agreements/provisions, in each case as, when and if appropriate, and (e) any special or supplemental benefits.
  5. The Compensation Committee may form and delegate authority to subcommittees when appropriate.
  6. The Compensation Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval.
  7. The Compensation Committee shall annually review its own performance.
  8. The Compensation Committee shall administer the Vintage Petroleum, Inc. 1990 Stock Plan, as amended.
  9. The Compensation Committee shall administer the Vintage Petroleum, Inc. Amended and Restated Discretionary Performance Bonus Program.