ONEOK INC /NEW/ 10-K (Annual Reports) 2009-02-25

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2008.
OR
__ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________ to __________.
Commission file number 001-13643
ONEOK, Inc.
(Exact name of registrant as specified in its charter)
Oklahoma 73-1520922
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
100 West Fifth Street, Tulsa, OK 74103

(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code (918) 588-7000
Securities registered pursuant to Section 12(b) of the Act:

Common stock, par value of $0.01 New York Stock Exchange
(Title of Each Class) (Name of Each Exchange on which Registered)
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes X No__.
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes __ No X.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been
subject to such filing requirements for the past 90 days. Yes X No __
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Registration S-K (§229.405) is not contained herein, and will
not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. X
Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of
“accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one)
Large accelerated filer X Accelerated filer __ Non-accelerated filer __
Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes__ No X.
Aggregate market value of registrant’s common stock held by non-affiliates based on the closing trade price on June 30, 2008, was $5.1 billion.
On February 18, 2009, the Company had 105,239,496 shares of common stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the definitive proxy statement to be delivered to shareholders in connection with the Annual Meeting of Shareholders to be held
May 21, 2009, are incorporated by reference in Part III.
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ONEOK, Inc.
2008 ANNUAL REPORT ON FORM 10-K
Part I. Page No.
Item 1. Business 5-17
Item 1A. Risk Factors 17-29
Item 1B. Unresolved Staff Comments 29
Item 2. Properties 29-30
Item 3. Legal Proceedings 31-32
Item 4. Submission of Matters to a Vote of Security Holders 32
Part II.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity 32-34
Securities
Item 6. Selected Financial Data 35
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation 35-62
Item 7A. Quantitative and Qualitative Disclosures about Market Risk 63-66
Item 8. Financial Statements and Supplementary Data 67-117
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 117
Item 9A. Controls and Procedures 117-118
Item 9B. Other Information 118
Part III.
Item 10. Directors, Executive Officers and Corporate Governance 118-119
Item 11. Executive Compensation 119
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 119
Item 13. Certain Relationships and Related Transactions, and Director Independence 120
Item 14. Principal Accounting Fees and Services 120
Part IV.
Item 15. Exhibits, Financial Statement Schedules 120-125
Signatures 126
As used in this Annual Report on Form 10-K, references to “we,” “our” or “us” refers to ONEOK, Inc., an Oklahoma corporation, and its
predecessors and subsidiaries, unless the context indicates otherwise.
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GLOSSARY
The abbreviations, acronyms and industry terminology used in this Annual Report on Form 10-K are defined as follows:
AFUDC Allowance for funds used during construction

APB Opinion Accounting Principles Board Opinion
ARB Accounting Research Bulletin
Bbl Barrels, 1 barrel is equivalent to 42 United States gallons
Bbl/d Barrels per day
BBtu/d Billion British thermal units per day
Bcf Billion cubic feet
Bcf/d Billion cubic feet per day
Black Mesa Pipeline Black Mesa Pipeline, Inc.
Btu British thermal units, a measure of the amount of heat required to raise
the temperature of one pound of water one degree Fahrenheit
Bushton Plant Bushton Gas Processing Plant
EBITDA Earnings before interest, taxes, depreciation and amortization
EITF Emerging Issues Task Force
EPA United States Environmental Protection Agency
Exchange Act Securities Exchange Act of 1934, as amended
FASB Financial Accounting Standards Board
FERC Federal Energy Regulatory Commission
FIN FASB Interpretation
Fort Union Gas Gathering Fort Union Gas Gathering, L.L.C.
GAAP Generally Accepted Accounting Principles in the United States
Guardian Pipeline Guardian Pipeline, L.L.C.
Heartland Heartland Pipeline Company
IRS Internal Revenue Service
KCC Kansas Corporation Commission
KDHE Kansas Department of Health and Environment
LDCs Local Distribution Companies
LIBOR London Interbank Offered Rate
MBbl Thousand barrels
MBbl/d Thousand barrels per day
Mcf Thousand cubic feet
Midwestern Gas Transmission Midwestern Gas Transmission Company
MMBbl Million barrels
MMBtu Million British thermal units
MMBtu/d Million British thermal units per day
MMcf Million cubic feet
MMcf/d Million cubic feet per day
Moody’s Moody’s Investors Service, Inc.
NGL(s) Natural gas liquid(s)
Northern Border Pipeline Northern Border Pipeline Company
NYMEX New York Mercantile Exchange
NYSE New York Stock Exchange
OBPI ONEOK Bushton Processing Inc.
OCC Oklahoma Corporation Commission
ONEOK ONEOK, Inc.
ONEOK Leasing Company ONEOK Leasing Company, L.L.C.
ONEOK Partners ONEOK Partners, L.P.
ONEOK Partners GP ONEOK Partners GP, L.L.C., a wholly owned subsidiary of ONEOK
and the sole general partner of ONEOK Partners
OPIS Oil Price Information Service
Overland Pass Pipeline Company Overland Pass Pipeline Company LLC
RRC Texas Railroad Commission
S&P Standard & Poor’s Rating Group
SEC Securities and Exchange Commission
Statement Statement of Financial Accounting Standards
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TC PipeLines TC PipeLines Intermediate Limited Partnership, a subsidiary of TC

PipeLines, LP
TransCanada TransCanada Corporation
The statements in this Annual Report on Form 10-K 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,” “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 Part I, Item 1A, Risk Factors, and Part II, Item 7, Management’s
Discussion and Analysis of Financial Condition and Results of Operation and “Forward-Looking Statements,” in this Annual Report on
Form 10-K for the year ended December 31, 2008.
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PART I
ITEM 1. BUSINESS
GENERAL
We are a diversified energy company and successor to the company founded in 1906 known as Oklahoma Natural Gas Company. Our common
stock is listed on the NYSE under the trading symbol “OKE.” We are the sole general partner and own 47.7 percent of ONEOK Partners, L.P.
(NYSE: OKS), one of the largest publicly traded master limited partnerships. ONEOK Partners is a leader in the gathering, processing, storage
and transportation of natural gas in the United States. In addition, ONEOK Partners owns one of the nation’s premier natural gas liquids
systems, connecting NGL supply in the Mid-Continent and Rocky Mountain regions with key market centers. 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 distribution markets are Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita, and Topeka,
Kansas; and Austin and El Paso, Texas. Our energy services operation is engaged in providing premium natural gas marketing services to
wholesale and retail customers across the United States and Canada.
DESCRIPTION OF BUSINESS SEGMENTS
We report operations in the following reportable business segments:

•ONEOK Partners
•Distribution
•Energy Services
•Other
For financial and statistical information regarding our business segments, see below in the “Segment Financial Information” section, Item 7,
Management’s Discussion and Analysis of Financial Condition and Results of Operation and Note M of the Notes to Consolidated Financial
Statements in this Annual Report on Form 10-K.
Business Strategy
Our primary business strategy is to deliver consistent growth and sustainable earnings, while focusing on safe, reliable, environmentally
sound and legally compliant operations for our customers, employees, contractors and the public through the following:
•developing and executing internally generated growth projects within our ONEOK Partners segment;
•increasing the level of sustainable earnings in our Distribution segment;
•continuing our focus on physical activities in our Energy Services segment;
•executing strategic acquisitions that utilize our core competencies; and
•managing our balance sheet over the long term to maintain our credit ratings at or above their current investment-grade levels.
ONEOK Partners - ONEOK Partners’ primary business objectives are to generate cash flow sufficient to pay quarterly cash distributions to
its unitholders and to increase its quarterly cash distributions over time. ONEOK Partners’ ability to maintain and grow its distributions to
unitholders depends on, among other things, the growth of its existing businesses and strategic acquisitions. We plan to continue pursuing
internal growth opportunities and strategic acquisitions related to gathering, processing, fractionating, transporting, storing and marketing
natural gas and NGLs that will utilize our core competencies, minimize commodity price risk and provide long-term, sustainable and stable cash
flows. Our strategy focuses on maintaining stable cash flows through predominantly fee-based income, equity earnings derived primarily from
fee-based earnings, and by managing commodity and spread risk.
Distribution - Our integrated strategy for our LDCs incorporates a rates and regulatory plan that includes positive relationships with
regulators, consistent strategies and synchronized rate case filings. We focus on growth of our customer count and rate base through
efficient investment in our system while emphasizing safety and cost control. We provide customer choice programs designed to reduce
volumetric sensitivity and create value for our customers.
Energy Services - Our Energy Services segment creates value by providing premium services to our customers by delivering physical and risk
management products and services to our customers through our network of contracted gas supply and leased transportation and storage
assets. We optimize our storage and transportation capacity through the daily application of market knowledge and effective risk
management.
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Outlook for 2009
We expect continued deteriorating economic conditions in 2009, with downward pressures, relative to 2008, on commodity prices for natural
gas, NGLs and crude oil. We anticipate that lower commodity prices will result in reduced drilling activity and economic conditions will result
in reduced petrochemical demand. We also expect continued volatility and disruption in the financial markets which could result in an
increased cost of capital. We expect depressed commodity prices and tighter capital markets to also result in the sale or consolidation of
underperforming assets in the industry, which may present opportunities for us.
ONEOK Partners - ONEOK Partners intends to pursue continued growth in its natural gas businesses through well-connects, contract
renegotiations and expansions and extensions of its existing systems and plants. For its natural gas liquids businesses, ONEOK Partners will
continue to focus on adding new supply connections and optimizing existing assets, as well as completing the growth projects currently under
construction. Capital expenditures in 2009 are expected to be significantly lower than in 2008 when ONEOK Partners spent approximately $1.3
billion. ONEOK Partners plans to spend approximately $425 million on capital expenditures in 2009, of which approximately $355 million is for
growth projects. ONEOK Partners also plans to pursue strategic acquisitions related to gathering, processing, fractionating, storing,
transporting and marketing natural gas and NGLs.
Distribution - In our Distribution segment, we plan to grow our asset base through efficient capital investment in infrastructure and
technology and increase the level of sustainable earnings.
Energy Services - In our Energy Services segment, we expect higher natural gas basis differentials. We plan to manage our current portfolio
of supply and leased assets, reduce storage capacity utilization as compared with 2008, continue to offer premium products and services, and
draw on the competitive position of our assets to extract incremental value through daily optimization of storage and transportation
assets. Additionally, we plan to grow our asset management agreements with LDCs, use hedging to establish base margins and capture
incremental margins related to location and seasonal differences, and continue to achieve high customer satisfaction.
SIGNIFICANT DEVELOPMENTS IN 2008
Capital Projects - ONEOK Partners placed the following projects in-service during 2008:
•January - Midwestern Gas Transmission’s eastern extension pipeline;
•July - final phase of Fort Union Gas Gathering expansion project;
•September - Woodford Shale natural gas liquids pipeline extension;
•October - Bushton Fractionation expansion;
•November - Overland Pass Pipeline from Opal, Wyoming to Conway, Kansas; and
•December - partial operations of the Guardian Pipeline extension with interruptible service from Ixonia, Wisconsin, to Green Bay,
Wisconsin.
Equity Issuance - In March 2008, we purchased from ONEOK Partners, in a private placement, an additional 5.4 million of ONEOK Partners’
common units for a total purchase price of approximately $303.2 million. In addition, ONEOK Partners completed a public offering of 2.5 million
common units at $58.10 per common unit and received net proceeds of $140.4 million after deducting underwriting discounts but before
offering expenses. In conjunction with ONEOK Partners’ private placement and public offering of common units, ONEOK Partners GP
contributed $9.4 million to ONEOK Partners in order to maintain its 2 percent general partner interest.
In April 2008, ONEOK Partners sold an additional 128,873 common units at $58.10 per common unit to the underwriters of the public offering
upon the partial exercise of their option to purchase additional common units to cover over-allotments. ONEOK Partners received net
proceeds of approximately $7.2 million from the sale of these common units after deducting underwriting discounts but before offering
expenses. In conjunction with the partial exercise by the underwriters, ONEOK Partners GP contributed $0.2 million to ONEOK Partners in
order to maintain its 2 percent general partner interest. Following these transactions, our ownership interest in ONEOK Partners is 47.7
percent.
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SEGMENT FINANCIAL INFORMATION
Operating Income - The following table sets forth operating income by segment, as a percentage of our consolidated total, excluding any gain
or (loss) on sale of assets, for the periods indicated.
Years Ended December 31,

Operating Income 2008 2007 2006
ONEOK Partners 70% 54% 53%
Distribution 21% 21% 16%
Energy Services 8% 25% 31%
Other and Eliminations 1% * *
Total 100% 100% 100%
* Represents a value of less than 1 percent.
Customers and Total Assets - See Note M of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for
discussion of revenues from external customers under “Customers” and disclosure of total assets by segment within the “Operating Segment
Information” table.
Intersegment Revenues - The following table sets forth the percentage of intersegment revenues to total revenue, by segment, for the periods
indicated.

Intersegment Revenues 2008 2007 2006
ONEOK Partners 10% 11% 13%
Distribution * * *
Energy Services 8% 7% 8%
* Represents a value of less than 1 percent.
See Note M of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for additional information about
intersegment revenues.
NARRATIVE DESCRIPTION OF BUSINESS
ONEOK Partners
Ownership - We own approximately 42.4 million common and Class B limited partner units, and the entire 2 percent general partner interest,
which, together, represents a 47.7 percent ownership interest in ONEOK Partners. We receive distributions from ONEOK Partners on our
common and Class B units and our 2 percent general partner interest. See Note Q of the Notes to Consolidated Financial Statements in this
Annual Report on Form 10-K for discussion of our incentive distribution rights.
Business Strategy - ONEOK Partners’ primary business objectives are to generate cash flow sufficient to pay quarterly cash distributions to
its unitholders and to increase its quarterly cash distributions over time. ONEOK Partners plans to accomplish these objectives while focusing
on safe, environmentally sound and legally compliant operations for its customers, employees, contractors and the public through the
following:
•developing and executing internally generated growth projects;
•executing strategic acquisitions related to gathering, processing, fractionating, storing, transporting and marketing natural gas and
NGLs that utilize its core competencies; and
•managing its balance sheet over the long-term to maintain its investment-grade credit ratings at or above their current levels.
Description of Business - Our ONEOK Partners segment is engaged in the gathering and processing of unprocessed natural gas and
fractionation of NGLs, primarily in the Mid-Continent, and Rocky Mountain regions covering Oklahoma, Kansas, Montana, North Dakota and
Wyoming. These operations include the gathering of unprocessed natural gas produced from crude oil and natural gas wells. Through
gathering systems, unprocessed natural gas is aggregated and treated or processed for removal of water vapor, solids and other contaminants,
and to extract NGLs in order to provide marketable natural gas, commonly referred to as residue gas. When the NGLs are separated from the
unprocessed natural gas at the processing plants, the NGLs are generally in the form of a mixed, unfractionated NGL stream. This stream is
then separated by a distillation process, referred to as fractionation, into marketable product components such as ethane, ethane/propane (EP),
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propane, iso-butane, normal butane and natural gasoline (collectively, NGL products). These NGL products can then be stored, transported
and marketed to a diverse customer base of end-users.
Revenue from the gathering and processing business is primarily derived from the following three types of contracts:
•Percent of Proceeds - ONEOK Partners retains a percentage of the NGLs and/or a percentage of the residue gas as payment for
gathering, compressing and processing the producer’s unprocessed natural gas. For 2008, this type of contract represented
approximately 34 percent of contracted volumes.
•Fee - ONEOK Partners is paid a fee for the services provided based on Btus gathered, compressed and/or processed. For 2008, this
type of contract represented approximately 58 percent of contracted volumes.
•Keep-Whole - ONEOK Partners extracts NGLs from unprocessed natural gas and returns to the producer volumes of residue gas
containing the same amount of Btus as the unprocessed natural gas that was originally delivered. For 2008, this type of contract
represented approximately 8 percent of contracted volumes, with approximately 89 percent of that contracted volume containing
language that effectively converts these contracts into fee contracts when the gross processing spread is negative.
ONEOK Partners also gathers, treats, fractionates, transports and stores NGLs. ONEOK Partners’ natural gas liquids gathering pipelines
deliver unfractionated NGLs gathered from natural gas processing plants located in Oklahoma, Kansas, the Texas panhandle and the Rocky
Mountain region to fractionators it owns in Oklahoma, Kansas, and Texas. The NGLs are then separated through the fractionation process
into the individual NGL products that realize the greater economic value of the NGL components. The individual NGL products are then stored
or distributed to petrochemical manufacturers, heating fuel users, refineries and propane distributors through ONEOK Partners’ distribution
pipelines that move NGL products from Oklahoma and Kansas to the market centers in Conway, Kansas, and Mont Belvieu, Texas, as well as
the Midwest markets near Chicago, Illinois.
Revenue for the natural gas liquids businesses is primarily derived from the following types of services:
•Exchange services - ONEOK Partners gathers and transports unfractionated NGLs to its fractionators, separating them into
marketable products and redelivering the NGL products to its customers for a fee;
•Optimization and marketing - ONEOK Partners uses its asset base, portfolio of contracts and market knowledge to capture location
and seasonal price differentials through transactions that optimize the flow of its NGL products between the major market centers in
Conway, Kansas, and Mont Belvieu, Texas, as well as markets near Chicago, Illinois;
•Isomerization - ONEOK Partners converts normal butane to the more valuable iso-butane used by the refining industry to increase the
octane of motor gasoline;
•Storage services - ONEOK Partners stores NGLs for a fee; and
•Transportation - ONEOK Partners transports NGLs under its FERC-regulated tariffs.
ONEOK Partners operates interstate and intrastate natural gas transmission pipelines, natural gas storage facilities and non-processable
natural gas gathering facilities. ONEOK Partners also provides natural gas transportation and storage services in accordance with Section
311(a) of the Natural Gas Policy Act. ONEOK Partners’ interstate assets transport natural gas through FERC-regulated interstate natural gas
pipelines that access supply from Canada and from the Mid-Continent, Rocky Mountain and Gulf Coast regions. ONEOK Partners’ pipelines
include Midwestern Gas Transmission, Guardian Pipeline, Viking Gas Transmission Company, OkTex Pipeline Company L.L.C. and a 50 percent
ownership interest in Northern Border Pipeline.
ONEOK Partners’ intrastate natural gas pipeline assets in Oklahoma have access to the major natural gas producing areas and transport
natural gas throughout the state. ONEOK Partners also has access to the major natural gas producing area in south central Kansas. In Texas,
its intrastate natural gas pipelines are connected to the major natural gas producing areas in the Texas panhandle and the Permian Basin, and
transport natural gas to the Waha Hub, where other pipelines may be accessed for transportation east to the Houston Ship Channel market,
north into the Mid-Continent market and west to the California market. ONEOK Partners owns or leases storage capacity in underground
natural gas storage facilities in Oklahoma, Kansas and Texas. ONEOK Partners’ natural gas pipeline assets primarily serve LDCs, large
industrial companies, municipalities, irrigation customers, power generation facilities and marketing companies.
ONEOK Partners’ revenues from its natural gas pipelines are typically derived from fee services under the following types of contracts:
•Firm service - Customers can reserve a fixed quantity of pipeline or storage capacity for the terms of their contracts. Under this type
of contract, the customer pays a fixed fee for a specified quantity regardless of their actual usage, and is generally guaranteed access
to the capacity they reserve; and
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•Interruptible service - Customers with interruptible service transportation and storage agreements may utilize available capacity after
firm service requests are satisfied or on an as available basis. Under the interruptible service contract, the customer is not guaranteed
use of our pipelines and storage facilities unless excess capacity is available.
The main factors that affect ONEOK Partners’ margins are:

•NGL transportation and fractionation volumes and associated fees;
•natural gas transportation and storage volumes;
•weather impacts on demand and operations;
•fees charged for processing services and storage services;
•the Mid-Continent, Gulf Coast and Rocky Mountain natural gas price, crude oil price and the daily average OPIS price for its products
sold, as well as the relative value on a Btu basis of each of the components to each other;
•the relative value of ethane to natural gas; and
•regional and seasonal natural gas and NGL product price differentials.
Market Conditions and Seasonality - Supply - ONEOK Partners’ business is affected by the economy, commodity price volatility, and
weather. The strength of the economy has a direct relationship on manufacturing and industrial companies’ demand for natural gas and NGL
products. Volatility in the commodity markets impacts the decisions of ONEOK Partners’ customers relating to the output of the gas
processing plants, storage activity for natural gas and natural gas liquids, and demand for the various NGL products. In addition, its natural
gas liquids pipelines and fractionation facilities are affected by operational or market-driven changes in the output of the gas processing
plants to which they are connected. Natural gas and NGL output from gas processing plants may increase or decrease affecting the quality of
natural gas and volume of NGLs transported through the systems as a result of the gross processing spread, which is the difference between
the relative value of the composite price of NGLs to the price of natural gas, primarily ethane to natural gas. In addition, volume delivered
through the system may increase or decrease as a result of the relative NGL price between the Mid-Continent and Gulf Coast regions. Natural
gas transportation throughput fluctuates due to rainfall that impacts irrigation demand, hot temperatures that affect power generation demand
and cold temperatures that affect heating demand.
Natural gas and NGL supply is affected by rig availability, operating capability and producer drilling activity, which is sensitive to commodity
prices, exploration success, available capital and regulatory control. Relatively high natural gas and crude oil prices, resulted in increased
drilling for most of 2008 in the Mid-Continent and Rocky Mountain regions, which are our primary supply regions. Significant price declines
and reduced drilling activity starting in the fourth quarter of 2008 are now creating less favorable near-term supply projections.
Demand - Demand for gathering and processing services is typically aligned with the supply of natural gas, which generally flows from a
producing area at a relatively steady but gradually declining pace over time unless new reserves are added. ONEOK Partners’ plant operations
can be adjusted to respond to market conditions, such as demand for ethane. By changing operating parameters at certain plants, ONEOK
Partners can produce more of the specific commodity that has the most favorable price or price spread.
Demand for natural gas pipeline transportation service and natural gas storage is directly related to demand for natural gas in the markets that
the natural gas pipelines and storage facilities serve, and is affected by weather, the economy, and natural gas price volatility. The effect of
weather on ONEOK Partners’ natural gas pipelines operations is discussed below under “Seasonality.” The strength of the economy directly
impacts manufacturing and industrial companies that rely on natural gas. Commodity price volatility can influence customers’ decisions
related to the usage of natural gas versus alternative fuels and natural gas storage injection and withdrawal activity.
Demand for NGLs and the ability of natural gas processors to successfully and economically sustain their operations impacts the volume of
unfractionated NGLs produced by natural gas processing plants, thereby affecting the demand for natural gas liquids gathering, fractionation
and distribution services. Natural gas and propane are subject to weather-related seasonal demand.
Other products are affected by economic conditions and the demand associated with the various industries that utilize the commodity, such as
butanes and natural gasoline, which are used by the refining industry as blending stocks for motor fuel. Ethane and EP are used by the
petrochemical industry to produce chemical products, such as plastic, rubber and synthetic fiber.
Commodity Prices - During 2008, both crude oil and natural gas prices were volatile, with NYMEX crude oil settlement prices ranging from
$49.62 to $134.62 per Bbl and NYMEX natural gas settlement prices ranging from $6.47 to $13.11 per MMBtu.
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Seasonality - Some of ONEOK Partners’ products, such as natural gas and propane used for heating, are subject to seasonality, resulting in
more demand during the months of November through March. As a result, prices of these products are typically higher during that time
period. Demand has also increased for natural gas in the summer periods as more electric generation is now dependent upon natural gas for
fuel. Other products, such as ethane and EP, are tied to the petrochemical industry, while normal butane, iso-butane and natural gasoline are
used by the refining industry as blending stocks. As a result, the prices of these products are affected by the economic conditions and
demand associated with these various industries.
Competition - ONEOK Partners’ natural gas and natural gas liquids pipelines compete directly with other intrastate and interstate pipeline
companies and other storage facilities for natural gas and NGLs. Competition for natural gas transportation services continues to increase as
the FERC and state regulatory bodies continue to encourage more competition in the natural gas markets. Competition among pipelines and
storage facilities is based primarily on fees for services, quality of services provided, current and forward natural gas prices and proximity to
supply areas and markets. ONEOK Partners believes that its pipelines and storage assets enable it to effectively compete.
ONEOK Partners’ natural gas gathering and processing business competes for natural gas supplies with major integrated exploration and
production companies, pipeline companies and their affiliated marketing companies, national and local natural gas gatherers and processors,
and marketers in the Mid-Continent and Rocky Mountain regions. ONEOK Partners’ gathering and fractionation business competes with
other fractionators, storage providers and gatherers for NGL supplies in the Rocky Mountain, Mid-Continent and Gulf Coast regions. The
factors that typically affect ONEOK Partners’ ability to compete for natural gas and NGL supplies are:
•producer drilling activity;
•the petrochemical industry’s level of capacity utilization and feedstock requirements;
•fees charged under our contracts;
•pressures maintained on our gathering systems;
•location of our gathering systems relative to our competitors;
•location of our gathering systems relative to drilling activity;
•efficiency and reliability of our operations; and
•delivery capabilities that exist in each system, plant and storage location.
ONEOK Partners is responding to these industry conditions by making capital investments to access new supplies, increase gathering and
fractionation capacity, increase storage capabilities, improve plant processing flexibility and reduce operating costs, evaluating consolidation
opportunities to maximize earnings, selling assets in non-core operating areas and renegotiating unprofitable contracts. The principal goal of
the contract renegotiation effort is to eliminate unprofitable contracts and improve margins, primarily during periods when the gross
processing spread is negative.
Government Regulation - The FERC has traditionally maintained that a processing plant is not a facility for the transportation or sale for resale
of natural gas in interstate commerce and, therefore, is not subject to jurisdiction under the Natural Gas Act. Although the FERC has made no
specific declaration as to the jurisdictional status of ONEOK Partners’ natural gas processing operations or facilities, ONEOK Partners’ natural
gas processing plants are primarily involved in removing NGLs and, therefore, ONEOK Partners believes, its natural gas processing plants are
exempt from FERC jurisdiction. The Natural Gas Act also exempts natural gas gathering facilities from the jurisdiction of the FERC. Interstate
transmission facilities remain subject to FERC jurisdiction. The FERC has historically distinguished between these two types of facilities,
either interstate or intrastate, on a fact-specific basis. ONEOK Partners believes its gathering facilities and operations meet the criteria used by
the FERC for non-jurisdictional gathering facility status. ONEOK Partners can transport residue gas from its plants to interstate pipelines in
accordance with Section 311(a) of the Natural Gas Policy Act.
Oklahoma and Kansas also have statutes regulating, in various degrees, the gathering of natural gas in those states. In each state, regulation
is applied on a case-by-case basis if a complaint is filed against the gatherer with the appropriate state regulatory agency.
ONEOK Partners’ interstate natural gas pipelines are regulated under the Natural Gas Act and Natural Gas Policy Act, which give the FERC
jurisdiction to regulate virtually all aspects of the pipeline activities. ONEOK Partners’ intrastate natural gas transportation assets in
Oklahoma, Kansas and Texas are regulated by the OCC, KCC and RRC, respectively. ONEOK Partners has flexibility in establishing natural
gas transportation rates with customers. However, there are maximum rates that ONEOK Partners can charge its customers in Oklahoma and
Kansas.
ONEOK Partners’ proprietary natural gas liquids gathering pipelines in both Oklahoma and Kansas are not regulated by the FERC or the
states’ respective corporation commissions. ONEOK Partners’ remaining natural gas liquids gathering and
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distribution pipelines are interstate pipelines regulated by the FERC. ONEOK Partners transports unfractionated NGLs and NGL products
pursuant to filed tariffs.
Additionally, the operations of our assets are regulated by various state and federal government agencies. See further discussion in the
“Environmental and Safety Matters” section.
Unconsolidated Affiliates - Our ONEOK Partners segment has the following unconsolidated affiliates:
•50 percent interest in Northern Border Pipeline, which transports natural gas from the Montana-Saskatchewan border near Port
Morgan, Montana, to a terminus near North Hayden, Indiana;
•49 percent ownership interest in Bighorn Gas Gathering, L.L.C., which operates a major coalbed methane gathering system serving a
broad production area in northeast Wyoming;
•37 percent ownership interest in Fort Union Gas Gathering, which gathers coalbed methane gas produced in the Powder River Basin
and delivers natural gas into the interstate pipeline grid;
•35 percent ownership interest in Lost Creek Gathering Company, L.L.C., which gathers natural gas produced from conventional wells
in the Wind River Basin of central Wyoming and delivers natural gas into the interstate pipeline grid;
•10 percent ownership interest in Venice Energy Services Co., LLC, a gas processing complex near Venice, Louisiana;
•50 percent ownership interest in Chisholm Pipeline Company which operates an interstate natural gas liquids pipeline system
extending approximately 184 miles from origin points in Oklahoma and Kansas;
•48 percent ownership interest in Sycamore Gas System, which is a gathering system with compression located in south central
Oklahoma; and
•50 percent ownership interest in the Heartland joint venture, which operates a terminal and pipeline systems that transport refined
petroleum products in Kansas, Nebraska and Iowa.
See Note O of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for additional discussion of unconsolidated
affiliates.
Distribution
Business Strategy - Our Distribution segment focuses on increasing the level of sustainable earnings through safe, reliable, environmentally
sound and legally compliant distribution operations.
The integrated strategy for our LDCs incorporates:

• a rates and regulatory strategy that includes fostering positive relationships with regulators, consistent strategies and
synchronized rate case filings;
• a focus on the growth of our customer count and rate base through efficient investment in our system while emphasizing safety
and cost control; and
• providing customer choice programs designed to reduce volumetric sensitivity and create value for our customers.
Our regulatory strategy incorporates rate features that provide strategies for earnings lag, margin protection and risk mitigation. These
strategies include capital recovery mechanisms in Oklahoma, Kansas and portions of Texas. In Texas, we also have cost of service
adjustments that address investments in rate base and changes in expense. Margin protection strategies include increased customer fixed
charges in all three states. Risk mitigation strategies include fuel related bad-debt recovery mechanisms in Oklahoma, Kansas and portions of
Texas.
Description of Business - Our Distribution segment provides natural gas distribution services to more than two million customers in
Oklahoma, Kansas and Texas through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively, each a division of
ONEOK. We serve residential, commercial, industrial and transportation customers in all three states. In addition, our distribution companies
in Oklahoma and Kansas serve wholesale customers, and in Texas we serve public authority customers, such as cities, governmental agencies
and schools.
Our operating results are primarily affected by the number of customers, usage and the ability to collect delivery rates that provide a
reasonable rate of return on our investment and recovery of our cost of service. Natural gas costs are passed through to our customers based
on the actual cost of gas purchased by the respective distribution companies. Substantial fluctuations in natural gas sales can occur from
year to year without materially or adversely impacting our net margin, since the fluctuations in natural gas costs affect natural gas sales and
cost of gas by an equivalent amount. Higher natural gas costs may cause customers to conserve or, in the case of industrial customers, to use
alternative energy sources. Higher natural gas costs may also adversely impact our accounts receivable collections, resulting in higher bad-
debt expense.
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The rate structure for Oklahoma Natural Gas includes two service rate options for residential gas sales customers. Certain high usage
customers pay a higher monthly service charge and a lower per dekatherm delivery charge, while lower usage customers pay a lower monthly
service charge coupled with a higher per dekatherm delivery charge. Customers can elect to change service rate options to ensure that they
are billed under the alternative that best fits their individual usage, but they must remain on the selected option for a full year after the change
is made.
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 distribution markets for Oklahoma, Kansas and Texas, respectively. Natural gas sold to residential and
commercial customers accounts for approximately 79 and 20 percent of natural gas sales, respectively, in Oklahoma; 74 and 19 percent of
natural gas sales, respectively, in Kansas; and 66 and 26 percent of natural gas sales, respectively, in Texas.
A franchise, although nonexclusive, is a utility’s right to use the municipal streets, alleys and other public ways for a defined period of time in
exchange for a fee. In management’s opinion, our franchises contain no unduly burdensome restrictions and are sufficient for the transaction
of business in the manner in which it is now conducted.
Market Conditions and Seasonality - Supply - In 2008, our Distribution segment purchased 182 Bcf of natural gas supply. Our gas supply
portfolio consists of long-term, seasonal and short-term contracts from a diverse group of suppliers. These contracts are awarded through
competitive bid processes to ensure reliable and competitively priced gas supply. Our Distribution segment’s natural gas supply is purchased
from a combination of direct wellhead production, natural gas processing plants, natural gas marketers and production companies.
We are responsible for acquiring sufficient natural gas supplies, interstate and intrastate pipeline capacity and storage capacity to meet
customer requirements. As such, we must contract for both reliable and adequate supplies and delivery capacity to our distribution system,
while considering: (i) the dynamics of the interstate and intrastate pipeline and storage capacity market; (ii) our peaking facilities and storage
and contractual commitments; and (iii) the demand characteristics of our customer base.
An objective of our supply sourcing strategy is to diversify our supply among multiple production areas and suppliers. This strategy is
designed to protect receipt of supply from being curtailed by physical interruption, possible financial difficulties of a single supplier, natural
disasters and other unforeseen force majeure events.
There is an adequate supply of natural gas available to our utility systems, and we do not anticipate problems with securing additional natural
gas supply as needed for our customers. However, if supply shortages occur, each of our LDCs has curtailment tariff provisions in place that
provide for: (i) reducing or discontinuing gas service to large industrial users; and (ii) requesting that residential and commercial customers
reduce their gas requirements to an amount essential for public health and safety. In addition, during times of critical supply problems,
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 changes in the natural gas consumption pattern of our customers that are driven by factors
other than weather. Natural gas usage per customer may decline as customers change their consumption patterns in response to: (i) more
volatile and higher natural gas prices, as discussed above; (ii) customers’ replacement of older, less efficient gas appliances with more efficient
appliances; (iii) more energy-efficient construction; and (iv) fuel switching. In each jurisdiction in which we operate, changes in customer
usage profiles have been reflected in recent rate case proceedings where rates have been adjusted to reflect current customer usage.
In December 2007, Oklahoma Natural Gas was authorized by the OCC to implement a natural gas hedging program as a three-year pilot
program, with up to $10 million per year in hedge costs to be recovered from customers. Kansas Gas Service has a natural gas hedging
program in place, subject to annual KCC approval, which is designed to reduce volatility in the natural gas price paid by consumers. The
costs of this program are borne by the Kansas Gas Service customers. Texas Gas Service also has a natural gas hedging program for certain of
its jurisdictions.
In managing our gas supply portfolios, we partially mitigate gas price volatility using a combination of financial derivatives, the triggering of
forward prices on certain gas supply contracts, and injecting gas into leased storage capacity. Our Distribution segment does not utilize
financial derivatives for speculative purposes, nor does it have trading operations. To further mitigate gas price volatility, we utilize 38.3 Bcf of
leased storage capacity, which allows gas to be purchased during the off-peak season and stored for use in the winter periods.
Demand - See discussion below under “Seasonality” and “Competition” for factors affecting demand.
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Seasonality - Natural gas sales to residential and commercial customers are seasonal, as a substantial portion of their natural gas is used for
space heating. Accordingly, the volume of natural gas sales is normally higher during the heating season (November through March) than in
other months of the year. The sales effect resulting from weather that is above or below normal is substantially offset through weather
normalization adjustments (WNA), which are now approved by the regulatory authorities for all of our Oklahoma and Kansas service
territories. WNA allows us to increase customer billing to offset lower gas usage when weather is warmer than normal and decrease customer
billing to offset higher gas usage when weather is colder than normal.
Approximately 94 percent of Texas Gas Service’s revenues, including Austin and Galveston, are protected from abnormal weather due to a
higher customer charge or WNA clauses. A higher customer charge is included in the authorized rate design for the jurisdictions of El Paso,
north Texas, Rio Grande Valley and Port Arthur to protect customers from abnormal rate fluctuation due to weather.
Competition - We can face competition based on customers’ preference for natural gas compared with other energy products, and the
comparative prices of those products. The most significant product competition occurs between natural gas and electricity in the residential
and small commercial markets. We compete for space heating, water heating, cooking and other general energy needs. Customers and
builders typically make the decision for the type of equipment to install at initial installation and use the chosen energy source for the life of
the equipment. The markets in our service territories have become increasingly competitive. Changes in the competitive position of natural
gas relative to electricity and other energy products have the potential of causing a decline in the number of future natural gas customers.
We believe that we must maintain a competitive advantage in order to retain our customers, and, accordingly, we focus on providing safe,
reliable, efficient service and controlling costs. Our Distribution segment is subject to competition from other pipelines for our existing
industrial load. Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service compete for service to large industrial and commercial
customers, and competition has and may continue to impact margins.
Under our transportation tariffs, qualifying industrial and commercial customers are able to purchase their natural gas commodity from the
supplier of their choice and have us transport it for a fee. A portion of transportation services provided is at negotiated rates that are
generally 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. Increased competition could potentially lower these rates. Texas Gas
Service files all negotiated transportation service contracts under a separate, confidential tariff at the RRC.
Government Regulation - Rates charged by our Distribution segment for natural gas 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 and all appellate matters are subject to
regulatory oversight by the RRC. Natural gas purchase costs are included in the Purchased Gas Adjustment (PGA) clause rate that is billed to
customers. Our distribution companies do not make a profit on the cost of gas. Other changes in costs must be recovered through periodic
rate adjustments approved by the OCC, KCC, RRC and various municipalities in Texas. See page 49 for a detailed description of our various
regulatory initiatives.
Oklahoma Natural Gas has settled all known claims arising out of long-term gas supply contracts containing “take-or-pay” provisions that
purport to require us to pay for volumes of natural gas contracted for but not taken. The OCC has previously authorized recovery of the
accumulated settlement costs over a 20-year period expiring in 2014, or approximately $7.0 million annually, through a combination of a
surcharge from customers, revenue from transportation under Section 311(a) of the Natural Gas Policy Act and other intrastate transportation
revenues.
Additionally, the operations of our assets are regulated by various state and federal government agencies. See further discussion in the
“Environmental and Safety Matters” section.
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Energy Services
Business Strategy - Our Energy Services segment utilizes our network of contracted gas supply and leased transportation and storage assets
to provide premium services to our customers. The asset positions afford us the flexibility to develop innovative, customer-specific demand
delivery services for those we serve, at a competitive cost. With these services and a focus on customer relationships, we expect to attract
new customers and retain existing customers that generate recurring margins.
We follow a strategy of optimizing our storage and cross-regional transportation capacity through the application of market knowledge and
effective risk management. We maximize value by actively hedging the time and locational spread risks that are inherent to storage and
transportation contracts and will pursue hedging strategies that effectively mitigate these risks. At the same time, we capitalize on
opportunities created by market volatility, weather-related events, supply-demand imbalances and market liquidity inefficiency, which allows
us to capture additional margin. Using market information, we manage these asset-based positions and seek to provide incremental margin in
our trading portfolio.
Through our wholesale marketing and risk management capabilities, we are able to be a full-service provider in our retail operations. We are
able to offer a broad range of products and are expanding our markets. We plan to grow our retail business through internal growth initiatives,
as well as expansion into areas that allow retail unbundling. We manage the commodity price and volumetric risk in these operations through
a variety of risk management and hedging activities.
It is our intention to minimize the mark-to-market earnings impact that our forward hedges have on current period earnings. When possible, we
implement effective hedging strategies using derivative instruments that qualify as hedges under Statement 133, “Accounting for Derivative
Instruments and Hedging Activities,” (Statement 133).
Our Energy Services segment requires working capital to purchase natural gas inventory and to meet cash collateral requirements associated
with our risk management activities. Our inventory purchases and hedging strategies are implemented with consideration given to ONEOK’s
overall working capital requirements and liquidity. Restrictions on our access to working capital may impact our inventory purchases and risk
management activities, which could impact our results.
We are assessing the ongoing capital requirements of the wholesale energy business, which includes evaluating our contracted storage and
transportation. This review is focused on ensuring our contracted assets continue to be aligned with our key strategy of providing customer-
specific premium delivery services that generate recurring demand revenues and margins.
Description of Business - Our Energy Services segment’s primary focus is to create value for our customers by delivering physical natural gas
products and risk management services through our network of contracted transportation and storage capacity and natural gas supply. These
services include meeting our customers’ baseload, swing and peaking natural gas commodity requirements on a year-round basis. Our
contracted storage and transportation capacity connects major supply and demand centers throughout the United States and into
Canada. With these contracted assets, our business strategies include identifying, developing and delivering specialized premium products
and services valued by our customers, which are primarily LDCs, electric utilities, and commercial and industrial end users. Our storage and
transportation capacity allows us opportunities to optimize value through our application of market knowledge and risk management skills.
We actively manage the commodity price and volatility risks associated with providing energy risk management services to our customers by
executing derivative instruments in accordance with the parameters established in our commodity risk management policy. The derivative
instruments consist of over-the-counter transactions such as forward, swap and option contracts, and NYMEX futures and option contracts.
Numerous risk management opportunities and operational strategies exist that can be implemented through the use of storage facilities and
transportation capacity. We utilize our industry knowledge and expertise in order to capitalize on opportunities that are provided through
market volatility. We utilize our experience to optimize the value of our contracted assets, and we use our risk management and marketing
capabilities to both manage risk and to generate additional margins. We apply a combination of cash flow and fair value hedge accounting
when implementing hedging strategies that take advantage of favorable market conditions. See Note D of the Notes to Consolidated Financial
Statements in this Annual Report on Form 10-K for additional information. Additionally, certain non-trading transactions, which are economic
hedges of our accrual transactions, such as our storage and transportation contracts, will not qualify for hedge accounting treatment. These
economic hedges receive mark-to-market accounting treatment, as they are derivative contracts and are not designated as part of a hedge
relationship. As a result, the underlying risk being hedged receives accrual accounting treatment, while we use
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mark-to-market accounting treatment for the economic hedges. We cannot predict the earnings fluctuations from mark-to-market accounting,
and the impact on earnings could be material.
Our working capital requirements related to our inventory in storage peaked in August 2008, with 61.0 Bcf valued at $614.6 million; this balance
had decreased to $451.7 million by December 31, 2008. During September 2008, we impaired our inventory value; were it not for this
impairment, our highest inventory balance would have been in November 2008 with 84.3 Bcf in storage. In addition, margin requirements can
result in increased working capital requirements. During 2008, our margin requirements with counterparties ranged from zero to $378 million.
Market Conditions and Seasonality - Supply - During periods of high natural gas demand, we utilize storage capacity to supplement natural
gas supply volumes to meet our peak day demand obligations or market needs.
Demand - Demand met by our swing and peaking natural gas requirements contracts in our wholesale operation is driven by the extent to
which temperatures vary from normal levels. A significant portion of this business is contracted during the winter period of November
through March. Our retail business’ demand for natural gas is primarily driven by the use of space heating and is significantly impacted by
temperature variations.
Seasonality - Due to seasonality of natural gas consumption, storage withdrawals and demand for our products and services, earnings are
normally higher during the winter months than the summer months. Our Energy Services segment’s margins are subject to fluctuations during
the year, primarily due to the impact certain seasonal factors have on sales volumes and the price of natural gas. Natural gas sales volumes are
typically higher in the winter heating months than in the summer months, reflecting increased demand due to greater heating requirements and,
typically, higher natural gas prices.
Competition - The recent market conditions affecting credit and liquidity have impacted competition by causing some of our competitors,
including financial institutions, to either exit the business or scale back their operations. In response to a competitive marketing environment,
our strategy is to concentrate our efforts on providing reliable service during peak demand periods and capturing opportunities created by
short-term pricing volatility. We can effectively compete in the market by utilizing our leased storage and transportation assets. We continue
to focus on building and strengthening supplier and customer relationships to execute our strategy and increase our market presence.
Other
Description of Business - The primary companies in our Other segment include ONEOK Leasing Company and ONEOK Parking Company,
L.L.C.
Through ONEOK Leasing Company and ONEOK Parking Company, L.L.C., we own a parking garage and an office building (ONEOK Plaza) in
downtown Tulsa, Oklahoma, where our headquarters are located. ONEOK Leasing Company leases excess office space to others and operates
our headquarters office building. ONEOK Parking Company, L.L.C. owns and operates a parking garage adjacent to our headquarters.
In July 2007, ONEOK Leasing Company gave notice of its intent to exercise its option to purchase ONEOK Plaza on or before the end of the
lease term that was set to expire on September 30, 2009. In March 2008, ONEOK Leasing Company, purchased ONEOK Plaza for a total
purchase price of approximately $48 million, which included $17.1 million for the present value of the remaining lease payments and $30.9
million for the base purchase price.
ENVIRONMENTAL AND SAFETY MATTERS
Information about our environmental matters is included in Note K of the Notes to Consolidated Financial Statements in this Annual Report on
Form 10-K.
Pipeline Safety - We are subject to United States Department of Transportation regulations, including integrity management regulations. The
Pipeline Safety Improvement Act requires pipeline companies to perform integrity assessments on pipeline segments that pass through
densely populated areas or near specifically designated high consequence areas. To our knowledge, we are in compliance with all material
requirements associated with the various pipeline safety regulations.
Air and Water Emissions - The federal Clean Air Act, the federal Clean Water Act and analogous state laws 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
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pollutants discharged to waters of the United States and remediation of waters affected by such discharge. To our knowledge, we are in
compliance with all material requirements associated with the various regulations.
The United States Congress is actively considering legislation to reduce emissions of greenhouse gases, including carbon dioxide and
methane. In addition, state and regional initiatives to regulate greenhouse gas emissions are underway. We are monitoring federal and state
legislation to assess the potential impact on our operations. Our most recent calculation of direct greenhouse gas emissions for ONEOK and
ONEOK Partners is estimated to be less than 6 million metric tons of carbon dioxide equivalents on an annual basis. We will continue efforts
to quantify our direct greenhouse gas emissions and will report such emissions as required by any mandatory reporting rule, including the
rules anticipated to be issued by the EPA in mid-2009.
Superfund - The Comprehensive Environmental Response, Compensation and Liability Act, also known as CERCLA or Superfund, imposes
liability, without regard to fault or the legality of the original act, on certain classes of persons who contributed to the release of a hazardous
substance into the environment. These persons include the owner or operator of a facility where the release occurred and 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.
Chemical Site Security - The United States Department of Homeland Security (Homeland Security) released an interim rule in April 2007 that
requires companies to provide reports on sites where certain chemicals, including many hydrocarbon products, are stored. We completed the
Homeland Security assessments and our facilities were subsequently assigned to one of four risk-based tiers ranging from high (Tier 1) to low
(Tier 4) risk, or not tiered at all due to low risk. A majority of our facilities were not tiered. We are waiting for Homeland Security’s analysis to
determine if any of the tiered facilities will require Site Security Plans and possible physical security enhancements.
Climate Change - Our environmental and climate change strategy focuses on taking steps to minimize the impact of our operations on the
environment. These strategies include: (i) developing and maintaining an accurate greenhouse gas emissions inventory, according to rules
anticipated to be issued by the EPA in mid-2009; (ii) improving the efficiency of our various pipelines, natural gas processing facilities and
natural gas liquids fractionation facilities; (iii) following developing technologies for emission control; (iv) following developing technologies
to capture carbon dioxide to keep it from reaching the atmosphere; and (v) analyzing options for future energy investment.
Currently, certain subsidiaries of ONEOK Partners participate in the Processing and Transmission sectors and LDCs in our Distribution
segment participate in the Distribution sector of the EPA’s Natural Gas STAR Program to voluntarily reduce methane emissions. A subsidiary
in our ONEOK Partners’ segment was honored in 2008 as the “Natural Gas STAR Gathering and Processing Partner of the Year” for its efforts
to positively address environmental issues through voluntary implementation of emission-reduction opportunities. In addition, we continue
to focus on maintaining low rates of lost-and-unaccounted-for methane gas through expanded implementation of best practices to limit the
release of methane during pipeline and facility maintenance and operations. Our most recent calculation of our annual lost-and-unaccounted-
for natural gas, for all of our business operations, is less than 1 percent of total throughput.
EMPLOYEES
We employed 4,742 people at January 31, 2009, including 739 people employed by Kansas Gas Service, who were subject to collective
bargaining contracts. The following table sets forth our contracts with collective bargaining units at January 31, 2009.
Union Employees Contract Expires

United Steelworkers of America 414 June 30, 2009
International Union of Operating Engineers 13 June 30, 2009
International Brotherhood of Electrical Workers 312 June 30, 2010
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EXECUTIVE OFFICERS
All executive officers are elected at the annual meeting of our Board of Directors and serve for a period of one year or until successors are duly
elected. Our executive officers listed below include the officers who have been designated by our Board of Directors as our Section 16
executive officers.
Name and Position Age Business Experience in Past Five Years

John W. Gibson 56 2007 to present Chief Executive Officer
Chief Executive Officer 2006 to present Member of the Board of Directors
and Member of the Board of Directors 2006 President and Chief Operating Officer of ONEOK Partners, L.P.
2005 to 2006 President, ONEOK Energy Companies
2000 to 2005 President, Energy
Jim Kneale 57 2007 to present President and Chief Operating Officer
Executive Vice President - Finance and Administration and Chief Financial
President and Chief Operating Officer 2004 to 2006 Officer
2001 to 2004 Senior Vice President, Treasurer and Chief Financial Officer
Curtis L. Dinan 41 2007 to present Senior Vice President, Chief Financial Officer and Treasurer
Senior Vice President, 2004 to 2006 Senior Vice President and Chief Accounting Officer
Chief Financial Officer and Treasurer 2004 Vice President and Chief Accounting Officer
2002 to 2004 Assurance and Business Advisory Partner, Grant Thornton, LLP
John R. Barker 61 2004 to present Senior Vice President and General Counsel
Senior Vice President and 1994 to 2004 Stockholder, President and Director, Gable & Gotwals
General Counsel
Caron A. Lawhorn 47 2007 to present Senior Vice President and Chief Accounting Officer
Senior Vice President and 2005 to 2006 Senior Vice President, Financial Services and Treasurer
Chief Accounting Officer 2004 to 2005 Vice President and Controller
2003 to 2004 Vice President of Audit and Risk Control
No family relationships exist between any of the executive officers, nor is there any arrangement or understanding between any executive
officer and any other person pursuant to which the officer was selected.
AVAILABLE INFORMATION
We make available on our Web site copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K,
amendments to those reports filed or furnished to the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act and reports of holdings of
our securities filed by our officers and directors under Section 16 of the Exchange Act as soon as reasonably practicable after filing such
material electronically or otherwise furnishing it to the SEC. Copies of our Code of Business Conduct, Corporate Governance Guidelines and
Director Independence Guidelines are also available on our Web site, and we will make available, free of charge, copies of these documents
upon request. However, our Web site and any contents thereof are not incorporated by reference into this document.
ITEM 1A. RISK FACTORS
Our investors should consider the following risks that could affect us and our business. Although we have tried to discuss key factors, our
investors need to be aware that other risks may prove to be important in the future. New risks may emerge at any time, and we cannot predict
such risks or estimate the extent to which they may affect our financial performance. Investors should carefully consider the following
discussion of risks and the other information included or incorporated by reference in this Annual Report on Form 10-K, including “Forward-
Looking Statements,” which are included in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operation.
RISK FACTORS INHERENT IN OUR BUSINESS
Current levels of market volatility are unprecedented.
The capital and credit markets have been experiencing volatility and disruption. During the fourth quarter of 2008, the volatility and disruption
reached unprecedented levels. In many cases, the capital markets have exerted downward pressure on equity prices and reduced the credit
capacity for certain companies. Our ability to grow could be constrained if we do not have regular access to the capital and credit markets. If
current levels of market disruption and volatility continue or worsen, our access to capital and credit markets could be disrupted, making
growth through acquisitions and development projects difficult or impractical to pursue until such time as markets stabilize.
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Our operating results may be adversely affected by unfavorable economic and market conditions.
Economic conditions worldwide have from time to time contributed to slowdowns in the oil and gas industry, as well as in the specific
segments and markets in which we operate, resulting in reduced demand and increased price competition for our products and services. Our
operating results in one or more geographic regions may also be affected by uncertain or changing economic conditions within that
region. Volatility in commodity prices might have an impact on many of our customers, which, in turn, could have a negative impact on their
ability to meet their obligations to us. If global economic and market conditions (including volatility in commodity markets), or economic
conditions in the United States or other key markets, remain uncertain or persist, spread or deteriorate further, we may experience material
impacts on our business, financial condition and results of operations.
The recent downturn in the credit markets has increased the cost of borrowing and has made financing difficult to obtain, each of which may
have a material adverse effect on our results of operations and business.
Recent events in the financial markets have had an adverse impact on the credit markets. As a result, credit has become more expensive and
difficult to obtain. Some lenders are imposing more stringent restrictions on the terms of credit and there may be a general reduction in the
amount of credit available in the markets in which we conduct business. The negative impact of the tightening of the credit markets may have
a material adverse effect on us resulting from, but not limited to, an inability to obtain credit necessary to expand facilities or finance the
acquisition of assets on favorable terms, if at all, increased financing costs or financing with increasingly restrictive covenants.
Our cash flow depends heavily on the earnings and distributions of ONEOK Partners.
Our partnership interest in ONEOK Partners is one of our largest cash-generating assets. Therefore, our cash flow is heavily dependent upon
the ability of ONEOK Partners to make distributions to its partners. A significant decline in ONEOK Partners’ earnings and/or cash
distributions would have a corresponding negative impact on us. For information on the risk factors inherent in the business of ONEOK
Partners, see the section below entitled “Risk Factors Related to ONEOK Partners’ Business” and the ONEOK Partners 2008 Annual Report on
Form 10-K.
Some of our nonregulated businesses have a higher level of risk than our regulated businesses.
Some of our nonregulated operations, which include ONEOK Partners’ gathering and processing, natural gas liquids gathering and
fractionation, and our energy services businesses, have a higher level of risk than our regulated operations, which include our distribution and
ONEOK Partners’ natural gas and natural gas liquids pipelines businesses. We and ONEOK Partners expect to continue investing in natural
gas and natural gas liquids projects and other related projects, some or all of which may involve nonregulated businesses or assets. These
projects could involve risks associated with operational factors, such as competition and dependence on certain suppliers and customers, and
financial, economic and political factors, such as rapid and significant changes in commodity prices, the cost and availability of capital and
counterparty risk, including the inability of a counterparty, customer or supplier to fulfill a contractual obligation.
Our LDCs have recorded certain assets that may not be recoverable from our customers.
Accounting policies for our LDCs permit certain assets that result from the regulatory process to be recorded on our balance sheet 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.
Terrorist attacks aimed at our facilities could adversely affect our business.
Since the September 11, 2001, terrorist attacks, the United States government has issued warnings that energy assets, specifically the nation’s
pipeline infrastructure, may be future targets of terrorist organizations. These developments may subject our operations to increased
risks. Any future terrorist attack that may target our facilities, those of our customers and, in some cases, those of other pipelines, could have
a material adverse effect on our business.
Our businesses are subject to market and credit risks.
We are exposed to market and credit risks in all of our operations. To minimize the risk of commodity price fluctuations, we periodically enter
into derivative transactions to hedge anticipated purchases and sales of natural gas, NGLs, crude oil, fuel requirements and firm transportation
commitments. Interest-rate swaps are also used to manage interest-rate risk. Currency
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swaps are used to mitigate unexpected changes that may occur in anticipated revenue streams of our Canadian natural gas sales and
purchases driven by currency rate fluctuations. However, financial derivative instrument contracts do not eliminate the risks. Specifically,
such risks include commodity price changes, market supply shortages, interest rate changes and counterparty default. The impact of these
variables could result in our inability to fulfill contractual obligations, significantly higher energy or fuel costs relative to corresponding sales
contracts, or increased interest expense.
We are subject to the risk of loss resulting from nonpayment and/or nonperformance by customers of our Energy Services segment. The
customers of our Energy Services segment are predominantly LDCs, industrial customers, natural gas producers and marketers that may
experience deterioration of their financial condition as a result of changing market conditions or financial difficulties that could impact their
creditworthiness or ability to pay for our services. Although we attempt to obtain adequate security for these risks, if we fail to adequately
assess the creditworthiness of existing or future customers, unanticipated deterioration in their creditworthiness and any resulting
nonpayment and/or nonperformance could adversely impact results of operations for our Energy Services segment. In addition, if any of our
Energy Services segment’s customers filed for bankruptcy protection, we may not be able to recover amounts owed, which would negatively
impact the results of operations for our Energy Services segment.
Increased competition could have a significant adverse financial impact on us.
The natural gas and natural gas liquids industries are expected to remain highly competitive, resulting from deregulation and other initiatives
being pursued by the industry and regulatory agencies that allow customers increased options for energy supplies and service. The demand
for natural gas and NGLs is primarily a function of commodity prices, including prices for alternative energy sources, customer usage rates,
weather, economic conditions and service costs. Our ability to compete also depends on a number of other factors, including competition
from other pipelines for our existing load, the efficiency, quality and reliability of the services we provide, and competition for throughput for
our gathering systems and plants.
We cannot predict when we will be subject to changes in legislation or regulation, nor can we predict the impact of these changes on our
financial position, results of operations or cash flows. Although we believe our businesses are positioned to compete effectively in the
energy market, there are no assurances that this will be true in the future.
We may not be able to successfully make additional strategic acquisitions or integrate businesses we acquire into our operations.
Our ability to successfully make strategic acquisitions and investments will depend on: (i) the extent to which acquisitions and investment
opportunities become available; (ii) our success in bidding for the opportunities that do become available; (iii) regulatory approval, if required,
of the acquisitions on favorable terms; and (iv) our access to capital, including our ability to use our equity in acquisitions or investments, and
the terms upon which we obtain capital. If we are unable to make strategic investments and acquisitions, we may be unable to grow. If we are
unable to successfully integrate new businesses into our operations, we could experience increased costs and losses on our investments.
Acquisitions that appear to be accretive may nevertheless reduce our cash from operations on a per share basis.
Any acquisition involves potential risks that may include, among other things:
•mistaken assumptions about volumes, revenues and costs, including synergies;
•an inability to successfully integrate the businesses we acquire;
•decrease in our liquidity as a result of our using a significant portion of our available cash or borrowing capacity to finance the
acquisition;
•a significant increase in our interest expense or financial leverage if we incur additional debt to finance the acquisition;
•the assumption of unknown liabilities for which we are not indemnified or for which our indemnity is inadequate;
•an inability to hire, train or retain qualified personnel to manage and operate the acquired business and assets;
•limitations on rights to indemnity from the seller;
•mistaken assumptions about the overall costs of equity or debt;
•the diversion of management’s and employees’ attention from other business concerns;
•unforeseen difficulties operating in new product areas or new geographic areas;
•increased regulatory burdens;
•customer or key employee losses at an acquired business; and
•increased regulatory requirements.
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If we consummate any future acquisitions, our capitalization and results of operations may change significantly, and investors will not have
the opportunity to evaluate the economic, financial and other relevant information that we will consider in determining the application of these
funds and other resources.
Any reduction in our credit ratings could materially and adversely affect our business, financial condition, liquidity and results of
operations.
Our long-term senior unsecured debt has been assigned an investment-grade rating by S&P of “BBB” (Stable) and Moody’s of “Baa2”
(Stable). However, we cannot provide assurance that any of our current ratings will remain in effect for any given period of time or that a
rating will not be lowered or withdrawn entirely by a rating agency if, in its judgment, circumstances in the future so warrant. Specifically, if
S&P or Moody’s were to downgrade our long-term rating, particularly below investment grade, our borrowing costs would increase, which
would adversely affect our financial results, and our potential pool of investors and funding sources could decrease. If S&P or Moody’s were
to downgrade the long-term ratings of ONEOK Partners below investment grade, ONEOK Partners would, under certain circumstances, be
required to offer to repurchase certain of its senior notes. Further, if our short-term ratings were to fall below A-2 (capacity to meet its financial
commitment on the obligation is satisfactory) or P-2 (strong ability to repay short-term debt obligations), the current ratings assigned by S&P
and Moody’s, respectively, it could significantly limit our access to the commercial paper market. Any such downgrade of our long- or short-
term ratings could increase our cost of capital and reduce the availability of capital and, thus, have a material adverse effect on our business,
financial condition, liquidity and results of operations. Ratings from credit agencies are not recommendations to buy, sell or hold our
securities. Each rating should be evaluated independently of any other rating.
A downgrade in our credit ratings below investment grade would negatively affect the operations of our Energy Services segment. If our
credit ratings fall below investment grade, ratings triggers and/or adequate assurance clauses in many of our financial and wholesale physical
contracts would be in effect. A ratings trigger or adequate assurance clause gives a counterparty the right to suspend or terminate the
agreement unless margin thresholds are met. The additional increase in capital required to support our Energy Services segment would
negatively impact our ability to compete, as well as our ability to actively manage the risk associated with existing storage and transportation
contracts.
Our indebtedness could impair our financial condition and our ability to fulfill our other obligations.
As of December 31, 2008, we had total indebtedness for borrowed money of approximately $3.0 billion, which excludes the debt of ONEOK
Partners. Our indebtedness could have significant consequences. For example, it could:
•make it more difficult for us to satisfy our obligations with respect to our notes and our other indebtedness due to the increased debt-
service obligations, which could in turn result in an event of default on such other indebtedness or our notes;
•impair our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions or general business
purposes;
•diminish our ability to withstand a downturn in our business or the economy;
•require us to dedicate a substantial portion of our cash flow from operations to debt service payments, reducing the availability of
cash for working capital, capital expenditures, acquisitions, or general purposes;
•limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and
•place us at a competitive disadvantage compared with our competitors that have proportionately less debt.
We are not prohibited under the indentures governing our senior notes from incurring additional indebtedness, but our debt agreements do
subject us to certain operational limitations summarized in the next paragraph. If we incur significant additional indebtedness, it could worsen
the negative consequences mentioned above and could adversely affect our ability to repay our other indebtedness.
Our revolving debt agreements with banks contain provisions that restrict our ability to finance future operations or capital needs or to expand
or pursue our business activities. For example, certain of these agreements contain provisions that, among other things, limit our ability to
make loans or investments, make material changes to the nature of our business, merge, consolidate or engage in asset sales, grant liens, or
make negative pledges. Certain of these agreements also require us to maintain certain financial ratios, which limits the amount of additional
indebtedness we can incur. These restrictions could result in higher costs of borrowing and impair our ability to generate additional
cash. Future financing agreements we may enter into may contain similar or more restrictive covenants.
If we are unable to meet our debt-service obligations, we could be forced to restructure or refinance our indebtedness, seek additional equity
capital or sell assets. We may be unable to obtain financing or sell assets on satisfactory terms, or at all.
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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 federal, 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 customer service and the rates that we can charge customers. Federal,
state and local agencies also have jurisdiction over many of our other activities, including regulation by the FERC of our storage and interstate
pipeline assets. The profitability of our regulated operations is dependent on our ability to pass costs related to providing energy and other
commodities through to our customers. The regulatory environment applicable to our regulated businesses 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 operating results. Changes in
regulations or the imposition of additional regulations could have an adverse impact on our business, financial condition and results of
operations.
Our business is subject to increased regulatory oversight and potential penalties.
The natural gas industry historically has been heavily regulated; therefore, there is no assurance that a more stringent regulatory approach will
not be pursued by the FERC and United States Congress, especially in light of previous market power abuse by certain companies engaged in
interstate commerce. In response to this issue, the United States Congress, in the Energy Policy Act of 2005 (EPACT), developed
requirements intended to ensure that the energy market is not impacted by the exercise of market power or manipulative conduct. The FERC
then adopted the Market Manipulation Rules to implement the authority granted under EPACT. These rules are intended to prohibit fraud and
manipulation and are subject to broad interpretation. EPACT also gave the FERC increased penalty authority for violations of these rules, as
well as other FERC rules.
Demand for services of our Distribution and Energy Services segments and for certain of ONEOK Partners’ products is highly weather
sensitive and seasonal.
The demand for natural gas and for certain of ONEOK Partners’ products, such as propane, is weather sensitive and seasonal, with a
significant portion of revenues derived from sales to retail marketers for heating during the winter months. Weather conditions directly
influence the volume of, among other things, natural gas and propane delivered to customers. Deviations in weather from normal levels and
the seasonal nature of certain of our segments’ business can create large variations in earnings and short-term cash requirements.
We are subject to environmental regulations that could be difficult and costly to comply with.
We are subject to multiple environmental laws and regulations affecting many aspects of present and future operations, including air
emissions, water quality, wastewater discharges, solid and hazardous wastes and hazardous material and substance management. These laws
and regulations generally require us to obtain and comply with a wide variety of environmental registrations, licenses, permits, inspections and
other approvals. Failure to comply with these laws, regulations, permits and licenses may expose us to fines, penalties and/or interruptions in
our operations that could be material to the results of operations. If a leak or spill of hazardous substance occurs from our lines or facilities, in
the process of transporting natural gas or NGLs, or at any facility that we own, operate or otherwise use, we could be held jointly and severally
liable for all resulting liabilities, including investigation and clean-up costs, which could materially affect our results of operations and cash
flows. In addition, emission controls required under the federal Clean Air Act and other similar federal and state laws could require unexpected
capital expenditures at our facilities. We cannot assure that existing environmental 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, particularly if those costs are not fully recoverable from customers, could have a material adverse effect on our business, financial
condition and results of operations. For further discussion on this topic, see Note K of the Notes to Consolidated Financial Statements in this
Annual Report on Form 10-K.
We are subject to risks that could limit our access to capital, thereby increasing our costs and adversely affecting our results of operations.
We have grown rapidly in the last several years as a result of acquisitions. Further acquisitions may require additional external capital. If we
are not able to access capital at competitive rates, our strategy of enhancing the earnings potential of our existing assets, including through
acquisitions of complementary assets or businesses, will be adversely affected. A
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number of factors could adversely affect our ability to access capital, including: (i) general economic conditions; (ii) capital market conditions;
(iii) market prices for natural gas, NGLs and other hydrocarbons; (iv) the overall health of the energy and related industries; (v) our ability to
maintain our investment-grade credit ratings; and (vi) our capital structure. Much of our business is capital intensive, and achievement of our
long-term growth targets is dependent, at least in part, upon our ability to access capital at rates and on terms we determine to be attractive. If
our ability to access capital becomes significantly constrained, our interest costs will likely increase and our financial condition and future
results of operations could be significantly harmed.
Energy efficiency and technological advances may affect the demand for natural gas and adversely affect our operating results.
The national trend toward increased conservation and technological advances, including installation of improved insulation and the
development of more efficient furnaces and other heating devices, may decrease the demand for natural gas by retail customers. More strict
conservation measures in the future or technological advances in heating, conservation, energy generation or other devices could adversely
affect 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.
We have a defined benefit pension plan for certain employees and postretirement welfare plans that provide postretirement medical and life
insurance benefits to certain employees who retire with at least five years of service. 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, cash contributions to our pension plans may be required.
Our business could be adversely affected by strikes or work stoppages by our unionized employees.
As of January 31, 2009, 739 of our 4,742 employees were 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 future work
stoppage could, depending on the operations and the length of the work stoppage, have a material adverse effect on our business, financial
condition and results of certain operations.
We may face significant costs to comply with the regulation of greenhouse gas emissions.
Global warming is a significant concern for the energy industry. Various federal and state legislative proposals have been introduced to
regulate the emission of greenhouse gases, particularly carbon dioxide and methane, and the United States Supreme Court has ruled that
carbon dioxide is a pollutant subject to regulation by the EPA. In addition, there have been international efforts seeking legally binding
reductions in emissions of greenhouse gases.
We believe it is likely that future governmental legislation and/or regulation may require us either to limit greenhouse gas emissions from our
operations or to purchase allowances for such emissions. However, we cannot predict precisely what form these future regulations will take,
the stringency of the regulations or when they will become effective. Several bills have been introduced in the United States Congress that
would compel carbon dioxide emission reductions. Previously considered proposals have included, among other things, limitations on the
amount of greenhouse gases that can be emitted (so called “caps”) together with systems of emissions allowances. This type of system could
require us to reduce emissions, even though the technology is not currently available for efficient reduction, or to purchase allowances for
such emissions. Emissions also could be taxed independently of limits.
In addition to activities on the federal level, state and regional initiatives could also lead to the regulation of greenhouse gas emissions sooner
and/or independent of federal regulation. These regulations could be more stringent than any federal legislation that is adopted.
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Future legislation and/or regulation designed to reduce greenhouse gas emissions could make some of our activities uneconomic to maintain
or operate and could affect future results of operations, cash flows or financial condition if such costs are not recovered through regulated
rates.
We continue to monitor legislative and regulatory developments in this area. Although we expect the regulation of greenhouse gas emissions
may have a material impact on our operations and rates, we believe it is premature to attempt to quantify the potential costs of the impacts.
We do not fully hedge against price changes in commodities. This could result in decreased revenues and increased costs, thereby
resulting in lower margins and adversely affecting our results of operations.
Certain of our nonregulated businesses are exposed to market risk and the impact of market price fluctuations of natural gas, NGLs and crude
oil. Market risk refers to the risk of loss of cash flows and future earnings arising from adverse changes in commodity energy prices. Our
Energy Services segment’s primary exposures arise from fixed-price physical purchase or sale agreements that extend for periods of up to five
years and natural gas in storage. Our ONEOK Partners segment’s primary exposures arise from commodity prices with respect to processing
agreements and the differentials between NGL and natural gas prices with respect to natural gas and NGL transportation, fractionation and
exchange agreements, as well as the differential between the individual NGL products and the differentials in natural gas and NGLs in storage
utilized in our operations. Our ONEOK Partners and Energy Services segments are also exposed to the risk of changing prices or the cost of
transportation resulting from purchasing natural gas or NGLs at one location and selling it at another (referred to as basis risk). To minimize
the risk from market price fluctuations of natural gas, NGLs and crude oil, we use commodity derivative instruments such as futures contracts,
swaps and options to manage market risk of existing or anticipated purchases and sales of natural gas, NGLs and crude oil. We adhere to
policies and procedures that monitor our exposure to market risk from open positions. However, we do not fully hedge against commodity
price changes, and therefore, we retain some exposure to market risk. Accordingly, any adverse changes to commodity prices could result in
decreased revenue and increased costs.
Our Distribution segment uses storage to minimize the volatility of natural gas costs for our customers by storing natural gas in periods of low
demand for consumption in peak demand periods. In addition, various natural gas supply contracts allow us the option to convert index-
based purchases to fixed prices. Also, we use derivative instruments to hedge the cost of anticipated natural gas purchases during the winter
heating months to protect customers from upward volatility in the market price of natural gas.
Federal, state and local jurisdictions may challenge our tax return positions.
The positions taken in our federal and state tax return filings 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 belief that our tax return positions are fully supportable, certain positions may be successfully challenged by
federal, state and local jurisdictions.
Although we control ONEOK Partners, we may have conflicts of interest with ONEOK Partners which could subject us to claims that we
have breached our fiduciary duty to ONEOK Partners and its unitholders.
We are the sole general partner and own 47.7 percent of ONEOK Partners. Conflicts of interest may arise between us and ONEOK Partners
and its unitholders. In resolving these conflicts, we may favor our own interests and the interests of our affiliates over the interests of ONEOK
Partners and its unitholders as long as the resolution does not conflict with the ONEOK Partners’ partnership agreement or our fiduciary
duties to ONEOK Partners and its unitholders.
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 are affected by climate change, customers’ energy
use could increase or decrease depending on the duration and magnitude of any changes. Increased energy use due to weather changes may
require us to invest in more pipeline and other infrastructure to serve increased demand. A decrease in energy use due to weather changes
may affect our financial condition, through decreased revenues. Extreme weather 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 service territory
could also have an impact on our revenues. Severe weather impacts our service territories primarily through hurricanes, thunderstorms,
tornadoes 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
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mitigating these physical risks. To the extent financial markets view climate change and emissions of greenhouse gases as a financial risk, this
could negatively affect our ability to access capital markets or cause us to receive less favorable terms and conditions in future financings.
We may be subject to legislative and regulatory responses to climate change, with which compliance could be difficult and costly.
Legislative and regulatory responses related to climate change create financial risk. Increased public awareness and concern may result in
more state, regional and/or federal requirements to reduce or mitigate the emission of greenhouse gases. Numerous states have announced or
adopted programs to stabilize and reduce greenhouse gases and federal legislation has been introduced in both houses of the United States
Congress. Our pipelines, natural gas processing facilities and natural gas liquids fractionation facilities will potentially be subject to regulation
under climate change policies introduced at either the state or federal level within the next few years. We may not be able to pass on the
higher costs to our customers or recover all costs related to complying with climate change regulatory requirements, which could have a
material adverse effect on our results of operations, cash flows or financial condition.
RISK FACTORS RELATED TO ONEOK PARTNERS’ BUSINESS
The volatility of natural gas, crude oil and NGL prices could adversely affect ONEOK Partners’ cash flow.
A significant portion of ONEOK Partners’ revenues are derived from the sale of commodities received as payment for its natural gas gathering
and processing services, for transportation and storage of natural gas and NGLs, and for the fractionation of NGLs. As a result, ONEOK
Partners is sensitive to commodity price fluctuations. Commodity prices have been volatile and are likely to continue to be so in the
future. Recent significant and steep declines in commodity prices and compressions in commodity price differentials could have material
negative impacts on ONEOK Partners’ financial results. The prices ONEOK Partners receives for its commodities are subject to wide
fluctuations in response to a variety of factors beyond ONEOK Partners’ control, including the following:
•overall domestic and global economic conditions;
•relatively minor changes in the supply of, and demand for, domestic and foreign energy;
•market uncertainty;
•the availability and cost of transportation capacity;
•the level of consumer product demand;
•geopolitical conditions impacting supply and demand for natural gas and crude oil;
•weather conditions;
•domestic and foreign governmental regulations and taxes;
•the price and availability of alternative fuels;
•speculation in the commodity futures markets;
•overall domestic and global economic conditions;
•the price of natural gas, crude oil, NGL and liquefied natural gas imports; and
•the effect of worldwide energy conservation measures.
These external factors and the volatile nature of the energy markets make it difficult to reliably estimate future prices of commodities and the
impact commodity price fluctuations have on our customers and their need for our services. As commodity prices decline, ONEOK Partners is
paid less for its commodities, thereby reducing its cash flow. In addition, production and related volumes could also decline.
ONEOK Partners’ use of financial instruments to hedge market risk may result in reduced income.
ONEOK Partners utilizes financial instruments to mitigate its exposure to interest rate and commodity price fluctuations. Hedging instruments
that are used to reduce its exposure to interest rate fluctuations could expose it to risk of financial loss where it has contracted for variable-rate
swap instruments to hedge fixed-rate instruments and the variable rate exceeds the fixed rate. In addition, these hedging arrangements may
limit the benefit ONEOK Partners would otherwise receive if it has contracted for fixed-rate swap agreements to hedge variable-rate
instruments and the variable rate falls below the fixed rate. Hedging arrangements that are used to reduce ONEOK Partners’ exposure to
commodity price fluctuations may limit the benefit ONEOK Partners would otherwise receive if market prices for natural gas and NGLs exceed
the stated price in the hedge instrument for these commodities.
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ONEOK Partners’ inability to execute growth and development projects and acquire new assets could reduce cash distributions to its
unitholders and to ONEOK.
ONEOK Partners’ primary business objectives are to generate cash flow sufficient to pay quarterly cash distributions to unitholders and to
increase quarterly cash distributions over time. ONEOK Partners’ ability to maintain and grow its distributions to unitholders, including
ONEOK, depends on the growth of its existing businesses and strategic acquisitions. Accordingly, if ONEOK Partners is unable to implement
business development opportunities and finance such activities on economically acceptable terms, its future growth will be limited, which
could adversely impact its and our results of operations and cash flows.
Growing ONEOK Partners’ business by constructing new pipelines and plants or making modifications to its existing facilities subjects
ONEOK Partners to construction risks and risks that adequate natural gas or NGL supplies will not be available upon completion of the
facilities.
One of the ways ONEOK Partners intends to grow its business is through the construction of new pipelines and new gathering, processing,
storage and fractionation facilities and through modifications to ONEOK Partners’ existing pipelines and existing gathering, processing,
storage and fractionation facilities. The construction and modification of pipelines and gathering, processing, storage and fractionation
facilities requires the expenditure of significant amounts of capital, which may exceed ONEOK Partners’ estimates, and involves numerous
regulatory, environmental, political and legal uncertainties. Construction projects in ONEOK Partners’ industry may increase demand for
labor, materials and rights of way, which, may, in turn, impact ONEOK Partners’ costs and schedule. If ONEOK Partners undertakes these
projects, it may not be able to complete them on schedule or at the budgeted cost. Additionally, ONEOK Partners’ revenues may not increase
immediately upon the expenditure of funds on a particular project. For instance, if ONEOK Partners builds a new pipeline, the construction will
occur over an extended period of time, and ONEOK Partners will not receive any material increases in revenues until after completion of the
project. ONEOK Partners may have only limited natural gas or NGL supplies committed to these facilities prior to their
construction. Additionally, ONEOK Partners may construct facilities to capture anticipated future growth in production in a region in which
anticipated production growth does not materialize. ONEOK Partners may also rely on estimates of proved reserves in ONEOK Partners’
decision to construct new pipelines and facilities, which may prove to be inaccurate because there are numerous uncertainties inherent in
estimating quantities of proved reserves. As a result, new facilities may not be able to attract enough natural gas or NGLs to achieve ONEOK
Partners’ expected investment return, which could adversely affect ONEOK Partners’ results of operations and financial condition.
ONEOK Partners does not own all of the land on which its pipelines and facilities are located, which could disrupt its operations.
ONEOK Partners does not own all of the land on which certain of its pipelines and facilities are located, and is, therefore, subject to the risk of
increased costs to maintain necessary land use. ONEOK Partners obtains the rights to construct and operate certain of its pipelines and
related facilities on land owned by third parties and governmental agencies for a specific period of time. ONEOK Partners’ loss of these rights,
through its inability to renew right-of-way contracts, or increased costs to renew such rights, could have a material adverse effect on our
financial condition, results of operations and cash flows.
ONEOK Partners’ operations are subject to operational hazards and unforeseen interruptions, which could adversely affect its business and
for which ONEOK Partners may not be adequately insured.
ONEOK Partners’ operations are subject to all of the risks and hazards typically associated with the operation of natural gas and natural gas
liquids gathering and transportation pipelines, storage facilities and processing and fractionation plants. Operating risks include, but are not
limited to, leaks, pipeline ruptures, the breakdown or failure of equipment or processes, and the performance of pipeline facilities below
expected levels of capacity and efficiency. Other operational hazards and unforeseen interruptions include adverse weather conditions,
accidents, the collision of equipment with ONEOK Partners’ pipeline facilities (for example, this may occur if a third party were to perform
excavation or construction work near ONEOK Partners’ facilities) and catastrophic events such as explosions, fires, hurricanes, earthquakes,
floods or other similar events beyond ONEOK Partners’ control. It is also possible that ONEOK Partners’ infrastructure facilities could be
direct targets or indirect casualties of an act of terrorism. A casualty occurrence might result in injury or loss of life, extensive property damage
or environmental damage. Liabilities incurred and interruptions to the operation of ONEOK Partners’ pipeline caused by such an event could
reduce revenues generated by ONEOK Partners and increase expenses, thereby impairing ONEOK Partners’ ability to meet its obligations.
Insurance proceeds may not be adequate to cover all liabilities or expenses incurred or revenues lost, and ONEOK Partners is not fully insured
against all risks inherent to ONEOK Partners’ business. Additionally, in accordance with typical industry practice, ONEOK Partners does not
have any property insurance on any of our underground pipeline systems that would cover damage to such systems.
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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. For example, change in the insurance markets
subsequent to the terrorist attacks on September 11, 2001 and the hurricanes in 2005 and 2008 have made it more difficult for ONEOK Partners
to obtain certain types of coverage. Consequently, ONEOK Partners may not be able to renew existing insurance policies or procure other
desirable insurance on commercially reasonable terms, if at all. If ONEOK Partners was to incur a significant liability for which ONEOK
Partners was not fully insured, it could have a material adverse effect on ONEOK Partners’ financial position and results of
operations. Further, the proceeds of any such insurance may not be paid in a timely manner and may be insufficient if such an event were to
occur.
If the level of drilling and production in the Mid-Continent, Rocky Mountain, Texas and Gulf Coast regions substantially declines near its
assets, ONEOK Partners’ volumes and revenue could decline.
ONEOK Partners’ ability to maintain or expand its businesses depends largely on the level of drilling and production in the Mid-Continent,
Texas, Rocky Mountain and Gulf Coast regions. Drilling and production are impacted by factors beyond ONEOK Partners’ control, including:
•demand for natural gas and refinery-grade crude oil;
•producers’ desire and ability to obtain necessary permits in a timely and economic manner;
•natural gas field characteristics and production performance;
•surface access and infrastructure issues; and
•capacity constraints on natural gas, crude oil and natural gas liquids pipelines from the producing areas and ONEOK Partners’
facilities.
In addition, drilling and production may be impacted by environmental regulations governing water discharge. If the level of drilling and
production in any of these regions substantially declines, ONEOK Partners’ volumes and revenue could be reduced.
If production from the Western Canada Sedimentary Basin remains flat or declines and demand for natural gas from the Western Canada
Sedimentary Basin is greater in market areas other than the Midwestern United States, demand for ONEOK Partners’ interstate gas
transportation services could significantly decrease.
ONEOK Partners depends on natural gas supply from the Western Canada Sedimentary Basin because ONEOK Partners’ interstate pipelines
primarily transport Canadian natural gas from the Western Canada Sedimentary Basin to the Midwestern U.S. market area. If demand for
natural gas increases in Canada or other markets not served by ONEOK Partners’ interstate pipelines and production remains flat or declines,
demand for transportation service on ONEOK Partners’ interstate natural gas pipelines could decrease significantly, which could adversely
impact ONEOK Partners’ results of operations.
Pipeline integrity programs and repairs may impose significant costs and liabilities.
Pursuant to a United States Department of Transportation rule, pipeline operators were required to develop integrity management programs for
intrastate and interstate natural gas and natural gas liquids pipelines located near high consequence areas, where a leak or rupture could do
the most harm. The rule also requires operators to perform ongoing assessments of pipeline integrity; identify and characterize applicable
threats to pipeline segments that could impact a high consequence area; improve data collection, integration and analysis; repair and
remediate the pipeline as necessary; and implement preventive and mitigating actions. The results of these testing programs could cause
ONEOK Partners to incur significant capital and operating expenditures to make repairs or take remediation, preventive or mitigating actions
that are determined to be necessary.
ONEOK Partners’ regulated pipelines’ transportation rates are subject to review and possible adjustment by federal and state regulators.
ONEOK Partners’ regulated pipelines are subject to extensive regulation by the FERC and state regulatory agencies, which regulate most
aspects of ONEOK Partners’ pipeline business, including ONEOK Partners’ transportation rates. Under the Natural Gas Act, which is
applicable to interstate natural gas pipelines, and the Interstate Commerce Act, which is applicable to crude oil and natural gas liquids
pipelines, interstate transportation rates must be just and reasonable and not unduly discriminatory.
Action by the FERC or a state regulatory agency could adversely affect ONEOK Partners’ pipeline business’ ability to establish or charge
rates that would cover future increases in their costs, or even to continue to collect rates that cover current costs, including a reasonable
return. ONEOK Partners cannot assure unitholders that its pipeline systems will be able to recover all of its costs through existing or future
rates.
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ONEOK Partners’ regulated pipeline companies have recorded certain assets that may not be recoverable from its customers.
Accounting policies for FERC-regulated companies permit certain assets that result from the regulated ratemaking process to be recorded on
ONEOK Partners balance sheet that could not be recorded under GAAP for nonregulated entities. ONEOK Partners considers factors such as
regulatory changes and the impact of competition to determine the probability of future recovery of these assets. If ONEOK Partners
determines future recovery is no longer probable, ONEOK Partners would be required to write off the regulatory assets at that time.
ONEOK Partners’ operations are subject to federal and state laws and regulations relating to the protection of the environment, which may
expose it to significant costs and liabilities.
The risk of incurring substantial environmental costs and liabilities is inherent in ONEOK Partners’ business. ONEOK Partners’ operations are
subject to extensive federal, state and local laws and regulations governing the discharge of materials into, or otherwise relating to the
protection of, the environment. Examples of these laws include:
•the federal Clean Air Act and analogous state laws that impose obligations related to air emissions;
•the federal Clean Water Act and analogous state laws that regulate discharge of wastewaters from ONEOK Partners’ facilities to
state and federal waters;
•the federal Comprehensive Environmental Response, Compensation and Liability Act and analogous state laws that regulate the
cleanup of hazardous substances that may have been released at properties currently or previously owned or operated by
ONEOK Partners or locations to which ONEOK Partners has sent waste for disposal; and
•the federal Resource Conservation and Recovery Act and analogous state laws that impose requirements for the handling and
discharge of solid and hazardous waste from ONEOK Partners’ facilities.
Various governmental authorities, including the EPA, have the power to enforce compliance with these laws and regulations and the permits
issued under them. Violators are subject to administrative, civil and criminal penalties, including civil fines, injunctions or both. Joint and
several, strict liability may be incurred without regard to fault under the Comprehensive Environmental Response, Compensation and Liability
Act, Resource Conservation and Recovery Act and analogous state laws for the remediation of contaminated areas.
There is an inherent risk of incurring environmental costs and liabilities in ONEOK Partners’ business due to its handling of the products it
gathers, transports and processes, air emissions related to its operations, historical industry operations and waste disposal practices, some of
which may be material. Private parties, including the owners of properties through which ONEOK Partners’ pipeline systems pass, may have
the right to pursue legal actions to enforce compliance as well as to seek damages for non-compliance with environmental laws and regulations
or for personal injury or property damage arising from ONEOK Partners’ operations. Some sites ONEOK Partners operates are located near
current or former third-party hydrocarbon storage and processing operations, and there is a risk that contamination has migrated from those
sites to ONEOK Partners’ sites. In addition, increasingly strict laws, regulations and enforcement policies could significantly increase ONEOK
Partners’ compliance costs and the cost of any remediation that may become necessary, some of which may be material. Additional
information is included under Item 1, Business under “Environmental and Safety Matters” and in Note K of the Notes to Consolidated
Financial Statements in this Annual Report on Form 10-K.
ONEOK Partners’ insurance may not cover all environmental risks and costs or may not provide sufficient coverage in the event an
environmental claim is made against ONEOK Partners. ONEOK Partners’ business may be adversely affected by increased costs due to
stricter pollution control requirements or liabilities resulting from non-compliance with required operating or other regulatory permits. New
environmental regulations might also adversely affect ONEOK Partners’ products and activities, and federal and state agencies could impose
additional safety requirements, all of which could materially affect ONEOK Partners’ profitability.
In the competition for customers, ONEOK Partners may have significant levels of uncontracted or discounted transportation and storage
capacity on its natural gas and natural gas liquids pipelines and in its storage assets.
ONEOK Partners’ natural gas and natural gas liquids pipelines and storage assets compete with other pipelines and storage facilities for
natural gas and NGL supplies delivered to the markets it serves. As a result of competition, ONEOK Partners may have significant levels of
uncontracted or discounted capacity on its pipelines and in its storage assets, which could have a material adverse impact on ONEOK
Partners’ results of operations.
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ONEOK Partners is exposed to the credit risk of its customers or counterparties, and its credit risk management may not be adequate to
protect against such risk.
ONEOK Partners is subject to the risk of loss resulting from nonpayment and/or nonperformance by ONEOK Partners’ customers or
counterparties. ONEOK Partners’ customers or counterparties may experience deterioration of their financial condition as a result of changing
market conditions or financial difficulties that could impact their creditworthiness or ability to pay ONEOK Partners for its services. ONEOK
Partners assesses the creditworthiness of its customers or counterparties and obtains security as it deems appropriate. If ONEOK Partners
fails to adequately assess the creditworthiness of existing or future customers or counterparties, unanticipated deterioration in their
creditworthiness and any resulting nonpayment and/or nonperformance could adversely impact ONEOK Partners’ results of operations. In
addition, if any of ONEOK Partners’ customers or counterparties files for bankruptcy protection, this could have a material negative impact on
ONEOK Partners’ results of operations.
Any reduction in ONEOK Partners’ credit ratings could materially and adversely affect its business, financial condition, liquidity and
results of operations.
ONEOK Partners’ senior unsecured long-term debt has been assigned an investment-grade rating by Moody’s of “Baa2” (Stable) and by S&P
of “BBB” (Stable). However, we cannot provide assurance that any of its current ratings will remain in effect for any given period of time or
that a rating will not be lowered or withdrawn entirely by a rating agency if, in its judgment, circumstances in the future so
warrant. Specifically, if Moody’s or S&P were to downgrade ONEOK Partners’ long-term debt rating, particularly below investment grade, its
borrowing costs would increase, which would adversely affect its financial results, and its potential pool of investors and funding sources
could decrease. Ratings from credit agencies are not recommendations to buy, sell or hold ONEOK Partners’ securities. Each rating should be
evaluated independently of any other rating.
A downgrade of ONEOK Partners’ credit rating may require ONEOK Partners to offer to repurchase certain of its senior notes or may
impair its ability to access capital.
ONEOK Partners could be required to offer to repurchase certain of its senior notes due 2010 and 2011 at par value, plus any accrued and
unpaid interest, if Moody’s or S&P rates those senior notes below investment grade (Baa3 for Moody’s and BBB- for S&P) and the
investment-grade rating is not reinstated within a period of 40 days. Further, the indenture governing ONEOK Partners’ senior notes due 2010
and 2011 include an event of default upon acceleration of other indebtedness of $25 million or more and the indentures governing ONEOK
Partners’ senior notes due 2012, 2016, 2036 and 2037 include an event of default upon the acceleration of other indebtedness of $100 million or
more that would be triggered by such an offer to repurchase. Such an event of default would entitle the trustee or the holders of 25 percent in
aggregate principal amount of the outstanding senior notes due 2010, 2011, 2012, 2016, 2036 and 2037 to declare those notes immediately due
and payable in full. ONEOK Partners may not have sufficient cash on hand to repurchase and repay any accelerated senior notes, which may
cause ONEOK Partners to borrow money under its credit facilities or seek alternative financing sources to finance the repurchases and
repayment. ONEOK Partners could also face difficulties accessing capital or its borrowing costs could increase, impacting its ability to obtain
financing for acquisitions or capital expenditures, to refinance indebtedness and to fulfill its debt obligations.
ONEOK Partners has adopted certain valuation methodologies that may result in a shift of income, gain, loss and deduction between the
general partner and the unitholders. The IRS may challenge this treatment, which could adversely affect the value of its limited partner
units.
When ONEOK Partners issues additional units or engages in certain other transactions, ONEOK Partners determines the fair market value of
its assets and allocates any unrealized gain or loss attributable to its assets to the capital accounts of its unitholders and its general
partner. ONEOK Partners’ methodology may be viewed as understating the value of its assets. In that case, there may be a shift of income,
gain, loss and deduction between certain unitholders and the general partner, which may be unfavorable to such unitholders. Moreover,
under ONEOK Partners’ current valuation methods, subsequent purchasers of common units may have a greater portion of their Internal
Revenue Code Section 743(b) adjustment allocated to ONEOK Partners’ tangible assets and a lesser portion allocated to ONEOK Partners’
intangible assets. The IRS may challenge ONEOK Partners’ valuation methods or ONEOK Partners’ allocation of the Section 743(b)
adjustment attributable to ONEOK Partners’ tangible and intangible assets, and allocations of income, gain, loss and deduction between the
general partner and certain of ONEOK Partners’ unitholders.
A successful IRS challenge to these methods or allocations could adversely affect the amount of taxable income or loss being allocated to
ONEOK Partners’ unitholders. It also could affect the amount of gain from ONEOK Partners unitholders’ sale
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of common units and could have a negative impact on the value of the common units or result in audit adjustments to ONEOK Partners
unitholders’ tax returns without the benefit of additional deductions.
ONEOK Partners’ treatment of a purchaser of common units as having the same tax benefits as the seller could be challenged, resulting in
a reduction in value of the common units.
Because ONEOK Partners cannot match transferors and transferees of common units, ONEOK Partners is required to maintain the uniformity
of the economic and tax characteristics of these units in the hands of the purchasers and sellers of these units. ONEOK Partners does so by
adopting certain depreciation conventions that do not conform to all aspects of the United States Treasury regulations. An IRS challenge to
these conventions could adversely affect the tax benefits to a unitholder of ownership of the common units and could have a negative impact
on their value or result in audit adjustments to ONEOK Partners unitholders’ tax returns.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 2. PROPERTIES
DESCRIPTION OF PROPERTIES
ONEOK Partners
Property - Our ONEOK Partners segment owns the following assets:

•approximately 10,100 miles and 4,500 miles of natural gas gathering pipelines in the Mid-Continent and Rocky Mountain regions,
respectively;
•nine active natural gas processing plants with approximately 645 MMcf/d of processing capacity in the Mid-Continent region and
four active natural gas processing plants with approximately 80 MMcf/d of processing capacity in the Rocky Mountain region;
•approximately 18 MBbl/d of natural gas liquids fractionation capacity at various natural gas processing plants in the Mid-Continent
and Rocky Mountain regions;
•approximately 1,320 miles of FERC-regulated interstate natural gas pipelines with approximately 2.5 Bcf/d of peak transportation
capacity;
•approximately 5,560 miles of intrastate natural gas gathering and state-regulated intrastate transmission pipelines with peak
transportation capacity of approximately 3.3 Bcf/d;
•approximately 51.6 Bcf of total active working natural gas storage capacity;
•approximately 2,011 miles of natural gas liquids gathering pipelines with peak capacity of approximately 247 MBbl/d;
•approximately 163 miles of natural gas liquids distribution pipelines with peak transportation capacity of approximately 66 MBbl/d;
•two natural gas liquids fractionators with operating capacity of approximately 260 MBbl/d;
•150 MBbl/d of fractionation capacity, including leased capacity;
•80 percent ownership interest in one natural gas liquids fractionator with operating capacity of approximately 160 MBbl/d;
•interest in one natural gas liquids fractionator with proportional operating capacity of approximately 11 MBbl/d;
•one 9 MBbl/d isomerization unit;
•six NGL storage facilities and four other leased facilities in Okalahoma, Kansas and Texas, with approximately 26.4 MMBbl of total
operating underground NGL storage capacity;
•approximately 1,480 miles of FERC-regulated natural gas liquids gathering pipelines with peak capacity of approximately 203 MBbl/d;
•approximately 3,480 miles of FERC-regulated natural gas liquids and refined petroleum products distribution pipelines with peak
transportation capacity of 691 MBbl/d;
•eight NGL product terminals in Missouri, Nebraska, Iowa and Illinois; and
•above- and below-ground storage facilities in Iowa, Illinois, Nebraska and Kansas with 978 MBbl operating capacity.
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ONEOK Partners’ natural gas pipelines business owns five underground natural gas storage facilities in Oklahoma, three underground natural
gas storage facilities in Kansas and three underground natural gas storage facilities in Texas. One of its natural gas storage facilities has been
idle since 2001 following natural gas explosions and eruptions of natural gas geysers in Hutchinson, Kansas. ONEOK Partners began
injecting brine into the idled facility in the first quarter of 2007 in order to ensure its long-term integrity. ONEOK Partners expects to complete
the injection process by the end of 2011. Monitoring of the facility and review of the data for the geoengineering study are ongoing, in
compliance with a KDHE order while ONEOK Partners evaluates the alternatives for the facility. Following the testing of the gathered data,
ONEOK Partners expects to return the facility to storage service, although most likely for a product other than natural gas. The return to
service will require KDHE approval. It is possible, however, that testing could reveal that it is not safe to return the facility to service or that
the KDHE will not grant the required permits to resume service.
Utilization - The utilization rates for ONEOK Partners’ various businesses for 2008 were as follows:
•natural gas processing plants were approximately 71 percent;
•natural gas pipelines were approximately 86 percent subscribed, and storage facilities were fully subscribed;
•natural gas liquids gathering pipelines were approximately 73 percent;
•ONEOK Partners’ average contracted storage volume were approximately 74 percent of storage capacity;
•natural gas liquids fractionators were approximately 87 percent;
•FERC-regulated natural gas liquids gathering pipelines were approximately 55 percent; and
•natural gas liquids distribution pipelines were approximately 49 percent.
ONEOK Partners calculated utilization on its assets using a weighted-average approach, adjusting for the in-service dates of assets placed in
service during 2008. The utilization rate of ONEOK Partners’ fractionation facilities reflects approximate proportional capacity associated with
ownership interests noted above and partial service for the Bushton facilities, which were placed in service during the second half of 2008.
On January 1, 2007, the Bushton Plant was temporarily idled as a result of a decline in natural gas volumes available for natural gas processing
at this straddle plant. Volumes declined due to natural field declines and as a result of contract terminations, as advances in technology made
it more cost efficient to process natural gas at other facilities. ONEOK Partners has contracted for all of the capacity of the plant from ONEOK.
During 2007 and 2008, ONEOK Partners added new natural gas liquids fractionation facilities at the Bushton location, in conjunction with other
changes that were made to the NGL fractionation capabilities of the existing plant. Although the Bushton Plant remains idled, ONEOK
Partners currently has 150 MBbl/d of active NGL fractionation capacity as a result of combining the previously existing fractionation
equipment with the new fractionation facilities. ONEOK Partners resumed fractionating NGLs at the facilities in the second half of 2008.
Distribution
Property - We own approximately 18,100 miles of pipeline and other distribution facilities in Oklahoma, approximately 12,800 miles of pipeline
and other distribution facilities in Kansas, and approximately 9,600 miles of pipeline and other distribution facilities in Texas.
Energy Services
Property - Our total natural gas storage capacity under lease is 91 Bcf, with maximum withdrawal capability of 2.3 Bcf/d and maximum injection
capability of 1.5 Bcf/d. Our current natural gas transportation capacity is 1.8 Bcf/d. Our contracted storage and transportation capacity
connects major supply and demand centers throughout the United States and into Canada. Our storage leases are spread across 25 different
contracts and two facilities in Canada.
Other
Property - We own the 17-story ONEOK Plaza office building, with approximately 517,000 square feet of net rentable space, and the associated
parking garage. In March 2008, ONEOK Leasing Company purchased ONEOK Plaza for the total purchase price of approximately $48 million,
which included $17.1 million for the present value of the remaining lease payments and $30.9 million for the base purchase price.
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ITEM 3. LEGAL PROCEEDINGS
Will Price, et al. v. Gas Pipelines, et al. (f/k/a Quinque Operating Company, et al. v. Gas Pipelines, et al.), 26th Judicial District, District
Court of Stevens County, Kansas, Civil Department, Case No. 99C30 (“Price I”). Plaintiffs brought suit on May 28, 1999, against us, five of
our subsidiaries and one of our divisions, as well as approximately 225 other defendants. Additionally, in connection with the completion of
our acquisition of the natural gas liquids businesses owned by several Koch companies, on July 1, 2005, we acquired Koch Hydrocarbon, LP
(renamed ONEOK Hydrocarbon, L.P.), which is also one of the defendants in this case. Plaintiffs sought class certification for its claims for
monetary damages that the defendants had underpaid gas producers and royalty owners throughout the United States by intentionally
understating both the volume and the heating content of purchased gas. After extensive briefing and a hearing, the Court refused to certify
the class sought by plaintiffs. Plaintiffs then filed an amended petition limiting the purported class to gas producers and royalty owners in
Kansas, Colorado and Wyoming and limiting the claim to undermeasurement of volumes. Oral argument on the plaintiffs’ motion to certify this
suit as a class action was conducted on April 1, 2005. The Court has not yet ruled on the class certification issue.
Will Price and Stixon Petroleum, et al. v. Gas Pipelines, et al., 26th Judicial District, District Court of Stevens County, Kansas, Civil
Department, Case No. 03C232 (“Price II”). This action was filed by the plaintiffs on May 12, 2003, after the Court had denied class status in
Price I. Plaintiffs are seeking monetary damages based upon a claim that 21 groups of defendants, including us and four of our subsidiaries,
intentionally underpaid gas producers and royalty owners by understating the heating content of purchased gas in Kansas, Colorado and
Wyoming. Additionally, in connection with the completion of our acquisition of the natural gas liquids businesses owned by several Koch
companies, on July 1, 2005, we acquired Koch Hydrocarbon, LP (renamed ONEOK Hydrocarbon, L.P.), which is also one of the defendants in
this case. Price II has been consolidated with Price I for the determination of whether either or both cases may properly be certified as class
actions. Oral argument on the plaintiffs’ motion to certify this suit as a class action was conducted on April 1, 2005. The Court has not yet
ruled on the class certification issue.
Mont Belvieu Emissions, Texas Commission on Environmental Quality - Personnel of ONEOK Hydrocarbon Southwest, L.L.C. (OHSL), a
subsidiary of ONEOK Partners, are in discussions with the Texas Commission on Environmental Quality (TCEQ) staff regarding air emissions
from a heat exchanger at ONEOK Partners’ Mont Belvieu fractionator, which may have exceeded the emissions allowed under its air
permit. OHSL discovered the possibility of excessive air emissions in May 2008. The TCEQ has not issued a notice of enforcement relating to
the emissions under this permit. Although no assurances can be given, ONEOK Partners does not believe that any penalties associated with
any alleged violations will have a material adverse effect on its financial position, results of operations, or net cash flows.
Gas Index Pricing Litigation: We, ONEOK Energy Services Company, L.P. (“OESC”) and one other affiliate are defending, either individually
or together, against the following lawsuits that claim damages resulting from the alleged market manipulation or false reporting of prices to gas
index publications by us and others: Samuel P. Leggett, et al. v. Duke Energy Corporation, et al. (filed in the Chancery Court for the Twenty-
Fifth Judicial District at Somerville, Tennessee, in January 2005); Sinclair Oil Corporation v. ONEOK Energy Services Corporation, L.P., et
al. (filed in the United States District Court for the District of Wyoming in September 2005, transferred to MDL-1566 in the United States
District Court for the District of Nevada); J.P. Morgan Trust Company v. ONEOK, Inc., et al. (filed in the District Court of Wyandotte County,
Kansas, in October 2005, transferred to MDL-1566 in the United States District Court for the District of Nevada); Learjet, Inc., et al. v. ONEOK,
Inc., et al. (filed in the District Court of Wyandotte, Kansas, in November 2005, transferred to MDL-1566 in the United States District Court for
the District of Nevada); Breckenridge Brewery of Colorado, LLC, et al. v. ONEOK, Inc., et al. (filed in the District Court of Denver County,
Colorado, in May 2006, transferred to MDL-1566 in the United States District Court for the District of Nevada); Missouri Public Service
Commission v. ONEOK, Inc., et al. (filed in the Sixth Judicial Circuit Court of Jackson County, Missouri, in October 2006); Arandell
Corporation, et al. v. Xcel Energy, Inc., et al. (filed in the Circuit Court for Dane County, Wisconsin, in December 2006, transferred to MDL-
1566 in the United States District Court for the District of Nevada); Heartland Regional Medical Center, et al. v. ONEOK, Inc., et al. (filed in
the Circuit Court of Buchanan County, Missouri, transferred to MDL-1566 in the United States District Court for the District of Nevada). In
each of these lawsuits, the plaintiffs allege that we, OESC and one other affiliate and approximately ten other energy companies and their
affiliates engaged in an illegal scheme to inflate natural gas prices by providing false information to gas price index publications during the
years from 2000 to 2002. All of the complaints arise out of the U.S. Commodity Futures Trading Commission investigation into and reports
concerning false gas price index-reporting or manipulation in the energy marketing industry. Other than as noted below, each of the cases are
in pretrial discovery.
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Motions to dismiss were granted in the Leggett, Sinclair, and Missouri Public Service Commission cases. The dismissal of the Sinclair case
was appealed to the United States Court of Appeals for the Ninth Circuit, but is in the process of being remanded back to the multi-district
litigation matter MDL-1566 in the United States District Court for the District of Nevada for further proceedings. The dismissal of the Leggett
case was reversed by the Tennessee Court of Appeals on October 29, 2008, but the defendants, including us and OESC, have filed an
application with the Tennessee Supreme Court to appeal the decision. On January 8, 2009, summary judgment was granted in favor of all of
the defendants except one in the Breckenridge case and judgment was entered against the plaintiffs in favor of those defendants, including
us, OESC and our other affiliate. We continue to analyze all of these claims and are vigorously defending against them.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of our security holders, through the solicitation of proxies or otherwise, during the fourth quarter 2008.
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
MARKET INFORMATION AND HOLDERS
Our common stock is listed on the NYSE under the trading symbol “OKE.” The corporate name ONEOK is used in newspaper stock
listings. The following table sets forth the high and low closing prices of our common stock for the periods indicated.
Year Ended Year Ended

December 31, 2008 December 31, 2007
High Low High Low
First Quarter $ 49.21 $ 43.93 $ 46.13 $ 40.12
Second Quarter $ 50.63 $ 45.62 $ 54.58 $ 44.57
Third Quarter $ 49.59 $ 33.41 $ 54.86 $ 43.65
Fourth Quarter $ 34.35 $ 23.17 $ 52.05 $ 44.29
At February 18, 2009, there were 13,804 holders of record of our 105,239,496 outstanding shares of common stock.
DIVIDENDS
The following table sets forth the quarterly dividends declared and paid per share of our common stock during the periods indicated.

2008 2007
First Quarter $ 0.38 $ 0.34
Second Quarter $ 0.38 $ 0.34
Third Quarter $ 0.40 $ 0.36
Fourth Quarter $ 0.40 $ 0.36 (a)
(a) - Declared in the previous quarter.
In January 2009, we declared a dividend of $0.40 per share ($1.60 per share on an annualized basis) for the fourth quarter of 2008, which was
paid on February 13, 2009, to shareholders of record as of January 30, 2009.
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ISSUER PURCHASES OF EQUITY SECURITIES
The following table sets forth information relating to our purchases of our common stock for the periods shown.
Total Number of Maximum Number (or

Shares Purchased as Approximate Dollar Value) of
Part of Publicly Shares (or Units) that May Be
Total Number of Shares Average Price Announced Plans or Purchased Under the Plans or
Period Purchased Paid per Share Programs Programs
October 1-31, 2008 - - - -

November 1-30, 2008 - - - -
December 1-31, 2008 10 (1) $27.38 - -
Total 10 $27.38 - -
(1) - Represents shares repurchased directly from employees, pursuant to our Employee Stock Award Program.
EMPLOYEE STOCK AWARD PROGRAM
Under our Employee Stock Award Program, we issued, for no consideration, to all eligible employees (all full-time employees and employees
on short-term disability) one share of our common stock when the per-share closing price of our common stock on the NYSE was for the first
time at or above $26 per share, and we have issued and will continue to issue, for no consideration, one additional share of our common stock
to all eligible employees when the closing price on the NYSE is for the first time at or above each one dollar increment above $26 per
share. The total number of shares of our common stock available for issuance under this program is 300,000.
Through December 31, 2008, a total of 144,352 shares have been issued to employees under this program. The shares issued under this
program have not been registered under the Securities Act of 1933, as amended (1933 Act), in reliance upon the position taken by the SEC (see
Release No. 6188, dated February 1, 1980) that the issuance of shares to employees pursuant to a program of this kind does not require
registration under the 1933 Act. See Note N of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for
additional information.
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PERFORMANCE GRAPH
The following performance graph compares the performance of our common stock with the S&P 500 Index and the S&P Utilities Index during
the period beginning on December 31, 2003, and ending on December 31, 2008. The graph assumes a $100 investment in our common stock
and in each of the indices at the beginning of the period and a reinvestment of dividends paid on such investments throughout the period.
Value of $100 Investment Assuming Reinvestment of Dividends

At December 31, 2003, and at the End of Every Year Through December 31, 2008
Among ONEOK, Inc., The S&P 500 Index and The S&P Utilities Index
Cumulative Total Return

Years Ending December 31,
2003 2004 2005 2006 2007 2008
ONEOK, Inc. $ 100.00 $ 133.74 $ 130.01 $ 218.10 $ 233.19 $ 157.65

S&P 500 Index $ 100.00 $ 110.88 $ 116.32 $ 134.69 $ 142.09 $ 89.52
S&P Utilities Index (a) $ 100.00 $ 124.28 $ 145.21 $ 175.69 $ 209.73 $ 148.95
(a) - The Standard & Poors Utilities Index is comprised of the following companies: AES Corp.; Allegheny Energy, Inc.;
Ameren Corp.; American Electric Power Co., Inc.; Centerpoint Energy, Inc.; CMS Energy Corp.; Consolidated Edison, Inc.;
Constellation Energy Group, Inc.; Dominion Resources, Inc.; DTE Energy Co.; Duke Energy Corp.; Dynegy, Inc.; Edison
International; Entergy Corp.; Equitable Resources, Inc.; Exelon Corp.; FirstEnergy Corp.; FPL Group, Inc.; Integrys Energy
Group, Inc.; Nicor, Inc.; NiSource, Inc.; Pepco Holdings, Inc.; PG&E Corp.; Pinnacle West Capital Corp.; PPL Corp.; Progress
Energy, Inc.; Public Service Enterprise Group, Inc.; Questar Corp.; SCANA Corp.; Sempra Energy; Southern Co.; TECO
Energy, Inc.; Wisconsin Energy Corp.; and Xcel Energy, Inc.
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ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth our selected financial data for each of the periods indicated.

2008 2007 2006 2005 2004
(Millions of dollars, except per share amounts)
Revenues $ 16,157.4 $ 13,477.4 $ 11,920.3 $ 12,676.2 $ 5,785.5
Income from continuing operations $ 311.9 $ 304.9 $ 306.7 $ 403.1 $ 224.7
Net income $ 311.9 $ 304.9 $ 306.3 $ 546.5 $ 242.2
Total assets $ 13,126.1 $ 11,062.0 $ 10,391.1 $ 9,284.2 $ 7,199.2
Long-term debt, including current maturities $ 4,230.8 $ 4,635.5 $ 4,049.0 $ 2,030.6 $ 1,884.7
Basic earnings per share - continuing operations $ 2.99 $ 2.84 $ 2.74 $ 4.01 $ 2.21
Basic earnings per share - total $ 2.99 $ 2.84 $ 2.74 $ 5.44 $ 2.38
Diluted earnings per share - continuing operations $ 2.95 $ 2.79 $ 2.68 $ 3.73 $ 2.13
Diluted earnings per share - total $ 2.95 $ 2.79 $ 2.68 $ 5.06 $ 2.30
Dividends declared per common share $ 1.56 $ 1.40 $ 1.22 $ 1.09 $ 0.88
Financial data for 2008, 2007 and 2006 is not directly comparable with 2005 and 2004 due to the significance of the sale of certain assets to
ONEOK Partners in April 2006. See discussion of acquisitions and dispositions beginning on page 36 under “Significant Acquisitions and
Divestitures” in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operation.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATION
The following discussion and analysis should be read in conjunction with our audited consolidated financial statements and the Notes to
Consolidated Financial Statements in this Annual Report on Form 10-K.
EXECUTIVE SUMMARY
The following discussion highlights some of our achievements this past year. Please refer to the “Financial Results and Operating
Information,” “Liquidity and Capital Resources,” and “Capital Projects” sections of Management’s Discussion and Analysis of Financial
Condition and Results of Operation and our consolidated financial statements for additional information.
Operating Results - Diluted earnings per share of common stock from continuing operations (EPS) increased to $2.95 in 2008, compared with
$2.79 in 2007. Operating income for 2008 increased to $917.0 million from $822.5 million for 2007. This increase is primarily due to wider NGL
product price differentials, higher realized commodity prices, increased NGL gathering and fractionation volumes, and incremental operating
income associated with the assets acquired from Kinder Morgan Energy Partners, L.P. (Kinder Morgan), all in our ONEOK Partners
segment. This increase in operating income was partially offset by decreases in storage and marketing margins and transportation margins,
net of hedging activities, in our Energy Services segment.
ONEOK Partners’ Equity Issuance - In March 2008, we purchased from ONEOK Partners, in a private placement, an additional 5.4 million of
ONEOK Partners’ common units for a total purchase price of approximately $303.2 million. In addition, ONEOK Partners completed a public
offering of 2.5 million common units at $58.10 per common unit and received net proceeds of $140.4 million after deducting underwriting
discounts but before offering expenses. In conjunction with ONEOK Partners’ private placement and public offering of common units,
ONEOK Partners GP contributed $9.4 million to ONEOK Partners in order to maintain its 2 percent general partner interest.
order to maintain its 2 percent general partner interest. Following these transactions, our interest in ONEOK Partners is 47.7 percent.
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ONEOK Partners used a portion of the proceeds from the sale of common units and the general partner contributions to repay borrowings
under its $1.0 billion revolving credit agreement dated March 30, 2007, as amended July 31, 2007 (the ONEOK Partners Credit Agreement).
Dividends/Distributions - During 2008, we paid dividends totaling $1.56 per share, an increase of approximately 11 percent over the $1.40 per
share paid during 2007. We declared a quarterly dividend of $0.40 per share ($1.60 per share on an annualized basis) in January 2009, an
increase of approximately 5 percent over the $0.38 declared in January 2008. During 2008, ONEOK Partners paid cash distributions totaling
$4.205 per unit, an increase of approximately 6 percent over the $3.98 per unit paid during 2007. ONEOK Partners declared a cash distribution
of $1.08 per unit ($4.32 per unit on an annualized basis) in January 2009, an increase of approximately 5 percent over the $1.025 declared in
January 2008.
Capital Projects - ONEOK Partners placed the following projects in-service during 2008:
•January - Midwestern Gas Transmission’s eastern extension pipeline;
•July - final phase of Fort Union Gas Gathering expansion project;
•September - Woodford Shale natural gas liquids pipeline extension;
•October - Bushton Fractionation expansion;
•November - Overland Pass Pipeline from Opal, Wyoming to Conway, Kansas; and
•December - partial operations of the Guardian pipeline extension with interruptible service from Ixonia, Wisconsin, to Green Bay,
Wisconsin.
Key Performance Indicators - Key performance indicators reviewed by management include:

•earnings per share;
•return on invested capital; and
•shareholder appreciation.
For 2008, our basic and diluted earnings per share from continuing operations were $2.99 and $2.95, respectively, representing a 5 percent
increase in basic earnings per share and a 6 percent increase in diluted earnings per share from continuing operations compared with 2007. For
2007, our basic and diluted earnings per share from continuing operations were $2.84 and $2.79, respectively, representing a 4 percent increase
in basic earnings per share and a 4 percent increase in diluted earnings per share from continuing operations compared with 2006. Return on
invested capital was 13 percent in 2008 and 14 percent in 2007 and 2006, respectively.
To evaluate shareholder appreciation, we compare the total return over a three-year period of an investment in our stock with the total return
of an investment in the stock of a group of peer companies. For the three-year period ended December 31, 2008, we ranked fifth in this
shareholder appreciation calculation when compared with 18 of our peers.
Outlook for 2009 - We expect continued deteriorating economic conditions in 2009, with significant downward pressures, relative to 2008, on
commodity prices for natural gas, NGLs and crude oil. We anticipate that lower commodity prices will result in reduced drilling activity, and
economic conditions will reduce petrochemical demand. We also expect continued volatility and disruption in the financial markets which
could result in an increased cost of capital. We expect depressed commodity prices and tighter capital markets to also result in the sale or
consolidation of underperforming assets in the industry, which may present opportunities for us.
SIGNIFICANT ACQUISITIONS AND DIVESTITURES
Acquisition of NGL Pipeline - In October 2007, ONEOK Partners completed the acquisition of an interstate natural gas liquids and refined
petroleum products pipeline system and related assets from a subsidiary of Kinder Morgan for approximately $300 million, before working
capital adjustments. The system extends from Bushton and Conway, Kansas, to Chicago, Illinois, and transports, stores and delivers a full
range of NGL products and refined petroleum products. The FERC-regulated system spans 1,624 miles and has a capacity to transport up to
134 MBbl/d. The transaction also included approximately 978 MBbl of owned storage capacity, eight NGL terminals and a 50 percent
ownership of Heartland. ConocoPhillips owns the other 50 percent of Heartland and is the managing partner of the Heartland joint venture,
which consists primarily of a refined petroleum products terminal and pipelines with access to two other refined petroleum products
terminals. ONEOK Partners’ investment in Heartland is accounted for under the equity method of accounting. Financing for this transaction
came from a portion of the proceeds of ONEOK Partners’ September 2007 issuance of $600 million 6.85 percent Senior Notes due 2037 (the 2037
Notes). See Note I of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for a discussion of the 2037
Notes. The working capital settlement was finalized in April 2008, with no material adjustments.
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Overland Pass Pipeline Company - - See “Capital Projects” for discussion of Overland Pass Pipeline Company.
ONEOK Partners - In April 2006, we sold certain assets comprising our former gathering and processing, natural gas liquids, and pipelines
and storage segments to ONEOK Partners for approximately $3 billion, including $1.35 billion in cash, before adjustments, and approximately
36.5 million Class B limited partner units in ONEOK Partners. The Class B limited partner units and the related general partner interest
contribution were valued at approximately $1.65 billion. We also purchased, through ONEOK Partners GP, from an affiliate of TransCanada,
17.5 percent of the general partner interest in ONEOK Partners for $40 million. This purchase resulted in our ownership of the entire 2 percent
general partner interest in ONEOK Partners. Following the completion of the transactions, we owned a total of approximately 37.0 million
common and Class B limited partner units and the entire 2 percent general partner interest and control of the partnership. Our overall interest
in ONEOK Partners, including the 2 percent general partner interest, was 45.7 percent at the date of acquisition.
The sale of certain assets comprising our former gathering and processing, pipelines and storage, and natural gas liquids segments did not
affect our consolidated operating income on our Consolidated Statements of Income or total assets on our Consolidated Balance Sheets, as we
were already required under EITF 04-5 to consolidate our investment in ONEOK Partners effective January 1, 2006. However, minority interest
expense and net income were affected. See Note A of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K
beginning on page 76 for additional discussion of our consolidation of ONEOK Partners.
Disposition of 20 percent interest in Northern Border Pipeline - In April 2006, in connection with the transactions described immediately
above, our ONEOK Partners segment completed the sale of a 20 percent partnership interest in Northern Border Pipeline to TC PipeLines for
approximately $297 million. Our ONEOK Partners segment recorded a gain on sale of approximately $113.9 million in the second quarter of
2006. ONEOK Partners and TC PipeLines each now own a 50 percent interest in Northern Border Pipeline, and an affiliate of TransCanada
became operator of the pipeline in April 2007. As a result of this transaction, ONEOK Partners’ interest in Northern Border Pipeline is
accounted for as an investment under the equity method applied on a retroactive basis to January 1, 2006.
Acquisition of Guardian Pipeline Interests - In April 2006, our ONEOK Partners segment acquired the 66-2/3 percent interest in Guardian
Pipeline not previously owned by ONEOK Partners for approximately $77 million, increasing its ownership interest to 100 percent. ONEOK
Partners used borrowings from its credit facility to fund the acquisition of the additional interest in Guardian Pipeline. Following the
completion of the transaction, we consolidated Guardian Pipeline in our consolidated financial statements. This change was accounted for on
a retroactive basis to January 1, 2006.
CAPITAL PROJECTS
All of the capital projects discussed below are in our ONEOK Partners segment.
Woodford Shale Natural Gas Liquids Pipeline Extension - The 78-mile natural gas liquids gathering pipeline connecting two natural gas
processing plants, operated by Devon Energy Corporation and Antero Resources Corporation, was placed into service in September
2008. The cost of the project was approximately $36 million, excluding AFUDC. These two plants have the capacity to produce approximately
25 MBbl/d of unfractionated NGLs. The natural gas liquids production is gathered by ONEOK Partners’ existing Mid-Continent natural gas
liquids gathering pipelines. Upon completion of the Arbuckle Pipeline project, the Woodford Shale natural gas liquids production is expected
to be transported through the Arbuckle Pipeline to ONEOK Partners’ Mont Belvieu, Texas, fractionation facility.
Overland Pass Pipeline Company - - In May 2006, a subsidiary of ONEOK Partners entered into an agreement with a subsidiary of The
Williams Companies, Inc. (Williams) to form a joint venture called Overland Pass Pipeline Company. In November 2008, Overland Pass Pipeline
Company completed construction of a 760-mile natural gas liquids pipeline from Opal, Wyoming, to the Mid-Continent natural gas liquids
market center in Conway, Kansas. The Overland Pass Pipeline is designed to transport approximately 110 MBbl/d of unfractionated NGLs and
can be increased to approximately 255 MBbl/d with additional pump facilities. During 2006, ONEOK Partners paid $11.6 million to Williams for
the acquisition of its interest in the joint venture and for reimbursement of initial capital expenditures. A subsidiary of ONEOK Partners owns
99 percent of the joint venture, managed the construction project, advanced all costs associated with construction and is currently operating
the pipeline. On or before November 17, 2010, Williams will have the option to increase its ownership up to 50 percent, with the purchase price
determined in accordance with the joint venture’s operating agreement. If Williams exercises its option to increase its ownership to the full 50
percent, Williams would have the option to become operator. The pipeline project cost was approximately $575 million, excluding AFUDC.
As part of a long-term agreement, Williams dedicated its NGL production from two of its natural gas processing plants in Wyoming, estimated
to be approximately 60 MBbl/d, to the Overland Pass Pipeline. Subsidiaries of ONEOK Partners will
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provide downstream fractionation, storage and transportation services to Williams. ONEOK Partners has also reached agreements with certain
producers for supply commitments of up to an additional 80 MBbl/d and is negotiating agreements with other producers for supply
commitments that could add an additional 60 MBbl/d of supply to this pipeline within the next three to five years.
ONEOK Partners also invested approximately $239 million, excluding AFUDC, to expand its existing fractionation and storage capabilities and
to increase the capacity of its natural gas liquids distribution pipelines. Part of this expansion included adding new fractionation facilities at
ONEOK Partners’ Bushton location, increasing total fractionation capacity at Bushton to 150 MBbl/d. The addition of the new facilities and
the upgrade to the existing fractionator was completed in October 2008. Additionally, portions of the natural gas liquids distribution pipeline
upgrades were completed in the second and third quarters of 2008.
Piceance Lateral Pipeline - In March 2007, ONEOK Partners announced that Overland Pass Pipeline Company also plans to construct a 150-
mile lateral pipeline with capacity to transport as much as 100 MBbl/d of unfractionated NGLs from the Piceance Basin in Colorado to the
Overland Pass Pipeline. Williams announced that it intends to construct a new natural gas processing plant in the Piceance Basin and will
dedicate its NGL production from that plant and an existing plant, with estimated volumes totaling approximately 30 MBbl/d, to be transported
by the lateral pipeline. ONEOK Partners continues to negotiate with other producers for supply commitments. In October 2008, this project
received approval of various state and federal regulatory authorities allowing construction to commence. Construction began during the
fourth quarter of 2008 and is expected be completed during the third quarter of 2009. The project is currently estimated to cost in the range of
$110 million to $140 million, excluding AFUDC.
D-J Basin Lateral Pipeline - In September 2008, ONEOK Partners announced plans to construct a 125-mile natural gas liquids lateral pipeline
from the Denver-Julesburg Basin in northeastern Colorado to the Overland Pass Pipeline, with capacity to transport as much as 55 MBbl/d of
unfractionated NGLs. The project is currently estimated to cost in the range of $70 million to $80 million, excluding AFUDC. ONEOK Partners
has supply commitments for up to 33 MBbl/d of unfractionated NGLs with potential for an additional 10 MBbl/d of supply from new drilling
and plant upgrades in the next two years. The pipeline is currently under construction and is expected to be fully completed during the first
quarter of 2009.
Arbuckle Pipeline Natural Gas Liquids Pipeline - In March 2007, ONEOK Partners announced plans to build the 440-mile Arbuckle Pipeline, a
natural gas liquids pipeline from southern Oklahoma through northern Texas and continuing on to the Texas Gulf Coast. The Arbuckle
Pipeline will have the capacity to transport 160 MBbl/d of unfractionated NGLs, expandable to 210 MBbl/d with additional pump facilities, and
will connect with ONEOK Partners’ existing Mid-Continent infrastructure with its fractionation facility in Mont Belvieu, Texas, and other Gulf
Coast region fractionators. ONEOK Partners has supply commitments from producers that it expects will be sufficient to fill the 210 MBbl/d
capacity level over the next three to five years. Construction on the pipeline has been underway since the third quarter of 2008. Much of the
Oklahoma and north Texas portions are either complete or nearing completion. However, right-of-way acquisition has been challenging, time
consuming and expensive, which could affect the completion schedule and final cost of the project. Many of Arbuckle Pipeline’s remaining
right-of-way tracts are being acquired through a condemnation process, which adds to the cost and time to construct the pipeline. The
demand for surface easements has increased dramatically in Texas and Oklahoma in the last 12 to 18 months because of increased oil and
natural gas exploration and production activities, as well as pipeline construction. Because of the delays associated with right-of-way
acquisition, we anticipate construction on the south end of the project will be more difficult and expensive due to wet low-lying areas and
potential for spring rains. Accordingly, we expect the project to be operational in the second quarter of 2009. Based on the increased costs
and delays associated with right-of-way acquisition and potential weather impacts, our project costs could increase 10 percent to 15 percent
above the range of $340 million to $360 million, excluding AFUDC, as previously reported.
Williston Basin Gas Processing Plant Expansion - In March 2007, ONEOK Partners announced the expansion of its Grasslands natural gas
processing facility in North Dakota, currently estimated to cost in the range of $40 million to $45 million, excluding AFUDC. ONEOK Partners’
estimated project costs increased from $30 million primarily as a result of higher contract labor and equipment costs. The Grasslands facility is
ONEOK Partners’ largest natural gas processing plant in the Williston Basin. The expansion increases processing capacity to approximately
100 MMcf/d from its current capacity of 63 MMcf/d and increases fractionation capacity to approximately 12 MBbl/d from 8 MBbl/d. The
construction of the expansion project is expected to be complete in the first quarter of 2009.
Fort Union Gas Gathering Expansion - In January 2007, Fort Union Gas Gathering announced plans to double its existing gathering pipeline
capacity by adding 148 miles of new gathering lines, resulting in approximately 649 MMcf/d of additional capacity in the Powder River basin of
Wyoming. The expansion occurred in two phases and cost approximately $121 million, excluding AFUDC, which was financed within the Fort
Union Gas Gathering partnership. Any cost overruns are covered through escalation clauses to preserve the original economics of the
project. Phase I, with more than 200 MMcf/d
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capacity, was placed in service during the fourth quarter of 2007. Phase II, with approximately 450 MMcf/d capacity, was completed in July
2008. The additional capacity has been fully subscribed for 10 years. ONEOK Partners owns approximately 37 percent of Fort Union Gas
Gathering, and accounts for its ownership under the equity method of accounting.
Guardian Pipeline Expansion and Extension - In December 2007, Guardian Pipeline received and accepted the certificate of public convenience
and necessity issued by the FERC for its expansion and extension project. The certificate authorizes ONEOK Partners to construct, install and
operate approximately 119 miles of a 20-inch and 30-inch natural gas transportation pipeline with a capacity to transport 537 MMcf/d of natural
gas north from Ixonia, Wisconsin to the Green Bay, Wisconsin, area. The project is supported by 15-year shipper commitments with We
Energies and Wisconsin Public Service Corporation and the capacity has been fully subscribed. The project is currently estimated to cost in
the range of $277 million and $305 million, excluding AFUDC. ONEOK Partners’ estimated project costs increased from the initial estimate of
$241 million in 2006, which excluded AFUDC, primarily due to weather delays, equipment delivery delays, construction in environmentally
sensitive areas, rocky terrain, and escalating costs associated with crop damage and condemnation costs. ONEOK Partners received the
notice to proceed from the FERC in May 2008. On December 22, 2008, the FERC issued a letter order granting Guardian Pipeline’s request for
an extension of time for a phased in-service. On December 29, 2008, the FERC issued a letter order granting Guardian Pipeline’s request to
commence service. On December 31, 2008, the pipeline and seven meter stations were placed into service with the ability to transport natural
gas on a limited basis. Construction on one compressor station is complete, and construction on a second compressor station is near
completion. The project is expected to be fully in service in the first quarter of 2009.
REGULATORY
Several regulatory initiatives positively impacted the earnings and future earnings potential for our Distribution segment. See discussion of
our Distribution segment’s regulatory initiative beginning on page 49.
IMPACT OF NEW ACCOUNTING STANDARDS
Information about the impact of the following new accounting standards is included in Note A of the Notes to Consolidated Financial
Statements in this Annual Report on Form 10-K:
•Statement 123R, “Share-Based Payment;”
•Statement 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans;”
•FIN 48, “Accounting for Uncertainty in Income Taxes - An Interpretation of FASB Statement No. 109;”
•Statement 157, “Fair Value Measurements,” and related FASB Staff Position (FSP) 157-2, “Effective Date of FASB Statement no. 157,”
and FSP 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active;”
•Statement 159, “The Fair Value Option for Financial Assets and Financial Liabilities;”
•FSP FIN 39-1, “Amendment of FASB Interpretation No. 39;”
•Statement 141R, “Business Combinations;”
•Statement 160, “Noncontrolling Interest in Consolidated Financial Statements - an amendment to ARB No. 51;”
•Statement 161, “Disclosures about Derivative Instruments and Hedging Activities - an amendment to FASB Statement No. 133;”
•EITF 08-6, “Equity Method Investment Accounting Considerations;” and
•Statement 132R-1, “Employers’ Disclosures about Postretirement Benefit Plan Assets.”
CRITICAL ACCOUNTING ESTIMATES
The preparation of our consolidated 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 consolidated 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 is a summary of our most critical accounting estimates, which are defined as those estimates 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. We have discussed the development and
selection of our critical accounting policies and estimates with the Audit Committee of our Board of Directors.
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Fair Value Measurements - General - In September 2006, the FASB issued Statement 157 that establishes a framework for measuring fair value
and requires additional disclosures about fair value measurements. Beginning January 1, 2008, we partially applied Statement 157 as allowed
by FSP 157-2 that delayed the effective date of Statement 157 for nonrecurring fair value measurements associated with our nonfinancial assets
and liabilities. As of January 1, 2008, we applied the provisions of Statement 157 to our recurring fair value measurements, and the impact was
not material upon adoption. As of January 1, 2009, we have applied the provisions of Statement 157 to our nonrecurring fair value
measurements associated with our nonfinancial assets and liabilities, and the impact was not material. FSP 157-3, which clarified the
application of Statement 157 in inactive markets, was issued in October 2008 and was effective for our September 30, 2008, consolidated
financial statements. FSP 157-3 did not have a material impact on our consolidated financial statements.
In February 2007, the FASB issued Statement 159 that allows companies to elect to measure specified financial assets and liabilities, firm
commitments, and nonfinancial warranty and insurance contracts at fair value on a contract-by-contract basis, with changes in fair value
recognized in earnings each reporting period. At January 1, 2008, we did not elect the fair value option under Statement 159, and therefore
there was no impact on our consolidated financial statements.
Determining Fair Value - Statement 157 defines fair value as the price that would be received to sell an asset or transfer 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. While many of the contracts in our portfolio are
executed in liquid markets where price transparency exists, some contracts are executed in markets for which market prices may exist but the
market may be relatively inactive. This results in limited price transparency that requires management’s judgment and assumptions to estimate
fair values. Inputs into our fair value estimates include commodity exchange prices, over-the-counter quotes, volatility, historical correlations
of pricing data and LIBOR and other liquid money market instrument rates. We also utilize internally developed basis curves that incorporate
observable and unobservable market data. We validate our valuation inputs with third-party information and settlement prices from other
sources, where available. In addition, as prescribed by the income approach, we compute the fair value of our derivative portfolio by
discounting the projected future cash flows from our derivative assets and liabilities to present value. The interest rate yields used to
calculate the present value discount factors are derived from LIBOR, Eurodollar futures and Treasury swaps. The projected cash flows are
then multiplied by the appropriate discount factors to determine the present value or fair value of our derivative instruments. We also take
into consideration the potential impact on market prices of liquidating positions in an orderly manner over a reasonable period of time under
current market conditions. Finally, we consider credit risk of our counterparties on the fair value of our derivative assets, as well as our own
credit risk for derivative liabilities, using default probabilities and recovery rates, net of collateral. We also take into consideration current
market data in our evaluation when available, such as bond prices and yields and credit default swaps. Although we use our best estimates to
determine the fair value of the derivative contracts we have executed, the ultimate market prices realized could differ from our estimates, and
the differences could be material.
Fair Value Hierarchy - - Statement 157 establishes the fair value hierarchy that prioritizes inputs to valuation techniques based on observable
and unobservable data and categorizes the inputs into three levels, with the highest priority given to Level 1 and the lowest priority given to
Level 3. The levels 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 - Generally unobservable inputs, which are developed based on the best information available and may include our own
internal data.
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. Transfers in and out of Level 3 typically
result from derivatives for which fair value is determined based on multiple inputs. If prices change for a particular input from the previous
measurement date to the current measurement date, the impact could result in the derivative being moved between Level 2 and Level 3,
depending upon management judgment of the significance of the price change of that particular input to the total fair value of the derivative.
See Note C of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for more discussion of fair value
measurements.
Derivatives, Accounting for Financially Settled Transactions and Risk Management Activities - We engage in wholesale energy marketing,
retail marketing, trading and risk management activities. We account for derivative instruments utilized in connection with these activities and
services in accordance with Statement 133, as amended.
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Under Statement 133, entities are required to record derivative instruments at fair value, with the exception of normal purchases and normal
sales that are expected to result in physical delivery. See previous discussion in “Fair Value Measurements” for additional
information. Market value changes result in a change in the fair value of our derivative instruments. 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
nature of the risk being hedged and how we will determine if the hedging instrument is effective. If the derivative instrument does not qualify
or is not designated as part of a hedging relationship, then we account for changes in fair value of the derivative in earnings as they
occur. Commodity price volatility may have a significant impact on the gain or loss in any given period. For more information on fair value
sensitivity and a discussion of the market risk of pricing changes, see Item 7A, Quantitative and Qualitative Disclosures about Market Risk.
To reduce our exposure to fluctuations in natural gas, NGLs and condensate prices, we periodically enter into futures, forwards, options or
swap transactions in order to hedge anticipated purchases and sales of natural gas, NGLs and condensate and fuel requirements. Interest-rate
swaps are also used to manage interest-rate risk. Under certain conditions, we designate these derivative instruments as a hedge of exposure
to changes in fair values or cash flow. For hedges of exposure to changes in cash flow, the effective portion of the gain or loss on the
derivative instrument is reported initially as a component of accumulated other comprehensive income (loss) and is subsequently recorded to
earnings when the forecasted transaction affects earnings. Any ineffectiveness of designated hedges is reported in earnings during the
period the ineffectiveness occurs. For hedges of exposure to changes in fair value, the gain or loss on the derivative instrument is recognized
in earnings during the period of change together with the offsetting gain or loss on the hedged item attributable to the risk being hedged.
Upon election, many of our purchase and sale agreements that otherwise would be required to follow derivative accounting qualify as normal
purchases and normal sales under Statement 133 and are therefore exempt from fair value accounting treatment.
The presentation of settled derivative instruments on either a gross or net basis in our Consolidated Statements of Income is dependent on a
number of factors, including whether the derivative instrument (i) is held for trading purposes; (ii) is financially settled; (iii) results in physical
delivery or services rendered; and (iv) qualifies for the normal purchase or sale exception as defined in Statement 133. In accordance with EITF
03-11, “Reporting Realized Gains and Losses on Derivative Instruments That Are Subject to FASB Statement No. 133 and not ‘Held for
Trading’ as Defined in EITF Issue No. 02-3,” EITF 99-19, “Reporting Revenue Gross as a Principal versus Net as an Agent,” and Statement
133, we report settled derivative instruments as follows:
•all financially settled derivative contracts are reported on a net basis;
•derivative instruments considered held for trading purposes that result in physical delivery are reported on a net basis;
•derivative instruments not considered held for trading purposes that result in physical delivery or services rendered are reported on a
gross basis; and
•derivatives that qualify for the normal purchase or sale exception as defined in Statement 133 are reported on a gross basis.
We apply the indicators in EITF 99-19 to determine the appropriate accounting treatment for non-derivative contracts that result in physical
delivery.
See Note D of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for additional discussion of derivatives and
risk management activities.
Impairment of Long-Lived Assets, Goodwill and Intangible Assets - We assess our long-lived assets for impairment based on Statement 144,
“Accounting for the Impairment or Disposal of Long-Lived Assets.” A long-lived asset is tested for impairment whenever events or changes
in circumstances indicate that its carrying amount may exceed its fair value. Fair values are based on the sum of the undiscounted future cash
flows expected to result from the use and eventual disposition of the assets.
We assess our goodwill and indefinite-lived intangible assets for impairment at least annually based on Statement 142, “Goodwill and Other
Intangible Assets.” There were no impairment charges resulting from our July 1, 2008, impairment test. As a result of recent events in the
financial markets and current economic conditions, we performed a review and determined that interim testing of goodwill as of December 31,
2008, was not necessary. As a part of our impairment test, an initial assessment is made by comparing the fair value of a reporting unit with its
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
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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 of the reporting unit 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.
We use two generally accepted valuation approaches, an income approach and a market approach, to estimate the fair value of a reporting
unit. Under the income approach, we use anticipated cash flows over a three-year period plus a terminal value and discount these amounts to
their present value using appropriate rates of return. Under the market approach, we apply multiples to forecasted EBITDA amounts. The
multiples used are consistent with historical asset transactions, and the EBITDA amounts are based on average EBITDA for a reporting unit
over a three-year forecasted period. At December 31, 2008 we had $602.8 million of goodwill recorded on our Consolidated Balance Sheet as
shown below.
(Thousands of dollars)
ONEOK Partners $ 433,537
Distribution 157,953
Energy Services 10,255
Other 1,099
Total goodwill $ 602,844
Intangible assets with a finite useful life are amortized over their estimated useful life, while intangible assets with an indefinite useful life are
not amortized. All intangible assets are subject to impairment testing. We had $435.4 million of intangible assets recorded on our
Consolidated Balance Sheet as of December 31, 2008, of which $279.8 million in our ONEOK Partners segment is being amortized over an
aggregate weighted-average period of 40 years, while the remaining balance has an indefinite life.
Our impairment tests require the use of assumptions and estimates. 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 an impairment charge.
During 2006, we recorded a goodwill and asset impairment related to ONEOK Partners’ Black Mesa Pipeline of $8.4 million and $3.6 million,
respectively, which was recorded as depreciation and amortization. The reduction to our net income, net of minority interests and income
taxes, was $3.0 million.
For the investments we account for under the equity method, the premium or excess cost over underlying fair value of net assets is referred to
as equity method goodwill and under Statement 142, is not subject to amortization but rather to impairment testing pursuant to APB Opinion
No. 18, “The Equity Method of Accounting for Investments in Common Stock.” The impairment test under APB Opinion No. 18 considers
whether the fair value of the equity investment as a whole, not the underlying net assets, has declined and whether that decline is other than
temporary. Therefore, we periodically reevaluate the amount at which we carry the excess of cost over fair value of net assets accounted for
under the equity method to determine whether current events or circumstances warrant adjustments to our carrying value in accordance with
APB Opinion No. 18.
Pension and Postretirement Employee Benefits - We have defined benefit retirement plans covering certain full-time employees. We sponsor
welfare plans that provide postretirement medical and life insurance benefits to certain employees who retire with at least five years of
service. Our actuarial consultant calculates the expense and liability 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 obligations and costs, assumptions can change
from period to period and result in material changes in the costs and liabilities we recognize. See Note J of the Notes to Consolidated Financial
Statements in this Annual Report on Form 10-K for additional information.
Assumed health care cost trend rates have a significant effect on the amounts reported for our health care plans. A one-percentage point
change in assumed health care cost trend rates would have the following effects.
One-Percentage One-Percentage
Point Increase Point Decrease
Effect on total of service and interest cost $ 1,989 $ (1,706)
Effect on postretirement benefit obligation $ 19,585 $ (17,171)
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During 2008, we recorded net periodic benefit costs of $19.8 million related to our defined benefit pension plans and $28.3 million related to
postretirement benefits. We estimate that in 2009, we will record net periodic benefit costs of $26.6 million related to our defined benefit
pension plans and $26.1 million related to postretirement benefits. In determining our estimated expenses for 2009, our actuarial consultant
assumed an 8.50 percent expected return on plan assets and a discount rate of 6.25 percent. A decrease in our expected return on plan assets
to 8.25 percent would increase our 2009 estimated net periodic benefit costs by approximately $1.9 million for our defined benefit pension plans
and would not have a significant impact on our postretirement benefit plan. A decrease in our assumed discount rate to 6.00 percent would
increase our 2009 estimated net periodic benefit costs by approximately $2.4 million for our defined benefit pension plans and $0.6 million for
our postretirement benefit plan. For 2009, we anticipate our total contributions to our defined benefit pension plans and postretirement benefit
plan to be $31.2 million and $11.4 million, respectively, and the expected benefit payments for our postretirement benefit plan are estimated to
be $16.2 million.
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 in accordance with Statement 5, “Accounting for Contingencies.” We base our
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 completion of the 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 K of the Notes to Consolidated Financial Statements in
this Annual Report on Form 10-K for additional discussion of contingencies.
FINANCIAL RESULTS AND OPERATING INFORMATION
Consolidated Operations
Selected Financial Results - The following table sets forth certain selected financial results for the periods indicated.
Variances Variances
Years Ended December 31, 2008 vs. 2007 2007 vs. 2006
Financial Results 2008 2007 2006 Increase (Decrease) Increase (Decrease)
(Millions of dollars)
Revenues $ 16,157.4 $ 13,477.4 $ 11,920.3 $ 2,680.0 20% $ 1,557.1 13%
Cost of sales and fuel 14,221.9 11,667.3 10,198.3 2,554.6 22% 1,469.0 14%
Net margin 1,935.5 1,810.1 1,722.0 125.4 7% 88.1 5%
Operating costs 776.9 761.5 740.8 15.4 2% 20.7 3%
Depreciation and amortization 243.9 228.0 235.5 15.9 7% (7.5) (3%)
Gain (loss) on sale of assets 2.3 1.9 116.5 0.4 21% (114.6) (98%)
Operating income $ 917.0 $ 822.5 $ 862.2 $ 94.5 11% $ (39.7) (5%)
Equity earnings from investments $ 101.4 $ 89.9 $ 95.9 $ 11.5 13% $ (6.0) (6%)
Allowance for equity funds used
during construction $ 50.9 $ 12.5 $ 2.2 $ 38.4 * $ 10.3 *
Other income (expense) $ (10.6) $ 14.1 $ 1.9 $ (24.7) * $ 12.2 *
Interest expense $ (264.2) $ (256.3) $ (239.7) $ 7.9 3% $ 16.6 7%
Minority interests in income of
consolidated subsidiaries $ (288.6) $ (193.2) $ (222.0) $ 95.4 49% $ (28.8) (13%)
Capital expenditures $ 1,473.1 $ 883.7 $ 376.3 $ 589.4 67% $ 507.4 *
* Percentage change is greater than 100 percent.
2008 vs. 2007 - Net margin increased primarily due to wider NGL product price differentials, higher realized commodity prices, incremental net
margin associated with the assets acquired from Kinder Morgan, and increased NGL gathering and fractionation volumes, all in our ONEOK
Partners segment. Additionally, net margin increased due to implementation of new rate mechanisms in our Distribution segment. These
increases were partially offset by decreases in storage and marketing margins and transportation margins, net of hedging activities, in our
Energy Services segment.
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Operating costs increased primarily due to incremental operating expenses associated with the assets acquired from Kinder Morgan, outside
services primarily associated with scheduled maintenance expenses at ONEOK Partners’ Medford and Mont Belvieu fractionators, and
chemical costs. Operating costs also increased due to costs associated with the startup of the newly expanded Bushton fractionator and
Overland Pass Pipeline, both in our ONEOK Partners segment.
Depreciation and amortization increased primarily due to the assets acquired from Kinder Morgan and depreciation expense associated with
ONEOK Partners’ completed capital projects. Additionally, our Distribution segment had an increase in depreciation and amortization,
primarily due to additional investment in property, plant and equipment.
Equity earnings from investments increased primarily due to ONEOK Partners’ share of the gain on the sale of Bison Pipeline LLC by Northern
Border Pipeline and ONEOK Partners’ earnings related to higher gathering revenues in its natural gas gathering and processing business’
various investments, partially offset by reduced throughput on Northern Border Pipeline. ONEOK Partners owns a 50 percent equity interest
in Northern Border Pipeline.
Allowance for equity funds used during construction and capital expenditures increased due to ONEOK Partners’ capital projects.
Other income (expense) fluctuated primarily due to investment gains (losses) and fluctuations in interest income. In addition, other income
(expense) was impacted by realized and unrealized gains on available-for-sale securities sold and transferred to trading. Our available-for-sale
securities were reclassified to trading securities due to a reconsideration event in August 2008 when our NYMEX Holding, Inc. Class A shares
held were converted to CME Group, Inc. (CME) Class A shares, due to the NYMEX Holding, Inc. and CME merger. A modification was made
to the number of shares required to be maintained by NYMEX Holding, Inc. Class A Members, which resulted in our sale of certain shares and
the reclassification of the remaining shares to trading.
Interest expense increased primarily due to increased borrowings to fund ONEOK Partners’ capital projects.
Minority interest in income of consolidated subsidiaries for 2008 and 2007 reflects the remaining 52.3 percent and 54.3 percent, respectively, of
ONEOK Partners that we did not own. The increase in minority interest is due to the increase in income for our ONEOK Partners segment,
partially offset by our increased equity ownership interest in ONEOK Partners.
2007 vs. 2006 - Net margin increased primarily due to the implementation of new rate schedules in Kansas and Texas in our Distribution
segment. Net margin was also positively impacted by our ONEOK Partners segment due to its natural gas liquids businesses, which benefited
primarily from new supply connections that increased volumes gathered, transported, fractionated and sold. Net margin also increased due to
ONEOK Partners’ natural gas liquids gathering and fractionation business benefiting from higher product price differentials and higher
isomerization price differentials, as well as the incremental net margin related to the assets acquired from Kinder Morgan in October
2007. These increases were offset by decreased transportation margins in our Energy Services segment and decreased net margin in ONEOK
Partners’ natural gas gathering and processing business, primarily due to lower natural gas volumes processed as a result of contract
terminations in late 2006.
Gain on sale of assets decreased primarily due to the $113.9 million gain on sale of a 20 percent partnership interest in Northern Border Pipeline
recorded in the second quarter of 2006 in our ONEOK Partners segment.
Equity earnings from investments decreased primarily due to the decrease in ONEOK Partners’ share of Northern Border Pipeline’s earnings
from 70 percent in the first quarter of 2006 to 50 percent beginning in the second quarter of 2006.
Other income (expense) fluctuated primarily due to increased civic donations and expenses incurred by ONEOK Partners in 2006 related to
costs associated with transitioning operations from Omaha, Nebraska.
Interest expense increased primarily due to the additional borrowings by ONEOK Partners to complete the April 2006 transactions with
us. The additional borrowings resulted in $21.3 million in higher interest expense in the first quarter of 2007. Increased interest expense was
partially offset by lower interest expense on ONEOK’s short-term debt of $11.8 million during 2007, as a result of the proceeds from the sale of
assets to ONEOK Partners, which reduced ONEOK’s short-term debt.
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Minority interest in income of consolidated subsidiaries for 2007 and 2006 reflects the remaining 54.3 percent of ONEOK Partners that we did
not own. For 2007, minority interest was lower due to the $113.9 million gain on sale of a 20 percent partnership interest in Northern Border
Pipeline recorded in the second quarter of 2006 in our ONEOK Partners segment. Additionally, minority interest in net income of consolidated
subsidiaries for our ONEOK Partners’ segment for 2006 included the 66-2/3 percent interest in Guardian Pipeline that ONEOK Partners did not
own until April 2006. ONEOK Partners owned 100 percent of Guardian Pipeline beginning in April 2006, resulting in no minority interest in
income of consolidated subsidiaries related to Guardian Pipeline after March 31, 2006.
More information regarding our results of operations is provided in the following discussion of operating results for each of our segments.
ONEOK Partners
Selected Financial Results and Operating Information - The following tables set forth certain selected financial results and operating
information for our ONEOK Partners segment for the periods indicated.
Variances Variances
Revenues $ 7,720.2 $ 5,831.6 $ 4,738.2 $ 1,888.6 32% $ 1,093.4 23%
Cost of sales and fuel 6,579.5 4,935.7 3,894.7 1,643.8 33% 1,041.0 27%
Net margin 1,140.7 895.9 843.5 244.8 27% 52.4 6%
Operating costs 371.8 337.4 325.8 34.4 10% 11.6 4%
Depreciation and amortization 124.8 113.7 122.0 11.1 10% (8.3) (7%)
Gain on sale of assets 0.7 2.0 115.5 (1.3) (65% ) (113.5) (98%)
Operating income $ 644.8 $ 446.8 $ 511.2 $ 198.0 44% $ (64.4) (13%)
Equity earnings from investments $ 101.4 $ 89.9 $ 95.9 $ 11.5 13% $ (6.0) (6%)
Allowance for equity funds used
during construction $ 50.9 $ 12.5 $ 2.2 $ 38.4 * $ 10.3 *
Minority interests in income of
consolidated subsidiaries $ (0.4) $ (0.4) $ (2.4) $ - 0% $ 2.0 83%
Capital expenditures $ 1,253.9 $ 709.9 $ 201.7 $ 544.0 77% $ 508.2 *

Operating Information 2008 2007 2006
Natural gas gathered (BBtu/d) (a) 1,164 1,171 1,168
Natural gas processed (BBtu/d) (a) 641 621 988
Natural gas transported (MMcf/d) 3,665 3,579 3,634
Residue gas sales (BBtu/d) (a) 279 281 302
NGLs gathered (MBbl/d) 276 248 226
NGL sales (MBbl/d) 283 231 207
NGLs fractionated (MBbl/d) 373 356 313
NGLs transported (MBbl/d) 333 299 200
Conway-to-Mont Belvieu OPIS average price differential
Ethane ($/gallon) $ 0.15 $ 0.06 $ 0.05
Realized composite NGL sales prices ($/gallon) (a) $ 1.27 $ 1.06 $ 0.93
Realized condensate sales price ($/Bbl) (a) $ 89.30 $ 67.35 $ 57.84
Realized residue gas sales price ($/MMBtu) (a) $ 7.34 $ 6.21 $ 6.31
Realized gross processing spread ($/MMBtu) (a) $ 7.47 $ 5.21 $ 5.05
(a) - Statistics relate to ONEOK Partners’ natural gas gathering and processing business.
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2008 vs. 2007 - Net margin increased primarily due to the following:
•an increase in ONEOK Partners’ natural gas liquids gathering and fractionation business due to the following:
o an increase of $70.8 million in wider NGL product price differentials;
o an increase of $32.1 million due to increased NGL gathering and fractionation volumes; and
o an increase of $8.4 million in certain operational measurement gains, primarily at NGL storage caverns;
•an increase in ONEOK Partners’ natural gas gathering and processing business due to the following:
o an increase of $58.4 million due to higher realized commodity prices;
o an increase of $11.9 million due to improved contractual terms;
o an increase of $7.0 million due to higher volumes sold and processed; partially offset by
o a decrease of $8.6 million due to a one-time favorable contract settlement that occurred in the fourth quarter of 2007;
•an increase of $44.3 million in incremental margin in ONEOK Partners’ natural gas liquids pipelines business, due to the assets
acquired from Kinder Morgan in October 2007, including $10.3 million due to increased throughput during the fourth quarter of 2008,
compared with the fourth quarter of 2007;
•an increase of $11.7 million due to increased transportation and storage margins primarily as a result of the impact of higher natural
gas prices on retained fuel, and new and renegotiated storage contracts in ONEOK Partners’ natural gas pipelines business; and
•an increase of $6.9 million primarily due to increased throughput from new NGL supply connections, including $2.6 million from
Overland Pass Pipeline, which began operations during the fourth quarter 2008.
Operating costs increased primarily due to incremental operating expenses associated with the assets acquired from Kinder Morgan, outside
service costs primarily associated with scheduled maintenance expenses at ONEOK Partners’ Medford and Mont Belvieu fractionators, and
chemical costs. Operating costs also increased due to costs associated with the startup of ONEOK Partners’ newly expanded Bushton
fractionator and Overland Pass Pipeline.
Depreciation and amortization increased primarily due to depreciation expense associated with ONEOK Partners’ completed capital projects
and the assets acquired from Kinder Morgan.
Equity earnings from investments increased primarily due to higher gathering revenues in ONEOK Partners’ various investments, as well as a
$8.3 million gain on the sale of Bison Pipeline LLC by Northern Border Pipeline, partially offset by reduced throughput on Northern Border
Pipeline. ONEOK Partners owns a 50 percent equity interest in Northern Border Pipeline.
2007 vs. 2006 - Net margin increased primarily due to the following:
•an increase of $27.3 million from increased performance of ONEOK Partners’ natural gas liquids businesses, which benefited primarily
from new supply connections that increased volumes gathered, transported, fractionated and sold;
•an increase of $20.6 million from new and renegotiated contractual terms and increased volumes in ONEOK Partners’ natural gas and
natural gas liquids businesses;
•an increase of $13.5 million in higher NGL product price differentials and higher isomerization price differentials in ONEOK Partners’
natural gas liquids gathering and fractionation business;
•an increase of $11.5 million in incremental net margin in ONEOK Partners’ natural gas liquids pipeline business, due to the assets
acquired from Kinder Morgan in October 2007; and
•an increase of $5.4 million in storage margins in ONEOK Partners’ natural gas pipelines business; partially offset by
•a decrease of $32.9 million in natural gas processing and transportation margins in ONEOK Partners’ natural gas businesses resulting
primarily from lower throughput, higher fuel costs and lower volumes processed as a result of various contract terminations.
Operating costs increased primarily due to higher employee-related costs and the incremental operating expenses associated with the assets
acquired from Kinder Morgan, partially offset by lower litigation costs.
Depreciation and amortization decreased primarily due to a goodwill and asset impairment charge of $12.0 million recorded in the second
quarter of 2006 related to Black Mesa Pipeline.
Gain on sale of assets decreased primarily due to the $113.9 million gain on the sale of a 20 percent partnership interest in Northern Border
Pipeline recorded in the second quarter of 2006.
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Equity earnings from investments primarily include earnings from ONEOK Partners’ interest in Northern Border Pipeline. The decrease for
2007 was primarily due to the decrease in ONEOK Partners’ share of Northern Border Pipeline’s earnings from 70 percent in the first quarter of
2006 to 50 percent beginning in the second quarter of 2006. See page 85 for discussion of the disposition of the 20 percent partnership interest
in Northern Border Pipeline.
Minority interest in income of consolidated subsidiaries decreased primarily due to our acquisition of the remaining interest in Guardian
Pipeline. Minority interest in net income of consolidated subsidiaries for our ONEOK Partners’ segment for 2006 included the 66-2/3 percent
interest in Guardian Pipeline that ONEOK Partners did not own until April 2006. ONEOK Partners owned 100 percent of Guardian Pipeline
beginning in April 2006, resulting in no minority interest in income of consolidated subsidiaries related to Guardian Pipeline after March 31,
2006.
Commodity Price Risk - ONEOK Partners is exposed to commodity price risk, primarily from NGLs, as a result of its contractual obligations for
services provided. A small percentage of its services, based on volume, is provided through keep-whole arrangements. See discussion
regarding ONEOK Partners’ commodity price risk beginning on page 63 under “Commodity Price Risk” in Item 7A, Quantitative and Qualitative
Disclosures about Market Risk.
Distribution
Selected Financial Results - The following table sets forth certain selected financial results for our Distribution segment for the periods
indicated.
Variances Variances
Gas sales $ 2,049.0 $ 1,976.3 $ 1,836.9 $ 72.7 4% $ 139.4 8%
Transportation revenues 87.3 87.3 88.3 - 0% (1.0) (1%)
Cost of gas 1,496.7 1,435.4 1,358.4 61.3 4% 77.0 6%
Net margin, excluding other 639.6 628.2 566.8 11.4 2% 61.4 11%
Other revenues 41.3 35.4 33.0 5.9 17% 2.4 7%
Net margin 680.9 663.6 599.8 17.3 3% 63.8 11%
Operating costs 375.3 377.8 371.5 (2.5) (1% ) 6.3 2%
Depreciation and amortization 116.8 111.6 110.9 5.2 5% 0.7 1%
Gain (loss) on sale of assets - (0.1) - 0.1 100% (0.1) (100%)
Operating income $ 188.8 $ 174.1 $ 117.4 $ 14.7 8% $ 56.7 48%
Capital expenditures $ 169.0 $ 162.0 $ 159.0 $ 7.0 4% $ 3.0 2%
2008 vs. 2007 - Net margin increased primarily due to:

•an increase of $15.7 million resulting from the implementation of new rate mechanisms, which includes a $12.4 million increase in
Oklahoma and a $3.3 million increase in Texas; and
•an increase of $2.2 million related to recovery of carrying costs for natural gas in storage.
Operating costs decreased primarily due to:

•a decrease of $4.3 million in employee-related costs; and
•a decrease of $1.0 million in bad debt expense; partially offset by
•an increase of $2.4 million in fuel-related vehicle costs.
Depreciation and amortization increased primarily due to:

•an increase of $4.0 million in depreciation expense related to our investment in property, plant and equipment; and
•an increase of $1.2 million of regulatory amortization associated with revenue rider recoveries.
2007 vs. 2006 - Net margin increased primarily due to:

•an increase of $55.2 million resulting from the implementation of new rate schedules, which includes $51.1 million in Kansas and $4.1
million in Texas; and
•an increase of $8.0 million from higher customer sales volumes as a result of a return to more normal weather in our entire service
territory.
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Operating costs increased primarily due to:

•an increase of $4.8 million in bad debt expense, primarily in Oklahoma; and
•an increase of $5.3 million due to higher property taxes in Kansas; partially offset by
•a decrease of $4.0 million in labor and employee benefit costs.
Capital Expenditures - Our capital expenditure program includes expenditures for extending service to new areas, modifying customer service
lines, increasing system capabilities, general replacements and improvements. It is our practice to maintain and upgrade facilities to ensure
safe, reliable and efficient operations. Our capital expenditure program included $51.8 million, $50.6 million and $54.9 million for new business
development in 2008, 2007 and 2006, respectively.
Selected Operating Information - - The following tables set forth certain selected operating information for our Distribution segment for the
periods indicated.

Customers per employee 719 732 713
Inventory storage balance (Bcf) 25.1 22.7 26.3

Volumes (MMcf) 2008 2007 2006
Gas sales
Residential 125,834 121,587 110,123
Commercial 37,758 37,295 34,865
Industrial 1,395 1,758 1,624
Wholesale 7,186 13,231 29,263
Public Authority 2,592 2,679 2,520
Total volumes sold 174,765 176,550 178,395
Transportation 219,398 204,049 200,828
Total volumes delivered 394,163 380,599 379,223

Margin 2008 2007 2006
Gas Sales (Millions of dollars)
Residential $ 444.0 $ 440.9 $ 390.2
Commercial 101.3 99.5 88.8
Industrial 2.6 2.3 2.9
Wholesale 0.6 1.2 4.8
Public Authority 3.8 3.7 3.2
Net margin on gas sales 552.3 547.6 489.9
Transportation revenues 87.3 80.6 76.9
Net margin, excluding other $ 639.6 $ 628.2 $ 566.8

Number of Customers 2008 2007 2006
Residential 1,886,118 1,876,054 1,859,480
Commercial 159,748 160,517 159,214
Industrial 1,420 1,455 1,528
Wholesale 28 27 18
Public Authority 2,963 2,952 2,645
Transportation 10,376 9,762 8,666
Total customers 2,060,653 2,050,767 2,031,551
Residential volumes increased during 2008, compared with 2007, due to colder temperatures in our Oklahoma and Kansas service territories;
however, margins were moderated by weather normalization mechanisms.
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Residential and commercial volumes increased during 2007, compared with 2006, primarily due to a return to more normal weather from the
unseasonably warm weather in 2006.
Wholesale sales represent contracted gas volumes that exceed the needs of our residential, commercial and industrial customer base and are
available for sale to other parties. Wholesale volumes decreased during 2008, compared with 2007 and 2006, due to reduced volumes available
for sale.
Public authority natural gas volumes reflect volumes used by state agencies and school districts served by Texas Gas Service.
Transportation margins increased during 2008, compared with 2007, primarily due to increased transportation volumes in Oklahoma and
Kansas.
Regulatory Initiatives
Oklahoma - In August 2007, Oklahoma Natural Gas filed an application for authorization of a capital investment recovery mechanism. In
February 2008, the OCC approved a joint stipulation, which allows Oklahoma Natural Gas to collect a rate of return, depreciation and 50 percent
of the property tax expense associated with non-revenue producing incremental capital investments since its 2005 rate case. The rates, which
were effective in March 2008, generated margins of approximately $7.7 million in 2008. In July 2008, Oklahoma Natural Gas filed to increase the
capital investment recovery mechanism from $7.6 million to $12.6 million annually. In October 2008, the parties signed a joint stipulation
approving the request, and an administrative law judge of the OCC subsequently recommended approval of the joint stipulation. The final
order was approved by the OCC in December 2008, and the increased recovery level was effective in January 2009.
The OCC has authorized Oklahoma Natural Gas to defer transmission pipeline Integrity Management Program (IMP) costs incurred (inclusive
of operations and maintenance expense, depreciation, property taxes and a rate of return) in compliance with the Federal Pipeline Safety
Improvement Act of 2002. On January 31, 2007, Oklahoma Natural Gas filed the first application with the OCC seeking recovery of these
costs. On August 31, 2007, the OCC issued an order approving a stipulation of the parties, which provided for recovery of $7.2 million in IMP
deferrals incurred as of July 31, 2007, and these deferrals were recovered during the months of October 2007 through June 2008.
The second IMP application was made at the OCC on January 31, 2008, and covered the IMP deferrals for the months of August through
December 2007 and the true-ups associated with the prior recovery period. This filing also requested $7.2 million to be recovered with a new
IMP billing rate to be put in place in July 2008. The OCC approved this request, and billings under the 2008 IMP application began in July
2008. The third IMP application was made at the OCC on January 30, 2009, and covered the IMP deferrals for 2008, and the true-ups
associated with the prior recovery period. This filing requests a total of $10.8 million with a new IMP billing rate to be put in place in July
2009. Oklahoma Natural Gas will continue to defer IMP costs as they are incurred and will make future filings to recover those costs.
In August 2008, Oklahoma Natural Gas filed with the OCC for approval to include the fuel-related portion of bad debts in the Purchased Gas
Adjustment mechanism for cost recovery. In October 2008, all parties signed the joint stipulation approving the request, and an administrative
law judge of the OCC subsequently recommended approval of the joint stipulation. The joint stipulation allows Oklahoma Natural Gas to
begin deferring its fuel-related bad debts beginning in January 2009 and to collect those amounts above the levels in base rates through the
Purchased Gas Adjustment beginning in January 2010. The final order was issued by the OCC in December 2008. The associated deferrals
began in January 2009.
In October 2008, a joint application for incentive-based rates was filed by the OCC staff and Oklahoma Natural Gas. This application proposes
that the OCC adopt an incentive-based rate design and more streamlined regulatory process. If approved, this will provide for more timely rate
changes.
Kansas - In October 2006, Kansas Gas Service reached a settlement with the KCC staff and all other parties to increase annual revenues by
approximately $52 million. The terms of the settlement were approved by the KCC in November 2006. The rate increase is effective for services
rendered on or after January 1, 2007.
In August 2008, Kansas Gas Service filed an application with the KCC to impose a surcharge designed to annually collect approximately $2.9
million in costs associated with its Gas System Reliability Surcharge (GSRS) mechanism. The GSRS mechanism allows natural gas utilities to
earn a return and recover carrying costs associated with investments made to comply with state and federal pipeline safety requirements or
costs to relocate existing facilities pursuant to requests made by a government entity. The KCC approved the request in December 2008, with
authorized GSRS collections effective with customer billings on January 1, 2009.
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Texas - Texas Gas Service has received several regulatory approvals to implement rate increases in various municipalities in Texas. A total of
$1.7 million in annual rate increases were approved and implemented in 2007. A total of $5.5 million in annual rate increases were approved and
implemented in 2006.
In August 2007, Texas Gas Service filed for a rate adjustment with the city of El Paso, Texas, and the municipalities of Anthony, Clint, Horizon
City, Socorro and Vinton. Texas Gas Service requested a total annual increase of $5.5 million. In February 2008, the El Paso City Council
approved an annual rate increase of approximately $3.1 million. The increase was effective in February 2008.
In April 2008, the RRC approved a rate increase in our South Texas jurisdiction. The rate increase was effective May 2008 and will increase
revenues by $1.1 million annually.
In May 2008, Texas Gas Service filed for interim rate relief under the Gas Reliability Infrastructure Program with the city of El Paso, Texas, and
surrounding communities for approximately $1.1 million. This program 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. In August 2008, an annual rate
increase of approximately $1.0 million was approved; the new rates were effective in September 2008.
In February 2009, Texas Gas Service filed a statement of intent to increase rates in its central Texas service area for approximately $3.6
million. If approved, new rates are expected to become effective in June 2009.
General - Certain costs to be recovered through the ratemaking process have been recorded as regulatory assets in accordance with
Statement 71, “Accounting for the Effects of Certain Types of Regulation.” Should recovery cease due to regulatory actions, certain of these
assets may no longer meet the criteria of Statement 71, and accordingly, a write-off of regulatory assets and stranded costs may be required.
Energy Services
Selected Financial Results - The following table sets forth certain selected financial results for our Energy Services segment for the periods
indicated.
Variances Variances
Revenues $ 7,585.8 $ 6,629.4 $ 6,335.8 $ 956.4 14% $ 293.6 5%
Cost of sales and fuel 7,475.1 6,382.0 6,062.0 1,093.1 17% 320.0 5%
Net margin 110.7 247.4 273.8 (136.7) (55% ) (26.4) (10%)
Operating costs 35.6 39.9 42.5 (4.3) (11% ) (2.6) (6%)
Depreciation and amortization 0.9 2.1 2.1 (1.2) (57% ) - 0%
Gain on sale of assets 1.5 - - 1.5 100% - 0%
Operating income $ 75.7 $ 205.4 $ 229.2 $ (129.7) (63% ) $ (23.8) (10%)
Capital expenditures $ 0.1 $ 0.2 $ - $ (0.1) (50% ) $ 0.2 100%
Energy markets were affected by higher commodity prices during 2008, compared with 2007. The increase in commodity prices had a direct
impact on our revenues and the cost of sales and fuel.
2008 vs. 2007 - Net margin decreased primarily due to the following:
•a net decrease of $40.3 million in transportation margins, net of hedging activities, primarily due to decreased basis differentials
between the Rocky Mountain and Mid-Continent regions, and increased transportation-related costs in 2008;
•a decrease of $13.9 million in financial trading margins; and
•a net decrease of $83.3 million in storage and marketing margins, net of hedging activities, primarily due to:
o a net decrease of $87.3 million in physical storage margins net of hedging activities, as a result of:
•hedging opportunities associated with weather related events that led to higher storage margins in 2007 compared with
2008;
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•lower 2008 storage margins related to storage risk management positions and the impact of changes in natural gas prices
on these positions; and
•fewer opportunities to optimize storage capacity due to the significant decline in natural gas prices in the second half of
2008;
o a decrease of $9.7 million in physical storage margins due to a lower of cost or market write-down on natural gas inventory;
and
o a decrease of $2.1 million due to colder than anticipated weather and market conditions that increased the supply cost of
managing our peaking and load-following services and provided fewer opportunities to increase margins through
optimization activities, primarily in the first quarter of 2008; partially offset by
o an increase of $15.8 million from changes in the unrealized fair value of derivative instruments associated with storage and
marketing activities and improved marketing margins, which benefited from price movements and optimization activities.
Operating costs decreased primarily due to lower employee-related costs and depreciation expense.
2007 vs. 2006 - Net margin decreased primarily due to:

•a decrease of $22.0 million in transportation margins, net of hedging activities, associated with changes in the unrealized fair value of
derivative instruments and the impact of a force majeure event on the Cheyenne Plains Gas Pipeline, as more fully described below;
•a decrease of $5.0 million in retail activities from lower physical margins due to market conditions and increased competition;
•a decrease of $4.3 million in financial trading margins that was partially offset by
•an increase of $4.9 million in storage and marketing margins, net of hedging activities, related to:
o an increase in physical storage margins, net of hedging activity, due to higher realized seasonal storage spreads and
optimization activities; partially offset by
o a decrease in marketing margins; and
o a net increase in the cost associated with managing our peaking and load following services, slightly offset by higher
demand fees collected for these services.
In September 2007, a portion of the volume contracted under our firm transportation agreement with Cheyenne Plains Gas Pipeline Company
was curtailed due to a fire at a Cheyenne Plains pipeline compressor station. The fire damaged a significant amount of instrumentation and
electrical wiring, causing Cheyenne Plains Gas Pipeline Company to declare a force majeure event on the pipeline. This firm commitment was
hedged in accordance with Statement 133. The discontinuance of fair value hedge accounting on the portion of the firm commitment that was
impacted by the force majeure event resulted in a loss of approximately $5.5 million that was recognized in the third quarter of 2007, of which
$2.4 million of insurance proceeds were recovered and recognized in the first quarter of 2008. Cheyenne Plains Gas Pipeline Company resumed
full operations in November 2007.
Operating costs decreased primarily due to decreased legal and employee-related costs, and reduced ad-valorem tax expense.
Selected Operating Information - - The following table sets forth certain selected operating information for our Energy Services segment for
the periods indicated.

Natural gas marketed (Bcf) 1,160 1,191 1,132
Natural gas gross margin ($/Mcf) $ 0.07 $ 0.19 $ 0.22
Physically settled volumes (Bcf) 2,359 2,370 2,288
Our natural gas in storage at December 31, 2008, was 81.9 Bcf, compared with 66.7 Bcf at December 31, 2007. At December 31, 2008, our total
natural gas storage capacity under lease was 91 Bcf, compared with 96 Bcf at December 31, 2007.
Natural gas volumes marketed decreased slightly during 2008, compared with 2007, due to increased injections in the third quarter of 2008. In
addition, demand for natural gas was impacted by weather-related events in the third quarter of 2008, including a 15 percent decrease in
cooling degree-days and demand disruption caused by Hurricane Ike.
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Natural gas volumes marketed increased during 2007, compared with 2006, due to an increase in sales activity in the southeastern United
States in the third quarter of 2007. Natural gas volumes were also impacted by a 14 percent increase in heating degree-days in our service
territory, compared with the same period in 2006.
The acquisition of natural gas storage capacity is more competitive as a result of new market entrants. The increased demand for storage
capacity has resulted in an increase in both the cost of leasing storage capacity and the required term of the lease. Longer terms and increased
costs for storage capacity leases could result in significant increases in the cost of our contractual commitments.
The following table shows our margins by activity for the periods indicated.

2008 2007 2006
Marketing, storage and transportation, gross $ 313.4 $ 409.1 $ 414.9
Less: Storage and transportation costs (219.8) (191.9) (180.7)
Marketing, storage and transportation, net 93.6 217.2 234.2
Retail marketing 14.8 14.0 19.0
Financial trading 2.3 16.2 20.6
Net margin $ 110.7 $ 247.4 $ 273.8
Marketing, storage and transportation, net, primarily includes physical marketing, purchases and sales, firm storage and transportation
capacity expense, including the impact of cash flow and fair value hedges, and other derivative instruments used to manage our risk
associated with these activities. Risk management and operational decisions have a significant impact on the net result of our marketing and
storage activities. Origination gains are also a component of marketing activity, which is the fair value recognition of contracts that our
wholesale marketing department structures to meet the risk management needs of our customers.
Retail marketing includes revenues from providing physical marketing and supply services, coupled with risk management services, to
residential, municipal, and small commercial and industrial customers.
Financial trading margin includes activities that are generally executed using financially settled derivatives. These activities are normally short
term in nature, with a focus on capturing short-term price volatility. Revenues in our Consolidated Statements of Income include financial
trading margins, as well as certain physical natural gas transactions with our trading counterparties. Revenues and cost of sales and fuel from
such physical transactions are required to be reported on a net basis.
Contingencies
Legal Proceedings - We are a party to various litigation matters and claims that are normal in the course of our operations. While the results
of litigation and claims cannot be predicted with certainty, we believe the final outcome of such matters will not have a material adverse effect
on our consolidated results of operations, financial position or liquidity.
FERC Matter - As a result of a transaction that was brought to the attention of one of our affiliates by a third party, we conducted an internal
review of transactions that may have violated FERC natural gas capacity release rules or related rules and determined that there were
transactions that should be disclosed to the FERC. We notified the FERC of this review and filed a report with the FERC regarding these
transactions in March 2008. We cooperated fully with the FERC in its investigation of this matter and have taken steps to better ensure that
current and future transactions comply with applicable FERC regulations by implementing a compliance plan dealing with capacity
release. We entered into a global settlement with the FERC to resolve this matter and other FERC enforcement matters, which was approved
by the FERC on January 15, 2009. The global settlement provides for a total civil penalty of $4.5 million and approximately $2.2 million in
disgorgement of profits and interest, of which $1.7 million of the civil penalty was allocated to ONEOK Partners. The amounts were recorded
as a liability on our Consolidated Balance Sheet as of December 31, 2008. We made the required payments in January 2009.
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LIQUIDITY AND CAPITAL RESOURCES
General - Part of our strategy is to grow through acquisitions and internally generated growth projects that strengthen and complement our
existing assets. We have relied primarily on operating cash flow, borrowings from commercial paper and credit agreements, and issuance of
debt and equity in the capital markets for our liquidity and capital resource requirements. We expect to continue to use these sources for
liquidity and capital resource needs on both a short- and long-term basis. We have no material guarantees of debt or other similar
commitments to unaffiliated parties.
During 2008 and continuing into 2009, the capital markets experienced volatility and disruption, which could limit our access to those markets
or increase the cost of issuing new securities in the future. Higher commodity prices and wider basis differentials, particularly in 2008, have
also resulted in higher collateral requirements and natural gas inventory costs in our Energy Services segment. Throughout this period,
ONEOK has continued to have access to its $1.2 billion revolving credit agreement (ONEOK Credit Agreement); also, ONEOK Partners has
continued to have access to the ONEOK Partners Credit Agreement, which has been adequate to fund short-term liquidity needs. In addition,
beginning in August 2008, ONEOK had access to its new short-term credit agreement. In the third quarter of 2008, ONEOK began to utilize
both of its credit agreements and lessened its use of commercial paper due to decreased liquidity and rising costs in the commercial paper
market. See discussion below under “Short-term Liquidity.” Also in 2008, ONEOK Partners issued common units and received additional
contributions from ONEOK Partners GP. See discussion below under “Long-term Financing.”
We expect continued deteriorating economic conditions in 2009, with downward pressures, relative to 2008, on commodity prices. We also
expect continued volatility and disruption in the financial markets, which could result in an increased cost of capital. ONEOK and ONEOK
Partners’ ability to continue to access capital markets for debt and equity financing under reasonable terms depends on the Company’s and
Partnership’s respective financial condition, credit ratings and market conditions. ONEOK and ONEOK Partners anticipate that cash flow
generated from operations, existing capital resources and ability to obtain financing will enable both to maintain current levels of operations
and planned operations, collateral requirements and capital expenditures.
Capitalization Structure - The following table sets forth our capitalization structure for the periods indicated.

2008 2007
Long-term debt 67% 70%
Equity 33% 30%
Debt (including notes payable) 76% 71%

Equity 24% 29%
ONEOK does not guarantee the debt of ONEOK Partners. For purposes of determining compliance with financial covenants in the ONEOK
Credit Agreement and ONEOK’s $400 million 364-day revolving credit facility dated August 6, 2008 (the 364-Day Facility), the debt of ONEOK
Partners is excluded. At December 31, 2008, ONEOK’s capitalization structure, excluding the debt of ONEOK Partners, was 44 percent long-
term debt and 56 percent equity, compared with 51 percent long-term debt and 49 percent equity at December 31, 2007. At December 31, 2008,
ONEOK’s capitalization structure, including notes payable and excluding the debt of ONEOK Partners, was 59 percent debt and 41 percent
equity, compared with 52 percent debt and 48 percent equity at December 31, 2007. In February 2008, ONEOK repaid $402.3 million of maturing
long-term debt with cash from operations and short-term borrowings. In February 2009, ONEOK repaid $100 million of maturing long-term debt
with cash from operations and short-term borrowings.
Cash Management - ONEOK and ONEOK Partners each use similar centralized cash management programs that concentrate the cash assets of
their operating subsidiaries in joint accounts for the purpose of providing financial flexibility and lowering the cost of borrowing, transaction
costs and bank fees. Both centralized cash management programs provide that funds in excess of the daily needs of the operating subsidiaries
are concentrated, consolidated or otherwise made available for use by other entities within the respective consolidated groups. ONEOK
Partners’ operating subsidiaries participate in these programs to the extent they are permitted under FERC regulations. Under these cash
management programs, depending on whether a participating subsidiary has short-term cash surpluses or cash requirements, ONEOK and
ONEOK Partners provide cash to their subsidiary or the subsidiary provides cash to them.
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Short-term Liquidity - ONEOK’s principal sources of short-term liquidity consist of cash generated from operating activities, quarterly
distributions from ONEOK Partners, the ONEOK Credit Agreement and the 364-Day Facility, as discussed below. ONEOK also has a
commercial paper program that can be utilized for short-term liquidity needs, to the extent funds are available under the ONEOK Credit
Agreement and the 364-Day Facility. ONEOK Partners’ principal sources of short-term liquidity consist of cash generated from operating
activities and the ONEOK Partners Credit Agreement.
During late 2008, ONEOK and ONEOK Partners decided to borrow under their available credit facilities to fund their respective anticipated
working capital requirements for the remainder of 2008 and into 2009.
In August 2008, ONEOK entered into the 364-Day Facility. The interest rate is based, at ONEOK’s election, on either (i) the higher of prime or
one-half of one percent above the Federal Funds Rate or (ii) the Eurodollar rate plus a set number of basis points based on ONEOK’s current
long-term unsecured debt ratings by Moody’s and S&P. The 364-Day Facility is being used for working capital, capital expenditures and other
general corporate purposes.
In September 2008, ONEOK entered into an amendment to the ONEOK Credit Agreement. The amendment changed certain sublimits but did
not change the lenders’ aggregate commitment to lend up to $1.2 billion under the ONEOK Credit Agreement.
The total amount of short-term borrowings authorized by ONEOK’s Board of Directors is $2.5 billion. At December 31, 2008, ONEOK had no
commercial paper outstanding, $1.4 billion in borrowings outstanding, $64.9 million in letters of credit issued, which includes $64.6 million
under the ONEOK Credit Agreement and an additional $0.3 million in other letters of credit, and available cash and cash equivalents of
approximately $332.4 million. Considering outstanding borrowings, commercial paper and letters of credit under the ONEOK Credit Agreement,
ONEOK had $135.4 million of credit available at December 31, 2008, under the ONEOK Credit Agreement and the 364-Day Facility. As of
December 31, 2008, ONEOK could have issued $1.5 billion of additional short- and long-term debt under the most restrictive provisions
contained in its various borrowing agreements.
The total amount of short-term borrowings authorized by the Board of Directors of ONEOK Partners GP, the general partner of ONEOK
Partners, is $1.5 billion. At December 31, 2008, ONEOK Partners had $870 million in borrowings outstanding and $130 million of credit available
under the ONEOK Partners Credit Agreement and available cash and cash equivalents of approximately $177.6 million. As of December 31,
2008, ONEOK Partners could have issued a $772.6 million of additional short- and long-term debt under the most restrictive provisions of its
agreements.
ONEOK Partners has an outstanding $25 million letter of credit issued by Royal Bank of Canada, which is used for counterparty credit support.
ONEOK Partners also has a $15 million Senior Unsecured Letter of Credit Facility and Reimbursement Agreement with Wells Fargo Bank, N.A.,
of which $12 million is currently being used, and an agreement with Royal Bank of Canada, pursuant to which a $12 million letter of credit was
issued. Both agreements are used to support various permits required by the KDHE for ONEOK Partners’ ongoing business in Kansas.
The ONEOK Credit Agreement and the 364-Day Facility contain certain financial, operational and legal covenants. These requirements
include, among others:
•a $400 million sublimit for the issuance of standby letters of credit;
•a limitation on ONEOK’s stand-alone debt-to-capital ratio, which may not exceed 67.5 percent at the end of any calendar quarter;
•a requirement that ONEOK maintains the power to control the management and policies of ONEOK Partners,
•a limit on new investments in master limited partnerships; and
•other customary affirmative and negative covenants, including covenants relating to liens, investments, fundamental changes in
ONEOK’s businesses, changes in the nature of ONEOK’s businesses, transactions with affiliates, the use of proceeds and a
covenant that prevents ONEOK from restricting its subsidiaries’ ability to pay dividends.
The debt covenant calculations in the ONEOK Credit Agreement and the 364-Day Facility exclude the debt of ONEOK Partners. Upon breach
of any covenant by ONEOK, amounts outstanding under the ONEOK Credit Agreement or the 364-Day Facility may become immediately due
and payable. At December 31, 2008, ONEOK’s stand-alone debt-to-capital ratio was 58.2 percent, and ONEOK was in compliance with all
covenants under the ONEOK Credit Agreement and the ONEOK 364-Day Facility.
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Under the ONEOK Partners Credit Agreement, ONEOK Partners is required to comply with certain financial, operational and legal
covenants. Among other things, these requirements include maintaining a ratio of indebtedness to adjusted EBITDA (EBITDA plus minority
interest in income of consolidated subsidiaries, distributions received from investments and EBITDA related to any approved capital projects
less equity earnings from investments and the equity portion of AFUDC) of no more than 5 to 1. If ONEOK Partners consummates one or
more acquisitions in which the aggregate purchase price is $25 million or more, the allowable ratio of indebtedness to adjusted EBITDA will be
increased to 5.5 to 1 for the three calendar quarters following the acquisition. Upon any breach of any covenant by ONEOK Partners in its
ONEOK Partners Credit Agreement, amounts outstanding under the ONEOK Partners Credit Agreement may become immediately due and
payable. At December 31, 2008, ONEOK Partners’ ratio of indebtedness to adjusted EBITDA was 4.1 to 1, and ONEOK Partners was in
compliance with all covenants under the ONEOK Partners Credit Agreement.
The average interest rate on ONEOK and ONEOK Partners short-term debt outstanding at December 31, 2008, was 4.51 percent and 4.22
percent, respectively, compared with a weighted average rate of 3.88 percent and 3.94 percent, respectively, for the year ended December 31,
2008. Based on the forward LIBOR curve, we expect the interest rate on ONEOK and ONEOK Partners’ short-term borrowings to decrease in
2009, compared with 2008.
Long-term Financing - In addition to the principal sources of short-term liquidity discussed above, options available to ONEOK to meet its
longer-term cash requirements include the issuance of equity, issuance of long-term notes, issuance of convertible debt securities, asset
securitization and sale/leaseback of facilities. Options available to ONEOK Partners to meet its longer-term cash requirements include the
issuance of common units, issuance of long-term notes, issuance of convertible debt securities, and asset securitization and sale/leaseback of
facilities.
ONEOK and ONEOK Partners are subject, however, to changes in the equity and debt markets, and there is no assurance they will be able or
willing to access the public or private markets in the future. ONEOK and ONEOK Partners may choose to meet their cash requirements by
utilizing some combination of cash flows from operations, altering the timing of controllable expenditures, restricting future acquisitions and
capital projects, borrowing under existing credit facilities or pursuing other debt or equity financing alternatives. Some of these alternatives
could involve higher costs or negatively affect their respective credit ratings. Based on ONEOK’s and ONEOK Partners’ investment-grade
credit ratings, general financial condition and market expectations regarding their future earnings and projected cash flows, ONEOK and
ONEOK Partners believe that they will be able to meet their respective cash requirements and maintain their investment-grade credit ratings.
ONEOK Partners Debt Issuance - In September 2007, ONEOK Partners completed an underwritten public offering of $600 million aggregate
principal amount of 6.85 percent Senior Notes due 2037 (the 2037 Notes). The 2037 Notes were issued under ONEOK Partners’ existing shelf
registration statement filed with the SEC.
ONEOK Partners may redeem the 2037 Notes, in whole or in part, at any time prior to their maturity at a redemption price equal to the principal
amount of the 2037 Notes, plus accrued and unpaid interest and a make-whole premium. The redemption price will never be less than 100
percent of the principal amount of the 2037 Notes plus accrued and unpaid interest. The 2037 Notes are senior unsecured obligations, ranking
equally in right of payment with all of ONEOK Partners’ existing and future unsecured senior indebtedness, and effectively junior to all of the
existing debt and other liabilities of its non-guarantor subsidiaries. The 2037 Notes are non-recourse to ONEOK.
Debt Covenants - The terms of ONEOK’s long-term notes are governed by indentures containing covenants that include, among other
provisions, limitations on ONEOK’s ability to place liens on its property or assets and its ability to sell and lease back its property.
We filed a new form of indenture in 2008. The new indenture includes covenants that are similar to those contained in our prior
indentures. The new indenture does not limit the aggregate principal amount of debt securities that may be issued and provides that debt
securities may be issued from time to time in one or more additional series.
The indenture governing ONEOK Partners’ 2037 Notes does not limit the aggregate principal amount of debt securities that may be issued and
provides that debt securities may be issued from time to time in one or more additional series. The indenture contains covenants including,
among other provisions, limitations on ONEOK Partners’ ability to place liens on its property or assets and its ability to sell and lease back its
property.
ONEOK Partners’ $250 million and $225 million senior notes, due 2010 and 2011, respectively, contain provisions that require ONEOK Partners
to offer to repurchase the senior notes at par value if its Moody’s or S&P credit rating falls below investment grade (Baa3 for Moody’s or
BBB- for S&P) and the investment-grade rating is not reinstated within a period of 40 days. Further, the indentures governing ONEOK
Partners’ senior notes due 2010 and 2011 include an event of default
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upon acceleration of other indebtedness of $25 million or more and the indentures governing the senior notes due 2012, 2016, 2036 and 2037
include an event of default upon the acceleration of other indebtedness of $100 million or more that would be triggered by such an offer to
repurchase. Such an event of default would entitle the trustee or the holders of 25 percent in aggregate principal amount of the outstanding
senior notes due 2010, 2011, 2012, 2016, 2036 and 2037 to declare those notes immediately due and payable in full.
ONEOK Partners Equity Issuance - In March 2008, ONEOK purchased from ONEOK Partners, in a private placement, an additional 5.4 million
of ONEOK Partners’ common units for a total purchase price of approximately $303.2 million. In addition, ONEOK Partners completed a public
offering of 2.5 million common units at $58.10 per common unit and received net proceeds of $140.4 million after deducting underwriting
discounts but before offering expenses. In conjunction with ONEOK Partners’ private placement and the public offering of common units,
ONEOK Partners GP contributed $9.4 million to ONEOK Partners in order to maintain its 2 percent general partner interest. ONEOK and
ONEOK Partners GP funded these amounts with available cash and short-term borrowings.
order to maintain its 2 percent general partner interest. Following these transactions, our interest in ONEOK Partners is 47.7 percent.
ONEOK Partners used a portion of the proceeds from the sale of common units and the general partner contributions to repay borrowings
under its existing ONEOK Partners Credit Agreement.
Capital Expenditures - ONEOK’s and ONEOK Partners’ capital expenditures are typically financed through operating cash flows, short- and
long-term debt and the issuance of equity. Total capital expenditures for 2008 were $1,473.1 million, compared with $883.7 million in 2007,
exclusive of acquisitions. Of these amounts, ONEOK Partners’ capital expenditures for 2008 were $1,253.9 million, compared with $709.9 million
in 2007, exclusive of acquisitions. The increase in capital expenditures for 2008, compared with 2007, is driven primarily by ONEOK Partners’
internal capital projects discussed beginning on page 37, and ONEOK’s purchase of ONEOK Plaza. ONEOK and ONEOK Partners expect to
continue to finance future capital expenditures with a combination of operating cash flows, short- and long-term debt, and the issuance of
common units by ONEOK Partners.
The following table summarizes our 2009 projected capital expenditures, excluding AFUDC.
2009 Projected Capital Expenditures

ONEOK Partners $ 425
Distribution 137
Energy Services -
Other 19
Total projected capital expenditures $ 581
Projected 2009 capital expenditures are significantly less than 2008 capital expenditures, primarily due to the completion of the Overland Pass
Pipeline and related projects and the Guardian Pipeline expansion and extension. Additional information about our capital expenditures is
included under “Capital Projects” on page 37. ONEOK Partners anticipates spending $300 million to $500 million per year on growth capital
expenditures for the years 2010 through 2015.
Investment in Northern Border Pipeline - Northern Border Pipeline anticipates an equity contribution of approximately $85 million that will be
required of its partners in 2009, of which ONEOK Partners’ share will be approximately $43 million for its 50 percent equity interest.
Credit Ratings - Our credit ratings as of December 31, 2008, are shown in the table below.
ONEOK ONEOK Partners

Rating Agency Rating Outlook Rating Outlook
Moody's Baa2 Stable Baa2 Stable
S&P BBB Stable BBB Stable
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ONEOK’s commercial paper is rated P2 by Moody’s and A2 by S&P. ONEOK’s and ONEOK Partners’ credit ratings, which are currently
investment grade, may be affected by a material change in financial ratios or a material event affecting the business. The most common criteria
for assessment of credit ratings are the debt-to-capital ratio, business risk profile, pretax and after-tax interest coverage, and liquidity. ONEOK
and ONEOK Partners do not anticipate their respective credit ratings to be downgraded. However, if our credit ratings were downgraded, the
interest rates on our commercial paper borrowings, the ONEOK Credit Agreement and the 364-Day Facility would increase, resulting in an
increase in our cost to borrow funds, and we could potentially lose access to the commercial paper market. Likewise, ONEOK Partners would
see increased borrowing costs under the ONEOK Partners Credit Agreement. In the event that ONEOK is unable to borrow funds under its
commercial paper program and there has not been a material adverse change in its business, ONEOK would continue to have access to the
ONEOK Credit Agreement, which expires in July 2011, and the 364-Day Facility, which expires in August 2009. An adverse rating change
alone is not a default under the ONEOK Credit Agreement, the 364-Day Facility or the ONEOK Partners Credit Agreement but could trigger
repurchase obligations with respect to certain long-term debt. See additional discussion about our credit ratings under “Debt Covenants.”
If ONEOK Partners’ repurchase obligations are triggered, it may not have sufficient cash on hand to repurchase and repay any accelerated
senior notes, which may cause it to borrow money under its credit facilities or seek alternative financing sources to finance the repurchases
and repayment. ONEOK Partners could also face difficulties accessing capital or its borrowing costs could increase, impacting its ability to
obtain financing for acquisitions or capital expenditures, to refinance indebtedness and to fulfill its debt obligations.
Our Energy Services segment relies upon the investment-grade rating of ONEOK’s senior unsecured long-term debt to reduce its collateral
requirements. If ONEOK’s credit ratings were to decline below investment grade, our ability to participate in energy marketing and trading
activities could be significantly limited. Without an investment-grade rating, we may be required to fund margin requirements with our
counterparties with cash, letters of credit or other negotiable instruments. At December 31, 2008, we could have been required to fund
approximately $36.2 million in margin requirements related to financial contracts upon such a downgrade. A decline in ONEOK’s credit rating
below investment grade may also significantly impact other business segments.
Other than ONEOK Partners’ note repurchase obligations and the margin requirements for our Energy Services segment described above, we
have determined that we do not have significant exposure to rating triggers under ONEOK’s trust indentures, building leases, equipment
leases and other various contracts. Rating triggers are defined as provisions that would create an automatic default or acceleration of
indebtedness based on a change in our credit rating.
In the normal course of business, ONEOK’s and ONEOK Partners’ counterparties provide secured and unsecured credit. In the event of a
downgrade in ONEOK’s or ONEOK Partners’ credit rating or a significant change in ONEOK’s or ONEOK Partners’ counterparties’ evaluation
of our creditworthiness, ONEOK or ONEOK Partners could be asked to provide additional collateral in the form of cash, letters of credit or
other negotiable instruments.
ONEOK Partners’ Class B Units - - The units we received from ONEOK Partners were newly created Class B limited partner
units. Distributions on the Class B limited partner units were prorated from the date of issuance. As of April 7, 2007, the Class B limited
partner units are no longer subordinated to distributions on ONEOK Partners’ common units and generally have the same voting rights as the
common units.
At a special meeting of the ONEOK Partners common unitholders held March 29, 2007, the unitholders approved a proposal to permit the
conversion of all or a portion of the Class B limited partner units issued in the acquisition and consolidation of certain companies comprising
our former gathering and processing, natural gas liquids, and pipelines and storage segments in a series of transactions (collectively the
ONEOK Transactions) into common units at the option of the Class B unitholder. The March 29, 2007, special meeting was adjourned to May
10, 2007, to allow unitholders additional time to vote on a proposal to approve amendments to the ONEOK Partners’ Partnership Agreement,
which had the amendments been approved, would have granted voting rights for units held by us and our affiliates if a vote is held to remove
us as the general partner and would have required fair market value compensation for our general partner interest if we are removed as general
partner. While a majority of ONEOK Partners common unitholders voted in favor of the proposed amendments to the ONEOK Partners
Partnership Agreement at the reconvened meeting of the common unitholders held May 10, 2007, the proposed amendments were not
approved by the required two-thirds affirmative vote of the outstanding units, excluding the common units and Class B units held by us and
our affiliates. As a result, effective April 7, 2007, the Class B limited partner units are entitled to receive increased quarterly distributions and
distributions upon liquidation equal to 110 percent of the distributions paid with respect to the common units.
On June 21, 2007, we, as the sole holder of ONEOK Partners’ Class B limited partner units, waived our right to receive the increased quarterly
distributions on the Class B units for the period April 7, 2007, through December 31, 2007, and
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continuing thereafter until we give ONEOK Partners no less than 90 days advance notice that we have withdrawn our waiver. Any such
withdrawal of the waiver will be effective with respect to any distribution on the Class B units declared or paid on or after 90 days following
delivery of the notice.
In addition, since the proposed amendments to the ONEOK Partners’ Partnership Agreement were not approved by the common unitholders, if
the common unitholders vote at any time to remove us or our affiliates as the general partner, quarterly distributions payable on Class B limited
partner units would increase to 123.5 percent of the distributions payable with respect to the common units, and distributions payable upon
liquidation of the Class B limited partner units would increase to 123.5 percent of the distributions payable with respect to the common units.
Stock Repurchase Plan - For more information regarding the Stock Repurchase Plan, refer to discussion in Note G of the Notes to
Consolidated Financial Statements in this Annual Report on Form 10-K.
Commodity Prices - We are subject to commodity price volatility. Significant fluctuations in commodity price in either physical or financial
energy contracts may impact our overall liquidity due to the impact the commodity price changes have on our cash flows from operating
activities, including the impact on working capital for NGLs and natural gas held in storage, margin requirements and certain energy-related
receivables. We believe that ONEOK’s and ONEOK Partners’ available credit and cash and cash equivalents are adequate to meet liquidity
requirements associated with commodity price volatility. See discussion beginning on page 63 under “Commodity Price Risk” in Item 7A,
Quantitative and Qualitative Disclosures about Market Risk for information on our hedging activities.
Pension and Postretirement Benefit Plans - Information about our pension and postretirement benefits plans, including anticipated
contributions, is included under Note J of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K.
At December 31, 2007, the funded status of our pension plans exceeded 94 percent as required by federal regulations. General market factors
in 2008 negatively impacted the fair value of our plan assets, and as a result, we made a voluntary contribution to our pension plans of $112
million on December 31, 2008. We do not expect that our funding requirements in 2009 will have a material impact on our liquidity.
ENVIRONMENTAL LIABILITIES
Information about our environmental liabilities is included in Note K of the Notes to Consolidated Financial Statements in this Annual Report
on Form 10-K.
CASH FLOW ANALYSIS
We use the indirect method to prepare our Consolidated 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, allowance for equity funds used during
construction, gain on sale of assets, minority interests in income of consolidated affiliates, undistributed earnings from equity investments in
excess of distributions received, deferred income taxes, stock-based compensation expense, allowance for doubtful accounts, inventory
adjustments and investment securities gains. The following table sets forth the changes in cash flows by operating, investing and financing
activities for the periods indicated.
Variances Variances
2008 2007 2006 Increase (Decrease) Increase (Decrease)
Total cash provided by (used in):
Operating activities $ 475.7 $ 1,029.7 $ 873.3 $ (554.0) (54% ) $ 156.4 18%
Investing activities (1,454.3) (1,151.8) (237.2) (302.5) (26% ) (914.6) *
Financing activities 1,469.6 72.9 (618.8) 1,396.7 * 691.7 *
Change in cash and cash equivalents 491.0 (49.2) 17.3 540.2 * (66.5) *
Cash and cash equivalents at beginning of
period 19.1 68.3 7.9 (49.2) (72% ) 60.4 *
Effect of Accounting Change
on Cash and Cash Equivalents - - 43.1 - 0% (43.1) (100%)
Cash and cash equivalents at end of period $ 510.1 $ 19.1 $ 68.3 $ 491.0 * $ (49.2) (72%)
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Operating Cash Flows - Operating cash flows decreased by $554.0 million for 2008, compared with 2007, primarily due to changes in working
capital. These changes decreased operating cash flows by $515.3 million for 2008, compared with an increase of $203.6 million for 2007,
primarily due to decreases in accounts payable and increased funding for our pension plans, partially offset by decreases in accounts and
notes receivable. The decrease in operating cash flows due to increases in working capital for 2008 was partially offset by higher net income.
Operating cash flows increased by $156.4 million for 2007, compared with 2006. Working capital increased operating cash flows by $203.6
million for 2007, compared with an increase of $59.7 million for 2006.
Investing Cash Flows - The increased use of cash during 2008 was primarily related to a $589.4 million increase in capital expenditures,
compared with 2007. Capital expenditures increased $507.4 for 2007, compared with 2006. These increases are primarily related to ONEOK
Partners’ capital projects.
In October 2007, ONEOK Partners acquired an interstate natural gas liquids and refined petroleum products pipeline system and related assets
from a subsidiary of Kinder Morgan for approximately $300 million, before working capital adjustments.
In April 2006, our ONEOK Partners segment received $297.0 million for the sale of a 20 percent partnership interest in Northern Border
Pipeline. Our Energy Services segment received $53.0 million for the sale of our discontinued component, Spring Creek, in October 2006.
Acquisitions in 2006 primarily relate to our ONEOK Partners segment acquiring the 66-2/3 percent interest in Guardian Pipeline not previously
owned by ONEOK Partners for approximately $77 million. We also purchased from TransCanada its 17.5 percent general partner interest in
ONEOK Partners for $40 million. Additionally, ONEOK Partners paid $11.6 million to Williams for a 99 percent interest in, and initial capital
expenditures related to, the Overland Pass Pipeline Company natural gas liquids pipeline joint venture.
We had a decrease in short-term investments of $31.1 million for 2007, compared with a total investment of $31.1 million for 2006. During 2007,
we had less cash to invest following our repurchase of 7.5 million shares of our outstanding common stock in June.
Investing cash flows for 2006 also include the impact of the deconsolidation of Northern Border Pipeline and consolidation of Guardian
Pipeline.
Financing Cash Flows - Net short-term borrowings were $2.1 billion for 2008, compared with $196.6 million for 2007. The increased short-term
borrowings during 2008 were used to repay a portion of $402.3 million of maturing long-term debt. Short-term borrowings also increased as the
result ONEOK’s and ONEOK Partners’ decision in late 2008 to borrow under their available credit facilities to fund their respective anticipated
working capital requirements for the remainder of 2008 and into 2009, and ONEOK Partners’ capital projects.
During 2008, ONEOK Partners’ public sale of 2.6 million common units generated approximately $147 million, after deducting underwriting
discounts but before offering expenses.
In 2007, short-term financing was primarily used to fund ONEOK Partners’ capital projects. ONEOK Partners’ $598 million debt issuance, net
of discounts, was used to repay borrowings under the ONEOK Partners Credit agreement and finance the $300 million acquisition of assets,
before working capital adjustments, from a subsidiary of Kinder Morgan in October 2007.
In 2006, we repaid the remaining $900 million outstanding on our $1.0 billion short-term bridge financing agreement. During the second quarter
of 2006, ONEOK Partners borrowed $1.05 billion under its $1.1 billion 364-day credit facility dated April 6, 2006, (Bridge Facility) to finance a
portion of the acquisition of the ONEOK Energy Assets and $77 million under its then existing credit agreement to acquire the 66-2/3 percent
interest in Guardian Pipeline not previously owned by ONEOK Partners. During the third quarter of 2006, ONEOK Partners completed the
underwritten public offering of senior notes totaling $1.4 billion in net proceeds, before offering expenses, which were used to repay all of the
amounts outstanding of the $1.05 billion borrowed under the ONEOK Partners Bridge Facility and to repay $335 million of indebtedness
outstanding under its then existing credit agreement.
On February 16, 2006, we successfully settled our 16.1 million equity units to 19.5 million shares of our common stock. With the settlement of
the equity units, we received $402.4 million in cash, which we used to repay a portion of our commercial paper. We repaid a total of $641.5
million of our commercial paper during 2006. See Note G of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-
K for additional discussion regarding the equity unit conversion.
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In March 2006, our ONEOK Partners segment borrowed $33 million under its then existing credit agreement to redeem all of the outstanding
Viking Gas Transmission Series A, B, C and D senior notes and paid a redemption premium of $3.6 million.
During 2007, we paid $20.1 million for the settlement of the forward purchase contract related to our stock repurchase in February and
approximately $370 million for our stock repurchase in June. We paid $281.4 million to repurchase shares in August 2006.
CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
The following table sets forth our contractual obligations related to debt, operating leases and other long-term obligations as of December 31,
2008. For additional discussion of the debt and operating lease agreements, see Notes I and K, respectively, of the Notes to the Consolidated
Financial Statements in this Annual Report on Form 10-K.
Payments Due by Period

Contractual Obligations Total 2009 2010 2011 2012 2013 Thereafter
ONEOK (Thousands of dollars)
$1.2 billion credit agreement $ 1,100,000 $ 1,100,000 $ - $ - $ - $ - $ -
$400 million credit agreement 300,000 300,000 - - - - -
Long-term debt 1,584,053 106,265 6,284 406,306 6,329 6,205 1,052,664
Interest payments on debt 1,100,500 92,100 91,400 70,900 62,100 61,700 722,300
Operating leases 300,795 88,837 55,888 61,232 32,943 25,376 36,519
Firm transportation contracts 552,509 123,352 103,157 81,833 80,389 57,249 106,529
Financial and physical derivatives 927,635 816,319 97,225 13,623 468 - -
Employee benefit plans 42,602 42,602 - - - - -
Other 850 567 283 - - - -
$ 5,908,944 $ 2,670,042 $ 354,237 $ 633,894 $ 182,229 $ 150,530 $ 1,918,012
ONEOK Partners
$1 billion credit agreement $ 870,000 $ 870,000 $ - $ - $ - $ - $ -
Long-term debt 2,596,711 11,931 261,931 236,931 361,062 7,650 1,717,206
Interest payments on debt 2,686,400 176,700 163,700 140,000 120,200 114,300 1,971,500
Operating leases 86,508 18,362 16,027 15,527 8,755 2,063 25,774
Firm transportation contracts 14,765 11,086 3,679 - - - -
Financial and physical derivatives 48,467 48,467 - - - - -
Purchase commitments,
rights-of-way and other 35,582 30,914 977 976 977 977 761
$ 6,338,433 $ 1,167,460 $ 446,314 $ 393,434 $ 490,994 $ 124,990 $ 3,715,241
Total $ 12,247,377 $ 3,837,502 $ 800,551 $ 1,027,328 $ 673,223 $ 275,520 $ 5,633,253
Long-term Debt - Long-term debt as reported in our Consolidated Balance Sheets includes unamortized debt discount and the mark-to-market
effect of interest-rate swaps.
Interest Payments on Debt - Interest expense is calculated by multiplying long-term debt by the respective coupon rates, adjusted for active
swaps.
Operating Leases - Our operating leases include a natural gas processing plant, storage contracts, office space, pipeline equipment, rights of
way and vehicles. Operating lease obligations for ONEOK exclude intercompany payments related to the lease of a gas processing plant.
Firm Transportation Contracts - Our ONEOK Partners, Distribution and Energy Services segments are party to fixed-price transportation
contracts. However, the costs associated with our Distribution segment’s contracts are recovered through rates as allowed by the applicable
regulatory agency and are excluded from the table above. Firm transportation agreements with our ONEOK Partners segment’s natural gas
gathering and processing joint ventures require minimum monthly payments.
Financial and Physical Derivatives - These are obligations arising from our ONEOK Partners and Energy Services segments’ physical and
financial derivatives for fixed-price purchase commitments and are based on market information at December 31, 2008. Not included in these
amounts are offsetting cash inflows from our Energy Services segment’s product sales and net positive settlements. As market information
changes daily and is potentially volatile, these values may change significantly. Additionally, product sales may require additional purchase
obligations to fulfill sales obligations that are not reflected in these amounts.
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Employee Benefit Plans - Employee benefit plans include our minimum required contribution to our pension and postretirement benefit plans
for 2009. See Note J of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for discussion of our employee
benefit plans.
Purchase Commitments - - Purchase commitments include commitments related to ONEOK Partners’ growth capital expenditures and other
rights of way commitments. Purchase commitments exclude commodity purchase contracts, which are included in the “Financial and physical
derivatives” amounts.
FORWARD-LOOKING STATEMENTS
Some of the statements contained and incorporated in this Annual Report on Form 10-K are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. The forward-
looking statements relate to our anticipated financial performance, management’s plans and objectives for our future operations, our business
prospects, the outcome of regulatory and legal proceedings, market conditions and other matters. We make these forward-looking statements
in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. The following discussion is
intended to identify important factors that could cause future outcomes to differ materially from those set forth in the forward-looking
statements.
Forward-looking statements include the items identified in the preceding paragraph, the information concerning possible or assumed future
results of our operations and other statements contained or incorporated in this Annual Report on Form 10-K identified by words such as
“anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “should,” “goal,” “forecast,” “could,” “may,” “continue,” “might,”
“potential,” “scheduled,” and other words and terms of similar meaning.
You should not place undue reliance on forward-looking statements. Known and unknown risks, uncertainties and other factors may cause
our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or
implied by forward-looking statements. Those factors may affect our operations, markets, products, services and prices. In addition to any
assumptions and other factors referred to specifically in connection with the forward-looking statements, factors that could cause our actual
results to differ materially from those contemplated in any forward-looking statement include, among others, the following:
•the effects of weather and other natural phenomena on our operations, including energy sales and demand for our services and
energy prices;
•competition from other United States and Canadian energy suppliers and transporters as well as alternative forms of energy,
including, but not limited to, biofuels such as ethanol and biodiesel;
•the status of deregulation of retail natural gas distribution;
•the capital intensive nature of our businesses;
•the profitability of assets or businesses acquired or constructed by us;
•our ability to make cost-saving changes in operations;
•risks of marketing, trading and hedging activities, including the risks of changes in energy prices or the financial condition of our
counterparties;
•the uncertainty of estimates, including accruals and costs of environmental remediation;
•the timing and extent of changes in energy commodity prices;
•the effects of changes in governmental policies and regulatory actions, including changes with respect to income and other taxes,
environmental compliance, climate change initiatives, and authorized rates or recovery of gas and gas transportation costs;
•the impact on drilling and production by factors beyond our control, including the demand for natural gas and refinery-grade crude
oil; producers’ desire and ability to obtain necessary permits; reserve performance; and capacity constraints on the pipelines that
transport crude oil, natural gas and NGLs from producing areas and our facilities;
•changes in demand for the use of natural gas because of market conditions caused by concerns about global warming;
•the impact of unforeseen changes in interest rates, equity markets, inflation rates, economic recession and other external factors over
which we have no control, including the effect on pension expense and funding resulting from changes in stock and bond market
returns;
•our indebtedness could make us vulnerable to general adverse economic and industry conditions, limit our ability to borrow
additional funds, and/or place us at competitive disadvantages compared to our competitors that have less debt, or have other
adverse consequences;
•actions by rating agencies concerning the credit ratings of ONEOK and ONEOK Partners;
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•the results of administrative proceedings and litigation, regulatory actions and receipt of expected clearances involving the OCC,
KCC, Texas regulatory authorities or any other local, state or federal regulatory body, including the FERC;
•our ability to access capital at competitive rates or on terms acceptable to us;
•risks associated with adequate supply to our gathering, processing, fractionation and pipeline facilities, including production
declines that outpace new drilling;
•the risk that material weaknesses or significant deficiencies in our internal controls over financial reporting could emerge or that minor
problems could become significant;
•the impact and outcome of pending and future litigation;
•the ability to market pipeline capacity on favorable terms, including the effects of:
- future demand for and prices of natural gas and NGLs;
- competitive conditions in the overall energy market;
- availability of supplies of Canadian and United States natural gas; and
- availability of additional storage capacity;
•performance of contractual obligations by our customers, service providers, contractors and shippers;
•the timely receipt of approval by applicable governmental entities for construction and operation of our pipeline and other projects
and required regulatory clearances;
•our ability to acquire all necessary permits, consents or other approvals in a timely manner, to promptly obtain all necessary materials
and supplies required for construction, and to construct gathering, processing, storage, fractionation and transportation facilities
without labor or contractor problems;
•the mechanical integrity of facilities operated;
•demand for our services in the proximity of our facilities;
•our ability to control operating costs;
•adverse labor relations;
•acts of nature, sabotage, terrorism or other similar acts that cause damage to our facilities or our suppliers’ or shippers’ facilities;
•economic climate and growth in the geographic areas in which we do business;
•the risk of a prolonged slowdown in growth or decline in the United States economy or the risk of delay in growth recovery in the
United States economy, including increasing liquidity risks in United States credit markets;
•the impact of recently issued and future accounting pronouncements and other changes in accounting policies;
•the possibility of future terrorist attacks or the possibility or occurrence of an outbreak of, or changes in, hostilities or changes in the
political conditions in the Middle East and elsewhere;
•the risk of increased costs for insurance premiums, security or other items as a consequence of terrorist attacks;
•risks associated with pending or possible acquisitions and dispositions, including our ability to finance or integrate any such
acquisitions and any regulatory delay or conditions imposed by regulatory bodies in connection with any such acquisitions and
dispositions;
•the possible loss of gas distribution franchises or other adverse effects caused by the actions of municipalities;
•the impact of unsold pipeline capacity being greater or less than expected;
•the ability to recover operating costs and amounts equivalent to income taxes, costs of property, plant and equipment and regulatory
assets in our state and FERC-regulated rates;
•the composition and quality of the natural gas and NGLs we gather and process in our plants and transport on our pipelines;
•the efficiency of our plants in processing natural gas and extracting and fractionating NGLs;
•the impact of potential impairment charges;
•the risk inherent in the use of information systems in our respective businesses, implementation of new software and hardware, and
the impact on the timeliness of information for financial reporting;
•our ability to control construction costs and completion schedules of our pipelines and other projects; and
•the risk factors listed in the reports we have filed and may file with the SEC, which are incorporated by reference.
These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of
our forward-looking statements. Other factors could also have material adverse effects on our future results. These and other risks are
described in greater detail in Item 1A, Risk Factors, in this Annual Report on Form 10-K. All forward-looking statements attributable to us or
persons acting on our behalf are expressly qualified in their entirety by these factors. Other than as required under securities laws, we
undertake no obligation to update publicly any forward-looking statement whether as a result of new information, subsequent events or
change in circumstances, expectations or otherwise.
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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Risk Policy and Oversight - We control the scope of risk management, marketing and trading operations through a comprehensive set of
policies and procedures involving senior levels of management. The Audit Committee of our Board of Directors has oversight responsibilities
for our risk management limits and policies. Our risk oversight committee, comprised of corporate and business segment officers, oversees all
activities related to commodity price and credit risk management, and marketing and trading activities. The committee also monitors risk
metrics including value-at-risk (VAR) and mark-to-market losses. We have a risk control group that is assigned responsibility for establishing
and enforcing the policies and procedures and monitoring certain risk metrics. Key risk control activities include risk measurement and
monitoring, validation of transactions, portfolio valuation, VAR and other risk metrics.
Our exposure to market risk discussed below includes forward-looking statements and represents an estimate of possible changes in future
earnings that would occur assuming hypothetical future movements in interest rates or commodity prices. 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
We are exposed to commodity price risk and the impact of market price fluctuations of natural gas, NGLs and crude oil prices. Commodity
price risk refers to the risk of loss in cash flows and future earnings arising from adverse changes in commodity energy prices. To minimize the
risk from market price fluctuations of natural gas, NGLs and crude oil, we use commodity derivative instruments such as futures, physical
forward contracts, swaps and options to manage commodity price risk associated with existing or anticipated purchase and sale agreements,
existing physical natural gas in storage, and basis risk.
ONEOK Partners
ONEOK Partners is exposed to commodity price risk, primarily with respect to NGLs, as a result of receiving commodities in exchange for its
gathering and processing services. To a lesser extent, ONEOK Partners is exposed to the relative price differential between NGLs and natural
gas, or the gross processing spread, with respect to its keep-whole processing contracts. ONEOK Partners is also exposed to the risk of price
fluctuations and the cost of intervening transportation at various market locations. As part of ONEOK Partners’ hedging strategy, ONEOK
Partners uses commodity fixed-price physical forwards and derivative contracts, including NYMEX-based futures and over-the-counter
swaps, to minimize earnings volatility in its natural gas gathering and processing business related to natural gas, NGL and condensate price
fluctuations.
ONEOK Partners reduces its gross processing spread exposure through a combination of physical and financial hedges. ONEOK Partners
utilizes a portion of its percent-of-proceeds equity natural gas as an offset, or natural hedge, to an equivalent portion of its keep-whole shrink
requirements. This has the effect of converting ONEOK Partners’ gross processing spread risk to NGL commodity price risk, and ONEOK
Partners then uses financial instruments to hedge the sale of NGLs.
The following table sets forth ONEOK Partners’ hedging information for the year ending December 31, 2009.
Year Ending December 31, 2009

Volumes Percentage
Hedged Average Price Hedged
NGLs (Bbl/d) (a) 5,010 $ 1.18/ gallon 57%
Condensate (Bbl/d) (a) 666 $ 3.23/ gallon 32%
Total liquid sales (Bbl/d) 5,676 $ 1.42/ gallon 52%
(a) - Hedged with fixed-price swaps.
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ONEOK Partners’ commodity price risk is estimated as a hypothetical change in the price of NGLs, crude oil and natural gas at December 31,
2008, excluding the effects of hedging and assuming normal operating conditions. ONEOK Partners’ condensate sales are based on the price
of crude oil. ONEOK Partners estimates the following:
•a $0.01 per gallon decrease in the composite price of NGLs would decrease annual net margin by approximately $1.2 million;
•a $1.00 per barrel decrease in the price of crude oil would decrease annual net margin by approximately $1.0 million; and
•a $0.10 per MMBtu decrease in the price of natural gas would decrease annual net margin by approximately $0.6 million.
The above estimates of commodity price risk do not include any effects on demand for its services that might be caused by, or arise in
conjunction with, price changes. For example, a change in the gross processing spread may cause a change in the amount of ethane extracted
from the natural gas stream, impacting gathering and processing margins, NGL exchange revenues, natural gas deliveries, and NGL volumes
shipped and fractionated.
ONEOK Partners is also exposed to commodity price risk primarily as a result of NGLs in storage, the relative values of the various NGL
products to each other, the relative value of NGLs to natural gas and the relative value of NGL purchases at one location and sales at another
location, known as basis risk. ONEOK Partners utilizes fixed-price physical forward contracts to reduce earnings volatility related to NGL price
fluctuations. ONEOK Partners has not entered into any financial instruments with respect to its NGL marketing activities.
In addition, ONEOK Partners is exposed to commodity price risk as its natural gas interstate and intrastate pipelines collect natural gas from its
customers for operations or as part of its fee for services provided. When the amount of natural gas consumed in operations by these
pipelines differs from the amount provided by its customers, the pipelines must buy or sell natural gas, or store or use natural gas from
inventory, which exposes ONEOK Partners to commodity price risk. At December 31, 2008, there were no hedges in place with respect to
natural gas price risk from ONEOK Partners’ natural gas pipeline business.
Distribution
Our Distribution segment uses derivative instruments to hedge the cost of anticipated natural gas purchases during the winter heating months
to protect their customers from upward volatility in the market price of natural gas. Gains or losses associated with these derivative
instruments are included in, and recoverable through, the monthly purchased gas cost mechanism.
Energy Services
Our Energy Services segment is exposed to commodity price risk, basis risk and price volatility arising from natural gas in storage, requirement
contracts, asset management contracts and index-based purchases and sales of natural gas at various market locations. We minimize the
volatility of our exposure to commodity price risk through the use of derivative instruments, which, under certain circumstances, are
designated as cash flow or fair value hedges. We are also exposed to commodity price risk from fixed-price purchases and sales of natural gas,
which we hedge with derivative instruments. Both the fixed-price purchases and sales and related derivatives are recorded at fair value.
Fair Value Component of the Energy Marketing and Risk Management Assets and Liabilities - The following table sets forth the fair value
component of the energy marketing and risk management assets and liabilities, excluding $21.0 million of net liabilities from derivative
instruments declared as either fair value or cash flow hedges.
Fair Value Component of Energy Marketing and Risk Management Assets and Liabilities
Net fair value of derivatives outstanding at December 31, 2007 $ 25,171
Derivatives reclassified or otherwise settled during the period (55,874)
Fair value of new derivatives entered into during the period 236,772
Other changes in fair value 52,731
Net fair value of derivatives outstanding at December 31, 2008 (a) $ 258,800
(a) - The maturities of derivatives are based on injection and withdrawal periods from
April through March, which is consistent with our business strategy. The maturities
are as follows: $225.0 million matures through March 2009, $33.9 million matures
through March 2012 and $(0.1) million matures through March 2014.
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The change in the net fair value of derivatives outstanding includes the effect of settled energy contracts and current period changes resulting
primarily from newly originated transactions and the impact of market movements on the fair value of energy marketing and risk management
assets and liabilities. Fair value of new derivatives entered into during the period includes $298.8 million of cash flow hedges reclassified into
earnings from accumulated other comprehensive income (loss) related to the write-down of our natural gas in storage to its lower of weighted-
average cost or market.
For further discussion of fair value measurements and trading activities and assumptions used in our trading activities, see the “Critical
Accounting Policies and Estimates” section of Item 7, Management’s Discussion and Analysis of Financial Condition and Results of
Operation. Also, see Notes C and D of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K.
Value-at-Risk (VAR) Disclosure of Commodity Price Risk - We measure commodity price risk in our Energy Services segment using a VAR
methodology, which estimates the expected maximum loss of our portfolio over a specified time horizon within a given confidence
interval. Our VAR calculations are based on the Monte Carlo approach. The quantification of commodity price risk using VAR provides a
consistent measure of risk across diverse energy markets and products with different risk factors in order to set overall risk tolerance and to
determine risk thresholds. The use of this methodology requires a number of key assumptions, including the selection of a confidence level
and the holding period to liquidation. Inputs to the calculation include prices, volatilities, positions, instrument valuations and the variance-
covariance matrix. Historical data is used to estimate our VAR with more weight given to recent data, which is considered a more relevant
predictor of immediate future commodity market movements. We rely on VAR to determine the potential reduction in the portfolio values
arising from changes in market conditions over a defined period. While management believes that the referenced assumptions and
approximations are reasonable, no uniform industry methodology exists for estimating VAR. Different assumptions and approximations could
produce materially different VAR estimates.
Our VAR exposure represents an estimate of potential losses that would be recognized due to adverse commodity price movements in our
Energy Services segment’s portfolio of derivative financial instruments, physical commodity contracts, leased transport, storage capacity
contracts and natural gas in storage. A one-day time horizon and a 95 percent confidence level are used in our VAR data. Actual future gains
and losses will differ from those estimated by the VAR calculation based on actual fluctuations in commodity prices, operating exposures and
timing thereof, and the changes in our derivative financial instruments, physical contracts and natural gas in storage. VAR information should
be evaluated in light of these assumptions and the methodology’s other limitations.
The potential impact on our future earnings, as measured by VAR, was $7.9 million and $6.0 million at December 31, 2008 and 2007,
respectively. The following table details the average, high and low VAR calculations for the periods indicated.

Value-at-Risk 2008 2007
Average $ 12.3 $ 8.9
High $ 24.9 $ 23.0
Low $ 4.0 $ 3.4
Our VAR calculation includes derivatives, executory storage and transportation agreements and their related hedges. The variations in the
VAR data are reflective of market volatility and changes in our portfolio during the year. The increase in average VAR for 2008, compared with
2007, was primarily due to a significant increase in natural gas prices during the second quarter of 2008.
Our VAR calculation uses historical prices, placing more emphasis on the most recent price movements. We revised our assumptions in the
third quarter of 2008 to decrease the weight given to the most recent price changes and spread the relative weighting over more historical
data. This methodology reduces the effects of the market anomalies and better reflects an efficient market. We believe this methodology is
more reflective of portfolio risk and have applied the change on a prospective basis.
During 2008, we also began calculating the VAR on our mark-to-market derivative positions, which reflects the risk associated with derivatives
whose change in fair value will impact current period earnings. These transactions are subject to mark-to-market accounting treatment
because they are not part of a hedging relationship under Statement 133. VAR associated with these derivative positions was not material
during 2008. To the extent open commodity positions exist, fluctuating commodity prices can impact our financial results and financial
position either favorably or unfavorably. As a result, we cannot predict with precision the impact risk management decisions may have on the
business, operating results or financial position.
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INTEREST RATE RISK
General - We are subject to the risk of interest-rate fluctuation in the normal course of business. We manage interest-rate risk through the use
of fixed-rate debt, floating-rate debt and, at times, interest-rate swaps. Fixed-rate swaps are used to reduce our risk of increased interest costs
during periods of rising interest rates. Floating-rate swaps are used to convert the fixed rates of long-term borrowings into short-term variable
rates. At December 31, 2008, the interest rate on 89.3 percent of our long-term debt, exclusive of the debt of our ONEOK Partners segment, was
fixed after considering the impact of interest-rate swaps. At December 31, 2008, the interest rate on all of ONEOK Partners’ long-term debt was
fixed.
We terminated a $100 million interest-rate swap in the fourth quarter of 2008. The total value we received was $19.2 million, which includes $0.3
million of swap savings previously recorded. The remaining savings of $18.9 million will be recognized in interest expense over the remaining
term of the debt instrument originally hedged.
In the fourth quarter of 2008, our counterparties exercised the option to terminate two additional interest-rate swap agreements totaling $140
million. The swap terminations were effective in December 2008 and January 2009. The total value we received for the terminated swaps was
not material.
At December 31, 2008, a 100 basis point move in the annual interest rate on all of our swapped long-term debt would change our annual
interest expense by $1.7 million before taxes. This 100 basis point change assumes a parallel shift in the yield curve. If interest rates changed
significantly, we would take actions to manage our exposure to the change. Since a specific action and the possible effects are uncertain, no
change has been assumed.
Fair Value Hedges - See Note D of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K for discussion of the
impact of interest-rate swaps and net interest expense savings from terminated swaps.
Total net swap savings for 2008 were $17.4 million, compared with $8.2 million for 2007. Total swap savings for 2009 are expected to be $10.5
million.
CURRENCY EXCHANGE RATE RISK
As a result of our Energy Services segment’s operations in Canada, we are exposed to currency exchange rate risk from our commodity
purchases and sales related to our firm transportation and storage contracts. To reduce our exposure to exchange-rate fluctuations, we use
physical forward transactions, which result in an actual two-way flow of currency on the settlement date since we exchange U.S. dollars for
Canadian dollars with another party. We have not designated these transactions for hedge accounting treatment; therefore, the gains and
losses associated with the change in fair value are recorded in net margin. At December 31, 2008 and 2007, our exposure to risk from currency
translation was not material. We recognized a currency translation loss of $3.1 million during 2008 and currency translation gains of $4.1
million and $2.5 million during 2007 and 2006, respectively.
COUNTERPARTY CREDIT RISK
ONEOK and ONEOK Partners assess the creditworthiness of their counterparties on an on going basis and require security, including
prepayments and other forms of cash collateral, when appropriate.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders

ONEOK, Inc.:
In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of income, shareholders’ equity and
comprehensive income and cash flows present fairly, in all material respects, the financial position of ONEOK, Inc. and its subsidiaries (the
Company) at December 31, 2008 and 2007, and the results of their operations and their cash flows for each of the two years in the period ended
December 31, 2008, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the
Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on criteria
established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO). The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial
reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal
Control over Financial Reporting appearing under Item 9A in the Company’s Form 10-K for the year ended December 31, 2008. Our
responsibility is to express opinions on these financial statements and on the Company’s internal control over financial reporting based on our
integrated 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 audits to obtain reasonable assurance about whether the financial statements
are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our
audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial
statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over
financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of
internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our opinions.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may deteriorate.
/s/ PricewaterhouseCoopers LLP
February 24, 2009

Tulsa, Oklahoma
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders

ONEOK, Inc.:
We have audited the accompanying consolidated statement of income, cash flows, and shareholders’ equity and comprehensive income of
ONEOK, Inc. and subsidiaries as of December 31, 2006. The consolidated financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.
We conducted our audit 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 audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash
flows of ONEOK, Inc. and subsidiaries for the year ended December 31, 2006, in conformity with U.S. generally accepted accounting principles.
As discussed in Note A of Notes to the Consolidated Financial Statements, the Company adopted the provisions of Statement of Financial
Accounting Standards (SFAS) No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans,” Emerging
Issues Task Force Issue 04-5, “Determining Whether a General Partner, or General Partners as a Group Controls a Limited Partnership or Similar
Entity When the Limited Partners Have Certain Rights,” and SFAS No. 123R, “Share-Based Payment.”
/s/ KPMG LLP
Tulsa, Oklahoma
February 28, 2007
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ONEOK, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF INCOME
2008 2007 2006
(Thousands of dollars, except per share amounts)
Revenues $ 16,157,433 $ 13,477,414 $ 11,920,326

Cost of sales and fuel 14,221,906 11,667,306 10,198,342
Net Margin 1,935,527 1,810,108 1,721,984
Operating Expenses
Operations and maintenance 694,597 675,575 662,681
Depreciation and amortization 243,927 227,964 235,543
General taxes 82,315 85,935 78,086
Total Operating Expenses 1,020,839 989,474 976,310
Gain (Loss) on Sale of Assets 2,316 1,909 116,528
Operating Income 917,004 822,543 862,202
Equity earnings from investments (Note O) 101,432 89,908 95,883
Allowance for equity funds used during construction 50,906 12,538 2,205
Other income 16,838 21,932 26,030
Other expense (27,475) (7,879) (24,154)
Interest expense (264,167) (256,325) (239,725)
Income before Minority Interests and Income Taxes 794,538 682,717 722,441
Minority interests in income of consolidated subsidiaries (288,558) (193,199) (222,000)
Income taxes (Note L) (194,071) (184,597) (193,764)
Income from Continuing Operations 311,909 304,921 306,677
Gain (Loss) from operations of discontinued components, net of tax - - (365)
Net Income $ 311,909 $ 304,921 $ 306,312
Earnings Per Share of Common Stock (Note P)

Net Earnings Per Share, Basic $ 2.99 $ 2.84 $ 2.74
Net Earnings Per Share, Diluted $ 2.95 $ 2.79 $ 2.68
Average Shares of Common Stock (Thousands)

Basic 104,369 107,346 112,006
Diluted 105,760 109,298 114,477
Dividends Declared Per Share of Common Stock $ 1.56 $ 1.40 $ 1.22

See accompanying Notes to Consolidated Financial Statements.
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CONSOLIDATED BALANCE SHEETS
December 31, December 31,
2008 2007
Assets (Thousands of dollars)
Current Assets
Cash and cash equivalents $ 510,058 $ 19,105
Accounts receivable, net 1,265,300 1,723,212
Gas and natural gas liquids in storage 858,966 841,362
Commodity exchanges and imbalances 56,248 82,938
Energy marketing and risk management assets (Notes C and D) 362,808 143,941
Other current assets 324,222 140,917
Total Current Assets 3,377,602 2,951,475
Property, Plant and Equipment

Property, plant and equipment 9,476,619 7,893,492
Accumulated depreciation and amortization 2,212,850 2,048,311
Net Property, Plant and Equipment (Note A) 7,263,769 5,845,181
Investments and Other Assets

Goodwill and intangible assets (Note E) 1,038,226 1,043,773
Energy marketing and risk management assets (Notes C and D) 45,900 3,978
Investments in unconsolidated affiliates (Note O) 755,492 756,260
Other assets 645,073 461,367
Total Investments and Other Assets 2,484,691 2,265,378
Total Assets $ 13,126,062 $ 11,062,034
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CONSOLIDATED BALANCE SHEETS
2008 2007
Liabilities and Shareholders’ Equity (Thousands of dollars)
Current Liabilities
Current maturities of long-term debt (Note I) $ 118,195 $ 420,479
Notes payable 2,270,000 202,600
Accounts payable 1,122,761 1,436,005
Commodity exchanges and imbalances 188,030 252,095
Energy marketing and risk management liabilities (Notes C and D) 175,006 133,903
Other current liabilities 319,772 436,585
Total Current Liabilities 4,193,764 2,881,667
Long-term Debt, excluding current maturities (Note I) 4,112,581 4,215,046
Deferred Credits and Other Liabilities

Deferred income taxes 890,815 680,543
Energy marketing and risk management liabilities (Notes C and D) 46,311 26,861
Other deferred credits 715,052 486,645
Total Deferred Credits and Other Liabilities 1,652,178 1,194,049
Commitments and Contingencies (Note K)
Minority Interests in Consolidated Subsidiaries 1,079,369 801,964
Shareholders’ Equity
Common stock, $0.01 par value:
authorized 300,000,000 shares; issued 121,647,007 shares
and outstanding 104,845,231 shares at December 31, 2008;
issued 121,115,217 shares and outstanding 103,987,476
shares at December 31, 2007 1,216 1,211
Paid in capital 1,301,153 1,273,800
Accumulated other comprehensive loss (Note F) (70,616) (7,069)
Retained earnings 1,553,033 1,411,492
Treasury stock, at cost: 16,801,776 shares at December 31,
2008 and 17,127,741 shares at December 31, 2007 (696,616) (710,126)
Total Shareholders’ Equity 2,088,170 1,969,308
Total Liabilities and Shareholders’ Equity $ 13,126,062 $ 11,062,034
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CONSOLIDATED STATEMENTS OF CASH FLOWS
2008 2007 2006
Operating Activities (Thousands of dollars)
Net income $ 311,909 $ 304,921 $ 306,312
Depreciation and amortization 243,927 227,964 235,543
Allowance for equity funds used during construction (50,906) (12,538) (2,205)
Gain on sale of assets (2,316) (1,909) (116,528)
Minority interests in income of consolidated subsidiaries 288,558 193,199 222,000
Equity earnings from investments (101,432) (89,908) (95,883)
Distributions received from unconsolidated affiliates 93,261 103,785 123,427
Deferred income taxes 165,191 65,017 115,384
Stock-based compensation expense 30,791 20,909 16,499
Allowance for doubtful accounts 13,476 14,578 9,056
Inventory adjustment, net 9,658 - -
Investment securities gains (11,142) - -
Changes in assets and liabilities (net of acquisition and disposition effects):
Accounts and notes receivable 433,859 (378,876) 649,415
Gas and natural gas liquids in storage (370,662) 88,937 (13,801)
Accounts payable (340,584) 343,144 (425,715)
Commodity exchanges and imbalances, net (37,375) 40,572 18,001
Unrecovered purchased gas costs (35,790) 9,530 (73,534)
Accrued interest 16,002 9,001 25,329
Energy marketing and risk management assets and liabilities 60,846 41,649 (63,040)
Fair value of firm commitments 505 5,631 190,795
Pension and postretirement benefit plans (83,254) 28,573 (14,496)
Other assets and liabilities (158,845) 15,481 (233,283)
Cash Provided by Operating Activities 475,677 1,029,660 873,276
Investing Activities
Changes in investments in unconsolidated affiliates 3,963 (3,668) (6,608)
Acquisitions 2,450 (299,560) (148,892)
Capital expenditures (less allowance for equity funds used during construction) (1,473,136) (883,703) (376,306)
Proceeds from sale of discontinued component - - 53,000
Proceeds from sale of assets 2,630 4,022 298,964
Proceeds from insurance 9,792 - -
Changes in short-term investments - 31,125 (31,125)
Increase in cash and cash equivalents attributable to previously unconsolidated subsidiaries - - 1,334
Decrease in cash and cash equivalents attributable to previously consolidated subsidiaries - - (22,039)
Other investing activities - - (5,565)
Cash Used in Investing Activities (1,454,301) (1,151,784) (237,237)
Financing Activities
Borrowing (repayment) of notes payable, net 1,197,400 196,600 (842,000)
Borrowing (repayment) of notes payable with maturities over 90 days 870,000 - (900,000)
Issuance of debt, net of issuance costs - 598,146 1,397,328
Long-term debt financing costs - (5,805) (12,003)
Payment of debt (416,040) (13,588) (44,359)
Equity unit conversion - - 402,448
Repurchase of common stock (29) (390,213) (281,444)
Issuance of common stock 16,495 20,730 10,829
Issuance of common units, net of discounts 146,969 - -
Dividends paid (162,785) (150,188) (135,451)
Distributions to minority interests (201,658) (182,891) (165,283)
Other financing activities 19,225 170 (48,841)
Cash Provided by (Used in) Financing Activities 1,469,577 72,961 (618,776)
Change in Cash and Cash Equivalents 490,953 (49,163) 17,263
Cash and Cash Equivalents at Beginning of Period 19,105 68,268 7,915
Effect of Accounting Change on Cash and Cash Equivalents - - 43,090
Cash and Cash Equivalents at End of Period $ 510,058 $ 19,105 $ 68,268
Supplemental Cash Flow Information:
Cash Paid for Interest $ 237,577 $ 253,678 $ 225,998
Cash Paid for Taxes $ 82,965 $ 57,281 $ 262,504
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CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME
Common
Stock Common Paid-in Unearned
Issued Stock Capital Compensation
(Shares) (Thousands of dollars)
December 31, 2005 107,973,436 $ 1,080 $ 1,044,283 $ (105)

Net income - - - -
Other comprehensive income (loss) - - - -
Total comprehensive income
Adoption of Statement 158 - - - -
Equity unit conversion 11,208,998 112 177,572 -
Repurchase of common stock - - - -
Common stock issued 1,151,474 11 36,862 158
Common stock dividends -
$1.22 per share - - - (53)
December 31, 2006 120,333,908 1,203 1,258,717 -
Net income - - - -
Repurchase of common stock - - (11,103) -
Common stock issued 781,309 8 26,186 -
$1.40 per share - - - -
December 31, 2007 121,115,217 1,211 1,273,800 -
Net income - - - -
Repurchase of common stock - - - -
Common stock issued 531,790 5 27,353 -
$1.56 per share - - - -
Change in measurement date for
employee benefit plans - - - -
December 31, 2008 121,647,007 $ 1,216 $ 1,301,153 $ -
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CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME
(Continued)
Accumulated
Other
Comprehensive Retained Treasury
Income (Loss) Earnings Stock Total
December 31, 2005 $ (56,991) $ 1,085,845 $ (279,355) $ 1,794,757

Net income - 306,312 - 306,312
Other comprehensive income (loss) 63,878 - - 63,878
Total comprehensive income 370,190
Adoption of Statement 158 32,645 - - 32,645
Equity unit conversion - - 224,764 402,448
Repurchase of common stock - - (285,662) (285,662)
Common Stock issued - - - 37,031
$1.22 per share - (135,398) - (135,451)
December 31, 2006 39,532 1,256,759 (340,253) 2,215,958
Net income - 304,921 - 304,921
Other comprehensive income (loss) (46,601) - - (46,601)
Repurchase of common stock - - (379,110) (390,213)
Common stock issued - - 9,237 35,431
$1.40 per share - (150,188) - (150,188)
December 31, 2007 (7,069) 1,411,492 (710,126) 1,969,308
Net income - 311,909 - 311,909
Other comprehensive income (loss) (63,547) - - (63,547)
Repurchase of common stock - - (29) (29)
Common stock issued - - 13,539 40,897
$1.56 per share - (162,785) - (162,785)
Change in measurement date for
employee benefit plans - (7,583) (7,583)
December 31, 2008 $ (70,616) $ 1,553,033 $ (696,616) $ 2,088,170
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ONEOK, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. SUMMARY OF ACCOUNTING POLICIES
Organization and Nature of Operations - We are a diversified energy company and successor to the company founded in 1906 known as
Oklahoma Natural Gas Company. Our common stock is listed on the NYSE under the trading symbol “OKE.” We are the sole general partner
and own 47.7 percent of ONEOK Partners, L.P. (NYSE: OKS), one of the largest publicly traded master limited partnerships.
We have divided our operations into four reportable business segments based on similarities in economic characteristics, products and
services, types of customers, methods of distribution and regulatory environment. These segments are as follows:
•ONEOK Partners
•Distribution
•Energy Services
•Other
Our ONEOK Partners segment is engaged in the gathering and processing of unprocessed natural gas and fractionation of NGLs, primarily in
the Mid-Continent and Rocky Mountain regions covering Oklahoma, Kansas, Montana, North Dakota and Wyoming. These operations
include the gathering of unprocessed natural gas produced from crude oil and natural gas wells. Through gathering systems, unprocessed
natural gas is aggregated and treated or processed for removal of water vapor, solids and other contaminants, and to extract NGLs in order to
provide marketable natural gas, commonly referred to as residue gas. When the NGLs are separated from the unprocessed natural gas at the
processing plants, the NGLs are generally in the form of a mixed, unfractionated NGL stream. This stream is then separated by a distillation
process, referred to as fractionation, into marketable product components such as ethane, ethane/propane (E/P), propane, iso-butane, normal
butane and natural gasoline (collectively, NGL products). These NGL products can then be stored, transported and marketed to a diverse
customer base of end-users.
ONEOK Partners also gathers, treats, fractionates, transports and stores NGLs. ONEOK Partners’ natural gas liquids gathering pipelines
deliver unfractionated NGLs gathered from natural gas processing plants located in Oklahoma, Kansas, the Texas panhandle and the Rocky
Mountain region to fractionators it owns in Oklahoma, Kansas and Texas. The NGLs are then separated through the fractionation process
into the individual NGL products that realize the greater economic value of the NGL components. The individual NGL products are then stored
or distributed to petrochemical manufacturers, heating fuel users, refineries and propane distributors through ONEOK Partners’ distribution
pipelines that move NGL products from Oklahoma and Kansas to the market centers in Conway, Kansas, and Mont Belvieu, Texas, as well as
the Midwest markets near Chicago, Illinois.
ONEOK Partners operates interstate and intrastate natural gas transmission pipelines, natural gas storage facilities and non-processable
natural gas gathering facilities. ONEOK Partners’ interstate assets transport natural gas through FERC-regulated interstate natural gas
pipelines that access supply from Canada, and the Mid-Continent, Rocky Mountain and Gulf Coast regions.
ONEOK Partners’ intrastate natural gas pipeline assets in Oklahoma have access to the major natural gas producing areas and transport
natural gas throughout the state. ONEOK Partners also has access to the major natural gas producing area in south central Kansas. In Texas,
its intrastate natural gas pipelines are connected to the major natural gas producing areas in the Texas panhandle and the Permian Basin and
transport natural gas to the Waha Hub, where other pipelines may be accessed for transportation east to the Houston Ship Channel market,
north into the Mid-Continent market and west to the California market. ONEOK Partners owns or leases storage capacity in underground
natural gas storage facilities in Oklahoma, Kansas and Texas. ONEOK Partners’ natural gas pipelines primarily serve LDCs, large industrial
companies, municipalities, irrigation customers, power generation facilities and marketing companies.
Our Distribution segment provides natural gas distribution services to more than two million customers in Oklahoma, Kansas and Texas
through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively, each a division of ONEOK. We serve residential,
commercial, industrial and transportation customers in all three states. In addition, our distribution companies in Oklahoma and Kansas serve
wholesale customers, and in Texas we serve public authority customers, such as cities, governmental agencies and schools.
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Our Energy Services segment’s primary focus is to create value for our customers by delivering physical natural gas products and risk
management services through our network of contracted transportation and storage capacity and natural gas supply. These services include
meeting our customers’ baseload, swing and peaking natural gas commodity requirements on a year-round basis. To provide these bundled
services, we lease storage and transportation capacity. Our contracted storage and transportation capacity connects major supply and
demand centers throughout the United States and into Canada. With these contracted assets, our business strategies include identifying,
developing and delivering specialized services and products valued by our customers, which are primarily LDCs, electric utilities, and
commercial and industrial end users. Our storage and transportation capacity allows us opportunities to optimize value through our
application of market knowledge and risk management skills.
Critical Accounting Policies
The following is a summary of our most critical accounting policies, which are defined as those policies most important to the portrayal of our
financial condition and results of operations and requiring our management’s most difficult, subjective or complex judgment, particularly
because of the need to make estimates concerning the impact of inherently uncertain matters. We have discussed the development and
selection of our critical accounting policies and estimates with the Audit Committee of our Board of Directors.
Fair Value Measurements - General - In September 2006, the FASB issued Statement 157, “Fair Value Measurements” that establishes a
framework for measuring fair value and requires additional disclosures about fair value measurements. Beginning January 1, 2008, we partially
applied Statement 157 as allowed by FASB Staff Position (FSP) 157-2, “Effective Date of FASB Statement No. 157” that delayed the effective
date of Statement 157 for nonrecurring fair value measurements associated with our nonfinancial assets and liabilities. As of January 1, 2008,
we applied the provisions of Statement 157 to our recurring fair value measurements, and the impact was not material upon adoption. As of
January 1, 2009, we have applied the provisions of Statement 157 to our nonrecurring fair value measurements associated with our nonfinancial
assets and liabilities, and the impact was not material. FSP 157-3, “Determining the Fair Value of a Financial Asset When the Market for That
Asset Is Not Active,” which clarified the application of Statement 157 in inactive markets, was issued in October 2008 and was effective for our
September 30, 2008, unaudited consolidated financial statements. FSP 157-3 did not have a material impact on our consolidated financial
statements.
In February 2007, the FASB issued Statement 159, “The Fair Value Option for Financial Assets and Financial Liabilities” that allows companies
to elect to measure specified financial assets and liabilities, firm commitments, and nonfinancial warranty and insurance contracts at fair value
on a contract-by-contract basis, with changes in fair value recognized in earnings each reporting period. At January 1, 2008, we did not elect
the fair value option under Statement 159, and therefore there was no impact on our consolidated financial statements.
Determining Fair Value - Statement 157 defines fair value as the price that would be received to sell an asset or transfer 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. While many of the contracts in our portfolio are
executed in liquid markets where price transparency exists, some contracts are executed in markets for which market prices may exist but the
market may be relatively inactive. This results in limited price transparency that requires management’s judgment and assumptions to estimate
fair values. Inputs into our fair value estimates include commodity exchange prices, over-the-counter quotes, volatility, historical correlations
of pricing data and LIBOR and other liquid money market instrument rates. We also utilize internally developed basis curves that incorporate
observable and unobservable market data. We validate our valuation inputs with third-party information and settlement prices from other
sources, where available. In addition, as prescribed by the income approach, we compute the fair value of our derivative portfolio by
discounting the projected future cash flows from our derivative assets and liabilities to present value. The interest rate yields used to
calculate the present value discount factors are derived from LIBOR, Eurodollar futures and Treasury swaps. The projected cash flows are
then multiplied by the appropriate discount factors to determine the present value or fair value of our derivative instruments. We also take
into consideration the potential impact on market prices of liquidating positions in an orderly manner over a reasonable period of time under
current market conditions. Finally, we consider credit risk of our counterparties on the fair value of our derivative assets, as well as our own
credit risk for derivative liabilities, using default probabilities and recovery rates, net of collateral. We also take into consideration current
market data in our evaluation when available, such as bond prices and yields and credit default swaps. Although we use our best estimates to
determine the fair value of the derivative contracts we have executed, the ultimate market prices realized could differ from our estimates, and
the differences could be material.
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Fair Value Hierarchy - - Statement 157 establishes the fair value hierarchy that prioritizes inputs to valuation techniques based on observable
and unobservable data and categorizes the inputs into three levels, with the highest priority given to Level 1 and the lowest priority given to
Level 3. The levels 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.
•Level 3 - Generally unobservable inputs, which are developed based on the best information available and may include our own
internal data.
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.
See Note C for more discussion of our fair value measurements.
Derivatives, Accounting for Financially Settled Transactions and Risk Management Activities - We engage in wholesale energy marketing,
retail marketing, trading and risk management activities. We account for derivative instruments utilized in connection with these activities and
services in accordance with Statement 133, “Accounting for Derivative Instruments and Hedging Activities,” as amended.
Under Statement 133, entities are required to record all derivative instruments at fair value, with the exception of normal purchases and normal
sales that are expected to result in physical delivery. See previous discussion in “Fair Value Measurements” for additional
information. Market value changes result in a change in the fair value of our derivative instruments. 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
nature of the risk being hedged and how we will determine if the hedging instrument is effective. If the derivative instrument does not qualify
or is not designated as part of a hedging relationship, then we account for changes in fair value of the derivative in earnings as they
occur. Commodity price volatility may have a significant impact on the gain or loss in a given period.
To reduce our exposure to fluctuations in natural gas, NGLs and condensate prices, we periodically enter into futures, forwards, options or
swap transactions in order to hedge anticipated purchases and sales of natural gas, NGLs, condensate and fuel requirements. Interest-rate
swaps are also used to manage interest-rate risk. Under certain conditions, we designate these derivative instruments as a hedge of exposure
to changes in fair values or cash flows. For hedges of exposure to changes in cash flow, the effective portion of the gain or loss on the
derivative instrument is reported initially as a component of accumulated other comprehensive income (loss) and is subsequently recorded to
earnings when the forecasted transaction affects earnings. Any ineffectiveness of designated hedges is reported in earnings during the
period the ineffectiveness occurs. For hedges of exposure to changes in fair value, the gain or loss on the derivative instrument is recognized
in earnings during the period of change, together with the offsetting gain or loss on the hedged item attributable to the risk being hedged.
Upon election, many of our purchase and sale agreements that otherwise would be required to follow derivative accounting qualify as normal
purchases and normal sales under Statement 133 and are therefore exempt from fair value accounting treatment.
The presentation of settled derivative instruments on either a gross or net basis in our Consolidated Statements of Income is dependent on a
number of factors, including whether the derivative instrument (i) is held for trading purposes; (ii) is financially settled; (iii) results in physical
delivery or services rendered; and (iv) qualifies for the normal purchase or sale exception as defined in Statement 133. In accordance with EITF
03-11, “Reporting Realized Gains and Losses on Derivative Instruments That Are Subject to FASB Statement No. 133 and not ‘Held for
Trading’ as Defined in EITF Issue No. 02-3,” EITF 99-19, “Reporting Revenue Gross as a Principal versus Net as an Agent,” and Statement
133, we report settled derivative instruments as follows:
•all financially settled derivative contracts are reported on a net basis;
•derivative instruments considered held for trading purposes that result in physical delivery are reported on a net basis;
•derivative instruments not considered held for trading purposes that result in physical delivery or services rendered are reported on a
gross basis; and
•derivatives that qualify for the normal purchase or sale exception as defined in Statement 133 are reported on a gross basis.
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We apply the indicators in EITF 99-19 to determine the appropriate accounting treatment for non-derivative contracts that result in physical
delivery.
See Note D for more discussion of derivatives and risk management activities.
Impairment of Long-Lived Assets, Goodwill and Intangible Assets - We assess our long-lived assets for impairment based on Statement 144,
“Accounting for the Impairment or Disposal of Long-Lived Assets.” A long-lived asset is tested for impairment whenever events or changes
in circumstances indicate that its carrying amount may exceed its fair value. Fair values are based on the sum of the undiscounted future cash
flows expected to result from the use and eventual disposition of the assets.
We assess our goodwill and indefinite-lived intangible assets for impairment at least annually based on Statement 142, “Goodwill and Other
Intangible Assets.” There were no impairment charges resulting from our July 1, 2008, impairment test. As a result of recent events in the
financial markets and current economic conditions, we performed a review and determined that interim testing of goodwill as of December 31,
2008, was not necessary. As a part of our impairment test, an initial assessment is made by comparing the fair value of a reporting unit with its
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 of the reporting unit 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.
We use two generally accepted valuation approaches, an income approach and a market approach, to estimate the fair value of a reporting
unit. Under the income approach, we use anticipated cash flows over a three-year period plus a terminal value and discount these amounts to
their present value using appropriate rates of return. Under the market approach, we apply multiples to forecasted EBITDA amounts. The
multiples used are consistent with historical asset transactions, and the EBITDA amounts are based on average EBITDA for a reporting unit
over a three-year forecasted period. See Note E for more discussion of goodwill.
Intangible assets with a finite useful life are amortized over their estimated useful life, while intangible assets with an indefinite useful life are
not amortized. All intangible assets are subject to impairment testing. We had $435.4 million of intangible assets recorded on our
Consolidated Balance Sheet as of December 31, 2008, of which $279.8 million in our ONEOK Partners segment is being amortized over an
aggregate weighted-average period of 40 years, while the remaining balance has an indefinite life.
Our impairment tests require the use of assumptions and estimates. 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 an impairment charge.
For the investments we account for under the equity method, the premium or excess cost over underlying fair value of net assets is referred to
as equity method goodwill and under Statement 142, is not subject to amortization but rather to impairment testing pursuant to APB Opinion
No. 18, “The Equity Method of Accounting for Investments in Common Stock.” The impairment test under APB Opinion No. 18 considers
whether the fair value of the equity investment as a whole, not the underlying net assets, has declined and whether that decline is other than
temporary. Therefore, we periodically reevaluate the amount at which we carry the excess of cost over fair value of net assets accounted for
under the equity method to determine whether current events or circumstances warrant adjustments to our carrying value in accordance with
APB Opinion No. 18.
Pension and Postretirement Employee Benefits - We have defined benefit retirement plans covering certain full-time employees. We sponsor
welfare plans that provide postretirement medical and life insurance benefits to certain employees who retire with at least five years of
service. Our actuarial consultant calculates the expense and liability 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 obligations and costs, assumptions can change
from period to period and result in material changes in the costs and liabilities we recognize. See Note J for more discussion of pension and
postretirement employee benefits.
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In September 2006, the FASB issued Statement 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans,”
which required us to record a balance sheet liability equal to the difference between our benefit obligations and plan assets. Statement 158
also required us to change our measurement date from September 30 to December 31. Statement 158 was effective for our year ended
December 31, 2006, except for the measurement date change, which was effective for our year ending December 31, 2008. We determined our
net periodic benefit cost for the period October 1, 2007, through December 31, 2008, based on a measurement date of September 30, 2007. The
net periodic benefit cost for the period of October 1, 2007, through December 31, 2007, was reflected as an adjustment to retained earnings as
of December 31, 2008. The impact of this adjustment was a $7.6 million reduction to retained earnings, net of taxes.
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 in accordance with Statement 5, “Accounting for Contingencies.” We base our
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 completion of the 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 K for additional discussion of contingencies.
Significant Accounting Policies
Consolidation - Our consolidated financial statements include the accounts of ONEOK and our subsidiaries over which we have control. We
have recorded minority interests in consolidated subsidiaries on our Consolidated Balance Sheets to recognize the percent of ONEOK Partners
that we do not own. We reflected our percent share of ONEOK Partners’ accumulated other comprehensive income (loss) in our consolidated
accumulated other comprehensive income (loss). The remaining percent is reflected as an adjustment to minority interests in consolidated
subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Investments in affiliates are
accounted for using the equity method if we have the ability to exercise significant influence over operating and financial policies of our
investee; conversely, if we do not have the ability to exercise significant influence, then we use the cost method. Impairment of equity and
cost method investments is recorded when the impairments are other than temporary.
Use of Estimates - The preparation of our consolidated 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 consolidated 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, obligations under employee benefit plans,
provisions for uncollectible accounts receivable, unbilled revenues for natural gas delivered but for which meters have not been read, gas
purchased expense for 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, consultation with experts 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.
Cash and Cash Equivalents - Cash equivalents consist of highly liquid investments, which are readily convertible into cash and have original
maturities of three months or less.
Accounts Receivable, net - Accounts receivable represent valid claims against non-affiliated customers for products sold or services rendered,
net of allowances for doubtful accounts. We assess the credit worthiness of our counterparties on an ongoing basis and require security,
including prepayments and other forms of cash collateral, when appropriate. Outstanding customer receivables are regularly reviewed for
possible non-payment indicators and allowances for doubtful accounts are recorded based upon management’s estimate of collectibility at
each balance sheet date.
Inventories - Our current natural gas and NGLs in storage are determined using the lower of weighted-average cost or market
method. Noncurrent natural gas and NGLs are classified as property and valued at cost. Materials and supplies are valued at average cost.
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Through December 31, 2007, the cost of current natural gas in storage for Oklahoma Natural Gas was determined under the last-in, first-out
(LIFO) methodology. The estimated replacement cost of current natural gas in storage was $72.4 million at December 31, 2007, compared with
its value under the LIFO method of $85.4 million at December 31, 2007. As of January 1, 2008, Oklahoma Natural Gas was required to change
from LIFO to the weighted-average cost methodology based on a change in state law. The impact of this change on our consolidated financial
statements was immaterial, as the actual cost of gas is recovered from our rate payers through our purchased gas recovery mechanism.
Natural Gas Imbalances and Commodity Exchanges - Natural gas imbalances and NGL exchanges are valued at market or their contractually
stipulated rate. Imbalances and NGL exchanges are settled in cash or made up in-kind, subject to the terms of the pipelines’ tariffs or by
agreement.
EITF Issue No. 04-13, “Accounting for Purchases and Sales of Inventory with the Same Counterparty” defines when a purchase and a sale of
inventory with the same party that operates in the same line of business should be considered a single nonmonetary transaction. EITF 04-13
was effective for new arrangements that a company enters into in periods beginning after March 15, 2006. We reviewed the applicability of
EITF 04-13 to our operations and determined that it did not have a material impact on our financial position or results of operations.
Property, Plant and Equipment - - The following table sets forth our property, plant and equipment by segment, for the periods presented.

2008 2007
Non-Regulated
ONEOK Partners $ 2,465,369 $ 2,112,394
Energy Services 7,907 7,845
Other 225,479 177,356
Regulated
ONEOK Partners 3,343,310 2,323,977
Distribution 3,434,554 3,271,920
Property, plant and equipment 9,476,619 7,893,492
Accumulated depreciation and amortization 2,212,850 2,048,311
Net property, plant and equipment $ 7,263,769 $ 5,845,181
Our properties are stated at cost which includes AFUDC. Generally, the cost of regulated property retired or sold, plus removal costs, less
salvage, is charged to accumulated depreciation. Gains and losses from sales or transfers of non-regulated properties or an entire operating
unit or system of our regulated properties are recognized in income. Maintenance and repairs are charged directly to expense.
The interest portion of AFUDC represents the cost of borrowed funds used to finance construction activities. We capitalize interest expense
during the construction or upgrade of qualifying assets. Interest expense capitalized in 2008, 2007 and 2006 was $39.9 million, $15.4 million and
$2.0 million, respectively. Capitalized interest is recorded as a reduction to interest expense. The equity portion of AFUDC represents the
capitalization of the estimated average cost of equity used during the construction of major projects and is recorded in the cost of our
regulated properties and as a credit to the allowance for equity funds used during construction.
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. For our regulated assets, these deprecation 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 billed. For our non-regulated assets, if it is
determined that the estimated economic life changes, then the changes are made prospectively. Changes in the estimated economic lives of
our property, plant and equipment could have a material effect on our financial position or result of operations.
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The average depreciation rates for our regulated property are set forth in the following table for the periods indicated.

Regulated Property 2008 2007 2006
ONEOK Partners 2.0% - 2.4% 2.4% - 2.5% 2.4% - 2.6%
Distribution 2.7% - 3.0% 2.7% - 3.0% 2.7% - 3.3%
ONEOK Partners’ average depreciation rates for its regulated property decreased in 2008, compared with 2007, due to placing newly
constructed natural gas liquids pipeline assets with longer economic lives in service.
Property, plant and equipment on our Consolidated Balance Sheets includes construction work in process for capital projects that have not
yet been put in service and therefore are not being depreciated. The following table sets forth our construction work in process, by segment,
for the periods presented.

2008 2007
ONEOK Partners $ 810.0 $ 859.8
Distribution 57.0 51.3
Other 11.0 7.1
Total construction work in process $ 878.0 $ 918.2
Assets are transferred out of construction work in process when they are substantially complete and ready for their intended use, in
accordance with Statement 34, “Capitalization of Interest Cost.”
Revenue Recognition - Our ONEOK Partners segment includes natural gas gathering and processing, natural gas liquids gathering and
fractionation, natural gas pipelines, and natural gas liquids pipelines operations. ONEOK Partners’ natural gas gathering and processing
operations record revenue when gas is processed in or transported through company facilities. ONEOK Partners’ natural gas liquids
gathering and fractionation operations record revenues based upon contracted services and actual volumes exchanged or stored under
service agreements in the month services are provided. Revenue for ONEOK Partners’ natural gas pipelines and natural gas liquids pipelines
operations is recognized based upon contracted capacity and contracted volumes transported and stored under service agreements in the
period services are provided.
Our Distribution segment’s major industrial and commercial natural gas distribution customers are invoiced as of the end of each month. All
natural gas residential distribution customers and some commercial customers are invoiced on a cyclical basis throughout the month, and we
accrue unbilled revenues at the end of each month.
Our Energy Services segment’s wholesale customers are invoiced as of the end of each month based on physical sales. Retail customers are
invoiced on a cyclical basis throughout the month, and we accrue unbilled revenues at the end of each month. Demand payments received for
requirements contracts are recognized in the period in which the service is provided. Our fixed-price physical sales are accounted for as
derivatives and are recorded at fair value. See Note D “Accounting Treatment” for additional information.
Income Taxes - Income taxes are accounted for using the provisions of Statement 109, “Accounting for Income Taxes.” Deferred income taxes
are provided 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. 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. For all other operations,
the effect is recognized in income in the period that includes the enactment date. We continue to amortize previously deferred investment tax
credits for ratemaking purposes over the period prescribed by the OCC, KCC, RRC and various municipalities in Texas.
In June 2006, the FASB issued FIN 48, “Accounting for Uncertainty in Income Taxes - An Interpretation of FASB Statement No. 109,” which
was effective for our year beginning January 1, 2007. This interpretation was issued to clarify the accounting for uncertainty in income taxes
recognized in the financial statements by prescribing a recognition threshold and measurement attribute for the financial statement recognition
and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 requires the recognition of penalties and interest on
any unrecognized tax benefits. Our policy is to
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reflect penalties and interest as part of income tax expense as they become applicable. The adoption of FIN 48 had an immaterial impact on our
consolidated financial statements, and the impact for 2008 and 2007 was not material.
We file numerous consolidated and separate income tax returns in the United States federal jurisdiction and in many state jurisdictions. We
also file returns in Canada. No extensions of statute of limitations have been requested or granted. Our 2007 and 2006 United States federal
income tax returns are currently under audit.
Regulation - Our distribution operations and ONEOK Partners’ intrastate natural gas transmission pipelines are subject to the rate regulation
and accounting requirements of the OCC, KCC, RRC and various municipalities in Texas. ONEOK Partners’ interstate natural gas and natural
gas liquids pipelines are subject to regulation by the FERC. In Kansas and Texas, natural gas storage may be regulated by the state and the
FERC for certain types of services. Oklahoma Natural Gas, Kansas Gas Service, Texas Gas Service and portions of our ONEOK Partners
segment follow the accounting and reporting guidance contained in Statement 71, “Accounting for the Effects of Certain Types of
Regulation.” During the rate-making process, regulatory authorities set the framework for what we can charge customers for 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. Certain examples of types of regulatory guidance
include costs for fuel and losses, acquisition costs, contributions in aid of construction, charges for depreciation, and gains or losses on
disposition of assets. 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 affect 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. If all or a portion of the regulated
operations are no longer subject to the provisions of Statement 71, a write-off of regulatory assets and costs not recovered may be required.
At December 31, 2008 and 2007, we recorded regulatory assets of approximately $523.3 million and $309.4 million, respectively, which are being
recovered through various rate cases or are expected to be recovered. Regulatory assets are being recovered as a result of approved rate
proceedings over varying time periods up to 40 years. These assets are reflected in other assets on our Consolidated Balance Sheets.
Asset Retirement Obligations - Statement 143, “Accounting for Asset Retirement Obligations,” applies to legal obligations associated with
the retirement of long-lived assets that result from the acquisition, construction, development and/or normal use of the asset. Statement 143
requires that 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. The fair value of the liability is added to the carrying amount of the associated asset, and this additional
carrying amount is depreciated over the life of the asset. The liability is accreted at the end of each period through charges to operating
expense. If the obligation is settled for an amount other than the carrying amount of the liability, we will recognize a gain or loss on
settlement. The depreciation and amortization expense is immaterial to our consolidated financial statements.
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 are non-legal
obligations as defined by Statement 143. However, these non-legal asset-removal obligations are accounted for as a regulatory liability under
Statement 71. Historically, the regulatory authorities that have jurisdiction over our regulated operations have not required us to track this
amount; rather, these costs are addressed prospectively as depreciation rates and are set in each general rate order. We have made an
estimate of our removal cost liability using current rates since the last general rate order in each of our jurisdictions. However, significant
uncertainty exists regarding the ultimate determination of this liability, pending, among other issues, clarification of regulatory intent. We
continue to monitor the regulatory authorities and the liability may be adjusted as more information is obtained. We have reclassified the
estimated non-legal asset removal obligation from accumulated deprecation and amortization to non-current liabilities in other deferred credits
on our Consolidated 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.
Share-Based Payment - Statement 123R, “Share-Based Payment,” requires companies to expense the fair value of share-based payments net of
estimated forfeitures. We adopted Statement 123R as of January 1, 2006, and elected to use the modified prospective method. Statement 123R
did not have a material impact on our consolidated financial statements as we have been expensing share-based payments since our adoption
of Statement 148, “Accounting for Stock-Based Compensation - Transition and Disclosure,” on January 1, 2003. Awards granted after the
adoption of Statement 123R are expensed under the requirements of Statement 123R, while equity awards granted prior to the adoption of
Statement 123R will continue to be expensed under Statement 148.
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Earnings per Common Share - Basic EPS is calculated based on the daily weighted-average number of shares of common stock outstanding
during the period. Diluted EPS is calculated based on the daily weighted-average number of shares of common stock outstanding during the
period plus potentially dilutive components. The dilutive components are calculated based on the dilutive effect for each quarter. For fiscal
year periods, the dilutive components for each quarter are averaged to arrive at the fiscal year-to-date dilutive component.
Other
Master Netting Arrangements - In April 2007, the FASB issued FSP FIN 39-1, “Amendment of FASB Interpretation No. 39,” which requires
entities that offset the fair value amounts recognized for derivative receivables and payables to also offset the fair value amounts recognized
for the right to reclaim cash collateral with the same counterparty under a master netting arrangement. We applied the provisions of FSP FIN
39-1 to our consolidated financial statements beginning January 1, 2008, and the impact was not material. See Note C for applicable
disclosures.
Business Combinations - In December 2007, the FASB issued Statement 141R, “Business Combinations,” which will require most identifiable
assets, liabilities, noncontrolling interest (previously referred to as minority interest) and goodwill acquired in a business combination to be
recorded at fair value. Statement 141R was effective for our year beginning January 1, 2009. Because the provisions of Statement 141R are
applied prospectively, our 2009 and subsequent consolidated financial statements will not be impacted unless we complete a business
combination.
Noncontrolling Interests - In December 2007, the FASB issued Statement 160, “Noncontrolling Interest in Consolidated Financial Statements -
an amendment to ARB No. 51,” which requires a noncontrolling interest (previously referred to as minority interest) to be reported as a
component of equity. Statement 160 was effective for our year beginning January 1, 2009, and requires retroactive adoption of the
presentation and disclosure requirements for existing minority interests beginning with our March 31, 2009, Quarterly Report on Form 10-
Q. Statement 160 is not expected to have a material impact on our consolidated financial statements; however, certain financial statement
presentation changes and additional required disclosures will be made.
Derivative Instruments and Hedging Activities Disclosure - In March 2008, the FASB issued Statement 161, “Disclosures about Derivative
Instruments and Hedging Activities - an amendment to FASB Statement No. 133,” which requires enhanced disclosures about how derivative
and hedging activities affect our financial position, financial performance and cash flows. Statement 161 was effective for our year beginning
January 1, 2009, and will be applied prospectively beginning with our March 31, 2009, Quarterly Report on Form 10-Q.
Equity Method Investments - In November 2008, the FASB ratified EITF 08-6, “Equity Method Investment Accounting Considerations,” which
clarified certain issues that arose following the issuance of Statements 141R and 160 related to the accounting for equity method
investments. EITF 08-6 was effective for our year beginning January 1, 2009, and is not expected to have a material impact on our consolidated
financial statements.
Postretirement Benefit Plan Assets - In December 2008, the FASB issued FSP FAS 132R-1, “Employers’ Disclosures about Postretirement
Benefit Plan Assets,” which amends Statement 132R, “Employers’ Disclosures about Pensions and Other Postretirement Benefits,” to require
enhanced disclosures about our plan assets, including our investment policies, major categories of plan assets, significant concentrations of
risk within plan assets, and inputs and valuation techniques used to measure the fair value of plan assets. FSP FAS 132R-1 is effective for our
fiscal year ending December 31, 2009, and will be applied prospectively.
Reclassifications - Certain amounts in our consolidated financial statements have been reclassified to conform to the 2008
presentation. These reclassifications did not impact previously reported net income or shareholders’ equity.
B. ACQUISITIONS AND DIVESTITURES
Acquisition of NGL Pipeline - In October 2007, ONEOK Partners completed the acquisition of an interstate natural gas liquids and refined
petroleum products pipeline system and related assets from a subsidiary of Kinder Morgan Energy Partners, L.P. (Kinder Morgan) for
approximately $300 million, before working capital adjustments. The system extends from Bushton and Conway, Kansas, to Chicago, Illinois,
and transports, stores and delivers a full range of NGL and refined petroleum products. The FERC-regulated system spans 1,624 miles and has
a capacity to transport up to 134 MBbl/d. The transaction also included approximately 978 MBbl of owned storage capacity, eight NGL
terminals and a 50 percent
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ownership of Heartland. ConocoPhillips owns the other 50 percent of Heartland and is the managing partner of the Heartland joint venture,
which consists primarily of a refined petroleum products terminal and pipelines with access to two other refined petroleum products
terminals. ONEOK Partners’ investment in Heartland is accounted for under the equity method of accounting. Financing for this transaction
came from a portion of the proceeds of ONEOK Partners’ September 2007 issuance of $600 million 6.85 percent Senior Notes due 2037 (the 2037
Notes). See Note I for a discussion of the 2037 Notes. The working capital settlement was finalized in April 2008, with no material adjustments.
Overland Pass Pipeline Company - - In May 2006, a subsidiary of ONEOK Partners entered into an agreement with a subsidiary of The
Williams Companies, Inc. (Williams) to form a joint venture called Overland Pass Pipeline Company. In November 2008, Overland Pass Pipeline
Company completed construction of a 760-mile natural gas liquids pipeline from Opal, Wyoming, to the Mid-Continent natural gas liquids
market center in Conway, Kansas. The Overland Pass Pipeline is designed to transport approximately 110 MBbl/d of unfractionated NGLs and
can be increased to approximately 255 MBbl/d with additional pump facilities. During 2006, ONEOK Partners paid $11.6 million to Williams for
the acquisition of its interest in the joint venture and for reimbursement of initial capital expenditures. A subsidiary of ONEOK Partners owns
99 percent of the joint venture, managed the construction project, advanced all costs associated with construction and is currently operating
the pipeline. On or before November 17, 2010, Williams will have the option to increase its ownership up to 50 percent, with the purchase price
being determined in accordance with the joint venture’s operating agreement. If Williams exercises its option to increase its ownership to the
full 50 percent, Williams would have the option to become operator. The pipeline project cost was approximately $575 million, excluding
AFUDC.
As part of a long-term agreement, Williams dedicated its NGL production from two of its natural gas processing plants in Wyoming to the
Overland Pass Pipeline. Subsidiaries of ONEOK Partners will provide downstream fractionation, storage and transportation services to
Williams.
ONEOK Partners - In April 2006, we sold certain assets comprising our former gathering and processing, natural gas liquids, and pipelines
and storage segments to ONEOK Partners for approximately $3 billion, including $1.35 billion in cash, before adjustments, and approximately
36.5 million Class B limited partner units in ONEOK Partners. The Class B limited partner units and the related general partner interest
contribution were valued at approximately $1.65 billion. We also purchased, through ONEOK Partners GP, from an affiliate of TransCanada,
17.5 percent of the general partner interest in ONEOK Partners for $40 million. This purchase resulted in our ownership of the entire 2 percent
general partner interest in ONEOK Partners. Following the completion of the transactions, we owned a total of approximately 37.0 million
common and Class B limited partner units and the entire 2 percent general partner interest and control the partnership. Our overall interest in
ONEOK Partners, including the 2 percent general partner interest, was 45.7 percent at the date of acquisition.
Disposition of 20 percent interest in Northern Border Pipeline - In April 2006, in connection with the transactions described immediately
above, our ONEOK Partners segment completed the sale of a 20 percent partnership interest in Northern Border Pipeline to TC PipeLines for
approximately $297 million. Our ONEOK Partners segment recorded a gain on the sale of approximately $113.9 million in the second quarter of
2006. ONEOK Partners and TC PipeLines each now own a 50 percent interest in Northern Border Pipeline, and an affiliate of TransCanada
became operator of the pipeline in April 2007. Neither ONEOK Partners nor TC PipeLines has control of Northern Border Pipeline, as control is
shared equally through Northern Border Pipeline’s Management Committee. As a result of this transaction, ONEOK Partners’ interest in
Northern Border Pipeline has been accounted for as an investment under the equity method, applied on a retroactive basis to January 1, 2006.
Acquisition of Guardian Pipeline Interests - In April 2006, our ONEOK Partners segment acquired the 66-2/3 percent interest in Guardian
Pipeline not previously owned by ONEOK Partners for approximately $77 million, increasing its ownership interest to 100 percent. ONEOK
Partners used borrowings from its credit facility to fund the acquisition of the additional interest in Guardian Pipeline. Following the
completion of the transaction, we consolidated Guardian Pipeline in our consolidated financial statements. This change was accounted for on
a retroactive basis to January 1, 2006.
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C. FAIR VALUE MEASUREMENTS
See Note A for a discussion of our fair value measurements and the fair value hierarchy.
Recurring Fair Value Measurements - The following table sets forth our recurring fair value measurements for the period indicated.
December 31, 2008

Level 1 Level 2 Level 3 Netting (a) Total
Assets
Derivatives $ 580,029 $ 215,116 $ 454,377 $ (840,814) $ 408,708
Trading securities 4,910 - - - 4,910
Available-for-sale investment securities 1,665 - - - 1,665
Fair value of firm commitments - - 42,179 - 42,179
Total assets $ 586,604 $ 215,116 $ 496,556 $ (840,814) $ 457,462
Liabilities
Derivatives $ (501,726) $ (55,705) $ (412,022) $ 748,136 $ (221,317)
Long-term debt swapped to floating - - (171,455) - (171,455)
Total liabilities $ (501,726) $ (55,705) $ (583,477) $ 748,136 $ (392,772)
(a) - Our derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis. We net derivative assets and
liabilities, including cash collateral in accordance with FSP FIN 39-1, when a legally enforceable master netting arrangement exists between us
and the counterparty to a derivative contract. At December 31, 2008, we held $92.7 million of cash collateral.
For derivatives for which fair value is determined based on multiple inputs, Statement 157 requires that the measurement for an individual
derivative be categorized within a single level based on the lowest-level input that is significant to the fair value measurement in its entirety.
Our Level 1 fair value measurements are based on NYMEX-settled prices, actively quoted prices for equity securities and foreign currency
forward exchange rates. These balances are predominantly comprised of exchange-traded derivative contracts, including futures and certain
options for natural gas and crude oil, that are valued based on unadjusted quoted prices in active markets. Also included in Level 1 are
available-for-sale and trading securities and foreign currency forwards.
Our Level 2 fair value inputs are based on NYMEX-settled prices that are utilized to determine the fair value of certain non-exchange-traded
financial instruments, including natural gas and crude oil swaps.
Our Level 3 inputs are based on over-the-counter quotes, market volatilities derived from NYMEX-settled prices, internally developed basis
curves incorporating observable and unobservable market data, modeling techniques using observable market data and historical correlations
of NGL product prices to crude oil, and spot and forward LIBOR curves. The derivatives categorized as Level 3 include over-the-counter
swaps and options for natural gas and crude oil, NGL swaps and forwards, natural gas basis and swing swaps and physical forward contracts,
and interest-rate swaps. Also included in Level 3 are the fair values of firm commitments and long-term debt that have been hedged.
Transfers in and out of Level 3 typically result from derivatives for which fair value is determined based on multiple inputs. Since we
categorize our derivatives based on the lowest level input that is significant, a derivative can move between Level 2 and Level 3 as the value of
the various inputs changes.
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The following table sets forth the reconciliation of our Level 3 fair value measurements for the period indicated.
Derivative Fair Value of

Assets Firm Long-Term
(Liabilities) Commitments Debt Total
January 1, 2008 $ (54,582) $ 42,684 $ (338,538) $ (350,436)
Total realized/unrealized gains (losses):
Included in earnings (a) 6,080 (505) (2,917) 2,658
Included in other comprehensive
income (loss) 84,592 - - 84,592
Terminations prior to maturity (5,074) - 170,000 164,926
Transfers in and/or out of Level 3 11,339 - - 11,339
December 31, 2008 $ 42,355 $ 42,179 $ (171,455) $ (86,921)
Total gains (losses) for the period included in

earnings attributable to the change in unrealized
gains (losses) relating to assets and liabilities
still held as of December 31, 2008 (a) $ (116,127) $ 153,221 $ (2,917) $ 34,177
(a) - Reported in revenues in our Consolidated Statements of Income.
Realized/unrealized gains (losses) include the realization of our fair value derivative contracts through maturity, changes in fair value of our
hedged firm commitments and fixed-rate debt swapped to floating. Terminations prior to maturity represents swap contracts terminated prior
to maturity that will remain in accumulated other comprehensive income (loss) until the underlying forecasted transaction occurs; and the
long-term debt associated with the interest rate swaps that were terminated during the period. Transfers into Level 3 represent existing assets
or liabilities that were previously categorized at a higher level for which the inputs to our models became unobservable. Transfers out of Level
3 represent existing assets and liabilities that were previously classified as Level 3 for which the inputs became observable in accordance with
our hierarchy policy discussed on page 78.
Fair Value - The following table represents the fair value of our energy marketing and risk management assets and liabilities for the periods
indicated.

Assets Liabilities Assets Liabilities
Energy Services - financial non-trading instruments:
Natural gas
Exchange-traded instruments $ 31,509 $ 640 $ 4,739 $ 14,853
Over-the-counter swaps 73,095 1,624 41,633 19,160
Options 186 - 1,887 2,467
Other (a) 39,453 2,515 7,469 2,741
144,243 4,779 55,728 39,221
Energy Services - financial trading instruments:
Natural gas
Exchange-traded instruments 6,158 144 1,641 888
Over-the-counter swaps 14,002 321 11,258 8,013
Options 7,043 191 14,173 18,654
Other (a) 358 249 420 287
27,561 905 27,492 27,842
ONEOK Partners - cash flow hedges 63,780 - - 21,304
Distribution - natural gas swaps - 23,003 - 9,752
Energy Services - cash flow hedges 62,250 44,248 57,966 8,344
Energy Services - fair value hedges 109,419 148,382 5,237 51,343
Interest rate swaps - fair value hedges 1,455 - 1,496 2,958
Total fair value $ 408,708 $ 221,317 $ 147,919 $ 160,764

(a) - Other includes physical natural gas.
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Financial Instruments - The following information represents the carrying amounts and estimated fair values of our financial instruments for
the periods indicated, excluding energy marketing and risk management assets and liabilities, which are listed in the table above.
The approximate fair value of cash and cash equivalents, short-term investments, accounts and notes receivable and accounts and notes
payable is equal to book value, due to their short-term nature. The estimated fair value of long-term debt has been determined using quoted
market prices of the same or similar issues, discounted cash flows, and/or rates currently available to us for debt with similar terms and
remaining maturities. The book value of our long-term debt was $4.23 billion and $4.64 billion at December 31, 2008 and 2007,
respectively. The approximate fair value of our long-term debt was $3.95 billion and $4.75 billion at December 31, 2008 and 2007, respectively.
The tables below show information about our investment securities classified as available-for-sale.
December 31,
2008 2007 2006
Available-for-sale securities held
Aggregate fair value $ 1,665 $ 24,151 $ 22,416
Reported in accumulated other
comprehensive income (loss) for net
unrealized holding gains $ 815 $ 13,678 $ 12,614

2008 2007 2006
Available-for-sale securities held
Gains reclassified to earnings
from accumulated other
comprehensive income (loss) $ 11,142 $ - $ -
Available-for-sale securities sold

Proceeds from sale (a) $ 3,886 $ - $ -
Gain from sale (a) $ 3,369 $ - $ -
(a) - We sold a portion of our available-for-sale securities and used specific identification
to determine the cost of the securities sold.
We transferred securities from available-for-sale to trading during the year ended December 31, 2008, and recognized a $7.7 million gain, due to
a reconsideration event in August 2008 when our NYMEX Holding, Inc. Class A shares held were converted to CME Group, Inc. (CME) Class
A shares due to the NYMEX Holding, Inc. and CME merger. A modification was made to the number of shares required to be maintained by
NYMEX Holding, Inc. Class A Members which resulted in our sale of certain shares and the reclassification of the remaining shares to
trading. These trading securities were still held as of December 31, 2008.
The gains reclassified into earnings from accumulated other comprehensive income (loss) for the year ended December 31, 2008, of $11.1
million include the $7.7 million gain discussed in the previous paragraph, as well as a $3.4 million realized gain on the sale of available-for-sale
securities.
D. ENERGY MARKETING AND RISK MANAGEMENT ACTIVITIES
Risk Policy and Oversight - Market risks are monitored by our risk control group that is responsible for ensuring compliance with our risk
management policies.
We control the scope of risk management, marketing and trading operations through a comprehensive set of policies and procedures
involving senior levels of management. The Audit Committee of our Board of Directors has oversight responsibilities for our risk management
limits and policies. Our risk oversight committee, comprised of corporate and business segment officers, oversees all activities related to
commodity price and credit risk management, and marketing and
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trading activities. The committee also monitors risk metrics including value-at-risk (VAR) and mark-to-market losses. We have a corporate risk
control organization that is assigned responsibility for establishing and enforcing the policies and procedures and monitoring certain risk
metrics. Key risk control activities include credit review and approval, credit and performance risk measurement and monitoring, validation of
transactions, portfolio valuation, VAR and other risk metrics.
Commodity and Interest Rate Risk Management Activities - Our operating results are affected by commodity price fluctuations. We routinely
enter into derivative financial instruments to minimize the risk of commodity price fluctuations related to anticipated sales of natural gas and
condensate, NGLs, purchase and sale commitments, fuel requirements, currency exposure, transportation and storage contracts, and natural
gas inventories. We are also subject to the risk of interest-rate fluctuations in the normal course of business. We manage interest-rate risk
through the use of fixed-rate debt, floating-rate debt and, at times, interest-rate swaps.
Our Energy Services segment includes our wholesale and retail natural gas marketing and financial trading operations. Our Energy Services
segment mitigates the commodity risk associated with our fixed-price physical purchase and sale commitments through the use of derivative
instruments. With respect to the net open positions that exist within our marketing and financial trading operations, fluctuating commodity
market prices can impact our financial position and results of operations, either favorably or unfavorably. The net open positions are actively
managed, and the impact of the changing prices on our financial condition at a point in time is not necessarily indicative of the impact of price
movements throughout the year.
Operating margins associated with ONEOK Partners’ natural gas gathering and processing and natural gas liquids gathering and fractionation
businesses are sensitive to changes in natural gas, condensate and NGL prices, principally as a result of contractual terms under which natural
gas is processed and products are sold. ONEOK Partners uses physical forward sales and derivative instruments to secure a certain price for
natural gas, condensate and NGL products.
Our Distribution segment also uses derivative instruments to hedge the cost of anticipated natural gas purchases during the winter heating
months to protect their customers from upward volatility in the market price of natural gas. Gains or losses associated with these derivative
instruments are included in, and recoverable through, the monthly purchased gas cost mechanism.
Accounting Treatment - We account for derivative instruments and hedging activities in accordance with Statement 133. Under Statement 133,
entities are required to record 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. If the derivative instrument does not qualify or is not
designated as part of a hedging relationship, we account for changes in fair value of the derivative instrument in earnings as they occur. We
record changes in the fair value of derivative instruments that are considered held for trading purposes as revenues and derivative instruments
considered not held for trading purposes as cost of sales and fuel in our Consolidated Statements of Income. If certain conditions are met,
entities may elect to designate a derivative instrument as a hedge of exposure to changes in fair values, cash flows or foreign currencies. For
hedges of exposure to changes in fair value, the gain or loss on the derivative instrument is recognized in earnings during the period of change
together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. The difference between the change in fair
value of the derivative instrument and the change in fair value of the hedged item represents hedge ineffectiveness, which is reported in
earnings during the period the ineffectiveness occurs. For hedges of exposure to changes in cash flow, the effective portion of the gain or
loss on the derivative instrument is reported initially as a component of accumulated other comprehensive income (loss) and is subsequently
recorded in earnings when the forecasted transaction affects earnings.
As required by Statement 133, we formally document all relationships between hedging instruments and hedged items, as well as risk
management objectives, strategies for undertaking various hedge transactions and methods for assessing and testing correlation and hedge
ineffectiveness. We specifically identify the asset, liability, firm commitment or forecasted transaction that has been designated as the hedged
item. We assess the effectiveness of hedging relationships by performing a regression analysis on our cash flow and fair value hedging
relationships quarterly to ensure the hedge relationships are highly effective on a retrospective and prospective basis, as required by
Statement 133. We also document our normal physical purchases and physical sales transactions that we elect to exempt from fair value
accounting treatment. Although we believe we have appropriate internal controls over our accounting for derivatives, interpreting Statement
133 and the related documentation requirements is very complex. In addition, future interpretations may impact our application of Statement
133.
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EITF 03-11, “Reporting Realized Gains and Losses on Derivative Instruments That Are Subject to FASB Statement No. 133 and Not ‘Held for
Trading Purposes’ as Defined in EITF Issue No. 02-3,” provides that the determination of whether realized gains and losses on physically
settled derivative contracts not held for trading purposes should be reported in the Consolidated Statements of Income on a gross or net basis
is a matter of judgment that depends on the relevant facts and circumstances. Consideration of the facts and circumstances should be made in
the context of the various activities of the entity rather than based solely on the terms of the individual contracts.
We evaluate the accounting treatment related to the presentation of revenues from the different types of activities to determine which amounts
should be reported on a gross or net basis under the guidance in EITF 03-11. For derivative instruments considered held for trading purposes
that result in physical delivery, the indicators in EITF 02-3, “Issues Involved in Accounting for Derivative Contracts Held for Trading
Purposes and Contracts Involved in Energy Trading and Risk Management Activities” are used to determine the proper treatment. These
activities and all financially settled derivative contracts are reported on a net basis.
For derivative instruments that are not considered held for trading purposes and that result in physical delivery, the indicators in EITF 03-11
and EITF Issue No. 99-19, “Reporting Revenue Gross as a Principal versus Net as an Agent,” are used to determine the proper treatment. We
account for the realized revenues and purchase costs of these contracts that result in physical delivery on a gross basis. We apply the
indicators in EITF 99-19 to determine the appropriate accounting treatment for non-derivative contracts that result in physical
delivery. Derivatives that qualify for the normal purchase or sale exception as defined in Statement 133 are also reported on a gross basis.
Cash flows from futures, forwards, options and swaps that are accounted for as hedges are included in the same cash flow statement category
as the cash flows from the related hedged items.
Fair Value Hedges - In 2008 and prior years, we and ONEOK Partners terminated various interest-rate swap agreements. The net savings from
the termination of these swaps is being recognized in interest expense over the terms of the debt instruments originally hedged. Net interest
expense savings for 2008 from amortization of terminated swaps was $10.5 million, and the remaining net savings for all terminated swaps will
be recognized over the following periods.
ONEOK
ONEOK Partners Total
2009 $ 6.5 $ 3.7 $ 10.2
2010 $ 6.4 $ 3.7 $ 10.1
2011 $ 3.4 $ 0.9 $ 4.3
2012 $ 1.7 $ - $ 1.7
2013 $ 1.7 $ - $ 1.7
Thereafter $ 25.3 $ - $ 25.3
At December 31, 2008, the interest on $170 million of our fixed-rate debt was swapped to floating using interest-rate swaps. The floating rate
was based on both the three- and six-month LIBOR, depending upon the swap. Based on the actual performance for the year ended December
31, 2008, the weighted-average interest rate on the swapped debt decreased from 6.17 percent to 4.39 percent. At December 31, 2008, we
recorded a net asset of $1.5 million to recognize the interest-rate swaps at fair value. Long-term debt includes an additional $1.5 million to
recognize the change in the fair value of the related hedged debt. ONEOK Partners had no interest-rate swap agreements at December 31,
2008. See Note I for additional discussion of long-term debt.
Our Energy Services segment uses basis swaps to hedge the fair value of certain firm transportation commitments. Net gains or losses from
the fair value hedges and ineffectiveness are recorded to cost of sales and fuel. The ineffectiveness related to these hedges included losses of
$3.3 million, $5.3 million and $9.0 million for 2008, 2007 and 2006, respectively.
In September 2007, our Energy Services segment was notified that a portion of the volume contracted under our firm transportation agreement
with Cheyenne Plains Gas Pipeline Company would be curtailed due to a fire at a Cheyenne Plains pipeline compressor station. The fire
damaged a significant amount of instrumentation and electrical wiring, causing Cheyenne Plains Gas Pipeline Company to declare a force
majeure event on the pipeline. This firm commitment was hedged in accordance with Statement 133. The discontinuance of fair value hedge
accounting on the portion of the firm commitment
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that was impacted by the force majeure event resulted in a loss of approximately $5.5 million in the third quarter of 2007, of which $2.4 million of
insurance proceeds were recovered and recognized in the first quarter of 2008.
Cash Flow Hedges - Our Energy Services segment uses derivative instruments to hedge the cash flows associated with our anticipated
purchases and sales of natural gas and the cost of fuel used in transportation of natural gas. Accumulated other comprehensive income (loss)
at December 31, 2008, includes gains of approximately $10.3 million, net of tax, related to these hedges that will be realized within the next 24
months as forecasted transactions affect earnings. If prices remain at current levels, we will recognize $7.2 million in net gains over the next 12
months, and we will recognize net gains of $3.1 million thereafter. In accordance with Statement 133, the actual gains or losses will be
reclassified into earnings when the related physical transactions affect earnings.
During the third and fourth quarters of 2008, the carrying value of natural gas in storage was written down by $308.5 million in order to record
inventory at the lower of cost or market. As required by Statement 133, we reclassified $298.8 million of deferred gains, before income taxes, on
associated cash flow hedges from accumulated other comprehensive income (loss) into earnings.
Through an affiliate, our ONEOK Partners segment periodically enters into derivative instruments to hedge the cash flows associated with its
exposure to changes in the price of natural gas, NGLs and condensate. At December 31, 2008, our ONEOK Partners’ segment reflected an
unrealized gain of $20.1 million, net of tax, in accumulated other comprehensive income (loss), with a corresponding offset in energy marketing
and risk management assets and liabilities, all of which will be recognized over the next 12 months.
Ineffectiveness related to our cash flow hedges resulted in gains of approximately $1.4 million, $0.2 million and $15.0 million in 2008, 2007 and
2006, respectively. In the event that it becomes probable that a forecasted transaction will not occur, we would discontinue cash flow hedge
treatment, which would affect earnings. There were no material gains or losses in 2008, 2007 or 2006 due to the discontinuance of cash flow
hedge treatment.
Credit Risk - We maintain credit policies with regard to our counterparties that we believe minimize overall credit risk. These policies include
an evaluation of potential counterparties’ financial condition (including credit ratings and credit default swap rates), collateral requirements
under certain circumstances and the use of standardized agreements which allow for netting of positive and negative exposures associated
with a single counterparty.
Our counterparties consist primarily of financial institutions, major energy companies, LDCs, electric utilities and commercial and industrial
end-users. This concentration of counterparties may impact our overall exposure to credit risk, either positively or negatively, in that the
counterparties may be similarly affected by changes in economic, regulatory or other conditions. Based on our policies, exposures, credit and
other reserves, we do not anticipate a material adverse effect on our financial position or results of operations as a result of counterparty
nonperformance.
E. GOODWILL AND INTANGIBLE ASSETS
Goodwill
Carrying Amount - The following table sets forth goodwill recorded on our Consolidated Balance Sheets for the periods indicated.
December 31,
2008 2007
ONEOK Partners $ 433,537 $ 431,418
Distribution 157,953 157,953
Energy Services 10,255 10,255
Other 1,099 1,099
Total Goodwill $ 602,844 $ 600,725
Equity Method Goodwill - For the investments we account for under the equity method, the premium or excess cost over underlying fair value
of net assets is referred to as equity method goodwill. Investment in unconsolidated affiliates on our accompanying Consolidated Balance
Sheets includes equity method goodwill of $185.6 million as of December 31, 2008 and 2007.
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Impairment Test - We apply the provisions of Statement 142 and perform our annual impairment test on July 1. There were no impairment
charges resulting from our July 1, 2008, impairment test. As a result of recent events in the financial markets and current economic conditions,
we performed a review and determined that interim testing of goodwill as of December 31, 2008, was not necessary.
Black Mesa - During 2006, we recorded a goodwill and asset impairment related to ONEOK Partners’ Black Mesa Pipeline of $8.4 million and
$3.6 million, respectively, which was recorded as depreciation and amortization. The reduction to our net income, net of minority interests and
income taxes, was $3.0 million.
Intangible Assets
Our ONEOK Partners segment had $279.8 million of intangible assets primarily related to acquired contracts, which are being amortized over an
aggregate weighted-average period of 40 years. The remaining intangible asset balance has an indefinite life. Amortization expense for
intangible assets for both 2008 and 2007 was $7.7 million, and the aggregate amortization expense for each of the next five years is estimated to
be approximately $7.7 million. The following table reflects the gross carrying amount and accumulated amortization of intangible assets for the
periods presented.
Gross Accumulated Net

Intangible Assets Amortization Intangible Assets
December 31, 2007 $ 462,214 $ (19,166) $ 443,048
December 31, 2008 $ 462,214 $ (26,832) $ 435,382
F. OTHER COMPREHENSIVE INCOME (LOSS)
The table below shows the gross amount of other comprehensive income (loss) and related tax (expense) benefit for the periods indicated.
Year Ended Year Ended

Tax (Expense) Tax (Expense)
Gross or Benefit Net Gross or Benefit Net
Unrealized gains on energy
marketing and risk
management assets/liabilities $ 276,400 (103,705) $ 172,695 $ 48,888 $ (21,836) $ 27,052
Less: Gains on energy marketing and
risk management assets/liabilities
recognized in net income 277,413 (107,303) 170,110 149,535 (57,840) 91,695
Unrealized holding gains (losses) on
investment securities arising
during the period (9,837) 3,805 (6,032) 1,735 (671) 1,064
Less: Gains on investment securities
recognized in net income 11,142 (4,310) 6,832 - - -
Change in pension and postretirement
benefit plan liability (86,869) 33,601 (53,268) 27,687 (10,709) 16,978
Other comprehensive income (loss) $ (108,861) $ 45,314 $ (63,547) $ (71,225) $ 24,624 $ (46,601)
The gains on energy marketing and risk management assets/liabilities recognized in net income presented in the table above include the
reclassification of gains on our cash flow hedges from accumulated other comprehensive income (loss) into earnings as discussed in Note D.
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The table below shows the balance in accumulated other comprehensive income (loss) for the periods indicated.
Unrealized Gains Unrealized

(Losses) on Energy Holding Pension and Accumulated
Marketing and Gains (Losses) on Postretirement Other
Risk Management Investment Benefit Plan Comprehensive
Assets/Liabilities Securities Obligations Income (Loss)
December 31, 2006 $ 89,971 $ 12,614 $ (63,053) $ 39,532
Other comprehensive income (loss) (64,643) 1,064 16,978 (46,601)
December 31, 2007 $ 25,328 $ 13,678 $ (46,075) $ (7,069)
Other comprehensive income (loss) 2,585 (12,864) (53,268) (63,547)
December 31, 2008 $ 27,913 $ 814 $ (99,343) $ (70,616)
G. CAPITAL STOCK
Series A and B Convertible Preferred Stock - There are no shares of Series A or Series B currently outstanding.
Series C Preferred Stock - Series C Preferred Stock (Series C) is designed to protect our shareholders from coercive or unfair takeover
tactics. If issued, holders of shares of Series C are entitled to receive, in preference to the holders of ONEOK Common Stock, quarterly
dividends in an amount per share equal to the greater of $0.50 or, subject to adjustment, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in kind) of all non-cash dividends. No shares of Series C have been issued.
Common Stock - At December 31, 2008, we had approximately 175 million shares of authorized and unreserved common stock available for
issuance.
Stock Repurchase Plan - On May 17, 2007, our Board of Directors authorized a stock buy back program to repurchase up to 7.5 million shares
of our currently issued and outstanding common stock. On June 28, 2007, we repurchased 7.5 million shares of our outstanding common stock
under an accelerated share repurchase agreement with Bank of America, N.A. (Bank of America) at an initial price of $49.33 per share for a total
of $370 million. Bank of America borrowed 7.5 million of our shares from third parties and purchased shares in the open market to settle its
short position. Our repurchase was subject to a financial adjustment based on the volume-weighted average price, less a discount, of the
shares subsequently repurchased by Bank of America over the course of the repurchase period. The price adjustment could have been
settled, at our option, in cash or in shares of our common stock. In September 2007, the accelerated share repurchase agreement with Bank of
America was settled, which resulted in Bank of America delivering an additional 186,402 shares of our common stock to us at no additional
cost. All shares under this accelerated repurchase agreement were recorded as treasury shares in our Consolidated Balance Sheets. These
transactions completed the plan approved by our Board of Directors and we have no remaining shares available for repurchase under our
stock repurchase plan.
On August 7, 2006, under a previously authorized stock repurchase plan, we repurchased 7.5 million shares of our outstanding common stock
under an accelerated share repurchase agreement with UBS Securities LLC (UBS) at an initial price of $37.52 per share for a total of $281.4
million. These shares were recorded as treasury shares in our Consolidated Balance Sheets. UBS borrowed 7.5 million of our shares from third
parties and purchased shares in the open market to settle its short position. Our repurchase was subject to a financial adjustment based on
the volume-weighted average price, less a discount, of the shares subsequently repurchased by UBS over the course of the repurchase
period. The price adjustment could have been settled, at our option, in cash or in shares of our common stock. In February 2007, the forward
purchase contract with UBS was settled for a cash payment of $20.1 million, which was recorded in equity.
In accordance with EITF Issue No. 99-7, “Accounting for an Accelerated Share Repurchase Program,” the repurchases were accounted for as
two separate transactions: (i) as shares of common stock acquired in a treasury stock transaction recorded on the acquisition date; and (ii) as a
forward contract indexed to our common stock. Additionally, we classified the forward contracts as equity under EITF Issue No. 00-19,
“Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock.”
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Dividends - Quarterly dividends paid on our common stock for shareholders of record as of the close of business on January 31, 2008, April 30,
2008, July 31, 2008, and October 31, 2008, were $0.38 per share, $0.38 per share, $0.40 per share and $0.40 per share, respectively. Additionally,
a quarterly dividend of $0.40 per share was declared in January 2009, payable in the first quarter of 2009.
Equity Units - On February 16, 2006, we successfully settled our 16.1 million equity units to 19.5 million shares of our common stock. Of this
amount, 8.3 million shares were issued from treasury stock and approximately 11.2 million shares were newly issued. Holders of the equity
units received 1.2119 shares of our common stock for each equity unit they owned. The number of shares that we issued for each stock
purchase contract was determined based on our average closing price over the 20 trading day period ending on the third trading day prior to
February 16, 2006. With the settlement, we received $402.4 million in cash, which was used to pay down our short-term bridge financing
agreement.
H. CREDIT FACILITIES AND SHORT-TERM NOTES PAYABLE
ONEOK Credit Agreement - In July 2006 and September 2008, ONEOK amended and restated its $1.2 billion credit agreement (ONEOK Credit
Agreement). The amended agreement includes revised pricing, an extension of the maturity date from 2009 to 2011, an option for additional
extensions of the maturity date with the consent of the lenders, an option to request an increase in the commitments of the lenders of up to an
additional $500 million and a change in certain sublimits. The interest rates applicable to extensions of credit under this agreement are based,
at ONEOK’s election, on either (i) the higher of prime or one-half of one percent above the Federal Funds Rate, which is the rate that banks
charge each other for the overnight borrowing of funds; or (ii) the Eurodollar rate plus a set number of basis points based on ONEOK’s current
long-term unsecured debt ratings.
Under the ONEOK Credit Agreement, ONEOK is required to comply with certain financial, operational and legal covenants. Among other
things, these requirements include:
•a $400 million sublimit for the issuance of standby letters of credit;
•a limitation on ONEOK’s stand-alone debt-to-capital ratio, which may not exceed 67.5 percent at the end of any calendar quarter;
•a requirement that ONEOK maintains the power to control the management and policies of ONEOK Partners; and
•a limit on new investments in master limited partnerships.
The ONEOK Credit Agreement also contains customary affirmative and negative covenants, including covenants relating to liens,
investments, fundamental changes in our businesses, changes in the nature of ONEOK’s businesses, transactions with affiliates, the use of
proceeds and a covenant that prevents ONEOK from restricting its subsidiaries’ ability to pay dividends.
ONEOK 364-Day Facility - In August 2008, ONEOK entered into a $400 million 364-day credit agreement (364-Day Facility). The interest rate
is based, at ONEOK’s election, on either (i) the higher of prime or one-half of one percent above the Federal Funds Rate; or (ii) the Eurodollar
rate plus a set number of basis points based on ONEOK’s current long-term unsecured debt ratings by Moody’s and S&P. The 364-Day
Facility is being used as an additional back-up to ONEOK’s commercial paper program and for working capital, capital expenditures and other
general corporate purposes. The 364-Day Facility contains substantially similar affirmative and negative covenants as the ONEOK Credit
Agreement.
The debt covenant calculations in the ONEOK Credit Agreement and the 364-Day Facility exclude the debt of ONEOK Partners. Upon breach
of any covenant by ONEOK, amounts outstanding under the ONEOK Credit Agreement or the 364-Day Facility may become immediately due
and payable. At December 31, 2008, ONEOK’s stand-alone debt-to-capital ratio was 58.2 percent and ONEOK was in compliance with all
covenants under the ONEOK Credit Agreement and the ONEOK 364-Day Facility.
At December 31, 2008, ONEOK had no commercial paper outstanding, $1.4 billion in borrowings outstanding and $64.6 million in letters of
credit issued under the ONEOK Credit Agreement, leaving $135.4 million of credit available under the ONEOK Credit Agreement and 364-Day
Facility. The ONEOK Credit Agreement and the 364-Day Facility also serve as a back-up to ONEOK’s commercial paper program.
The average interest rate on ONEOK’s short-term debt outstanding was 4.51 percent and 5.00 percent at December 31, 2008 and 2007,
respectively.
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At December 31, 2007, ONEOK had $102.6 million in commercial paper outstanding, no borrowings outstanding and $38.1 million in letters of
credit issued under the ONEOK Credit Agreement, leaving $1.1 billion of credit available under the ONEOK Credit Agreement. In addition,
ONEOK had $20.6 million in other letters of credit issued at December 31, 2007.
ONEOK Partners Credit Agreement - In March 2007, ONEOK Partners amended and restated its revolving credit facility agreement (ONEOK
Partners Credit Agreement), with several banks and other financial institutions and lenders in the following principal ways: (i) revised the
pricing; (ii) extended the maturity by one year to March 2012; (iii) eliminated the interest coverage ratio covenant; (iv) increased the permitted
ratio of indebtedness to EBITDA to 5 to 1 (from 4.75 to 1); (v) increased the swingline sub-facility commitments from $15 million to $50 million;
and (vi) changed the permitted amount of subsidiary indebtedness from $35 million to 10 percent of ONEOK Partners’ consolidated
indebtedness. The interest rates applicable to extensions of credit under this agreement are based, at ONEOK Partners’ election, on either (i)
the higher of prime or one-half of one percent above the Federal Funds Rate, which is the rate that banks charge each other for the overnight
borrowing of funds; or (ii) the Eurodollar rate plus a set number of basis points, depending on ONEOK Partners’ current long-term unsecured
debt ratings.
In July 2007, ONEOK Partners exercised the accordion feature in the ONEOK Partners Credit Agreement to increase the commitment amounts
by $250 million to a total of $1.0 billion.
Under the ONEOK Partners Credit Agreement, ONEOK Partners is required to comply with certain financial, operational and legal
covenants. Among other things, these requirements include maintaining a ratio of indebtedness to adjusted EBITDA (EBITDA plus minority
interest in income of consolidated subsidiaries, distributions received from investments and EBITDA related to any approved capital projects
less equity earnings from investments and the equity portion of AFUDC) of no more than 5 to 1. If ONEOK Partners consummates one or
more acquisitions in which the aggregate purchase price is $25 million or more, the allowable ratio of indebtedness to adjusted EBITDA will be
increased to 5.5 to 1 for the three calendar quarters following the acquisition. Upon breach of any covenant, discussed above, amounts
outstanding under the ONEOK Partners Credit Agreement may become immediately due and payable. At December 31, 2008, ONEOK
Partners’ ratio of indebtedness to adjusted EBITDA was 4.1 to 1, and ONEOK Partners was in compliance with all covenants under the
ONEOK Partners Credit Agreement.
The average interest rate of borrowings under the ONEOK Partners Credit Agreement was 4.22 percent and 5.40 percent at December 31, 2008
and 2007, respectively. ONEOK Partners had $870 million and $100 million of borrowings outstanding and $130 million and $900 million
available under the ONEOK Partners Credit Agreement at December 31, 2008 and 2007, respectively.
ONEOK Partners has an outstanding $25 million letter of credit issued by Royal Bank of Canada, which is used for counterparty credit support.
ONEOK Partners also has a $15 million Senior Unsecured Letter of Credit Facility and Reimbursement Agreement with Wells Fargo Bank, N.A.,
of which $12 million is being used, and an agreement with Royal Bank of Canada, pursuant to which a $12 million letter of credit was
issued. Both agreements are used to support various permits required by the KDHE for ONEOK Partners’ ongoing business in Kansas.
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I. LONG-TERM DEBT
The following table sets forth our long-term debt for the periods indicated. All notes are senior unsecured obligations, ranking equally in right
of payment with all of our existing and future unsecured senior indebtedness.

2008 2007
ONEOK
$402,500 at 5.51% due 2008 $ - $ 402,303
$100,000 at 6.0% due 2009 100,000 100,000
$400,000 at 7.125% due 2011 400,000 400,000
$400,000 at 5.2% due 2015 400,000 400,000
$100,000 at 6.4% due 2019 91,371 92,000
$100,000 at 6.5% due 2028 89,970 90,902
$100,000 at 6.875% due 2028 100,000 100,000
$400,000 at 6.0% due 2035 400,000 400,000
Other 2,712 2,958
1,584,053 1,988,163
ONEOK Partners
$250,000 at 8.875% due 2010 250,000 250,000
$225,000 at 7.10% due 2011 225,000 225,000
$350,000 at 5.90% due 2012 350,000 350,000
$450,000 at 6.15% due 2016 450,000 450,000
$600,000 at 6.65% due 2036 600,000 600,000
$600,000 at 6.85% due 2037 600,000 600,000
2,475,000 2,475,000
Guardian Pipeline
Average 7.85%, due 2022 121,711 133,641
Total long-term notes payable 4,180,764 4,596,804

Unamortized portion of terminated
swaps and fair value of hedged debt 55,035 43,682
Unamortized debt premium (5,023) (4,961)
Current maturities (118,195) (420,479)
Long-term debt $ 4,112,581 $ 4,215,046
The aggregate maturities of long-term debt outstanding for the years 2009 through 2013 are shown below.
ONEOK Guardian
ONEOK Partners Pipeline Total
2009 $ 106.3 $ - $ 11.9 $ 118.2
2010 $ 6.3 $ 250.0 $ 11.9 $ 268.2
2011 $ 406.3 $ 225.0 $ 11.9 $ 643.2
2012 $ 6.3 $ 350.0 $ 11.1 $ 367.4
2013 $ 6.2 $ - $ 7.7 $ 13.9
Additionally, $181.4 million of our debt is callable at par at our option from now until maturity, which is 2019 for $91.4 million and 2028 for $90.0
million. Certain debt agreements have negative covenants that relate to liens and sale/leaseback transactions.
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ONEOK Partners’ Debt Issuance - In September 2007, ONEOK Partners completed an underwritten public offering of $600 million aggregate
principal amount of 6.85 percent Senior Notes due 2037 (the 2037 Notes). The 2037 Notes were issued under ONEOK Partners’ existing shelf
registration statement filed with the SEC.
ONEOK Partners may redeem the 2037 Notes, in whole or in part, at any time prior to their maturity at a redemption price equal to the principal
amount of the 2037 Notes, plus accrued and unpaid interest and a make-whole premium. The redemption price will never be less than 100
percent of the principal amount of the 2037 Notes plus accrued and unpaid interest. The 2037 Notes are senior unsecured obligations, ranking
equally in right of payment with all of ONEOK Partners’ existing and future unsecured senior indebtedness, and effectively junior to all of the
existing debt and other liabilities of its non-guarantor subsidiaries. The 2037 Notes are non-recourse to ONEOK.
Debt Covenants - The terms of ONEOK’s long-term notes are governed by indentures containing covenants that include, among other
provisions, limitations on ONEOK’s ability to place liens on its property or assets and its ability to sell and lease back its property.
We filed a new form of indenture in 2008. The new indenture includes covenants that are similar to those contained in our prior
indentures. The new indenture does not limit the aggregate principal amount of debt securities that may be issued and provides that debt
securities may be issued from time to time in one or more additional series.
The indenture governing the 2037 Notes does not limit the aggregate principal amount of debt securities that may be issued and provides that
debt securities may be issued from time to time in one or more additional series. The indenture contains covenants including, among other
provisions, limitations on ONEOK Partners’ ability to place liens on its property or assets and its ability to sell and lease back its property.
ONEOK Partners’ $250 million and $225 million senior notes, due 2010 and 2011, respectively, contain provisions that require ONEOK Partners
to offer to repurchase the senior notes at par value if its Moody’s or S&P credit rating falls below investment grade (Baa3 for Moody’s or
BBB- for S&P) and the investment grade rating is not reinstated within a period of 40 days. Further, the indentures governing ONEOK
Partners’ senior notes due 2010 and 2011 include an event of default upon acceleration of other indebtedness of $25 million or more and the
indentures governing the senior notes due 2012, 2016, 2036 and 2037 include an event of default upon the acceleration of other indebtedness
of $100 million or more that would be triggered by such an offer to repurchase. Such an event of default would entitle the trustee or the
holders of 25 percent in aggregate principal amount of the outstanding senior notes due 2010, 2011, 2012, 2016, 2036 and 2037 to declare those
notes immediately due and payable in full.
Guardian Pipeline Senior Notes - - These notes were issued under a master shelf agreement with certain financial institutions. Principal
payments are due quarterly through 2022. Interest rates on the $121.7 million in notes outstanding at December 31, 2008, range from 7.61
percent to 8.27 percent, with an average rate of 7.85 percent. Guardian Pipeline’s senior notes contain financial covenants that require the
maintenance of a ratio of (i) EBITDAR (net income plus interest expense, income taxes, operating lease expense and depreciation and
amortization) to fixed charges (interest expense plus operating lease expense) of not less than 1.5 to 1; and (ii) total indebtedness to EBITDAR
of not greater than 5.75 to 1. Upon any breach of these covenants, all amounts outstanding under the master shelf agreement may become due
and payable immediately. At December 31, 2008, Guardian Pipeline’s EBITDAR-to-fixed-charges ratio was 4.95 to 1, the ratio of total
indebtedness to EBITDAR was 3.34 to 1, and Guardian Pipeline was in compliance with its financial covenants.
Other
We amortize premiums, discounts and expenses incurred in connection with the issuance of long-term debt consistent with the terms of the
respective debt instrument.
J. EMPLOYEE BENEFIT PLANS
Retirement and Other Postretirement Benefit Plans
Retirement Plans - We have defined benefit retirement plans covering certain full-time employees. Nonbargaining unit employees hired after
December 31, 2004, are not eligible for our defined benefit pension plan; however, they are covered by a defined contribution profit-sharing
plan. Certain officers and key employees are also eligible to participate in supplemental
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retirement plans. We generally fund pension costs at a level equal to the minimum amount required under the Employee Retirement Income
Security Act of 1974.
Other Postretirement Benefit Plans - We sponsor 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 adjusted periodically, and contains other cost-sharing features such as deductibles and coinsurance.
Statement 158 - See Note A for a discussion of the impact of the adoption of Statement 158, including the change in our measurement date
from September 30 to December 31.
Regulatory Treatment - The OCC, KCC, and regulatory authorities in Texas have approved the recovery of pension costs and other
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 are reflected in earnings.
Our regulated entities have historically recovered pension and other postretirement benefit costs, as determined by Statement 87, “Employers’
Accounting for Pensions,” and Statement 106, “Employers’ Accounting for Postretirement Benefits Other Than Pensions,” respectively,
through rates. We believe it is probable that regulators will continue to include the net periodic pension and other postretirement benefit
costs in our regulated entities’ cost of service. Accordingly, we have recorded a regulatory asset for the minimum liability associated with our
regulated entities’ pension and other postretirement benefit obligations that otherwise would have been recorded in accumulated other
comprehensive income.
Obligations and Funded Status - - The following tables set forth our pension and other postretirement benefit plans benefit obligations and
fair value of plan assets for the periods indicated. Due to the change in our measurement date as discussed in Note A, the changes in benefit
obligation and plan assets shown in the following tables are for the 15-month period from October 1, 2007 through December 31, 2008.
Pension Benefits Postretirement Benefits

2008 2007 2008 2007
Change in Benefit Obligation (Thousands of dollars)
Benefit obligation, beginning of period $ 819,999 $ 832,980 $ 294,730 $ 271,510
Service cost 25,577 21,050 7,198 6,392
Interest cost 61,649 48,608 22,206 15,830
Plan participants' contributions - - 3,299 2,882
Actuarial (gain) loss 46,967 (32,697) (21,983) 14,742
Benefits paid (66,629) (49,942) (26,685) (16,626)
Benefit obligation, end of period $ 887,563 $ 819,999 $ 278,765 $ 294,730
Change in Plan Assets

Fair value of plan assets, beginning of period $ 771,878 $ 710,377 $ 79,314 $ 68,440
Actual return on plan assets (220,955) 107,305 (17,644) 5,214
Employer contributions 117,597 4,138 12,444 14,925
Transfers in - - 3,573 -
Benefits paid (66,629) (49,942) - -
Fair value of assets, end of period $ 601,891 $ 771,878 $ 77,687 $ 88,579
Balance at December 31 $ (285,672) $ (48,121) $ (201,078) $ (206,151)
Non-current assets $ - $ 10,028 $ - $ -

Current liabilities (2,706) (2,497) - -
Non-current liabilities (282,966) (55,652) (201,078) (206,151)
Balance at December 31 $ (285,672) $ (48,121) $ (201,078) $ (206,151)
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The accumulated benefit obligation for our pension plans was $824.7 million and $759.2 million at December 31, 2008 and 2007, respectively.
There are no plan assets expected to be withdrawn and returned to us in 2009.
Components of Net Periodic Benefit Cost - The following tables set forth the components of net periodic benefit cost for our pension and
other postretirement benefit plans for the periods indicated.
Pension Benefits
2008 2007 2006
Components of Net Periodic Benefit Cost (Thousands of dollars)
Service cost $ 20,165 $ 21,050 $ 20,980
Interest cost 49,801 48,608 43,425
Expected return on plan assets (61,268) (58,154) (57,586)
Amortization of unrecognized prior service cost 1,551 1,486 1,511
Amortization of net loss 9,548 16,139 13,314
Net periodic benefit cost $ 19,797 $ 29,129 $ 21,644
Postretirement Benefits
2008 2007 2006
Components of Net Periodic Benefit Cost (Thousands of dollars)
Service cost $ 5,675 $ 6,392 $ 6,332
Interest cost 17,899 15,830 14,156
Expected return on plan assets (7,421) (6,389) (4,565)
Amortization of unrecognized net asset at adoption 3,189 3,189 3,189
Amortization of unrecognized prior service cost (2,003) (2,277) (2,286)
Amortization of net loss 10,972 9,927 9,085
Net periodic benefit cost $ 28,311 $ 26,672 $ 25,911
Other Comprehensive Income (Loss) - The following table sets forth the amounts recognized in other comprehensive income (loss) for 2008
related to our pension benefits and postretirement benefits.

Regulatory asset gain (loss) $ 252,747 $ 492
Net gain (loss) arising during the period (343,274) (1,531)
Amortization of regulatory asset (11,465) (12,911)
Amortization of transition obligation - 3,986
Amortization of prior service (cost) credit 1,941 (2,504)
Amortization of loss 11,935 13,715
Deferred income taxes 34,417 (816)
Total recognized in other comprehensive income (loss) $ (53,699) $ 431
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The table below sets forth the amounts in accumulated other comprehensive income (loss) that had not yet been recognized as components of
net periodic benefit expense.

2008 2007 2008 2007
Transition obligation $ - $ - $ (12,724) $ (16,711)
Prior service credit (cost) (6,852) (8,791) 8,384 10,888
Accumulated gain (loss) (455,089) (123,750) (113,228) (125,412)
Accumulated other comprehensive income (loss)
before regulatory assets (461,941) (132,541) (117,568) (131,235)
Regulatory asset for regulated entities 331,882 90,600 85,619 98,038
Accumulated other comprehensive income (loss)
after regulatory assets (130,059) (41,941) (31,949) (33,197)
Deferred income taxes 50,307 16,222 12,358 12,841
Accumulated other comprehensive income (loss),
net of tax $ (79,752) $ (25,719) $ (19,591) $ (20,356)
The following table sets forth the amounts recognized in either accumulated comprehensive income (loss) or regulatory assets expected to be
recognized as components of net periodic benefit expense in the next fiscal year.
Pension Postretirement
Benefits Benefits
Amounts to be recognized in 2009 (Thousands of dollars)
Transition obligation $ - $ 3,189
Prior service credit (cost) $ 1,565 $ (2,003)
Net loss $ 17,322 $ 9,660
Actuarial Assumptions - The following table sets forth the weighted-average assumptions used to determine benefit obligations for the
periods indicated.

2008 2007 2008 2007
Discount rate 6.25% 6.25% 6.25% 6.25%
Compensation increase rate 4.3% - 4.8% 3.5% - 4.5% 4.3% - 4.8% 3.5% - 4.0%
The following table sets forth the weighted-average assumptions used to determine net periodic benefit costs for the periods indicated.

2008 2007 2008 2007
Discount rate 6.25% 6.00% 6.25% 6.00%
Expected long-term return on plan assets 8.50% 8.75% 8.50% 8.75%
Compensation increase rate 3.5% - 4.5% 3.5% - 4.5% 3.5% - 4.0% 3.5% - 4.0%
We determine our overall expected long-term rate of return on plan assets assumption based on our review of historical returns and the
economic growth models from our consultants.
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Our discount rates for 2008 and 2007 are based on matching the amount and timing of the projected benefit payments to a spot-rate yield
curve, which provides zero-coupon interest rates into the future. The methodology for developing the yield curve includes selecting the
bonds to be included (only bonds rated Aa by Moody’s but excluding callable bonds, bonds with less than a minimum issue size, yield
“outliers” and various other filtering criteria to remove unsuitable bonds). Once the bonds are selected, a best-fit regression curve to the bond
data is determined, modeling yield to maturity as a function of years to maturity. This coupon yield curve is converted to a spot-yield curve
using the calculation technique that assumes the price of a coupon bond for a given maturity equals the present value of the underlying bond
cash flows using zero-coupon spot rates. Once the yield curve is developed, the projected cash flows for the plan for each year in the future
are calculated. These projected cash flows values are based on the most recent valuation. Each annual cash flow of the plan obligations is
discounted using the yield at the appropriate point on the curve, and then the single equivalent discount rate that would yield the same value
for the cash flow is determined.
Health Care Cost Trend Rates - The following table sets forth the assumed health care cost trend rates for the periods indicated.
2008 2007
Health care cost trend rate assumed for next year 5.0% - 9.0% 6.6% - 9.0%
Rate to which the cost trend rate is assumed
to decline (the ultimate trend rate) 5.0% 5.0%
Year that the rate reaches the ultimate trend rate 2018 2012
Assumed health care cost trend rates have a significant effect on the amounts reported for our health care plans. A one-percentage point
change in assumed health care cost trend rates would have the following effects.
One-Percentage One-Percentage
Point Increase Point Decrease
Effect on total of service and interest cost $ 1,989 $ (1,706)
Effect on postretirement benefit obligation $ 19,585 $ (17,171)
Plan Assets - The following table sets forth our pension and postretirement benefit plan weighted-average asset allocations as of the
measurement date.

Percentage of Plan Assets Percentage of Plan Assets
Asset Category 2008 2007 2008 2007
Corporate bonds 5% 6% 25% 14%
Insurance contracts 13% 11% - -
High yield corporate bonds 9% 10% - -
Large-cap value equities 12% 15% 14% 15%
Large-cap growth equities 14% 18% 17% 22%
Mid-cap equities 9% 13% 6% 8%
Small-cap equities 7% 11% 12% 16%
International equities 12% 16% 10% 13%
Other (a) 19% - 16% 12%
Total 100% 100% 100% 100%
(a) - Primarily money market funds
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Our investment strategy is to invest plan assets in accordance with sound investment practices that emphasize long-term fundamentals. The
goal of this strategy is to maximize investment returns while managing risk in order to meet the plan’s current and projected financial
obligations. The plan’s investments include a diverse blend of various US and international equities, investments in various classes of debt
securities, insurance contracts and venture capital. The target allocation for the assets of our pension plan is as follows.
Corporate bonds / insurance contracts 20%

High yield corporate bonds 10%
Large-cap value equities 16%
Large-cap growth equities 16%
Mid- and small-cap value equities 10%
Mid- and small-cap growth equities 10%
International equities 15%
Alternative investments 2%
Venture capital 1%
Total 100%
As part of our risk management for the plans, minimums and maximums have been set for each of the asset classes listed above. All
investment managers for the plan are subject to certain restrictions on the securities they purchase and, with the exception of indexing
purposes, are prohibited from owning our stock.
Contributions - For 2008, $113.7 million and $8.0 million of contributions were made to our pension plan and other postretirement benefit plan,
respectively. We presently anticipate our total 2009 contributions will be $31.2 million for the pension plan and $11.4 million for the other
postretirement benefit plan.
Pension and Other Postretirement Benefit Payments - Benefit payments for our pension and other postretirement benefit plans for the 15-
month period ending December 31, 2008, were $66.6 million and $26.7 million, respectively. The following table sets forth the pension benefits
and postretirement benefit payments expected to be paid in 2009-2018.

Benefits to be paid in: (Thousands of dollars)
2009 $ 52,958 $ 16,155
2010 $ 54,317 $ 17,253
2011 $ 55,882 $ 18,300
2012 $ 58,275 $ 19,238
2013 $ 60,136 $ 19,354
2014 through 2018 $ 339,437 $ 113,661
The expected benefits to be paid are based on the same assumptions used to measure our benefit obligation at December 31, 2008, and include
estimated future employee service.
Other Employee Benefit Plans
Thrift Plan - We have a Thrift Plan covering all full-time employees. Employee contributions are discretionary. We match 100 percent of
employee contributions up to 6 percent of each participant’s eligible compensation, subject to certain limits. Our contributions made to the
plan were $14.7 million, $13.2 million and $12.8 million in 2008, 2007 and 2006, respectively.
Profit-Sharing Plan - We have a profit-sharing plan for all nonbargaining unit employees hired after December 31, 2004. Nonbargaining unit
employees who were employed prior to January 1, 2005, 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 our defined benefit pension plan after December 31, 2004. We plan 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. Our contributions made to the plan were $3.2 million, $2.7 million and $1.6 million in 2008, 2007 and 2006, respectively.
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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. Our contributions made to the plan were not material in 2008, 2007 and 2006.
K. COMMITMENTS AND CONTINGENCIES
Operating Leases - In July 2007, ONEOK Leasing Company, our subsidiary, gave notice of its intent to exercise its option to purchase ONEOK
Plaza on or before the end of the current lease term set to expire on September 30, 2009. In March 2008, ONEOK Leasing Company purchased
ONEOK Plaza for a total purchase price of approximately $48 million, which included $17.1 million for the present value of the remaining lease
payments and $30.9 million for the base purchase price.
We lease excess office space in ONEOK Plaza. We received rental revenue of $2.6 million in 2008 and $2.9 million in 2007 and 2006. Estimated
minimum future rental payments to be received under existing contracts for subleases are $1.9 million in 2009, $0.8 million in 2010 and $0.7
million in 2011.
Future minimum lease payments under non-cancelable operating leases on a gas processing plant, storage contracts, office space, pipeline
equipment, rights-of-way and vehicles are shown in the table below.
ONEOK ONEOK Partners Total

2009 $ 88.8 $ 18.4 $ 107.2
2010 $ 55.9 $ 16.0 $ 71.9
2011 $ 61.2 $ 15.5 $ 76.7
2012 $ 32.9 $ 8.8 $ 41.7
2013 $ 25.4 $ 2.1 $ 27.5
The amounts in the ONEOK column above include the following minimum lease payments relating to the lease of a gas processing plant for
$24.0 million in 2009, $24.2 million in 2010, and $30.6 million in 2011. We acquired the lease in a business combination and recorded a liability
for uneconomic lease terms. The liability is accreted to rent expense in the amount of $13.0 million per year over the term of the lease; however,
the cash outflow under the lease remains the same. The amounts in the ONEOK Partners column above exclude intercompany payments
relating to the lease of a gas processing plant.
Environmental Liabilities - We are subject to multiple environmental, historical and wildlife preservation laws and regulations affecting many
aspects of our present and future operations. Regulated activities include those involving air emissions, stormwater and wastewater
discharges, handling and disposal of solid and hazardous wastes, hazardous materials transportation, and pipeline and facility
construction. These laws and regulations require us to obtain and comply with a wide variety of environmental clearances, registrations,
licenses, permits and other approvals. Failure to comply with these laws, regulations, permits and licenses may expose us to fines, penalties
and/or interruptions in our operations that could be material to our results of operations. If a leak or spill of hazardous substances or
petroleum products occurs from our lines or facilities, in the process of transporting natural gas, NGLs, or refined products, or at any facility
that we own, operate or otherwise use, we could be held jointly and severally liable for all resulting liabilities, including investigation and
clean-up costs, which could materially affect our results of operations and cash flows. In addition, emission controls required under the
federal Clean Air Act and other similar federal and state laws could require unexpected capital expenditures at our facilities. We cannot assure
that existing environmental 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, particularly if those costs are not fully
recoverable from customers, could have a material adverse effect on our business, financial condition and results of operations.
We own or retain legal responsibility for the environmental conditions at 12 former manufactured 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 presently 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
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risk analysis. Remediation typically involves the management of contaminated soils and may involve removal of structures and monitoring
and/or remediation of groundwater.
Of the 12 sites, we have commenced soil remediation on 11 sites. Regulatory closure has been achieved at two locations, and we have
completed or are near completion of soil remediation at nine sites. We have begun site assessment at the remaining site where no active
remediation has occurred.
To date, we have incurred remediation costs of $7.8 million and have accrued an additional $4.2 million related to the sites where soil
remediation has yet to be completed. These estimates are recorded on an undiscounted basis. For the site that is currently in the assessment
phase, we have completed some analysis but are unable at this point to accurately estimate aggregate costs that may be required to satisfy our
remedial obligations at this site. Until the site assessment is complete and the KDHE approves the remediation plan, we will not have complete
information available to us to accurately estimate remediation costs.
The costs associated with these sites do not include other potential expenses that might be incurred, such as ongoing and additional water
monitoring and remediation, unasserted property damage claims, personal injury or natural resource claims, unbudgeted legal expenses or
other costs for which we may be held liable but with respect to which we cannot reasonably estimate an amount. As of this date, we have no
knowledge of any of these types of claims. The foregoing estimates do not consider potential insurance recoveries, recoveries through rates
or recoveries from unaffiliated parties, to which we may be entitled. We have filed claims with our insurance carriers relating to these sites, and
we have recovered a portion of our costs incurred to date. We have not recorded any amounts for potential insurance recoveries or recoveries
from unaffiliated parties, and we are not recovering any environmental amounts in rates. As more information related to the site investigations
and remediation activities becomes available, and to the extent such amounts are expected to exceed our current estimates, additional expenses
could be recorded. Such amounts could be material to our results of operations and cash flows depending on the remediation and number of
years over which the remediation is required to be completed.
Our expenditures for environmental evaluation, mitigation and remediation to date have not been significant in relation to our results of
operations, and there were no material effects upon earnings during 2008, 2007 or 2006 related to compliance with environmental regulations.
Legal Proceedings - We are a party to various litigation matters and claims that are in the normal course of our operations. While the results
of litigation and claims cannot be predicted with certainty, we believe the final outcome of such matters will not have a material adverse effect
on our consolidated results of operations, financial position or liquidity.
FERC Matter - As a result of a transaction that was brought to the attention of one of our affiliates by a third party, we conducted an internal
review of transactions that may have violated FERC natural gas capacity release rules or related rules and determined that there were
transactions that should be disclosed to the FERC. We notified the FERC of this review and filed a report with the FERC regarding these
transactions in March 2008. We cooperated fully with the FERC in its investigation of this matter and have taken steps to better ensure that
current and future transactions comply with applicable FERC regulations by implementing a compliance plan dealing with capacity
release. We entered into a global settlement with the FERC to resolve this matter and other FERC enforcement matters, which was approved
by the FERC on January 15, 2009. The global settlement provides for a total civil penalty of $4.5 million and approximately $2.2 million in
disgorgement of profits and interest, of which $1.7 million of the civil penalty was allocated to ONEOK Partners. The amounts were recorded
as a liability on our Consolidated Balance Sheet as of December 31, 2008. We made the required payments in January 2009.
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L. INCOME TAXES
The following table sets forth our provisions for income taxes for the periods indicated.

2008 2007 2006
Current income taxes (Thousands of dollars)
Federal $ 18,833 $ 100,517 $ 69,698
State 10,047 19,063 10,312
Total current income taxes from continuing operations 28,880 119,580 80,010
Deferred income taxes
Federal 143,807 56,887 96,464
State 21,384 8,130 17,290
Total deferred income taxes from continuing operations 165,191 65,017 113,754
Total provision for income taxes before discontinued operations 194,071 184,597 193,764
Discontinued operations - - (232)
Total provision for income taxes $ 194,071 $ 184,597 $ 193,532
The following table is a reconciliation of our income tax expense for the periods indicated.

2008 2007 2006
Pretax income from continuing operations $ 505,980 $ 489,518 $ 500,441
Federal statutory income tax rate 35% 35% 35%
Provision for federal income taxes 177,093 171,331 175,154
Amortization of distribution property investment tax credit (455) (505) (525)
State income taxes, net of federal tax benefit 20,431 17,676 18,809
Other, net (2,998) (3,905) 326
Income tax expense $ 194,071 $ 184,597 $ 193,764
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,
2008 2007
Deferred tax assets (Thousands of dollars)
Employee benefits and other accrued liabilities $ 161,947 $ 134,056
Net operating loss carryforward 4,226 4,715
Other comprehensive income 43,747 -
Other 23,051 27,374
Total deferred tax assets 232,971 166,145
Deferred tax liabilities

Excess of tax over book depreciation and depletion 372,123 344,601
Purchased gas adjustment 20,047 9,015
Investment in joint ventures 564,234 490,093
Regulatory assets 180,037 115,689
Other comprehensive income - 1,567
Other 746 2,720
Total deferred tax liabilities 1,137,187 963,685
Net deferred tax liabilities $ 904,216 $ 797,540
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At December 31, 2008, ONEOK Partners had approximately $4.2 million of tax benefits available related to net operating loss carryforwards,
which will expire between the years 2022 and 2027. We believe that it is more likely than not that the tax benefits of the net operating loss
carryforwards will be utilized prior to their expiration; therefore, no valuation allowance is necessary.
We had income taxes receivable of approximately $77.1 million and $13.2 million at December 31, 2008 and 2007, respectively.
M. SEGMENTS
Segment Descriptions - We have divided our operations into four reportable business segments based on similarities in economic
characteristics, products and services, types of customers, methods of distribution and regulatory environment. These segments are as
follows: (i) our ONEOK Partners segment gathers, processes, transports, stores and sells natural gas and gathers, treats, fractionates, stores,
distributes and markets NGLs; (ii) our Distribution segment delivers natural gas to residential, commercial and industrial customers, and
transports natural gas; (iii) our Energy Services segment markets natural gas to wholesale and retail customers; and (iv) our Other segment
primarily consists of the operating and leasing operations of our headquarters building and a related parking facility. Our Distribution segment
is comprised of regulated public utilities, and portions of our ONEOK Partners segment are also regulated.
Accounting Policies - The accounting policies of the segments are described in Note A. Intersegment sales are recorded on the same basis as
sales to unaffiliated customers. Overhead costs relating to a reportable segment have been allocated for the purpose of calculating operating
income.
Customers - The primary customers for our ONEOK Partners segment include major and independent oil and gas production companies,
natural gas gathering and processing companies, petrochemical, refining and NGL marketing companies, LDCs, power generating companies,
natural gas marketing companies, NGL gathering companies and propane distributors. Our Distribution segment provides natural gas to
residential, commercial, industrial, wholesale, public authority and transportation customers. Our Energy Services segment buys natural gas
from producers and other marketing companies and sells natural gas to LDCs, municipalities, producers, large industrials, power generators,
retail aggregators and other marketing companies, as well as residential and small commercial/industrial companies.
In 2008, 2007 and 2006, we had no single external customer from which we received 10 percent or more of our consolidated gross revenues.
Operating Segment Information - - The following tables set forth certain selected financial information for our operating segments for the
periods indicated.
ONEOK Energy Other and

Year Ended December 31, 2008 Partners (a) Distribution (b) Services Eliminations Total
Sales to unaffiliated customers $ 6,975,320 $ 2,177,615 $ 7,001,296 $ 3,202 $ 16,157,433
Intersegment revenues 744,886 7 584,507 (1,329,400) -
Total revenues $ 7,720,206 $ 2,177,622 $ 7,585,803 $ (1,326,198) $ 16,157,433
Net margin $ 1,140,659 $ 680,971 $ 110,716 $ 3,181 $ 1,935,527

Operating costs 371,797 375,328 35,593 (5,806) 776,912
Depreciation and amortization 124,765 116,782 921 1,459 243,927
Gain or (loss) on sale of assets 713 (21) 1,500 124 2,316
Operating income $ 644,810 $ 188,840 $ 75,702 $ 7,652 $ 917,004
Equity earnings from

investments $ 101,432 $ - $ - $ - $ 101,432
Investments in unconsolidated
affiliates $ 755,492 $ - $ - $ - $ 755,492
Minority interests in
consolidated subsidiaries $ 5,941 $ - $ - $ 1,073,428 $ 1,079,369
Total assets $ 7,254,272 $ 3,063,374 $ 1,752,256 $ 1,056,160 $ 13,126,062
Capital expenditures $ 1,253,853 $ 169,049 $ 62 $ 50,172 $ 1,473,136
(a) - Our ONEOK Partners segment has regulated and non-regulated operations. Our ONEOK Partners segment's regulated operations had
revenues of $439.3 million, net margin of $334.1 million and operating income of $158.8 million.
(b) - All of our Distribution segment's operations are regulated.
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Sales to unaffiliated customers $ 5,204,794 $ 2,099,056 $ 6,170,084 $ 3,480 $ 13,477,414
Total revenues $ 5,831,558 $ 2,099,063 $ 6,629,403 $ (1,082,610) $ 13,477,414
Net margin $ 895,893 $ 663,648 $ 247,402 $ 3,165 $ 1,810,108

Operating costs 337,356 377,778 39,920 6,456 761,510
Depreciation and amortization 113,704 111,615 2,147 498 227,964
Gain or (loss) on sale of assets 1,950 (56) - 15 1,909
Operating income $ 446,783 $ 174,199 $ 205,335 $ (3,774) $ 822,543

investments $ 89,908 $ - $ - $ - $ 89,908
affiliates $ 756,260 $ - $ - $ - $ 756,260
consolidated subsidiaries $ 5,802 $ - $ - $ 796,162 $ 801,964
Total assets $ 6,112,065 $ 3,045,249 $ 1,549,012 $ 355,708 $ 11,062,034
Capital expenditures $ 709,858 $ 162,044 $ 158 $ 11,643 $ 883,703
revenues of $344.3 million, net margin of $273.7 million and operating income of $122.4 million.

Sales to unaffiliated customers $ 4,142,546 $ 1,958,192 $ 5,846,258 $ (26,670) $ 11,920,326
Total revenues $ 4,738,248 $ 1,958,199 $ 6,335,807 $ (1,111,928) $ 11,920,326
Net margin $ 843,548 $ 599,797 $ 273,818 $ 4,821 $ 1,721,984

Operating costs 325,774 371,460 42,464 1,069 740,767
Depreciation and amortization 122,045 110,858 2,149 491 235,543
Gain on sale of assets 115,483 18 - 1,027 116,528
Operating income $ 511,212 $ 117,497 $ 229,205 $ 4,288 $ 862,202

investments $ 95,883 $ - $ - $ - $ 95,883
affiliates $ 748,879 $ - $ - $ - $ 748,879
consolidated subsidiaries $ 5,606 $ - $ - $ 795,039 $ 800,645
Total assets $ 4,921,717 $ 2,940,514 $ 2,023,663 $ 505,188 $ 10,391,082
Capital expenditures $ 201,746 $ 159,026 $ - $ 15,534 $ 376,306
revenues of $335.9 million, net margin of $261.8 million and operating income of $240.1 million, including $113.9 million from a gain on sale of
assets, for the year ended December 31, 2006.
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N. STOCK-BASED COMPENSATION
Equity Compensation Plan
The ONEOK, Inc. Equity Compensation Plan provides for the granting of stock-based compensation, including incentive stock options, non-
statutory stock options, stock bonus awards, restricted stock awards, restricted stock unit awards, performance stock awards and performance
unit awards to eligible employees and the granting of stock awards to non-employee directors. We have reserved a total of approximately 5.0
million shares of common stock for issuance under the plan. In December 2008, we amended the Equity Compensation Plan to allow for the
deferral of awards granted in stock or cash, in accordance with Internal Revenue Code section 409A requirements. This deferral option is
applicable for certain awards granted in 2006 and later, and vesting after 2008.
Restricted Stock Incentive Units - Restricted stock incentive units may be granted to key employees with ownership of the common stock
underlying the incentive unit vesting over a period determined by the Committee. Awards granted to date vest over a three-year
period. Awards granted in 2008, 2007 and 2006 entitle the grantee to receive shares of our common stock. Awards granted in 2005 entitled the
grantee to receive two-thirds of the grant in our common stock (equity awards) and one-third of the grant in cash (liability awards). The equity
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. The portion of the grants that are settled in cash are classified as liability awards with fair value based on the fair
market value of our common stock, reduced by expected dividend payments and adjusted for estimated forfeitures, at each reporting date. No
dividends are paid on the restricted stock incentive units. Compensation expense is recognized on a straight-line basis over the vesting period
of the award.
Performance Unit Awards - Performance unit awards may be granted to key employees. The shares of our common stock underlying the
performance units vest at the expiration of a period determined by the Committee if certain performance criteria are met by us. Performance
units granted to date vest at the expiration of a three-year period. Upon vesting, a holder of performance units is entitled to receive a number
of shares of our common stock equal to a percentage (0 percent to 200 percent) of the performance units granted based on our 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 performance unit awards granted in 2008, 2007 and 2006 entitle the grantee to receive the grant in shares of our common
stock. Under Statement 123R, our 2008, 2007 and 2006 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. The compensation expense on these awards will only be adjusted for changes in forfeitures.
The performance unit awards granted in 2005 entitled the grantee to receive two-thirds of the grant in shares of our common stock (equity
awards) and one-third of the grant in cash (liability awards). The fair values of these performance units that were classified as equity awards
were calculated as of the date of grant were not adjusted upon adoption of Statement 123R. The fair values of the one-third liability portion of
the performance units were estimated at each reporting date based on a Monte Carlo model.
Long-Term Incentive Plan
The ONEOK, Inc. Long-Term Incentive Plan (the LTIP) provides for the granting of stock awards similar to those described above with respect
to the Equity Compensation Plan. We have reserved a total of approximately 7.8 million shares of common stock for issuance under the
plan. The maximum number of shares for which options or other awards may be granted to any employee during any year is 300,000.
Options - Stock options may be granted that are not exercisable until a fixed future date or in installments. Options issued to date become void
upon voluntary termination of employment other than retirement. In the event of retirement or involuntary termination, the optionee may
exercise the option within a period determined by the Executive Compensation Committee (the Committee) and stated in the option. In the
event of death, the option may be exercised by the personal representative of the optionee within a period to be determined by the Committee
and stated in the option. A portion of the options issued to date
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can be exercised after one year from grant date and an option must be exercised no later than 10 years after grant date. Effective January 1,
2007, we eliminated the restored option feature for outstanding stock option grants.
Stock Compensation Plan for Non-Employee Directors
The ONEOK, Inc. Stock Compensation Plan for Non-Employee Directors (the DSCP) provides for the granting of stock options, stock bonus
awards, including performance unit awards, restricted stock awards and restricted stock unit awards. Under the DSCP, these awards may be
granted by the Committee at any time, until grants have been made for all shares authorized under the DSCP. We have reserved a total of
700,000 shares of common stock for issuance under the DSCP. The maximum number of shares of common stock which can be issued to a
participant under the DSCP during any year is 20,000. No performance unit awards or restricted stock awards have been made to non-
employee directors under the DSCP.
Options - Options may be granted to non-employee directors on the same terms as those granted under the LTIP.
General
Effective January 1, 2006, we adopted Statement 123R. See Note A for additional information. For all awards outstanding, we used a forfeiture
rate ranging from zero percent to 13 percent based on historical forfeitures under our share-based payment plans. We use a combination of
issuances from treasury stock and repurchases in the open market to satisfy our share-based payment obligations.
Compensation cost expensed for our share-based payment plans described below was $13.1 million, $12.0 million and $17.6 million 2008, 2007
and 2006, respectively, which is net of $8.3 million, $7.5 million and $11.2 million of tax benefits, respectively. No compensation cost was
capitalized for 2008, 2007 and 2006.
Cash received from the exercise of awards under all share-based payment arrangements was $3.8 million and $7.4 million for 2008 and 2007,
respectively. The actual tax benefit realized for the anticipated tax deductions of the exercise of share-based payment arrangements totaled
$1.4 million and $4.6 million for 2008 and 2007, respectively. No cash was used to settle the equity portion of the restricted stock unit and
performance unit awards granted under share-based payment arrangements.
Stock Option Activity
The following table sets forth the stock option activity for employees and non-employee directors for the periods indicated.
Number of Weighted
Shares Average Price
Outstanding December 31, 2007 953,146 $ 24.69
Exercised (176,215) $ 25.72
Expired (2,625) $ 28.69
Outstanding December 31, 2008 774,306 $ 24.44
Exercisable December 31, 2008 774,306 $ 24.44
The aggregate intrinsic value in the table below represents the total pre-tax intrinsic value, based on our year-end closing stock price of $29.12,
that would have been received by the option holders had all option holders exercised their options as of December 31, 2008.
Stock Options Outstanding and Exercisable

Weighted Aggregate
Average Weighted Intrinsic
Range of Number Remaining Average Value
of
Exercise Prices Awards Life (yrs) Exercise Price (in 000's)
$14.58 to $21.87 376,485 3.04 $ 16.98 $ 4,571
$21.88 to $32.82 179,666 1.86 $ 24.69 $ 796
$32.83 to $43.67 218,155 2.15 $ 37.11 $ -
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The fair value of each restored option was estimated on the date of grant using the Black-Scholes model and the assumptions in the table
below.
December 31, 2006

Volatility (a) 15.43% to 25.23%
Dividend Yield 3.24% to 4.00%
Risk-free Interest Rate 4.39% to 5.18%
(a) - Volatility was based on historical volatility over twelve months
using daily stock price observations.
The weighted-average period of outstanding options is 2.5 years. As of December 31, 2008, all stock options were fully vested and
expensed. The following table sets forth various statistics relating to our stock option activity.
December 31, December 31, December 31,

2008 2007 2006
Weighted-average grant date fair value of options restored (per share) (a) (a) $ 5.57
Intrinsic value of options exercised (thousands of dollars) $ 3,652 $ 12,129 $ 10,246
Fair value of options granted (thousands of dollars) (a) (a) $ 1,990
(a) - Due to our elimination of the restored option feature effective January 1, 2007, no grants were restored in 2007 or 2008.
Restricted Stock Unit Activity
The total fair value of shares vested during 2008 was $5.9 million. As of December 31, 2008, there was $5.5 million of total unrecognized
compensation cost related to our nonvested restricted stock unit awards, which is expected to be recognized over a weighted-average period
of 1.5 years. The following tables set forth activity and various statistics for the equity portion of the restricted stock unit awards.
Number of Weighted
Nonvested December 31, 2007 461,627 $ 31.56
Granted 53,550 $ 47.44
Released to participants (86,076) $ 25.34
Forfeited (1,969) $ 38.16

2008 2007 2006
Weighted-average grant date fair value (per share) $ 43.22 $ 36.82 $ 25.98
Fair value of shares granted (thousands of dollars) $ 2,314 $ 9,733 $ 3,761
The following table sets forth activity for the liability portion of the restricted stock unit awards.
Number of Weighted
Released to participants (40,583) $ 25.19
Forfeited - $ -
Nonvested December 31, 2008 - $ -
Performance Unit Activity
The total fair value of shares vested during 2008 was $14.9 million. As of December 31, 2008, there was $14.5 million of total unrecognized
compensation cost related to the nonvested performance unit awards, which is expected to be recognized
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over a weighted-average period of 1.1 years. The following tables set forth activity and various statistics related to the performance unit
equity awards and the assumptions used in the valuations of the 2008, 2007 and 2006 grants at the grant date.
Number of Weighted
Units Average Price
Granted 387,125 $ 47.44
Released to participants (a) (211,517) $ 25.48
Forfeited (20,975) $ 38.32
Nonvested December 31, 2008 1,091,549 $ 36.58
(a) - Performance awards granted in 2005 and released in 2008 were adjusted with
a 150 percent performance factor; for the equity awards, this resulted in an
additional 105,760 shares released to participants.
2008 2007 2006

Volatility (a) 22.50% 20.30% 18.80%
Dividend Yield 3.20% 3.79% 3.70%
Risk-free Interest Rate 2.46% 4.80% 4.32%
(a) - Volatility was based on historical volatility over three years using daily stock price observations.

2008 2007 2006
Weighted-average grant date fair value (per share) $ 43.88 $ 37.58 $ 25.98
Fair value of shares granted (thousands of dollars) $ 16,987 $ 12,366 $ 12,444
The following tables set forth activity for the performance unit liability awards and the assumptions used in the valuations at the end of each
period indicated.
Number of Weighted
Units Average Price
Released to participants (a) (105,758) $ 25.48
Forfeited (381) $ 26.57
Nonvested December 31, 2008 - $ -
(a) - Performance awards granted in 2005 and released in 2008 were adjusted with
a 150 percent performance factor; for the liability awards, this resulted in an
additional 52,880 liability units released to participants.
2008 2007 2006

Volatility (a) (b) 21.80% 20.30%
Dividend Yield (b) 3.05% 3.62%
Risk-free Interest Rate (b) 3.07% 4.74%
(a) - Volatility was based on historical volatility over three years using daily stock price observations.
(b) - Nonvested balance at December 31, 2008 was zero.
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Employee Stock Purchase Plan
We have reserved a total of 4.8 million shares of common stock for issuance under our ONEOK, Inc. Employee Stock Purchase Plan (the
ESPP). Subject to certain exclusions, all full-time 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 our common stock, subject to terms and limitations of the plan. The 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 its grant date or exercise date market
price. Approximately 52 percent, 59 percent and 63 percent of employees participated in the plan in 2008, 2007 and 2006, respectively. Under
the plan, we sold 297,864 shares at $24.41 in 2008, 217,369 shares at $36.85 per share in 2007, and 340,364 shares at $22.57 per share in 2006.
Employee Stock Award Program
Under our Employee Stock Award Program, we issued, for no consideration, to all eligible employees (all full-time employees and employees
on short-term disability) one share of our common stock when the per-share closing price of our common stock on the NYSE was for the first
time at or above $26 per share, and we have issued and will continue to issue, for no consideration, one additional share of our common stock
to all eligible employees when the closing price on the NYSE is for the first time at or above each one dollar increment above $26 per
share. We have reserved a total of 300,000 shares of common stock for issuance under this program.
There were no shares issued to employees under this program in 2008. Shares issued to employees under this program totaled 44,099 and
40,705 for the years ended December 31, 2007 and 2006, respectively. Compensation expense related to the Employee Stock Award Plan was
$2.2 million and $1.6 million in 2007 and 2006, respectively.
Deferred Compensation Plan for Non-Employee Directors
The ONEOK, Inc. Nonqualified Deferred Compensation Plan for Non-Employee Directors provides our directors, who are not our employees,
the option to defer all or a portion of their compensation for their service on our Board of Directors. Under the plan, directors may elect either
a cash deferral option or a phantom stock option. Under the cash deferral option, directors may defer the receipt of all or a portion of their
annual retainer and/or meeting fees, plus accrued interest. Under the phantom stock option, directors may defer all or a portion of their annual
retainer and/or meeting fees and receive such fees on a deferred basis in the form of shares of common stock under our Long-Term Incentive
Plan or Equity Compensation Plan. Shares are distributed to non-employee directors at the fair market value of our common stock at the date
of distribution. In December 2008, we amended the Deferred Compensation Plan for Non-Employee Directors in accordance with Internal
Revenue Code section 409A requirements.
O. UNCONSOLIDATED AFFILIATES
Investments in Unconsolidated Affiliates - The following table sets forth our investments in unconsolidated affiliates for the periods indicated.
Net
December December
Ownership 31, 31,
Interest 2008 2007
Northern Border Pipeline 50 % $ 392,601 $ 418,982
Bighorn Gas Gathering, L.L.C. 49 % 97,289 97,716
Fort Union Gas Gathering 37 % 108,642 85,197
Lost Creek Gathering Company, L.L.C. (a) 35 % 77,773 75,612
Other Various 79,187 78,753
Investments in unconsolidated affiliates $ 755,492 (b) $ 756,260 (b)
(a) - ONEOK Partners is entitled to receive an incentive allocation of earnings from third-party gathering services revenue recognized by Lost
Creek Gathering Company, L.L.C. As a result of the incentive, ONEOK Partners’ share of Lost Creek Gathering Company, L.L.C.'s income
exceeds its 35 percent ownership interest.
(b) - Equity method goodwill (Note E) was $185.6 million at December 31, 2008 and 2007.
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Equity Earnings from Investments - The following table sets forth our equity earnings from investments for the periods indicated. All
amounts in the table below are equity earnings from investments in our ONEOK Partners segment.

2008 2007 2006
Northern Border Pipeline (a) $ 65,912 $ 62,008 $ 72,393
Bighorn Gas Gathering, L.L.C. 8,195 7,416 8,223
Fort Union Gas Gathering 14,172 9,681 9,030
Lost Creek Gathering Company, L.L.C. 5,365 4,790 5,363
Other 7,788 6,013 874
Equity Earnings From Investments $ 101,432 $ 89,908 $ 95,883
(a) - For the first three months of 2006, ONEOK Partners included 70 percent of Northern Border Pipeline’s income in equity earnings from
investments. After the sale of a 20 percent interest in Northern Border Pipeline in April 2006, ONEOK Partners included 50 percent of
Northern Border Pipeline’s income in equity earnings from investments (Note B).
Unconsolidated Affiliates Financial Information - Summarized combined financial information of our unconsolidated affiliates is presented
below.
December 31,
2008 2007
Balance Sheet
Current assets $ 106,833 $ 102,805
Property, plant and equipment, net $ 1,777,350 $ 1,724,330
Other noncurrent assets $ 27,547 $ 25,882
Current liabilities $ 279,996 $ 79,593
Long-term debt $ 543,894 $ 717,301
Other noncurrent liabilities $ 14,360 $ 10,278
Accumulated other comprehensive income (loss) $ (5,708) $ (2,441)
Owners' equity $ 1,079,188 $ 1,048,286

2008 2007 2006
Income Statement
Operating revenue $ 415,552 $ 404,399 $ 386,448
Operating expenses $ 179,380 $ 172,997 $ 159,452
Net income $ 209,915 $ 184,434 $ 183,732
Distributions paid to us $ 118,010 $ 103,785 $ 123,427
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P. EARNINGS PER SHARE INFORMATION
The following table sets forth the computation of basic and diluted EPS from continuing operations for the periods indicated.
Year Ended December 31, 2008

Per Share
Income Shares Amount
Basic EPS from continuing operations (Thousands, except per share amounts)
Income from continuing operations available for common stock $ 311,909 104,369 $ 2.99
Diluted EPS from continuing operations
Effect of dilutive securities:
Options and other dilutive securities - 1,391
Income from continuing operations available for common stock
and common stock equivalents $ 311,909 105,760 $ 2.95

Per Share
Effect of other dilutive securities:

Per Share
Effect of other dilutive securities:
Mandatory convertible units - 629
There were 64,989, 4,601 and 66,463 option shares excluded from the calculation of diluted EPS for 2008, 2007 and 2006, respectively, since their
inclusion would be anti-dilutive.
Q. ONEOK PARTNERS
Ownership Interest in ONEOK Partners - See Note B for discussion of the acquisition of the additional general partner interest in ONEOK
Partners.
In April 2006, we received newly created Class B limited partner units from ONEOK Partners. As of April 7, 2007, the Class B limited partner
units are no longer subordinated to distributions on ONEOK Partners’ common units and generally have the same voting rights as the
common units and are entitled to receive increased quarterly distributions and distributions on liquidation equal to 110 percent of the
distributions paid with respect to the common units. On June 21, 2007, we, as the sole holder of ONEOK Partners Class B limited partner units,
waived our right to receive the increased quarterly distributions on the Class B units for the period April 7, 2007, through December 31, 2007,
and continuing thereafter until we give
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ONEOK Partners no less than 90 days advance notice that we have withdrawn our waiver. Any such withdrawal of the waiver will be effective
with respect to any distribution on the Class B units declared or paid on or after 90 days following delivery of the notice.
Under the ONEOK Partners’ partnership agreement and in conjunction with the issuance of additional common units by ONEOK Partners, we,
as the general partner, are required to make equity contributions in order to maintain our representative general partner interest.
Our ownership interest in ONEOK Partners is shown in the table below for the periods presented.

2008 2007 2006
General partner interest 2.00% 2.00% 2.00%
Limited partner interest 45.70% (a) 43.70%(b) 43.70%(b)
Total ownership interest 47.70% 45.70% 45.70%
(a) - Represents 5.9 million common units and approximately 36.5 million Class B units, which are convertible, at our option, into common units.
(b) - Represents 0.5 million common units and approximately 36.5 million Class B units, which are convertible, at our option, into common units.
In March 2008, we purchased from ONEOK Partners, in a private placement, an additional 5.4 million of ONEOK Partners’ common units for a
total purchase price of approximately $303.2 million. In addition, ONEOK Partners completed a public offering of 2.5 million common units at
$58.10 per common unit and received net proceeds of $140.4 million after deducting underwriting discounts but before offering expenses. In
conjunction with ONEOK Partners’ private placement and public offering of common units, ONEOK Partners GP contributed $9.4 million to
ONEOK Partners in order to maintain its 2 percent general partner interest. We and ONEOK Partners GP funded these amounts with available
cash and short-term borrowings.
upon their partial exercise of their option to purchase additional common units to cover over-allotments. ONEOK Partners received net
order to maintain its 2 percent general partner interest.
Cash Distributions - Under the ONEOK Partners’ partnership agreement, distributions are made to the partners with respect to each calendar
quarter in an amount equal to 100 percent of available cash. Available cash generally consists of all cash receipts adjusted for cash
disbursements and net changes to cash reserves. Available cash will generally be distributed 98 percent to limited partners and 2 percent to
the general partner. The general partner’s percentage interest in quarterly distributions is increased after certain specified target levels are
met. Under the incentive distribution provisions, the general partner receives:
•15 percent of amounts distributed in excess of $0.605 per unit;
•25 percent of amounts distributed in excess of $0.715 per unit; and
•50 percent of amounts distributed in excess of $0.935 per unit.
ONEOK Partners’ income is allocated to the general and limited partners in accordance with their respective partnership ownership
percentages. The effect of any incremental income allocations for incentive distributions that are allocated to the general partner is calculated
after the income allocation for the general partner’s partnership interest and before the income allocation to the limited partners.
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The following table shows ONEOK Partners’ general partner and incentive distributions related to the periods indicated.

2008 2007 2006
General partner distributions $ 9,456 $ 7,842 $ 6,228
Incentive distributions 76,042 50,627 31,102
Total distributions to general partner $ 85,498 $ 58,469 $ 37,330
The quarterly distributions paid by ONEOK Partners to limited partners in the first, second, third and fourth quarters of 2008 were $1.025 per
unit, $1.04 per unit, $1.06 per unit, and $1.08 per unit, respectively.
In January 2009, ONEOK Partners declared a cash distribution of $1.08 per unit payable in the first quarter. On February 13, 2009, we received
the related incentive distribution of $20.3 million for the fourth quarter of 2008, which is included in the table above.
Relationship - We own 47.7 percent of ONEOK Partners and consolidate ONEOK Partners in our consolidated financial statements; however,
we are restricted from the assets and cash flows from ONEOK Partners except for our distributions. Distributions are declared quarterly by
ONEOK Partners’ general partner based on the terms of its partnership agreement. For the years ended December 31, 2008, 2007 and 2006,
cash distributions declared from ONEOK Partners to us totaled $266.1 million, $207.4 million and $145.1 million, respectively. See Note M for
more information on ONEOK Partners results.
Affiliate Transactions - We have certain transactions with our ONEOK Partners affiliate and its subsidiaries, which comprise our ONEOK
Partners segment.
ONEOK Partners sells natural gas from its natural gas gathering and processing operations to our Energy Services segment. In addition, a
large portion of ONEOK Partners’ revenues from its natural gas pipelines businesses are from our Energy Services and Distribution segments,
which utilize ONEOK Partners’ natural gas transportation and storage services. ONEOK Partners also purchases natural gas from our Energy
Services segment for its natural gas liquids operations and its gathering and processing operations.
ONEOK Partners has certain contractual rights to the Bushton Plant through a Processing and Services Agreement with us, which sets out the
terms for processing and related services we provide at the Bushton Plant through 2012. ONEOK Partners has contracted for all of the
capacity of the Bushton Plant from OBPI. In exchange, ONEOK Partners pays us for all direct costs and expenses of the Bushton Plant,
including reimbursement of a portion of our obligations under equipment leases covering the Bushton Plant.
We provide a variety of services to our affiliates, including cash management and financial services, employee benefits provided through our
benefit plans, administrative services provided by our employees and management, insurance and office space leased in our headquarters
building and other field locations. Where costs are specifically incurred on behalf of an affiliate, the costs are billed directly to the affiliate by
us. In other situations, the costs may be allocated to the affiliates through a variety of methods, depending upon the nature of the expenses
and the activities of the affiliates. For example, a service that applies equally to all employees is allocated based upon the number of
employees in each affiliate. However, an expense benefiting the consolidated 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, earnings before interest and
taxes and payroll expense.
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The following table shows transactions with ONEOK Partners for the periods shown.

2008 2007 2006
Revenues $ 744,886 $ 626,764 $ 595,702
Expenses
Cost of sales and fuel $ 107,983 $ 89,792 $ 177,367
Administrative and general expenses 191,798 171,741 175,270
Interest expense - - 21,372
Total expenses $ 299,781 $ 261,533 $ 374,009
See “Ownership Interest in ONEOK Partners” above for additional discussion of our purchase of common units and ONEOK Partners GP’s
additional general partner contributions in March and April 2008.
R. QUARTERLY FINANCIAL DATA (UNAUDITED)
First Second Third Fourth

Year Ended December 31, 2008 Quarter Quarter Quarter Quarter
Total Revenues $ 4,902,076 $ 4,172,866 $ 4,239,246 $ 2,843,245
Net Margin $ 585,912 $ 420,828 $ 455,026 $ 473,761
Operating Income $ 333,123 $ 173,012 $ 192,179 $ 218,690
Net Income $ 143,837 $ 41,865 $ 58,033 $ 68,174
Earnings per share from continuing operations
Basic $ 1.38 $ 0.40 $ 0.56 $ 0.65
Diluted $ 1.36 $ 0.39 $ 0.55 $ 0.65
First Second Third Fourth

Year Ended December 31, 2007 Quarter Quarter Quarter Quarter
Total Revenues $ 3,806,208 $ 2,876,241 $ 2,809,997 $ 3,984,968
Net Margin $ 564,850 $ 367,699 $ 340,160 $ 537,399
Operating Income $ 328,301 $ 135,745 $ 102,770 $ 255,727
Net Income $ 152,880 $ 35,203 $ 13,914 $ 102,924
Earnings per share from continuing operations
Basic $ 1.38 $ 0.32 $ 0.13 $ 0.99
Diluted $ 1.36 $ 0.31 $ 0.13 $ 0.98
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We have established disclosure controls and procedures to ensure that information required to be disclosed by us, including our consolidated
entities, in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods
specified in the SEC’s rules and forms. Under the supervision and with the
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participation of senior management, including our Chief Executive Officer (“Principal Executive Officer”) and our Chief Financial Officer
(“Principal Financial Officer”), we evaluated our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated
under the Exchange Act. Based on this evaluation, our Principal Executive Officer and our Principal Financial Officer concluded that our
disclosure controls and procedures were effective as of December 31, 2008.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in
Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our Principal Executive Officer
and Principal Financial Officer, we evaluated the effectiveness of our internal control over financial reporting based on the framework in
Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Because of
inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the
degree of compliance with the policies or procedures may deteriorate. Based on our evaluation under that framework and applicable SEC rules,
our management concluded that our internal control over financial reporting was effective as of December 31, 2008.
Our internal control over financial reporting as of December 31, 2008, has been audited by PricewaterhouseCoopers LLP, an independent
registered public accounting firm, as stated in their report which is included herein (Item 8).
Changes in Internal Controls Over Financial Reporting
We have made no changes in our internal controls over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act)
during the quarter ended December 31, 2008, that have materially affected, or are reasonably likely to materially affect, our internal control over
financial reporting.
ITEM 9B. OTHER INFORMATION
Not applicable.
PART III.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Directors of the Registrant
Information concerning our directors is set forth in our 2009 definitive Proxy Statement and is incorporated herein by this reference.
Executive Officers of the Registrant
Information concerning our executive officers is included in Part I, Item 1. Business, of this Annual Report on Form 10-K.
Compliance with Section 16(a) of the Exchange Act
Information on compliance with Section 16(a) of the Exchange Act is set forth in our 2009 definitive Proxy Statement and is incorporated herein
by this reference.
Code of Ethics
Information concerning the code of ethics, or code of business conduct, is set forth in our 2009 definitive Proxy Statement and is incorporated
herein by this reference.
Nominating Committee Procedures
Information concerning the nominating committee procedures is set forth in our 2009 definitive Proxy Statement and is incorporated herein by
this reference.
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Audit Committee
Information concerning the Audit Committee is set forth in our 2009 definitive Proxy Statement and is incorporated herein by this reference.
Audit Committee Financial Expert
Information concerning the Audit Committee Financial Expert is set forth in our 2009 definitive Proxy Statement and is incorporated herein by
this reference.
ITEM 11. EXECUTIVE COMPENSATION
Information on executive compensation is set forth in our 2009 definitive Proxy Statement and is incorporated herein by this reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
Security Ownership of Certain Beneficial Owners
Information concerning the ownership of certain beneficial owners is set forth in our 2009 definitive Proxy Statement and is incorporated herein
by this reference.
Security Ownership of Management
Information on security ownership of directors and officers is set forth in our 2009 definitive Proxy Statement and is incorporated herein by
this reference.
Equity Compensation Plan Information
The following table sets forth certain information concerning our equity compensation plans as of December 31, 2008.
Number of Securities
Remaining Available For
Number of Securities Weighted-Average Future Issuance Under
to be Issued Upon Exercise Price of Equity Compensation
Exercise of Outstanding Outstanding Options, Plans (Excluding
Options, Warrants and Rights Warrants and Rights Securities in Column (a))
Plan Category (a) (b) (c)
Equity compensation plans
approved by security holders (1) 2,300,035 $31.71 6,053,331
Equity compensation plans
not approved by security holders (2) 179,133 $27.03 (3) 4,153,578
Total 2,479,168 $31.37 10,206,909
(1) - Includes shares granted under our Employee Stock Purchase Plan, Employee Stock Award Program, stock options, restricted stock
incentive units and performance unit awards granted under our Long-Term Incentive Plan and Equity Compensation Plan. For a brief
description of the material features of these plans, see Note N of the Notes to Consolidated Financial Statements in this Annual Report on
Form 10-K. Column (c) includes 1,408,443, 155,648, 2,120,616 and 2,368,624 shares available for future issuance under our Employee Stock
Purchase Plan, Employee Stock Award Program, Long-Term Incentive Plan and Equity Compensation Plan, respectively.
(2) - Includes our Employee Non-Qualified Deferred Compensation Plan, Deferred Compensation Plan for Non-Employee Directors and Stock
Compensation Plan for Non-Employee Directors. For a brief description of the material features of these plans, see Note N of the Notes to
Consolidated Financial Statements in this Annual Report on Form 10-K. Column (c) includes 503,602, 2,707,003 and 942,973 shares
available for future issuance under our Stock Compensation Plan for Non-Employee Directors, Thrift Plan and Profit Sharing Plan,
respectively.
(3) - Compensation deferred into our common stock under our Employee Non-Qualified Deferred Compensation Plan and Deferred
Compensation Plan for Non-Employee Directors is distributed to participants at fair market value on the date of distribution. The price
used for these plans to calculate the weighted-average exercise price in the table is $29.12, which represents the year-end closing price of
our common stock on the NYSE.
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Information on certain relationships and related transactions and director independence is set forth in our 2009 definitive Proxy Statement and
is incorporated herein by this reference.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Information concerning the principal accountant’s fees and services is set forth in our 2009 definitive Proxy Statement and is incorporated
herein by this reference.
PART IV.
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(1) Financial Statements Page No.
(a) Reports of Independent Registered Public Accounting Firms 67-68
(b) Consolidated Statements of Income for the years ended 69

December 31, 2008, 2007 and 2006
(c) Consolidated Balance Sheets as of December 31, 2008 and 2007 70-71
(d) Consolidated Statements of Cash Flows for the years ended 73

December 31, 2008, 2007 and 200
(e) Consolidated Statements of Shareholders’ Equity and Comprehensive 74-75

Income for the years ended December 31, 2008, 2007 and 2006
(f) Notes to Consolidated Financial Statements 76-117
(2) Financial Statement Schedules
All schedules have been omitted because of the absence of conditions under which they are required.
(3) Exhibits
3 Not used.
3.1 Not used.
3.2 Not used.
3.3 Not used.
3.4 Amended and Restated Bylaws of ONEOK, Inc. (incorporated by reference from Exhibit 99.1 to Form 8-K filed January 20,
2009).
3.5 Amended and Restated Certificate of Incorporation of ONEOK, Inc. dated May 15, 2008 (incorporated by reference from
Exhibit 3.1 to Form 8-K filed May 19, 2008).
3.6 Certificate of Correction form dated November 5, 2008 (incorporated by reference from Exhibit 4.2 to Registration Statement
on Form S-3 filed November 21, 2008).
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4 Certificate of Designation for Convertible Preferred Stock of WAI, Inc. (now ONEOK, Inc.) filed November 21, 2008
(incorporated by reference from Exhibit 4.2 to Registration Statement on Form S-3 filed November 21, 2008, Commission File
No. 333-155593).
4.1 Certificate of Designation for Series C Participating Preferred Stock of ONEOK, Inc. filed November 21, 2008 (incorporated by
reference from Exhibit No. 4.2 to Registration Statement on Form S-3 filed November 21, 2008).
4.2 Form of Common Stock Certificate (incorporated by reference from Exhibit 1 to Registration Statement on Form 8-A filed
November 21, 1997).
4.3 Indenture, dated September 24, 1998, between ONEOK, Inc. and Chase Bank of Texas (incorporated by reference from Exhibit
4.1 to Registration Statement on Form S-3 filed August 26, 1998, Commission File No. 333-62279).
4.4 Indenture dated December 28, 2001, between ONEOK, Inc. and SunTrust Bank (incorporated by reference from Exhibit 4.1 to
Amendment No. 1 to Registration Statement on Form S-3 filed December 28, 2001, Commission File No. 333-65392).
4.5 First Supplemental Indenture dated September 24, 1998, between ONEOK, Inc. and Chase Bank of Texas (incorporated by
reference from Exhibit 5(a) to Form 8-K filed September 24, 1998).
4.6 Second Supplemental Indenture dated September 25, 1998, between ONEOK, Inc. and Chase Bank of Texas (incorporated by
reference from Exhibit 5(b) to Form 8-K filed September 24, 1998).
4.7 Third Supplemental Indenture dated February 8, 1999, between ONEOK, Inc. and Chase Bank of Texas (incorporated by
reference from Exhibit 4 to Form 8-K filed February 8, 1999).
4.8 Fourth Supplemental Indenture dated February 17, 1999, between ONEOK, Inc. and Chase Bank of Texas (incorporated by
reference from Exhibit 4.5 to Registration Statement on Form S-3 filed April 15, 1999, Commission File No. 333-76375).
4.9 Not used.
4.10 Not used.
4.11 Not used.
4.12 Eighth Supplemental Indenture dated April 6, 2001, between ONEOK, Inc. and The Chase Manhattan Bank (incorporated by
reference from Exhibit 4.9 to Registration Statement on Form S-3 filed July 19, 2001, Commission File No. 333-65392).
4.13 First Supplemental Indenture, dated as of January 28, 2003, between ONEOK, Inc. and SunTrust Bank (incorporated by
reference from Exhibit 4.22 to Registration Statement on Form 8-A/A filed January 31, 2003).
4.14 Second Supplemental Indenture, dated June 17, 2005, between ONEOK, Inc. and SunTrust Bank (incorporated by reference
from Exhibit 4.1 to Form 8-K filed June 17, 2005).
4.15 Third Supplemental Indenture, dated June 17, 2005, between ONEOK, Inc. and SunTrust Bank (incorporated by reference
from Exhibit 4.3 to Form 8-K filed June 17, 2005).
4.16 Form of Senior Note Due 2008 (included in Exhibit 4.13).
4.17 Form of 5.20 percent Notes Due 2015 (included in Exhibit 4.14).
4.18 Form of 6.00 percent Notes due 2035 (included in Exhibit 4.15).
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4.19 Not used.
4.20 Not used.
4.21 Not used.
4.22 Not used.
4.23 Not used.
4.24 Amended and Restated Rights Agreement dated as of February 5, 2003, between ONEOK, Inc. and UMB Bank, N.A., as
Rights Agent (incorporated by reference from Exhibit 1 to Registration Statement on Form 8-A/A (Amendment No. 1) filed
February 6, 2003).
10 ONEOK, Inc. Long-Term Incentive Plan (incorporated by reference from Exhibit 10(a) to Form 10-K for the fiscal year ended
December 31, 2001, filed March 14, 2002).
10.1 ONEOK, Inc. Stock Compensation Plan for Non-Employee Directors (incorporated by reference from Exhibit 99 to Form S-8
filed January 25, 2001).
10.2 ONEOK, Inc. Supplemental Executive Retirement Plan terminated and frozen December 31, 2004 (incorporated by reference
from Exhibit 10.1 to Form 8-K filed on December 20, 2004).
10.3 ONEOK, Inc. 2005 Supplemental Executive Retirement Plan, as amended and restated, dated December 18, 2008.
10.4 Form of Termination Agreement between ONEOK, Inc. and ONEOK, Inc. executives, as amended, dated January 1, 2003
(incorporated by reference from Exhibit 10.3 to Form 10-K for the fiscal year ended December 31, 2002, filed March 10, 2003).
10.5 Form of Indemnification Agreement between ONEOK, Inc. and ONEOK, Inc. officers and directors, as amended, dated
January 1, 2003 (incorporated by reference from Exhibit 10.4 to Form 10-K for the fiscal year ended December 31, 2002, filed
March 10, 2003).
10.6 ONEOK, Inc. Annual Officer Incentive Plan (incorporated by reference from Exhibit 10(f) to Form 10-K for the fiscal year
ended December 31, 2001, filed March 14, 2002).
10.7 ONEOK, Inc. Employee Nonqualified Deferred Compensation Plan, as amended and restated December 16, 2004
(incorporated by reference from Exhibit 10.3 to Form 8-K filed December 20, 2004).
10.8 ONEOK, Inc. 2005 Nonqualified Deferred Compensation Plan, as amended and restated, dated December 18, 2008.
10.9 ONEOK, Inc. Deferred Compensation Plan for Non-Employee Directors, as amended and restated, dated December 18, 2008.
10.10 Not used.
10.11 Not used.
10.12 Not used.
10.13 Not used.
10.14 Not used.
10.15 Not used.
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10.16 Not used.
10.17 $1,200,000,000 Amended and Restated Credit Agreement dated as of July 14, 2006 among ONEOK, Inc., as the Borrower,
Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Citibank, N.A., as L/C Issuer, and the
Lenders party hereto (incorporated by reference from Exhibit 10.1 to the Form 10-Q for the quarter ended June 30, 2006, filed
August 4, 2006).
10.18 Not used.
10.19 Not used.
10.20 Not used.
10.21 First Amendment, dated as of September 26, 2008, to the Amended and Restated Credit Agreement, dated as of July 14, 2006,
among ONEOK, Inc., as the Borrower, Bank of America, N.A., as the Administrative Agent, Swing Line Lender and L/C
Issuer, Citibank N.A., as L/C Issuer and the financial institutions named therein as lenders (incorporated by reference from
Exhibit 10.1 to our Form 10-Q filed November 6, 2008).
10.22 Not used.
10.23 Not used.
10.24 Not used.
10.25 Not used.
10.26 Not used.
10.27 Not used.
10.28 Not used.
10.29 Not used.
10.30 Not used.
10.31 Not used.
10.32 Services Agreement among ONEOK, Inc. and its affiliates and Northern Border Partners, L.P. and Northern Border
Intermediate Limited Partnership executed April 6, 2006, but effective as of April 1, 2006 (incorporated by reference from
Exhibit 10.1 to our Form 8-K filed April 12, 2006).
10.33 Third Amended and Restated Agreement of Limited Partnership of ONEOK Partners, L.P. dated as of September 15, 2006
(incorporated by reference to Exhibit 3.1 to ONEOK Partners, L.P.’s Form 8-K filed on September 19, 2006 (File No. 1-12202)).
10.34 Not used.
10.35 Not used.
10.36 Not used.
10.37 ONEOK, Inc. Profit Sharing Plan dated January 1, 2005 (incorporated by reference from Exhibit 99 to Registration Statement
on Form S-8 filed December 30, 2004).
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10.38 ONEOK, Inc. Employee Stock Purchase Plan as amended and restated effective as of December 20, 2007 (incorporated by
reference from Exhibit 4.2 to Registration Statement on Form S-8 filed August 4, 2008).
10.39 Form of Non-Statutory Stock Option Agreement (incorporated by reference from Exhibit 10.1 to Form 10-Q for the quarter
ended September 30, 2004, filed November 3, 2004).
10.40 Not used.
10.41 Not used.
10.42 Not used.
10.43 Not used.
10.44 ONEOK, Inc. Equity Compensation Plan, as amended and restated, dated December 18, 2008.
10.45 Form of Restricted Unit Award Agreement (incorporated by reference from Exhibit 10.45 to Form 10-K filed February 28,
2007).
10.46 Form of Performance Unit Award Agreement (incorporated by reference from Exhibit 10.46 to Form 10-K filed February 28,
2007).
10.47 First Amendment to Letter of Credit Reimbursement Agreement by and between KBC Bank N.V. and ONEOK, Inc. dated
December 19, 2005 (incorporated by reference from Exhibit 10.47 to our Form 10-K for the year ended December 31, 2006, filed
March 1, 2007).
10.48 Amended and Restated Revolving Credit Agreement dated March 30, 2007, among ONEOK Partners, L.P., as Borrower, the
lenders from time to time party thereto, SunTrust Bank, as Administrative Agent, Wachovia Bank, National Association, as
Syndication Agent, and BMO Capital Markets, Barclays Bank PLC, and Citibank, N.A., as Co-Documentation Agents
(incorporated by reference from Exhibit 10.1 to our Form 10-Q filed May 2, 2007).
10.49 Purchase Agreement dated June 27, 2007, by and between ONEOK, Inc. (the “Issuer”), and Bank of America, N.A., acting
through Banc of America Securities LLC (“Agent”) as agent (incorporated by reference from Exhibit 10.1 to our Form 10-Q
filed August 3, 2007).
10.50 Thrift Plan for Employees of ONEOK, Inc. and Subsidiaries as amended and restated effective as of January 1, 2008
(incorporated by reference from Exhibit 4.3 to Registration Statement on Form S-8 filed August 4, 2008).
10.51 Amendment No. 1 to Third Amended and Restated Agreement of Limited Partnership of ONEOK Partners, L.P. dated July 20,
2007 (incorporated by reference to Exhibit 3.1 to ONEOK Partners, L.P.’s Form 10-Q filed on August 3, 2007 (File No. 1-
12202)).
10.52 $400,000,000 364-Day Revolving Credit Agreement dated as of August 6, 2008, among ONEOK, Inc., as Borrower, Bank of
America, N.A., as the Administrative Agent and Swing Line Lender, the lenders named therein, Barclays Bank, PLC, BNP
Paribas, Suntrust Bank and UBS Loan Finance LLC as Co-Documentation Agents, and Banc of America Securities LLC as
sole Lead Arranger and sole Book Manager (incorporated by reference from Exhibit 10.4 to the Form 10-Q for the quarter
ended June 30, 2008, filed August 6, 2008).
10.53 Common Unit Purchase Agreement between ONEOK, Inc. and ONEOK Partners, L.P. dated March 11, 2008 (incorporated by
reference from Exhibit 1.1 to our Form 8-K filed March 12, 2008).
10.54 Form of Performance Unit Award Agreement dated January 15, 2009.
10.55 Form of Restricted Unit Stock Bonus Award Agreement dated January 15, 2009.
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12 Computation of Ratio of Earnings to Fixed Charges for the years ended December 31, 2008, 2007, 2006, 2005 and 2004.
16.1 Letter from KPMG LLP dated May 2, 2007, to the Securities and Exchange Commission regarding change in certifying
accountant (incorporated by reference to Exhibit 16.1 to our Form 8-K filed on May 2, 2007).
21 Required information concerning the registrant’s subsidiaries.
23.1 Consent of Independent Registered Public Accounting Firm - PricewaterhouseCoopers LLP.
23.2 Consent of Independent Registered Public Accounting Firm - KPMG LLP.
31.1 Certification of John W. Gibson pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification of Curtis L. Dinan pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 Certification of John W. Gibson pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002 (furnished only pursuant to Rule 13a-14(b)).
32.2 Certification of Curtis L. Dinan pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 (furnished only pursuant to Rule 13a-14(b)).
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Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
ONEOK, Inc.
Registrant
Date: February 24, 2009 By: /s/ Curtis L. Dinan

Curtis L. Dinan
Senior Vice President,
Chief Financial Officer and Treasurer
(Principal Financial Officer)
Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and
in the capacities indicated on this 24th day of February 2009.
/s/ John W. Gibson /s/ David L. Kyle

John W. Gibson David L. Kyle
Chief Executive Officer Chairman of the
Board of Directors
/s/ Caron A. Lawhorn /s/ James C. Day

Caron A. Lawhorn James C. Day
Senior Vice President and Director
Chief Accounting Officer
/s/ Julie H. Edwards /s/ William L. Ford

Julie H. Edwards William L. Ford
Director Director
/s/ Bert H. Mackie /s/ Jim W. Mogg

Bert H. Mackie Jim W. Mogg
Director Director
/s/ Pattye L. Moore /s/ Gary D. Parker

Pattye L. Moore Gary D. Parker
Director Director
/s/ Eduardo A. Rodriguez /s/ David J. Tippeconnic

Eduardo A. Rodriguez David J. Tippeconnic
Director Director
/s/ Mollie B. Williford

Mollie B. Williford
Director
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Exhibit 10.3
ONEOK, INC.
2005 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
As Amended and Restated December 18, 2008

ONEOK, INC.
Table of Contents
PURPOSE
PART A. EXCESS RETIREMENT BENEFITS
ARTICLE I. PURPOSE AND SCOPE OF PART A
1.1 Part A; Excess Retirement Benefits
1.2 Separate Benefits
1.3 Deferral of Compensation
ARTICLE II. ELIGIBILITY AND PARTICIPATION
2.1 Eligibility for Selection
2.2 Designation and Selection of Part A Participants in the Plan
2.3 Scope of Part A Participation
2.4 Election to Defer Compensation
ARTICLE III. EXCESS RETIREMENT BENEFIT
3.1 Excess Retirement Benefit
3.2 Payment of Excess Retirement Benefit
3.3 Specified Employee; Six (6) Month Required Delay in Payment
3.4 Vesting of Excess Retirement Benefit
3.5 Form of Payment
3.6 Disability
3.7 Death
3.8 Nonqualified Deferred Compensation Plan Requirements
ARTICLE IV. BENEFICIARY
ARTICLE V. LEAVE OF ABSENCE
ARTICLE VI. ADMINISTRATION OF PART A OF THIS PLAN
PART B. SUPPLEMENTAL RETIREMENT BENEFITS
ARTICLE I. PURPOSE AND SCOPE OF PART B
1.1 Part B, Supplemental Retirement Benefits
1.2 Separate Benefits
1.3 Deferral of Compensation
ARTICLE II. BENEFIT ACCOUNTS
2.1 Eligibility for Selection
--i-
2.2 Designation and Selection of Part B Participants in the Plan

2.3 Scope of Part B Participation
ARTICLE III. SUPPLEMENTAL RETIREMENT BENEFIT
3.1 Supplemental Retirement Benefit
3.2 Payment of Supplemental Retirement Benefit
3.3 Specified Employee; Six (6) Month Required Delay in Payment
3.4 Vesting of Supplemental Retirement Benefit
3.5 Form of Payment
3.6 Disability
3.7 Death
3.8 Nonqualified Deferred Compensation Plan Requirements
ARTICLE IV. BENEFICIARY
ARTICLE V. SUPPLEMENTAL RETIREMENT BENEFIT ADJUSTMENTS
ARTICLE VI. LEAVE OF ABSENCE
ARTICLE VII. ADMINISTRATION OF PART B OF THE PLAN
PART C. PLAN ADIMINSTRATION AND MISCELLANEOUS PROVISIONS
ARTICLE I. PURPOSE AND SCOPE OF PART C
ARTICLE II. DEFINITIONS AND CONSTRUCTION
2.1 Definitions
2.2 Construction
2.3 Plan Purpose
ARTICLE III. COMMITTEE
3.1 Appointment of Committee
3.2 Committee Officials
3.3 Committee Action
3.4 Committee Rules and Powers
3.5 Reliance on Certificates, etc.
3.6 Liability of Committee
3.7 Determination of Benefits
3.8 Information to Committee
ARTICLE IV. ADOPTION OF PLAN BY SUBSIDIARY, AFFILIATED OR ASSOCIATED COMPANIES
ARTICLE V. SOURCE OF BENEFITS
5.1 Benefits Payable
- - ii -
5.2 Investments to Facilitate Payment of Benefits

5.3 Ownership of Insurance Contracts
5.4 Trust for Payment of Benefits
ARTICLE VI. TERMINATION OF EMPLOYMENT
ARTICLE VII. TERMINATION OF PARTICIPATION
ARTICLE VIII. TERMINATION, AMENDMENT, MODIFICATION, OR SUPPLEMENT OF THE PLAN
8.1 Amendment or Termination
8.2 Rights and Obligations Upon Amendment, Termination
ARTICLE IX. TREATMENT OF BENEFITS
ARTICLE X. RESTRICTIONS ON ALIENATION OF BENEFITS
ARTICLE XI. MISCELLANEOUS
11.1 Deferral of Compensation Requirements
11.2 Execution of Receipts and Releases
11.3 No Guarantee of Interests
11.4 Company Records
11.5 Evidence
11.6 Notice
11.7 Change of Address
11.8 Effect of Provisions
11.9 Headings
11.10 Governing Law
11.11 Effective Date
APPENDIX I
- - iii -
ONEOK, INC.
PURPOSE
The purpose of the ONEOK, Inc. 2005 Supplemental Executive Retirement Plan is to provide the specified benefits to employees who are in
or highly compensated employees who contribute materially to the continued growth, development and future business success of ONEOK, Inc., a
January 1, 2005. It is the intention of ONEOK, Inc. that the Plan and the particular benefits provided to individuals hereunder be administered as an
compensation and excess benefit plans established and maintained for a select group of management or highly compensated employees.
This Plan is a new and separate plan, and except as otherwise expressly provided herein, is not a continuation, successor plan to, or an am
preexisting and separate ONEOK, Inc. Supplemental Executive Retirement Plan, as terminated and frozen pursuant to the terms thereof, effective De
referred to as the “Prior Frozen SERP”). It is intended that no individual shall be entitled to benefit under both the Prior Frozen SERP and this Plan.
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
until actually paid or distributed pursuant to the Plan.
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 Pla
indicated.
-1--
PART A. EXCESS RETIREMENT BENEFITS
-2--
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 E
are (i) in a select group of management or highly compensated employees of the Company within the meaning of Sections 201(a)(7), 301(a)(9) and 40
selected to participate in Excess Retirement Benefits pursuant to the terms and provisions of this Part A of the Plan.
1.2 Separate Benefits. The Excess Retirement Benefits provided to participants under Part A of the Plan are separate and independent f
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 an
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 for Selection. In order to be eligible to be selected as a Part A Participant in the Plan pursuant to Section 2.2 of this Article
in a select group of management or highly compensated employees of the Company, as determined by the Chief Executive Officer, or the Committee
Executive Officer, in the Chief Executive Officer’s (or Committee’s, as applicable) sole and absolute discretion. An eligible Employee may become a
only by being selected for participation pursuant to Section 2.2 of this Article II, below.
2.2 Designation and Selection of Part A Participants in the Plan.
A. In order to participate in Part A of the Plan an eligible Employee must also be specifically designated and selected b
in the case of the Chief Executive Officer, by the Committee, to be a Part A Participant in the Plan, with such designation and selection to b
Officer’s (or Committee’s, as applicable) sole and absolute discretion.
B. The designation and selection of any eligible Employee to be a Part A Participant in the Plan by the Chief Executive
confirmed in writing by a written instrument and/or memorandum which shall specify the date that compensation is first deferred under thi
Participant and the date of his/her designation and selection, in such form as is prescribed by the Committee that shall be in substantially
this Plan and that shall be made a part of the records of the Plan and the Company.
C. Not every eligible Employee is required to be, or necessarily will be designated and selected to be a Part A Participa
-3--
D. An eligible Employee who is not designated and selected to be a Part A Participant pursuant to this Section 2.2, sh
or payment under Part A of the Plan.
E. No Employee who is a participant in the Prior Frozen SERP or entitled to receive any benefit or payment under the P
designated and selected to be a Part A Participant in the Plan; and it may be made a condition to the designation and selection of an eligib
Participant that such Employee shall have elected in writing to completely terminate his/her participation in the Prior Frozen SERP and wai
benefit or payment under the Prior Frozen SERP.
F. Notwithstanding anything otherwise provided herein, any eligible Employee who becomes a Part A Participant sha
agree that his/her participation in Part A of the Plan shall supersede and cancel any entitlement he/she had to any benefit or payment unde
2.3 Scope of Part A Participation. An eligible Employee designated and selected to be a Part A Participant in the Plan shall, as a Part A
the rights and benefits provided under the terms of Part A of the Plan, and such designation and selection shall not entitle such Employee to partic
receive benefits thereunder; provided, that an Employee who is an Officer of the Company may be designated and selected to be a Part A Participan
the Plan to be a Part B Participant.
2.4 Election to Defer Compensation.
A. Except as provided in Section 2.4.B., of this Article, the Company, pursuant to the Plan, elects, determines and prov
payment of an Excess Retirement Benefit to any eligible Employee who is designated and selected to be a Part A Participant. The time and
Retirement Benefit is stated and provided in Article III of this Part A of the Plan.
B. A Part A Participant shall make a written Election that shall include a Specified Time which shall be the No
Distribution when his/her Excess Retirement Benefit is to be paid and distributed under the Plan. The Specified Time that may be
(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
(iii) has a Separation from Service with the Company; or
(2) The date such Part A Participant (i) attains age fifty (50), (ii) completes five (5) years of service with the Company, and (iii) ha
the Company.
-4--
The Normal Specified Time of Distribution of a Part A Participant shall in no event be before he/she (i) attains age fifty (50), (ii) co
with the Company, and (iii) has a Separation from Service with the Company.
C. The designation and Election of the time and form of payment of the Excess Retirement Benefit of an eligible Emplo
designated and selected to be a Part A Participant in the Plan shall be made and confirmed in writing on or before the date that is thirty (30
designation and selection in an instrument prescribed by the Committee that shall be in substantially the same form as Appendix I to this P
of the records of the Plan and the Company.
D. The designation and Election of the time and form of payment of an Excess Retirement Benefit of a Part A Participa
compensation deferred under the Plan for the Part A Participant after the date of his/her designation and selection. The designation and E
payment of an Excess Retirement Benefit of a Part A Participant shall be effective on and after the date that it is made by the Part A Partici
compensation deferred under the Plan for all taxable years of the Part A Participant thereafter.
E. The Plan does not provide an eligible Employee or Part A Participant the opportunity to make an initial election of t
Retirement Benefit to him/her under the Plan. A Part A Participant shall be allowed to change the form of an annuity benefit to the extent p
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 Retir
Section 3.2 of Article III of this Part A of the Plan.
F. All Elections made under the Plan by and for a Part A Participant on or before December 31, 2008, shall be retroacti
terms and provisions of the Plan, as amended and restated effective December 18, 2008, to meet the requirements of Code section 409A an
extent allowed under such regulations and published guidance of the Internal Revenue Service.
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’
under the Retirement Plan that is in excess of the limitations on such Part A Participant’s Retirement Plan Benefits contained in Code Sectio
B. The Excess Retirement Benefit will be calculated by applying the same benefit formula, vesting provisions, and early retir
apply to the Part A Participant’s Retirement Plan Benefit under the Retirement Plan.
-5--
C. The Excess Retirement Benefit shall be calculated for the time of the commencement of payment of it to a Part A Particip
"Excess Retirement Benefit Commencement Date") pursuant to the terms and provisions of the Plan governing the time and form of payme
whether or not a corresponding Retirement Plan Benefit is then being paid or is to commence payment to such Part A Participant at that tim
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
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 Commencem
(3) Apply the factors for the form of payment that has been elected by the Part A Participant in accordance with the terms and pr
actuarial equivalent of a single (straight) life annuity, if such elected form of payment is other than a single (straight) life annuity in accord
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, irrespe
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
commence the payment of an Excess Retirement Benefit to a Part A Participant at the Excess Retirement Benefit Commencement Date.
F. All Elections made under the Plan by and for a Part B Participant on or before December 31, 2008, shall be retroactively e
and provisions of the Plan, as amended and restated effective December 18, 2008, to meet the requirements of Code section 409A and Trea
allowed under such regulations and published guidance of the Internal Revenue Service.
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 v
shall be paid to a Part A Participant entitled thereto or his/her Beneficiary, commencing on his/her Normal Specified Distribution Date.
-6--
B. A Part A Participant shall be allowed to make a Subsequent Election to change the time of distribution and paymen
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
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
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 D
of his/her Excess Retirement Benefit if:
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
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 Pa
Election made by a Part A Participant under the Plan shall result in a Subsequent Election Distribution Date of his/her Excess Retirement B
and the first distribution and payment with respect to which such Subsequent Election is made being deferred to a Subsequent Election D
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
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
specified under the Plan and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. In addition
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 ea
the designated payment date and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. For p
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 t
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 distribu
administratively practicable due to events beyond the
-7--
control of the Participant (or Participant's beneficiary), the distribution or payment will be treated as made upon the date specified under th
payment is made during the first taxable year of the Participant in which the calculation of the amount of the distribution or payment is adm
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 P
beneficiary) to provide reasonably available information necessary to make such calculation does not constitute an event beyond the cont
3.3 Specified Employee; Six (6) Month Required Delay in Payment. If a Part A Participant is a Specified Employee, his/her vested Exces
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 D
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
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
Participant would have become a Specified Employee if the Participant had continued to provide services through the next Specified Employee Effe
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 n
Specified Employee after the next Specified Employee Effective Date had the Specified Employee continued in employment with the Corporation th
Employee Effective Date. The required delay in payment is met if payments to which a Specified Employee would otherwise be entitled during the f
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
Specified Employee is otherwise entitled upon a Separation from Service is delayed by six (6) months. The Committee shall have and retain discretio
be implemented, provided that no direct or indirect election as to the method may be provided to the Participant. For an affected Specified Employe
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
Plan once the Separation from Service has occurred.
In such a case, the Part A Participant shall, to the extent permissible under Code Section 409A, receive a Specified Employee Catch-Up Pay
Employee Required Deferral Period and thereafter receive vested Excess Retirement Benefit monthly payments in accordance with the Plan. If such
Payment is not permissible under Code Section 409A, the Excess Retirement Benefit shall be paid and distributed to the Specified Employee in acco
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 Participa
upon such Part
-8--
A Participant’s completion of five (5) Years of Service; provided, that the Excess Retirement Benefit shall not be vested and nonforfeitable upon Re
has not completed five (5) Years of Service.
3.5 Form of Payment. The vested Excess Retirement Benefit shall be paid to a Part A Participant in the form of a 50% qualified joint and
the Retirement Plan, if such Part A Participant is married on his/her Initial Participation Date as a Part A Participant. The vested Excess Retirement B
of a single (straight) life annuity, as defined in the Retirement Plan, if such Part A Participant is unmarried on his/her Initial Participation Date as a P
Participant shall be allowed to change the form of payment of an Excess Retirement Benefit that is initially elected and designated, or any permissib
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 b
writing by the Participant in an instrument prescribed by the Committee prior to the first payment and distribution of an Excess Retirement Benefit, (
that the previously elected form of payment and the changed form of payment are actuarially equivalent applying reasonable actuarial methods and
A Participant complies with such other requirements as the Committee may prescribe. A change in form of payment pursuant to the foregoing prov
accelerate the scheduled date for the first annuity payment of an Excess Retirement Benefit under the Plan. Each change in form of payment of an E
pursuant to the foregoing provisions shall be deemed to make a similar change in the form of payment with respect to any Supplemental Retirement
Participant under the Plan
3.6 Disability. If a Part A Participant shall become Disabled prior to Retirement and such total disability continues for more than six (6) m
entitled to receive an Excess Retirement Benefit. The vested Excess Retirement Benefit of such Part A Participant shall be distributed on the first da
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 o
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
Participant shall be entitled to make a Subsequent Election with respect to the distribution of a vested Excess Retirement Benefit in accordance wit
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 Pla
percent (55%) of his/her vested Excess Retirement Benefit of such Part A Participant shall be paid and distributed to the Beneficiary of such Part A
IV of this Part A of the Plan, below, 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, th
under this Plan shall be subject to the requirements set forth in Article XI, Section 11.1 of Part C of the Plan.
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ARTICLE IV.
BENEFICIARY
The Beneficiary of a Part A Participant’s Excess Retirement Benefit shall be the person or persons who would be the beneficiary or benefic
Retirement Plan Benefit of the Part A Participant under the terms and provisions of the Retirement Plan if he/she died prior to the commencement of
Plan Benefit under the Retirement 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 em
Participant’s participation in Part A of the Plan shall remain in effect.
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 Pla
- 10 - -
PART B. SUPPLEMENTAL RETIREMENT BENEFITS
- 11 - -
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 retiremen
(i) in a select group of management or highly compensated employees of the Company within the meaning of Sections 201(a)(2), 301(a)(3) and 401(a
Company, and (iii) selected to participate in and receive Supplemental Retirement Benefits pursuant to the terms and provisions of this Part B of the
1.2 Separate Benefits. The Supplemental Retirement Benefits provided to participants under Part B of the Plan are separate and indepen
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 conside
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 for Selection. In order to be eligible to be selected as a Part B Participant in the Plan, pursuant to Section 2.2 of this Articl
be an Officer of the Company, who is in a select group of management or highly compensated employees of the Company, as determined by the Ch
case of the Chief Executive Officer, by the Committee, in the Chief Executive Officer’s (or Committee’s, as applicable) sole and absolute discretion. A
may become a Part B Participant in the Plan only by being selected pursuant to Section 2.2 of this Article II, below.
2.2 Designation and Selection of Part B Participants in the Plan.
A. In order to participate in Part B of the Plan an eligible Employee/Officer must be specifically designated and selecte
or in the case of the Chief Executive Officer, by the Committee, to be a Part B Participant in the Plan, with such designation and selection to
Officer’s (or Committee’s, as applicable) sole and absolute discretion.
B. The designation and selection of an eligible Employee/Officer to be a Part B Participant in the Plan by the Chief Exe
be confirmed in writing by a written instrument and/or memorandum which shall specify the date that compensation is first deferred under
Participant and the date of his/her designation and selection, in such form as is prescribed by the Committee that shall be in substantially
this Plan and that shall be made a part of the records of the Plan and the Company.
C. Not every eligible Employee/Officer is required to be, or necessarily will be designated and selected to be a Part B P
- 12 - -
D. An eligible Employee/Officer who is not designated and selected to be a Part B Participant in the Plan, pursuant to
entitled to any benefit or payment under Part B of the Plan.
E. No Employee/Officer, and who is a participant in the Prior Frozen SERP or entitled to receive any benefit or paymen
shall be designated and selected to be a Part B Participant in the Plan; and it may be made a condition to the designation and selection of a
be a Part B Participant that he/she shall have elected in writing to completely terminate his/her participation in the Prior Frozen SERP and w
any benefit or payment under the Prior Frozen SERP.
F. Notwithstanding anything otherwise provided herein, any eligible Employee/Officer who becomes a Part B Particip
to and agree that his/her participation in Part B of the Plan shall supersede and cancel any entitlement he/she had to any benefit or payme
2.3 Scope of Part B Participation. An Employee/Officer designated and selected to be a Part B Participant in the Plan shall as a Part B P
the rights and benefits provided under Part B of the Plan, and such designation and selection shall not entitle such Employee/Officer to participate
any benefit thereunder; provided, that an Employee/Officer may be designated and selected to be a Part B Participant and designated and selected
Part A Participant under the Plan.
A. Except as otherwise provided in Section 2.4.B. of this Article, the Company, pursuant to the Plan, elects, determine
form of payment of a Supplemental Retirement Benefit to any eligible Employee who is designated and selected to be a Part B Participant.
a Supplemental Retirement Benefit is stated and provided in Article III of this Part B of the Plan.
B. A Part B Participant shall make a written Election that shall include a Specified Time which shall be the Normal Spec
his/her Supplemental Retirement Benefit is to be paid and distributed under the Plan. The Specified Time that may be stated in the Election
(1) The later of (a) a Specified Date, or (b) the date such Part B Participant (i) attains age fifty (50), (ii) completes five (5) years of s
(iii) has a Separation from Service with the Company; or
(2) the date such Part B Participant (i) attains age fifty (50), (ii) completes five (5) years of service with the Company, and (iii) has
the Company.
- 13 - -
The Normal Specified Time of Distribution of a Part B Participant shall in no event be before he/she (i) attains age fifty (50), (ii) co
with the Company, and (iii) has a Separation from Service with the Company.
C. The designation and Election of the time and form of payment of the Supplemental Retirement Benefit of an eligible
designated and selected to be a Part B Participant in the Plan shall be made and confirmed in writing on or before the date that is thirty (30
designation and selection in an instrument prescribed by the Committee, that shall be in substantially the same form as Appendix I and tha
records of the Plan and the Company.
D. The designation of the time and form of payment of a Supplemental Retirement Benefit of a Part B Participant shall
compensation deferred under the Plan for the selected Part B Participant after the date of his/her designation and selection. The designati
payment of a Supplemental Retirement Benefit of a Part B Participant shall be effective on and after the date that it is made by the Part B Pa
compensation deferred under the Plan for all taxable years of the Part B Participant thereafter.
E. The Plan does not provide an eligible Employee or Part B Participant the opportunity to make an initial election of th
Supplemental Retirement Benefit to him/her under the Plan. A Part B Participant shall be allowed to change the form of an annuity benefit
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 an
provided in Section 3.2 of Article III of this Part B of the Plan.
F. All Elections made under the Plan by and for a Part B Participant on or before December 31, 2008, shall be retroactiv
terms and provisions of the Plan, as amended and restated effective December 18, 2008, to meet the requirements of Code section 409A an
extent allowed under such regulations and published guidance of the Internal Revenue Service.
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 a
(1) Calculate a single (straight) life annuity payable at age sixty-five (65) equal to the product of the Part B Participant’s Final Ave
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 mu
Participant’s Service Factor Percentage at his/her Retirement under the Table in Section 3.1.E. of this Article III, below;
- 14 - -
(2) Apply early commencement of payment provisions based upon the age of the Part B Participant when Supplemental Retireme
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 pro
actuarial equivalent of a single (straight) life annuity, if such elected form of payment is other than a single (straight) life annuity, in accord
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 purs
Article III, below, calculated at the same time and the form of the Supplemental Retirement Benefit elected under this Plan, irrespective of t
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 P
referred to as the "Supplemental Retirement Benefit Commencement Date") pursuant to the terms and provisions of this Plan governing th
thereof, irrespective of whether or not a corresponding Retirement Plan Benefit is then being paid or is to commence payment to such Part
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
C. The Committee shall be authorized to take such other actions and apply procedures that it determines, in its discret
commence the payment of a Supplemental Retirement Benefit to a Part B Participant at the Supplemental Retirement Benefit Commencemen
D. Benefit Factor Percentage. A Part B Participant’s Benefit Factor Percentage shall be based upon his/her age at his/
Benefit Factor
Retirement Age 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%
- 15 - -
Benefit Factor
Retirement Age Percentage
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 Ye
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%
F. Adjustment of Retirement Benefit Payments; Early Commencement. The amount of a Part B Participant’s Supplemental
will be reduced by reason of early commencement of payment thereof, based on the following table depending upon the Part B Participant
Retirement Benefit payments to the Part B Participant commence:
Part B Participant Early Commencement Reduced

Age At Commencement Payout Percentage Factor
Under 50 0
50 50%
51 55%
- 16 - -
Part B Participant Early Commencement Reduced

Age At Commencement Payout Percentage Factor
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 redu
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
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 re
Benefit under Part A of the Plan, the Supplemental Retirement Benefit of such Part B Participant shall be offset and reduced by an amount
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
Benefit shall be paid to a Part B Participant entitled thereto or his/her Beneficiary, commencing on his/her Normal Specified Distribution D
B. A Part B Participant shall be allowed to make a Subsequent Election to change the time of distribution and payment
Retirement Benefit from his/her Normal Specified Distribution Date to a Subsequent Election Distribution Date resulting from such election
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
Plan in such written notification.
- 17 - -
C. A Part B Participant shall be allowed to make a Subsequent Election as to any Subsequent Election Distribution D
his/her Supplemental Retirement Benefit if:
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
Plan in such written notification.
D. Notwithstanding anything to the contrary otherwise provided in the Plan or in any Election or Subsequent Election
Subsequent Election made under the Plan shall result in a Subsequent Election Distribution Date of his/her Supplemental Retirement Bene
the first distribution and payment with respect to which such Subsequent Election is made being deferred to a Subsequent Election Distri
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
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
specified under the Plan and the Participant is not permitted, directly or indirectly, to designate the taxable year of the payment. In addition
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 ea
the designated payment date and the Participant is not permitted, directly or indirectly to designate the taxable year of the payment. For pu
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 t
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 distribu
administratively practicable due to events beyond the control of the Participant (or Participant's beneficiary), the distribution or payment w
date specified under the Plan if the distribution or payment is made during the first taxable year of the Participant in which the calculation
or payment is administratively practicable. For purposes of this section, the inability of a Corporation to calculate the amount or timing of
a failure of a Participant (or Participant's beneficiary) to provide reasonably available information necessary to make such calculation does
the control of the Participant.
- 18 - -
3.3 Specified Employee; Six (6) Month Required Delay in Payment. If a Part B Participant is a Specified Employee his/her Supplemental
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 D
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
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
Participant would have become a Specified Employee if the Participant had continued to provide services through the next Specified Employee Effe
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 n
Specified Employee after the next Specified Employee Effective Date had the Specified Employee continued in employment with the Corporation th
Employee Effective Date. The required delay in payment is met if payments to which a Specified Employee would otherwise be entitled during the f
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
Specified Employee is otherwise entitled upon a Separation from Service is delayed by six (6) months. The Committee shall have and retain discretio
be implemented, provided that no direct or indirect election as to the method may be provided to the Participant. For an affected Specified Employe
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
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 Pay
Employee Required Deferral Period and thereafter receive vested Supplemental Retirement Benefit monthly payments in accordance with the Plan. I
Catch-Up Payment is not permissible under Code Section 409A, the Supplemental Retirement Benefit shall be paid and distributed to the Specified E
requirements of Code Section 409A and the regulations thereunder, and the time and form of payment elected shall not otherwise be changed or ac
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 Supplem
unconditionally vest in such Part B Participant and become nonforfeitable upon the Part B Participant’s completion of five (5) Years of Service; pro
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 h
of Service.
3.5 Form of Payment. The vested Supplemental Retirement Benefit shall be paid to a Part B Participant in the form of a 50% qualified jo
defined in the Retirement Plan, if such Part B Participant is married on his/her Initial Participation Date as a Part B Participant. The vested Suppleme
paid in the form of a
- 19 - -
single (straight) life annuity, as defined in the Retirement Plan, if such Part B Participant is unmarried on his/her Initial Participation Date as a Part B
shall be allowed to change the form of payment of a Supplemental Retirement Benefit that is initially elected and designated, or any permissible for
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 b
writing by the Part B Participant in an instrument prescribed by the Committee prior to the first payment and distribution of a Supplemental Retir
determines that the previously elected form of payment and the changed form of payment are actuarially equivalent applying reasonable actuaria
(iii) the Part B Participant complies with such other requirements as the Committee may prescribe. A change in form of payment pursuant to th
change, delay or accelerate the scheduled date for the first annuity payment of a Supplemental Retirement Benefit under the Plan. Each c
Supplemental Retirement Benefit pursuant to the foregoing provisions shall be deemed to make a similar change in form of payment with respect
payable to the Participant under the Plan
3.6 Disability. If a Part B Participant becomes Disabled prior to his/her Separation from Service, the vested Supplemental Retirement Be
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
vested Supplemental Retirement Benefit of such Part B Participant shall be distributed on the first day of the month next following such Part B Part
(50) if he/she becomes Disabled prior to attaining that age. A Part B Participant shall be entitled to make a Subsequent Election with respect to the
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 a
(55%) of his/her vested Supplemental Retirement Benefit shall be paid and distributed to the Beneficiary of such Part B Participant on the first day o
date of death of such Part B Participant.
3.8 Nonqualified Deferred Compensation Plan Requirements. Notwithstanding anything to the contrary expressed or implied herein, th
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 would be the beneficiary or b
the Retirement Plan Benefit of the Part B Participant under the terms and provisions of the Retirement Plan if he/she died prior to the commencemen
Plan Benefit under the Retirement Plan.
- 20 - -
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 Supplementa
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
Service, the waiver of an offset of retirement benefits provided by a prior employer, or such other adjustments as the Committee determines, in its s
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 em
Participant’s Plan Agreement shall remain in effect.
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
- 22 - -
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 appli
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 Pla
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 ot
the context:
“Base Cash Compensation” shall mean the regular monthly salary paid to a Participant by the Company before any deductions o
purposes, and excluding any vehicle allowance, incentives, commissions and any other special pay.
“Beneficiary” shall mean the individual or individuals entitled to receive any benefits in accordance with the terms of Article IV o
of the Plan, respectively.
“Board of Directors” shall mean the Board of Directors of ONEOK, Inc., unless otherwise indicated or the context otherwise requ
“Change in Ownership or Control” shall mean to the extent provided by Treasury Regulations issued under Code Section 409A,
effective control of the Company, or in the ownership of a substantial portion of the assets of the Company.
“Chief Executive Officer” shall mean the Chief Executive Officer of the Company.
“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
and individual Plan Agreements in accordance with the provisions of Article III of this Part C of the Plan.
“Company” shall mean ONEOK, Inc., an Oklahoma corporation, or any division or subsidiary thereof.
“Compensation” shall mean the Base and Short-Term Incentive Cash Compensation from the Company paid to or deferred by a P
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“Deferred Compensation” shall mean any Excess Retirement Benefit or Supplemental Retirement Benefit to be paid to a Participan
“Disabled” shall mean that a Participant is unable to engage in substantial gainful activity by reason of any medically determinab
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 re
determinable physical or mental impairment which can be expected to last for a continuous period of not less than twelve (12) months, rece
benefits for a period of not less than three (3) months under an accident or health plan covering Employees of the Company.
“Effective Date” shall mean the effective date of the Plan, January 1, 2005.
“Election” shall mean the initial Election of a Participant or by the Company to defer payment and distribution of Deferred Compe
pursuant to the terms and provisions of the Plan, that shall include the Participant's Election of the time of payment and the Company's Ele
“Election Date” shall mean the date of the Election by the Participant and the Company to defer compensation under the Plan for
Part A Participant or a Part B Participant, that is made or deemed made pursuant to the terms of the Plan.
“Employee” shall mean any person who is in the regular full-time employment of the Company or is on authorized leave of absenc
the personnel rules and practices of the Company. The term does not include persons who are retained by the Company solely as consult
“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 Pa
entitled under the Retirement Plan if such Retirement Plan Benefit was computed without the restrictions or limitations imposed by Section
Code as now or hereafter in effect, less (ii) the amount of Retirement Plan Benefit payable to the Part A Participant under the Retirement Pl
“Final Average Earnings” shall mean the average of the highest thirty-six (36) consecutive months Compensation during the last
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 distribut
determined and fixed at the time the deferral of such Compensation is first elected by the Participant.
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“Initial Participation Date” shall mean the date an Employee or Officer first becomes a Part A Participant and/or Part B Participant
”Normal Specified Distribution Date” shall mean as to a Part A Participant or Part B Participant, the first day of the calendar mont
with the later of the date the Participant has elected in his/her Election the Specified Time of payment and distribution of compensation de
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 s
(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)
Company, and (c) has a Separation from Service with the Company.
“Officer” shall mean a person who is an elected officer of the Company.
“Part A Participant” shall mean an Employee who is selected and elects to participate in Part A of the Plan in accordance with the
A of the Plan.
“Part B Participant” shall mean an Employee who is selected and elects to participate in Part B of the Plan in accordance with the
of the Plan.
“Performance-Based Compensation” shall mean Compensation that is conditioned upon or subject to meeting certain requiremen
Section 162(m), as more particularly provided for in Treasury Regulations issued under Code Section 409A.
“Plan Agreement” shall mean a form of written agreement which is entered into by and between the Company and an Employee s
as a condition to participation in the Plan as provided in Sections 2.2 and 2.4 of Article II of Part B of the Plan.
“Plan” shall mean this ONEOK, Inc. 2005 Supplemental Executive Retirement Plan as embodied herein and as amended from time
“Prior Frozen SERP” shall mean the separate preexisting ONEOK, Inc. Supplemental Executive Retirement Plan, terminated and fro
effective December 31, 2004.
“Rabbi Trust” shall mean the trust created to hold assets which will be used to pay the benefits provided hereunder, as provided
Part C of the Plan.
“Retirement” and “Retire” shall mean when Participant attains age fifty (50), completes five (5) years of service with the Company
Service from the Company other than Separation from Service as a result of death of the Employee, irrespective of whether or not the Empl
retired
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under the Retirement Plan or for any other purpose at the time of his/her termination of employment with the Company.
“Retirement Plan” shall mean the Retirement Plan for Employees of ONEOK, Inc. and Subsidiaries.
“Retirement Plan Benefit” shall mean the benefit or benefits to which a Part A and/or Part B Participant is entitled under the Retire
“Retirement Plan Benefit Commencement Date” means the date a Participant commences receiving payments of his/her Retiremen
Plan.
“Separation from Service” shall mean the termination of a Participant’s employment with the Company.
“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 ONEOK, Inc. Annual Employee
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 o
the Company is then publicly traded on an established securities market or otherwise; and for purposes of this definition, an Employee is a
meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with the regulations thereunder and disregarding
during the 12-month period ending on a Specified Employee Identification Date. If an Employee is a key employee as of a Specified Employ
Employee shall be treated as a key employee for purposes of the Plan for the entire 12-month period beginning on the Specified Employee
identifying a Specified Employee by applying the requirements of section 416(i)(1)(A)(i), (ii), and (iii), the definition of compensation under
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 rule
were not using any of the elective special rules provided in §1.415(c)-2(g).
“Specified Employee Catch-Up Payment” shall mean a lump sum payment equal to all regularly scheduled Excess Retirement Ben
Retirement Benefit monthly payments to which a Part A Participant or Part B Participant is entitled to under the Plan but which are not pai
commencement of payment of his/her Retirement Plan Benefit because of a Key Employee Required Deferral Period.
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“Specified Employee Effective Date” means the first day of the fourth month following the Specified Employee Identification Dat
“Specified Employee Identification Date” means December 31.
“Specified Employee Required Deferral Period” shall mean the deferral of payment and distribution of an Excess Retirement Benef
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 Sepa
Participant.
In the case of any Participant who is a Specified Employee as of the date of a Separation from Service, distribution and payments
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
Specified Employee). For this purpose, a Participant who is not a Specified Employee as of the date of a Separation from Service will not b
requirement even if the Participant would have become a Specified Employee if the Participant had continued to provide services through
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 r
Participant would not have been treated as a Specified Employee after the next Specified Employee Effective Date had the Specified Emplo
with the Corporation through the next Specified Employee Effective Date. The required delay in payment is met if payments to which a Spe
otherwise be entitled during the first six (6) months following the date of Separation from Service are accumulated and paid on the first day
the date of Separation from Service, or if each payment to which a Specified Employee is otherwise entitled upon a Separation from Servic
The Committee shall have and retain discretion to choose which method will be implemented, provided that no direct or indirect election a
to the Participant. For an affected Specified Employee, a date upon which the Committee or the Corporation designates that the payment w
delay is treated as a fixed payment date for purposes of the other requirements of the Plan once the Separation from Service has occurred.
“Specified Time” shall mean a specified date at which Deferred Compensation deferred by or for a Participant pursuant to the Pla
paid and which is specified at the time the Election of deferral of such Deferred Compensation.
“Subsequent Election” shall mean an irrevocable written election made by a Participant to change the time of distribution or paym
deferred under the Plan that is made at any time after the initial Election with respect to such Deferred Compensation, or after a prior Subse
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
scheduled date of the first annuity payment shall not be considered as a change in the time and form of
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payment constituting a Subsequent Election if the annuities are actuarially equivalent, and such change is allowed as contemplated in Tre
2(b)(ii).
A Subsequent Election may be made and effective under the Plan only if the following conditions are met:
(i) Such Subsequent Election shall not take effect until at least twelve (12) months after the date on w
be considered valid;
(ii) Except in the case of an election permitted under Section 409A and the Treasury Regulations §1.4
account of disability), § 1.409A-3(a)(3) (payment on account of death), or §1.409A-3(a)(6) (payment on account of the occurrence
emergency), the payment with respect to which such Subsequent Election shall be deferred for a period of not less than five (5) y
would otherwise have been paid (or in the case of a life annuity or installment payments treated as a single payment, five (5) year
was scheduled to be paid); and
(iii) Any Subsequent Election related to a payment described in Treasury Regulations §1.409A-3(a)(
or pursuant to a fixed schedule) shall be made not less than twelve (12) months before the date the payment is scheduled to be pa
annuity or installment payments treated as a single payment, twelve (12) months before the date the first amount was scheduled t
“Subsequent Election Distribution Date” shall mean with respect to a Part A Participant or Part B Participant, the first day of the c
coincident with the first date on or after Subsequent Election Specified Time on which the Participant (i) has a Separation from Service wit
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 Participa
is not less than five (5) years from the date payment would otherwise have been made to the Participant. The written specification of the th
Subsequent Election Specified Time shall in all cases specify and fix a Subsequent Election Specified Time that is not less than five (5) yea
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 A
provisions of Part B of the Plan.
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“Unforeseeable Emergency” shall mean a severe financial hardship to the Participant resulting from illness or accident of the Par
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 s
circumstances arising as a result of events beyond the control of the Participant, and it is intended and directed with respect to any such U
any amounts distributed under the Plan by reason thereof shall not exceed the amounts necessary to satisfy such emergency plus amount
reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved thro
compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would no
hardship.
“Years of Service” shall include each full year, but not any portion of a year, during which the Participant has been employed by
subsidiary thereof.
2.2 Construction. The singular when used herein may include the plural unless the context clearly indicates to the contrary. The words
“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.
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 S
Plan unless otherwise specified.
2.3 Plan Purpose. The Plan is intended to be an unfunded deferred compensation, excess and supplemental retirement benefit plan esta
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 4
under the respective provisions of Part A and Part B of the Plan, and the Company intends that any Participant or Beneficiary shall have the status
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 adm
such intended purpose.
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
hereunder, as well as construction and interpretation thereof, shall be vested in the Committee, the number and members of which shall be designa
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
shall be filled promptly by the Board of Directors.
3.2 Committee Officials. The Board of Directors may designate one of the members of the Committee as Chairman and may appoint a se
member of the Committee. The secretary shall keep minutes of the Committee’s proceedings and all data,
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records, and documents relating to the Committee’s administration of the Plan and any Plan Agreements executed hereunder. The Committee may a
subcommittees with such powers as the Committee shall determine. The Committee may authorize one or more of its members, or any other person
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 t
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 m
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
administration of the Plan, including Plan Agreements. Except as herein otherwise expressly provided, the Committee shall have the exclusive right
Plan Agreements, and to decide any and all matters arising thereunder or in connection with the administration of the Plan and any Plan Agreement
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 exclus
Participant has become Disabled with respect to a Participant (consistent with the Plan’s definition of the term), such determinations to be made on
other evidence that the Committee, in its sole and absolute discretion, may require. Such decisions, actions, and records of the Committee shall be
the Company, the Participants, and all persons having or claiming to have rights or interests in or under the Plan.
3.5 Reliance on Certificates, etc. The members of the Committee and the Officers and Directors of the Company shall be entitled to rely
made by any duly appointed accountants, and on all opinions given by any duly appointed legal counsel. Such legal counsel may be counsel for t
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, o
part, excepting only his own willful misconduct. The Company shall indemnify and save harmless each member of the Committee against any and al
out of membership on the Committee, excepting only expenses and liabilities arising out of a Committee member’s own willful misconduct. Expenses
Committee shall be indemnified hereunder shall include, without limitation, the amount of any settlement or judgment, costs, counsel fees, and relat
in connection with a claim asserted, or a proceeding brought, or settlement thereof. The foregoing right of indemnification shall be in addition to a
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 cer
Plan Agreement, the amount and kind of benefits from time to time payable to Participants and their Beneficiaries, and to authorize all disbursement
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3.8 Information to Committee. To enable the Committee to perform its functions, the Company shall supply full and timely information to
relating to the compensation of all Participants, their retirement, death, or other cause for termination of employment, and such other pertinent facts
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
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
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 sha
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 C
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 pu
order to provide the means for the payment of any Excess Retirement Benefits and Supplemental Retirement Benefits under the Plan, the Company
event, no Participant shall have any interest whatever in such asset, fund, or insurance contract. In the event the Company elects to purchase or c
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
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 i
the insurance carrier may require, including the results and reports of previous Company and other insurance carrier physical examinations as may
other action which may be requested by the Company and the insurance carrier to obtain such insurance coverage. If a Participant does not coope
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 Partici
ownership therein, including, but not limited to, the right to cash and loan values, dividends, if any, death benefits, and the right to termination ther
no interest whatsoever in such contracts, if any, and shall exercise none of the incidents of ownership thereof. Provided, however, the Company m
contracts to the trustee of the Rabbi Trust.
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5.4 Trust for Payment of Benefits. The Company shall create or utilize a Rabbi Trust for the purpose of facilitating any retirement
hereunder. Such trust will be funded to provide the applicable vested Excess Retirement Benefits and Supplemental Retirement Benefits payable un
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 Pl
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,
contracts insuring the lives of Participants, as the case may be, from qualified and financially sound insurance companies, and such other forms or
Company may select from time to time to provide the applicable vested Excess Retirement Benefits and Supplemental Retirement Benefits payable u
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 ben
The Rabbi Trust may be maintained and administered to also provide for the funding of payment of amounts payable to participants in oth
benefit plans of the Company. The funding, investments and administration of the Rabbi Trust in connection with such other separate plan or plan
administered and accounted for as determined to be necessary and appropriate by the Company and trustee pursuant to the terms of the Rabbi Tru
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 T
providing payments under this Plan, or any share thereof so held and administered, and any earnings thereon, shall be held separate and apart from
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 Co
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 be
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
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 Co
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 a
to continue
- 32 - -
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 o
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 P
Participant’s employment with the Company, or any subsidiary of the Company, for any reason, whether by action of the Company, subsidiary, or s
B Participant, shall immediately terminate such Participant’s participation in the Plan and any such Participant’s Plan Agreement, and all further obl
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 Agre
collectively, by their terms or implications constitute an employment contract of any nature whatsoever between the Company, or any subsidiary, a
Participant.
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 Agree
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 l
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
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 t
partially, from time to time, and at any time. The Company likewise reserves the right to amend, modify, or supplement any written instrument made
administration of the Plan, or any Plan Agreement, wholly or partially, from time to time. Such right to amend, modify, supplement, or terminate the
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 m
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
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 i
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 th
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 P
and upon the expiration of such two (2) year period such surviving corporation may thereafter terminate or amend the Plan or any such substituted
Section 8.2, below.
- 33 - -
8.2 Rights and Obligations Upon Amendment, Termination. The following terms and conditions shall govern the rights and oblig
Part B Participant and the Company (including any surviving corporation in event of a Change of Ownership or Control), respectively, with respect
of the Plan.
A. Notwithstanding anything to the contrary expressed or provided in the Plan or any Plan Agreement of a Part A Par
amendment, modification or termination of the Plan, shall decrease a Part A Participant’s or Part B Participant’s accrued Excess Retirement
Retirement Benefit, as applicable. For purposes of this Paragraph A., a Plan amendment which has the effect of decreasing a Part A Partici
accrued Excess Retirement Benefit or Supplemental Retirement Benefit, as the case may be, or eliminating any optional form of payment of
Retirement Benefit or Supplemental Retirement Benefit, with respect to benefits attributable to service before the amendment shall be treat
Excess Retirement Benefit or Supplemental Retirement Benefit. If a vesting schedule under the Plan or any Plan Agreement is amended, a P
Participant’s non-forfeitable percentage, determined as of the later of the date such amendment is adopted or the date it becomes effective
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, o
Agreement of a Participant, in accordance with the provisions for such termination, neither the Plan nor the Plan Agreement shall be of an
party shall have any further obligation under either the Plan or any Plan Agreement so terminated, except as provided in the Plan or Plan A
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 substitute
event of a Change of Ownership or Control as described in Section 8.1, above, and the terms “Excess Retirement Benefit” and “Supplemen
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
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 E
and, except as may be otherwise expressly provided for, the Plan and Plan Agreements entered into hereunder shall supplement and shall not super
other Plan, plan or agreement of the Company. The Excess Retirement Benefits and Supplemental Retirement Benefits under the Plan and/or Plan A
hereunder shall not be considered compensation for
- 34 - -
the purpose of computing contributions or benefits under any plan maintained by the Company, or any of its subsidiaries, which is qualified under
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, alien
encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge the same shall be void. No Excess Retirem
Retirement Benefit under the Plan or under any Plan Agreement shall in any manner be liable for or subject to the debts, contracts, liabilities, or tor
thereto. If any Part A Participant or Part B Participant under the Plan or a Plan Agreement should become bankrupt or attempt to anticipate, alienat
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, cea
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,
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 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
(v) a Change in Ownership or Control, or
(vi) the occurrence of an Unforeseeable Emergency.
B. Notwithstanding the foregoing, in the case of a Participant who is a Specified Employee, no distribution shall be ma
(6) months after the date of the Participant’s Separation from Service, or, if earlier, the date of death of such Participant.
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C. No acceleration of the time or schedule of any distribution or payment under the Plan shall be permitted or allowed
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 pay
payment of Compensation deferred under the Plan, such Subsequent Election shall not take effect until at least twelve (12) months after th
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 pu
upon a Change in Ownership or Control, the first payment with respect to which such Subsequent Election is made shall be deferred for a
years from the date such payment would otherwise have been made; and any such Subsequent Election related to a payment at a Specifie
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 acco
the Plan or any Plan Agreement executed hereunder shall, to the extent thereof, be in full satisfaction of all claims hereunder against the Company.
Participant, legal representative, or Beneficiary, as a condition precedent to such payment, to execute a receipt and release therefore in such form as
11.3 No Guarantee of Interests. Neither the Committee nor any of its members guarantees the payment of any amounts which may
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 an
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 ther
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, aff
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
States mail, postage prepaid. If notice is to be given to the Company, such notice shall be addressed to the Company at:
100 West Fifth Street
Tulsa, Oklahoma 74103
- 36 - -
and marked to the attention of the Secretary, Executive Compensation Committee; or, if notice to a Participant, addressed to the address shown on
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
11.8 Effect of Provisions. The provisions of the Plan and of any Plan Agreement executed hereunder shall be binding upon the Co
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
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
State of Oklahoma in effect at the time of their adopting and execution, respectively.
11.11 Effective Date. Except to the extent explicitly stated otherwise herein, the terms and provisions of this amended and restated Pla
2008.
ONEOK, Inc.
By:
____________________
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APPENDIX I
ONEOK, Inc. 2005 Supplemental Executive Retirement Plan
DESIGNATION AND ELECTION OF AND FOR PARTICIPANT AND PARTICIPATION AGREEMENT
(PLEASE PRINT OR TYPE) Mail to: ONEOK, Inc., Attn: David Roth, Mail Drop 18-48, P.O. Box 871, Tulsa, OK 74102
PARTICIPANT INFORMATION
Name: ___________________ Employee No._______________________
SERP Part A & B Participant Commencement Date ____________________
Marital Status at Part A & B Participant Commencement Date _________________
PART I - DETERMINATION OF ELIGIBILITY AND DESIGNATION AND SELECTION OF EMPLOYEE TO BE PARTICIPANT
__________________________(“Participant”) is hereby determined to be in a select group of management or highly compensated employees of

become and is selected to be as a Participant in the ONEOK, Inc. 2005 Supplemental Executive Retirement Plan (Plan), effective _____________, 20
___________________________ is hereby designated to be a Part A Participant in the Plan.

___________________________ is hereby designated to be a Part B Participant in the Plan.
This determination and selection is made pursuant to Sections 2.1 and 2.2 of Article II, Part A of the Plan and Sections 2.1 and 2.2 of Article II of Pa
Except as otherwise provided in this instrument and the Plan with respect to the Participant's election of a Specified Time for his/her Normal Specifi
and form of payment shall be elected and determined under the Plan and by the Company as confirmed by this instrument.
Pursuant to Section 2.4 of Article II, Part A of the Plan, Participant, as a designated Part A Participant in the Plan is determined to be entitled to and
Retirement Benefit at his/her Normal Specified Time of Distribution, as provided for under the Plan. Pursuant to Section 2.4 of Article II, Part B of th
designated Part B Participant in the Plan is determined to be entitled to and shall be paid a Supplemental Retirement Benefit at his/her Normal Speci
provided for under the Plan.
The time and form of payment designated by or for the Participant shall be effective on the date of this instrument and shall be as provided for in A
the Excess
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Retirement Benefit, and as provided for in Article III of Part B of the Plan for the Supplemental Retirement Benefit.
This determination and deferral of compensation under the Plan shall apply with respect to compensation to the deferred by or to the selected Parti
this instrument.
Date: ______________________ ____________________________

John W. Gibson
Chief Executive Officer
ONEOK, Inc.
PART II - ELECTION AND PARTICIPATION AGREEMENT
SECTION 1: BACKGROUND AND INSTRUCTIONS
Time of Payment of SERP Benefit
The ONEOK, Inc. 2005 Supplement Executive Retirement Plan (“SERP" or the “Plan”), as amended, provides that the Excess Retirement Benefit tha
Participant and Supplemental Retirement Benefit that you accrue as a Part B Participant will be paid and distributed to you at your Normal Specifie
Your Normal Specified Distribution Date is the later of (1) the Specified Time (specified calendar date) you elect to receive payment and distribution
Benefit and Supplemental Retirement Benefit, or (2) the date you (i) have attained age 50, (ii) completed 5 years of service with the Company, and (i
the Company.
For example, if at the Specified Time that you elect for payment and distribution of your Excess Retirement Benefit and Supplemental Retirement Be
the Company, your Excess Retirement Benefit and Supplemental Retirement Benefit will not be paid and distributed to you at that Specified Time, a
distributed to you when you subsequently separate from service with the Company.
Similarly, if the Specified Time you elect is later than the date you separate from service with the Company, your Excess Retirement Benefit and Sup
be paid and distributed to you at the Specified Time you elect.
You may elect a time of payment that is the date you have (i) attained age 50, (ii) completed 5 years of service with the Company, and (iii) separated
and not otherwise elect a specific other date of payment in your election.
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Time of Election of Specific Date (Time of Payment) as Your Normal Specified Distribution Date
Election of Specified Time (Time of Payment) of Excess Retirement Benefit and Supplemental Retirement Benefit
You must make an irrevocable election of the Specified Time you want to be your Normal Specified Distribution Date within thirty (30) days after th
selected to be a Part A Participant or Part B Participant in the SERP.
Subsequent Election
The SERP provides that as a Part A Participant and Part B Participant you may make a Subsequent Election to change the Normal Specified Distribu
Subsequent Election Distribution Date. The Subsequent Election is made as to the Specified Time you initially elected, or any Subsequent Election
previously elected under the Plan.
A Subsequent Election to change the Specified Time of payment of an Excess Retirement Benefit and Supplemental Retirement Benefit is subject to
that limit its effect and use.
A Subsequent Election cannot take effect until at least twelve (12) months after the date it is made, the payment of the Excess Retirement Benefit an
Benefit must be deferred for a period of not less than five (5) years from the date payment would otherwise have been paid, and the Subsequent Ele
twelve (12) months before the payment of the Excess Retirement Benefit and Supplemental Retirement Benefit is to be paid.
Because of these special restrictions and limitations, you should review your initially elected Normal Specified Distribution Date periodically and c
possible Subsequent Election to change the Specified Time you initially elect in this instrument.
You may obtain information about making a Subsequent Election from the Company Employee Benefits department.
Form of Payment of SERP Benefit
The SERP provides that if you are married at the time you commence participation as a Part A Participant and Part B Participant, your Excess Retirem
Retirement Benefit will be paid to you in the form of a 50% joint and survivor annuity.
If you are unmarried at the time you commence participation as a Part A Participant and Part B Participant, your Excess Retirement Benefit and Supp
be paid to you in the form of a single (straight) life annuity.
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As a Part A Participant and Part B Participant, you may elect to change the form of payment of your Excess Retirement Benefit and Supplemental R
actuarially equivalent annuity form of payment that is provided for under the Retirement Plan for Employees of ONEOK, Inc. and Subsidiaries if you
to commencement of payment of your Excess Retirement Benefit and Supplemental Retirement Benefit. A change only in such allowed annuity form
a Subsequent Election subject to the special rules and limitations described above for Subsequent Elections.
SECTION 2: PART A PARTICIPANT ELECTION OF NORMAL SPECIFIED DISTRIBUTION DATE
I hereby irrevocably elect as the time of payment of my Excess Retirement Benefit and Supplemental Retirement Benefit:
( Initial and date one space)
_______ _______The later of (1)_____________, or (2) the date I have (i) attained age fifty (50) , (ii) completed five (5) years of service with the
from service with the Company.
________ _______The date I have (i) attained age fifty (50), (iii) completed five (5) years of service with the Company and (iii) separated from se
I understand my election of the Specified Time stated above in this instrument is irrevocable and shall remain in effect as the time of payment of my
Supplemental Retirement Benefit unless and until I file a written Subsequent Election as to time of payment in accordance with the terms of the SER
I understand, acknowledge and agree that I elect to participate in the Plan in accordance with and subject to all terms and provisions of the Plan, an
provisions of this instrument, which shall be administered, interpreted and applied as determined by the Company and Committee under such terms
Employee’s Signature__________________________ Date_________________
Witness _____________________________________ Date_________________
SECTION 3: ONEOK USE ONLY
Received By___________________________ Date__________________
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Exhibit 10.8
ONEOK, Inc.
2005 NONQUALIFIED
DEFERRED COMPENSATION PLAN
ONEOK, Inc.
2005 NONQUALIFIED DEFERRED COMPENSATION PLAN
Table of Contents
ARTICLE I PURPOSE 1
1.1Statement of Purpose; Effective Date 1
ARTICLE II DEFINITIONS 1
2.1Definitions 1
ARTICLE III ELIGIBILITY AND PARTICIPATION 12
3.1Eligibility 12
3.2Participation 12
3.3Elections to Participate Irrevocable 12
3.4Exclusion from Eligibility 12
ARTICLE IV DEFERRAL OF COMPENSATION AND EXCESS AMOUNTS 13
4.1Amount and Time of Election to Defer 13

4.2Deferral Periods; Payment 14
4.3Committee Authority; Deferral of Compensation 15
4.4General Requirements for All Elections 15
4.5Subsequent Elections 16
4.6Crediting Deferred Base Salary and Bonus 18
4.7Crediting of Plan Excess Amounts 18
ARTICLE V PLAN EXCESS AMOUNTS 18
5.1General 18
5.2Thrift Plan Excess Employee Amount 19
5.3Thrift Plan Excess Matching Amount 19
5.4Profit Sharing Plan Excess Amount 19
5.5Retirement Plan Covered Compensation Excess Amount 19
5.6Supplemental Credit Amount 20
5.7Required Elections to Defer Excess Amounts 20
ARTICLE VI BENEFIT ACCOUNTS 20
6.1Determination of Account 20
6.2Crediting of Investment Return; Other Items to Participant Accounts 20
6.3Investment Return; Designated Deemed Investment 21
6.4Statement of Account 21
6.5Vesting of Participant Accounts 21
i
ARTICLE VII PAYMENT OF BENEFITS 22

7.1Requirements for Distributions and Payments 22
7.2Payment of Plan Benefit; Long-Term Deferrals 23
7.3Payment of Plan Benefit; Short-Term Deferrals 23
7.4Specified Employee Six (6) Month Required Delay in Distribution and Payment 23
7.5Form of Distribution and Payment 24
7.6Distribution and Payment for Subsequent Elections 25
7.7Distribution and Payment for Early Separation from Service 25
7.8Distribution and Payment of Plan Benefit Upon Disability 25
7.9Distribution and Payment of Plan Benefit Upon Death 25
7.10Payment of Deferrals for Unforeseeable Emergency 25
7.11Commencement of Distributions and Payments 26
7.12No Acceleration of Distribution and Payment 26
7.13Retirement Plan Excess Amount 27
ARTICLE VIII BENEFICIARY DESIGNATION 27
8.1Beneficiary Designation 27
8.2Amendments 28
8.3No Designation 28
8.4Effect of Payment 28
ARTICLE IX ADMINISTRATION 28
9.1Plan Committee; Authority and Duties 28
9.2Agents 30
9.3Binding Effect of Decisions 30
9.4Indemnity of Committee 30
ARTICLE X AMENDMENT AND TERMINATION OF PLAN 30
10.1Amendment 30
10.2Termination 31
ARTICLE XI PLAN EFFECT, LIMITATIONS, MISCELLANEOUS PROVISIONS 31
11.1Nature of Employer Obligation; Funding 31
11.2Trusts; Transfers of Assets, Property 31
11.3Nonassignability 32
11.4Captions 33
11.5Governing Law 33
11.6Successors 33
11.7No Right to Continued Service 33
ii
EXHIBIT A 34
EXHIBIT B 35
EXHIBIT C 36
EXHIBIT D 38
iii
ONEOK, Inc.
ARTICLE I
PURPOSE
1.1 Statement of Purpose; Effective Date
This ONEOK, Inc., 2005 Nonqualified Deferred Compensation Plan (the “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.
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 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.
The Plan is generally effective on January 1, 2005.
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 B attached
hereto. 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.
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 to the extent provided by Treasury Regulations issued under Code Section 409A, a change in the
ownership or effective control of the Corporation, or in the ownership of a substantial portion of the assets of the Corporation.
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 ONEOK, 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.
Defined Contribution Plan Excess Amounts
"Defined Contribution Plan Excess Amounts" means the excess amounts deferred by or for a Participant under this Plan with respect to
qualified defined contribution plans established and maintained by the Corporation pursuant to Article V of the 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 the election of a Participant or the Corporation for payment and distribution of Deferred Compensation to the Participant for
services performed for a Plan Year.
Eligible Employee
“Eligible Employee” means a highly compensated or management employee of the Corporation 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.
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.
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.
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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 “C” attached hereto; provided, that no Investment Return shall be credited with respect
to the Retirement Plan Excess Amount.
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 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 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.
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.
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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.
Participant
“Participant” means 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 ONEOK, Inc. 2005 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.
Profit Sharing Plan
“Profit Sharing Plan” means the Profit Sharing Plan of the Corporation.
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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 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 Retirement Plan for Employees of ONEOK, Inc. and Subsidiaries.
Retirement Plan Covered Compensation Excess Account
“Retirement Plan Covered Compensation Excess Account” means the account maintained on the books of the Employer for the purpose of
accounting for the Retirement Plan Covered Compensation Excess Amount and for the amount of investment return credited thereto for each
Participant pursuant to Article VI of the 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 ONEOK, Inc. 2005 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 (i) the limitation on annual compensation of an Employee that may be taken into account
under Code section 401(a)(17), and (ii) the limitation on contributions and other additions under Code section 415(c) multiplied by the
applicable percentage for determining the Company Contributions under the Profit Sharing Plan for the Plan Year, which amount is to be
-7--
credited to be allocated to, or recorded in and accounted for in the Account of a Participant under Section 5.5 of the Plan.
Retirement Plan Excess Amount
“Retirement Plan Excess Amount” means the additional amount payable to a Participant with respect to the Retirement Plan pursuant to
Section 7.13.
Separation from Service
“Separation from Service” means the termination of a Participant’s employment with the Corporation 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 one (1) year, 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 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).
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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 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
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.
-9--
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 Thrift Plan for Employees of ONEOK, Inc. and Subsidiaries.
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 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.
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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.
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.
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(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 are described 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).
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ARTICLE III
3.1 Eligibility
Eligibility to participate in the Plan shall be granted to 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 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.
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.
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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.
(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 B 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;
(2) deferral of at least ten percent (10%) and not more than ninety percent (90%) of the Participant’s Bonus for the
Plan Year;
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.
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(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 apply only to
the next Plan Year following such Election. Except as otherwise directed by the Committee, Participants in the Plan shall
make separate and new Elections for each 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. For compensation of
Participants in Plan Years beginning on or after January 1, 2009, 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
- 14 - -
from Service Distribution Date, except for Short-Term Deferral installment payments that have already commenced, as
described and provided fro 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 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.
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
- 15 - -
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 provided
the 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.
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.
(b) No Subsequent Election shall be allowed to be made under the Plan that does not comply with the provisions of section
409A of the Code and Treasury Regulations. A Subsequent Election may be made and effective under the Plan with
respect to the payment of deferred compensation only if the following conditions are met:
(1) Such Subsequent Election shall not take effect until at least twelve (12) months after the date on which it is
made;
- 16 - -
(2) Except in the case of an election permitted under Section 409A and the Treasury Regulations §1.409A-3(a)(2)
(payment on account of disability), § 1.409A-3(a)(3) (payment on account of death), or §1.409A-3(a)(6)
(payment on account of the occurrence of an unforeseeable emergency), the payment with respect to which
such Subsequent Election shall be deferred for a period of five (5) years from the date such payment would
otherwise have been paid (or in the case of a life annuity or installment payments treated as a single payment,
five (5) years from the date the first amount was scheduled to be paid); and
(3) Any Subsequent Election related to a payment described in Treasury Regulations §1.409A-3(a)(4) (payment at
a specified time or pursuant to a fixed schedule) shall be made not less than twelve (12) months before the date
the payment is scheduled to be paid (or in the case of a life annuity or installment payments treated as a single
payment, twelve (12) months before the date the first amount was scheduled to be paid).
(c) 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.
(d) 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.
(e) 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.
(f) 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.
(g) 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
section 409A of the Code and Treasury Regulations.
(h) 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
- 17 - -
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, provided that the Employer shall reduce the deferral amount credited by the amount of taxes,
including taxes imposed by the Federal Insurance Contribution Act (FICA) or other amounts, if any, required to be withheld by the Employer
from a Participant’s Compensation pursuant to any state, federal or local law. 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. Such amounts shall be
credited on or before the last day of the Plan Year for which they are deferred by the Participant or Corporation Election.
ARTICLE V
PLAN EXCESS AMOUNT
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 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.
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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.
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
- 19 - -
eligible to participate in the Retirement Plan, and not participating in the ONEOK, Inc. 2005 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 5.6shall 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.
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
- 20 - -
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 “D,” 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 “C” attached hereto.
To the extent the Investment Return specified in Exhibit “C” 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 Account shall be determined in like manner as the vesting of the
Participant’s accrued benefit under the Retirement Plan.
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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,
(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, in the case of a Participant who is a Specified Employee, 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) 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 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.
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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.
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.
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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.
(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.
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7.6 Distribution and Payment for Subsequent Elections
Subject to the provisions of Section 7.1, above, 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
Subject to the requirements stated in Section 7.1, above, if a Participant becomes Disabled, the Employer shall distribute and pay to the
Participant, or the Participant’s personal representative, a Plan Benefit. The payment and distribution shall be made upon the date the
Participant is determined by the Committee to be Disabled. Notwithstanding any other provisions of the Plan, a cancellation of a Participant's
Election with respect to deferral of compensation may be made by the Participant or the Committee where such cancellation occurs by the later
of the end of the taxable year of the Participant or the 15th day of the third month following the date the Participant incurs a Disability. For
purposes of this paragraph, a Disability refers to 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, where 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.
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, in the case of an Unforeseeable Emergency, 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 Plan Benefit; provided, that such a distribution
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shall not exceed the amounts necessary to satisfy the emergency involved 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). 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 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.
7.11 Commencement of Distributions and Payments
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 7.1 through 7.4, above, 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.
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.
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
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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 ONEOK, Inc., 2005 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 married at the time of the Corporation’s
Election, 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 VII
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
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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.
(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 Executive Compensation Committee of the Board 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 Executive Compensation Committee may, in its discretion, assume authority to
act upon and decide the issues and case involved, with any such action and decision by it
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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.
(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.
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(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 Agents
The Committee may appoint an individual, who may be an employee of the Corporation, to be the Committee’s agent with respect to the day-
to-day administration of the Plan. In addition, the Committee 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.
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
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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.
Written notice of any amendment or other action with respect to the Plan shall be given to each Participant.
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 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 6.2, or the timing or
method of distribution of a Participant’s Account, without the Participant’s prior written consent.
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.
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(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.
(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,
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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.
11.4 Captions
The captions contained herein are for convenience only and shall not control or affect the meaning or construction hereof.
11.5 Governing Law
The provisions of the Plan shall be construed and interpreted according to the laws of the State of Oklahoma.
11.6 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.
11.7 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.
ONEOK, Inc.
By:
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EXHIBIT A
ONEOK, Inc.
Re: Section 3.1 – Eligible Employees
Effective Date: December 18, 2008
Except as otherwise specifically determined by the Committee, the Committee has determined that the Chief Executive Officer of the
Corporation is and shall in all cases be an Eligible Employee, and other Eligible Employees who may participate in the Plan shall be designated
in writing by the Chief Executive Officer, or his designee, each Plan Year during the period after November 1 and prior to the next January 1
(“Designation Period”), with such designation to indicate the Eligible Employees for the Plan Year next following such Designation Period who
shall be each Employee who (i) had Base Salary on November 1 of that Plan Year, which places such Employee in the group of Employees
consisting of the top two percent (2%) of the Employees when ranked on the basis of Base Salary, (ii) is either an Officer of the Corporation or
a highly compensated employee as defined in Code section 414(q), and (iii) is so designated by name in writing in an instrument signed by the
Chief Executive Officer of the Corporation, or his designee. The designation of Eligible Employees for a Plan Year shall be reported to the
Committee and Board in accordance with their directions.
An Employee must be an Eligible Employee prior to the beginning of a Plan Year in order to participate in the Plan for such Plan Year, unless
otherwise determined by the Committee.
A list of the Eligible Employees who are so designated and approved for a Plan Year shall be made by the Chief Executive Officer, or his
designee, the Committee, or by a duly authorized representative of the Committee, and be maintained with the Plan in the records of the
Corporation.
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EXHIBIT B
ONEOK, Inc.
Re: Section 4.1 – Amount of Deferral
Effective Date: December 18, 2008
As of the date above, and effective until this Exhibit is modified by the Committee and Board, the table below indicates the types of
compensation that are eligible for deferral by and in an Election of a Participant or the Corporation at the designated percentages stated:
Minimum Percentage Maximum Percentage That May Be

Type of Compensation That Must Be Deferred Deferred
Base Salary 2% *90%
Bonus (or the portion above a specified threshold) 10% *90%
Percentage That
Type of Compensation Must Be Deferred
Qualified Employer Plan Amounts 100%
Supplemental Credit Amounts 100%
A Participant may defer Base Salary or Bonus only in 1% increments thereof.
*The Participant’s deferral shall be after deductions and withholding of amounts applicable to deferrals made by the Participant pursuant to
other employee benefit plans of the Employer under Code Sections 125 and 401(k), and after deduction and withholding of all income and
employment taxes required, as determined by the Committee and Employer, under uniform rules and procedures.
- 35 - -
EXHIBIT C
ONEOK, Inc.
Re: Section 2.1 – Investment Return
Date: December 18, 2008
A. Long-Term Deferrals
The Investment Return on a Participant’s Account for Long-Term Deferrals shall be the rate determined pursuant to the following:
1. A Participant shall designate in writing to the Committee or its designee such deemed investments of the amount or amounts
of his/her Account that are Long-Term Deferrals in the manner and form, and at such times as prescribed by the Committee.
2. Unless otherwise determined in written action of the Committee that is described in a written explanation furnished to
Participants prior to it becoming effective, the Plan shall provide for an Investment Return on Long-Term Deferrals based
upon the notional or deemed investments directed from time to time by the Participant of his or her Long-Term Deferrals in
one or more of the investment options then being provided for participant directed investments under the Thrift Plan and
Profit Sharing Plan. The Committee and its designees shall establish administrative procedures for allowing Participant
direction of deemed investment and the determination of the Investment Return thereon for Long-Term Deferrals of
Participants.
3. A Participant shall be allowed to change such designation at least once each calendar quarter, or more frequently as
determined by the Committee, in its sole discretion. Such Investment Return shall be determined and calculated in the
manner determined by the Committee, in its sole discretion, and added to or deducted from the amount or amounts of his/her
Account that are Long-Term Deferrals periodically, not less frequently than annually. Such Investment Return Rate shall be
so credited to or deducted from the amount or amounts of a Participant’s Account that are Long-Term Deferrals until all
payments with respect thereto have been made to the Participant, or to the Participant’s designated Beneficiary pursuant to
the Plan. The Employer shall not be liable or otherwise responsible for any decrease in a Participant’s Account because of
the investment performance resulting from application of the foregoing provisions which make the Investment Return on the
amount or amounts of a Participant’s Long-Term Deferrals under the Plan equivalent to the investment return that is realized
by deemed investment of the Participant’s Long-Term Deferrals in his or her Account in Thrift Plan or Profit Sharing Plan
investment options designated by the Participant.
- 36 - -
Notwithstanding the foregoing, the Employer shall not be required to actually invest amounts deferred by a Participant nor
the Account of any Participant in any particular form, type or amount of investment, and no Participant shall have the right
to direct or in any manner control the actual investments, if any, made by the Employer or any other person for purposes of
providing funds for paying the liabilities of the Employer for benefits or otherwise under the Plan; and a Participant shall not
have any ownership or beneficial interest in any such actual investments that may be made by the Employer. In no event
shall any Participant or Beneficiary have a right to receive an amount under the Plan other than that of a general unsecured
creditor of the Employer notwithstanding the foregoing provisions with respect to the measurement and determination of a
Participant’s Investment Return on his/her Long-Term Deferrals in his or her Account by reference to the performance of
deemed investments in Thrift Plan or Profit Sharing Plan investment options designated by the Participant.
4. A Participant shall be entitled to elect to have the Investment Return credited to and deducted from Long-Term Deferrals in
his or her Accounts under the Plan. A Participant shall make an Election of such Investment Return at the time and in the
manner prescribed by the Committee.
B. Short-Term Deferrals
For amounts deferred by a Participant as a Short-Term Deferral, the Investment Return will be the Five-Year Treasury Bond Rate as of
the first business day of January of the Plan Year; provided, that the Corporation may determine such other Investment Return as it
selects from time to time, in its discretion.
- 37 - -
EXHIBIT D
ONEOK, Inc.
Re: Section 6.2 – Crediting and Debiting of Investment Return,

Other Items To Participant Accounts
Date: December 18, 2008
A. 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 of the Plan.
B. Except as otherwise provided herein, the Account shall be credited and debited with Investment Return and losses, if any, not less
frequently than on a monthly basis after such Accounts have been adjusted for any deferrals, credits, debits, distributions and
payments.
C. A Participant’s Accounts will be charged with cost of any deemed purchases of securities and credited with proceeds of any deemed
sales of securities which may be considered as made in respect to the Investment Return specified in Exhibit “C” of the Plan by
reason of changes in deemed investments designated by such Participant, in substantially the same manner as would occur if such
securities were being purchased or sold by a Participant under the Thrift Plan and/or Profit Sharing Plan. The Committee may, in its
sole discretion, allocate, charge and credit other items and amounts to such deemed purchases and sales in a manner comparable to
the administration of such items under the Thrift Plan and/or Profit Sharing Plan, as determined applicable.
D. All of a Participant’s deferrals of Base Salary in a calendar month shall be deemed to be made as of the date it otherwise would have
been paid to the Participant.
E. A Participant deferral of Bonus will be credited and debited with Investment Return from the date of deferral.
F. Until a Participant or his or her Beneficiary receives his or her entire account, the unpaid balance thereof shall be credited and debited
with Investment Return as provided in Section 6.2 of the Plan.
G. A Retirement Plan Excess Amount shall be determined, taken into account and made payable to a Participant as determined by the
Committee in accordance with Section 7.13 of the Plan.
- 38 - -
Exhibit 10.9
ONEOK, INC.
DEFERRED COMPENSATION PLAN
FOR
NON-EMPLOYEE DIRECTORS
Amended and Restated as of December 18, 2008
ARTICLE I
ESTABLISHMENT OF PLAN
The Board of Directors of ONEOK, Inc., an Oklahoma corporation (the "Company"), on January 15, 1998, established this ONEOK,
Inc. Deferred Compensation Plan for Non-Employee Directors (the "Plan), a non-qualified deferred compensation plan pursuant to which any
Director of the Company who is not an officer or present employee of the Company, and who is in a position to contribute to its continued
growth, development and future financial success, may be offered an opportunity to defer all or a portion of his/her compensation under terms
and conditions that will represent a meaningful benefit to such Director.
The Plan is amended and restated according to the terms stated herein, effective December 18, 2008, and all deferred amounts shall be
subject to the terms hereof.
ARTICLE II
PURPOSE
The purpose of the Plan is to improve the Company's ability to attract and retain Non-Employee Directors who will contribute to the
overall success of the Company.
ARTICLE III
DEFINITIONS
"Beneficiary" shall mean any person designated by a Participant on a form furnished by the Plan Administrator.
"Board" shall mean the Board of Directors of the Company.

"Cash Deferral Option" shall mean the deferral option specified in Article IX 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 of the Company.
"Common Stock" shall mean the $0.01 par value Common Stock of the Company.
"Company" shall mean ONEOK, Inc., an Oklahoma corporation, or any successor thereto.
"Deferred Compensation" shall mean Director Compensation that is deferred by a Non-Employee Director pursuant to this Plan.
"Deferred Compensation Account" shall mean the deferred compensation account created by the Company which is payable to a
participating Non-Employee Director under the Plan.
"Deferred Compensation Agreement" shall mean a written agreement to defer compensation as described in Article VII of the Plan.
"Determination Date" shall mean the last day of a Participant's term of service as a Non-Employee Director.
"Director" shall mean a member of the Board of Directors of the Company.
"Director Annual Cash Retainer Fee" shall mean an annual retainer fee paid in cash by the Company to a Non-Employee Director for
service in or for a Plan Year.
"Director Annual Stock Retainer Fee" shall mean an annual retainer fee paid in Common Stock by Company to a Non-Employee
Director for service in or for a Plan Year.
"Director Board Meeting Fee" shall mean a per meeting fee paid by the Company to a Non-Employee Director for service and
attendance at a Board meeting.
"Director Committee Chair Fee" shall mean a fee paid by the Company to a Non-Employee Director for service as the chairperson of a
committee of the Board in or for a Plan Year.
"Director Compensation" shall mean the compensation paid or payable to an individual for his/her services as a Non-Employee
Director.
“Director Retainer Fees” means the Director Annual Cash Retainer Fee and Director Annual Stock Retainer Fee.
"Director Services Fee" shall mean such other fees or compensation as the Company may pay to a Non-Employer Director in lieu of or
in addition to Director Retainer Fees, Director Committee Chair Fees and Director Board Meeting Fees.
"Disabled" and/or "Disability" 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 any employer by whom such participant is
employed. A Participant will be deemed to be
2
Disabled if such Participant is determined to be totally disabled by the Social Security Administration.
"Distributable Balance" shall mean the balance of a Participant's Deferred Compensation Account on the Determination Date as
provided in paragraph XI of the Plan.
"Distribution Date" shall mean the date on which distribution of amounts distributable to a Participant under the Plan and Deferred
Compensation Agreement is to be made and/or commenced.
"Dividend Reinvestment Plan" means the dividend reinvestment plan established and maintained by or for the Company with respect
to Common Stock.
"Election" shall mean an irrevocable written election to defer compensation made by a Non-Employee Director pursuant to the Plan
that shall specify the Specified Time of Distribution and Specified Form of Distribution of Deferred Compensation.
"Employee" shall mean an individual who is employed by the Company or any subsidiary or affiliate thereof.
"Equity Compensation Plan" shall mean the ONEOK, Inc. Equity Compensation Plan.
"Fair Market Value" shall mean on a particular date the average of the high and low sale prices of a share of 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.
"Fixed Schedule" shall mean 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
Company under the Plan.
"Investment Return Rate" shall mean the deemed investment rate of return to be credited to a Participant's Deferred Compensation
Account pursuant to Articles X and XI of the Plan.
"Long-Term Incentive Plan" shall mean the Long-Term Incentive Plan of the Company.
"Non-Employee Director" shall mean any director of the Company who is not also an employee of the Company.
"Participant" shall mean any Non-Employee Director of the Company who elects to defer compensation under the Plan.
"Phantom Stock Option" shall mean the deferral option specified in Article IX of the Plan.
3
"Plan" shall mean this ONEOK, Inc. Deferred Compensation Plan for Non-Employee Directors as set forth in its entirety in this
document as it may be amended from time to time.
"Plan Administrator" shall mean the Executive Compensation Committee of the Company's Board of Directors or any other committee
appointed by the Board of Directors to act in that capacity.
"Plan Year" shall mean the calendar year.
"Section 409A" shall mean section 409A of the Internal Revenue Code of 1986, as amended.
"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).
"Specified Employee Effective Date" shall mean the first day of the fourth month following the Specified Employee Identification
Date.
"Specified Employee Identification Date" shall mean December 31.
“Specified Form of Distribution” shall mean a specified form of distribution of Compensation deferred that is deferred by a
Participant’s Election and Deferred Compensation Agreement.
"Specified Time" shall mean 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" shall mean a Specified Time at which Deferred Compensation that is deferred by a Participant’s
Election and Deferred Compensation Agreement 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 Deferred Compensation is elected by the Election of a Participant.
4
"Subsequent Election" shall mean an election made by a Participant with respect to the time of distribution or payment of Deferred
Compensation under the Plan that is made at any time after the Election and Deferred Compensation Agreement that is made by the Participant
and/or the Company with respect to such Deferred Compensation, an election made by a Participant with respect to the time of distribution or
payment of Deferred Compensation under the Plan that is made at any time after the next preceding Subsequent Election, if any, that has been
made by the Participant and/or the Company with regard to such Deferred Compensation.
"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 Participant.
"Subsequent Election Specified Time of Distribution" shall mean a Specified Time that a Participant is allowed by the Committee to
elect in a Subsequent Election and that is on a Subsequent Election Specified Date.
"Taxable Year" shall mean the Plan Year commencing January 1 and ending the following December 31.
"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, including such
events and circumstances as are described 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).
ARTICLE IV
EFFECTIVE DATE
The Plan was adopted, established and initially effective January 15, 1998, and is amended and restated in its entirety in this Plan
document, effective December 18, 2008.
ARTICLE V
ELIGIBILITY
All Non-Employee Directors of the Company shall be eligible to participate in the Plan.
5
ARTICLE VI
NON-EMPLOYEE DIRECTOR COMPENSATION DEFERRAL
Non-Employee Directors of the Company are customarily paid an annual Director Compensation by the Company in the form of a
Director Annual Retainer Fee and a per meeting fee. Non-Employee Directors who chair a committee of the Board customarily also receive an
additional annual retainer for that position. The Company may from time to time pay other kinds or amounts of compensation to Non-
Employee Directors of the Company. The Plan allows the Non-Employee Directors to elect to defer all, part, or none of their Director
Compensation, and to have two (2) deemed investment options, either the Cash Deferral Option or the Phantom Stock Option, from which to
choose as more specifically provided below.
ARTICLE VII
ELECTION TO DEFER DIRECTOR COMPENSATION
A. Participant Elections. The Plan is a voluntary participation plan, pursuant to which a Non-Employee Director may make an
Election to irrevocably defer the designated portion of his/her Director Compensation for a Plan Year.
1. An Election by a Non-Employee Director to his/her Director Compensation shall be made for a Plan Year by executing and
entering into an irrevocable written Election and Deferred Compensation Agreement with the Company on or before December 31 of the
calendar year next preceding the Plan Year for which the Non-Employee Director elects to defer Director Compensation.
2. A separate irrevocable Election and Deferred Compensation Agreement shall be made for each Plan Year a Non-Employee
Director elects to defer his/her Director Compensation under the Plan; provided, however, if a Non-Employee Director has made an irrevocable
Election to defer Director Compensation under the Plan for a Plan Year, such Election and Deferred Compensation Agreement shall remain in
effect and be applicable and irrevocable for the next following Plan Year if a new and separate Election and Deferred Compensation Agreement
is not made and entered into on or before December 31 of the current Plan Year.
3. Notwithstanding the foregoing, in the initial 1998 Plan Year of the Plan, each Non-Employee Director may elect to defer
Director Compensation payable to him/her for that Plan Year by entering into a Deferred Compensation Agreement before the earlier of the
date of his receipt of payment of the compensation elected to be deferred, or February 1, 1998.
4. Any Non-Employee Director otherwise elected or appointed for the first time to the Board may elect to defer Director
Compensation by making and entering into an irrevocable written Election and Deferred Compensation Agreement within thirty (30) days after
his/her initial election or appointment to the Board that shall apply to his/her Director Compensation payable after the date of such Election
and Deferred Compensation Agreement. Any such initial Election shall be effective for the Plan Year in which it is made, and thereafter such
new Non-Employee Director shall make his/her Election to defer for subsequent Plan Years pursuant to the first grammatical paragraph of this
Article VII.
6
5. A Non-Employee Director who is to participate in the Plan and defer Director Compensation must elect the amount, if any, to
be deferred, the type of Deferral Option, and the time and form of payment, all of which are more specifically described below.
B. Company Elections. Notwithstanding the foregoing or other provisions of the Plan, the Company shall be authorized to
determine and separately determine and elect the time and the form of payment of all of certain types of Director Deferred Compensation. The
Company determination and election in such case shall be made by written action of the Committee or its designee, which shall be taken and
made no later than the Participant becomes entitled to the amount thereof by such designation and election, or if later, the time the Participant
would be required to make an election if the Participant were provided such election. The Company or Committee may in any such case
provide that a Participant shall have no right or opportunity to make any election with respect to the amount of deferral and time and form of
payment.
C. Participant Subsequent Elections. If the Plan, Company or Committee acting pursuant to and in accordance with the Plan
permits a Subsequent Election under which a delay in a time of payment or a change in form of payment of Director Compensation deferred by
a Non-Employee Director by his/her Election and Participation Agreement 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 of a Subsequent Election related to a payment to be made as elected
in an Election or any prior Subsequent Election, the first payment with respect to which such Subsequent Election is made shall be deferred for
a period of at least five (5) years from the date such payment would otherwise have been made. Any 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 the first scheduled payment
to which it relates.
ARTICLE VIII
AMOUNT OF DEFERRAL; DIRECTOR COMPENSATION DEFERRALS
A. Deferral Amounts. A Non-Employee Director who elects to participate in the Plan as a Participant thereof, may defer all, a
portion or none of the following types of Director Compensation for a Plan Year, as applicable:
1. Director Annual Stock Retainer Fee
2. Director Annual Cash Retainer Fee
3. Director Chair Retainer Fee
4. Director Board Chair Retainer Fee
5. Director Board Meeting Fee
6. Any other Director Services Fees
7
B. Designation. The deferral shall be designated in the Non-Employee Director’s Election and Participation Agreement as a
percentage of the form and amount of the type of Director Compensation to which it applies.
ARTICLE IX
DEFERRAL OPTIONS
A. Deferral Options. A Non-Employee Director who makes an Election to defer his/her Director Compensation for a Plan Year
may elect either:
1. A Cash Deferral Option; or
2. A Phantom Stock Option.
All amounts deferred are subject to the terms of the option elected. The Election shall be made as part of the Election procedure
described in paragraph VII, above.
B. Cash Deferral Option. Under the Cash Deferral Option, a participating Non-Employee Director may elect to defer the receipt
of the cash part of all or a portion of such Non-Employee Director's annual retainer and/or meeting fee. Interest will accrue at the rate defined
in paragraph X, below.
C. Phantom Stock Option
1. Under the Phantom Stock Option, prior to November 19, 1998, a participating Non-Employee Director may elect to defer all or
a portion of such Non-Employee Director's annual retainer and/or meeting fee; and/or after November 19, 1998, a participating Non-Employee
Director may elect to defer all or a portion of such fees the Director has elected to receive in shares of Common Stock under the Company's
Long-Term Incentive Plan, or Equity Compensation Plan, as applicable.
2. The electing Non-Employee Director shall receive credit for phantom "stock units" that are deemed to represent shares of
Common Stock equivalent in value to the amount deferred. The phantom "stock units" will be initially measured and calculated based upon
the Fair Market Value of the Common Stock on the date of the Non-Employee Director's Election, , or next preceding date of an available Fair
Market Value, if applicable.
3. The number of phantom "stock units" received in lieu of cash is dependent on the Fair Market Value of Common Stock on the
measurement date. The number of phantom "stock units" received in lieu of shares of Common Stock shall be equal to the number of shares
deferred.
4. "Fractional stock units" will be accounted for as non-interest bearing cash.
5. The measurement date is the regular payment date of the annual retainer, committee chair annual retainer, if applicable, and/or
meeting fee.
8
6. Dividend reinvestment attributable to such phantom "stock units" shall be credited as provided in Article X, below.
ARTICLE X
DEFERRED COMPENSATION ACCOUNT
A. General. The Company shall establish a separate "Deferred Compensation Account" for each Non-Employee Director who
becomes a Participant in the Plan and elects to defer Director Compensation under the Plan and shall credit such Deferred Compensation
Account with the Director Compensation deferred by the Non-Employee Director.
B. Interest Rate. The amount deferred under the Cash Deferral Option (including interest earned thereon) will earn interest at
the Investment Return Rate determined annually by the Committee which shall be the Moody's AAA 30-Year Bond Index on the first business
day of the Plan Year, plus 100 basis points. Interest will be credited quarterly (on the 1st day of April, July, October and January) at the
applicable Investment Return Rate.
C. Deemed Dividends. The Deferred Compensation Account of a Non-Employee Director who has elected the Phantom Stock
Option, shall have phantom or deemed "dividends" on the phantom "stock units" in his/her Deferred Compensation Account credited to such
Account in an amount equal to the dividends paid on Common Stock. The deemed dividend equivalent received will be treated in a manner
similar to the treatment of dividends under the Dividend Reinvestment Plan when a Participant therein elects to have dividends reinvested in
Common Stock, and will be deemed to be used to purchase additional phantom "stock units" representing Company's Common Stock at the
closing price of the stock on the date the Common Stock dividend is paid. Any fractional stock units will be accounted for as non-interest
bearing cash. The Deferred Compensation Account shall also be adjusted for any stock dividends, stock splits, etc. In the event the Dividend
Reinvestment Plan is modified in any way, such deemed dividends credited through this Plan will be handled in accordance with said
modification. If the Dividend Reinvestment Plan is terminated, such deemed dividends credited through this Plan will continue to be
reinvested in accordance with the provisions of the terminated Dividend Reinvestment Plan.
D. Amount of Account. The amount equal to the balance in the Deferred Compensation Account of the Participant, taking into
account all credits, shall be the amount a Participant shall be entitled to receive under the terms of the Plan; provided, that with respect to all
deferrals into phantom "stock units," including those deferrals made prior to November 19, 1998 the phantom "stock units" will be settled in
shares of Common Stock made available under the Long-Term Incentive Plan, or Equity Compensation Plan.
E. Statement of Account. The Company shall furnish or cause to be furnished to each Participant in the Plan an annual
statement of his/her Deferred Compensation Account.
9
ARTICLE XI
DISTRIBUTIONS AND PAYMENTS
A. Requirements for Distributions and Payments. Notwithstanding anything to the contrary expressed or implied herein, the
following requirements 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.
1. Any compensation deferred under the Plan shall not be distributed earlier than:
a. Separation from Service of the Participant,
b. the date the Participant becomes Disabled,
c. death of the Participant,
d. a Specified Time (or pursuant to a Fixed Schedule) specified under the Plan at the date of deferral of such compensation,
e. a change in ownership or control, or
f. the occurrence of an Unforeseeable Emergency.
2. Notwithstanding the foregoing, in the case of any Participant who is a Specified Employee, 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.
3. 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.
4. 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 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.
B. Distribution Options. By the written irrevocable Election of the Non-Employee Director t and Deferred Compensation
Agreement he/she must select one of the following forms of payment of the amount of Director Compensation deferred (and interest or
deemed dividends credited thereto) from his/her Deferred Compensation Account:
10
1. A payment in a single distribution immediately upon his/her Determination Date; or
2. Payment amounts of cash deferred in monthly installments over a specified number of years, and commencing at a time on or
after his/her Determination Date as designated by the Participant's irrevocable election; or
3. A payment of phantom stock units deferred in a single distribution of Common Stock on a Distribution Date elected by
him/her in accordance with the Plan.
C. Determination Date. The Distributable Balance in the Deferred Compensation Account with respect to any Plan Year shall
become fixed and determined at a Participant's Determination Date.
D. Distributable Balance. The Distributable Balance in the Deferred Compensation Account of a Participant for any deferrals
under the Cash Deferral Option is the cash balance of such Deferred Compensation Account at the Participant's Determination Date.
E. Determination of Distributable Balance. The Distributable Balance in the Deferred Compensation Account of a Participant for
any deferrals under the Phantom Stock Option shall be , prior to the effective date of this amendment and restatement, an amount equal to the
Fair Market Value of the phantom "stock units" in such Deferred Compensation Account at Participant's Determination Date and on or after
the effective date of this amendment and restatement, the number of shares of Common Stock equal to the number of phantom "stock units"
plus any cash amounts held in respect of fractional "stock units."
F. Valuation. At the Determination Date of a Participant, such Participant's Deferred Compensation Account Distributable
Balance for all Plan Years shall be valued. From that Determination Date forward, any remaining cash balance in the Account (i.e., balance
during the time of installment payments) shall bear interest at the Investment Return Rate and any remaining phantom "stock unit" balance
shall continue to be credited with "dividends" as provided in paragraph X above. In the event a Participant elects payment of the cash
balance of the Participant's Deferred Compensation Account Distributable Balance in installments, each installment shall be calculated by
dividing the then value of that portion of the Deferred Compensation Account which is in cash by the number of installments remaining as of
such date. To the extent the Distributable Balance is payable and distributable in shares of Common Stock of the Company, that part of the
Participant's Deferred Compensation Account that consists of phantom stock units and phantom dividends shall be payable in shares of
Common Stock which shall be issued in a single distribution to the Participants under the Company's Long-Term Incentive Plan or Equity
Compensation Plan on the Distribution Date elected by the Participant.
G. Distribution; Disability or Death of Participant. Distribution of a Participant's Distributable Balance shall commence
immediately upon the occurrence of the Disability or death of the Participant, if such event occurs prior to the Distribution Date elected by the
Participant, and such distribution shall be made in the form elected by the Participant. In such a case, the Distributable Balance in the Deferred
Compensation Account of the Participant shall be
11
determined as of the date of such event in like manner as if such event was a Determination Date for such Participant.
H. Distributions Continued. Distribution of the Distributable Balance in the form elected by the Participant shall continue in the
event of Disability or death of the Participant on or after the Distribution Date.
I. Form of Distribution; Disability. Distribution of the Distributable Balance in the form elected by the Participant shall be made
to the Participant in the event of Disability of such Participant; provided, that the Committee may, in its sole discretion, direct that such
distribution instead be made to a guardian or other representative of a Participant who is disabled.
J. Form of Distribution; Death of Participant. Each Non-Employee Director who is a Participant shall also designate a
Beneficiary to receive the unpaid balance of the value of the Participant's Deferred Compensation Account in the event of the Participant's
death prior to complete distribution of such unpaid balance of the Account. The unpaid balance shall be received in the form elected by the
Participant. If no Beneficiary is designated, then the Participant's Deferred Compensation Account shall be distributed to the estate of the
deceased Participant.
K. 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.
ARTICLE XII
NON-ASSIGNABILITY
The right of a Non-Employee Director or Beneficiary to receive payments under this Plan shall not be pledged, assigned, transferred
or subject to garnishment attachment or other legal process by creditors of such Non-Employee Director or Beneficiary.
ARTICLE XIII
ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Executive Compensation Committee of the Board, or by such other Committee as may be
appointed and designated by the Board to administer the Plan from time to time. The Executive Compensation Committee shall supervise and
direct the administration and operation of the Plan, and shall have such powers and duties as are specified in the Plan, or are otherwise
necessary and appropriate thereto. The Committee, in its sole
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discretion, may establish rules and procedures governing the administration of the Plan, and shall have the power to interpret provisions of
the Plan, and construe and determine the effect of Participant Deferred Agreements and other instruments pertaining to the Plan, and all
actions taken by the Executive Compensation Committee pursuant to the foregoing shall be binding on all Participants, Beneficiaries and other
persons.
ARTICLE XIV
FUNDING
A. Company Obligation. The amounts of compensation deferred by any Non-Employee Director under this Plan shall constitute
an unfunded and unsecured promise by the Company to pay such Non-Employee Director the deferred compensation from the general assets
of the Company in the future.
B. Nonqualified Trust. Although the Company may make, in its sole discretion, investments for the purpose of providing funds
to pay such unsecured obligations made by it to the Plan, any such investments shall remain the sole and exclusive property of the Company
subject to claims of its creditors generally; provided, that the Company may, at its option, create a grantor or rabbi trust to pay part or all of its
obligations under the Plan as it determines to the extent permissible without changing the unfunded and unsecured nature of its deferred
compensation obligations to Participants under the Plan.
ARTICLE XV
STATE LAWS GOVERNING PLAN
This Plan shall be governed by the laws of the State of Oklahoma.
ARTICLE XVI
AMENDMENT OR TERMINATION OF PLAN
This Plan shall continue in effect until amended or terminated by the Board of Directors. Any such amendment or termination shall
not adversely affect any Deferred Compensation Account of a Participant then in existence under the Plan or any rights of a Participant under
a Deferred Compensation Agreement entered into with a Participant prior to such amendment or termination.
Amended and Restated the 18th day of December, 2008.
ONEOK, Inc.
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Exhibit 10.44
ONEOK, INC.
EQUITY COMPENSATION PLAN
Amended and Restated December 18, 2008
1. General
1.1 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 (b) to give the Company’s eligible Employees and
Non-Employee Directors an interest parallel to the interests of the Company’s shareholders generally.
1.2 Duration of Plan. The date of adoption and term of the Plan are as follows:
(a) The Plan was initially adopted and effective on February 17, 2005, the date of its first adoption and approval
by the Board of Directors, such adoption of the Plan having been approved by the shareholders of the Company within one (1) year
of that date, on May 19, 2005. The term of the Plan as so initially adopted and approved was until a termination date of February 17,
2015, or until sooner terminated by the Board of Directors.
(b) The Plan, as amended and restated in and by this instrument, is effective on an Effective Date of February 21,
2008, the date of its adoption and approval by the Board of Directors, provided that the shareholders of the Company thereafter
approve it within one (1) year of that date. If the Plan, as so amended and restated, is so approved by the shareholders of the
Company, it shall have an extended term and shall terminate on a termination date of February 21, 2018, or until sooner terminated by
the Board of Directors.
(c) If the Plan, as so amended and restated in and by this instrument, is not so approved by the shareholders of
the Company, the amendments thereto and this instrument shall not become effective and shall be of no force and effect, and the Plan
shall remain in effect in accordance with its written terms and provisions as initially adopted and approved.
(d) The Plan shall remain in effect until its termination date, or until the Plan is sooner terminated by the Board of
Directors, and upon its termination shall continue to be administered thereafter with respect to any Stock Incentive granted prior to
the date of such termination.
(e) In no event shall a Stock Incentive be granted under the Plan more than ten (10) years from February 21, 2008,
the date the Plan, as amended and restated in and by this instrument, is adopted.
1.3 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.
1.4 Amended and Restated Plan Document. The Plan is amended and restated in the form of this instrument effective December
18, 2008.
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 15.4 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 a “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 February 15, 2001, 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
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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
(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.
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(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 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 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.
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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 ONEOK, Inc., an Oklahoma corporation, its successors and assigns, or any division or Subsidiary thereof.
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.
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 ONEOK, Inc. Common Stock granted to a Non-Employee Director.
2.13 “Effective Date” means February 21, 2008, the date the Plan, as now amended and restated in and by this instrument, was
adopted, as described in Section 1.2, above.
2.14 “Employee” means an employee of the Company, including an officer or director who is such an employee.
2.15 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.
2.16 “Fair Market Value” on a particular date means the average of the high and low sale prices of a share of 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. 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
5
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.
2.17 “General Counsel” means the General Counsel of the Company serving from time to time.
2.18 “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.
2.19 “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 division or Subsidiary); any
violation by the Employee of any covenant not to compete with the Company (or a division or Subsidiary); any act of dishonesty by the
Employee which adversely affects the business of the Company (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 Company (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 Company (or a division
or 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 division or Subsidiary), which is hereby acknowledged,
to terminate the Employee’s employment at any time without cause.
2.20 “Non-Employee Director” means a member of the Board of Directors of the Company who is not an employee of the Company,
and who qualifies as a “Non-Employee Director” under the definition of that term in SEC Rule 16b-3.
2.21 “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 15.9.
2.22 “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.
2.23 “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.
2.24 “Participant” means 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, its divisions and subsidiaries, or Non-Employee Director, who is
6
selected by the Committee to be a Participant in the Plan and to be granted a Stock Incentive under the Plan.
2.25 “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 13.9.
2.26 “Performance Period” means the time period designated by the Committee during which Performance Goals must be met.
2.27 “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.
2.28 “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.
2.29 “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 as defined in Section 2.45), 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 15.9; and which other contingencies may include the Participant’s
depositing with the Company, 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.
2.30 “Plan” means the ONEOK, Inc. Equity Compensation Plan set forth in these pages, as amended from time to time.
2.31 “Plan Year” means the calendar year beginning on January 1 and ending the next December 31.
2.32 “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 15.9.
2.33 “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 15.9
7
2.34 “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 13.9.
2.35 “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.
2.36 “Secretary” means the Secretary of the Company.
2.37 “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.
2.38 “Section 409A” means Section 409A of the Code, and unless otherwise expressly indicated herein, all Treasury Regulations
issued under Section 409A of the Code.
2.39 “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.
2.40 “Share” or “shares” means a share or shares of Common Stock, par value $.01 per share of the Company.
2.41 “Stock” means Common Stock of the Company.
2.42 “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.
2.43 “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.
2.44 “Stock Incentive” means rights and incentive compensation granted under this Plan in one of the forms referred to and
provided for in Section 3.
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2.45 “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.
2.46 “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.
2.47 “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 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, 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 granted under the Plan shall be subject to the prohibition of
repricing of Options stated in Section 7.9; 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
9
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 five million (5,000,000) shares, subject to the provisions governing restoration of shares
stated below in Section 4.4 and the provisions for adjustment in Section 13. The maximum number of five million (5,000,000) shares authorized
consists of the three million (3,000,000) shares authorized to be issued or transferred on and after the date of initial adoption of the Plan on
February 17, 2005, as approved by shareholders of the Company on May 19, 2005, and an additional two million (2,000,000) shares authorized
to be issued and transferred by amendment of the Plan and this Section 4.1, adopted and approved by the Board of Directors on February 21,
2008, and approved by shareholders of the Company on May 15, 2008.
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);
(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 shares of Common Stock that may be issued under the Plan through the
granting of Time-Lapse Restricted Stock Incentives is two million (2,000,000);
(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 one million seven hundred thousand (1,700,000); 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.
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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 15.5, 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 15.5, 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 because of the Participant’s failure to comply with the terms and conditions of a Stock Incentive or for any other reason, 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 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; and the maximum
number of shares of Common Stock that may be issued or transferred under the Plan shall be reduced only by the number of shares actually
issued and transferred to the Participant. If a Participant pays the purchase price of shares subject to an Option or applicable taxes by
surrendering shares of Common Stock in accordance with the provisions of 7.2, the number of shares surrendered shall be added back to the
number of shares available for issuance or transfer under the Plan so that the maximum number of shares that may be issued or transferred
under the Plan pursuant to Section 4.1 shall have been charged only for the net number of shares issued or transferred pursuant to the Option
exercise.
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, its divisions and 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
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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.
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 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 13) 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
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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 15th day of the third calendar month following the date specified for payment under the Award and the Plan, and with
respect to which the 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 10, 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 10 and 11.
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 or Plan to an Employee, Participant,
officer of the Company 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 15.4.
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 12, 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
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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 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 or Plan to an Employee,
Participant, officer of the Company, 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, 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 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 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
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Committee pursuant to Section 14.1 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. If an Option is granted for a term of less than ten (10) years, the
Committee may, at any time prior to the expiration of the Option, extend its term for a period ending not later than the expiration of ten
(10) years from the date the Option was granted, and no additional consideration need be received by the Company in exchange for such
extension. 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 10 and subject to the
requirements of Section 11, an Option shall not provide for the deferral of compensation to a Participant.
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, 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 Plan is
adopted, or the date the Plan is approved by the shareholders of the Company, whichever is earlier.
7.7 Written Instrument. Each Option shall be evidenced in writing as authorized and provided for in Section 15.4. 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
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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, merger, consolidation, split-up, spin-off, combination, or exchange of shares), the terms of outstanding Stock Incentives may
not be amended to reduce the exercise price of outstanding Options or 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 without Company shareholder approval.
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
16
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 10 and subject to the
requirements of Section 11, a Stock Appreciation Right shall not provide for the deferral of compensation to a Participant.
8.5 Written Instrument. Each Stock Appreciation Right granted shall be evidenced in writing as authorized and provided in
Section 15.4.
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 be amended to reduce the exercise price of outstanding Stock Appreciation Rights or 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 without Company shareholder approval.
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
pursuant to the adoption 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 may otherwise be directed by the Committee, in its sole discretion, the payment and
distribution
17
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. Deferred Compensation Program
10.1 Establishment of Deferred Compensation Program. This Section 10 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 14.2 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;
(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
18
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 to 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.
10.2 Terms and Conditions of Stock Incentives, Awards. Stock Incentives or Awards granted under the Plan that pursuant to this
Section 10 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 11.
(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 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 11.
(b) Settlement, Payment and Transfer. A Participant electing to receive an Award of Stock Units pursuant to this
Section 10 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.
11. Compliance With Section 409A
11.1 Awards Subject to Section 409A. The provisions of this Section 11 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:
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(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
(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.
11.2 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 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, 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
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determined in accordance with paragraph (b) above or as permitted by Section 11.3, and Section 409A.
11.3 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 11.4(b), 11.4(c) or 11.4(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 11.4(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.
11.4 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 11.2 and/or 11.3, as applicable;
(e) To the extent provided by Treasury Regulations under Section 409A, a change in the ownership or control of
the Company or in the ownership of a substantial portion of the assets of the Company; 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
21
determinable at the time the compensation is deferred, as provided for in Treasury Regulations 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, to the extent that a Participant is a “Specified Employee” (as defined
in Section 409A(a)(2)(B)(i) of the Code) of the Company, no distribution pursuant to Section 11.4(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.
11.5 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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11.6 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 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.
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.
11.7 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.
11.8 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.
12. 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
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shall remain exercisable until it expires or terminates pursuant to its terms and conditions. Subject to the foregoing provisions of this Section
12, 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.
13. 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, (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, and (iv) 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;
provided that with
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respect to Incentive Stock Options any such adjustments shall comply with Sections 422 and 424 of the Code.
14. Administration
14.1 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.
14.2 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 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.
14.3 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
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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.
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 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 or Committee indemnify or otherwise
reimburse a Participant or other person for any liability incurred as a result of Section 409A.
14.4 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.
15. General Provisions
15.1 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
26
Participant pursuant to Section 15.15 is not a transfer for purposes of the foregoing provisions of this paragraph.
15.2 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.
15.3 Right to Shares. 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 assurances the General Counsel may
deem necessary or desirable to assure compliance with all applicable legal requirements.
15.4 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.
15.5 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.
15.6 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 required to withhold in connection with any Stock Incentive. Without limiting the
foregoing, the Committee may, subject to such terms and conditions as it may impose, permit or require any withholding tax obligation arising
in connection with the grant, exercise, vesting, distribution or payment of any Stock Incentive to be satisfied in whole or in part, with or
without the consent of the Participant, by having the Company withhold all or any part of the shares of Common Stock that vest or would
otherwise be distributed at such time. Any shares so withheld shall be valued at their Fair Market Value on the date of such withholding.
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15.7 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.
15.8 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.
15.9 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 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
28
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 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.
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15.10 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, and the Board of Directors and the Committee.
15.11 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.
15.12 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.
15.13 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.
15.14 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 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.
15.15 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.
16. 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 and Proposed Treasury Regulation Section 1.422A-9(b)(iv) thereunder), 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
30
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.
Amended and restated as of this 18th day of December, 2008.
By: __________________________________________
David E. Roth
Senior Vice President Administrative Services
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Exhibit 10.54
PERFORMANCE UNIT AWARD AGREEMENT

This instrument is issued as of the 15th day of January, 2009, by ONEOK, Inc., an Oklahoma corporation, (hereinafter referred to as
“Corporation”), to «Officer_Name» (hereinafter referred to as “Grantee”), an employee of the Corporation or a division or subsidiary thereof,
pursuant to the terms of the ONEOK, Inc. Equity Compensation Plan, effective February 17, 2005, (hereinafter referred to as the “Plan”).
1. Performance Unit Award. This instrument and that certain Notice of Performance Unit Award and Agreement, dated January 15,
2009, a copy of which is attached hereto and incorporated herein by reference (the “Notice of Performance Unit Award and Agreement”),
constitute evidence of the issuance and grant of a Performance Unit Award (hereinafter referred to as “Award”) of «No_of_Perf_Units»
Performance Units to the Grantee by the Corporation that shall entitle the Grantee to receive shares of the Corporation’s Common Stock
(hereinafter also referred to as “Common Stock”) or cash, all pursuant and subject to the terms, provisions, and conditions of this instrument
(including, without limitation, the conditions, restrictions and limitations stated in paragraph 5, below) and the terms and provisions of the
Plan, which are incorporated herein by reference. This instrument, when executed by the Grantee, together with the Notice of Performance
Unit Award and Agreement constitute an agreement between the Corporation and the Grantee. Notwithstanding the foregoing, should there
be any inconsistency between the provisions of this instrument and the terms and provisions of the Award stated in the resolutions and
records of the Board of Directors of the Corporation providing for the Award or provisions of the Plan, the provisions of such resolutions and
records and of the Plan shall control. The grant of such Performance Units to the Grantee shall be effective in the manner and to the extent
provided in this instrument and the Plan as to all or any part of the shares of Common Stock subject to the grant from time to time during the
period stated herein.
2. Plan. The Award is made to the Grantee pursuant to the terms and provisions of the Plan, as approved by the Shareholders of
the Corporation, which Plan provides that a specific aggregate number of shares of Common Stock of the Corporation may be issued or
transferred pursuant to Stock Incentives under the Plan. The Plan specifies the authority of the Corporation, its Board of Directors, and a
committee of the Board of Directors to select employees to be granted Stock Incentives under the Plan. The Executive Compensation
Committee of the Board of Directors (hereinafter referred to as the “Committee”) is authorized to administer the Plan with respect to this
instrument and the grant of the Award made to the Grantee pursuant to the Plan. Except where expressly stated or clearly indicated otherwise
by the terms of this instrument, all terms, words and phrases used herein shall have the same meaning and effect as stated in the Plan. The
Grantee has been provided a complete copy of the Plan with this instrument.
3. Grantee’s Agreement Concerning Award and Employment. In consideration of the Corporation’s granting of the Award of
Performance Units and entitlement to shares of Common Stock, as incentive compensation to Grantee pursuant to this instrument, the Grantee,
by acceptance thereof, and signing this instrument evidencing its terms, agrees to such terms and to continue to contribute and perform
service in the employ of the Corporation or a division or subsidiary thereof at the direction, will and pleasure of the Corporation and the Board
of
1
Directors. Provided, however, neither the foregoing agreement of the Grantee in this paragraph 3, nor any other provision in this instrument
shall confer on the Grantee any right to continue in the employ of the Corporation (or a division or Subsidiary thereof), or interfere in any way
with the right of the Corporation (or such division 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 Corporation
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 date of the grant; 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 instrument 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 of Performance Units 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 Award
during the period beginning January 15, 2009, the date of the grant thereof (hereinafter referred to as “Grant Date”) and ending on January 15,
2012, (which period is hereinafter referred to as “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, at the expiration of the Performance Period as provided for in Exhibit A and Exhibit B, attached hereto, based upon the
Corporation’s ranking for Total Stockholder Return in the ONEOK Peer Group listed in Exhibit C attached hereto, all as determined by the
Committee, in its sole discretion.
(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 fractional 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 Corporation to the Grantee at the expiration
of the Performance Period, or as soon a 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 15th day of the third
month after the date of expiration 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
2
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 Corporation to the Grantee at the specified time and in accordance with the method of
payment, distribution and transfer that is elected in 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 Corporation, or otherwise have any right
or interest as a Common Stock shareholder by reason of the Performance Unit Award granted under the Award during the Performance Period,
and prior to the actual transfer of Common Stock to the Grantee pursuant to the Award.
(f) No dividends or any similar amounts shall be payable or paid with respect to Performance Units, Common Stock earned
under the Award, or the Award during or for the Performance Period.
(g) The Grantee shall have no right to receive cash or acquire shares of Common Stock of the Corporation under the
Award other than the cash and Common Stock attributable to the Performance Units earned by the Grantee to the extent provided for herein.
(h) 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 expiration 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 expiration of the Performance Period,
as determined and directed by the Committee, in its sole discretion.
(i) 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
Award and the Plan until the expiration of the Performance Period and payment and transfer of Common Stock or cash pursuant to the
Agreement and Plan.
(j) 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 Corporation 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 6(d), below.
(k) If the Grantee’s employment with the Corporation (or a division 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; and the Grantee shall forfeit such right, title and interest in the Performance Units regardless of the reason
for such termination of employment. Any such
3
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 Corporation and any division or Subsidiary of the Corporation. 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 and Award 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 (hereinafter referred to as "Election
Date") described in paragraph 6(b), below, a signed written irrevocable election (hereinafter referred to as "Election") which shall be in the form
substantially the same as attached hereto as Exhibit D, attached hereto, or as otherwise prescribed by the Committee.
(b) An Election of the Grantee 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 filed by the Grantee with the Committee on or before the Election
Date, which shall be July 15, 2011, the date that is six (6) months before the end of the Performance Period, provided that the Grantee performs
services for the Corporation 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 make an
Election 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
Corporation, or (B) a specified calendar date, or (ii) the date of the Grantee's separation from service with the Corporation; and may elect to
have payment made in a specified form of payment that shall be either (i) a single lump sum payment, distribution
4
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 Award 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 Performance Units during the
Performance Period. This instrument 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 Corporation any applicable federal, state, or local income, employment,
social security, Medicare, or other withholding tax obligation arising in connection with the grant of the Award to the Grantee; and the
Corporation 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 Market Value (as defined in the Plan) on the date of such withholding. The Grantee, with the consent of the Corporation,
may satisfy such withholding tax by delivery and transfer to the Corporation 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.
(e) The provisions of this instrument 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 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.
(f) Notwithstanding anything otherwise provided under the Plan or in the Award Agreement and Award, 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 at the Grantee's election
or the Corporation'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 section 409A of the Internal Revenue Code of 1986, as amended
("Code"), but in all events any deferral of the payment, distribution, transfer or issuance of Performance 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 under the Plan shall not be distributed earlier than
5
(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,
(3) If the Grantee is a Specified Employee, 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 instrument shall not permit a subsequent election unless authorized and agreed upon in writing by the Corporation
and Grantee, and if the Plan or this instrument 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 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 and this instrument 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 Corporation, or in the ownership of a substantial portion of the assets of the
Corporation, which shall be if (i) a Person acquires more than 50% of the Corporation’s stock; (ii) a Person acquires during a 12-month period
at least 30% (or a higher percentage specified under the Plan) of the Corporation’s stock; (iii) a majority of the members of the Board of
Directors of the Corporation 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 Corporation’s assets.
6
(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 instrument 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 or the
Grantee or the Corporation.
(iv) "Specified Employee" means a key employee (as defined in Code section 416(i) without regard to paragraph (5) thereof)
of the Corporation.
(v) "Specified Time" means a specified date at which deferred compensation deferred by or for the Grantee pursuant to this
instrument 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
7
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 anything to the contrary expressed or implied herein (including without limitation, the restrictions
stated in paragraph 5, above, applicable to the Performance Units), 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 Corporation (or a division 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
Corporation (or a division 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 Corporation (or a division 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 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 under the Award 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 expiration of the Performance Period and following application of the performance
criteria as provided in the Award and determined by the Committee.
(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 instrument, "Retirement" shall mean a voluntary termination of employment of
the Grantee with the Corporation and/or a division or subsidiary thereof by the Grantee if at the time of such termination of employment the
Grantee
8
has both completed five (5) years of service with the Corporation and/or a division or subsidiary thereof and attained age fifty (50); 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
Section 22(e) of the Internal Revenue Code of 1986, as amended (or corresponding section of any future federal tax code), and regulations
thereunder.
8. Administration of Performance Unit Award. The grant of the Award 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 instrument, 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 Corporation any applicable federal, state, or local income, employment, social security, medicare, or other
withholding tax obligation arising in connection with the grant of the Award to the Grantee; and the Corporation 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 (as defined in the Plan) on the date of such withholding. The Grantee, with the consent of the Corporation, may satisfy such withholding
tax by delivery and transfer to the Corporation 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 Corporation 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 Corporation, there shall be added to the number of
Performance Units provided for under the Award and stated in paragraph 1 of this instrument, 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 instrument (including, without limitation, the
terms and conditions stated in paragraph 5, above), and in making such adjustments, no fractional units, shares, or scrip certificates in lieu
thereof, shall be granted or issuable by the Corporation, 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.
9
(b) In the event of an increase in the outstanding shares of Common Stock of the Corporation, effectuated for the purpose
of acquiring properties or securities of another corporation or business enterprise, there shall be no increase in the number of Performance
Units which are the subject matter of the Award under this instrument 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 Corporation
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 instrument, 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 instrument (including, without limitation, the restrictions stated in paragraph 5, above), 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 Corporation, 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 date of the grant of the Award hereunder
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 Corporation in writing, to remain in the employ
of the Corporation or a division or subsidiary of the Corporation at least through the date which is six (6) months after the date the grant was
made 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
Corporation 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 Corporation, 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 Corporation 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 which may be made from time to time in the future
pursuant to the provisions of the Plan, with any amended definition of such term to apply to all events thereafter coming within the amended
meaning.
10
10. Required Grantee Repayment/Reduction Provision. Notwithstanding anything in the Plan, the Award or this instrument to the
contrary, all or a portion of the Award made to the Grantee under this instrument is subject to being called for repayment to the Corporation
or reduced in any situation where the Board of Directors of the Corporation or a Committee thereof determines that fraud, negligence, or
intentional misconduct by the Grantee was a contributing factor to the Corporation having to restate all or a portion of its financial
statement(s). The Committee may determine whether the Corporation 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 Corporation , (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
Corporation'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 Corporation. The Grantee, in consideration of the grant of the Award, and by the Grantee's execution of this
instrument, acknowledges the Grantee's understanding of and 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 Corporation
or Committee to effect its terms with respect to the Grantee, the Award and/or any other compensation described herein.
11. Stock Reserved. The Corporation 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 instrument, and shall pay all original issue taxes, if any, on the transfer of Common Stock to the Grantee, and all other fees and
expenses necessarily incurred by the Corporation in connection therewith.
12. Rights of Shareholder. Except as otherwise provided in the Award and this instrument, the Grantee shall have no rights as a
shareholder of the Corporation 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 under the Award, and Common Stock is actually
issued and transferred to the Grantee.
13. Entire Agreement. This instrument contains the entire terms of the Award, and may not be changed orally or other than by a
written instrument issued and approved by the Corporation pursuant to the Plan. This instrument supersedes any agreements or
understandings that may previously have existed, and there are no other agreements or understandings, relating to its subject matter.
11
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 instrument, the Notice of Performance Unit Award and a copy of the Plan, and
accepts the Award under the terms and conditions stated in this instrument, subject to all terms and provisions of the Plan, by signing this
instrument in duplicate originals, as of the date first above written.
& 1 6 0 ;
Date «Officer_Name»
Grantee
12
Exhibit A
Performance Units Criteria
2009-2012 Performance Period
Total Stockholder Return (TSR):vs. ONEOK Peer Group
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 25th percentile 0%
IF ONEOK’s TSR ranking at the end of the performance period is between the stated percentile levels in the above table, the percentage of the
performance units earned will be interpolated between the earning levels. No Performance Units are earned if ONEOK’s TSR ranking at the
end of the performance period is below the 25th percentile
Exhibit B
Illustration of Hypothetical 2009-20012 Performance Period
Performance Unit Award Calculation
Illustration assumes 1,000 Performance Units Granted in January 2009
Total Stockholder Return (TSR) vs. ONEOK Peer Group
Hypothetical 2007-2010 ONEOK TSR Ranking = 40th percentile
A 40th percentile TSR ranking earns 80% of Performance Units granted (i.e., 1,000 units)
as interpolated between 50% and 100% from Table A (see chart below)
800 units earned
Total Performance Units Earned
TR 800 Performance Units
800 performance units earned out of 1,000 units granted = 80.0% “earn-out” [80% (1,000 shares) paid and distributed in the form of Common
Stock as provided in section 5.c.]
Exhibit C
ONEOK PEER GROUP – 2009
Company Name Sym
AGL Resources Inc. ATG

ATMOS Energy ATO
CenterPoint Energy Inc. CNP
DCP Midstream Partners LP DPM
Enbridge Inc. ENB
Energy Transfer Partners LP ETP
Enterprise Prods Prtner LP EPD
Kinder Morgan Energy LP KMP
OGE Energy CP OGE
National Fuel Gas Company NFG
New Jersey Resources Corp NJR
NICOR Inc. GAS
NiSource Inc. NI
ONEOK, Inc. OKE
Piedmont Natural Gas Company PNY
SEMPRA Energy SRE
Southern Union Company SUG
Southwest Gas Corporation SWX
Spectra Energy Corporation SE
Teppco Partners LP TPP
Transcanada Corporation TRP
UGI Corporation UGI
Vectren Corporation VVC
WGL Holdings Inc. WGL
Wisconsin Energy Corp WEC
Exhibit D
ONEOK, INC. EQUITY COMPENSATION PLAN
PERFORMANCE UNIT AWARD AGREEMENT
DEFERRAL ELECTION
This Election is made by the undersigned Grantee pursuant to that certain Performance Unit Award granted to me under the ONEOK, Inc.
Equity Compensation Plan, on the 15th day of January 2009, a copy of which is attached hereto (the "Award").
This Election is made on or before the date of July 15, 2011, which is six (6) months before the end of the Performance Period on January 15,
2012.
I hereby irrevocably elect to defer the payment, distribution and transfer and my receipt of all Performance Units, Common Stock and cash that
I may earn and become entitled to receive from the regularly scheduled time of payment, distribution and transfer provided for in Section 5(d)
of the Award, until a later date as follows:
A. Election of Specified Time of Payment
(Initial one election of time of payment)
___ I elect to have all Common Stock, cash or other compensation which I earn or become entitled to receive under the Award and
Award Agreement deferred and paid, distributed, transferred and issued to me on the later of (i) the date of my separation from service as an
employee of the Corporation , or (ii) _________________, 20__ in the form specified below.
___ I elect to have all Common Stock, cash or other compensation which I earn or become entitled to receive under the Award and
Award Agreement deferred and paid, distributed, transferred and issued to me on the date of my separation from service as an employee of the
Corporation.
B. Election of Form of Payment
(Initial one election of form of payment)
___ I elect to receive payment, transfer and distribution of all Common Stock, cash or other compensation which I earn or become
entitled to receive under the Award or Award Agreement in a single lump sum payment.
____ I elect to receive payment, transfer and distribution of all Common Stock, cash or other compensation which I earn or become
entitled to receive under the Award or Award Agreement in ______(specify 2, 3, 4 or 5) equal annual installments commencing on the
specified date of payment elected above, and thereafter on each anniversary thereof until fully paid and transferred. The number of shares of
Common Stock or cash received in each installment will equal the number and amount that have not been settled, paid, transferred and
distributed (as of the date immediately preceding the installment payment date) divided by the number of installments remaining to be paid (as
of the date immediately preceding the installment payment date) rounded down to the next whole number except that the final installment shall
be rounded up to the next whole number.
C. Election for Death Prior to Specified Time of Payment (Put initials by your choice)
___ In the event of my death prior to the Specified Time of Payment that I have elected above, I elect to have my named beneficiaries
receive payment and transfer of the Common Stock, cash or other deferred compensation in a single lump sum within 60 days following my
death.
___ In the event of my death prior to the Specified Time of Payment that I have elected above, I elect to have my named beneficiaries
receive payment and transfer of the Common Stock, cash or other deferred compensation be paid and transferred in ______ (specify 2, 3, 4 or
5) equal annual installments commencing within 60 days following my death, and thereafter on each anniversary of the commencement date
until fully paid and transferred. The number of shares of Common Stock or cash received in each installment will equal the number and amount
that have not been paid (as of the date immediately preceding the installment payment date) divided by the number of installments remaining
to be paid (as of the date immediately preceding the installment payment date) rounded down to the next whole number except that the final
installment shall be rounded up to the next whole number.
D. Election for Death After Specified Time of Payment (Put initials by your choice)
___ In the event of my death after the Specified Time of Payment elected above, I elect to have my named beneficiaries receive payment
and transfer of the Common Stock, cash or other deferred compensation in a single lump sum within 60 days following my death.
___ In the event of my death after the Specified Time of Payment that I have elected above, I elect to have my named beneficiaries
receive payment of any remaining Common Stock, cash or other compensation in accordance with the installment schedule elected above.
E. Designation of Beneficiary (List each beneficiary and percentage)
I designate the following individuals (entities) as my beneficiaries to receive the following share(s) of my Common Stock, cash or other
deferred compensation, as indicated below:
Name of Beneficiary ; Percent

_______________________________________ __________
_______________________________________ __________
_______________________________________ __________
_______________________________________ __________
_______________________________________ __________
100% (total must equal 100%)
F. Change in Ownership or Control
Notwithstanding the foregoing, immediately following a Change in Ownership or Control the Common Stock, cash or other deferred
compensation that have not been paid and transferred will be paid and transferred. In the event shares of Common Stock no longer exist at the
time of payment and transfer, each of the deferred Performance Units shall be converted in a manner that is consistent with the manner in
which shareholders of Common Stock were treated with respect to the Change in Ownership or Control.
Solely for purposes of this election, a “Change in Ownership or Control” shall mean and shall have occurred if one of the following has
occurred: A person acquires more than 50% (or a higher percentage specified under the Plan) of the Corporation’s stock; a person acquires
during a 12-month period at least 30% (or a higher percentage specified under the Plan) of the Corporation’s stock; a majority (or a higher
percentage specified under the Plan) of the members of the Board of Directors of the Corporation are replaced during a 12-month period; or a
person acquires during a 12-month period at least 40% (or a higher percentage specified under the Plan) of the gross fair market value of the
Corporation’s assets.
Made and executed by me as Grantee of the Award pursuant to the terms and provisions of Section 6 thereof, on this _______day of
______________, 20___.
_____________________________________
Grantee
Received this ____day of ____________, 20___,
______________________________________
For the Committee
Exhibit 10.55
RESTRICTED UNIT
STOCK BONUS AWARD
AGREEMENT
This instrument is issued as of the 15th day of January, 2009, by ONEOK, Inc., an Oklahoma corporation, (hereinafter referred to as
“Corporation”), to «Officer_Name» (hereinafter referred to as “Grantee”), an employee of the Corporation or a division or subsidiary thereof,
pursuant to the terms of the ONEOK, Inc. Long-Term Incentive Plan, as amended (hereinafter referred to as the “Plan”).
1. Restricted Unit Award. This instrument and that certain Restricted Unit Stock Bonus Award and Agreement, dated January 15,
2009, a copy of which is attached hereto and incorporated herein by reference (the “Notice of Restricted Unit Stock Bonus Award and
Agreement”) constitute evidence of the issuance and grant of a Stock Bonus Award (hereinafter referred to as "Award") to the Grantee by the
Corporation under the Plan pursuant to which shares of the Corporation's Common Stock (hereinafter referred to as "Common Stock") shall be
distributed in the future to the Grantee 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, pursuant to and in accordance with the terms of this instrument under which the
Corporation grants a Stock Bonus Award under the Plan that shall include and is to be awarded by the grant restricted stock units (hereinafter
referred to a "Restricted Units) under the Plan in the amount of «No_of_Restricted_Units» Restricted Units that shall entitle the Grantee to
receive shares of Common Stock all subject to the terms, provisions, and conditions of this instrument (including, without limitation, the
restrictions stated in paragraph 5, below) and of the Plan, which are incorporated herein by reference. This instrument, when executed by the
Grantee, together with the Notice of Restricted Unit Stock Bonus Award and Agreement constitute an agreement between the Corporation and
the Grantee. Notwithstanding the foregoing, should there be any inconsistency between the provisions of this instrument and the terms of
the Award stated in the resolutions and records of the Board of Directors of the Corporation, or the Plan, the provisions of such resolutions
and records and of the Plan shall control. The grant of Restricted Units to the Grantee and the Grantee’s entitlement to receive and be issued
shares of Common Stock shall be effective in the manner and to the extent provided in this instrument and the Plan as to all or any part of the
shares of Common Stock subject to the grant from time to time during the period stated herein.
2. Plan. The Award is issued pursuant to the Plan, as approved by the Shareholders of the Corporation, which provides that a
specific aggregate number of shares of Common Stock of the Corporation may be issued or transferred pursuant to Stock Incentives under the
Plan. The Plan specifies the authority of the Corporation, its Board of Directors, and a committee of the Board of Directors to select employees
to be granted Stock Incentives. The Executive Compensation Committee of the Board of Directors (hereinafter referred to as the “Committee”)
is authorized to administer the Plan with respect to the Award and the grant of the Award made to the Grantee pursuant to the Plan. Except
where expressly stated or clearly indicated otherwise by the terms of this instrument, all terms, words and phrases used herein shall have the
same meaning and effect as stated in the Plan. The Grantee has been provided a complete copy of the Plan with this instrument.
3. Grantee’s Agreement Concerning Award and Employment. In consideration of the Corporation’s granting the Award as
incentive compensation to Grantee pursuant to this instrument, the Grantee by acceptance thereof, and signing this instrument evidencing its
terms, agrees to such terms and to continue to contribute and perform service in the employ of the Corporation or a division or subsidiary
thereof at the direction, will and pleasure of the Corporation and the Board of Directors. 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
Corporation (or a division or subsidiary thereof), or interfere in any way with the right of the Corporation (or such division 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 Corporation
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 date of the grant; 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 instrument 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 to the Grantee shall be restricted during the period beginning
January 15, 2009, the date of the grant thereof (hereinafter referred to as “Grant Date”) and ending on January 15, 2012, (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 as a Stock Bonus Award under the Plan
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 instrument and the Plan until the expiration of the Restricted Period.
(c) The Grantee shall earn and become vested and entitled to the Restricted Units granted by this Award under paragraph 1, above,
at the expiration of the Restricted Period. Upon expiration of the Restricted Period, the Grantee shall be entitled to receive, and the Corporation
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 paid, distributed, transferred and issued on the
date of expiration of the Restricted Period, or a soon as practicable after such date as determined by the Committee, but in no event after the
15th day of the third month after such date.
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(d) The Grantee shall become vested in the Restricted Units granted to the Grantee 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 Corporation (or a
division 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.
(e) If the Grantee’s employment with the Corporation (or a division or Subsidiary thereof) terminates prior to the end of the
Restricted Period by reason of (i) the Grantee’s voluntary termination of the Grantee’s employment with the Corporation (or a division or
Subsidiary), or (ii) the involuntary Termination for Cause by the Corporation of the Grantee’s employment with the Corporation (or a division
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; and the Grantee shall forfeit such right, title and interest in the Restricted Units, and to any Common Stock
payable or to be issued pursuant to the Award regardless of the reason for such termination of employment. 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 Corporation and any division or Subsidiary of the Corporation.
(f) The Grantee shall not be entitled to vote any shares of Common Stock that may be issued to the Grantee pursuant to the Award
prior to the end of the Restricted Period and actual issuance of such Common Stock to the Grantee pursuant to the Award.
(g) No dividends with respect to shares of Common Stock that may be issued to the Grantee under the Award shall accrue or
become payable to the Grantee prior to the end of the Restricted Period and issuance of such Common Stock to Grantee pursuant to the
Award.
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 instrument, 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
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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 anything to the contrary expressed or implied herein (including without limitation, the restrictions stated in
paragraph 5, above, applicable to the Restricted Units), 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 Corporation (or a division
or Subsidiary), or (ii) the involuntary Termination for Cause by the Corporation of the Grantee’s employment with the Corporation (or a
division or Subsidiary).
(d) Notwithstanding the foregoing provisions, in the event of termination of the Grantee’s employment with the Corporation (or a
division or Subsidiary) during the Restricted Period by reason of (i) the involuntary termination of the Grantee’s employment with the
Corporation (or a division or 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 Corporation (or a division 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 or heirs of the Grantee, as applicable, shall be entitled to receive and the Corporation 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 date of
expiration of the Restricted Period, or as soon as practicable thereafter as determined by the Committee, but in no event later than the 15th day
of the third calendar month after the date of the expiration 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 to the Grantee and this instrument, an involuntary “Termination for Cause” of the Grantee’s
employment with and by the Corporation (or a division or Subsidiary) shall mean that the Corporation (or a division or Subsidiary) has
terminated 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 Corporation (or a division or Subsidiary), (iii) any violation by the
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Grantee of any covenant not to compete with the Corporation (or a division or Subsidiary), (iv) any act of dishonesty by the Grantee which
adversely effects the business of the Corporation (or a division 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 Corporation (or a division or Subsidiary); (vi) the Grantee’s use of
alcohol or drugs which interferes with the Grantee’s performance of duties as an employee of the Corporation (or a division or Subsidiary), or
(vii) the Grantee’s failure or refusal to perform the specific directives of the Corporation’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 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
Grantee’s employment at any time without cause.
(g) For purposes of this instrument and the Award,"Retirement" shall mean a voluntary termination of employment of the Grantee
with the Corporation and/or a division 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 Corporation and/or a division or subsidiary thereof 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 Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (or corresponding section of
any future federal tax code), and regulations thereunder.
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 Corporation upon the Grantee's Retirement prior to the expiration 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 Corporation by such Retirement, as soon as practicable thereafter as
determined by the Committee, but in no event later than the 15th 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 instrument or the
Award shall be the date of expiration of the Restricted Period, or as soon as practicable thereafter as determined by the Committee, but in no
event later than the 15th day of the third calendar month after the date of expiration 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 Corporation and the Grantee
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of the time and form of payment for purposes of the application to this instrument and the Award of the provisions of Section 409A of the
Internal Revenue Code of 1986, as amended, and the provisions of this instrument 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 Award 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 instrument 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 Corporation any applicable federal, state, or local income, employment,
social security, Medicare, or other withholding tax obligation arising in connection with the grant of the Award to the Grantee; and the
Corporation 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 Market Value (as defined in the Plan) on the date of such withholding. The Grantee, with the consent of the Corporation,
may satisfy such withholding tax by delivery and transfer to the Corporation 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.
(d) The provisions of this instrument 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.
(e) Notwithstanding anything otherwise provided under the Plan or in this instrument 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 Corporation is made not later than the close of the preceding taxable year or such other time as
provided in Treasury Regulations under section 409A of the Internal Revenue Code of 1986, as amended ("Code"), 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,
(3) If the Grantee is a Specified Employee, 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 instrument shall not permit a subsequent election, unless authorized and agreed to in writing by the Corporation and
Grantee; and if under the Plan or this instrument 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 instrument and the Award, and the entitlement to and time of payment of any compensation
deferred under this instrument 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 Corporation, or in the ownership of a substantial portion of the assets of the Corporation,
which shall be if (i) a Person acquires more than 50% of the Corporation’s stock; (ii) a Person acquires during a 12-month period at least 30%
(or a higher percentage specified under the Plan) of the Corporation’s stock; (iii) a majority of the members of the Board of Directors of the
Corporation 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 Corporation’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
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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 instrument 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 or the
Grantee or the Corporation.
(iv) "Specified Employee" means a key employee (as defined in Code section 416(i) without regard to paragraph (5) thereof) of the
Corporation.
(v) "Specified Time" means a specified date at which deferred compensation deferred by or for the Grantee pursuant to this
instrument 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).
8. Administration of Restricted Unit Award. The grant of the Award 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 instrument 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 Corporation any
applicable federal, state, or local income, employment, social security, medicare, or other withholding tax obligation arising in connection with
the grant of the Award to the Grantee; and the Corporation 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 Market Value (as defined in the Plan) on the date of such withholding.
The Grantee, with the consent of the Corporation, may satisfy such withholding tax by delivery and transfer to the
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Corporation 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 Corporation 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 Corporation, there shall be added to the number of Restricted Units
described in paragraph 1 of this instrument, the number of Restricted Units which the Grantee would have been entitled to if the Grantee had
been the fully vested and 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
instrument (including, without limitation, the restrictions stated in paragraph 5, above), 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 Corporation, 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 instrument 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 Corporation 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 instrument, 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 instrument
(including, without limitation, the restrictions stated in paragraph 5, above), 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 instrument, 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 Corporation, 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 date of the grant 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 Corporation in writing, to remain in the employ of the Corporation
or a division or subsidiary of the Corporation at least through the date which is six (6) months after the date the grant was made with
substantially the same title, duties, authority, reporting relationships, and
-9--
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 Corporation 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 Corporation, 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 Corporation 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 which may be made from time to time in the future
pursuant to the provisions of the Plan, with any amended definition of such term to apply to all events thereafter coming within the amended
meaning.
10. Required Grantee Repayment/Reduction Provision. Notwithstanding anything in the Plan, the Award or this instrument to the
contrary, all or a portion of the Award made to the Grantee under this instrument is subject to being called for repayment to the Corporation
or reduced in any situation where the Board of Directors of the Corporation or a Committee thereof determines that fraud, negligence, or
intentional misconduct by the Grantee was a contributing factor to the Corporation having to restate all or a portion of its financial
statement(s). The Committee may determine whether the Corporation 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 Corporation , (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
Corporation'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 Corporation. The Grantee, in consideration of the grant of the Award, and by the Grantee's execution of this
instrument, acknowledges the Grantee's understanding of and 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 Corporation
or Committee to effect its terms with respect to the Grantee, the Award and/or any other compensation described herein.
11. Stock Reserved. The Corporation 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 instrument,
and shall pay all original issue taxes, if any, on the transfer of the Common Stock to the Grantee and all other fees and expenses necessarily
incurred by the Corporation in connection therewith.
12. Rights of Shareholder. Except as otherwise provided in this instrument, the Grantee shall have no rights as a shareholder of the
Corporation in respect of the Restricted Units or Common Stock for which the Award is granted; and the Grantee shall not be considered or
- 10 - -
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 imposed under the Award indicated in this instrument, and Common Stock is actually issued and
transferred to Grantee.
13. Entire Agreement. This instrument contains the entire terms of the Award, and may not be changed orally or other than by a
written instrument issued and approved by the Corporation pursuant to the Plan. This instrument 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 instrument 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 instrument, 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 instrument, subject to all terms and provisions of the Plan, by signing
this instrument in duplicate originals, as of the date first stated above.
Date «Officer_Name»
Grantee
- 11 - -
Exhibit 12
ONEOK, Inc.
Computation of Ratio of Earnings to Fixed Charges
(Unaudited) 2008 2007 2006 2005 2004

Fixed Charges, as defined

Interest on long-term debt $ 254,765 $ 249,925 $ 233,152 $ 117,365 $ 79,318
Other interest 44,858 16,115 4,493 27,031 5,239
Amortization of debt discount, premium
and expense 4,421 5,710 4,115 3,935 3,713
Interest on lease agreements 29,524 37,448 12,738 20,781 21,638
Total Fixed Charges 333,568 309,198 254,498 169,112 109,908
Earnings before income taxes and undistributed
income of equity method investees 771,239 681,169 747,950 647,308 314,714
Earnings available for fixed charges $ 1,104,807 $ 990,367 $ 1,002,448 $ 816,420 $ 424,622
Ratio of earnings to fixed charges 3.31x 3.20x 3.94x 4.83x 3.86x
For purposes of computing the ratio of earnings to fixed charges, "earnings" consists of income before cumulative effect of a change in
accounting principle plus fixed charges, minority interests in income of consolidated subsidiaries, income taxes and distributed income of
equity method investees, less capitalized interest and undistributed income of equity method investees. "Fixed charges" consists of interest
expensed and capitalized, the amortization of debt discounts and issue costs and the representative interest portion of operating leases.
Exhibit 21
ONEOK, Inc.
SUBSIDIARIES OF THE COMPANY
Divisions
Oklahoma Natural Gas Company, a division of ONEOK, Inc.

Kansas Gas Service Company, a division of ONEOK, Inc.
Texas Gas Service Company, a division of ONEOK, Inc.
ONEOK Gas Transportation Company, a division of ONEOK, Inc.
State of
Incorporation
Subsidiaries or Organization
Kansas Gas Marketing Company Kansas
Mercado Gas Services Inc. Delaware
ONEOK Partners GP, L.L.C. Delaware
NBP Services, LLC Delaware
Northern Border Pipeline Corporation Delaware
ONEOK NB Company Delaware
Oklahoma Natural Energy Services Company Oklahoma
ONEOK Bushton Processing, Inc. Delaware
ONEOK Energy Marketing Company Oklahoma
ONEOK Energy Services Canada, Ltd. Canada
ONEOK Energy Services Company, II Delaware
ONEOK Energy Services Company, L.P. Texas
ONEOK Energy Services Holdings, L.L.C. Oklahoma
ONEOK Field Services Holdings, L.L.C. Oklahoma
ONEOK Kansas Company Kansas
ONEOK Kansas Properties, L.L.C. Kansas
ONEOK Leasing Company Delaware
ONEOK Parking Company, L.L.C. Delaware
ONEOK Propane Company Delaware
ONEOK Services Company Oklahoma
ONEOK Texas Resources, Inc. Delaware
ONEOK PB Company, L.L.C. Delaware
ONEOK Partners, L.P. (45.7%) Delaware
Subsidiaries of ONEOK Partners, L.P.
ONEOK Partners Intermediate Limited Partnership Delaware

ONEOK ILP GP, L.L.C. Delaware
Bear Paw Investments, LLC Delaware
Bear Paw Energy, LLC Delaware
Bear Paw Processing Company (Canada), Ltd. Alberta

Brown Bear Enterprises, LLC Delaware
Border Minnesota Pipeline, LLC Delaware
Black Mesa Holdings, Inc. Delaware
Black Mesa Pipeline, Inc. Delaware
Black Mesa Pipeline Operations, L.L.C. Delaware
Black Mesa Technologies, Inc. Oklahoma
Black Mesa Technologies Services, LLC (60%) Oklahoma
Border Midstream Services, Ltd. Alberta
Border Midwestern Company Delaware
Midwestern Gas Marketing Company Delaware
Midwestern Gas Transmission Company Delaware
Border Viking Company Delaware
Viking Gas Transmission Company Delaware
Crestone Energy Ventures, L.L.C. Delaware
Crestone Bighorn, L.L.C. Delaware
Crestone Gathering Services, L.L.C. Delaware
Crestone Powder River, L.L.C. Delaware
Crestone Wind River, L.L.C. Delaware
Northern Border Pipeline Company (general partnership) (50%) Texas
China Pipeline Holdings Ltd. (0.81%) Cayman Islands
Guardian Pipeline, L.L.C. Delaware
Bighorn Gas Gathering, L.L.C. (49.0%) Delaware
Fort Union Gas Gathering, L.L.C. (37.04%) Delaware
Lost Creek Gathering Company, L.L.C. (35%) Delaware
Chisholm Pipeline Company (50%) Delaware
Chisholm Pipeline Holdings, L.L.C. Delaware
Mid Continent Market Center, L.L.C. Kansas
OkTex Pipeline Company, L.L.C. Delaware
ONEOK Arbuckle Pipeline, L.L.C. Delaware
ONEOK Arbuckle Land Company Texas
ONEOK Field Services Company, L.L.C. Oklahoma
ONEOK Gas Gathering, L.L.C. Oklahoma
ONEOK Gas Storage Holdings, L.L.C. Delaware
ONEOK Gas Storage, L.L.C. Oklahoma
ONEOK Gas Transportation, L.L.C. Oklahoma
ONEOK Hydrocarbon, L.L.C. Delaware
ONEOK Hydrocarbon, L.P. Delaware
ONEOK Hydrocarbon GP, L.L.C. Delaware
ONEOK Hydrocarbon Holdings, L.L.C. Delaware
ONEOK Hydrocarbon Southwest, L.L.C. Delaware
ONEOK MB I, L.P. Delaware
ONEOK Midstream Gas Supply, L.L.C. Oklahoma
ONEOK Mont Belvieu Storage Company, L.L.C. Delaware
ONEOK NGL Pipeline, L.L.C. Delaware
ONEOK NGL Gathering, L.L.C. Delaware
-2--
ONEOK North System, L.L.C. Delaware

ONEOK Overland Pass Holdings, L.L.C. Oklahoma
ONEOK Pipeline Holdings, L.L.C. Delaware
ONEOK Texas Gas Storage, L.L.C. Texas
ONEOK Transmission Company, L.L.C. Delaware
ONEOK Underground Storage Company, L.L.C. Kansas
ONEOK VESCO Holdings, L.L.C. Delaware
ONEOK WesTex Transmission, L.L.C. Delaware
Overland Pass Pipeline Company LLC Delaware
Potato Hills Gas Gathering System (joint venture) (51%) Oklahoma
Sycamore Gas System (general partnership) (48.445%) Oklahoma
Venice Energy Services Company, L.L.C. (10.1765%) Delaware
Mont Belvieu I Fractionation Facility (joint venture)(80%) Texas
Heartland Pipeline Company (general partnership) (50%) Texas
-3--
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (Nos. 333-155592 and 333-155593) and Form
S-8 (Nos. 333-152748, 333-41263, 333-41265, 333-41267, 333-42094, 333-95039, 333-130070, 333-130067, 333-140629, 333-75768 and 333-121769) of
ONEOK, Inc. of our report dated February 24, 2009 relating to the consolidated financial statements and the effectiveness of internal control
over financial reporting, which appears in this Form 10-K.
/s/ PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 24, 2009
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors

ONEOK Inc.
We consent to the incorporation by reference in registration statements (Nos. 333-152748, 333-75768, 333-41263, 333-41265, 333-41267, 333-
42094, 333-95039, 333-121769, 333-130070, 333-130067 and 333-140629) on Form S-8 and (Nos. 333-155593 and 333-155592) on Form S-3 of
ONEOK, Inc. of our report dated February 28, 2007, with respect to the consolidated statements of income, shareholders’ equity and
comprehensive income, and cash flows for the year ended December 31, 2006 of ONEOK, Inc. and subsidiaries, which report appears in the
December 31, 2008, annual report on Form 10-K of ONEOK, Inc. Our report refers to a change in accounting for defined benefit pension and
other postretirement plans, the consolidation of limited partnerships or similar entities when limited partners have certain rights, and stock
based compensation expense in 2006.
/s/ KPMG LLP
February 24, 2009

Tulsa, OK
Exhibit 31.1
Certification
I, John W. Gibson, certify that:
I have reviewed this annual report on Form 10-K of ONEOK, Inc.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered
by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-
15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under
our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such
evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent
functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
internal control over financial reporting.
Date: February 24, 2009
/s/ John W. Gibson

John W. Gibson
Exhibit 31.2
Certification
I, Curtis L. Dinan, certify that:
I have reviewed this annual report on Form 10-K of ONEOK, Inc.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered
by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-
15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under
our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such
evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent
functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
internal control over financial reporting.
Date: February 24, 2009
/s/ Curtis L. Dinan

Curtis L. Dinan
Chief Financial Officer
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K of ONEOK, Inc. (the “Company”) for the period ending December 31, 2008 as filed with
the Securities and Exchange Commission on the date hereof (the “Report”), I, John W. Gibson, Chief Executive Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.
/s/ John W. Gibson

John W. Gibson
February 24, 2009
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting
the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to
ONEOK, Inc. and will be retained by ONEOK, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K of ONEOK, Inc. (the “Company”) for the period ending December 31, 2008 as filed with
the Securities and Exchange Commission on the date hereof (the “Report”), I, Curtis L. Dinan, Chief Financial Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.
/s/ Curtis L. Dinan

Curtis L. Dinan
Chief Financial Officer
February 24, 2009
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting
the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to
ONEOK, Inc. and will be retained by ONEOK, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

ONEOK INC /NEW/ 10-K (Annual Reports) 2009-02-25

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Commission file number 001-13643

100 West Fifth Street, Tulsa, OK 74103

Registrant’s telephone number, including area code (918) 588-7000

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

Securities registered pursuant to Section 12(g) of the Act: None

DOCUMENTS INCORPORATED BY REFERENCE:

Item 1. Business 5-17

Item 1A. Risk Factors 17-29

Item 1B. Unresolved Staff Comments 29

Item 2. Properties 29-30

Item 3. Legal Proceedings 31-32

Item 4. Submission of Matters to a Vote of Security Holders 32

Item 6. Selected Financial Data 35

Item 8. Financial Statements and Supplementary Data 67-117

Item 9A. Controls and Procedures 117-118

Item 9B. Other Information 118

Item 10. Directors, Executive Officers and Corporate Governance 118-119

Item 11. Executive Compensation 119

Item 14. Principal Accounting Fees and Services 120

Item 15. Exhibits, Financial Statement Schedules 120-125

AFUDC Allowance for funds used during construction

TC PipeLines TC PipeLines Intermediate Limited Partnership, a subsidiary of TC

DESCRIPTION OF BUSINESS SEGMENTS

We report operations in the following reportable business segments:

Outlook for 2009

SIGNIFICANT DEVELOPMENTS IN 2008

SEGMENT FINANCIAL INFORMATION

Years Ended December 31,

* Represents a value of less than 1 percent.

Years Ended December 31,

* Represents a value of less than 1 percent.

NARRATIVE DESCRIPTION OF BUSINESS

The main factors that affect ONEOK Partners’ margins are:

The integrated strategy for our LDCs incorporates:

ENVIRONMENTAL AND SAFETY MATTERS

Union Employees Contract Expires

Name and Position Age Business Experience in Past Five Years

ITEM 1A. RISK FACTORS

RISK FACTORS INHERENT IN OUR BUSINESS

Current levels of market volatility are unprecedented.

Our businesses are subject to market and credit risks.

Increased competition could have a significant adverse financial impact on us.

Our business is subject to increased regulatory oversight and potential penalties.

RISK FACTORS RELATED TO ONEOK PARTNERS’ BUSINESS

ITEM 1B. UNRESOLVED STAFF COMMENTS

Property - Our ONEOK Partners segment owns the following assets:

ITEM 3. LEGAL PROCEEDINGS

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

MARKET INFORMATION AND HOLDERS

Year Ended Year Ended

Years Ended December 31,

ISSUER PURCHASES OF EQUITY SECURITIES

Total Number of Maximum Number (or

October 1-31, 2008 - - - -

EMPLOYEE STOCK AWARD PROGRAM

Value of $100 Investment Assuming Reinvestment of Dividends

Cumulative Total Return

ONEOK, Inc. $ 100.00 $ 133.74 $ 130.01 $ 218.10 $ 233.19 $ 157.65

ITEM 6. SELECTED FINANCIAL DATA

Years Ended December 31,

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

Key Performance Indicators - Key performance indicators reviewed by management include:

SIGNIFICANT ACQUISITIONS AND DIVESTITURES