HOLLY CORP
FORM OF EXECUTIVE RESTRICTED STOCK AGREEMENT (TWO-YEAR TERM AND PERFORMANCE VEST
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<TYPE>EX-10.3
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<FILENAME>d19809exv10w3.htm
<DESCRIPTION>FORM OF EXECUTIVE RESTRICTED STOCK AGREEMENT (TWO-YEAR TERM AND PERFORMANCE VESTING FORM)
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<P align="right" style="font-size: 10pt">Exhibit&nbsp;10.3



<P align="center" style="font-size: 10pt"><B>&#091;TWO-YEAR TERM AND PERFORMANCE VESTING FORM&#093;</B>



<P align="center" style="font-size: 10pt"><B>HOLLY CORPORATION<BR>
EXECUTIVE<BR>
RESTRICTED STOCK AGREEMENT</B>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Restricted Stock Agreement (the &#147;Agreement&#148;) is made and entered into
by and between HOLLY CORPORATION, a Delaware corporation (the &#147;Company&#148;), and
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> (the &#147;Executive&#148;). If the Executive presently is or subsequently becomes
employed by a subsidiary of the Company, the term &#147;Company&#148; shall be deemed to
refer collectively to the Company and the subsidiary or subsidiaries which
employ the Executive. This Agreement is entered into as of the <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> day of
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> (the &#147;Date of Grant&#148;).


<P align="center" style="font-size: 10pt">W I T N E S S E T H:



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company has adopted the HOLLY CORPORATION LONG-TERM INCENTIVE
COMPENSATION PLAN (the &#147;Plan&#148;) to attract, retain and motivate Executives,
directors and consultants; and


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS, the Company believes that entering into this Agreement with the
Executive is consistent with the stated purposes for which the Plan was
adopted.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW, THEREFORE, it is agreed by and between the Company and the Executive,
in consideration of services rendered by the Executive, as follows:



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Grant. The Company hereby grants to the Executive as of the Date
of Grant an award of <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares (as defined in the Plan), subject to
the terms and conditions set forth in this Agreement, including, without
limitation, those described in Section&nbsp;5 (the &#147;Restricted Shares&#148;).



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Restricted Shares. The Company shall issue in the Executive&#146;s
name the Restricted Shares and such Restricted Shares shall be held for
the Executive in book entry form by the Company&#146;s transfer agent with a
notation that the shares are subject to restrictions. The Executive
hereby agrees that the Restricted Shares shall be held subject to
restrictions as provided in the Agreement until such time as the
Restricted Shares become Vested Shares (as defined in Section&nbsp;4 below).
The Executive hereby agrees that if part or all of the Restricted Shares
are forfeited pursuant to this Agreement, the Company shall have the
right to direct the Company&#146;s transfer agent to cancel such forfeited
Restricted Shares or, at the Company&#146;s election, transfer such Restricted
Shares to the Company or to any designee of the Company.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Rights of Executive. Effective as of the Date of Grant, the
Executive is a stockholder with respect to all of the Restricted Shares
granted to him pursuant to Section&nbsp;1 and has all of the rights of a
stockholder with respect to all such Restricted Shares, including the
right to vote such Restricted Shares and the right to receive all
dividends and other distributions paid with respect to such Restricted
Shares; provided,


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<P align="left" style="margin-left:3%; font-size: 10pt">however, that such Restricted Shares shall be subject to the
restrictions hereinafter described, including, without limitation, those
described in Section&nbsp;5.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Forfeiture and Expiration of Restrictions.



<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Executive shall forfeit to the Company (i)&nbsp;all of the
Restricted Shares immediately and without any payment to the
Executive whatsoever if the Executive&#146;s employment with the Company
or a subsidiary of the Company is terminated before <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
for any reason other than death, total and permanent disability, or
retirement, as provided in Section 4(b) below, and (ii)one-half
(1/2) of the Restricted Shares if the Executive&#146;s employment with
the Company or a subsidiary of the Company is so terminated after
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and before <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>. After <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>,
one-half (1/2) of the Restricted Shares (the &#147;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares&#148;) will
be fully vested if (A)&nbsp;the Executive meets the Employment
Requirement (as defined below) on <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and (B)&nbsp;the
Company achieves the Performance Standard (as defined below) for a
quarter in the period beginning <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and ending ,<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>. If the Performance Standard is not achieved for a quarter in
the period beginning <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and ending <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> the
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares shall be forfeited. The remaining one-half of the
Restricted Shares (the &#147;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares&#148;) will be fully vested if (A)
the Executive meets the Employment Requirement on <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
and (B)&nbsp;the Company achieves the Performance Standard for a quarter
in the period beginning <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and ending <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>.
If the Performance Standard is not achieved for a quarter in the
period beginning <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and ending <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, the <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
Shares shall be forfeited. If the Executive meets the applicable
Employment Requirement, the <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares and/or <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares as the
case may be will become vested on the date, if any, that the
Long-Term Incentive Compensation Plan Committee (the &#147;Committee&#148;)
certifies that the Company has met the Performance Standard
applicable for the <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares and/or the <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> Shares as the case
may be. For purposes of this Agreement, the Employment Requirement
means employment of the Executive by the Company or a subsidiary at
the date specified. For purposes of this Agreement, the
Performance Standard for any quarter is average Quarterly Adjusted
Net Income (as defined below) per diluted share of not less than
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> (computed taking into account the two-for-one stock split
effective August&nbsp;30, 2004) for the period that began on <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>,
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> and ends at the end of the quarter considered, computed as a
simple average (which will include only a single quarter in the
case of the quarter ending <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>) of the Quarterly
Adjusted Net Income per diluted share computed for each quarter in
such period. Quarterly Adjusted Net Income means net income for a
quarter, as reported by the Company in its filings with the
Securities and Exchange Commission, adjusted to exclude the effects
of recoveries or liabilities resulting from litigation and
administrative proceedings involving the Company and its
subsidiaries. Restricted Shares that become vested as provided
above are hereafter referred to as &#147;Vested Shares.&#148;


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<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of the Executive&#146;s (i)&nbsp;death, (ii)&nbsp;total and
permanent disability as determined by the Long-Term Incentive
Compensation Plan Committee (the &#147;Committee&#148;) in its sole
discretion, or (iii)&nbsp;retirement after attaining the normal
retirement age of 62 or retirement after attaining an earlier
retirement age approved by the Committee, in its sole discretion,
before lapse of all restrictions pursuant to Section 4(a) above,
the Executive shall forfeit a number of Restricted Shares equal to
the number of Restricted Shares specified in Section&nbsp;1 times the
percentage that the period of full months beginning on the first
day of the calendar month following the date of death, disability
or retirement and ending on <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> bears to twenty-four
(24)&nbsp;and any remaining Restricted Shares that are not vested shall
become Vested Shares; provided, however, that any fractional shares
will be forfeited to the Company. In its sole discretion, the
Committee may decide to vest all of the Restricted Shares in-lieu
of the prorated number of Restricted Shares as provided in this
Section&nbsp;4(b). Unless the Committee determines otherwise, in its
sole discretion, the Executive or the Executive&#146;s beneficiary or
estate will have no right to any Restricted Shares that remain
subject to restrictions, and those Restricted Shares will be
forfeited.



<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event of a &#147;Special Involuntary Termination&#148; as
defined in Section&nbsp;4(d)(vi) before lapse of all restrictions
pursuant to Section 4(a) above, all restrictions described in
Section&nbsp;5 shall lapse and the Restricted Shares will become Vested
Shares and the Company shall deliver the Vested Shares to the
Executive as soon as practicable thereafter.



<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Definitions. For purposes of Section 4(c) above,



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) &#147;Change in Control&#148; shall mean:



<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Any &#147;Person&#148; (as defined in Section&nbsp;4(d)(ii)
below), other than (1)&nbsp;the Company or any of its
subsidiaries, (2)&nbsp;a trustee or other fiduciary holding
securities under an employee benefit plan of the
Company or any of its &#147;Affiliates&#148; (as defined in
Section&nbsp;4(d)(v) below), (3)&nbsp;an underwriter temporarily
holding securities pursuant to an offering of such
securities, or (4)&nbsp;a corporation owned, directly or
indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership
of stock of the Company, is or becomes the &#147;Beneficial
Owner&#148; (as defined in Section&nbsp;4(d)(iii) below),
directly or indirectly, of securities of the Company
(not including in the securities beneficially owned by
such person any securities acquired directly from the
Company or its Affiliates) representing more than forty
percent (40%) of the combined voting power of the
Company&#146;s then outstanding securities, or more than
forty percent (40%) of the then outstanding common
stock of the Company, excluding any Person who becomes
such a Beneficial Owner in connection with a
transaction described in Section&nbsp;4(d)(i)(C)(I) below.


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<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The individuals who as of the Date of Grant
constitute the Board of Directors of the Company and
any &#147;New Director&#148; (as defined in Section&nbsp;4(d)(iv)
below) cease for any reason to constitute a majority of
the Board of Directors.



<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. There is consummated a merger or consolidation
of the Company or any direct or indirect subsidiary of
the Company with any other corporation, except if:



<P align="left" style="margin-left:11%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(I) the merger or consolidation results in
the voting securities of the Company outstanding
immediately prior thereto continuing to represent
(either by remaining outstanding or by being
converted into voting securities of the surviving
entity or any parent thereof) at least sixty
percent (60%) of the combined voting power of the
voting securities of the Company or such
surviving entity or any parent thereof
outstanding immediately after such merger or
consolidation; or



<P align="left" style="margin-left:11%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(II) the merger or consolidation is effected
to implement a recapitalization of the Company
(or similar transaction) in which no Person is or
becomes the Beneficial Owner, directly, or
indirectly, of securities of the Company (not
including in the securities beneficially owned by
such Person any securities acquired directly from
the Company or its Affiliates other than in
connection with the acquisition by the Company or
its Affiliates of a business) representing more
than forty percent (40%) of the combined voting
power of the Company&#146;s then outstanding
securities.



<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. The stockholders of the Company approve a plan
of complete liquidation or dissolution of the Company
or an agreement for the sale or disposition by the
Company of all or substantially all of the Company&#146;s
assets, other than a sale or disposition by the Company
of all or substantially all of the Company&#146;s assets to
an entity at least sixty percent (60%) of the combined
voting power of the voting securities of which is owned
by the stockholders of the Company in substantially the
same proportions as their ownership of the Company
immediately prior to such sale.



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) &#147;Person&#148; shall have the meaning given in section
3(a)(9) of the Securities Exchange Act of 1934 (the &#147;1934
Act&#148;) as modified and used in sections 13(d) and 14(d) of the
1934 Act.


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<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) &#147;Beneficial Owner&#148; shall have the meaning provided
in Rule&nbsp;13d-3 under the 1934 Act.



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) &#147;New Director&#148; shall mean an individual whose
election by the Company&#146;s Board of Directors or nomination
for election by the Company&#146;s stockholders was approved by a
vote of at least two-thirds (2/3) of the directors then still
in office who either were directors at the Date of Grant or
whose election or nomination for election was previously so
approved or recommended. However, &#147;New Director&#148; shall not
include a director whose initial assumption of office is in
connection with an actual or threatened election contest,
including but not limited to a consent solicitation relating
to the election of directors of the Company.



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) &#147;Affiliate&#148; shall have the meaning set forth in Rule
12b-2 promulgated under section 12 of the 1934 Act.



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) &#147;Special Involuntary Termination&#148; shall mean the
occurrence of (1)&nbsp;or (2)&nbsp;below within sixty (60)&nbsp;days prior
to, or at any time after, a &#147;Change in Control&#148; (as defined
in Section&nbsp;4(d)(i)), where (1)&nbsp;is termination of the
Executive&#146;s employment with the Company (including
subsidiaries of the Company) by the Company for any reason
other than &#147;Cause&#148; (as defined in Section&nbsp;4(d)(vii)) and (2)
is a resignation by the Executive from employment with the
Company (including subsidiaries of the Company) within ninety
(90)&nbsp;days after an &#147;Adverse Change&#148; (as defined in Section
4(d)(viii)) by the Company (including subsidiaries of the
Company) in the terms of the Executive&#146;s employment.



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) &#147;Cause&#148; shall mean:



<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. An act or acts of dishonesty on the part of the
Executive constituting a felony or serious misdemeanor
and resulting or intended to result directly in gain or
personal enrichment at the expense of the Company;



<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Gross or willful and wanton negligence in the
performance of the Executive&#146;s material and substantial
duties of employment with the Company; or



<P align="left" style="margin-left:9%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. Conviction of a felony involving moral
turpitude.



<P align="left" style="margin-left:9%; font-size: 10pt">The existence of Cause shall be determined by the
Committee, in its sole and absolute discretion.



<P align="left" style="margin-left:7%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) &#147;Adverse Change&#148; shall mean (A)&nbsp;a change in the
city in which the Executive is required to work regularly,
(B)&nbsp;a substantial increase in travel requirements of
employment, (C)&nbsp;a substantial reduction in duties of the type
previously performed by the Executive, or (D)&nbsp;a significant
reduction in compensation or benefits (other than bonuses and


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<P align="left" style="margin-left:7%; font-size: 10pt">other discretionary items of compensation) that does not
apply generally to executives of the Company or its
successor.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Limitations on Transfer. The Executive agrees that he shall not
dispose of (meaning, without limitation, sell, transfer, pledge,
exchange, hypothecate or otherwise dispose of) any Restricted Shares
hereby acquired prior to the expiration of the relevant restrictions
imposed by this Section&nbsp;5 which expiration shall be determined pursuant
to Section&nbsp;4 of this Agreement. Any attempted disposition of the
Restricted Shares in violation of the preceding sentence shall be null
and void, and the Company shall not recognize or give effect to such
transfer on its books and records or recognize the person or persons to
whom such proposed transfer has been made as the legal or beneficial
holder thereof. Notwithstanding the foregoing, part or all of the
Restricted Shares or rights under this Agreement may be transferred to a
spouse pursuant to a domestic relations order issued by a court of
competent jurisdiction; provided, however, such Restricted Shares shall
continue to be held pursuant to Section&nbsp;2 of this Agreement, and the
transferee under the domestic relations order shall agree that the
Restricted Shares so transferred shall continue to be subject to the
terms of this Agreement, including forfeiture in accordance with Section
4(a) of this Agreement and pro rata forfeiture in accordance with
Sections 4(a) and (b)&nbsp;of this Agreement.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Nontransferability of Agreement. This Agreement and all rights
under this Agreement shall not be transferable by the Executive during
his life other than by will or pursuant to applicable laws of descent and
distribution. Any rights and privileges of the Executive in connection
herewith shall not be transferred, assigned, pledged or hypothecated by
the Executive or by any other person or persons, in any way, whether by
operation of law, or otherwise, and shall not be subject to execution,
attachment, garnishment or similar process. In the event of any such
occurrence, this Agreement shall automatically be terminated and shall
thereafter be null and void. Notwithstanding the foregoing, all or some
of the Restricted Shares or rights under this Agreement may be
transferred to a spouse pursuant to a domestic relations order issued by
a court of competent jurisdiction, subject to the limitations on such
transfer described in Section&nbsp;5.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Adjustment of Restricted Shares. The number of Restricted Shares
granted to the Executive pursuant to this Agreement shall be adjusted to
reflect stock dividends, stock splits or other changes in the capital
structure of the Company, all in accordance with the Plan. All
provisions of this Agreement shall be applicable to such new or
additional or different shares or securities distributed or issued
pursuant to the Plan to the same extent that such provisions are
applicable to the shares with respect to which they were distributed or
issued. In the event that the outstanding Shares (as defined in the
Plan) of the Company are exchanged for a different number or kind of
shares or other securities, or if additional, new or different shares are
distributed with respect to the Shares (as defined in the Plan) through
merger, consolidation, or sale of all or substantially all of the assets
of the Company, each remaining share subject to this Agreement shall have
substituted for it a like number and kind of shares of new or replacement
securities as determined in the sole discretion of the Committee, subject
to the terms and provisions of the Plan.


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<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. Delivery of Vested Shares. No Vested Shares shall be delivered
pursuant to this Agreement until the approval of any governmental
authority required in connection with this Agreement, or the issuance of
Vested Shares hereunder, has been received by the Company. The Committee
will delay delivery of Vested Shares until the restrictions of Section&nbsp;5
lapse.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Securities Act. The Company shall have the right, but not the
obligation, to cause the Restricted Shares to be registered under the
appropriate rules and regulations of the Securities and Exchange
Commission. The Company shall not be required to deliver any Vested
Shares of stock hereunder if, in the opinion of counsel for the Company,
such delivery would violate the Securities Act of 1933 or any other
applicable federal or state securities laws or regulations.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Federal and State Taxes. The Executive may incur certain
liabilities for Federal, state or local taxes and the Company may be
required by law to withhold such taxes for payment to taxing authorities.
If the Executive makes the election permitted by section 83(b) of the
Internal Revenue Code, the taxes shall be due and payable for the year in
which this Agreement is executed. If the Executive does not make such
election, the taxes shall be payable for the year in which the
restrictions lapse pursuant to Section&nbsp;4. Upon determination of the year
in which such taxes are due and the determination by the Company of the
amount of taxes required to be withheld, if any, the Executive shall
either pay to the Company, in cash or by certified or cashier&#146;s check, an
amount equal to the taxes required to be paid on such transaction, or the
Executive shall authorize the Company to withhold from monies owing by
the Company to the Executive an amount equal to the amount of federal,
state or local taxes required to be withheld. Authorization of the
Executive to the Company to withhold taxes pursuant to this Section&nbsp;10
shall be in form and content acceptable to the Committee. An
authorization to withhold taxes pursuant to this provision shall be
irrevocable unless and until the tax liability of the Executive has been
fully paid. In the event that the Executive fails to make arrangements
that are acceptable to the Committee for providing to the Company, at the
time or times required, the amounts of federal, state and local taxes
required to be withheld with respect to the Restricted Shares granted to
the Executive under this Agreement, the Company shall have the right to
purchase at current market price as determined by the Committee and/or to
sell to one or more third parties in either market or private
transactions sufficient Vested Shares to provide the funds needed for the
Company to make the required tax payment or payments.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. Definitions; Copy of Plan. To the extent not specifically
provided herein, all terms used in this Agreement shall have the same
meanings ascribed to them in the Plan. By the execution of this
Agreement, the Executive acknowledges receipt of a copy of the Plan. If
any provision of this Agreement is held to be illegal, invalid or
unenforceable under any applicable law, then such provision will be
deemed to be modified to the minimum extent necessary to render it legal,
valid and enforceable; and if such provision cannot be so modified, then
this Agreement will be construed as if not containing the provision held
to be invalid, and the rights and obligations of the parties will be
construed and enforced accordingly.


<P align="center" style="font-size: 10pt">7
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<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Administration. This Agreement shall at all times be subject to
the terms and conditions of the Plan. The Committee shall have sole and
complete discretion with respect to all matters reserved to it by the
Plan and decisions of a majority of the Committee with respect thereto
and this Agreement shall be final and binding upon the Executive and the
Company. In the event of any conflict between the terms and conditions
of this Agreement and the Plan, the provisions of the Plan shall control.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. No Right to Continued Employment. This Agreement shall not be
construed to confer upon the Executive any right to continue as an
Executive of the Company and shall not limit the right of the Company, in
its sole discretion, to terminate the service of the Executive at any
time.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. Governing Law. This Agreement shall be interpreted and
administered under the laws of the State of Texas, without giving effect
to any conflict of laws provisions.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. Amendments. This Agreement may be amended only by a written
agreement executed by the Company and the Executive. Any such amendment
shall be made only upon the mutual consent of the parties, which consent
(of either party) may be withheld for any reason.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. No Liability for Good Faith Determinations. The Company and the
members of the Committee and the Board shall not be liable for any act,
omission or determination taken or made in good faith with respect to
this Agreement or the Restricted Shares granted hereunder.



<P align="left" style="margin-left:3%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. No Guarantee of Interests. The Board and the Company do not
guarantee the Shares (as defined in the Plan) from loss or depreciation.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its officers thereunto duly authorized, and the Executive has set his hand
effective as of the date and year first above written.

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</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3"><B>HOLLY CORPORATION</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
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    <TD>&nbsp;</TD>
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" style="border-top: 1px solid #000000">Executive&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
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<P align="center" style="font-size: 10pt">8
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