Chesapeake Energy (CHK)

7. Benefit Plan

Columbia offers a Deferred Salary 401(k) Plan (the Plan) for all employees who are eligible to participate. Employees are immediately eligible to participate upon becoming a full-time employee with the Company. The Plan allows for the deferral of all or part of a participant’s base salary and incentive compensation bonuses. Participants may elect to have their deferred

21

Columbia Energy Resources, LLC (a wholly owned

subsidiary of Triana Energy Holdings, LLC)

Notes to Consolidated Financial Statements (continued)

7. Benefit Plan (continued)

compensation invested in several investment alternatives. Employer matching and profit sharing contributions are discretionary. Employer contributions to the plan for the periods ended December 31, 2004 and 2003, were $1.3 million and $0.4 million, respectively.

Columbia also provides medical coverage and life insurance coverage for current employees. Essentially all active employees are eligible for these benefits, which cease upon separation from employment with the Company. The cost of these benefits, net of employee contributions, was $2.3 million and $0.9 million for the periods ended December 31, 2004 and 2003, respectively.