The TERMINATION AGREEMENT, dated as of
May 8, 2012 (this Agreement), is made and entered into by and between PetroQuest Energy, Inc., a Delaware corporation with its principal office at 400 E. Kaliste Saloom Road, Suite 6000, Lafayette, Louisiana 70508
(the Company), and Tracy Price (Executive).
R E C I T A L S
A. Company desires to enter into an agreement with Executive whereby severance benefits will be paid to Executive on a change in control
of the Company and consequent actual or constructive termination of Executives employment.
B. This Agreement sets forth
the severance benefits which the Company agrees that it will pay to the Executive if Executives employment with the Company terminates under one of the circumstances described herein following a Change in Control of the Company.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants contained herein, the parties hereto agree as
1. Term of Agreement. This Agreement shall be effective immediately on the date hereof and shall continue in
effect through December 31, 2015; provided, however, that commencing on January 1, 2016 and each January 1 thereafter, the term of this Agreement shall automatically be extended for one additional year unless not later than
September 30 of the preceding year, the Company shall have given notice that it does not wish to extend this Agreement; provided, further, that notwithstanding any such notice by the Company not to extend, this Agreement shall automatically be
extended for 24 months beyond the term provided herein if a Change in Control, as defined in Section 3 of this Agreement, has occurred during the term of this Agreement.
2. Effect on Employment Rights. This Agreement is not part of any employment agreement that the Company and Executive may have
entered. Nothing in this Agreement shall confer upon Executive any right to continue in the employ of the Company or interfere with or restrict in any way the rights of the Company, which are hereby expressly reserved, to terminate for any reason,
with or without Cause (as defined below).
Executive agrees that, subject to the terms and conditions of this Agreement, in
the event of a Potential Change in Control of the Company (as defined below), Executive will remain in the employ of the Company during the pendency of any such potential change in control and for a period of one year after the occurrence of an
actual Change in Control. For this purpose, a Potential Change in Control of the Company shall be deemed to have occurred if (a) the Company enters into an agreement the consummation of which would result in the occurrence of
a Change in Control, (b) any person (including the Company) publicly announces an intention to take or consider taking action which if consummated would constitute a Change in Control or (c) the Board of Directors of the Company (the
Board) adopts a resolution to the effect that a potential change in control of the Company has occurred.
3. Change in Control. For purposes of this Agreement, a Change in
Control of the Company shall be deemed to have occurred if any of the events set forth in any one of the following paragraphs shall occur:
(a) any person (as defined in section 3(a)(9) of the Securities Exchange Act of 1934, as amended (the Exchange Act), and as such term is modified in sections 13(d)
and 14(d) of the Exchange Act), excluding the Company or any of its subsidiaries, a trustee or any fiduciary holding securities under an employee benefit plan of the Company of any of its subsidiaries, an underwriter temporarily holding securities
pursuant to an offering of such securities or a corporation owned, directly or indirectly, by stockholders of the Company in substantially the same proportions as their ownership of the Company, is or becomes the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 30% or more of the combined voting power of the Companys then outstanding securities; or
(b) during any period of not more than two consecutive years, individuals who at the beginning of much period constitute
the Board and any new director (other than a director designated by a Person who has entered into an agreement with the Company to effect a transaction described in clause (a), (c) or (d) of this paragraph) whose election by the Board or
nomination for election by the Companys 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 beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute a majority thereof; or
shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than (i) a merger or consolidation which would result 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), in combination with the ownership of any trustee or other fiduciary holder of securities under an employee benefit plan
of the Company, at least 50% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or (ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which no person acquires more than 50% of the combined voting power of the Companys then outstanding securities; or
(d) the shareholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Companys assets.
Notwithstanding the foregoing, if any
transaction described under paragraphs (a), (c) and (d) of this Section 3 results in consideration to the Company or the shareholders of the Company, as the case may be, from such transaction with a value (as determined in good
faith by the Compensation Committee of the Board) of less than $1.00 per share (subject to adjustment for stock splits and combination and stock dividends after the date hereof), no Change in Control will be deemed to occur unless such transaction
is approved by persons holding not less than two-thirds of the combined voting power of the Companys voting securities entitled to vote on such transaction. In addition, no Change in Control shall be deemed to occur if there is consummated any
transaction or series of integrated transactions immediately following which, in the judgment of the Compensation Committee of the Board, the holders of the Companys Common Stock immediately prior to such transaction or series of transactions
continue to have the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately prior to such transaction or series of transactions.
4. Termination of Employment Following a Change in Control. Executive shall be
entitled to the benefits provided in Section 5 hereof upon the subsequent termination of Executives employment by the Company within two (2) years after a Change in Control which occurs during the term of this Agreement,
provided such termination is (a) by the Company other than for Cause, or (b) by Executive for Good Reason, as defined below. Executive shall not be entitled to the benefits of Section 5, any other provision hereof to the
contrary notwithstanding, if Executives employment terminates: (i) pursuant to Executive retiring at age 65, (ii) by reason of Executives total and permanent disability, or (iii) by reason of Executives death. As
used herein, total and permanent disability means a condition which prevents Executive from performing to a significant degree the essential duties of his or her position and is expected to be of long-term duration or result in
death. A determination of total and permanent disability must be based on competent medical evidence.
(i) Definition. Termination by the Company of Executives employment for
Cause shall mean termination upon Executives willful engaging in misconduct which is demonstrably and materially injurious to the Company and its subsidiaries taken as a whole. No act, or failure to act, on Executives
part shall be considered willful unless done, or omitted to be done, by Executive not in good faith and without reasonable belief that Executives action or omission was in the best interest of the Company or its subsidiaries.
Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to Executive a copy of a resolution duly adopted by the affirmative vote of not less than three quarters
of the entire membership of the Board at a meeting of the Board called and held for the purpose of making a determination of whether Cause for termination exists (after reasonable notice to Executive and an opportunity for Executive to be heard
before the Board), finding that in the good faith opinion of the Board Executive was guilty of misconduct as set forth above in this subsection 4(a)(i) and specifying the particulars thereof in detail.
(ii) Remedy by Executive. If the Company gives Executive a Notice of Termination which states that the basis for
terminating Executives employment is Cause, Executive shall have ten days after receipt of such Notice to remedy the facts and circumstances which provided Cause. The Board (or any duly authorized Committee thereof) shall make a good faith
reasonable determination immediately after such ten-day period whether such facts and circumstances have been remedied and shall communicate such determination in writing to Executive. If the Board determines that an adequate remedy has not
occurred, then the initial Notice of Termination shall remain in effect.
(b) Good Reason. After a Change in Control, Executive may terminate
employment with the Company at any time during the term of this Agreement if Executive has made a good faith reasonable determination that Good Reason exists for this termination.
(i) Definition. For purposes of this Agreement, Good Reason shall mean any of the following
actions, if taken without the express written consent of Executive:
A. any material change by the Company in
Executives functions, duties, or responsibilities which change would cause Executives position with the Company to become of less dignity, responsibility, importance, or scope from the position and attributes that applied to Executive
immediately prior to the Change in Control;
B. any significant reduction in Executives base salary,
other than a reduction effected as part of an across-the-board reduction affecting all executive employees of the Company;
C. any material failure by the Company to comply with any of the provisions of this Agreement (or of any employment agreement between the parties);
D. the Companys requiring Executive to be based at any office or location more than 45 miles from the home at which
the Executive resides on the date immediately preceding the Change in Control, except for travel reasonably required in the performance of Executives responsibilities and commensurate with the amount of travel required of Executive prior to
the Change in Control; or
E. any failure by the Company to obtain the express assumption of this Agreement by
any successor or assign of the Company.
Executives right to terminate employment for Good Reason
pursuant to this subsection 4(b)(i) shall not be affected by Executives incapacity due to physical or mental illness.
(ii) Remedy by Company. If Executive gives the Company a Notice of Termination which states that the basis for Executives termination of employment is Good Reason, the Company shall have ten
days after receipt of such Notice to remedy the facts and circumstances which provided Good Reason. Executive shall make a good faith reasonable determination immediately after such ten-day period whether such facts and circumstances have been
remedied and shall communicate such determination in writing to the Company. If Executive determines that adequate remedy has not occurred, then the initial Notice of Termination shall remain in effect.
(iii) Determination by Executive Presumed Correct. Any determination
by Executive pursuant to this Section 4(b) that Good Reason exists for Executives termination of employment and that adequate remedy has not occurred shall be presumed correct and shall govern unless the party contesting the
determination shows by a clear preponderance of the evidence that it was not a good faith reasonable determination.
(iv) Severance Payment Made Notwithstanding Dispute. Notwithstanding any dispute concerning whether Good Reason exists for termination of employment or whether adequate remedy has occurred, the
Company shall immediately pay to Executive, as specified in Section 5, any amounts otherwise due under this Agreement.
(c) Notice of Termination. Any termination of Executives employment by the Company or by Executive hereunder shall be communicated by a Notice of Termination to the other party hereto. For
purposes of this Agreement, a Notice of Termination shall mean a written notice which shall indicate the specific termination provisions in this Agreement relied upon any which sets forth (i) in reasonable detail the facts
and circumstances claimed to provide a basis for termination of Executives employment under the provision so indicated and (ii) the date of Executives termination of employment, which shall be no earlier than 10 days after such
Notice is received by the other party. Any purported termination of the Executives employment by the Company which is not effected pursuant to a Notice of Termination satisfying the requirements of this Agreement shall not be effective. In the
case of a termination for Cause, the Notice of Termination shall also satisfy the requirements set forth in Section 4(a)(i).
5. Severance Payment Upon Termination of Employment. If Executives employment with the Company is terminated during the term of this Agreement and after a Change in Control (a) by the
Company other than for Cause, or (b) by Executive for Good Reason, then Executive shall be entitled to the following:
(a) Lump-Sum Severance Payment. In lieu of any further salary payments to the Executive for periods subsequent to the date of termination, the Company shall pay to the Executive a lump sum
severance payment, in cash, equal to two (2) (or, if less, the number of years, including fractions, from the date of termination until the Executive would have reached age sixty-five (65)) times the sum of (a) the Executives
annual base salary in effect on date of termination and (b) the Executives most recent annual bonus. If the most recent Annual Bonus was a stock option or a stock grant, the value of the bonus will be deemed to be the number of option
shares times the closing price of the Companys Common Stock for the 20 trading days prior to termination.
(b) Continued Benefits. For a twenty-four
(24) month period (or, if less, the number of months from the date of termination until the Executive would have reached age sixty-five (65)) after the date of termination, the Company shall continue to pay the Company portion of any
premiums and otherwise provide the Executive with life insurance, health, disability and other welfare benefits (Welfare Benefits) substantially similar in all respects to those which the Executive is receiving immediately prior
to the Notice of Termination in accordance with the Companys normal payroll practices (without giving effect to any reduction in such benefits subsequent to the Potential Change in Control of the Company preceding the Change in Control or the
Change in Control which reduction constitutes or may constitute Good Reason). With respect to benefits set forth in this subsection (b), all insurance premium and/or benefit payments by the Company, to the extent possible, shall be made so as
to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended and the rules, notices and regulations thereunder (the Code), and for the purposes thereof, each payment shall be treated as a separate payment
under Code Section 409A. Benefits otherwise receivable by an Executive pursuant to this Section shall be reduced to the extent substantially similar benefits are actually received by or made available to the Executive by any other employer
during the same time period for which such benefits would be provided pursuant to this Section at a cost to the Executive that is commensurate with the cost incurred by the Executive immediately prior to the Executives date of termination
(without giving effect to any increase in costs paid by the Executive after the Potential Change in Control of the Company preceding the Change in Control or the Change in Control which constitutes or may constitute Good Reason); provided, however,
that if the Executive becomes employed by a new employer which maintains a medical plan that either (i) does not cover the Executive or a family member or dependent with respect to a preexisting condition which was covered under the applicable
Company medical plan, or (ii) does not cover the Executive or a family member or dependent for a designated waiting period, the Executives coverage under the applicable Company medical plan shall continue (but shall be limited in the
event of noncoverage due to a preexisting condition, to such preexisting condition) until the earlier of the end of the applicable period of noncoverage under the new employers plan or the second anniversary of the Executives date of
termination. The Executive agrees to report to the Company any coverage and benefits actually received by the Executive or made available to the Executive from such other employer(s). The Executive shall be entitled to elect to change his level of
coverage and/or his choice of coverage options (such as Executive only or family medical coverage) with respect to the Welfare Benefits to be provided by the Company to the Executive to the same extent that actively employed senior executives of the
Company are permitted to make such changes; provided, however, that in the event of any such changes the Executive shall pay the amount of any cost increase that would actually be paid by an actively employed executive of the Company by reason of
making the same change in his level of coverage or coverage options. With respect to any benefits that are for medical, dental or vision expenses under a self-insured plan, the Executive shall pay the premiums for such coverage and the Company shall
reimburse the Executive for the Company portion of the cost of such premiums by the 15th day of the month following the month such premiums are paid by the Executive. After the group health benefits provided hereunder have expired, the Executive and his dependents shall be eligible to elect
continuation of health insurance coverage under COBRA and shall be responsible for the applicable premiums under COBRA. With respect to any premiums or amounts payable under this Section, to the extent that such amounts are taxable and not otherwise
exempt from deferred compensation under Code Section 409A, the Executive shall pay the premiums or expenses, the Company shall promptly reimburse Executive for such amounts and the Companys reimbursement payments shall be subject to the
following: (i) all amounts to be paid under this paragraph and that are includable in Executives income shall only be paid if such premiums or expenses are incurred during the two (2) year period after the Termination Date;
(ii) any amount reimbursable or paid in one tax year shall not affect the amount to be reimbursed or paid in another tax year; (iii) if Executive is reimbursed for any premiums or expenses hereunder, he must provide the Company with
reasonable documentation of such premiums or expenses; (iv) payments for such premiums or expenses will be made in cash promptly after the expenses are incurred but in no event later than the end of Executives taxable year following the
tax year in which the expenses are incurred; and (v) the payments under this paragraph cannot be substituted for another benefit.
(c) Gross-Up Payment. In the event that the Executive becomes
entitled to the severance benefits described in Sections 5(a) and 5(b) or any other benefits or payments under this Agreement or any other agreement, plan, instrument or obligation in whatever form of the Company or its subsidiaries or
affiliates (other than pursuant to this Section) including by reason of the accelerated vesting of stock options or restricted stock hereunder or thereunder (together, the Total Benefits), and in the event that any of the Total
Benefits will be subject to the excise tax under Code Section 4999, including interest, penalties or other excise tax thereon (the Excise Tax), the Company shall pay to the Executive an additional amount (the
Gross-Up Payment) such that the net amount retained by the Executive, after deduction of any Excise Tax on the Total Benefits and any federal, state and local income tax, Excise Tax and FICA and Medicare withholding taxes upon the
payment provided for by this Section, shall be equal to the Total Benefits.
For purposes of determining
whether any of the Total Benefits will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by the Executive in connection with a Change in Control or the Executives
termination of employment (whether pursuant to the terms of this Agreement or any other agreement, plan or arrangement with the Company, any Person whose actions result in a Change in Control or any Person affiliated with the Company or such Person)
shall be treated as parachute payments within the meaning of Section 280G(b)(2) of the Code, and all excess parachute payments within the meaning the Section 280G(b)(1) shall be treated as subject to the Excise Tax,
unless in the opinion of tax counsel (Tax Counsel) selected by the Companys independent auditors and acceptable to the Executive, such other payments or benefits (in whole or in part) do not constitute parachute payments, or
such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the Base Amount (as defined in the Code), or are otherwise
not subject to the Excise Tax, (ii) the amount of the Total Benefits which shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the total amount of the Total Benefits reduced by the amount of such Total
Benefits that in the opinion of Tax Counsel are not parachute payments, or (B) the amount of excess parachute payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and (iii) the value of any non-cash
benefits or any deferred payment or benefit shall be determined by the Companys independent auditors in accordance with the principles of Sections 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up
Payment, the Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate
of taxation in the state and locality of the Executives residence on the date of termination, net of the reduction in federal income taxes which could be obtained from deduction of such state and local taxes (calculated by assuming that any
reduction under Section 68 of the Code in the amount of itemized deductions allowable to the Executive applies first to reduce the amount of such state and local income taxes that would otherwise be deductible by the Executive).
(d) Timing of Payments. The payments provided for in
Sections 5(a) and 5(c) shall be made not later than the fifth (5th) day following the date of termination; provided, however, that if the amounts of such payments cannot be finally determined on or before such day, the
Company shall pay to the Executive on such day an estimate, as determined in good faith by the Company, of the minimum amount of such payments and shall pay the remainder of such payments (the Underpayment) as soon as the amount
thereof can be determined but in no event later than the thirtieth (30th) day after the date of termination, and if it is determined there is an Underpayment in any tax audit or proceeding under Code Section 4999, such Underpayment amount
shall be paid within 5 days after the conclusion of such tax audit or proceeding under Code Section 4999. Notwithstanding anything to the contrary in the foregoing provisions of this Section 5(d), in no event shall payment of any Gross-Up
Payment and any Underpayment be made later than December 31 of the year next following the year in which the Excise Tax is remitted to the taxing authority. Reimbursement of any costs or expenses incurred by the Executive due to a tax audit or
litigation related to parachute payments, excess parachute payments, Excise Tax or the Gross-Up Payments or other payments in Section 5(c) and Section 6 below shall be made by December 31 of the
year following the year in which the taxes that are the subject of the audit or litigation are remitted to the taxing authority, or where as a result of such audit or litigation no taxes are remitted, by December 31 of the year following the
year in which the audit is completed or there is a final and nonappealable settlement or other resolution of the litigation. The Executives right to payment or reimbursement pursuant to Section 5(c) or (d) shall not be
subject to liquidation or exchange for any other benefit.
(e) Specified Employee Status. In the event
that, as of the date of Executives Separation from Service, as defined in Treasury Regulation Section 1.409A-1(h), Executive is a specified employee, as defined in Treasury Regulation Section 1.409A-1(i), to
the extent that any of the payments under this Agreement payable on account of a Separation from Service, including without limitation, any payments in Sections 5 and 6 are subject to, and not exempt from, Code Section 409A, such
amounts shall be paid not earlier than (1) six months after the date of the Executives Separation from Service within the meaning of Code Section 409A, or (2) the date of Executives death, as required in accordance with
Section 409A(a)(2)(B)(i) of the Code and Treasury Regulation Section 1.409A-3(i)(2) (Waiting Period); any payments withheld during the Waiting Period will be paid in a lump sum amount on the first business day of the
seventh month following the Executives Separation from Service and payments thereafter shall be otherwise paid as provided herein.
(f) Termination of Employment. For the purposes of Code Section 409A, to the extent any payment under this Agreement is deferred compensation subject to and not exempt from Code
Section 409A, Executives termination and termination date from the Company shall mean a Separation from Service within the meaning of Code Section 409A.
6. Reimbursement of Legal Costs. The Company shall pay to the Executive all legal
fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to any payments under this Agreement including all such fees and expenses, if any, incurred in contesting or disputing any Notice of Termination
under Section 4(a) hereof or in seeking to obtain or enforce any right or benefit provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code
to any payment or benefit provide hereunder. Such payments shall be made within five (5) business days after delivery of the Executives respective written requests for payment accompanied by such evidence of fees and expenses incurred as
the Company reasonably may require.
Notwithstanding the foregoing, to the extent that Code Section 409A is applicable to
the expenses under this Section 6 as deferred compensation, to the extent that no exception under Code Section 409A is applicable the following shall apply (and to the extent such expenses are not reimbursements for tax audit or
litigation expenses which are subject to the reimbursement provisions of Section 5(d)): (a) all expenses to be paid under this Section 6 and that are taxable and includable in Executives income shall only be paid
for a period not to exceed 25 years from the Executives Separation from Service; (b) any amount reimbursable or paid in one tax year shall not affect the amount to be reimbursed or paid in another tax year; (c) the Executive must
provide the Company with reasonable documentation of such expenses; (d) payments for such expenses will be made in cash within 30 days after the reasonable documentation of the expenses incurred is provided but in no event later than the end of
Executives taxable year following the Executives tax year in which the expenses are incurred; and (e) the payments under this Section 6 cannot be substituted for another benefit.
7. Damages. Executive shall not be required to mitigate damages with respect to the amount of any payment provided under this
Agreement by seeking other employment or otherwise, nor shall the amount of any payment provided under this Agreement be reduced by retirement benefits, deferred compensation or any compensation earned by Executive as a result of employment by
8. Successor to Company. The Company shall require any successor or assign (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by agreement in form and substance satisfactory to Executive, expressly, absolutely and unconditionally to
assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession or assignment had taken place. As used in this Agreement, Company shall
mean the Company as hereinbefore defined and any successor or assign to its business and/or assets as aforesaid which executes and delivers the agreement provided for in this Section or which otherwise becomes bound by all the terms and provisions
of this Agreement by operation of law.
9. Heirs of Executive. This Agreement shall inure to the benefit of and be
enforceable by Executives personal and legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If Executive should die while any amounts are still payable to Executive hereunder, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to Executives devisee, legatee, or other designee or, if there be so much designee, to Executives estate.
10. Arbitration. Any dispute, controversy or claim arising under or in connection with this Agreement, or the breach thereof,
shall be settled exclusively by arbitration in accordance with the Rules of the American Arbitration Association then in effect. Judgment upon the award rendered by the arbitrator(s) may be entered in any court of competent jurisdiction. Any
arbitration held pursuant to this Section in connection with Executives termination of employment shall take place in Houston, Texas at the earliest possible date. If any proceeding is necessary to enforce or interpret the terms of this
Agreement, or to recover damages for breach thereof, the prevailing party shall be entitled to reasonable attorneys fees and necessary costs and disbursements, not to exceed in the aggregate one percent (1%) of the net worth of the other
party, in addition to any other relief to which he or it may be entitled. All such expenses shall be paid only if incurred prior to the last day of the second calendar year following the calendar year in which the Executives Separation from
11. Notice. For purposes of this Agreement, notices and all other communications provided for in this
Agreement shall be in writing and shall be deemed to have been duly given when delivered by messenger or in person, or when mailed by United States registered mail, return receipt requested, postage prepaid, as follows:
||If to the Company:
400 E. Kaliste Saloom Road
Lafayette, Louisiana 70508
||If to the Executive:
400 E. Kaliste Saloom Road
Lafayette, Louisiana 70508
or such other address as either party may have furnished to the other in writing in accordance herewith, except that
notices of change of address shall be effective only upon receipt.
12. General Provisions.
(a) Executives rights and obligations under this Agreement shall not be transferable by assignment or otherwise, nor
shall Executives rights be subject to encumbrance or subject to the claims of the Companys creditors. Nothing in this Agreement shall prevent the consolidation of the Company with, or its merger into, any other corporation, or the sale
by the Company of all or substantially all of its properties or assets; and this Agreement shall inure to the benefit of, be binding upon and be enforceable by, any successor surviving or resulting corporation, or other entity to which such assets
shall be transferred. This Agreement shall not be terminated by the voluntary or involuntary dissolution of the Company.
(b) This Agreement and any employment agreement with Executive plus terms of any stock option plans or grants constitutes the entire agreement between the parties hereto in respect to the rights and
obligations of the parties following a Change in Control. This Agreement supersedes and replaces all prior oral and written agreements, understandings, commitments, and practices between the parties (whether or not fully performed by Executive prior
to the date hereof), which shall be of no further force or effect.
(c) The provisions of this Agreement shall
be regarded as divisible, and if any of said provisions or any part thereof are declared invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remainder of such provisions or parts thereof and the
applicability thereof shall not be affected thereby.
(d) This Agreement may not be amended or modified except
by a written instrument executed by the Company and Executive.
(e) This Agreement and the rights and
obligations hereunder shall be governed by and construed in accordance with the laws of the State of Texas.
Section 409A. This Agreement shall be interpreted in accordance with the applicable requirements of, and exemptions from, Section 409A of the Code and the Treasury Regulations thereunder.
14. No Guarantee of Tax Consequences. None of the Company, its Affiliates or any of their officers, directors, employees or agents
are responsible for or guarantee the tax consequences to Executive with respect to any payments or benefits provided under this Agreement including, without limitation, any excise tax, interest or penalties that may be imposed under Code
[Signature page follows]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
PetroQuest Energy, Inc.,
a Delaware Corporation
|/s/ Charles T. Goodson|
Charles T. Goodson
President and Chief Executive Officer
/s/ Tracy Price