NGAS Resources, Inc. FORM OF AMENDMENT TO CHANGE OF CONTROL AGREEMENT
FORM
OF AMENDMENT TO CHANGE OF CONTROL AGREEMENT
This
AMENDMENT TO CHANGE OF CONTROL AGREEMENT (the “Amendment”) is
entered into as of December 23, 2010 between NGAS
Resources, Inc., a British Columbia corporation formerly named Xxxxxxxxx
Resources, Inc. (the “Company”), and ______________,
the ______________ of the Company (the “Executive”).
The
parties entered into a Change of Control Agreement dated as of February 25,
2004 (the “Change of
Control Agreement”), pursuant to which Executive is entitled to a
termination settlement payment in the event that, within five years following
any Change of Control, the Executive’s employment with the Company is terminated
by the Company other than for Cause or by the Executive for Good Reason or by
the death or Disability of Executive (as those terms are defined in the Change
of Control Agreement). The parties desire to amend the Change of
Control Agreement as set forth below to ensure documentary compliance with
Section 409A of the Internal Revenue Code of 1986, as amended.
NOW,
THEREFORE, in consideration of the foregoing, the parties agree as
follows:
1. Section
3 of the Change of Control Agreement is hereby amended and restated as follows
to provide that Executive’s termination settlement, to the extent it is required
to be paid, shall be made in a single lump sum and no longer in periodic
installments at the election of Executive:
“3
Settlement
Payment. The termination settlement provided under Section 2 shall be
payable by the Company in cash in a single lump sum on the effective date of
employment termination, subject to any applicable withholding
taxes. The payment provided herein is intended as a termination
settlement and not as salary continuation.”
2. The
following new paragraph is hereby added after Section 10 of the Change of
Control Agreement:
“11. Section
409A. The intent of the parties is that payments and benefits
under this Agreement (including all attachments, exhibits and annexes) comply
with Section 409A of the Internal Revenue Code of 1986, as amended (“Code
Section 409A”), to the extent subject
thereto. Accordingly, to the maximum extent permitted, this Agreement
shall be interpreted and be administered to be in compliance with Code
Section 409A in all respects. Notwithstanding anything to the
contrary in this Agreement, to the extent required in order to avoid accelerated
taxation and/or tax penalties under Code Section 409A, the Executive shall
not be considered to have terminated employment with the Company or its
subsidiaries for purposes of this Agreement, and no payment shall be due to the
Executive under this Agreement, until the Executive would be considered to have
incurred a “separation from service” from the Company and its subsidiaries
within the meaning of Code Section 409A. In addition,
notwithstanding anything to the contrary in this Agreement, to the extent that
any payments to be made upon the Executive’s separation from service would
result in the imposition of any individual penalty tax imposed under Code
Section 409A, the payment shall instead be made on the first business day
after the earlier of (a) the date that is six (6) months following such
separation from service and (b) the Executive’s death.”
3. The
Change of Control Agreement, as expressly modified hereby, shall remain in full
force and effect.
1
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
and year first above written.
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NGAS
RESOURCES, INC.
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By
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EXECUTIVE:
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