ASSIGNMENT AND AMENDMENT AGREEMENT
Exhibit 10.12
This ASSIGNMENT AND AMENDMENT AGREEMENT (this “Agreement”), by and among Quest Resource
Corporation (“QRC”), PostRock Energy Corporation (“PostRock”), and Xxxxx XxXxxxx (“Employee”),
effective as of the date of the consummation of the transactions contemplated by the Agreement and
Plan of Merger dated July 2, 2009, among PostRock, QRC, Quest Midstream Partners, L.P., QuestEnergy
Partners, L.P., Quest Midstream GP, LLC, Quest Energy GP, LLC, Quest Resource Acquisition Corp.,
Quest Energy Acquisition, LLC, and Quest Midstream Acquisition, LLC, as amended (the “Effective
Date”) (such transactions collectively, the “Recombination”), is an amendment to, and assignment
of, that certain Employment Agreement by and between QRC and Employee dated December 7, 2009 (the
“Employment Agreement”).
RECITALS
WHEREAS, QRC and Employee have previously entered into the Employment Agreement to provide for
terms and conditions of Employee’s employment by QRC;
WHEREAS, in connection with the Recombination, QRC shall be a wholly-owned subsidiary of
PostRock and shall be renamed PostRock Energy Service Corporation;
WHEREAS, QRC, PostRock and Employee desire that Employee should continue to be employed by
PostRock on substantially the same terms as currently provided in the Employment Agreement;
WHEREAS, QRC, PostRock, and Employee desire to assign the Employment Agreement to PostRock and
desire to amend the Employment Agreement to reflect such assignment.
NOW, THEREFORE, the parties hereby agree to amend and assign the Employment Agreement,
effective as of the Effective Date, as follows:
I. ASSIGNMENT
QRC hereby assigns to PostRock, and PostRock hereby assumes, all rights, obligations and
liabilities of QRC under the Employment Agreement, and Employee acknowledges and consents to such
assignment and assumption.
II. AMENDMENTS
1. The Recital in the Employment Agreement is hereby amended to replace the phrase “QUEST
RESOURCE CORPORATION (the ‘Company’)” with “POSTROCK ENERGY CORPORATION (the ‘Company’).”
2. The second sentence of Section 1(a) of the Employment Agreement is hereby amended to read
as follows:
“Employee will serve as Chief Financial Officer of the Company.”
3. Section 1(b) of the Employment Agreement is hereby amended to read as follows:
“b. Duties. Employee agrees that so long as he is employed pursuant to
this Agreement, he will: (i) to the satisfaction of the Company, devote his best
efforts and his entire business time to further properly the interests of the
Company and its subsidiaries (together, the ‘Company Group’); (ii) at all times be
subject to the direction and control of the Chief Executive Officer and the Board of
Directors of the Company with respect to his activities on behalf of the Company
Group; (iii) comply with all rules, orders and regulations of the Company and all
statutes, regulations, interpretive rulings and other enactments to which the
Company is subject; (iv) truthfully and accurately maintain and preserve such
records and make all reports as the Company may require; (v) fully account for all
Company Group monies which he may from time to time have custody over and deliver
the same to the Company whenever and however directed to do so; and (vi) perform
such other duties as may be requested or assigned to him from time to time by the
Chief Executive Officer and the Board of Directors of the Company.”
4. The third and fourth sentences of Section 2(b) of the Employment Agreement are hereby
amended to read as follows:
“Employee’s actual bonus level will be contingent upon the achievement of
predetermined financial results and the Board’s (and/or Compensation Committee’s)
approval thereof, including approval of any components based on the Company, the
Company Group or individual performance. Employee acknowledges that actual payouts
under the plan may be more or less than
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Employee’s target level based on performance as compared to Company Group, Company
and Employee’s individual objectives.”
5. QRC, PostRock and Employee hereby acknowledge and agree that none of the consummation of
the transactions in the Recombination or the actions contemplated thereby nor the assignment of the
Employment Agreement constitutes “Good Reason” under the Employment Agreement.
6. All references to “the Company” in the second, fourth and sixth clauses of the third
sentence of Section 6(b) of the Employment Agreement are hereby amended to refer to “the Company
Group.”
7. Section 6 of the Employment Agreement is hereby amended by adding a new subsection (d)
thereto which shall read as follows:
“d. Employee’s Separation from Service. For the avoidance of doubt,
termination of employment for purposes of this Agreement shall not be deemed to
have occurred until Employee has terminated employment with the Company and all
members of the Company Group, for so long as such entities are considered a single
service recipient for purposes of determining whether a ‘separation from service’
has occurred under § 409A.”
8. The address of the Company in Section 7 of the Employment Agreement is hereby amended to
read as follows:
PostRock Energy Corporation
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
cc: Chairman of the Board of Directors
Facsimile: (000) 000-0000
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
cc: Chairman of the Board of Directors
Facsimile: (000) 000-0000
9. All references to “the Company” in Section 8 (Company Property), Section 9 (Intellectual
Property), Section 14 (Conflicts of Interest), Section 15 (Confidentiality; Non-Competition) of the
Employment Agreement are hereby amended to refer to “the Company Group.”
10. The first two sentences of Section 26 of the Employment Agreement are hereby amended to
read as follows:
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“It is the intent of the parties that the benefits under this Agreement comply with
or be exempt from § 409A and the Treasury regulations and guidance issued
thereunder. Accordingly, the parties intend that the provisions of this Agreement
be interpreted and operated consistent with such requirements of § 409A in order to
avoid the application of additive taxes under § 409A to the extent reasonably
practicable.”
11. Except as amended and assigned above, the Employment Agreement remains in full force and
effect.
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IN WITNESS WHEREOF, Quest Resource Corporation and PostRock Energy Corporation have caused
this Agreement to be executed by their duly authorized officers and Employee has signed this
Agreement, on March 5, 2010, but effective as of the Effective Date.
QUEST RESOURCE CORPORATION | ||||||
By: | /s/ Xxxxx Xxxxxx | |||||
Name: | ||||||
Title: | President and Chief Executive Officer | |||||
POSTROCK ENERGY CORPORATION | ||||||
By: | /s/ Xxxx Xxxxxxx | |||||
Name: | Xxxx Xxxxxxx | |||||
Title: | Chairman of the Board | |||||
EMPLOYEE | ||||||
/s/ Xxxxx XxXxxxx |
||||||
Xxxxx XxXxxxx |
Signature page to XxXxxxx Employment Agreement Amendment