EMPLOYMENT AGREEMENT

 

      This Employment Agreement ("Agreement") executed by and between BOIS D'ARC

ENERGY, LLC, a Nevada limited liability company (the "Company") with principal

offices in Houston, Texas, and WAYNE L. LAUFER ("Employee").

 

      1.    Employment. The Company hereby agrees to employ Employee, and

Employee hereby agrees to render his service to the Company, in the capacity of

Chief Executive Officer of the Company, with such duties as may be assigned to

him from time to time by the Board of Managers or Board of Directors of the

Company (the "Board").

 

      2.    Term of Agreement. This Agreement shall be effective commencing on

July 16, 2004 (the effective date of this Agreement) and shall have a term of

three (3) years. This Agreement shall, as of its first anniversary, and on each

annual anniversary thereof, be extended automatically, without further action by

the Employee or the Company, for an additional one (1) year, so that there

shall, as of July 16 of each year, be three (3) years remaining in the term of

this Agreement (the "Employment Period"), subject to earlier termination as

hereinafter provided. This Agreement shall terminate upon the liquidation or

dissolution of the Company, and if the liquidation or dissolution is pursuant to

Section 17.7 of the Operating Agreement of the Company, then the parties shall

have no further obligations to each other, including, without limitation,

pursuant to Paragraph 14 of this Agreement (other than payment to the Employee

of accrued base salary through the date of termination, and as set forth in

Paragraph 8 of this Agreement).

 

      3.    Place of Employment. Unless otherwise agreed by the Company and

Employee, throughout the term of this Agreement, Employee's base of operations

shall be located in Houston, Texas; provided if Employee is located away from

the base of operations, the Company shall reimburse Employee for the reasonable

cost of such remote office and the travel back to the base of operations.

 

      4.    Base Compensation. Employee shall be compensated by the Company at a

minimum base rate of $30,000.00 per month, payable semi-monthly on the fifteenth

and final days of each month during the period of Employee's employment under

this Agreement, subject to such increases and additional payments as may be

determined from time to time by the Board in its sole discretion. Employee shall

also be entitled to participate in any Company discretionary bonus plan. Such

compensation shall be in addition to any group insurance, pension, profit

sharing, and other employee benefits, which are extended from time to time to

Employee (and Employee's spouse) in the discretion of the Board and for which

Employee is eligible. Subject to such rules and procedures as are from time to

time specified by the Company, the Company shall also reimburse Employee for all

reasonable expenses incurred by him on behalf of the Company.

 

      5.    Performance of Services. Employee shall devote substantially all of

his working time to the business of the Company; provided, however, Employee

shall be allowed to participate in non-operated working interest ownership in

oil and gas exploration and production

 

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activities onshore in the United States and in the state waters of the State of

Texas and shall be excused from performing any services for the Company

hereunder during periods of temporary incapacity and during vacations conforming

to the Company's standard vacation policy, without thereby in any way affecting

the compensation to which he is entitled hereunder.

 

      6.    Continuing Obligations. In order to induce the Company to enter into

this Agreement, the Employee hereby agrees that all documents, records,

techniques, business secrets and other information which have come into his

possession from time to time during his employment by the Company or which may

come into his possession during his employment hereunder, shall be deemed to be

confidential and proprietary to the Company and the Employee further agrees to

retain in confidence any confidential information known to him concerning the

Company and it's subsidiaries and their respective businesses so long as such

information is not publicly disclosed. In the event of a breach or threatened

breach by the Employee of the provisions of this Paragraph 6, the Company shall,

in addition to any other available remedies, be entitled to an injunction

restraining Employee from disclosing, in whole or in part, any such information

or from rendering any services to any person, firm or corporation to whom any of

such information may have been disclosed or is threatened to be disclosed.

 

      7.    Property of Company. All data, drawings, and other records and

written material prepared or compiled by Employee or furnished to Employee while

in the employ of the Company shall be the sole and exclusive property of the

Company, and none of such data, drawings or other records, or copies thereof,

shall be retained by Employee upon termination of his employment.

Notwithstanding the foregoing, Employee shall be under no obligation to return

public information.

 

      8.    Surviving Provisions. The provisions of Paragraphs 6 and 7 of this

Agreement shall continue to be binding upon Employee in accordance with their

terms, notwithstanding termination of Employee's employment hereunder for any

reason.

 

      9.    Death or Disability. The Employee's employment shall terminate

automatically upon the Employee's death during the Employment Period. If the

Company determines in good faith that the Disability of the Employee has

occurred during the Employment Period (pursuant to the definition of Disability

set forth below), it may give to the Employee written notice of its intention to

terminate the Employee's employment. In such event, the Employee's employment

with the Company shall terminate effective on the 30th day after receipt of such

notice by the Employee (the "Disability Effective Date"), provided that, within

the 30 days after such receipt, the Employee shall not have returned to

full-time performance of the Employee's duties. For purposes of this Agreement,

"Disability" shall mean the absence of the Employee from the Employee's duties

with the Company on a full-time basis for 150 consecutive business days as a

result of incapacity due to mental or physical illness which is determined to be

total and permanent by a physician selected by the Company or its insurers and

acceptable to the Employee or the Employee's legal representative.

 

      10.   Termination for Good Reason. The Employee's employment may be

terminated by the Employee for Good Reason. For purposes of this Agreement,

"Good Reason" shall mean:

 

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            (a)   the assignment to the Employee of any duties inconsistent in

                  any respect with the Employee's position (including status,

                  offices, titles and reporting requirements), authority, duties

                  or responsibilities as contemplated by Paragraph 1 of this

                  Agreement;

 

            (b)   any purported termination by the Company of the Employee's

                  employment otherwise than as expressly permitted by this

                  Agreement;

 

            (c)   any failure by the Company to comply with and satisfy

                  Paragraph 19(a) of this Agreement,

 

            (d)   the Company's requiring the Employee to reside in or be based

                  at any office or location other than as provided in Paragraph

                  3 of this Agreement, or

 

            (e)   following a Change in Control, the Company's requiring the

                  Employee to travel on Company business to a substantially

                  greater extent than during any period prior to the Change in

                  Control.

 

            Any good faith determination of "Good Reason" made by the Employee

shall be conclusive.

 

      11.   Termination for Cause. It is agreed and understood that the Company

cannot terminate the employment of the Employee under this Agreement except for

Cause, which shall mean:

 

            (a)   Should Employee for reasons other than illness or injury

                  absent himself from his duties without the consent of the

                  Company (which consent shall not be unreasonably withheld) for

                  more than twenty (20) consecutive business days;

 

            (b)   Should Employee be convicted of a felony involving moral

                  turpitude;

 

            (c)   Should Employee during the period of his employment by the

                  Company engage in any activity that would in the opinion of

                  the Board constitute a material conflict of interest with the

                  Company's oil and gas activities in the Gulf of Mexico;

                  provided that termination for Cause based on this subparagraph

                  (c) shall not be effective unless the Employee shall have

                  received written notice from the Board of such activity (which

                  notice shall also include a demand for the Employee to cease

                  the activity giving rise to the conflict of interest) thirty

                  (30) days prior to his termination and the Employee has failed

                  after receipt of such notice to cease or commence efforts to

                  cease all activities creating the conflict of interest; or

 

            (d)   Should Employee be grossly negligent in the performance of his

                  duties hereunder, or materially in breach of his duties and

                  obligations under this Agreement; provided that termination

                  for Cause based on this subparagraph (d) shall not be

                  effective unless the Employee shall have received written

                  notice from the Board (which notice shall include a

                  description of the

 

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<PAGE>

 

                  reasons and circumstances giving rise to such notice) thirty

                  (30) days prior to his termination and the Employee has failed

                  after receipt of such notice to satisfactorily discharge the

                  performance of his duties hereunder or to comply with the

                  terms of this Agreement, as the case may be.

 

The Company may terminate Employee's employment for Cause under this Agreement

without advance notice, except as otherwise specifically provided for in

subparagraphs (c) and (d) above. Termination shall not affect any of the

Company's other rights and remedies.

 

      12.   Obligations of the Company upon Termination.

 

            (a)   Good Reason or Involuntary Termination Other Than for Cause.

                  If, during the Employment Period, the Company shall terminate

                  the Employee's employment other than for Cause or the Employee

                  shall terminate employment for Good Reason, the Company shall

                  pay to the Employee in a lump sum in cash within 30 days after

                  the date of termination the aggregate of the following

                  amounts:

 

                  (1)   the sum of (A) the Employee's annual base salary through

                        the date of termination to the extent not theretofore

                        paid, (B) the product of the annual bonus paid or

                        payable, including any bonus or portion thereof which

                        has been earned but deferred (and annualized for any

                        fiscal year consisting of less than twelve full months

                        or during which the Employee was employed for less than

                        twelve full months), for the most recently completed

                        fiscal year during the Employment Period (the "Fiscal

                        Year Bonus"), if any, and a fraction, the numerator of

                        which is the number of days in the current fiscal year

                        through the date of termination, and the denominator of

                        which is 365, and (C) any compensation previously

                        deferred by the Employee (together with any accrued

                        interest or earnings thereon) and any accrued vacation

                        pay, in each case to the extent not theretofore paid

                        (the sum of the amounts described in clauses (A), (B)

                        and (C) shall be hereinafter referred to as the "Accrued

                        Obligations"); and

 

                  (2)   an amount equal to 1.5 times the sum of the Employee's

                        annual base salary and the Fiscal Year Bonus; and for

                        eighteen (18) months after the Employee's date of

                        termination, the Company shall continue group medical

                        benefits to the Employee and/or the Employee's family at

                        least equal to those which would have been provided to

                        them in accordance with the plans if the Employee's

                        employment had not been terminated; provided, however,

                        that if the Employee becomes re-employed with another

                        employer and is eligible to receive group medical

                        benefits under another employer-provided plan, the

                        medical benefits described herein shall be secondary to

                        those provided under such other plan during such

                        applicable period of eligibility.

 

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                  All options to purchase shares or units in the Company

                  ("Company Equity") and restricted shares or units of

                  Company Equity shall vest in Employee's account upon the

                  effective date of Employee's termination under this

                  Paragraph. The Company will use reasonable efforts to

                  obtain the release of the Employee's Company Equity from

                  any trading restrictions other than (i) restrictions

                  imposed by contractual obligations with third parties or

                  (ii) restrictions under state or federal securities

                  laws; provided, however, that in no event will the

                  Company be required to register any unregistered shares

                  under the Securities Act.

 

                  In addition, the Company shall, at its sole expense as

                  incurred, provide the Employee with outplacement

                  services, the scope and provider of which shall be

                  selected by the Employee in his sole discretion, and the

                  Company shall assign to the Employee ownership of any

                  life insurance policies owned by the Company insuring

                  the Employee's life.

 

            (b)   Death. If the Employee's employment is terminated by

                  reason of the Employee's death during the Employment

                  Period, the Company shall pay to the Employee's legal

                  representatives the sum of (1) the Accrued Obligations,

                  and (2) an amount equal to six months' annualized total

                  compensation. Such amounts shall be paid in a lump sum

                  in cash within 30 days of the date of termination.

 

            (c)   Disability. If the Employee's employment is terminated

                  by reason of the Employee's Disability during the

                  Employment Period, this Agreement shall terminate

                  without further obligations to the Employee, other than

                  for payment of Accrued Obligations. During the term of

                  this Agreement, the Company shall provide, at the

                  Company's expense, disability insurance for Employee

                  equal to sixty percent (60%) of Employee's Base

                  Compensation until Employee attains the age of

                  sixty-five (65) years. Accrued Obligations shall be paid

                  to the Employee in a lump sum in cash within 30 days of

                  the date of termination. In addition, the Company shall

                  assign to the Employee ownership of any life insurance

                  policies owned by the Company insuring the Employee's

                  life.

 

            (d)   Cause or Voluntary Termination Other than for Good

                  Reason. If the Employee's employment shall be terminated

                  for Cause during the Employment Period, or if the

                  Employee voluntarily terminates his employment other

                  than for Good Reason, this Agreement shall terminate

                  without further obligations to the Employee other than

                  the obligation to pay to the Employee his annual base

                  salary through the date of termination and the amount of

                  any compensation previously deferred by the Employee.

                  Such amounts shall be paid to the Employee in a lump sum

                  in cash within 30 days of the date of termination. If

                  the Employee voluntarily terminates his employment other

                  than for Good Reason on or after attaining the age of

                  sixty-one (61), all options to purchase Company Equity

                  and restricted shares

 

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<PAGE>

 

                  or units of Company Equity shall vest in Employee's account

                  upon the effective date of Employee's termination.

 

      13.   Change in Control. For the purposes of this Agreement, a "Change in

Control" shall mean:

 

            (a)   during any period of two consecutive years, individuals who at

                  the beginning of such period constituted the Board cease for

                  any reason to constitute a majority thereof (unless the

                  election, or nomination for election by holders of the Company

                  Equity, of such member of the Board was approved by a vote of

                  at least two-thirds (2/3) of the members of the Board then

                  still in office who either were members of the Board at the

                  beginning of such period or whose election or nomination for

                  election was previously so approved);

 

            (b)   a person, other than an "Excluded Person" as defined herein,

                  including a "group" as defined in Paragraph 13(d)(3) of the

                  Securities Exchange Act of 1934, becomes the beneficial owner

                  of shares of any class of the Company Equity having 25% or

                  more of the total number of votes that may be cast for the

                  election of members of the Board ; or

 

            (c)   consummation of a merger or other business combination of the

                  Company with or into another corporation pursuant to which the

                  Company does not survive or survives only as a subsidiary of

                  another entity, the sale or other disposition of all or

                  substantially all of the assets of the Company to another

                  person or entity, or any combination of the foregoing;

 

provided, however, that a Change in Control will not include (A) any Financing

Transaction (as defined in the Operating Agreement of the Company dated as of

July 16, 2004) and any transaction entered into in connection therewith, (B) any

reorganization, merger, consolidation, sale, lease, exchange or similar

transaction which involves solely the Company and one or more entities

wholly-owned, directly or indirectly, by the Company immediately prior to such

event, or (C) the consummation of any transaction or series of integrated

transactions immediately following which the record holders of the voting

Company Equity immediately prior to such transaction or series of transactions

continue to hold 50% or more of the voting securities of (i) any entity that

owns, directly or indirectly, the Company Equity, (ii) any entity with which the

Company has merged, or (iii) any entity that owns an entity with which the

Company has merged. For purposes hereof, (i) an "Excluded Person" shall mean an

original member of the Company or their affiliates, and (ii) a person will be

deemed to be the beneficial owner of any voting securities of the Company which

it would be considered to beneficially own under Securities and Exchange

Commission Rule 13d-3 (or any similar or superseding statute or rule from time

to time in effect).

 

      14.   Termination of Employment Following a Change of Control. Following a

Change of Control, if the Employee's employment is terminated for any reason

other than Cause, death or Disability, or if the Employee voluntarily terminates

his employment (a) within a period of six (6) months following the Change of

Control, or (b) for Good Reason, then the Company shall pay to the Employee the

Accrued Obligations and an amount equal to 2.99 times the sum

 

                                                                               6

<PAGE>

 

of the Employee's annual base salary and the highest annual bonus paid to the

Employee during the Employee's tenure with the Company; and for eighteen (18)

months after the Employee's date of termination, the Company shall continue

group medical benefits to the Employee and/or the Employee's family at least

equal to those which would have been provided to them in accordance with the

plans if the Employee's employment had not been terminated; provided, however,

that if the Employee becomes re-employed with another employer and is eligible

to receive group medical benefits under another employer provided plan, the

medical benefits described herein shall be secondary to those provided under

such other plan during such applicable period of eligibility. In addition, the

Company shall, at its sole expense as incurred, provide the Employee with

outplacement services, the scope and provider of which shall be selected by the

Employee in his sole discretion, and the Company shall assign to the Employee

ownership of any life insurance policies owned by the Company insuring the

Employee's life

 

      15.   Certain Additional Payments by the Company.

 

            (a)   Anything in this Agreement to the contrary notwithstanding and

                  except as set forth below, in the event it shall be determined

                  that any payment or distribution by the Company to or for the

                  benefit of the Employee (whether paid or payable or

                  distributed or distributable pursuant to the terms of this

                  Agreement or otherwise, but determined without regard to any

                  additional payments required under this Paragraph 15) (a

                  "Payment") would be subject to the excise tax imposed by

                  Section 4999 of the Code or any interest or penalties are

                  incurred by the Employee with respect to such excise tax (such

                  excise tax, together with any such interest and penalties, are

                  hereinafter collectively referred to as the "Excise Tax"),

                  then the Employee shall be entitled to receive an additional

                  payment (a "Gross-Up Payment") in an amount such that after

                  payment by the Employee of all taxes (including any interest

                  or penalties imposed with respect to such taxes), including,

                  without limitation, any income taxes (and any interest and

                  penalties imposed with respect thereto) and Excise Tax imposed

                  upon the Gross-Up Payment, the Employee retains an amount of

                  the Gross-Up Payment equal to the Excise Tax imposed upon the

                  Payments.

 

            (b)   Subject to the provisions of Paragraph 15(c), all

                  determinations required to be made under this Paragraph 15,

                  including whether and when a Gross-Up Payment is required and

                  the amount of such Gross-Up Payment and the assumptions to be

                  utilized in arriving at such determination, shall be made by

                  Ernst & Young LLP or such other certified public accounting

                  firm as may be designated by the Employee (the "Accounting

                  Firm") which shall provide detailed supporting calculations

                  both to the Company and the Employee within 15 business days

                  of the receipt of notice from the Employee that there has been

                  a Payment, or such earlier time as is requested by the

                  Company. In the event that the Accounting Firm is serving as

                  accountant or auditor for the individual, entity or group

                  effecting the Change in Control, the Employee shall appoint

                  another nationally recognized accounting firm to make the

                  determinations required hereunder (which accounting firm shall

                  then be referred to as the Accounting Firm hereunder). All

                  fees and expenses of the

 

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                  Accounting Firm shall be borne solely by the Company. Any

                  Gross-Up Payment, as determined pursuant to this Paragraph 15

                  shall be paid by the Company to the Employee within five days

                  of the receipt of the Accounting Firm's determination. Any

                  determination by the Accounting Firm shall be binding upon the

                  Company and the Employee. As a result of the uncertainty in

                  the application of Section 4999 of the Code at the time of the

                  initial determination by the Accounting Firm hereunder, it is

                  possible that Gross-Up Payments which will not have been made

                  by the Company should have been made ("Underpayment"),

                  consistent with the calculations required to be made

                  hereunder. In the event that the Company exhausts its remedies

                  pursuant to Paragraph 15(c) and the Employee thereafter is

                  required to make a payment of any Excise Tax, the Accounting

                  Firm shall determine the amount of the Underpayment that has

                  occurred and any such Underpayment shall be promptly paid by

                  the Company to or for the benefit of the Employee.

 

            (c)   The Employee shall notify the Company in writing of any

                  claim by the Internal Revenue Service that, if successful,

                  would require the payment by the Company of the Gross-Up

                  Payment. Such notification shall be given as soon as

                  practicable but no later than ten business days after the

                  Employee is informed in writing of such claim and shall

                  apprise the Company of the nature of such claim and the date

                  on which such claim is requested to be paid. The Employee

                  shall not pay such claim prior to the expiration of the 30-day

                  period following the date on which it gives such notice to the

                  Company (or such shorter period ending on the date that any

                  payment of taxes with respect to such claim is due). If the

                  Company notifies the Employee in writing prior to the

                  expiration of such period that it desires to contest such

                  claim, the Employee shall:

 

                  (1)   give the Company any information reasonably requested by

                        the Company relating to such claim,

 

                  (2)   take such action in connection with contesting such

                        claim as the Company shall reasonably request in writing

                        from time to time, including, without limitation,

                        accepting legal representation with respect to such

                        claim by an attorney reasonably selected by the Company,

 

                  (3)   cooperate with the Company in good faith in order

                        effectively to contest such claim, and

 

                  (4)   permit the Company to participate in any proceedings

                        relating to such claim;

 

                  provided, however, that the Company shall bear and pay

                  directly all costs and expenses (including additional interest

                  and penalties) incurred in connection with such contest and

                  shall indemnify and hold the Employee

 

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                  harmless, on an after-tax basis, for any Excise Tax or income

                  tax (including interest and penalties with respect thereto)

                  imposed as a result of such representation and payment of

                  costs and expenses. Without limitation of the foregoing

                  provisions of this Paragraph 15(c), the Company shall control

                  all proceedings taken in connection with such contest and, at

                  its sole option, may pursue or forego any and all

                  administrative appeals, proceedings, hearings and conferences

                  with the taxing authority in respect of such claim and may, at

                  its sole option, either direct the Employee to pay the tax

                  claimed and sue for a refund or contest the claim in any

                  permissible manner, and the Employee agrees to prosecute such

                  contest to a determination before any administrative tribunal,

                  in a court of initial jurisdiction and in one or more

                  appellate courts, as the Company shall determine; provided,

                  however, that if the Company directs the Employee to pay such

                  claim and sue for a refund, the Company shall advance the

                  amount of such payment to the Employee, on an interest-free

                  basis and shall indemnify and hold the Employee harmless, on

                  an after-tax basis, from any Excise Tax or income tax

                  (including interest or penalties with respect thereto) imposed

                  with respect to such advance or with respect to any imputed

                  income with respect to such advance; and further provided that

                  any extension of the statute of limitations relating to

                  payment of taxes for the taxable year of the Employee with

                  respect to which such contested amount is claimed to be due is

                  limited solely to such contested amount. Furthermore, the

                  Company's control of the contest shall be limited to issues

                  with respect to which a Gross-Up Payment would be payable

                  hereunder and the Employee shall be entitled to settle or

                  contest, as the case may be, any other issue raised by the

                  Internal Revenue Service or any other taxing authority.

 

            (d)   If, after the receipt by the Employee of an amount advanced by

                  the Company pursuant to Paragraph 15(c), the Employee becomes

                  entitled to receive any refund with respect to such claim, the

                  Employee shall (subject to the Company's complying with the

                  requirements of Paragraph 15(c)) promptly pay to the Company

                  the amount of such refund (together with any interest paid or

                  credited thereon after taxes applicable thereto). If, after

                  the receipt by the Employee of an amount advanced by the

                  Company pursuant to Paragraph 15(c), a determination is made

                  that the Employee shall not be entitled to any refund with

                  respect to such claim and the Company does not notify the

                  Employee in writing of its intent to contest such denial of

                  refund prior to the expiration of 30 days after such

                  determination, then such advance shall be forgiven and shall

                  not be required to be repaid and the amount of such advance

                  shall offset, to the extent thereof, the amount of Gross-Up

                  Payment required to be paid.

 

      16.   Payment of Certain Costs of Employee. If a dispute arises regarding

the interpretation or enforcement of this Agreement, all legal fees and expenses

incurred by the Employee in seeking to obtain or enforce any right or benefit

provided for in this Agreement or in otherwise pursuing his claim will be paid

by the Company, to the extent permitted by law. The Company further agrees to

pay prejudgment interest on any money judgment obtained by

 

                                                                               9

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the Employee calculated at the First National Bank of Chicago N.A. prime

interest rate in effect from time to time from the date that payment(s) to him

should have been made under this Agreement.

 

      17.   Indemnification; Directors, Managers and Officers Insurance. The

Company shall (a) during the Employment Period and thereafter without limitation

of time, indemnify and advance expenses to the Employee to the fullest extent

permitted by the laws of the State of Nevada from time to time in effect and (b)

during the Employment Period, acquire and maintain directors, managers and

officers liability insurance covering the Employee (and to the extent the

Company desires, other directors, managers and officers of the Company and its

affiliated companies) to the extent it is available at commercially reasonable

rates as determined by the Board ; provided, however, that in no event shall the

Employee be entitled to indemnification or advancement of expenses under this

Paragraph 17 with respect to any proceeding, or matter therein, brought or made

by the Employee against the Company other than one initiated by the Employee to

enforce the Employee's advancement of expenses as provided in this Paragraph 17

shall not be deemed exclusive of any other rights to which the Employee may at

any time be entitled under applicable law, the articles of incorporation or

bylaws of the Company, any agreement, a vote of security holders, a resolution

of the Board , or otherwise. The provisions of this Paragraph 17 shall continue

in effect notwithstanding termination of the Employee's employment hereunder for

any reason, including, without limitation, Employee's voluntary termination. In

furtherance thereof, and not by way of limitation, the Company shall reimburse

Employee for all reasonable legal fees and expenses incurred by Employee in

connection with Employee's obtaining and enforcing any right or benefit provided

by this Agreement. The reimbursement of such legal fees and expenses shall be

made within 30 days after Employee's request for payment accompanied by evidence

of the fees and expenses incurred. For a period of ten (10) years after the

termination, for any reason, of Employee's employment with the Company, the

Company shall indemnify, hold harmless and defend Employee, to the fullest

extent permitted by applicable law, from and against any loss, cost or expense

related to or arising out of any action or claim with respect to (i) the Company

or its affiliated companies or (ii) any action taken or omitted by the Employee

(INCLUDING, BUT NOT LIMITED TO, MATTERS THAT CONSTITUTE NEGLIGENCE OF THE

EMPLOYEE) for or on behalf of the Company or its affiliated companies, whether,

in either case, such action or claim, or the facts and circumstances giving rise

thereto, occurred or accrued before or after such termination of employment.

 

      18.   Mitigation. The Employee is not required to mitigate the amount of

any payments to be made by the Company pursuant to this Agreement by seeking

other employment or otherwise.

 

      19.   Successors.

 

            (a)   Except as may otherwise be provided under any other written

                  agreement between the Company and the Employee with respect to

                  the terms of Employee's employment in the event of a Change of

                  Control of the Company, the Company will require any successor

                  (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

 

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                  in form and substance satisfactory to the Employee, to

                  expressly 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 had taken place.

                  Failure of the Company to obtain such agreement prior to the

                  effectiveness of any such succession shall be a breach of this

                  Agreement. Notwithstanding the foregoing, upon a conversion of

                  the Company to a "C" corporation pursuant to the Plan of

                  Conversion attached as Exhibit B to the Operating Agreement of

                  the Company, the converted corporation shall by operation of

                  law assume this Agreement with no further action on the part

                  of the Company or the Employee. As used in this Agreement,

                  "Company" shall mean the Company as hereinbefore defined, any

                  successor to its business and/or assets as aforesaid which

                  executes and delivers the agreement provided for in this

                  Paragraph 19 or which otherwise becomes bound by all the terms

                  and provisions of this Agreement by operation of law.

 

            (b)   This Agreement shall inure to the benefit of and be

                  enforceable by the Employee's personal or legal

                  representatives, executors, administrators, successors, heirs,

                  distributees, devisees and legatees.

 

      20.   No Inconsistent Obligations. Employee represents and warrants that

he has not previously assumed any obligations inconsistent with those of this

Agreement except as otherwise permitted pursuant to Paragraph 5 above.

 

      21.   Modification. This Agreement shall be in addition to all previous

agreements, written or oral, relating to Employee's employment by the Company,

and shall not be changed orally, but only by a written instrument to which the

Company and the Employee are both parties.

 

      22.   Binding Effect. This Agreement and the rights and obligations

hereunder shall be binding upon and inure to the benefit of the parties hereto

and their respective legal representatives, and shall also bind and inure to the

benefit of any successor of the Company by merger or consolidation or any

assignee of all or substantially all of its properties.

 

      23.   Bankruptcy. Notwithstanding anything in this Agreement to the

contrary, the insolvency or adjudication of bankruptcy of the Company, whether

voluntary or involuntary, shall terminate this Agreement and the rights and

obligations of Company and Employee hereunder shall be of no further force or

effect.

 

      24.   Law Governing. This Agreement made, accepted and delivered in Harris

County, Texas, is performable in Harris County, Texas, and it shall be construed

and enforced according to the laws of the State of Texas. Venue shall lie in

Harris County, Texas for the purpose of resolving and enforcing any dispute

which may arise under this Agreement and the parties agree that they will submit

themselves to the jurisdiction of the competent State or Federal Court situated

in Harris County, Texas.

 

      25.   Invalid Provision. In case any one or more of the provisions

contained in this Agreement shall be invalid, illegal or unenforceable in any

respect, the validity, legality and

 

                                                                              11

<PAGE>

 

enforceability of the remaining provisions contained herein shall not in any way

be impaired thereby.

 

      26.   Notices. For purposes of this Agreement, notices and all other

communications provided for herein shall be in writing and shall be deemed to

have been duly given when delivered or mailed by United States registered or

certified mail, return receipt requested, postage prepaid, addressed as follows:

 

            IF TO THE EMPLOYEE:

 

            Wayne L. Laufer

            600 Travis, Suite 6275

            Houston, TX 77022

 

            IF TO THE COMPANY:

 

            BOIS D'ARC ENERGY, LLC

            600 Travis, Suite 6275

            Houston, TX 77022

 

            With a copy to:

            Comstock Resources, Inc.

            Attention: Chief Financial Officer

            5300 Town and Country Blvd., Suite 500

            Frisco, Texas 75034

 

or to 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.

 

                            [Signature page follows.]

 

                                                                              12

<PAGE>

 

      EXECUTED and effective as of the 16th day of July, 2004.

 

                                      BOIS D'ARC ENERGY, LLC

 

                                      By: /s/ Gary W. Blackie

                                         -----------------------------------

                                      Name: Gary W. Blackie

                                      Title: President

 

                                      EMPLOYEE:

 

                                      /s/ Wayne L. Laufer

                                      --------------------------------------

                                      Wayne L. Laufer