Employment Agreement

First Amendment to Employment Agreement

Second Amendment to Employment Agreement

Third Amendment to Employment Agreement

Executive Severance Compensation Plan

 

 

 

EMPLOYMENT AGREEMENT

 

 

This employment agreement is dated as of February 1, 2004 (the “Agreement”) between Questar Corporation, a Utah corporation (“Company”), and Keith O. Rattie (“Executive”).

 

WHEREAS, Executive currently serves the Company as Chairman, President and Chief Executive Officer and the Company wants him to continue serving in this role upon the terms and subject to the conditions set forth in this Agreement.

 

NOW, THEREFORE, the Company and Executive hereby agree as follows:

 

ARTICLE 1

DEFINITIONS

 

The terms set forth below have the following meanings:

 

Agreement Date means the effective date of this Agreement.

 

Anniversary Date means any annual anniversary of the Agreement Date.

 

Board means the Board of Directors of the Company

 

Cause means any of the following: (a) Executive’s conviction of a felony or of a misdemeanor involving fraud, dishonesty or moral turpitude, or (b) Executive’s willful or intentional material breach of this Agreement that results in financial detriment that is material to the Company and its Affiliates taken as a whole.

 

For purposes of clause (b) of the preceding sentence, Cause shall not include any one or more of the following: (i) bad judgment, (ii) negligence, (iii) any act or omission that Executive believed in good faith to have been in or not opposed to the interest of the Company (without intent of Executive to gain, directly or indirectly, a profit to which he was not legally entitled), or (iv) any act or omission of which any member of the Board who is not a party to such act or omission has had actual knowledge for at least 12 months.

 

Change in Control means the following: A Change in Control of the Company shall be deemed to have occurred if (a) any “Acquiring Person” (as such term is defined in the Rights Agreement dated as of February 13, 1996, between the Company and U.S. Bank, N.A. (“Rights Agreement”)) is or becomes the beneficial owner (as such term is sued in Rule 13d-3 under the Securities Exchange Act of 1934) of securities of the Company representing 25 percent or more of the combined voting power of the Company; or (b) the following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who, as of May 19, 1998 , constitute the Company’s Board of Directors (“Board”) and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s stockholders was approved or recommended by a vote of at least two-thirds of the directors then still in office who either were directors on May 19, 1998, or whose appointment, election or nomination for election was previously so approved or recommended; or (c) the Company’s stockholders approve a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 60 percent of the combined voting power of the securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation, or a merger or consolidation effected to implement a recapitalization of the Company for similar transaction) in which no person is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing 25 percent or more of the combined voting power of the Company’s then outstanding securities; or (d) the Company’s stockholders approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 60 percent of the combined voting power of the voting securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.  A Change in Control, however, shall  not be considered to have occurred until all conditions precedent to the transaction, including but not limited to, all required regulatory approvals, have been obtained.

 

Committee means the Management Performance Committee of the Board.

 

Common Stock means the common stock of the Company.

 

Company means Questar Corporation.

 

Date of Termination means the effective date of a Termination of Employment for any reason, including death or Disability, whether initiated by the Company or by Executive.

 

Disability means a mental or physical condition that, in the opinion of the Board, renders Executive unable or incompetent to carry out the material job responsibilities that such Executive held or the material duties to which Executive was assigned at the time the Disability was incurred, which has existed for at least three months and which in the opinion of a physician mutually agreed upon by the Company and Executive (provided that neither party shall unreasonably withhold his agreement) is expected to be permanent or to last for an indefinite duration or a duration in excess of six months and to result in Executive's Termination of Employment.

 

Employment Period means that subject to termination provisions, the term of Executive’s employment under this Agreement (the “Employment Period”) shall begin on the Agreement Date and end on the Anniversary Date that is three years after such date or as such date may be extended by the terms of this Agreement.  

 

Good Reason means the occurrence of any one or more of the following events unless Executive specifically agrees in writing that such event shall not be Good Reason: (a) any material breach of this Agreement by the Company, including but not limited to: any material adverse change in the status, responsibilities or perquisites of Executive; any failure to appoint   or nominate Executive as Chief Executive Officer of the Company or as member of the Board; assignment of duties materially inconsistent with his position and duties; or (b) notice by the Board of its intent not to extend this Agreement pursuant to Article 3, and/or (c) the failure of the Company to assign this Agreement to a successor to the Company or failure of a successor of the Company to explicitly assume and agree to be bound by this Agreement. Any reasonable determination by Executive that any of the specified events has occurred and constitutes Good Reason shall be conclusive and binding for all purposes.

 

Retention Stock Grant means any grants of restricted stock, options to purchase shares of the Company's common stock, stock appreciation rights, or other equity-based awards made to Executive as of or after February 10, 2004.  

 

Subsidiary means any entity of which the Company, directly or indirectly, owns at least 50 percent of the outstanding shares of capital stock entitled to vote for the election of directors.

 

Termination For Good Reason means a Termination of Employment by Executive for a Good Reason.

 

Termination of Employment means a termination by the Company or by Executive of Executive’s employment by the Company.

 

Termination Without Cause means a Termination of Employment by the Company for any reason other than Cause or Executive’s death or Disability.

 

ARTICLE 2

DUTIES

 

Chief Executive Officer Duties.  The Company shall employ Executive during the Employment Period as its President and Chief Executive Officer, reporting to the Board.  At its discretion, the Board of Directors of any Subsidiary may appoint Executive to serve in other capacities with the Company’s Subsidiaries.  Executive, during the Employment Period, shall devote substantially all of his business time, attention, and effort to the affairs of the Company and shall use his reasonable efforts to promote the best interests of the Company.

 

Director Duties.  As long as Executive serves as an employee or officer, the Board shall continue to nominate Executive for election as a Director of the Company.   At its discretion, the Board of Directors of any Subsidiary may appoint Executive to serve as a director of such Subsidiary.

 

 

 

 

ARTICLE 3

EMPLOYMENT PERIOD

 

Employment Period.  Subject to termination provisions, the term of Executive's employment under this Agreement (the "Employment Period") shall begin on the Agreement Date and end on the Anniversary Date that is three years after such date.  Unless the Board provides notice to Executive at least 30 days prior to any given Anniversary Date under this Agreement or Executive provides notice to the Board at least 30 days prior to any such date that the Employment Period will not be extended, the Employment Period will be extended for an additional one-year period.

 

ARTICLE 4

COMPENSATION

 

Salary.  The Company shall pay Executive an annual base salary of $510,000, payable in semi-monthly installments (“Base Salary”) ($540,000 as of March 1, 2004).  The Committee shall review Executive’s Base Salary when it reviews the base salaries paid to the Company’s other executive officers in February of each year and can only increase, not reduce, Executive’s Base Salary.  Effective as of the date of any such increase in Executive's Base Salary, the Base Salary shall be considered the new Base Salary for all purposes of this Agreement and may not thereafter be reduced.  Any increase in Base Salary shall not limit or reduce any other obligation of the Company to Executive under this Agreement without Executive's written consent.  The Committee shall also determine how to allocate Executive’s Base Salary among the Company and its principal Subsidiaries.

 

Annual Bonus.  Executive shall be nominated to participate in the Company’s Annual Management Incentive Plan (“AMIP”) for each year of the Employment Period and shall have a Target Bonus equal to at least 75 percent of his base salary at the time the target bonus is set (“Target Bonus”).  The annual minimum, target, and maximum performance goals for the Company and its principal Subsidiaries shall be approved by the Committee each year within 90 days after the beginning of such year.

 

Other Bonus Programs.   Executive shall be nominated to participate in the Long-term Cash Incentive Plan ("Cash Incentive Plan"), and any additional incentive compensation program adopted by the Committee or the Board for the Company's officers.  Unless Executive consents in writing or unless the special program is for specific hiring or retention purposes, Executive shall be granted at least a target bonus or award equal to that provided to any other officer.

 

ARTICLE 5

STOCK OPTIONS, RESTRICTED

STOCK AND STOCK OWNERSHIP

 

Equity Grants.  Executive shall be granted stock options, restricted stock awards, stock appreciation rights, performance shares, or other equity based compensation pursuant to the Company's Long-term Stock Incentive Plan ("Stock Plan") when the Committee or Board make such awards to other officers of the Company.  Unless  Executive consents in writing or unless the awards are for specific hiring or retention purposes, Executive shall be granted at least an equity award equal to that provided to any other officer.  The agreements for any options granted to Executive shall contain a special provision that permits Executive to have 30 days after Termination of Employment (for reasons other than death, Disability, approved retirement, or a Change in Control) to exercise the vested portion of any options granted to him.  (If Executive’s employment is terminated for one of the specified reasons, he shall have longer periods of time in which to exercise his options.)  

 

Stock Ownership.  The Company requires all officers to own shares of the Company’s common stock.  During the course of this Agreement,  Executive is expected to acquire and retain shares of the Company's common stock (including phantom stock units) having a value equal to at least three times his annual base salary.  Executive cannot sell shares of common stock other than to satisfy tax obligations associated with recognizing income in conjunction with stock distributions or stock options without advance notice to the lead director of the Board.

 

ARTICLE 6

OTHER BENEFITS

 

Qualified Retirement Plans.  During the Employment Period, Executive shall be entitled to participate in the qualified plans (including defined benefit and 401(k) savings) sponsored by the Company in accordance with the general rules applicable to other employees participating in such plans.

 

Welfare Benefit Plans.  During the Employment Period, Executive shall be eligible to participate in the welfare benefit plans and programs (including health, life insurance, catastrophe accident, cafeteria, disability, approved personal leave) sponsored by the Company in accordance with the general rules applicable to such plans.

 

Vacation.  During the Employment Period, Executive shall be entitled to paid vacation time in accordance with the Company’s general rules, except that Executive shall have the right to four weeks of paid vacation in each anniversary year.  After Executive has five anniversary years, he shall be entitled to five weeks of paid vacation in each anniversary year.

 

Nonqualified Benefit Plans.  During the Employment Period, Executive shall be eligible to participate in the Company’s optional nonqualified plans such as the Deferred Share Make-up Plan, the Deferred Compensation Plan, and the Deferred Share Plan (Collectively referred to as the “Deferred Compensation Plans”) and shall be covered by the Company’s nonqualified plan—the Supplemental Executive Retirement Plan (the “SERP”)—to make-up the difference between what can be earned by and paid to Executive under the Company’s qualified deferred benefit plan and what could be earned by and paid to Executive under such plan in the absence of federal tax law limitations applicable to it.  

 

Change in Control/Indemnification.  Executive shall be nominated to participate in the Company’s Executive Severance Compensation Plan (“Change in Control Plan”) and shall also be given an Indemnification Agreement.  

 

Other Benefits.  During the Employment Period, Executive shall be entitled to participate in the Company’s special tax preparation and financial planning reimbursement program available to the Company’s officers.  Executive shall also be entitled to participate in any special programs adopted for the Company’s executive officers.

 

Office and Support Staff.  During the Employment Period, Executive shall be entitled to an office and secretarial assistance appropriate to his position.

 

Expenses.  During the Employment Period, Executive shall be entitled to receive prompt reimbursement for all reasonable employment-related expenses incurred by him and approved in accordance with the Company’s standard policies.

 

ARTICLE 7

TERMINATION OF EMPLOYMENT

 

Termination for Cause.  If the Company terminates Executive’s employment for Cause, the Company shall only be required to pay Executive any earned but unpaid base salary and vacation benefits.

 

The Company may not terminate Executive’s employment for Cause unless it has: (a) officially given Executive written notice at least 30 days prior to the Date of Termination of its intent to terminate Executive’s employment, which written notice shall contain a detailed description of the specific reasons that form the basis for such action; (b) provided Executive an opportunity to appear before the Board prior to the Date of Termination to present arguments on his own behalf; and (c) received the affirmative vote of at least two-thirds of the members of the Board that it is proper to terminate Executive’s employment for Cause.  Pending the final resolution of any disputes concerning Executive’s termination of employment for Cause, the Board may suspend Executive with pay.

 

Termination for Death or Disability.  If Executive’s employment terminates during the Employment Period due to his death or Disability, the Company shall pay to Executive's beneficiaries (in the event of his death) or to Executive (in the event of his Disability), a lump-sum equal to Executive's monthly Base Salary for one month following the month in which his death or Disability occurred.  The Company shall pay Executive (or his beneficiary or estate in the event of his death) a lump-sum amount equal to the Target Bonus under the annual bonus plans maintained by the Company for the year of the Employment Period in which he died or became disabled.  The Company shall also pay Executive (or his beneficiary or estate in the event of his death) a lump-sum amount equal to his Target Bonus under the Company's Cash Incentive Plan for each separate performance period that has begun during the Employment Period to the extent that such Target Bonus has been set by the Committee or the Board.  Any options granted to Executive prior to February 10, 2004, shall be exercisable by Executive (or his estate in the event of his death) in accordance with the terms of such options.  Any grants of restricted stock granted to Executive prior to February 10, 2004, shall be handled in accordance with the terms of such grants.  Any Retention Stock Grants shall vest in the event of Executive's death or Disability.

 

Termination Without Cause.  If the Company terminates Executive’s employment during the Employment Period for some reason other than Cause, the Company shall pay Executive a lump-sum amount equal to Executive’s Base Salary for the remainder of the Employment Period, his Target Bonus under the Company's annual bonus plan for the year of the Employment Period in which Executive's employment is terminated, and his Target Bonus under the Company's Cash Incentive Plan for each separate performance period that has begun during the Employment Period to the extent that such Target Bonus has been set by the  Committee or the Board.  Any stock options granted prior to February 10, 2004, shall vest in accordance with the terms of such options and be exercisable for a period following the Termination Without Cause in accordance with the terms of such options.  Any restricted stock grants prior to February 10, 2004, shall be handled in accordance with their terms.  Any Retention Stock Grants shall vest on an accelerated basis on Executive's Date of Termination.  

 

Termination by Executive.  Executive can terminate his employment for any reason, provided that he gives the Board written notice at least 30 days’ prior to his Date of Termination.  If Executive terminates his employment for other than Good Reason, he shall only be paid his earned but unpaid Base Salary and accrued vacation benefits (up to time of termination).

 

If Executive terminates his employment for Good Reason, the Company shall pay Executive a lump sum amount equal to his Base Salary for the remainder of the Employment Period, his Target Bonus under the Company's annual bonus plans for the year of the Employment Period in which Executive terminates his employment for Good Reason, and his Target Bonus under the Company's Cash Incentive Plan for each separate performance period that has begun during the Employment Period to the extent that such Target Bonus has been set by the Committee or Board.  Any stock options granted prior to February 10, 2004, shall vest in accordance with the terms of such options and be exercisable for the period of time specified in such options.  Any restricted stock grants to Executive prior to February 10, 2004, shall be handled in accordance with their terms.  Any Retention Stock Grants shall vest on an accelerated basis on Executive's Date of Termination.

 

ARTICLE 8

RESTRICTIVE COVENANTS

 

Non-Solicitation of Employees.  During the remainder of any Employment Period  following a Termination of Employment and during the one-year period immediately following a Termination of Employment for Cause or Termination by Executive for other than Good Reason, Executive shall not directly or indirectly employ or seek to employ any employees of the Company or its Subsidiaries and shall not entice or otherwise encourage any such employee to leave such employment.

 

Confidentiality.  During the Employment Period, Executive shall maintain the confidential nature of information concerning the Company’s financial results and business strategies and shall not disclose such information to any person whose interests are or may be adverse to the Company’s interests or any person that may use such information to obtain personal financial gain.  

 

After a Termination of Employment for any reason, Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any confidential information to anyone other than the Company and its designees.

 

Injunction.  Executive acknowledges that monetary damages will not be an adequate remedy for the Company in the event he breaches the provisions of this Article.  Consequently, Executive agrees that the Company is entitled to an injunction to prevent Executive from any breach of the provisions of this Article in addition to other rights that the Company may have.

 

ARTICLE 9

MISCELLANEOUS

 

Beneficiary.  If Executive dies prior to receiving all of the amounts payable to him in accordance with the terms of this Agreement, such amounts shall be paid to one or more beneficiaries designated by Executive in writing to the Company during his lifetime, or if no such beneficiary is designated, to Executive’s estate.  Such payments shall be made in a lump sum to the extent so payable and, to the extent not payable in a lump sum, in accordance with the terms of this Agreement.  Executive, without the consent of any prior beneficiary, may change his designation of beneficiary or beneficiaries at any time or from time to time by submitting to the Company a new designation in writing.

 

Assignment Successors.  The Company may not assign its rights and obligations under this Agreement without the prior written consent of Executive except to a successor of the Company’s business that expressly assumes the Company’s obligations in writing.  This Agreement shall be binding upon and inure to the benefit of Executive, his estate and Beneficiaries, the Company and the successors and permitted assigns of the Company.

 

Good Faith.  During the Employment Period, Executive shall notify the Chairman of the Board's Executive Committee if he is being seriously considered for a senior management position with another entity.

 

Nonalienation.  Benefits payable under this Agreement shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution of levy of any kind, either voluntary or involuntary, prior to actually being received by Executive or a beneficiary, as applicable, and any such attempt to dispose of any right to benefits payable hereunder shall be void.

 

Arbitration.  Any dispute under this Agreement shall be settled by arbitration in Salt Lake City, Utah, pursuant to the Commercial Rules then in effect of the American Arbitration Association.  The Company and its successors shall reimburse Executive for any legal expenses and arbitration expenses that he may reasonably incur in conjunction with any disputes concerning the interpreted or enforcement of the provisions contained in this Agreement.

 

Severability.  If one or more parts of this Agreement are declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity shall not invalidate any part of this Agreement not declared to be unlawful or invalid.  Any part so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such part to the fullest extent possible while remaining lawful and valid.

 

Amendment/Waiver.  This Agreement shall not be amended or modified except by written instrument executed by the Company and Executive.  A waiver of any term, covenant or condition contained in this Agreement shall not be deemed a waiver of any other term, covenant or condition, and any waiver of any default in any such term, covenant or condition shall not be deemed a waiver of any later default thereof.

 

Notices.  All notices hereunder shall be in writing and delivered by hand, by nationally-recognized delivery service that guarantees overnight delivery, or by first-class, registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

 

If to the Company, to

Questar Corporation

180 East 100 South

Salt Lake City, Utah 84111

Attention: Lead Director

 

with a copy to:

Questar’s General Counsel

180 East 100 South

Salt Lake City, Utah 84111

 

If to Executive, to:

Keith O. Rattie

2547 Lupine Drive

Park City, Utah 84060

 

Either party may from time to time designate a new address by notice given in accordance with this Section.  Notice shall be effective when actually received by the addressee.

 

Counterparts and Facsimile Signatures.  This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.  A facsimile signature may be accepted as an original signature.

 

Entire Agreement.  This Agreement forms the entire agreement between the parties with respect to the subject matter addressed in this Agreement.  It supersedes all prior agreements, promises and representations regarding employment, compensation, severance or other payments contingent upon termination of employment.

 

Applicable Law.  This Agreement shall be interpreted and construed in accordance with the laws of the state of Utah, without regard to its choice of law principles.

 

Survival of Executive’s Rights and Obligations.  All of Executive’s rights and obligations shall survive the termination of Executive’s employment and/or the termination of this Agreement.

 

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.

 

QUESTAR CORPORATION

 

 

 

By:  /s/ S E. Parks_____________________          

S. E. Parks

Sr. Vice President, Treasurer

and Chief Financial Officer

 

 

EXECUTIVE

 

 

 

Ex 99.1


Amendment to contract between Questar Corporation and Keith O. Rattie


Second Amendment to

Employment Agreement between

Questar Corporation and Keith O. Rattie


2





This Second Amendment to Employment Agreement is dated as of February 28, 2007, and is between Questar Corporation (Company) and Keith O. Rattie (Executive).


The parties represent as follows:


A.  Company and Executive are parties to that Employment Agreement dated February 1, 2004 (the 2004 Agreement) regarding Executive’s continued employment with Company.


B.  The parties desire to amend the 2004 Agreement to reflect that Executive is to acquire and retain shares of the Company’s common stock having a value equal to at least eight times his annual Base Salary.


For sufficient consideration, the parties agree that the Stock Ownership paragraph of Article 5 of the 2004 Agreement shall be amended by replacing the phrase “at least three times his annual Base Salary” in the second sentence to “at least eight times his annual Base Salary.”


Except as amended hereto, all other terms and conditions shall remain the same.


The parties have executed this Second Amendment to the 2004 Agreement on the date first above written.


KEITH O. RATTIE




By__________________________



QUESTAR CORPORATION




By__________________________





_____/s/ Keith O. Rattie       ____________

Keith O. Rattie

 

 

EX-99 2 str8k123108x991.htm EXHIBIT 99.1

Exhibit 99.1


THIRD AMENDMENT TO

EMPLOYMENT AGREEMENT BETWEEN

QUESTAR CORPORATION AND KEITH O. RATTIE


This Third Amendment to the Employment Agreement is dated as of December 31, 2008, and is between Questar Corporation (Company) and Keith O. Rattie (Executive).


The parties represent as follows:


A.  Company and Executive are parties to that Employment Agreement dated February 1, 2004 (the 2004 Agreement) regarding Executive’s continued employment with Company.


B.  The parties desire to amend the 2004 Agreement for the primary purpose of making necessary changes to comply with the provisions of Section 409A of the Internal Revenue Code of 1986, as amended, and to address certain recent changes to the application of Section 162(m) of the Code described in IRS Revenue Ruling 2008-13, and other minor modifications.


For sufficient consideration, the parties agree to the following amendments:


1.

Article 1, DEFINITIONS, is modified as follows:


a.

The definition of “Change in Control” is amended by replacing the language under subsection (a) with the following:


(a) any “person” (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Exchange Act’)) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company, is or becomes the beneficial owner (as such term is used in Rule 13d-3 under the Exchange Act) of securities of the Company representing 25 percent or more of the combined voting power of the Company;


b.

The definition of “Company” is amended by replacing the language in its entirety with the following:  “Company means Questar Corporation on a consolidated basis, or the ultimate parent corporation of the acquiring or surviving company in the case of an acquisition, merger, consolidation, etc. involving Questar Corporation.”


c.

The definition of “Disability” is amended by replacing the language in its entirety with the following:  


Disability means a condition that renders Executive unable to engage in any substantial, gainful activity by reason of any medically-determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve months.  The foregoing definition of “Disability” shall be interpreted in a manner consistent with Section 409A of the Code and the Internal Revenue Service and Treasury guidance thereunder.


d.

The definition of “Good Reason” is amended by replacing the language in its entirety with the following:


Good Reason with respect to the Executive’s termination of employment means any of the following events or conditions which occur without the Executive’s written consent and which remain in effect after notice has been provided by the Executive to the Company of such event or condition and the expiration of a 30 day cure period: (i) a material diminution in Executive’s base compensation; (ii) a material diminution in Executive’s authority, duties, or responsibility; (iii) a material change in the geographic location at which the Executive performs services; or (iv) any other action or inaction that constitutes a material breach by the Company or its Subsidiaries of this Agreement.  The Participant’s notification to the Company must be in writing and must occur within a


reasonable period of time, not to exceed 90 days, following the Participant’s discovery of the relevant event or condition.  Any reasonable determination by Executive that any of the specified events has occurred and constitutes Good Reason shall be conclusive and binding for all purposes.


e.

The definition of “Subsidiary” is amended by adding “or any partnership interest” after the phrase “owns at least 50 percent of the outstanding shares of capital stock. . .”


2.

Article 3, EMPLOYMENT PERIOD, is amended for clarification by replacing the language in its entirety with the following:


Employment Period.  Subject to earlier termination in accordance with Article 7, the term of Executive’s employment under this Agreement (the “Employment Period”) shall begin on the Agreement Date and end on the Anniversary Date that is three years after such Agreement Date; provided, however, that the Employment Period will be automatically extended by a period of one year on each Anniversary of this Agreement unless the Board provides notice to Executive at least 30 days prior to any such Anniversary Date or Executive provides notice to the Board at least 30 days prior to any such Anniversary Date that the Employment Period will not be so extended.  Once notice of non-renewal has been tendered by either party, no further automatic extensions of this Agreement shall occur.


3.

Article 6, OTHER BENEFITS, is amended as follows:


a.

The “Welfare Benefit Plans” and “Vacation” sections are amended to reflect the company’s current use of Paid Time Off (PTO) in place of approved personal leave or vacation.


b.

The reference to the Company’s “Deferred Share Make-up Plan, the Deferred Compensation Plan and the Deferred Share Plan” under the “Nonqualified Benefit Plans” section are replaced with the “Deferred Compensation Wrap Plan, and its component programs.”  


c.

The following sentence is added at the end of the “Expenses” section:  “The amount of expenses eligible for reimbursement in the Executive’s taxable year may not affect the expenses for reimbursement in any other taxable year.”


4.

Article 7, TERMINATION OF EMPLOYMENT, is amended as follows:


a.

All references to “vacation” is replaced with “PTO.”


b.

The “Termination Without Cause” section is amended by replacing the first sentence with the following:


If the Company terminates Executive’s employment during the Employment Period for some reason other than Cause, death or Disability, the Company shall pay Executive a lump-sum amount equal to (i) Executive’s Base Salary for the remainder of the Employment Period; (ii) the average of the annual cash bonuses Executive actually received under the Company’s annual bonus plan(s) for the last three full fiscal years immediately prior to the Date of Termination; and (iii) three times the average of the cash incentive payment Executive actually received under the Company’s Cash Incentive Plan for the last three full fiscal years immediately prior to the Date of Termination (or any lesser number of years that the Plan was in effect for which payments could be determined).   Amounts payable under this subsection will be paid in a cash lump sum, subject to applicable withholdings, within 30 days of the Date of Termination.


c.

The “Termination by Executive” section is amended by replacing the first sentence of the second paragraph with the following:


If executive terminates his employment for Good Reason, the Company shall pay Executive a lump-sum amount equal to (i) Executive’s Base Salary for the remainder of the Employment Period; (ii) the average of the annual


2



cash bonuses Executive actually received under the Company’s annual bonus plan(s) for the last three full fiscal years immediately prior to the Date of Termination; and (iii) three times the average of the cash incentive payment Executive actually received under the Company’s Cash Incentive Plan  for the last three full fiscal years immediately prior to the Date of Termination (or any lesser number of years that the Plan was in effect for which payments could be determined).   Amounts payable under this subsection will be paid in a cash lump sum, subject to applicable withholdings, within 30 days of the Date of Termination.


d.

A new section regarding Code Section 409A is added as follows:


409A Payment and Ordering Rules.  Payments under this Article 7 are intended to qualify to the maximum extent possible as “short-term deferrals” exempt from the application of Code Section 409A.  Any payments that do not so qualify are intended to qualify for the Code Section 409A exemption set forth in Treasury Regulation Section 1.409A-1(b)(9)(iii) (which exempts from Code Section 409A certain payments made upon an “involuntary separation from service”).  Any payments under this Article 7 that are not exempted from Code Section 409A and that are payable prior to the date that is six months and one day after the date of termination (the “Deferred Payment Date”) shall be withheld by the Company and paid to Executive on the Deferred Payment Date or as soon thereafter as is administratively feasible.  Nothing in this paragraph shall prohibit the Company and Executive from making use of any other Code Section 409A exemption that may be applicable to a payment or benefit hereunder.


5.

A new Article 9, SUCCESSOR TO COMPANY, is added which provides as follows:


This Agreement shall bind any successor to the Company, its assets or its businesses (whether direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under this Plan if no succession had taken place.


In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Agreement, the Company shall require such successor expressly and unconditionally to assume and agree to perform the Company’s obligations under this Agreement, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.  In the event that a successor fails to expressly and unconditionally assume and agree to perform the Company’s obligations under this Agreement, such failure shall be deemed to be a material breach of this Agreement.   


6.

Article 9, MISCELLANEOUS, renumbered as Article 10 is amended as follows:


a.

The “Beneficiary” section is amended by replacing “Executive’s estate” as the default beneficiary with “the beneficiary(ies) designated by the Executive (or deemed by law to be designated) under Questar Corporation’s Employee Investment Plan.”


b.

The “Assignment Successors” section is amended by replacing the first sentence with the following:  “Except as provided above in Article 9, the Company may not assign its rights and obligations under this Agreement without the prior written consent of Executive.”


c.

A new section is added which provides as follows:


409A Savings Clause.  The parties intend that payments or benefits payable under this Agreement not be subject to the additional tax imposed pursuant to Section 409A of the Code, and the provisions of this Agreement shall be construed and administered in accordance with such intent. To the extent such potential payments or benefits could become subject to Code Section 409A, the parties shall cooperate to amend this Agreement with the goal of giving Executive the economic benefits described herein in a manner that does not result in such tax being imposed.  If the parties are unable to agree on a mutually acceptable amendment, the Company may, without Executive’s consent and in such manner as it deems appropriate or desirable, amend or modify this Agreement or


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delay the payment of any amounts hereunder to the minimum extent necessary to meet the requirements of Code Section 409A.  


Except as amended hereto, all other terms and conditions shall remain the same.


The parties have executed this Third Amendment on the date first above written.


QUESTAR CORPORATION



By___________________________

S.E. Parks

Sr. Vice President and CFO


EXECUTIVE


______________________________

Keith O. Rattie


4

































Exhibit 10.23


First Amendment to

Employment Agreement between

Questar Corporation and Keith O. Rattie



This First Amendment to Employment Agreement is dated as of May 17, 2005, with an effective date of January 1, 2005 (the Effective Date), and is between Questar Corporation (Company) and Keith O. Rattie (Executive).


The parties represent as follows:


A.  Company and Executive are parties to that Employment Agreement dated February 1, 2004 (the 2004 Agreement) regarding Executive’s continued employment with Company.


B.  The parties desire to amend the 2004 Agreement to reflect that as of the Effective Date, Executive will participate in the Annual Management Incentive Plan II (“AMIP II”) as approved by the Company’s Board of Directors and shareholders.


The parties agree as follows:


As of the Effective Date, the second paragraph of Article 4 of the 2004 Agreement (Annual Bonus) shall be amended by replacing “the Annual Management Incentive Plan (‘AMIP’)” with “the Annual Management Incentive Plan II (‘AMIP II’).”


Except as amended hereto, all other terms and conditions shall remain the same.


The parties have executed this First Amendment to the 2004 Agreement on the date first above written.



QUESTAR CORPORATION



By

/s/S. E. Parks


S.E. Parks

Senior Vice President and Chief Financial

Officer


EXECUTIVE


By

/s/Keith O. Rattie


Keith O. Rattie


Exhibit 99.1





QUESTAR CORPORATION

EXECUTIVE SEVERANCE COMPENSATION PLAN


(Amended and Restated Effective October 23, 2007)








QUESTAR CORPORATION
EXECUTIVE SEVERANCE COMPENSATION PLAN

(Amended and Restated Effective October 23, 2007)


ARTICLE I
INTRODUCTION


The Board of Directors of Questar Corporation recognizes that, as is the case with many publicly held corporations, the possibility of a Change in Control exists.  This possibility, and the uncertainty it creates with executives, may be detrimental to the Company and its shareholders if executives are distracted and/or leave the Company.


The Board considers the avoidance of such loss and distraction to be essential to protecting and enhancing the best interests of the Company and its shareholders.  The Board also believes that when a Change in Control is perceived as imminent, or is occurring, the Board should be able to receive and rely on disinterested service from executive employees regarding the best interests of the Company and its shareholders without concern that the executive employees might be distracted or concerned by their personal uncertainties and risks created by the perception of an imminent or occurring Change in Control.


In addition, the Board believes that it is consistent with the Company’s employment practices and policies and in the best interests of the Company and its shareholders to treat fairly its executive employees whose employment terminates in connection with or following a Change in Control.


Accordingly, the Board has determined that appropriate steps should be taken to assure the Company and its Affiliates of the executive employees’ continued employment and attention and dedication to duty, and to seek to ensure the availability of their continued service, notwithstanding the possibility, threat or occurrence of a Change in Control.


In order to fulfill the above purposes, the Board hereby amends and restates the Questar Corporation Executive Severance Plan (the “Plan”) effective as of the Effective Date, as set forth below.


ARTICLE II

ESTABLISHMENT OF PLAN


As of the Effective Date, the Company hereby amends and restates its separation compensation plan known as the Questar Corporation Executive Severance Compensation Plan, as set forth in this document.


ARTICLE III

DEFINITIONS


As used herein, the following words and phrases shall have the following respective meanings unless the context clearly indicates otherwise.


(a)

Affiliate.  Any entity which controls, is controlled by or is under common control with the Company.

(b)

Annual Cash Incentive Plans.  The Company’s Annual Management Incentive Plan and Annual Management Incentive Plan II, and any successor or replacement annual cash incentive plans or arrangements.

(c)

Annual Base Salary.  The Participant’s gross annual base salary in effect immediately prior to the Change in Control.

(d)

Average Annual Bonus Amount.  The higher of:  (i) the average of the annual bonuses a Participant actually received under the Company’s Annual Cash Incentive Plans for the Look-Back Period; or (ii) the


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average annual target bonuses established for the Participant under the Company’s Annual Cash Incentive Plans for the Look-Back Period.  In the event a Participant’s Date of Termination occurs prior to payment of the annual bonus under the Annual Cash Incentive Plans for the most recently completed fiscal year, the amount actually received for such year for purposes of (i) above shall be deemed to be the target bonus amount established for the Participant under the Annual Cash Incentive Plans for such year.


(e)

Board.  The Board of Directors of the Company.


(f)

Cause.  Cause shall mean:  (i) the willful and continued failure of the Participant to perform substantially the Participant’s duties with the Company or one of its Affiliates (other than any such failure resulting from incapacity due to physical or mental illness), following written demand for substantial performance delivered to the Participant by the Board or the Chief Executive Officer of the Company; or (ii) the willful engaging by the Participant in conduct which is materially injurious to the Company or any Affiliate.  For purposes of this definition, no act or failure to act on the part of the Participant shall be considered “willful” unless it is done, or omitted to be done, by the Participant without reasonable belief that the Participant’s action or omission was in the best interests of the Company or any Affiliate.  The Company, acting through its Board of Directors, must notify the Participant in writing that the Participant’s employment is being terminated for “Cause”.  The notice shall include a list of the factual findings used to sustain the judgment that the Participant’s employment has been terminated for “Cause”.


(g)

Change in Control.  A Change in Control shall be deemed to have occurred if:  (i) any “person” (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Exchange Act’)) other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company, is or becomes the beneficial owner (as such term is used in Rule 13d-3 under the Exchange Act) of securities of the Company representing 25 percent or more of the combined voting power of the Company; or (ii) the following individuals cease for any reason to constitute a majority of the number of directors then serving:  individuals who, as of May 19, 1998, constitute the Company’s Board of Directors and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s stockholders was approved or recommended by a vote of at least two-thirds of the directors then still in office who either were directors on May 19, 1998, or whose appointment, election or nomination for election was previously so approved or recommended; or (iii) the Company’s stockholders approve a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 60 percent of the combined voting power of the securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation, or a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no person is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing 25 percent or more of the combined voting power of the Company’s then outstanding securities; or (iv) the Company’s stockholders approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 60 percent of the combined voting power of the voting securities of which are owned by the stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.  A Change in Control, however, shall not be considered to have occurred until all conditions precedent to the transaction, including but not limited to, all required regulatory approvals have been obtained.


(h)

Code.  The Internal Revenue Code of 1986, as amended from time to time.


(i)

Company.  Questar Corporation and any successor to such entity.


(j)

Compensation.  The Participant’s remuneration taken into account under the Retirement Plan for purposes of calculating benefits under such plan.  With regard to benefit calculations under the SERP, Compensation shall have the meaning set forth in the previous sentence, but shall be modified to include all amounts in excess of the compensation limit established by Section 401(a)(17) of the Code and all amounts deferred under the terms of the Company’s non-qualified deferred compensation plans.


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(k)

Date of Termination.  The date on which a Participant ceases to be an Employee of the Company and its Affiliates as a result of a “separation from service” as determined in accordance with the default provisions of Section 409A of the Code and the Internal Revenue Service and Treasury guidance thereunder.


(l)

Disability.  A condition that renders a Participant unable to engage in any substantial, gainful activity by reason of any medically-determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve months.  The foregoing definition of “Disability” shall be interpreted in a manner consistent with Section 409A of the Code and the Internal Revenue Service and Treasury guidance thereunder.


(m)

Effective Date.  October 23, 2007.


(n)

Eligible Employee.  Any executive officer of any Employer.


(o)

Employer.  The Company or any Affiliate which participates in the Plan pursuant to Article IX hereof.


(p)

ERISA.  The Employee Retirement Income Security Act of 1974, as amended from time to time.


(q)

Good Reason.  Good Reason, with respect to a Participant’s termination of employment, means any of the following events or conditions which occur without the Participant’s written consent, and which remain in effect after notice has been provided by the Participant to the Company of such material reduction and the expiration of a 30 day cure period: (i) a material diminution in the Participant’s base compensation; (ii) a material diminution in the Participant’s authority, duties, or responsibility; (iii) a material diminution in the authority, duties, or responsibilities of the supervisor to whom the Participant is required to report, including a requirement that a Participant report to a corporate officer or employee instead of reporting directly to the Board; (iv) a material diminution in the budget over which the Participant retains authority; (v) a material change in the geographic location at which the Participant performs services; or (vi) any other action or inaction that constitutes a material breach by the Company or its Affiliates of the Participant’s employment agreement (if any).  The Participant’s notification to the Company must be in writing and must occur within a reasonable period of time, not to exceed 90 days, following the Participant’s discovery of the relevant event or condition.


(r)

Long-Term Cash Incentive Plan.  The Company’s Long-Term Cash Incentive Plan, or any successor or replacement multi-year cash incentive plan(s) or arrangement(s).


(s)

Look-Back Period.  The last three full fiscal years immediately prior to the Change in Control, or such shorter number of full fiscal years that the Participant was actually employed by an Employer.


(t)

Participant.  An individual who is designated as such pursuant to Section 4.1.


(u)

Plan.  The Questar Corporation Executive Severance Compensation Plan, as set forth in this document.


(v)

Plan Administrator.  The Management Performance Committee of the Board.


(w)

Retirement Plan.  The Questar Corporation Retirement Plan, as amended or restated from time to time, or any successor plan.


(x)

Separation Benefits.  The benefits described in Article VI that are provided to qualifying Participants under the Plan.


(y)

SERP.  The Questar Corporation Supplemental Executive Retirement Plan, as amended or restated from time to time, or any successor plan.



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(z)

Target Long Term Bonus Amount.  The single target bonus established for the Participant under the Company’s Long Term Cash Incentive Plan for the performance period beginning in the year in which the Date of Termination occurs.   In the event the Participant’s Date of Termination occurs prior to the establishment of the Participant’s target bonus for the performance period beginning in the year in which the Date of Termination occurs, the Target Long Term Bonus Amount shall be the single target bonus established for the Participant under the Company’s Long Term Cash Incentive Plan for the performance period beginning in the year immediately preceding the year in which the Date of Termination occurs.


ARTICLE IV

ELIGIBILITY


4.1

Participation.  The Board shall select from the group of Eligible Employees those individuals who may participate in the Plan.  Any Eligible Employee selected for participation shall become a Participant upon completion of such forms or other documents evidencing his or her consent to the provisions of this Plan as the Board may reasonably request.


4.2

Duration of Participation


(a)

Prior to the occurrence of a Change in Control, a Participant shall continue to participate in the Plan at the sole discretion of the Board, which may terminate the individual’s participation in the Plan at any time, and for any reason.  A Participant shall automatically cease participation in the Plan when he ceases to be an Eligible Employee of any Employer prior to a Change in Control.


(b)

On and after a Change in Control, a Participant shall cease to be a Participant in the Plan if he ceases to be an Eligible Employee of any Employer and is not entitled to payment of a Separation Benefit or any other benefits under the Plan (such as the special tax payment).  A Participant entitled to payment of a Separation Benefit or any other amounts under the Plan shall remain a Participant in the Plan until the full amount of the Separation Benefit and any other amounts payable under the Plan have been paid.


ARTICLE V

ENTITLEMENT TO BENEFITS


5.1

Terminations of Employment Which Give Rise to Separation Benefits Under This Plan.  A Participant shall be entitled to Separation Benefits as set forth in Article VI below if, at any time following a Change in Control and prior to the third anniversary of the Change in Control, the Participant has a “separation from service” (as determined in accordance with Section 409A of the Code and the Internal Revenue Service and Treasury guidance thereunder) that is (a) initiated by the Participant’s Employer for any reason other than Cause, death, or Disability, or (b) initiated by the Participant for Good Reason within 60 days following the expiration of the cure period afforded the Company to rectify the condition giving rise to Good Reason.


5.2

Eligibility for Equity Incentive Benefits and Special Tax Payments.  All Participants at the time of a Change in Control shall be eligible to receive the equity incentive benefits provided in Article VII and the special tax payments set forth in Article VIII.


ARTICLE VI

SEPARATION BENEFITS


6.1

Separation Benefits; General.  If a Participant’s employment is terminated in circumstances entitling the participant to Separation Benefits pursuant to Section 5.1, the Company shall provide to such Participant the cash payment set forth in Section 6.2 below, the pro-rata bonuses set forth in Section 6.3 below, the enhanced retirement benefits set forth in Section 6.4 below, the continued welfare benefits as set forth in Section 6.5 below, and the stock option and stock appreciation right benefits set forth in Section 6.6 below.


6.2

Cash Severance.  Participants shall be eligible for cash severance equal to the aggregate of the following amounts:


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(a)

an amount equal to two (2) times the Participant’s Annual Base Salary; and


(b)

an amount equal to two (2) times the Participant’s Average Annual Bonus Amount; and


(c)

an amount equal to two (2) times the Participant’s Target Long-Term Bonus Amount.


All cash payments required by this Section 6.2 shall be paid within 10 calendar days of the Participant’s Date of Termination; subject, however, to any payment delay required by Section 6.8(b).


6.3

Pro-Rata Bonus Amounts.  Participants shall be eligible for a cash payment equal to the aggregate of the following pro-rata bonus amounts:


(a)

a bonus equal to the product of (i) the bonus the Participant would have received under the Annual Cash Incentive Plans for the year in which the Date of Termination occurs, multiplied by (ii) a fraction, the numerator of which is the number of months (rounded up to whole months) the Participant was employed during the year in which the Date of Termination occurs, and the denominator of which is 12.   In the event the Date of Termination occurs prior to the establishment of a bonus amount under the Annual Cash Incentive Plans for the year in which the Date of Termination occurs, then, solely for purposes of this Section 6.3(i), the Date of Termination shall be deemed to be December 31st of the immediately preceding year.


(b)

for each of the performance periods outstanding under the Long Term Cash Incentive Plan as of the Date of Termination, a bonus equal to the product of (i) the greater of (A) the target bonus established for the Participant under the Long Term Incentive Plan for such performance period, or (B) the actual bonus that would have been earned by the Participant under the Long Term Incentive Plan for such performance period, multiplied by (ii) a fraction, the numerator of which is the number of months the Participant was employed during the performance period (rounded up to whole months), and the denominator of which is the total number of months in the performance period.   Solely for purposes of determining which performance periods are taken into account for purposes of the preceding sentence, (i) a performance period shall be deemed to be outstanding if payment has yet to occur for such period as of the Date of Termination, even if the actual performance period (i.e. the period over which performance is measured) has already ended, and (ii) a performance period shall not be deemed to be outstanding if a target bonus has yet to be established for such period as of the Date of Termination.


All cash payments required by this Section 6.3 shall be paid within 60 days of the end of the year in which the Date of Termination occurs; subject, however, to any payment delay required by Section 6.8(b).


6.4

Enhanced Retirement Benefits.  Participants shall be entitled to an enhanced retirement benefit generally based on the additional amount the Participant would receive under the Retirement Plan and the SERP (if participating) if the Participant were credited with an additional two years of service under each plan as of the Date of Termination.  Specifically:


(a)

Vested Participants.  Participants who have a vested benefit under the Retirement Plan as of the Date of Termination shall be entitled to an enhanced retirement benefit under this Plan equal to the excess of (i) the benefit accrued under the Retirement Plan and the SERP (if participating) as of the Date of Termination calculated as if (A) the Participant had been credited with two additional years of benefit service under the Retirement Plan (and correspondingly the SERP, if applicable) as of the Date of Termination and (B) the Participant’s compensation for such additional years of benefit service equaled the Participant’s Compensation for the last full fiscal year prior to the Date of Termination, over (ii) the actual benefits accrued under the Retirement Plan and the SERP (if participating) as of the Date of Termination.


(b)

Non-Vested Participants; Participants Ineligible to Participate in Retirement Plan.  Participants who are eligible to participate in the Retirement Plan but do not have a vested benefit under the Retirement Plan as of the Date of Termination shall be entitled to an enhanced retirement benefit under this Plan equal to what would be the Participant’s accrued vested benefit (if any) under the Retirement Plan and the SERP (if participating) as of the Date of Termination if (i) the Participant had been credited with two additional years of vesting and benefit service under the


5





Retirement Plan (and correspondingly the SERP) as of the Date of Termination, and (ii) the Participant’s compensation for such additional years of service were equal to the Participant’s Compensation for the last full fiscal year prior to the Date of Termination.  For avoidance of doubt, in no event shall a Participant be entitled to benefits under this Section 6.4 if the Participant was ineligible to participate in the Retirement Plan because the Participant’s Employer had not adopted the Retirement Plan for the benefit of its employees.


(c)

Payment of Enhanced Retirement Benefits.  All enhanced retirement benefits shall be paid in a single lump sum within 30 calendar days of the Participant’s Date of Termination; subject, however, to any payment delay required by Section 6.8(b).  The lump sum payment shall be equal to (i) the present value of the enhanced retirement benefit on the Date of Termination, calculated using a standard mortality table referred to as the 1983 Group Annuity Mortality table and an interest rate equal to 80% of the average of the IRS 30-year Treasury Securities Rates for the six-month period preceding the participant’s retirement, plus (ii) interest on such amount, credited monthly from the Date of Termination through the date of payment (taking into account any delay required by Section 6.8(b)), using the appropriate 30-year Treasury bond quoted in the Wall Street Journal on the first business day of each month.  The appropriate 30-year Treasury bond shall be the bond that has the closest maturity date (by month) preceding the month on which interest is to be credited.


6.5

Continued Welfare Benefits.  For six (6) months following the Participant’s Date of Termination, the Participant and his or her family shall be provided without cost medical, dental, disability, accidental death and dismemberment, and life insurance benefits that are the same as, or substantially similar to, the benefits that would have been received during such period had the Participant’s employment not been terminated.  It is the Company’s intent that such benefits shall be exempt from Code Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(9)(v) or pursuant to the application of Section 6.8(a), below.  In the event that the benefits provided pursuant to this Section 6.5 are deferred compensation subject to Code Section 409A, the benefits shall be provided in a manner that complies with Code Section 409A and may, if necessary, be provided through the reimbursement of premiums incurred for similar coverage procured by the Participant.  Any such reimbursement shall be made as soon as administrative practicable after the premiums have been incurred (subject, however, to any delay required by Section 6.8(b)) and shall be accompanied by any additional amounts necessary to offset the taxable nature (if any) of such benefit.  Some or all of the benefits required by this Section may be provided through the payment of COBRA premiums or through the Company’s retiree health insurance program.


6.6

Stock Option and Stock Appreciation Right Benefits.  Notwithstanding any shorter period to the contrary in any agreement between a Participant and the Company evidencing a grant of stock options or stock appreciation rights, the Participant shall have a minimum of sixty (60) days following the Date of Termination in which to exercise any vested stock options and stock appreciation outstanding as of the Change in Control.  Nothing in this Section 6.6, however, shall require the Company to continue in effect any stock option or stock appreciation right following a Change in Control, if, pursuant to the terms of the Change in Control, the Participant will receive automatically (on or within a reasonable time following the Change in Control), in cash or marketable securities, the intrinsic value of such awards as of the date of the Change in Control.


6.7

Other Benefits Payable.  To the extent not theretofore paid or provided, the Company shall timely pay or provide (or cause to be paid or provided) to a Participant entitled to Separation Benefits, any other amounts or benefits required to be paid or provided to the Participant or which the Participant is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its Affiliates.  Thus, by way of example and not by way of limitation, benefits earned under the Company’s Deferred Compensation Wrap Plan or SERP shall be unaffected by a Participant’s receipt of benefits hereunder, and shall continue to be payable solely in accordance with the relevant terms of those plans.  Notwithstanding the foregoing, if a Participant is entitled to Separation Benefits under this Plan and is also entitled to severance benefits under any employment agreement or other severance pay plan or policy of the Company, benefits from this Plan will be offset by the amount of the severance benefits or similar amounts received under or payable in accordance with such other agreements, plans, or policies.  In addition, Separation Benefits under this Plan shall also be reduced by any amounts that are paid under the Annual Cash Incentive Plans or Long Term Cash Incentive Plan which are contingent on the Participant’s termination of employment following a Change in Control.


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6.8

Code Section 409A; Specified Employees.


(a)

It is the intent of the Company that the Separation Benefits provided in this Article VI qualify as “short-term deferrals” exempt from the application of Code Section 409A.  If it is determined by the Plan Administrator that some or all of the Separation Benefits are not so exempt, then it is the intent of the Company that such Separation Benefits qualify to the maximum extent possible for the Code Section 409A exemption set forth in Treasury Regulation Section 1.409A-1(b)(9)(iii).  To the extent that the Separation Benefits which would otherwise be deferred compensation subject to Code Section 409A exceed the threshold set forth in that regulation, the Plan Administrator will apply the exemption first to the continued welfare benefits set forth in Section 6.5 (to the extent such benefits are deferred compensation subject to Code Section 409A) and thereafter to the Separation Benefits that are payable closest in time to the Date of Termination (determined prior to the application of Section 6.8(b), below), until the exemption has been applied in full.  Any remaining Separation Benefits shall be subject to the provisions of the Plan with regard to Code Section 409A, including the possible delay required by Section 6.8(b), below.


(b)

In the event that the Plan Administrator determines that all or any portion of any Separation Benefits provided under this Article VI are deferred compensation subject to Code Section 409A, then, with respect to any Participant who is a “specified employee” (as defined in Section 409A(2)(B)(i)), all of the Separation Benefits that are deferred compensation subject to Code Section 409A and that would otherwise be payable prior to the date that is six (6) months after the Date of Termination (the “Specified Employee Distribution Date”) shall be withheld by the Company and paid on the Specified Employee Distribution Date or as soon thereafter as is administratively feasible.


ARTICLE VII
EQUITY INCENTIVE BENEFITS


All of a Participant’s stock options, stock appreciation rights, restricted stock awards, and other equity incentive awards shall vest in full immediately prior to a Change in Control.


ARTICLE VIII

SPECIAL TAX PAYMENTS


8.1

Right to Excise Tax Gross-Up.  Except as set forth below, in the event it shall be determined that any payment or distribution by the Company or its affiliates to or for the benefit of a Participant (whether paid or payable or distributed or distributable pursuant to the terms of this Plan or otherwise, but determined without regard to any additional payments required under this Article VIII) (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 Participant 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 Participant shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Participant 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 Participant retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.


8.2

Determination of Amount; Payment.  Subject to the provisions of Section 8.3, all determinations required to be made under this Article VIII, including whether 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 a nationally recognized certified public accounting firm designated by the Company (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Company and the Participant within 15 business days of the receipt of notice from the Participant 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 Company 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 Accounting Firm shall be borne solely by the Company.  Any Gross-Up Payment, as determined pursuant to this Article VIII, shall be paid by the Company to the Participant promptly upon receipt of the Accounting Firm’s determination, but in no event later than the end of Participant’s taxable year next following the taxable year in which the


7





original excise tax on the Payments is remitted to the Internal Revenue Service.  Any determination by the Accounting Firm shall be binding upon the Company and the Participant.  As a result of the possible uncertainty of the Participant’s employment status as of the date of payment and 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 be (or should have been) made (“Underpayment”), consistent with the calculations required to be made hereunder.  In such case, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be paid promptly by the Company to or for the benefit of the Participant but in no event shall such payment be made later than the end of Participant’s tax year following the tax year in which the Excise Tax is remitted to the Internal Revenue Service.


8.3

IRS Dispute Procedures.  The Participant 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 Participant 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 Participant 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 Participant in writing prior to the expiration of such period that it desires to contest such claim, the Participant shall:


(a)

give the Company any information reasonably requested by the Company relating to such claim;


(b)

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;


(c)

cooperate with the Company in good faith in order to effectively contest such claim; and


(d)

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 Participant 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 on the foregoing provisions of this Section 8.3, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 Participant to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Participant 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 Participant to pay such claim and sue for a refund, the Company shall advance the amount of such payment to the Participant, on an interest-free basis and shall indemnify and hold the Participant 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 Participant 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 Participant 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.


8.4

Adjustments.  If, after the receipt by the Participant of an amount advanced by the Company pursuant to Section 8.3, the Participant becomes entitled to receive any refund with respect to such claim, the Participant shall (subject to the Company’s complying with the requirements of Section 8.3) 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 Participant of an amount advanced by the Company pursuant to Section 8.3, a determination is made that the Participant shall not be entitled to any refund with respect to such claim and the Company does not notify the Participant in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such


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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.


8.5

Withholding.  All payments to the Participant in accordance with the provisions of this Plan shall be subject to applicable withholding of local, state, Federal and foreign taxes, as determined in the sole discretion of the Company.


ARTICLE IX
PARTICIPATING EMPLOYERS


Any Affiliate of the Company may become a participating Employer in the Plan following approval by the Company.  The provisions of the Plan shall be fully applicable to the Employees of any such Affiliate who are Participants pursuant to Section 4.1.

ARTICLE X
SUCCESSOR TO COMPANY


This Plan shall bind any successor of the Company, its assets or its businesses (whether direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under this Plan if no succession had taken place.


In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Plan, the Company shall require such successor expressly and unconditionally to assume and agree to perform the Company’s obligations under this Plan, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.  In the event of a Change in Control in which the successor fails to expressly and unconditionally assume and agree to perform the Company’s obligations under this Plan, each Participant in the Plan immediately prior to the Change in Control shall be deemed to have separated from service in accordance with Section 5.1 and shall be entitled to the benefits provided hereunder as if the day prior to the date of the Change in Control were the Participant’s Date of Termination.  It is the intent of the Company that, in such event, the benefits provided pursuant to this Section would qualify as “short-term deferrals” exempt from the application of Code Section 409A.  


The term “Company,” as used in this Plan, shall mean the Company as hereinbefore defined and any successor or assignee to the business or assets which by reason hereof becomes bound by this Plan.


ARTICLE XI

DURATION, AMENDMENT AND TERMINATION


11.1

Duration.  If a Change in Control has not occurred, this Plan shall continue indefinitely unless and until terminated by the Board pursuant to Section 11.2, below.  If a Change in Control occurs while this Plan is in effect, the Plan shall continue in full force and effect for three years following such Change in Control, and shall then automatically terminate; provided, however, that all Participants who become entitled to any payments hereunder shall continue to receive such payments notwithstanding any termination of the Plan.


11.2

Amendment or Termination.  The Board may amend or terminate this Plan for any reason prior to a Change in Control.  In the event of a Change in Control, this Plan shall automatically terminate as set forth in Section 11.1 but may not be amended or prematurely terminated.


11.3

Procedure for Extension, Amendment or Termination.  Any amendment or termination of this Plan by the Board in accordance with the foregoing shall be made by action of the Board in accordance with the Company’s charter and by-laws and applicable law.


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ARTICLE XII
MISCELLANEOUS


12.1

Full Settlement.  Except as otherwise provided in Section 6.6, the Company’s obligation to make the payments provided for under this Plan and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against a Participant or others.  In no event shall a Participant be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Participant under any of the provisions of this Plan and such amounts shall not be reduced whether or not the Participant obtains other employment.  


12.2

Employment Status.  This Plan does not constitute a contract of employment or impose on the Participant or the Participant’s Employer any obligation for the Participant to remain an Employee or change the status of the Participant’s employment or the policies of the Company and its Affiliates regarding termination of employment.


12.3

Confidential Information.  Each Participant shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or any of its Affiliates, and their respective businesses, which shall have been obtained by the Participant during the Participant’s employment by the Company or any of its Affiliates and which shall not be or become public knowledge (other than by acts by the Participant or representatives of the Participant in violation of this Plan).  After termination of a Participant’s employment with the Company or other Employer, the Participant shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those designated by it.  In no event shall an asserted violation of the provisions of this Section 12.3 constitute a basis for deferring or withholding any amounts otherwise payable under this Plan.


12.4

Named Fiduciary; Administration. The Company is the named fiduciary of the Plan, and shall administer the Plan, acting through the Company’s Management Performance Committee, who shall be the Plan Administrator.  The Plan Administrator shall have full and complete discretionary authority to administer, construe, and interpret the Plan, to decide all questions of eligibility, to determine the amount, manner and time of payment, and to make all other determinations deemed necessary or advisable for the Plan.  The Plan Administrator shall review and determine all claims for benefits under this Plan.


12.5

Claim Procedure.  


(a)

Filing a Claim.  All claims and inquiries concerning benefits under the Plan must be submitted to the Plan Administrator in writing.  The claimant may submit written comments, documents, records or any other information relating to the claim.  Furthermore, the claimant shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claim for benefits.  If an Employee or former Employee makes a written request alleging a right to receive benefits under this Plan or alleging a right to receive an adjustment in benefits being paid under the Plan, the Company shall treat it as a claim for benefits.


(b)

Review of Claims; Claims Denial.  The Plan Administrator shall initially deny or approve all claims for benefits under the Plan.  If any claim for benefits is denied in whole or in part, the Plan Administrator shall notify the claimant in writing of such denial and shall advise the claimant of his right to a review thereof.  Such written notice shall set forth, in a manner calculated to be understood by the claimant, specific reasons for such denial, specific references to the Plan provisions on which such denial is based, a description of any information or material necessary for the claimant to perfect his claim, an explanation of why such material is necessary and an explanation of the Plan’s review procedure, and the time limits applicable to such procedures.  Furthermore, the notification shall include a statement of the claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review.  Such written notice shall be given to the claimant within a reasonable period of time, which normally shall not exceed ninety (90) days, after the claim is received by the Plan Administrator.


(c)

Appeals.  Any claimant or his duly authorized representative, whose claim for benefits is denied in whole or in part, may appeal such denial by submitting to the Plan Administrator a request for a review of the claim within sixty (60) days after receiving written notice of such denial from the Plan Administrator.  The Plan Administrator


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shall give the claimant upon request, and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claim of the claimant, in preparing his request for review.  The request for review must be in writing.  The request for review shall set forth all of the grounds upon which it is based, all facts in support thereof, and any other matters which the claimant deems pertinent.  The Plan Administrator may require the claimant to submit such additional facts, documents, or other materials as the Plan Administrator may deem necessary or appropriate in making its review.


(d)

Review of Appeals.  The Plan Administrator shall act upon each request for review within sixty (60) days after receipt thereof.  The review on appeal shall consider all comments, documents, records and other information submitted by the claimant relating to the claim without regard to whether this information was submitted or considered in the initial benefit determination.


(e)

Decision on Appeals.  The Plan Administrator shall give written notice of its decision to the claimant.   If the Plan Administrator confirms the denial of the application for benefits in whole or in part, such notice shall set forth, in a manner calculated to be understood by the claimant, the specific reasons for such denial, and specific references to the Plan provisions on which the decision is based.  The notice shall also contain a statement that the claimant is entitled to receive upon request, and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claimant’s claim for benefits.  Information is relevant to a claim if it was relied upon in making the benefit determination or was submitted, considered or generated in the course of making the benefit determination, whether it was relied upon or not.  The notice shall also contain a statement of the claimant’s right to bring an action under ERISA Section 502(a).  If the Plan Administrator has not rendered a decision on a request for review within sixty (60) days after receipt of the request for review, the claimant’s claim shall be deemed to have been approved.  The Plan Administrator’s decision shall be final and not subject to further review within the Company.  There are no voluntary appeals procedures after appellate review by the Plan Administrator.


(f)

Determination of Time Periods.  If the day on which any of the foregoing time periods is to end is a Saturday, Sunday or holiday recognized by the Company, the period shall extend until the next following business day.


12.6

Unfunded Plan Status.  All payments pursuant to the Plan shall be made from the general funds of the Company and no special or separate fund shall be established or other segregation of assets made to assure payment.  No Participant or other person shall have under any circumstances any interest in any particular property or assets of the Company as a result of participating in the Plan.  Notwithstanding the foregoing, the Company may (but shall not be obligated to) create one or more grantor trusts, the assets of which are subject to the claims of the Company’s creditors, to assist it in accumulating funds to pay its obligations under the Plan.


12.7

Attorney Fees; Interest.  The Company agrees to pay as incurred, to the full extent permitted by law, and in accordance with Section 409A, all legal fees and expenses which a Participant may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Participant, or others of the validity or enforceability of, or liability under, any provision of this Plan or any guarantee of performance thereof (including as a result of any contest by the Participant about the amount of any payment pursuant to this Plan), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(A) of the Code.  The foregoing right to legal fees and expenses shall not apply to any contest brought by a Participant (or other party seeking payment under the Plan) that is found by a court of competent jurisdiction to be frivolous or vexatious.


12.8

Code Section 409A Savings Clause.  It is the intent of the Company that all payments and benefits under this Plan be made in accordance with Code Section 409A or an exception thereto.  To the extent that any payment or benefit would violate Code Section 409A the Committee shall delay or restructure such payment or benefit to the minimum extent necessary to avoid the application of Code Section 409A.


12.9

Validity and Severability.  The invalidity or unenforceability of any provision of the Plan shall not affect the validity or enforceability of any other provision of the Plan, which shall remain in full force and effect, and any prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.



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12.10

Governing Law.  The validity, interpretation, construction and performance of the Plan shall in all respects be governed by the laws of Utah, without reference to principles of conflict of law, except to the extent pre-empted by Federal law.


This amendment and restatement of the Questar Corporation Executive Severance Compensation Plan has been adopted this 24th day of October, 2007, to be effective as of the Effective Date set forth herein.


QUESTAR CORPORATION




By:_______________________________________