Exhibit 10.8

PETROQUEST ENERGY, INC.

STOCK OPTION AWARD AGREEMENT

THIS STOCK OPTION AWARD AGREEMENT (this “Agreement”) is made and entered into by
and between PetroQuest Energy, Inc., a corporation organized under the laws of
the State of Delaware (the “Company”), and [__________] (“Participant”), an
individual, on the 8th day of February, 2019 (the “Grant Date”), pursuant to the
PetroQuest Energy, Inc. 2019 Long Term Incentive Plan (the “Plan”). The Plan is
incorporated by reference herein in its entirety.

1. Grant of Stock Option. As of the Grant Date, the Company, hereby grants a
Stock Option (the “Option”) to the Participant, to purchase [__________] shares
of Stock (“Shares”), subject to the terms and conditions of this Agreement and
the Plan. The Shares, when issued to Participant upon the exercise of the
Option, shall be fully paid and nonassessable. The Option is an “incentive stock
option” as defined in Section 422 of the Internal Revenue Code. The
Participant’s execution of this Agreement shall be Participant’s agreement to be
bound by the terms of this Agreement and Plan with respect to the Option.

2. Definitions. All capitalized terms used herein shall have the meanings set
forth in the Plan unless otherwise specifically provided herein.

3. Option Term. The Option shall commence on the Grant Date and terminate on the
date immediately prior to the seventh (7th) anniversary of the Grant Date. The
period during which the Option is in effect and may be exercised is referred to
herein as the “Option Period.”

4. Option Price. The exercise price per share (the “Option Price”) shall be (i)
$10.00 with respect to 50% of the Shares subject to the Option and (ii) $12.50
with respect to the remaining 50% of the Shares subject to the Option, each of
which equals or exceed the Fair Market Value of a Shares on the Grant Date.

5. Vesting. Subject to Section 9, the Options will vest and become exercisable
upon the earlier to occur of (i) attainment of a 20-trading day volume-weighted
average price of a Share at least equal to the applicable Option Price following
the Grant Date or (ii) a “Change in Control” (as defined in the Participant’s
termination agreement between the Participant and the Company, and if there is
no such termination agreement, as provided in the employment agreement between
the Participant and the Company, and if neither applies, then as defined in the
Plan). The right of exercise provided herein shall be cumulative so that if the
Option is not exercised to the maximum extent permissible after vesting, the
vested portion of the Option shall be exercisable, in whole or in part, at any
time during the Option Period.

6. Method of Exercise. The Option is exercisable by delivery of a written notice
to the attention of the Secretary of the Company at 400 E. Kaliste Saloom Road,
Suite 6000, Lafayette, Louisiana 70508, signed by the Participant, specifying
the Option being exercised by reference to the Option Price, the number of
Shares to be acquired on, and the effective date of, such exercise. The
Participant may withdraw notice of exercise of this Option, in writing, at any
time prior to the close of business on the business day preceding the proposed
exercise day.

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7. Method of Payment. The Option Price upon exercise of the Option shall be
payable to the Company in full: (i) in cash or its equivalent, or (ii) by
withholding Shares which otherwise would be acquired on exercise having an
aggregate Fair Market Value at the time of exercise equal to the total Option
Price, or (iii) by a combination of (i) and (ii) above as elected by the
Participant and specified in the written notice of exercise. Any payment in
shares of Stock owned by Participant shall be effected by the delivery of such
shares to the Secretary of the Company, duly endorsed in blank or accompanied by
stock powers duly executed in blank, together with any other documents as the
Secretary may require. If the payment of the Option Price is remitted partly in
Shares, the balance of the payment of the Option Price shall be paid in either
cash, certified check, bank cashiers’ check, or by wire transfer. The Committee
may allow any other means of exercise which the Committee, in its discretion,
determines to be consistent with the Plan’s purpose and applicable law. As soon
as practicable after receipt of a written notification of exercise and full
payment, the Company shall deliver to or on behalf of the Participant, in the
name of the Participant or other appropriate recipient, Share certificates for
the number of Shares purchased under the Option. Such delivery shall be effected
for all purposes when a stock transfer agent of the Company shall have deposited
such certificates in the United States mail, addressed to Participant or other
appropriate recipient.

8. Restrictions on Exercise. The Option may not be exercised if the issuance of
such Shares or the method of payment of the consideration for such Shares would
constitute a violation of any applicable federal or state securities or other
laws or regulations, including any such laws or regulations or Company policies
respecting blackout periods, or any rules or regulations of any stock exchange
on which the Common Stock may be listed.

9. Termination of Employment. Voluntary or involuntary termination of employment
and the death or Disability of Participant shall affect Participant’s rights
under the Option as follows:

(a) Termination for Cause. The vested and non-vested portions of the Option
shall expire on 12:01 am. (CST) on the date of termination of employment and
shall not be exercisable to any extent if Participant’s employment with the
Company is terminated for “Cause,” which for the purposes of this Agreement
shall have the meaning of such term in the termination or employment agreement
between the Participant and the Company (without regard to any requiring any
“change in control” as provided therein), and if neither applies, then as
defined in the Plan.

(b) Other Involuntary Termination or Voluntary Termination. If Participant’s
employment with the Company is terminated for any reason other than for Cause,
then (i) the non-vested portion of the Option shall immediately expire on the
termination date (ii) the vested portion of the Option shall remain outstanding
for the balance of the Option Period upon which the Option shall expire to the
extent not exercised. In no event may the Option be exercised after the
expiration of the Option.

10. Qualification as an Incentive Stock Option. The Participant understands that
the Option is intended to qualify as an “incentive stock option” within the
meaning of Section 422 of the Code, subject to the limitations of Section 422 of
the Code. The Participant must meet certain holding periods under Section 422(a)
of the Code to obtain the federal income tax treatment applicable to the
exercise of incentive stock options and the disposition of Shares acquired
thereby.

 

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The Participant further understands that the Option Price of this Option has
been set by the Committee at a price that the Committee determined to be not
less than 100% (or, if the Participant, at the Grant Date, owned more than 10%
of the total combined voting power of the Company’s outstanding voting
securities, 110%) of the Fair Market Value, as determined in accordance with the
Plan, of a Share on the Grant Date. The Participant further understands and
agrees, however, that neither the Company nor the Committee shall be liable or
responsible for any additional tax liability incurred by the Participant in the
event that the Internal Revenue Service for any reason determines that this
Option does not qualify as an “incentive stock option” within the meaning of the
Code.

11. Independent Legal and Tax Advice. Participant acknowledges that the Company
has advised Participant to obtain independent legal and tax advice regarding the
grant and exercise of the Option and the disposition of any Shares acquired
thereby.

12. Reorganization of Company. The existence of the Option shall not affect in
any way the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in Company’s capital structure or its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stock ahead of or affecting the Shares or the rights thereof,
or the dissolution or liquidation of the Company, or any sale or transfer of all
or any part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.

13. Adjustment of Shares. In the event of stock dividends, spin-offs of assets
or other extraordinary dividends, stock splits, combinations of shares,
recapitalizations, mergers, consolidations, reorganizations, liquidations,
issuances of rights or warrants and similar transactions or events involving
Company, appropriate adjustments shall be made to the terms and provisions of
this Option as provided in the Plan.

14. No Rights in Shares. Participant shall have no rights as a stockholder in
respect of the Shares until the Participant becomes the record holder of such
Shares.

15. Investment Representation. Participant will enter into such written
representations, warranties and agreements as Company may reasonably request in
order to comply with any federal or state securities law. Moreover, any stock
certificate for any Shares issued to Participant hereunder may contain a legend
restricting their transferability as determined by the Company in its discretion
that is reasonably necessary.

16. No Guarantee of Employment. The Option shall not confer upon Participant any
right to continued employment with the Company or any subsidiary or affiliate
thereof.

17. Withholding of Taxes. This Option is subject to and the Company shall have
the right to take any action as may be necessary or appropriate to satisfy any
federal, state, or local tax withholding obligations; provided however, that at
Participant’s election in the written notice for exercise, the Company shall
make deductions from the number of Shares otherwise deliverable upon exercise of
the Option in an amount sufficient to satisfy withholding of any federal, state
or local taxes required by law.

 

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18. General.

(a) Notices. All notices under this Agreement shall be mailed or delivered by
hand to the parties at their respective addresses set forth beneath their
signatures below or at such other address or method as may be designated in
writing by either of the parties to one another, including electronic notices.
Notices shall be effective upon receipt.

(b) Shares Reserved. Company shall at all times during the Option Period reserve
and keep available under the Plan such number of Shares as shall be sufficient
to satisfy the requirements of this Option.

(c) Nontransferability of Option. The Option granted pursuant to this Agreement
is not transferable other than by will, the laws of descent and distribution or
by a qualified domestic relations order (as defined in Section 414(p) of the
Internal Revenue Code). The Option will be exercisable during Participant’s
lifetime only by Participant or by Participant’s legal representative in the
event of Participant’s Disability. No right or benefit hereunder shall in any
manner be liable for or subject to any debts, contracts, liabilities,
obligations or torts of Participant.

(d) Amendment and Termination. No amendment, modification or termination of the
Option or this Agreement that is adverse to the Participant shall be made at any
time without the written consent of Participant and Company.

(e) No Guarantee of Tax Consequences. The Company and the Committee make no
commitment or guarantee that any federal or state tax treatment will apply or be
available to any person eligible for benefits under the Option. The Participant
has been advised and been provided the opportunity to obtain independent legal
and tax advice regarding the grant and exercise of the Option and the
disposition of any Shares acquired thereby.

(f) Severability. In the event that any provision of this Agreement shall be
held illegal, invalid, or unenforceable for any reason, such provision shall be
fully severable, but shall not affect the remaining provisions of the Agreement,
and the Agreement shall be construed and enforced as if the illegal, invalid, or
unenforceable provision had not been included herein.

(g) Supersedes Prior Agreements. This Agreement shall supersede and replace all
prior agreements and understandings, oral or written, between the Company and
the Participant regarding the grant of the Options covered hereby.

(h) Governing Law. The Option shall be construed in accordance with the laws of
the State of Delaware without regard to its conflict of law provisions, to the
extent federal law does not supersede and preempt Delaware law.

 

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IN WITNESS WHEREOF, the Company has, as of the Grant Date caused this Agreement
to be executed on its behalf by its duly authorized officer, and Participant has
hereunto executed this Agreement as of the same date.

 

PETROQUEST ENERGY, INC. By:                                
                           

Name:   Title:   Address:  

400 E. Kaliste Saloom Road

Suite 6000

Lafayette, Louisiana 70508

 

OPTIONEE By:                                                            

Name:   Title:   Address:                               
                                

 

[SIGNATURE PAGE TO OPTION AGREEMENT]