Exhibit 10.1

 

LOGO [g96197constellation-logo.jpg]   500 Dallas, Suite 3300   Houston, TX 77002

December 31, 2008

Mr. Stephen R. Brunner

500 Dallas Street, Suite 3300

Houston, TX 77002

Dear Steve:

We are pleased to confirm to you our offer of employment as President, Chief
Executive Officer and Chief Operating Officer of Constellation Energy Partners
LLC (the “Company”), effective January 1, 2009. A summary of the key terms of
your compensation package are provided in Exhibit A hereto. We anticipate
finalizing the terms of your employment in an employment agreement (the
“Definitive Agreement”) to be entered into in early 2009. Upon our execution of
the Definitive Agreement, the precise terms of your employment will be subject
in all cases to the terms and conditions of the Definitive Agreement.

In joining the Company, we recognize that you retain the option, as does the
Company, of ending your employment at any time, with or without notice and with
or without cause. As such, your employment will be at-will, and neither this
letter nor any other oral or written representations may be considered a
contract requiring the Company or you to maintain your employment for any
specific period of time. While the parties will have this freedom to terminate
your employment, the Company recognizes that certain terminations will have
specific consequences under the terms of your employment, in each case as
initially described in this letter and, upon execution by the Company and you of
the Definitive Agreement, as provided in the Definitive Agreement. In addition,
except where state law prohibits, the Company maintains a random drug testing
program to which you will be expected to submit as a condition of continued
employment.

This offer of employment is contingent on your execution and return to us of
this offer letter.

If this letter outlines your understanding as to the terms of your employment,
please sign and return a copy of this letter to me to indicate your
understanding and acceptance of the terms of your employment. If you have any
questions, please contact me at xxx-xxx-xxxx.

 

Sincerely,

/s/ John N. Seitz

John N. Seitz

Chairman, Compensation Committee

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I acknowledge and accept the terms and conditions set forth in this offer
letter.

 

/s/ Stephen R. Brunner

   

12/31/2008

Stephen R. Brunner     Date Signature    

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EXHIBIT A

Summary of Key Compensation Terms

Stephen R. Brunner

 

Annual Base Salary    Initially, $300,000, earned and paid bi-weekly.
Annual Incentive Plan   

Participation in Company’s Annual Incentive Plan, which will be developed during
the first quarter of 2009;

 

An annual incentive award opportunity for 2009 of 100% of Annual Base Salary for
the achievement of Target Level Performance;

 

Up to 200% of Annual Base Salary for superior performance;

 

Performance will be determined by the Compensation Committee of the Board of
Managers, pursuant to the terms and conditions of the Annual Incentive Plan.

Long-Term Incentive   

Participation in Company’s Long-Term Incentive Plan;

 

2009 award:

 

•     $1.2 million expected value as of the date of grant;

 

•     Equity-Favored Grant; and

 

•     Vesting ratably on a yearly basis, and/or earned (subject to Company
performance), over 3 years.

 

“Equity-Favored Grant” means a grant that may have both cash and equity-based
components, as determined by the Compensation Committee in its sole discretion,
and is geared to include as much of an equity-based component as possible given
the number of common units then available under the Long-Term Incentive Plan.

Inducement Bonus   

$600,000 expected value at the date on which the parties enter into a Definitive
Agreement;

Equity-Favored Grant;

 

50% of the total value of the bonus will vest and be payable on each the first
and second anniversaries of the execution of the Agreement; and

 

Accelerated vesting upon involuntary termination (other than for cause) or
voluntary termination for good reason, in each case as such terms are
customarily defined.

Benefits    Eligibility to participate in Company plans available to all
full-time employees. Change in Control   

Upon the occurrence of an involuntary termination (other than for cause) or
voluntary termination for good reason following a change in control event (as
such term will be defined in the Definitive Agreement), then:

 

•     Cash payment (within 60 days) of 200% of then-current Annual Base Salary
plus target Annual Incentive;

 

•     Cash payment (within 60 days) of then-current Annual Incentive paid out as
if Target Level Performance were achieved, prorated on monthly basis;

 

•     Immediate accelerated vesting of all outstanding service-based Long-Term
Incentive awards and Inducement Bonus;

 

•     Cash payment (within 60 days) of outstanding performance-based Long-Term
Incentive, paid out as if Target Level Performance were achieved, prorated on
monthly basis;

 

•     Continuation of Benefits for 1-year period; and

 

•     Full tax gross-up on (i) any excise tax resulting from the immediately
preceding 5 bullets and (ii) any income tax resulting from the gross-up
described in clause (i) of this bullet.

 

Complete definitions, terms and conditions will be provided in the Definitive
Agreement.