Exhibit 10.5.1
 
FIRST AMENDMENT
TO
EMPLOYMENT AGREEMENT

THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is made
effective as of December 22, 2016 between Synergy Resources Corporation, a
Colorado corporation (the “Company”), and Lynn A. Peterson (the “Executive”).

WITNESSETH

WHEREAS, Executive and the Company are party to that certain Employment
Agreement, dated as of May 27, 2015 (the “Employment Agreement”), pursuant to
which Executive is employed as President of the Company;

WHEREAS, Executive and the Company wish to amend the Employment Agreement to
clarify the rights and responsibilities of the parties upon termination of the
Employment Agreement and to remove certain extraneous language regarding same;
and

WHEREAS, Section 9.7 of the Employment Agreement permits the parties thereto to
amend the Employment Agreement by written instrument, and Executive and the
Company now wish to amend the Employment Agreement as set forth herein.

NOW THEREFORE, in consideration of the premises and of the mutual covenants and
agreements hereinafter contained, the parties hereto agree as follows.

AMENDMENT

1.    Article 4 of the Employment Agreement is hereby amended by removing the
existing Article 4 as set forth therein and replacing it with the following:

“4.    Termination.

4.1    If the Executive should die during the Term, this Agreement shall
terminate as of the date of the Executive's death, except that the Executive's
legal representatives shall be entitled to receive all compensation otherwise
payable to Executive through the last day of the month in which Executive's
death occurs and unvested equity grants or stock options, if any, that vest
solely upon the passage of time shall immediately vest. The foregoing shall not
apply to equity incentive awards that are earned and/or vested based on the
satisfaction of performance metrics or goals, which awards shall be governed
solely by their respective grant documents. The Executive's legal
representatives shall have the right to exercise outstanding options, if any,
for the first to occur of a period of one year or the expiration date of the
original term of such grant.

4.2    If, during the Term, the Executive shall become physically or mentally
disabled, whether totally or partially, so that the Executive is unable
substantially to perform his services hereunder for (i) a period of two
consecutive months, or (ii) for shorter periods aggregating four months during
any twelve-month period, the Company may, at any time after the last day of the
second consecutive month of disability or the day on which the shorter periods
of disability shall have equaled an aggregate of four months, by written notice
to the Executive (but before the Executive has recovered from such
disability),terminate this Agreement. Notwithstanding such disability, the
Company shall continue to pay the Executive his full salary up to and including
the date of such termination. Upon termination for disability, unvested equity
grants and stock options, if any, that vest solely upon the passage of time
shall immediately vest. The foregoing shall not apply to equity incentive awards
that are earned and/or vested based on the satisfaction of performance metrics
or goals, which awards shall be governed solely by their respective grant
documents. The Executive shall have the right to exercise outstanding options,
if any, for the first to occur of a period of one year or the expiration date of
the original term of such grant.

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4.3     In the event of (i) conviction of the Executive of any crime or offense
involving the property of the Company, or any of its subsidiaries or affiliates,
fraud or moral turpitude, and such crime or offense significantly harms the
business operations of the Company, (ii) the refusal of Executive to follow the
lawful directions of the Company's Board of Directors (the "Board") within a
reasonable period after delivery to Executive of written notice of such
directions, (iii) the Executive's gross negligence, and such gross negligence
significantly harms the business operations of the Company (gross negligence
does not include errors of judgment, mistakes, or discretionary decisions, but
is conduct which shows a reckless or willful disregard for reasonable business
practices), or (iv) a breach of this Agreement by Executive which Executive
fails to cure within thirty days after notice from the Board, or fails to
diligently pursue a cure if the breach is not able to reasonably be cured within
30 days (any such event, a "Cause Event"), then the Company may terminate
Executive's employment hereunder by written notice to Executive in which event
Executive shall be entitled to receive all compensation otherwise payable to
Executive through the date of termination.

4.4    [Reserved].

4.5    In the event the Company shall terminate Executive's employment hereunder
without the occurrence of a Cause Event and not due to death or disability, and
not on or within twelve (12) months following a Change of Control, the Company
shall promptly, but in no event later than sixty (60) days, pay to Executive by
certified check, wire transfer funds, or other form of payment reasonably
acceptable to Executive, a lump sum amount to the sum of (i) two (2) times the
Executive's annual salary at such compensation rate as is then in effect under
the terms of this Agreement, and any extension or renewal thereof, plus (ii)
Executive's most recent bonus. Such payment shall not be reduced by any charges,
expenses, debts, set-offs or other deductions of any kind whatsoever except for
required withholding taxes. All of Executive's unpaid or unvested equity grants
and stock options that vest solely upon the passage of time shall be immediately
vested. The foregoing shall not apply to equity incentive awards that are earned
and/or vested based on the satisfaction of performance metrics or goals, which
awards shall be governed solely by their respective grant documents.

4.6    Constructive Termination shall occur if the Executive resigns his
employment within ninety (90) days of the occurrence of any of the following
events: (i) a relocation (or demand for relocation) of Executive's place of
employment to a location more than thirty-five (35) miles from Executive's
current place of employment, (ii) the Board materially interferes with the
performance of the Executive's duties, (iii) if a Change of Control event has
occurred; (iv) the Company shall fail to nominate the Executive for nomination
or appointment to the Board of Directors of the Company; (v) the Company's
material breach of this Agreement or any other written agreement between
Executive and the Company; provided the Company is given notice of said breach
and provided an opportunity to cure such breach for 30 days from the date of
such notice; (vi) the material diminution of the Executive's duties
responsibilities, authority, offices or titles in effect as of the Effective
Date; or (vii) a reduction of Executive's salary, or adverse modifications to
the stock awarded to Executive under this Agreement, or to the Company's stock
plan (or any other similar plan), or a material reduction in Executive's total
compensation under this Agreement, except for any reductions equally applicable
to all executive officers of the Company as approved by the Board.

"Change of Control" shall mean a change in ownership or control of the Company
as a result of any of the following transactions:

(a)    a merger, consolidation or other business combination transaction of the
Company with or into another corporation entity or person, whether or not
approved by the Board of Directors of the Company, other than a transaction that
would result in the holders of at least 50% of the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted or into voting securities of the
surviving entity or the parent of the surviving entity) at least 50% of the
total voting power represented by the voting securities of the Company or such
surviving entity (or the parent of any such surviving entity) outstanding
immediately after such transaction; or

(b)    any stockholder-approved transfer or other disposition of all or
substantially all of the Company's assets, or

(c)    the acquisition, directly or indirectly by any person or related group of
persons (other than the Company or a person that directly or indirectly
controls, is controlled by, or is under common control with, the Company), of
beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of
securities possessing more than fifty percent (50%) of the total voting power of
the Company's outstanding securities;
(d)    a change in the composition of the Board over a period of thirty-six (36)
months or less such that a majority of the Board members, by reason of one or
more contested elections for Board membership, are no longer comprised of
individuals who (A) were Board members at the beginning of such period or (B)
have

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been elected or nominated for election as Board members during such period by at
least a majority of Board members described in clause (A).

    In the event a Constructive Termination event has occurred, other than on or
within twelve (12) months following a Change of Control, Executive may, in his
sole discretion, provide Company with his written notice of resignation within
ninety (90) days of the occurrence of any of the Constructive Termination
events, to be effective not less than thirty (30) days after receipt by Company,
whereupon Executive shall cease to be employed by the Company. Upon receipt of
such notice of resignation, Company shall promptly, but in no event later than
sixty (60) days after the effective date of the, termination, pay to Executive
by certified check, wire transfer funds, or other form of payment reasonably
acceptable to Executive, a lump sum amount equal to the sum of (i) two (2) times
the Executive's annual salary at such compensation rate as is then in effect
under the terms of this Agreement, and any extension or renewal thereof, plus
(ii) Executive's most recent bonus. Such payment shall not be reduced by any
charges, expenses, debts, set-offs or other deductions of any kind whatsoever
except for required withholding taxes. All of Executive's unpaid or unvested
equity grants and stock options that vest solely upon the passage of time shall
be immediately vested. The foregoing shall not apply to equity incentive awards
that are earned and/or vested based on the satisfaction of performance metrics
or goals, which awards shall be governed solely by their respective grant
documents.

    In the event of a Change of Control, if the Company shall terminate
Executive's employment hereunder without the occurrence of a Cause Event on or
within twelve (12) months following a Change of Control and not due to death or
disability, or if during such time period a Constructive Termination event has
occurred and Executive has, within (90) days of the occurrence of any of the
Constructive Termination events, given written notice of resignation to be
effective not less than thirty (30) days after receipt by Company (whereupon
Executive shall cease to be employed by the Company), then the Company shall
promptly, but in no event later than sixty (60) days, pay to Executive by
certified check, wire transfer funds, or other form of payment reasonably
acceptable to Executive, a lump sum amount equal to the sum of (i) three (3)
times the Executive's annual salary at such compensation rate as is then in
effect under the terms of this Agreement, and any extension or renewal thereof,
plus (ii) Executive's most recent bonus. Such payment shall not be reduced by
any charges, expenses, debts, set-offs or other deductions of any kind
whatsoever except for required withholding taxes. All of Executive's unpaid or
unvested equity grants and stock options that vest solely upon the passage of
time shall immediately vest in such event (to the extent such awards remain
outstanding after the Change in Control). The expiration date of any options
which remain outstanding after the Change in Control and which would expire
during the six month period following the date of termination pursuant to this
paragraph will be extended to the date which is the earlier to occur of twelve
months after the date of the termination or the expiration date of the original
term of such grant. The foregoing shall not apply to equity incentive awards
that are earned and/or vested based on the satisfaction of performance metrics
or goals, which awards shall be governed solely by their respective grant
documents.

4.7     In the event of a Change of Control, whether or not followed by
termination of Executive's employment, all of Executive's unpaid or unvested
equity grants and stock options that vest solely upon the passage of time shall
be immediately vested. The foregoing shall not apply to equity incentive awards
that are earned and/or vested based on the satisfaction of performance metrics
or goals, which awards shall be governed solely by their respective grant
documents. Nothing herein shall require that the Company or any successor to
maintain any then-outstanding equity incentive awards following the occurrence
of a Change in Control.

4.8     In the event of a Change of Control and subject to the Executive being
terminated from employment on or within twelve (12) months following the Change
in Control for any reason other than the occurrence of a “Cause Event” or as a
result of Executive’s voluntary termination of employment without the occurrence
of a Constructive Termination, Executive shall receive the value of 18 months of
COBRA premiums paid in a cash lump sum no later than sixty (60) days after the
date of termination.

4.9     If the Executive is a "specified employee" as such term is defined under
Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"), on
the date of his termination of employment and if the benefits to be provided
under this Agreement are subject to Section 409A of the Code and are payable on
account of a termination of employment, payment in respect of such benefits
shall not be paid or commence until the earliest of (i) the first business day
that is six months after the date of termination of employment, (ii) Executives
date of death, or (iii) such other earlier date for which such payment will not
be subject to additional tax or interest imposed by Section 409A of the Code,
and shall otherwise be paid as provided in this Agreement.

4.10     Notwithstanding any of the above to the contrary, the Executive will
not be entitled to any of the payments provided in this Article 4 (other than in
connection with a Change of Control) if (i) the Executive materially breaches
this Agreement, including the provisions of Article 5, or (ii) the Executive
fails to execute and return an effective

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release from liability and waiver of right to sue the Company or its affiliates
in a form reasonably acceptable to the Company waiving all claims the Executive
may have against the Company, its affiliates, and their predecessors,
successors, assigns, employees, officers and directors and such other parties
and in such form as determined by the Company in its sole discretion within
fifty-two (52) days after the date of termination of the Executive's employment
(or such shorter period as may be required to be provided by law or as
determined by the Company and provided in the release), and the release becoming
effective.

4.11     To the extent any amount payable under this Article 4 is deferred
compensation subject to the Code, if the period during which the Executive has
discretion to execute or revoke the general release of claims straddles two of
your taxable years, then the Company shall make the severance payments starting
in the second of such taxable years, regardless of which taxable year the
Executive actually deliver the executed general release of claims to the
Company. The Executive may not, directly or indirectly, designate the calendar
year or timing of payments.”

2.    Except for the above amendment, the Employment Agreement shall be
unamended and shall continue in full force and effect.

[Remainder of Page Intentionally Blank]

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IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and
year first above written.
 
SYNERGY RESOURCES CORPORATION
 
 
 
/s/ James P. Henderson
 
James P. Henderson
 
Chief Financial Officer
 
 
 
EXECUTIVE
 
 
 
/s/ Lynn A. Peterson
 
Lynn A. Peterson