Exhibit 10.1

 

Sabine Oil & Gas LLC

1415 Louisiana Street, Suite 1600, Houston, TX 77002

 

Main: 832-242-9600  Fax: 832-242-9560

 

December 12, 2014

 

Michael Magilton

 

Dear Michael,

 

Sabine Oil & Gas LLC (“Sabine”) is very pleased to offer you the position of
Senior Vice President and Chief Financial Officer with Sabine.  You will report
to David Sambrooks, Chief Executive Officer.  As you know, Sabine and Forest Oil
Corporation (“Forest”) have entered into an agreement to combine our businesses
(the “Combination”). Sabine and its affiliates (“we”) believe you will be a key
contributor and we would like you to continue as Senior Vice President and Chief
Financial Officer of the combined company (the “Company”) following a closing of
the Combination (the “Closing”).

 

Although this letter does not provide a comprehensive detailed listing of your
compensation and benefits, the general terms are noted below.

 

Bi-Weekly Salary:

 

$11,923.08 (annual equivalent of $310,000).

 

 

 

Office Location:

 

Houston, Texas

 

 

 

Annual Target Bonus:

 

Your target bonus shall be 60% of base salary. The Annual Bonus is discretionary
and will be subject to the achievement of individual and company performance
objectives established from time to time by the Compensation Committee of Sabine
or the Company, as applicable, (the “Compensation Committee”) in its sole
discretion.  You will be eligible for a bonus payout in 2015 based on 2014
performance if you commence employment on or before October 1, 2014 (prorated
based on the number of days in 2014 that you were employed by Sabine or the
Company). If you commence employment after October 1, 2014, you will be eligible
for a bonus payout in 2016 based on 2015 performance.

 

 

 

Sign-On Long Term Incentive Award:

 

Shareholders of Forest approved the Forest Oil Corporation 2014 Long Term
Incentive Plan (the “LTIP”) which will become effective immediately prior to the
Closing. Upon the Closing, we will (or will cause the Company to) recommend to
the Compensation Committee that a grant be made to you under the LTIP as soon as
practicable following the Closing (the “Award”). The recommended Award will be
no less than 600,000 shares of restricted stock of the Company (subject to
appropriate adjustment for any stock splits or other corporate actions affecting
shares granted pursuant to the Award, consistent with the terms of the LTIP). We
plan to make this recommendation to the Compensation Committee following the
Closing. We will (or will cause the Company to) recommend to the Compensation
Committee that the Award will vest in one-fourth increments on each of the first
four anniversaries of the date of grant of the Award, subject to your continued
employment by the Company on each such anniversary. The Award will be subject to
the approval of the Compensation Committee and subject to the terms of the award
agreement pursuant to which the Award is granted and the terms of the LTIP, as
in effect from time to time. You will also be eligible to receive additional
awards under the LTIP in the future, subject to the discretion and approval of
the Compensation Committee.

 

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Paid Time Off:

 

You will be eligible for 4 weeks of paid time off on an annual basis, prorated
in 2014 for the number of days in 2014 during which you are employed by Sabine
or the Company. You will also be eligible to take up to 7 paid sick days on an
annual basis.

 

 

 

Benefits, Retirement and Perquisites:

 

You will be eligible to participate in medical, dental and vision insurance
plans sponsored by Sabine or the Company. Further, you will be eligible to
participate in Sabine or the Company’s 401(k) plan and Sabine or the Company
will match your contributions up to 6% of all eligible compensation (subject to
change based Internal Revenue Service rules and regulations). Finally, Sabine or
the Company will subsidize a membership to a health club facility of your choice
up to a maximum of $750 per month, subject to change or elimination at the
discretion of the Company.

 

Any payments made to you pursuant to this letter are subject to standard
withholding and deductions. You acknowledge and agree that neither Forest,
Sabine, the Company nor any of their affiliates, officers, or agents makes or
has made any representation about the tax consequences of any payments or
benefits offered to you under this letter. The amounts and benefits provided
pursuant to this letter are intended to comply with the short term deferral
exception to Section 409A of the Internal Revenue Code (the “Code”), set forth
in Treas. Reg. §1.409A-1(b)(4), and shall be interpreted accordingly. To the
extent that any in-kind benefits or reimbursements pursuant to this letter are
taxable to you and constitute deferred compensation subject to Section 409A of
the Code, any reimbursement payment due to you will be paid on or before the
last day of your taxable year following the taxable year in which the related
expense was incurred.  In addition, any such in-kind benefit or reimbursement is
not subject to liquidation or exchange for another benefit and the amount of
such benefit or reimbursement that you receive in one taxable year shall not
affect the amount of such benefit and reimbursements that you receive in any
other taxable year.

 

This letter shall be construed, interpreted, and the rights of the parties
determined in accordance with the laws of the State of Texas (without regard to
the conflicts of laws principles thereof) and applicable Federal law.

 

This letter does not affect the at-will employment relationship between you and
Sabine or the Company. Either you or Sabine or the Company, as applicable, may
terminate your employment at any time and for any reason, with or without Cause
or notice.

 

Your employment is contingent on successful completion of background check and
pre-employment drug testing.

 

Michael, we are excited about working with you. If you have any questions,
please contact me at (832) 242-9600.

 

Sincerely,

 

 

/s/ David Sambrooks

 

David Sambrooks

 

Chief Executive Officer

 

Sabine Oil & Gas LLC

 

 

 

Please indicate your acceptance of the above offer of employment by your
signature, and return one copy of the signed letter to Yamoria Miller by
December 18, 2014. Thank you.

 

 

/s/ Michael Magilton

 

December 15, 2014

Michael Magilton

 

Date

 

2

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