**Exhibit 10.4**

 

 

**EMPLOYEE BENEFITS AGREEMENT**

 

**DATED AS OF SEPTEMBER 9, 2005**

 

 

**BETWEEN**

 

 

**FOREST OIL CORPORATION**

 

 

**AND**

 

 

**SML WELLHEAD CORPORATION**

 

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**TABLE OF CONTENTS**

 
| ARTICLE I                       |
|--------------------------------------|
| DEFINITIONS                          |
|                                 |   |   |
| Section 1.1                     | General | 1 |
|                                 |   |   |
| ARTICLE II                      |
| EMPLOYEES; ASSUMPTION OF LIABILITIES |
|                                 |   |   |
| Section 2.1                     | Employees | 3 |
| Section 2.2                     | Assumption of  Liabilities | 4 |
|                                 |   |   |
| ARTICLE III                     |
| FOREST STOCK OPTIONS                 |
|                                 |   |   |
| Section 3.1                     | Vested Options | 5 |
| Section 3.2                     | Unvested Options | 5 |
|                                 |   |   |
| ARTICLE IV                      |
| GENERAL                              |
|                                 |   |   |
| Section 4.1                     | Sharing of Employee  Information | 6 |
| Section 4.2                     | Non-Solicitation of  Employees | 6 |
| Section 4.3                     | Effect if  Distribution Does Not Occur | 6 |
| Section 4.4                     | Relationship of  Parties | 6 |
| Section 4.5                     | Indemnification | 6 |
| Section 4.6                     | Survival | 8 |
| Section 4.7                     | Notices | 8 |
| Section 4.8                     | Interpretation | 8 |
| Section 4.9                     | Governing Law | 9 |
| Section 4.10                    | No Assignment | 9 |
| Section 4.11                    | Third Party  Beneficiary | 9 |
| Section 4.12                    | Amendment | 9 |
| Section 4.13                    | Termination | 9 |
| Section 4.14                    | Counterparts | 9 |

 

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**EMPLOYEE BENEFITSAGREEMENT**

** **

This EMPLOYEE BENEFITSAGREEMENT (this “Agreement”) is dated as of September 9, 2005 by andbetween Forest Oil Corporation, a New York corporation (“Forest”), and SMLWellhead Corporation, a Delaware corporation and a wholly owned subsidiary of Forest(“Spinco”).

 

**RECITALS**

** **

WHEREAS, Forest intends totransfer or cause to be transferred to Spinco the Spinco Assets (as definedbelow) and certain associated liabilities (the “Contribution”) in exchange forcash and shares of Spinco Common Stock (as defined below);

 

WHEREAS, subsequent tothe Contribution, all of the issued and outstanding shares of common stock ofSpinco will be distributed on a pro rata basis to the holders of theoutstanding common stock of Forest (the “Distribution”);

 

WHEREAS, following theDistribution, pursuant to the terms of the Agreement and Plan of Merger datedas of September 9, 2005 (the “Merger Agreement”) by and between Forest,Spinco, Mariner Energy, Inc., a Delaware corporation (the “Company”), and MEISub, Inc., a Delaware corporation and a wholly owned subsidiary of the Company(“Merger Sub”), Merger Sub will merge with and into Spinco, with Spinco beingthe surviving corporation;

 

WHEREAS, Forest andSpinco have entered into a Distribution Agreement dated as of the date hereof(the “Distribution Agreement”) and certain other agreements that will governmatters relating to the Distribution and the relationship of Forest and Spincofollowing the Distribution;

 

WHEREAS, pursuant to theDistribution Agreement, Forest and Spinco have agreed to enter into thisAgreement for purposes of allocating employees whose primary responsibilitiesinclude activities necessary to carry out or support the Spinco Business (asdefined below) and assets, liabilities, and responsibilities with respect toemployee compensation, benefits and other matters.

 

NOW, THEREFORE, inconsideration of the mutual promises contained herein and in the DistributionAgreement, the parties hereto hereby agree as follows:

 

# **ARTICLE IDEFINITIONS**

# ** **

Section1.1                                      *General*.  As used inthis Agreement, the following terms shall have the following meanings (suchmeanings to be equally applicable to both the singular and plural forms of theterms defined):

 

*Affiliate*:  has the meaning given in the DistributionAgreement.

 

*Agreement*:  means this Employee Benefits Agreement, andall exhibits and schedules hereto.

 

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*Company*:  has the meaning given in the third recital ofthis Agreement.

 

*CompanySavings Plan*:  has themeaning given in the Merger Agreement.

 

*Distribution*:  has the meaning given in the second recitalof this Agreement.

 

*DistributionAgreement*:  has themeaning given in the fourth recital of this Agreement.

 

*DistributionDate*:  has the meaninggiven in the Distribution Agreement.

 

*Forest*:  has the meaning given in the first paragraphof this Agreement.

 

*ForestCommon Stock*:  has themeaning given in the Distribution Agreement.

 

*ForestEducational Assistance Plan*: means the Forest educational assistance plan.

 

*ForestIncentive Plans*: means (a) the Forest Stock IncentivePlan; (b) the Forcenergy Inc. 1999 Stock Plan; and (c) the Forest2001 Stock Incentive Plan.

 

*ForestIndemnitees: *has themeaning given in the Distribution Agreement*.*

 

*ForestPlans*:  means the ForestSavings Plan, the Forest Educational Assistance Plan,  the Forest Vacation Policy, the ForestIncentive Plans and all other employee benefit plans, policies, agreements andarrangements of Forest.

 

*ForestSavings Plan*:  means Forest’sRetirement Savings Plan.

 

*ForestStock Option*:  means anoption to acquire Forest Common Stock granted pursuant to a Forest IncentivePlan.

 

*ForestVacation Policy*:  meansthe Forest vacation policy.

 

*Group*:has the meaning given in the Distribution Agreement.

 

*IndemnifiableLosses*: has the meaning given in the Distribution Agreement.

 

*IndemnifyingParty*: has the meaning given in the Distribution Agreement.

 

*Indemnitee*:has the meaning given in the Distribution Agreement.

 

*MeasurementDate*:  has the meaninggiven in the Distribution Agreement.

 

*MergerAgreement*:  has themeaning given in the third recital of this Agreement.

 

*RetainedEmployee*:  means anyindividual (a) who, as of the close of business on the Distribution Date,is actively employed by, or on an approved leave of absence or layoff withright of recall from, Forest or any individual who was at any time on or priorto the Distribution Date employed by Forest or any of its Affiliates and (b) whois not a Spinco Employee.

 

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*RetainedEmployee Liabilities*: has the meaning given in Section 2.2(b).

 

*Spinco*:  has the meaning given in the first paragraphof this Agreement.

 

*SpincoAssets*:  has themeaning given in the Distribution Agreement.

 

*SpincoBusiness*:  has themeaning given in the Distribution Agreement.

 

*SpincoCommon Stock*:  has themeaning given in the Distribution Agreement.

 

*SpincoEmployee*:  means (a) anyindividual listed on Schedule A attached hereto and (b) any otherindividual identified by Forest whose transfer to Spinco was approved by theCompany (whether a specific approval of an individual employee or an approvalof a reasonably identifiable and limited class of employees), such approval notto be unreasonably withheld, and in either case, who, as of the close of theDistribution Date, is actively employed by, or on an approved leave of absenceor layoff with right of recall from, Spinco.

 

*SpincoEmployee Liabilities*: has the meaning given in Section 2.2(a).

 

*SpincoIndemnitees*:  has themeaning given in the Distribution Agreement.

 

*Third-PartyClaim*:  has the meaninggiven in the Distribution Agreement.

 

*TransactionAgreement*: has the meaning given in the Merger Agreement.

 

*UnvestedForest Stock Option*: means the portion of a Forest Stock Option representing the shares of ForestCommon Stock for which such option is not exercisable as of the DistributionDate.

 

*Vested ForestStock Option*:  meansthe portion of a Forest Stock Option representing the shares of Forest CommonStock for which such option is exercisable as of the Distribution Date.

 

# **ARTICLE IIEMPLOYEES; ASSUMPTION OF LIABILITIES**

# ** **

Section 2.1*             Employees.*

 

### (a)                                  *General. *Effectiveas of the Distribution Date, Spinco Employees shall be employees of Spinco andRetained Employees shall be employees of Forest.  Except as otherwise expressly provided hereinor as required by applicable law, effective as of the Distribution Date eachSpinco Employee shall be considered to have incurred a termination ofemployment for purposes of all Forest Plans. Except as otherwise expressly provided herein, no provision of thisAgreement or the Distribution Agreement shall be construed to create any right,or accelerate entitlement, to any compensation or benefit whatsoever on thepart of any Spinco Employee or other future, present, or former employee of Forestor Spinco under any Forest Plan or otherwise.

 

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### (b)                                 *No Right to Continued Employment. *Nothing contained in thisAgreement shall confer on any Spinco Employee or Forest Employee any right tocontinued employment.

###  

### (c)                                  *Forest Savings Plan. *At the Distribution Date, to the extent doing so will notadversely affect the tax-qualified status of the Forest Savings Plan, SpincoEmployees who are not 100% vested in their benefits in the Forest Savings Planwill be 100% vested in their benefits accrued as of such date.  Effective as of the Distribution Date, SpincoEmployees shall be considered to have incurred a termination of employment forpurposes of the Forest Savings Plan; provided, however, that, due to thepending transfer of assets and liabilities with respect to the Spinco Employeesfrom the Forest Savings Plan to the Company Savings Plan as contemplated in Section 6.8of the Merger Agreement, a Spinco Employee shall be deemed to have not incurreda termination of employment (unless such employee has also terminatedemployment after the Distribution Date with Spinco, the Company and theirsubsidiaries) for purposes of (i) outstanding loans under the ForestSavings Plan as of the Distribution Date, (ii) the right to makein-service withdrawals under the Forest Savings Plan, and (iii) theentitlement to distributions upon termination of employment under the ForestSavings Plan.

###  

### (d)                                 *Forest Educational Assistance Plan.*Effectiveas of the Distribution Date, Spinco shall assume the liability under the ForestEducational Assistance Plan for any and all educational assistance benefitspayable on and after the Distribution Date with respect to any Spinco Employeewho is enrolled in one or more classes on the Distribution Date and who maybecome eligible for benefits under the Forest Educational Assistance Plan withrespect to such class or classes; provided, however, that Spinco shall not berequired to assume any such liability to the extent related to a semesterbeginning after the semester during which the Distribution Date occurs.  The amount of, and eligibility of any suchSpinco Employee for, such benefits shall be determined by Spinco in accordancewith the terms of the Forest Educational Assistance Plan as in effect on theDistribution Date.  After the semesterduring which the Distribution Date occurs, Spinco shall cause the SpincoEmployees who are employed by Spinco, the Company or any of their Affiliates tobe eligible for participation in the Company’s educational assistance plan.

###  

### (e)                                  *Forest Vacation Policy. *Effective as of the DistributionDate, Spinco shall assume all liability with respect to any vacation which hasaccrued, in respect of the calendar year in which the Distribution Date occurs,for the benefit of any Spinco Employee as of the Distribution Date under the ForestVacation Policy.

###  

### (f)                                    Forestand Spinco hereby agree to use commercially reasonable efforts to implement thealternate procedure described in Section 5 of Revenue Procedure 2004-53.

###  

Section 2.2*             Assumption of Liabilities.*

 

### (a)                                  *Assumption by Spinco. *Subject to satisfaction by Forest of its obligationshereunder, Spinco and its Affiliates hereby assume and agree to pay, perform,fulfill and discharge, in accordance with their respective terms, as suchrelate to the Spinco Employees, (i) all of the  liabilities relating to, arising out of, orresulting from obligations, liabilities, and responsibilities expressly assumedor retained by Spinco pursuant to this Agreement, regardless of when or wheresuch liabilities arose or arise or were or are incurred, (ii) all of theliabilities 

 

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### relating to or arising from the Spinco Employees tothe extent arising from and after the Measurement Date and attributabledirectly to the conduct of the Company, and (iii) all of the liabilitiesof Forest or any of its Affiliates relating to or arising from the SpincoEmployees to the extent arising from and after the Distribution Date andattributable to the conduct of the Spinco Business after the Distribution Date(other than any such liabilities relating to benefits under the Forest Plansthat are not assumed by Spinco pursuant to the express terms of this Agreement,the Distribution Agreement or the Merger Agreement) (collectively, the “SpincoEmployee Liabilities”).

###  

### (b)                                 *Assumption by Forest. *All liabilities relating to or arising from (i) theSpinco Employees to the extent arising prior to the Distribution Date orattributable to the conduct of the Spinco Business prior to the DistributionDate (other than any such liabilities relating to, arising out of, or resultingfrom obligations, liabilities, or responsibilities expressly assumed orretained by Spinco pursuant to this Agreement, the Distribution Agreement orthe Merger Agreement, regardless of when or where such liabilities arose orarise or were or are incurred) and (ii) the Retained Employees, shall beassumed and retained by Forest, and Forest agrees to pay, perform, fulfill, anddischarge in accordance with their respective terms all of such liabilities,regardless of when or where such liabilities arose or arise or were or areincurred (“Retained Employee Liabilities”).

###  

# **ARTICLE IIIFOREST STOCK OPTIONS**

# ** **

Section3.1                                      *Vested Options*. Effective as of the Distribution Date, each Forest Stock Option held bya Spinco Employee who is eligible for retirement as of the Distribution Dateunder the terms of the Forest Stock Option agreement evidencing such optionshall be 100% exercisable and such option shall be a Vested Forest Stock Optionfor purposes hereof.  In addition,effective as of the Distribution Date, each Spinco Employee shall be consideredto have terminated employment for a reason other than death, disability,retirement or cause (as described in the applicable Forest Stock Optionagreement) with respect to each Vested Forest Stock Option held by suchemployee (and the applicable Forest Incentive Plan as it relates to suchoption); provided, however, that if such employee is eligible for retirement asof the Distribution Date under the terms of the Forest Stock Option agreementevidencing any such option, such employee shall be treated as having terminatedemployment as of the Distribution Date due to retirement for purposes of suchoption.  The exercise of a Vested ForestStock Option on or after the Distribution Date shall be subject to the terms ofthe Forest Stock Option agreement evidencing such option after giving effect tothe foregoing provisions of this Section 3.1.  Not later than immediately before theDistribution, Forest shall have taken such actions as may be required to effectthis Section 3.1.

 

Section 3.2                                      *Unvested Options*. Effective as of the Distribution Date, (a) each Spinco Employeeshall not be considered to have terminated employment with respect to eachUnvested Forest Stock Option held by such employee (and the applicable ForestIncentive Plan as it relates to such option) and (b) each Unvested ForestStock Option held by such employee shall be subject to adjustment as providedin the Merger Agreement.

 

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# **ARTICLE IVGENERAL**

 

Section 4.1                                      *Sharing of Employee Information*.  Forest and Spinco and their respectiveauthorized agents shall, subject to applicable laws on confidentiality, begiven reasonable and timely access to, and may make copies of, all informationrelating to the subjects of this Agreement in the custody of the other party,to the extent necessary for implementation of this Agreement.

 

Section 4.2                                      *Non-Solicitation of Employees*.  For a period of two years from the close ofthe Distribution Date, Spinco, the Company and their respective Affiliates willnot, without the prior written consent of Forest, and Forest and its Affiliateswill not, without the prior written consent of Spinco or the Company, whetherdirectly or indirectly, solicit (in writing or orally) for employment or otherservices, whether as an employee, officer, director, agent, consultant orindependent contractor, any person who or which is at the time of suchsolicitation an employee, agent, representative, officer or director of theother party or its Affiliates; provided, however, that this covenant shall not (a) applyto any individual whose employment, agency, representative, officer, directoror consultant relationship with the other party has terminated or (b) prohibita general solicitation by advertisement or otherwise (and  from thereafter soliciting or hiring anyindividual who responds to such general solicitation).

 

Section 4.3                                      *Effect if Distribution Does Not Occur*.  If the Distribution does not occur, then allactions and events that are, under this Agreement, to be taken or occureffective as of the Distribution Date, after the Distribution Date, orotherwise in connection with the Distribution, shall not be taken or occurexcept to the extent specifically agreed by Forest and Spinco.

 

Section 4.4                                      *Relationship of Parties*. Nothing in this Agreement shall be deemed or construed by the parties orany third party as creating the relationship of principal and agent,partnership or joint venture between the parties, it being understood andagreed that no provision contained herein, and no act of the parties, shall bedeemed to create any relationship between the parties other than therelationship set forth herein.

 

Section 4.5                                      *Indemnification.*

 

(a)                                  Exceptas specifically otherwise provided in the other Transaction Agreements, Spincoshall indemnify, defend and hold harmless the Forest Indemnitees from andagainst all Indemnifiable Losses arising out of or relating to any SpincoEmployee Liability.  Except asspecifically otherwise provided in the other Transaction Agreements, Forestshall indemnify, defend and hold harmless the Spinco Indemnitees from andagainst all Indemnifiable Losses arising out of or relating to any RetainedEmployee Liability.

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### (b)                                 Indemnificationfor matters subject to the Tax Sharing Agreement is governed by the terms,provisions and procedures of the Tax Sharing Agreement and not by this Section 4.5.

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### (c)                                  Forestshall, and shall cause the other Forest Indemnitees to, notify Spinco inwriting promptly after learning of any Third-Party Claim for which any ForestIndemnitee intends to seek indemnification from Spinco under thisAgreement.  Spinco shall, and shall causethe other Spinco Indemnitees to, notify Forest in writing promptly afterlearning of any Third-

 

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### Party Claim for which any Spinco Indemnitee intends toseek indemnification from Forest under this Agreement.  The failure of any Indemnitee to give suchnotice shall not relieve any Indemnifying Party of its obligations under this Section 4.5except to the extent that such Indemnifying Party is actually prejudiced bysuch failure to give notice.  Such noticeshall describe such Third-Party Claim in reasonable detail and shall indicatethe amount (estimated if necessary) of the Indemnifiable Loss that has beenclaimed against or may be sustained by such Indemnitee.

###  

### (d)                                 Exceptas otherwise provided in paragraph (e) of this Section 4.5, anIndemnifying Party may, by notice to the Indemnitee and to Forest, if Spinco isthe Indemnifying Party, or to the Indemnitee and Spinco, if Forest is theIndemnifying Party, at any time after receipt by such Indemnifying Party ofsuch Indemnitee’s notice of a Third-Party Claim, undertake (itself or throughanother member of the Group of which the Indemnifying Party is a member) thedefense or settlement of such Third-Party Claim, at such Indemnifying Party’sown expense and by counsel reasonably satisfactory to the Indemnitee.  If an Indemnifying Party undertakes thedefense of any Third-Party Claim, such Indemnifying Party shall control theinvestigation and defense or settlement thereof, and the Indemnitee may notsettle or compromise such Third-Party Claim, except that such Indemnifying Partyshall not (i) require any Indemnitee, without its prior written consent,to take or refrain from taking any action in connection with such Third-PartyClaim, or make any public statement, which such Indemnitee reasonably considersto be against its interests, or (ii) without the prior written consent ofthe Indemnitee and of Forest, if the Indemnitee is a Forest Indemnitee, or theIndemnitee and of Spinco, if the Indemnitee is a Spinco Indemnitee, consent toany settlement that does not include as a part thereof an unconditional releaseof the relevant Indemnitees from liability with respect to such Third-PartyClaim or that requires the Indemnitee or any of its Representatives orAffiliates to make any payment that is not fully indemnified under this Agreementor to be subject to any non-monetary remedy. Subject to the Indemnifying Party’s control rights, as specified herein,the Indemnitees may participate in such investigation and defense, at their ownexpense.  Following the provision ofnotices to the Indemnifying Party, until such time as an Indemnifying Party hasundertaken the defense of any Third-Party Claim as provided herein, suchIndemnitee shall control the investigation and defense or settlement thereof,without prejudice to its right to seek indemnification hereunder.

###  

### (e)                                  Ifan Indemnitee reasonably determines that there may be legal defenses availableto it that are different from or in addition to those available to itsIndemnifying Party which make it inappropriate for the Indemnifying Party toundertake the defense or settlement thereof, then such Indemnifying Party shallnot be entitled to undertake the defense or settlement of such Third-PartyClaim; and counsel for the Indemnifying Party shall be entitled to conduct thedefense of such Indemnifying Party and counsel for the Indemnitee (selected bythe Indemnitee) shall be entitled to conduct the defense of such Indemnitee, inwhich case the reasonable fees, costs and expenses of such counsel for theIndemnitee (but not more than one counsel reasonably satisfactory to theIndemnifying Party) shall be paid by such Indemnifying Party, it beingunderstood that both such counsel shall cooperate with each other to conductthe defense or settlement of such action as efficiently as possible.

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### (f)                                    Inno event shall an Indemnifying Party be liable for the fees and expenses ofmore than one counsel for all Indemnitees (in addition to local counsel and itsown counsel, if 

 

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### any) in connection with any one action, or separatebut similar or related actions, in the same jurisdiction arising out of thesame general allegations or circumstances.

###  

### (g)                                 Ifthe Indemnifying Party undertakes the defense or settlement of a Third-PartyClaim, the Indemnitee shall make available to the Indemnifying Party and itscounsel all information and documents reasonably available to it which relateto any Third-Party Claim, and otherwise cooperate as may reasonably be requiredin connection with the investigation, defense and settlement thereof, subjectto the terms and conditions of a mutually acceptable joint defense agreement.

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### (h)                                 Theamount that any Indemnifying Party is or may be required to pay to anyIndemnitee pursuant to this Section 4.5 shall be reduced (retroactively orprospectively) by any insurance proceeds or other amounts actually recoveredfrom third parties by or on behalf of such Indemnitee in respect of the relatedIndemnifiable Losses.  The existence of aclaim by an Indemnitee for insurance or against a third party in respect of anyIndemnifiable Loss shall not, however, delay or reduce any payment pursuant tothe indemnification provisions contained herein and otherwise determined to bedue and owing by an Indemnifying Party. Rather the Indemnifying Party shall make payment in full of such amountso determined to be due and owing by it and, if, and to the extent that, thereexists a claim against any third party (other than an insurer) in respect ofsuch Indemnifiable Loss, the Indemnitee shall assign such claim against suchthird party to the Indemnifying Party. Notwithstanding any other provisions of this Agreement, it is theintention of the parties hereto that no insurer or any other third party shallbe (i) entitled to a benefit it would not be entitled to receive in theabsence of the foregoing indemnification provisions or (ii) relieved ofthe responsibility to pay any claims for which it is obligated.  If an Indemnitee shall have received thepayment required by this Agreement from an Indemnifying Party in respect of anyIndemnifiable Losses and shall subsequently actually receive insurance proceedsor other amounts in respect of such Indemnifiable Losses, then such Indemniteeshall hold such insurance proceeds in trust for the benefit of such IndemnifyingParty and shall pay to such Indemnifying Party a sum equal to the amount ofsuch insurance proceeds or other amounts actually received, up to the aggregateamount of any payments received from such Indemnifying Party pursuant to thisAgreement in respect of such Indemnifiable Losses.

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### (i)                                     Theremedies provided in this Section 4.5 shall be cumulative and shall notpreclude assertion by any Indemnitee of any other rights or the seeking of anyother remedies against any Indemnifying Party. However, the procedures set forth in this Section 4.5 shall be theexclusive procedures governing any indemnity action brought under thisAgreement, except as otherwise specifically provided in any of the otherTransaction Agreements.

 

Section 4.6                                      *Survival*.  ThisAgreement shall survive the Distribution Date.

 

Section 4.7                                      *Notices*.  Any notice,demand, claim, or other communication under this Agreement shall be in writingand shall be given in accordance with the provisions for giving notice underthe Distribution Agreement.

 

Section 4.8                                      *Interpretation*.  Wordsin the singular shall be held to include the plural and vice versa and words ofone gender shall be held to include the other genders as the contextrequires.  The terms “hereof,” “herein”and “herewith” and other words of similar import shall, 

 

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unless otherwisestated, be construed to refer to this Agreement as a whole (including allschedules and any other exhibits hereto) and not to any particular provision ofthis Agreement.  The word “including” andthe words “of similar import” when used in this Agreement shall mean “including,without limitation,” unless the context otherwise requires or unless otherwisespecified.  The word “or” shall not beexclusive.

 

Section 4.9                                      *Governing Law*.  ThisAgreement shall be governed by and construed in accordance with the laws of theState of Delaware, without reference to principles of conflict of laws.

 

Section 4.10                                *No Assignment*.  ThisAgreement may not be assigned by either party (except by operation of law)without the written consent of the other, and shall bind and inure to thebenefit of the parties hereto and their respective successors and permittedassignees.

 

Section 4.11                                *Third Party Beneficiary*. The terms and provisions of this Agreement are intended solely for thebenefit of each party hereto, the Company and their respective successors orpermitted assignees, and it is not the intention of the parties to conferthird-party beneficiary rights upon any other person or entity.  For the avoidance of doubt, the parties agreethat the Company shall be a third party beneficiary of this Agreement.

 

Section 4.12                                *Amendment*.  ThisAgreement may not be amended or supplemented except by an agreement in writingsigned by Forest and Spinco, with the consent of the Company.

 

Section 4.13                                *Termination*.  In theevent the Merger Agreement is terminated prior to the consummation of thetransactions contemplated by the Merger Agreement, this Agreement shallterminate without further action by Forest or Spinco.

 

Section 4.14                                *Counterparts*.  ThisAgreement may be executed in counterparts, each of which shall be deemed anoriginal and all of which together shall constitute one and the sameinstrument.

 

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IN WITNESS WHEREOF, theparties have caused this Employee Benefits Agreement to be executed as of theday and year first above written.

 
|   | **FOREST OIL CORPORATION**   |
|--------|------------------------------|
|   |                         |
|   |                         |
|   | By:                          |   |   |
|   |                         | Name: |
|   |                         | Title: |
|   |                         |   |
|   |                         |
|   | **SML WELLHEAD CORPORATION** |
|   |                         |
|   |                         |
|   | By:                          |   |   |
|   |                         | Name: |
|   |                         | Title: |

 

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