AMENDMENT TO THE


AMENDED AND RESTATED EMPLOYMENT AGREEMENT


 


This Amendment (this "Amendment")
to the Amended and Restated Employment Agreement of Bruce N. Huff dated as of June 9, 2010 (the "Agreement") is
entered into as of January 27, 2012 by and between Far East Energy Corporation, a Nevada corporation ("Company"),
and Bruce N. Huff ("Employee").


 


WHEREAS, the Company wishes
to assure itself of the continued services of Employee as the Company's Chief Financial Officer for the period provided in this
Amendment, and Employee is willing to perform services for the Company for such period, upon the terms and conditions hereinafter
provided beginning on April 19, 2010 (the "Effective Date"); and


 


WHEREAS, the Company and
Employee desire to amend the Agreement on the terms herein provided.


 


NOW, THEREFORE, in consideration
of the mutual covenants herein contained, the parties hereto hereby agree as follows:


 


Section 1 of the
Agreement shall be amended and restated to read as follows in its entirety:


 


1.Term. The term of employment under
this Agreement shall commence and this Agreement shall commence on the Effective Date and shall continue for a period ending
on January 27, 2016, unless extended or sooner terminated in accordance with the terms hereof (the "Term").
Either the Company or Employee may terminate Employee’s employment with or without Cause or Good Reason (each as defined
below). Termination of Employee's employment shall take effect as set forth in Section 7 and, upon the termination taking effect,
Employee's right to additional compensation (other than amounts earned, accrued or owing or as otherwise set forth herein). Upon
mutual agreement of the Company and Employee, this Agreement may be extended for such period as the parties may agree.


 


Section 7(g) of
the Agreement shall be amended and restated to read as follows in its entirety:


 


(g)In order
to receive any of the payments set forth in Section 8 (except for amounts earned, accrued or owing to which Employee is already
entitled as of the date of termination), Employee must first timely execute a separation agreement and release of all claims against
the Company (other than for amounts earned, accrued or owing to which Employee is already entitled as of the date of termination)
in a form suitable to the Company; provided, however, that the Company shall provide Employee with such form on a timely basis
so that Employee is able to provide the Company with the executed separation agreement and release of claims to ensure that the
payments made pursuant to Section 8 hereto are made within the “short term deferral period” within the meaning of Section
409A of the Code and the Treasury Regulations promulgated thereunder. Notwithstanding anything contained in this Amendment to the
contrary, if Employee terminates his employment with the Company prior to the date that is the earlier of the nine (9) month anniversary
of the date of this Amendment and the consummation of any Change of Control, the terms and conditions of this Amendment shall be
void and of no legal effect, and the terms of the Agreement shall govern the Employee’s employment with the Company.



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Section 8(a) of
the Agreement shall be amended and restated to read as follows in its entirety:


(a)Death
or Disability. If Employee's employment shall be terminated by reason of death or Disability, the Company shall pay Employee
the portion of the Base Salary which would have been payable to Employee through the date his employment is terminated; plus, any
other amounts earned, accrued or owing as of the date of death or Disability of Employee but not yet paid to Employee under Section
3. In the event of the death or Disability of Employee, then any payment due under this Section 8(a) shall be made to Employee
or Employee's estate, heirs, executors, administrators, or personal or legal representatives, as the case may be. Within one (1)
year following Employee's termination of employment due to death or Disability, Employee or Employee's estate, heirs, executors,
administrators, or personal or legal representatives, as the case may be, shall be entitled to exercise all options granted to
Employee to the extent such options are vested and exercisable at the time of such termination pursuant to this Agreement or otherwise,
and all such options not exercised within such one (1) year period shall be forfeited; provided, however, that in no event shall
any option be exercisable after its original expiration date. Notwithstanding the foregoing sentence, in no event may Employee
or Employee’s estate, heirs, executors, administrators, or personal or legal representatives, as the case may be, exercise
such vested and exercisable options later than the earlier of (A) the latest date upon which the option could have expired by its
original terms under any circumstances, or (B) the 10th anniversary of the original date of grant of the option.


 


Section 8(c) of
the Agreement shall be amended and restated to read as follows in its entirety:


 


(c)Without Cause;
Good Reason; Change of Control. If Employee's employment is terminated by the Company without Cause (other than as a result
of death or Disability) or Employee terminates his employment for Good Reason:


 


(i)then Employee
shall be entitled to a lump sum payment in an amount equal to one-hundred percent (100%) of Employee's annual Base Salary in the
year in which he experiences a "Separation of Service" (as defined in Section 409A of the Code); provided that, notwithstanding
the foregoing, if Employee experiences a Separation of Service without Cause or for Good Reason on or within 24 months after a
Change of Control (as defined below), then the Company shall pay Employee a lump sum payment in an amount equal to two hundred
percent (200%) of Employee's annual Base Salary in the year of such Separation of Service;


 


(ii)Employee
shall be entitled to all amounts earned, accrued or owing through the date his employment is terminated but not yet paid to Employee
under Section 3; and


 



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(iii)Employee
shall be entitled to exercise within one (1) year after the date of termination of Employee's employment all options granted to
him to the extent vested and exercisable at the date of termination of Employee's employment; provided that in no event may Employee
exercise such vested and exercisable options later than the earlier of (A) the latest date upon which the option could have expired
by its original terms under any circumstances, and (B) the 10th anniversary of the original date of grant of the option.


 


Section 8(f)(iii)
of the Agreement shall be amended and restated to read as follows in its entirety:


 


(iii)the
(A) approval by the stockholders of the Company of a complete liquidation or dissolution of the Company or (B) sale or other
disposition (in one transaction or a series of related transactions) of more than 40% of all of the assets of the Company and its
subsidiaries on a consolidated basis, unless the successor entity existing immediately after such sale or disposition is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively,
of the Outstanding Company Voting Securities immediately prior to such sale or disposition;


 


Section 13 of the
Agreement shall be amended and restated to read as follows in its entirety:


 


13.Compliance with Section 409A.
It is the intent of this Agreement that no payment to Employee shall result in “nonqualified deferred compensation”
within the meaning of Section 409A. However, if all or a portion of the payments set forth in this Agreement meet the definition
of nonqualified deferred compensation, the Company intends that such payments be made in a manner that complies with Section 409A.
The Company shall be entitled to take reasonable steps to fulfill this intent, including, but not limited to, making any amendments
to this Agreement as may be necessary to comply with the provisions of Section 409A, in each case, without the consent of Employee.
Notwithstanding the foregoing, the Company does not make any representation that the benefits provided under this Agreement will
be exempt from Section 409A and makes no undertakings to preclude Section 409A from applying to the benefits provided under this
Agreement. In addition, a delay of payment shall not, in and of itself, constitute a violation of the deferral or distribution
requirements of Section 409A or a breach of this Agreement if, based on the Company’s reasonable understanding, such payment
would limit the ability of the Company to take a deduction under Section 162(m) of the Code; provided that payment shall be made
at the earliest date at which the Company reasonably anticipates that the deduction of the payment amount will not be limited by
application of Section 162(m) of the Code or by the end of the calendar year in which Employee terminates employment.


 


For purposes of applying
the provisions of Section 409A, each separately identified amount to which Employee is entitled shall be treated as a separate
payment. The time or schedule of any payment or amount scheduled to be paid pursuant to the terms of this Agreement may not be
accelerated except as otherwise permitted under Section 409A. Furthermore, if any payments are to be made within a specified period
of time or during a calendar year, the date of such payment shall be in the sole discretion of the Company.


 



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Payment or reimbursement
of expenses incurred by Employee pursuant to this Agreement shall be made promptly and in no event later than December 31 of the
year following the year in which such expenses were incurred, and the amount of such expenses eligible for payment or reimbursement,
or in-kind benefits provided, in any year shall not affect the amount of such expenses eligible for payment or reimbursement, or
in-kind benefits to be provided, in any other year, except for any limit on the amount of expenses that may be reimbursed under
an arrangement described in Code Section 105(b). Additionally, any right to expense reimbursement or in-kind benefits shall not
be subject to liquidation or exchange for another benefit.


 


Ratifications.  The
terms and provisions set forth in this Amendment shall modify and supersede all inconsistent terms and provisions set forth in
the Agreement.  Except as expressly modified and superseded by this Amendment, the Company and Employee each hereby (a)
ratifies and confirms the Agreement, (b) agrees that the same shall continue in full force and effect, and (c) agrees that the
same are the legal, valid and binding obligations of the Company and Employee, enforceable against the Company and Employee in
accordance with its respective terms.


 


Severability.  If,
for any reason, any provision of this Amendment is held invalid, illegal or unenforceable such invalidity, illegality or unenforceability
shall not affect any other provision of this Amendment not held so invalid, illegal or unenforceable, and each such other provision
shall, to the full extent consistent with law, continue in full force and effect.  In addition, if any provision of this
Amendment shall be held invalid, illegal or unenforceable in part, such invalidity, illegality or unenforceability shall in no
way affect the rest of such provision not held so invalid, illegal or unenforceable and the rest of such provision, together with
all other provisions of this Amendment, shall, to the full extent consistent with law, continue in full force and effect.  If
any provision or part thereof shall be held invalid, illegal or unenforceable, to the fullest extent permitted by law, a provision
or part thereof shall be substituted therefor that is valid, legal and enforceable.


 


Headings.  The
headings of Sections are included solely for convenience of reference and shall not control the meaning or interpretation of any
of the provisions of this Amendment.


 


Governing Law.  This
Amendment has been executed and delivered in the State of Texas, and its validity, interpretation, performance and enforcement,
and all disputes and controversies in connection therewith, shall be governed by the laws of the State of Texas, without giving
effect to any principles of conflicts of law that would apply any other law.


 


Withholding.  All
amounts paid pursuant to the Agreement and this Amendment shall be subject to withholding for taxes (federal, state, local or otherwise)
to the extent required by applicable law.


 



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Counterparts.  This
Amendment may be executed in counterparts, each of which, when taken together, shall constitute one original agreement.


 


Waiver.  No
term or condition of the Agreement or this Amendment shall be deemed to have been waived, nor shall there be any estoppel against
the enforcement of any provision of this Amendment or the Agreement except by written instrument of the party charged with such
waiver or estoppel.  No such written waiver shall be deemed a continuing waiver unless specifically stated therein, and
each such waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such term
or condition for the future or as to any act other than that specifically waived.


 


Entire Agreement.  The
Agreement and this Amendment, together, contain the entire understanding between the parties hereto regarding this subject except
that this Amendment shall not affect or operate to reduce any benefit or compensation inuring to Employee of a kind elsewhere provided
and not expressly provided for in the Agreement or this Amendment.


 


 


(Remainder of page intentionally left blank;
signature page follows)


 



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IN WITNESS WHEREOF, Company has caused its duly
authorized officer and directors to execute and attest to this Amendment, and Employee has placed his signature hereon, effective
as of the Effective Date.


 


	 	COMPANY:
	 	 	 
	 	FAR EAST ENERGY CORPORATION
	 	 	 
	 	 	 
	 	 	 
	 	By: 	/s/ Michael R. McElwrath
	 	Name: 	Michael R. McElwrath
	 	Title: 	Chief Executive Officer
	 	 	 
	 	 	 
	 	EMPLOYEE:
	 	 	 
	 	 	 
	 	 	 
	 	By: 	/s/ Bruce N. Huff
	 	 	Bruce N. Huff


 


 



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