Document:

Employment Agreement Michael B. Hiney

 Exhibit 10.4 
 EMPLOYMENT AGREEMENT 
 This EMPLOYMENT AGREEMENT (this
“Agreement”) is made by and between CEP Services Company, Inc., a Delaware corporation (the “Company”), Michael B. Hiney (“Executive”) and, solely for the limited purpose set out in
Section 7.13 of this Agreement, Constellation Energy Partners LLC, a Delaware limited liability company (“CEP”). 
 WHEREAS, the Company is a wholly owned subsidiary of CEP; 
 WHEREAS, pursuant to
an offer letter by and between the Company and Executive, dated December 31, 2008 (the “Offer Letter”), Executive is employed by the Company as Chief Accounting Officer and Controller and serves in those same offices for CEP,
as directed by the Company; and 
 WHEREAS, the Company and Executive desire to provide the full terms and conditions of
Executive’s employment by the Company; 
 WHEREAS, the Company has caused CEP to enter into each of the 2009 LTI Grant
Agreement (defined below) and Inducement Award Agreement (defined below) contemporaneously with the execution of this Agreement; 
 WHEREAS, the Company, CEP and Executive intend for the Offer Letter to be fully superseded by the entry into each of this Agreement, the 2009 LTI Grant Agreement and the Inducement Award Agreement; 
 NOW, THEREFORE, for and in consideration of the mutual promises, covenants and obligations contained herein, the Company and Executive agree
as follows: 
 ARTICLE 1 
 DEFINITIONS AND INTERPRETATIONS 
 1.1 Definitions. 
 (a) “2009 LTI Grant Agreement” means that certain Grant Agreement Relating to Notional Units - Executives,
dated May 1, 2009, by and between CEP and Executive. 
 (b) “Affiliate” means, with respect
to any natural person, firm, partnership, association, corporation, limited liability company, company, trust, entity, public body or government (a “Person”), any Person that, directly or indirectly, controls, is controlled by, or
is under common control with, such Person. The term “control” (including the terms “controlled by” and “under common control with”) as used in this definition means the possession, directly or
indirectly, of the power to direct or cause the direction of management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. With respect to any natural person, the term “Affiliate”
means (i) the spouse or children (including those by adoption) and siblings of such Person; and any trust whose primary beneficiary is such Person, such Person’s spouse, such Person’s siblings and/or one or more of such Person’s
lineal descendants,

 
(ii) the legal representative or guardian of such Person or of any such immediate family member in the event such Person or any such immediate family member becomes mentally incompetent and
(iii) any Person controlled by or under common control with any one or more of such Person and the Persons described in clauses (i) or (ii) preceding. 
 (c) “Annual Base Salary” means, as of a specified date, Executive’s annual base salary as of such date
determined pursuant to Section 4.1. 
 (d) “Annual Compensation” means, as of
particular date, an amount equal to: 
 (i) the Target-Level Bonus for the year in which such date falls; plus

 (ii) the greater of: 
 (A) Executive’s Annual Base Salary at the annual rate in effect on the date of his Involuntary Termination; 

(B) Executive’s Annual Base Salary at the annual rate in effect 180 days prior to the date of his Involuntary
Termination; and 
 (C) Executive’s Annual Base Salary at the annual rate in effect immediately prior to a
Change of Control if Executive’s employment shall be subject to an Involuntary Termination during the Change of Control Period. 
 (e) “Board” means the Board of Managers of CEP. 
 (f) “Cause” means Executive 
 (i) has engaged in gross negligence, gross incompetence
or willful misconduct in the performance of his duties, 
 (ii) has failed to substantially perform the duties
and services reasonably required by the Company; provided, that such failure continues for at least 30 days after Executive’s receipt of written notice of such failure from the Company, 
 (iii) has willfully engaged in conduct that is materially injurious to CEP or its subsidiaries (monetarily or otherwise),

 (iv) has committed an act of fraud, embezzlement or willful breach of a fiduciary duty to the Company or CEP
(including the unauthorized disclosure of confidential or proprietary material information of the Company or CEP) or 
 (v) has been convicted of, pled guilty to, or pleaded no contest to, a crime involving fraud, dishonesty or moral turpitude. 
  

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 For purposes of this definition, “moral turpitude” means an act of baseness,
vileness or depravity in the private and social duties which one owes to his fellow man. 
 (g)
“CEG” means Constellation Energy Group, Inc., a Maryland corporation. 
 (h) “CEG
Acquisition” means the consummation of a reorganization, merger, consolidation, statutory equity exchange or similar form of business transaction involving CEG (a “CEG Business Combination”), unless immediately following
such CEG Business Combination: (i) more than 60% of the total voting power of (x) the organization resulting from such CEG Business Combination (the “CEG Surviving Organization”), or (y) if applicable, the ultimate
parent organization that directly or indirectly has beneficial ownership of at least 95% of the voting securities eligible to elect managers or directors of the CEG Surviving Organization (the “CEG Parent Organization”), is
represented by combined voting power of CEG’s then outstanding securities eligible to vote for the election of the CEG Board (the “CEG Voting Securities”) that were outstanding immediately prior to such CEG Business Combination
(or, if applicable, is represented by equity interests into which such CEG Voting Securities were converted pursuant to such CEG Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the
voting power of such CEG Voting Securities among the holders thereof immediately prior to the CEG Business Combination, (ii) no person (other than any employee benefit plan (or related trust) sponsored or maintained by the CEG Surviving
Organization or the CEG Parent Organization), is or becomes the beneficial owner, directly or indirectly, of 25% or more (the “CEG Percentage”) of the total voting power of the outstanding voting securities eligible to elect
managers or directors of the CEG Parent Organization (or, if there is no CEG Parent Organization, the CEG Surviving Organization) except where such person held the CEG Percentage of CEG Voting Securities immediately prior to the consummation of the
CEG Business Combination and (iii) at least a majority of the members of the board of managers or directors of the CEG Parent Organization (or, if there is no CEG Parent Organization, the CEG Surviving Organization) following the consummation
of the CEG Business Combination were members of the CEG Board at the time of the CEG Board’s approval of the execution of the initial agreement providing for such CEG Business Combination. 
 (i) “CEG Board” means the Board of Directors of CEG. 
 (j) “CEG Ownership Event” means the consummation of any transaction or other event whereby CEG or any of its
Affiliates becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 49% or more of CEP’s then-outstanding Common Units. 
 (k) “Change of Control” shall be deemed to have occurred upon any one or more of the following events:

 (i) Board Change. 
  

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 (A) During any period of 24 consecutive months, individuals who, at the
commencement of such period, constitute all of the Class B Managers (the “Incumbent Class B Managers”) cease for any reason to constitute at least a majority of the Class B Managers; provided, however, that any person
becoming a Class B Manager subsequent to the commencement of such period, whose election or nomination for election was approved by a vote of at least two Incumbent Class B Managers then on the Board (either by a specific vote or by approval of the
proxy statement of CEP in which such person is named as a nominee for Class B Manager, without written objection to such nomination) shall be an Incumbent Class B Manager; provided further, however, that no individual initially
elected or nominated as a Class B Manager of CEP as a result of an actual or threatened election contest with respect to Managers or as a result of any other actual or threatened solicitation of proxies by or on behalf of any person other than the
Board shall be deemed to be an Incumbent Class B Manager; or 
 (B) Excluding the circumstances described in
Section 1.1(k)(i)(C), during any period of 24 consecutive months, individuals who, at the commencement of such period, constitute the Board (each, an “Incumbent Board Member”) cease for any reason to constitute at least
a majority of the Board; provided, however, that any person becoming a Class B Manager subsequent to the commencement of such period, whose election or nomination for election was approved by a vote of at least two Incumbent Class B
Managers then on the Board (either by a specific vote or by approval of the proxy statement of CEP in which such person is named as a nominee for Class B Manager, without written objection to such nomination) shall be an Incumbent Board Member;
provided further, however, that no individual initially elected or nominated as a Class B Manager of CEP as a result of an actual or threatened election contest with respect to Managers or as a result of any other actual or
threatened solicitation of proxies by or on behalf of any person other than the Board shall be deemed to be an Incumbent Class B Manager; or 
 (C) During the period of 24 consecutive months immediately following the occurrence of a Class A Event, individuals who, at the commencement of such period, constitute the Class A Managers and
at least one Class B Manager cease for any reason to serve CEP in such capacities, whether by removal, resignation or otherwise; 
 (ii) Unit Acquisition. Any “person” (as such term is defined in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of CEP representing 25% or more of the combined voting power of CEP’s then outstanding securities eligible to vote for the
election of the Board (the “CEP Voting Securities”); provided, however, that none of CEG or its Affiliates shall be

  

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deemed such a person unless CEG or any of its Affiliates shall after the date of this Agreement become the beneficial owner, directly or indirectly, of CEP Voting Securities representing 33 1/3% or more of the CEP Voting Securities then
outstanding; and provided further, however, that, except with respect to CEG or any of its Affiliates, the event described in this paragraph (ii) shall not be deemed to be a change in control by virtue of any of the following
acquisitions (A) by CEP or any organization with respect to which CEP owns a majority of the outstanding equity interest or has the power to vote or direct the voting of sufficient securities to elect a majority of the Managers (or equivalent)
(a “Subsidiary Company”), (B) by any employee benefit plan (or related trust) sponsored or maintained by CEP or any Subsidiary Company, (C) by any underwriter temporarily holding securities pursuant to an offering of such
securities, (D) pursuant to a Non-Qualifying Transaction (as defined in paragraph (iii)), or (E) pursuant to any acquisition by Executive or any group of persons including Executive (or any entity controlled by Executive or any group of
persons including Executive); 
 (iii) Business Combination. Consummation of a reorganization,
merger, consolidation, statutory equity exchange or similar form of business transaction involving CEP or any Subsidiary Company (a “Business Combination”), unless immediately following such Business Combination: (A) more than
60% of the total voting power of (x) the organization resulting from such Business Combination (the “Surviving Organization”), or (y) if applicable, the ultimate parent organization that directly or indirectly has
beneficial ownership of at least 95% of the voting securities eligible to elect managers or directors of the Surviving Organization (the “Parent Organization”), is represented by CEP Voting Securities that were outstanding
immediately prior to such Business Combination (or, if applicable, is represented by equity interests into which such CEP Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such CEP Voting Securities among the holders thereof immediately prior to the Business Combination, (B) no person (other than any employee benefit plan (or related trust) sponsored or
maintained by the Surviving Organization or the Parent Organization), is or becomes the beneficial owner, directly or indirectly, of 25% or more (the “Applicable Percentage”) of the total voting power of the outstanding voting
securities eligible to elect managers or directors of the Parent Organization (or, if there is no Parent Organization, the Surviving Organization) except where such person held the Applicable Percentage of CEP Voting Securities immediately prior to
the consummation of the Business Combination and (C) at least a majority of the members of the board of managers or directors of the Parent Organization (or, if there is no Parent Organization, the Surviving Organization) following the
consummation of the Business Combination were Managers at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination (any Business Combination that satisfies all of the criteria specified
in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying Transaction”); 
  

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 (iv) Liquidation. The equity holders of CEP approve a plan of
complete liquidation or dissolution of CEP; or 
 (v) Asset Sale. The consummation of a sale or
disposition by CEP of all or substantially all of CEP’s assets, other than a sale or disposition where the holders of CEP Voting Securities outstanding immediately prior thereto hold securities immediately thereafter that represent more than
60% of the combined voting power of the voting securities of the acquiror, or parent of the acquiror, of such assets. 
 Notwithstanding the foregoing, except with respect to CEG or any of its Affiliates, a change in control of CEP shall not be deemed to occur solely because any person acquires beneficial ownership of more than 25% of CEP Voting Securities as
a result of the acquisition of CEP Voting Securities by CEP that reduces the number of CEP Voting Securities outstanding; provided, however, that if after such acquisition by CEP such person becomes the beneficial owner of additional
CEP Voting Securities that increases the percentage of outstanding CEP Voting Securities beneficially owned by such person, a change in control of CEP shall then occur. 
 (l) “Class A Event” means the occurrence of any event through which or as a consequence of which
(i) CEG shall cease to beneficially own, directly or indirectly, at least 50% of the Class A Units of CEP that are then outstanding (including where CEG or any of its direct or indirect subsidiaries (individually, a “CEG
Entity”) enters into a total return swap or any other contractual arrangement whereby a CEG Entity transfers any economic interest in at least 50% of the Class A Units of CEP that are then outstanding); (ii) a CEG Acquisition
occurs; or (iii) CEG shall cease to have the right, directly or indirectly, to direct the appointment of all Class A Managers pursuant to Section 11.8(d) of the LLC Agreement or otherwise (including where any CEG Entity enters into
any contractual arrangement whereby a CEG Entity grants any Person other than a wholly owned CEG Entity the right or option, directly or indirectly, to direct the appointment of any number of the Class A Managers pursuant to
Section 11.8(d) of the LLC Agreement or otherwise). 
 (m) “Change of Control Period”
means, with respect to a Change of Control, the two-year period beginning on the date upon which such Change of Control occurs. 
 (n) “Code” means the Internal Revenue Code of 1986, as amended. 
 (o) “Compensation Committee” means the Compensation Committee of the Board. 
 (p) “Disability” means that, as a result of Executive’s incapacity due to physical or mental illness, (i) he shall have been absent from the full-time performance of his duties
for six consecutive months, (ii) the Board reasonably determines that such incapacity is expected to be suffered for a period of at least 12 consecutive months from the date such absence first occurred and (iii) he shall not have returned
to full-time

  

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performance of his duties within 30 days after written notice of disability is given to Executive or his representative by the Company (a “Disability Notice”); provided,
however, that such Disability Notice may not be given prior to 30 days before the expiration of such six-month period. 
 (q) “Effective Date” means May 1, 2009. 
 (r)
“Enhanced Severance Amount” means an amount equal to two times Executive’s Annual Compensation. 
 (s) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 (t)
“Event of Good Reason” means: 
 (i) The occurrence, prior to a Change of Control or after the
expiration of a Change of Control Period, of any one or more of the following: 
 (A) a material reduction in
the nature or scope of Executive’s authority or duties from those previously applicable to him; provided, however, that, if Executive holds more than one office, the removal from any offices other than the most senior shall not
constitute an Event of Good Reason; 
 (B) a reduction in Executive’s Annual Base Salary, except with
Executive’s prior written consent; 
 (C) a diminution in Executive’s eligibility to participate in
bonus, stock option, incentive award and other compensation plans that provide opportunities to receive compensation that are substantially similar to the opportunities provided by CEP or the Company to executives with comparable duties (subject, in
each case to CEP and Executive performance, as applicable); 
 (D) a change in the location of Executive’s
principal place of employment by the Company by more than 60 miles from the location where he was principally employed; provided, however, that such change in the location of Executive’s principal place of employment shall not
constitute an Event of Good Reason if Executive consents to such decision to relocate prior to such change in location. 
 (ii) The occurrence, within a Change of Control Period, of any one or more of the following (except with Executive’s prior written consent): 
 (A) a material reduction in the nature or scope of Executive’s authority or duties from those applicable to him immediately prior to the date on which a Change of Control occurs; 
  

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 (B) a reduction in Executive’s Annual Base Salary from that provided
to him immediately prior to the date on which a Change of Control occurs; 
 (C) a diminution in
Executive’s eligibility to participate in bonus, stock option, incentive award and other compensation plans that provide opportunities to receive compensation that are the greater of (A) the opportunities provided by CEP or the Company and
any of its subsidiaries for executives with comparable duties or (B) the opportunities under any such plans under which he was participating immediately prior to the date on which a Change of Control occurs; 
 (D) a material diminution in employee benefits (including medical, dental, life insurance and long-term disability plans)
and perquisites applicable to Executive from the greater of (A) the employee benefits and perquisites provided by CEP or the Company and any of its subsidiaries to executives with comparable duties or (B) the employee benefits and
perquisites to which Executive was entitled immediately prior to the date on which a Change of Control occurs; or 
 (E) a change in the location of Executive’s principal place of employment by the Company by more than 60 miles from the location where he was principally employed immediately prior to the date on which a Change of Control occurs;
provided, however, that such change in the location of Executive’s principal place of employment shall not constitute an Event of Good Reason if Executive consents to the decision to relocate prior to such change in location.

 (u) “Inducement Award Agreement” means that certain Inducement Award Agreement, dated
May 1, 2009, by and between CEP and Executive. 
 (v) “Involuntary Termination” means any
termination of Executive’s employment with the Company that: 
 (i) does not result from a resignation by
Executive (other than a resignation pursuant to clause (ii) of this Section 1.1(v)); 
 (ii)
results from the Company’s delivery of a notice pursuant to Section 3.1 that no automatic extension shall occur upon the Initial Expiration Date; or 
 (iii) results from a resignation by Executive on or before the date that is 60 days after the occurrence of an Event of Good
Reason; 
 provided, however, that the term “Involuntary Termination” shall not include a
termination for Cause or any termination as a result of death or Disability. 
  

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 (w) “LLC Agreement” means the Second Amended and Restated
Operating Agreement of Constellation Energy Partners LLC, dated as of November 20, 2006, as amended, and as may be further amended from time to time. 
 (x) “Manager” means a member of the Board. 
 (y)
“Omnibus Incentive Plan” means (i) Constellation Energy Partners LLC Long-Term Incentive Plan, (ii) the Constellation Energy Partners LLC 2009 Omnibus Incentive Plan and (iii) any successor plan adopted by CEP or any
of its Affiliates for the benefit of the employees of CEP or any of its Affiliates. 
 (z) “Performance
Award” has the meaning given such term in the Omnibus Incentive Plan. 
 (aa) “Severance
Amount” means an amount equal to one and one-half times Executive’s Annual Compensation; provided, however, that, at any time after December 31, 2009, such amount shall include a Target-Level Bonus only if a bonus
was paid to or earned by Executive for the most recently completed fiscal year of CEP. 
 (bb) “Severance
Period” means the period commencing on the date of Involuntary Termination and continuing for 12 months thereafter. 
 (cc) “Special Termination Option” means Executive’s right to terminate his employment hereunder within one year of the first occurrence of a CEG Ownership Event. 
 (dd) “Target-Based Grant” means an award under the Omnibus Incentive Plan for which eligibility or pay-out
is determined by reference to the achievement of a Performance Goal, as such term is defined in the Omnibus Incentive Plan. 
 (ee) “Target-Level Bonus” means that bonus required or indicated under a Performance Award or other Target-Based Grant under the Omnibus Incentive Plan or other bonus arrangement of CEP
or the Company, in each case as if all target performance goals were achieved. 
 1.2 Interpretations. 
 (a) General. In this Agreement, unless a clear contrary intention appears, (a) the words “herein,”
“hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision, (b) reference to any Article or Section means such Article
or Section hereof, (c) the words “including” (and with correlative meaning “include”) means including, without limiting the generality of any description preceding such term and (d) where any provision of this Agreement
refers to action to be taken by either party, or that such party is prohibited from taking an action, such provision shall be applicable whether such action is taken directly or indirectly by such party. 
  

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 (b) Comparable Positions. For purposes of this Agreement, the offices
of chief financial officer or general counsel shall be deemed to have comparable duties to those of Executive. 
 ARTICLE 2

 EMPLOYMENT AND DUTIES 
 2.1 Employment. Effective as of the Effective Date and continuing for the period of time set forth in Section 3.1 of this Agreement (the “Term”), Executive’s
employment by the Company shall be subject to the terms and conditions of this Agreement. 
 2.2 Positions. From and
after the Effective Date during the Term, the Company shall employ Executive in the position of Chief Accounting Officer and Controller of CEP and Chief Accounting Officer and Controller of the Company. 
 2.3 Duties and Services. Executive agrees to serve in the position(s) referred to in Section 2.2 and to perform
diligently the duties and services appertaining to such offices, as well as such additional duties and services appropriate to such offices that CEP or the Company may reasonably designate from time to time. Executive’s employment shall also be
subject to the policies maintained and established by CEP or the Company that are of general applicability to CEP’s or the Company’s employees, as such policies may be amended from time to time. 
 2.4 Other Interests. Executive agrees, during the period of such employment by the Company, to devote substantially all of
Executive’s business time, energy and efforts to the business and affairs of CEP and the Company. 
 2.5 Duty of
Loyalty. Executive acknowledges and agrees that Executive owes a fiduciary duty of loyalty to act at all times in the best interests of CEP and the Company. In keeping with such duty, Executive shall make full disclosure to CEP and the Company
of all business opportunities pertaining to CEP’s or the Company’s businesses and shall not appropriate for Executive’s own benefit business opportunities concerning CEP’s or the Company’s businesses. 
 2.6 Disclosure Representation. Executive represents to the Company that no event of the type referred to in
Section 1.1(f)(v) has occurred with respect to Executive other than as has been disclosed to the Board. 
 ARTICLE
3 
 TERM AND TERMINATION OF EMPLOYMENT 
 3.1 Term. Unless Executive’s employment hereunder is sooner terminated pursuant to other provisions hereof, the Company agrees to employ Executive for the period beginning on the Effective
Date and ending on the third anniversary of the Effective Date (the “Initial Expiration Date”); provided, however, that beginning on the Initial Expiration Date, and on each anniversary of the Initial Expiration Date
thereafter, if Executive’s employment hereunder has not been terminated pursuant to Section 3.2 or Section 3.3, then said term of employment shall automatically be extended for an additional one-year period unless on or
before the date that is 180 days prior to the Initial Expiration Date or any anniversary thereof either party shall give written notice to the other that no such automatic extension shall occur. 
  

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 3.2 The Company’s Right To Terminate. Notwithstanding the provisions of
Section 3.1, the Company shall have the right to terminate Executive’s employment under this Agreement at any time for any of the following reasons: 
 (a) upon Executive’s death; 
 (b) upon Executive’s Disability; 
 (c) for Cause; or 
 (d) for any other reason whatsoever, in the sole discretion of the Board. 
 3.3
Executive’s Right To Terminate. Notwithstanding the provisions of Section 3.1, Executive shall have the right to terminate his employment under this Agreement for any of the following reasons: 
 (a) as a result of an Event of Good Reason; provided, however, that prior to Executive’s termination as a
result of an Event of Good Reason, Executive must give written notice to the Company of the specific occurrence that resulted in the Event of Good Reason and such occurrence must remain uncorrected for 30 calendar days following such written notice;
or 
 (b) at any time for any other reason whatsoever, in the sole discretion of Executive. 
 3.4 Notice of Termination. If the Company desires to terminate Executive’s employment hereunder at any time prior to expiration
of the Term, it shall do so by giving written notice to Executive that it has elected to terminate Executive’s employment hereunder and stating the effective date and reason for such termination; provided, however, that no such
action shall alter or amend any other provisions of this Agreement or rights arising under this Agreement. If Executive desires to terminate his employment hereunder at any time prior to expiration of the Term, he shall do so by giving a 60-day
written notice to the Company that he has elected to terminate his employment hereunder and stating the effective date and reason for such termination; provided, however, that no such action shall alter or amend any other provisions of
this Agreement or rights arising under this Agreement. 
 3.5 Deemed Resignations. Any termination of Executive’s
employment shall constitute an automatic resignation of Executive as an officer and manager or director, as applicable, (if applicable) of CEP, the Company and each of its Affiliates, unless Executive owns at least 10% of the issued and
outstanding CEP Voting Securities, in which case such resignation shall not be deemed an automatic resignation of Executive from the Board, and from the board of directors or similar governing body of any corporation, limited liability company or
other entity in which CEP holds an equity interest and with respect to which board or similar governing body Executive serves as CEP’s designee or other representative. 
  

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 ARTICLE 4 
 COMPENSATION AND BENEFITS 
 4.1 Base Salary. During the Term,
Executive shall receive an initial Annual Base Salary of $175,000. Executive’s Annual Base Salary shall be reviewed by the Compensation Committee on an annual basis, and, in the sole discretion of the Compensation Committee, such Annual Base
Salary may be increased, effective as of any date determined by the Compensation Committee. Executive’s Annual Base Salary shall be paid in equal installments in accordance with the Company’s standard policy regarding payment of
compensation to executives but no less frequently than monthly. 
 4.2 Bonuses. 
 (a) General. During the Term, the Company shall cause CEP to make yearly grants to Executive of a Performance Award
under the Omnibus Incentive Plan; provided, however, that all determinations relating to Executive’s participation, including those relating to the performance goals applicable to Executive and Executive’s level of
participation and payout opportunity, shall be made by the Compensation Committee in its sole discretion. 
 (b)
2009 Award. The Company shall cause CEP to grant Executive a Performance Award for 2009 with such Performance Metrics (as such term is defined in the Omnibus Incentive Plan) determined by the Committee in its good faith discretion (the
“2009 Award”). The 2009 Award shall pay in cash 40% of Executive’s initial Annual Base Salary for the achievement of Target-Level Performance and up to 80% of Executive’s initial Annual Base Salary for superior
performance, in each case as such performance is determined by the Committee in its good faith discretion; provided, however, that, if the Constellation Energy Partners LLC 2009 Omnibus Incentive Compensation Plan has not been approved
by the common unitholders of the Company prior to December 31, 2009, the Company shall pay Executive an amount in cash that is equivalent to the amount that would have been payable in respect of the 2009 Award, which payment shall be made
contemporaneously with the payment by the Company of bonuses to its other employees, but in no event later than March 31, 2010. 
 (c) Inducement Bonus. The Company shall pay Executive an aggregate cash bonus of $262,500 (the “Inducement Cash Bonus”), $131,250 of which is payable on January 1, 2010 and
$131,250 of which is payable on January 1, 2011. 
 4.3 Long-Term Incentive. During the Term, the Company shall
cause CEP to make yearly long-term incentive grants to Executive under the Omnibus Incentive Plan; provided, however, that all determinations relating to Executive’s participation, including those relating to the performance goals
applicable to Executive and Executive’s level of participation and payout opportunity, shall be made by the Compensation Committee in its sole discretion. 
 4.4 Life Insurance. To the extent such insurance is available to the Company on commercially reasonable terms, the Company shall obtain, and thereafter maintain at all times prior to the
termination of Executive’s employment hereunder pursuant to Article 3, a term life

  

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insurance policy with a responsible and reputable insurance company on the life of Executive, in the face amount equal to Executive’s then-current Annual Base Salary, which policy shall name
any party designated by Executive as the beneficiary thereunder. 
 4.5 Other Perquisites. During Executive’s
employment hereunder, Executive shall be afforded the following benefits as incidences of his employment: 
 (a)
Business and Entertainment Expenses. Subject to the Company’s standard policies and procedures with respect to expense reimbursement as applied to its employees generally, the Company shall no less frequently than monthly reimburse
Executive for, or pay on behalf of Executive, reasonable and appropriate expenses incurred by Executive for business related purposes, including dues and fees to industry and professional organizations and costs of entertainment and business
development. 
 (b) Vacation. During his employment hereunder, Executive shall be entitled each calendar
year to such number of days of paid vacation and to all holidays, in each case as provided to employees of the Company generally. 
 (c) Other Company Benefits. Executive and, to the extent applicable, Executive’s spouse, dependents and beneficiaries, shall be allowed to participate in all benefits, plans and programs,
including improvements or modifications of the same, that are now, or may hereafter be, available to other executives or employees of the Company. Such benefits, plans and programs shall include any profit sharing plan, thrift plan, health insurance
or health care plan, life insurance, disability insurance, pension plan, supplemental retirement plan, vacation and sick leave plan, and the like that may be maintained by the Company. The Company shall not, however, by reason of this paragraph be
obligated to institute, maintain or refrain from changing, amending or discontinuing any such benefit plan or program, as long as such changes are similarly applicable to employees generally. 
 ARTICLE 5 
 EFFECT OF TERMINATION ON 

COMPENSATION; ADDITIONAL PAYMENTS 
 5.1 Termination Other Than an Involuntary Termination. 
 (a)
Except as provided in Section 5.1(b), if Executive’s employment hereunder shall terminate upon expiration of the Term because either party has provided the notice contemplated in Section 3.1 or for any other reason
except those described in Section 5.2 and Section 5.3, then all compensation and all benefits to Executive under this Agreement shall continue to be provided until the date of such termination of employment, and such
compensation and benefits shall terminate contemporaneously with such termination of employment. 
 (b) If
Executive shall die or the Company shall have delivered a Disability Notice, then all compensation and all benefits to Executive under this Agreement shall continue to be provided until the date of such death or the date on which the Disability
Notice is delivered; provided, however, that (i) the award of Restricted Units made

  

 13 

 
pursuant to the Inducement Award Agreement and all awards under the Omnibus Incentive Plan (including the award made pursuant to the 2009 LTI Grant Agreement) shall immediately accelerate, if
then unvested, and vest in Executive or the legal representative of his estate and the Company shall pay to Executive of the legal representative of his estate any part of the Inducement Cash Bonus not already paid to Executive; and (ii) for
the year in which Executive’s death or the Company’s delivery of a Disability Notice, as applicable, occurs, the Company shall pay to Executive or the legal representative of his estate the applicable Target-Level Bonus, pro rated for the
number of days elapsed in such year at the time of such death or delivery, as applicable. 
 5.2 Involuntary Termination
Other Than During a Change of Control Period. If Executive’s employment hereunder shall be subject to an Involuntary Termination that occurs prior to a Change of Control or after the expiration of a Change of Control Period, then the
Company shall, subject to Section 5.7, pay to Executive, as additional compensation for services rendered to the Company (including CEP and its subsidiaries), the following amounts and take the following actions after the last day of
Executive’s employment with the Company: 
 (a) Pay Executive a lump-sum cash payment in an amount equal to
the Severance Amount plus any part of the Inducement Cash Bonus not already paid to Executive, which lump-sum cash payment shall be made on the first day the timing of which would not cause any part of the Severance Amount or such part of the
Inducement Cash Bonus to be subject to additional taxes or interest under Section 409A of the Code. 
 (b)
Cause (i) the Restricted Units and related Distribution Credits granted pursuant to the Inducement Award Agreement and (ii) any and all outstanding options and other non-vested service-based awards under the Omnibus Incentive Plan
(including the Notional Units and related Distribution Credits granted pursuant to the 2009 LTI Grant Agreement), that are held by Executive, to become immediately vested, earned and exercisable in full and cause Executive’s accrued benefits
under any and all nonqualified deferred compensation plans sponsored by CEP or the Company to become immediately nonforfeitable. 
 (c) Cause Executive and those of his dependents (including Executive’s spouse) who were covered under the Company’s medical and dental benefit plans on the day prior to Executive’s
Involuntary Termination to continue to be covered under such plans (or to receive equivalent benefits) throughout the Severance Period at no greater cost to Executive than that applicable to a similarly situated Company employee who has not
terminated employment; provided, however, that 
 (i) such coverage shall terminate if and to the
extent Executive becomes eligible to receive medical and dental coverage from a subsequent employer (and any such eligibility shall be promptly reported to the Company by Executive), 
 (ii) if Executive (and/or Executive’s spouse) would have been entitled to retiree medical and/or dental coverage under
the Company’s plans had Executive voluntarily retired on the date of such Involuntary Termination, then such coverages shall be continued as provided under such plans, and 
  

 14 

 (iii) such coverage to Executive (or the receipt of equivalent benefits)
shall be provided under one or more insurance policies so that reimbursement or payment of benefits to Executive thereunder shall not result in taxable income to Executive (or, if any such reimbursement or payment of benefits is taxable to
Executive, then the Company shall pay to Executive an amount (the “tax gross-up payment”) equal to an amount as is required to hold Executive harmless from any additional tax liability (including liability under Section 409A of
the Code) relating to such reimbursement or payment). Any such tax gross-up payment shall be made as soon as practicable after Executive remits the taxes, but in all events within 30 days of such remittance. 
 The Company shall pay any premiums arising from such coverage on a monthly basis. 
 5.3 Involuntary Termination During a Change of Control Period; Special Termination Option. If (X) Executive’s employment
hereunder shall be subject to an Involuntary Termination (i) following a Change of Control and (ii) during a Change of Control Period or (Y) Executive shall have delivered notice to the Company of his exercise of the Special
Termination Option within one year following the first occurrence of a CEG Ownership Event, then the Company shall, subject to Section 5.7, pay to Executive, as additional compensation for services rendered to the Company (including CEP
and its subsidiaries), the following amounts and take the following actions after the last day of Executive’s employment with the Company: 
 (a) Pay Executive a lump-sum cash payment in an amount equal to the Enhanced Severance Amount plus any part of the Inducement Cash Bonus not already paid to Executive, which lump-sum cash payment shall be
made on the first day the timing of which would not cause any part of the Enhanced Severance Amount or such part of the Inducement Cash Bonus to be subject to additional taxes or interest under Section 409A of the Code. 
 (b) Pay Executive a lump-sum cash payment in respect of the Performance Award under the Omnibus Incentive Plan for the
then-current year, which amount (the “Current-Year PA Payment”) shall be paid out as if Target-Level Performance will have been achieved for such year; provided, however, that the Current-Year PA Payment shall be
prorated based on the number of whole or partial months that have occurred as of the date of such Involuntary Termination. The Current-Year PA Payment shall be made on the first day the timing of which would not cause any part of such payment to be
subject to additional taxes or interest under Section 409A of the Code. 
 (c) Pay Executive a lump-sum cash
payment under the Omnibus Incentive Plan for any Target-Based Grants for the then-current year (not including any Performance Awards), which amount (the “Other TBG Payment”) shall be paid out as if Target-Level Performance will be
achieved for such year; provided, however, that the Other TBG Payment shall be prorated based on the number of whole or partial months that have occurred as of the date of such Involuntary Termination. The Other TBG

  

 15 

 
Payment shall be made on the first day the timing of which would not cause any part of such payment to be subject to additional taxes or interest under Section 409A of the Code. 

(d) Cause (i) the Restricted Units and related Distribution Credits granted pursuant to the Inducement Award
Agreement and (ii) any and all outstanding options and other non-vested service-based awards under the Omnibus Incentive Plan (including the Notional Units and related Distribution Credits granted pursuant to the 2009 LTI Grant Agreement), that
are held by Executive, to become immediately vested, earned and exercisable in full and cause Executive’s accrued benefits under any and all nonqualified deferred compensation plans sponsored by CEP or the Company to become immediately
nonforfeitable. 
 (e) Cause Executive and those of his dependents (including Executive’s spouse) who were
covered under the Company’s medical and dental benefit plans on the day prior to Executive’s Involuntary Termination to continue to be covered under such plans (or to receive equivalent benefits) throughout the Severance Period at no
greater cost to Executive than that applicable to a similarly situated Company employee who has not terminated employment; provided, however, that 
 (i) such coverage shall terminate if and to the extent Executive becomes eligible to receive medical and dental coverage from
a subsequent employer (and any such eligibility shall be promptly reported to the Company by Executive), 
 (ii)
if Executive (and/or Executive’s spouse) would have been entitled to retiree medical and/or dental coverage under the Company’s plans had Executive voluntarily retired on the date of such Involuntary Termination, then such coverages shall
be continued as provided under such plans, and 
 (iii) such coverage to Executive (or the receipt of equivalent
benefits) shall be provided under one or more insurance policies so that reimbursement or payment of benefits to Executive thereunder shall not result in taxable income to Executive. 
 The Company shall pay any premiums arising from such coverage on a monthly basis. 
 (f) Should any amount paid or benefit delivered pursuant to this Section 5.3 result in an excise tax payable by
Executive, the Company shall pay to Executive an amount (the “tax gross-up payment”) as is required to hold Executive harmless from such excise tax and any additional tax liability arising as a result of any part of the tax gross-up
payment. Any such tax gross-up payment shall be made as soon as practicable after Executive remits the taxes, but in all events within 30 days of such remittance. 
 5.4 Interest on Late Payments. If any payment provided for in Section 5.1, Section 5.2 or Section 5.3 hereof is not made when due, then the Company shall pay to
Executive interest on the amount payable from the date that such payment should have been made under such Section until such payment is made, which interest shall be calculated, on a

  

 16 

 
per-annum basis, at 2% plus the prime or base rate of interest as reported from time to time in the Wall Street Journal, and shall further hold Executive harmless from any liability under
Section 409A of the Code. 
 5.5 Liquidated Damages. In light of the difficulties in estimating the damages for an
early termination of Executive’s employment under this Agreement, the Company and Executive hereby agree that the payments, if any, to be received by Executive pursuant to this Article 5 shall be received by Executive as liquidated
damages. 
 5.6 Other Benefits. This Agreement governs the rights and obligations of Executive and the Company with
respect to Executive’s base salary and certain perquisites of employment. Except as expressly provided herein, Executive’s rights and obligations both during the term of his employment and thereafter with respect to unit options,
restricted units, incentive and deferred compensation, life insurance policies insuring the life of Executive and other benefits under the plans and programs maintained by the Company shall be governed by the separate agreements, plans and other
documents and instruments governing such matters. 
 5.7 Release. As a condition to the Company’s obligations
arising under Section 5.2 and Section 5.3, Executive shall first execute and deliver to the Company a release, in the form reasonably established by the Compensation Committee, releasing the Company, CEP and their respective
Affiliates, officers, managers, directors, employees and agents, from any and all claims and from any and all causes of action of any kind or character, including all claims and causes of action arising out of Executive’s employment hereunder
or the termination of such employment. The performance of the Company’s obligations under Section 5.2 and Section 5.3 and the receipt of the severance benefits provided thereunder by Executive shall constitute full
settlement of all such claims and causes of action. Executive shall not be under any duty or obligation to seek or accept other employment following a termination of employment pursuant to which severance benefits under Section 5.2 and
Section 5.3 are owing and any amounts due Executive pursuant to Section 5.2 and Section 5.3 shall not be reduced or suspended if Executive accepts subsequent employment or earns any amounts as a self-employed
individual. Executive’s rights under Section 5.2 and Section 5.3 are Executive’s sole and exclusive rights against the Company and any of its Affiliates and the Company’s and its Affiliates’ sole and
exclusive liability to Executive under, by reason of or related to this Agreement, whether in contract, tort or otherwise, for the termination of his employment by the Company. Nothing contained in this Section 5.7 shall be construed to
be a waiver by Executive of any benefits accrued for or due Executive under any employee benefit plan (as such term is defined in the Employees’ Retirement Income Security Act of 1974, as amended) maintained by the Company, CEP or any of their
respective subsidiaries except that Executive shall not be entitled to any severance benefits pursuant to any severance plan or program of the Company, CEP or any of their respective subsidiaries. 
  

 17 

 ARTICLE 6 
 OTHER AGREEMENTS 
 6.1 Protection of Confidential Information.

 (a) Disclosure to and Property of CEP or the Company. All information, designs, ideas, concepts,
improvements, product developments, discoveries and inventions, whether patentable or not, that are conceived, made, developed or acquired by Executive, individually or in conjunction with others, during the period of Executive’s employment by
the Company (whether during business hours or otherwise and whether on the Company’s premises or otherwise) that relate to CEP’s or the Company’s business, trade secrets, products or services (including all such information relating
to corporate opportunities, product specification, compositions, manufacturing and distribution methods and processes, research, financial and sales data, pricing terms, evaluations, opinions, interpretations, acquisition prospects, the identity of
customers or their requirements, the identity of key contacts within a customer’s organizations or within the organization of acquisition prospects, marketing and merchandising techniques, business plans, computer software or programs, computer
software and database technologies, prospective names and marks) (collectively, the “Confidential Information”) shall be disclosed to CEP or the Company and are and shall be the sole and exclusive property of the Company. Moreover,
all documents, videotapes, written presentations, brochures, drawings, memoranda, notes, records, files, correspondence, manuals, models, specifications, computer programs, e-mail, voice mail, electronic databases, maps, drawings, architectural
renditions, models and all other writings or materials of any type embodying any of such information, ideas, concepts, improvements, discoveries, inventions and other similar forms of expression (collectively, “Work Product”) are
and shall be the sole and exclusive property of the Company. Upon Executive’s termination of employment hereunder, for any reason, Executive shall promptly deliver such Confidential Information and Work Product, and all copies thereof, to the
Company. 
 (b) Disclosure to Executive. The Company has and will disclose to Executive, or place
Executive in a position to have access to or develop, Confidential Information and Work Product of CEP or the Company; and/or has and will entrust Executive with business opportunities of CEP or the Company; and/or has and will place Executive in a
position to develop business goodwill on behalf of CEP or the Company. Executive agrees to preserve and protect the confidentiality of all Confidential Information or Work Product. 
 (c) No Unauthorized Use or Disclosure. Executive agrees that he will not, at any time during or after Executive’s
employment hereunder, make any unauthorized disclosure of, and will prevent the removal from CEP’s or the Company’s premises of, Confidential Information or Work Product, or make any use thereof, except in the carrying out of
Executive’s responsibilities during the course of Executive’s employment hereunder. Executive shall use commercially reasonable efforts to cause all persons or entities to whom any Confidential Information shall be disclosed by him under
this Agreement to observe the terms and conditions set forth herein as though each such

  

 18 

 
person or entity was bound hereby. Executive shall have no obligation under this Agreement to keep confidential any Confidential Information if and to the extent that disclosure thereof is
specifically required by law; provided, however, that in the event disclosure is required by applicable law, Executive shall provide the Company with prompt notice of such requirement prior to making any such disclosure so that the
Company may seek an appropriate protective order. At the request of the Company at any time, Executive agrees to deliver to the Company all Confidential Information that he may possess or control. Executive agrees that all Confidential Information
(whether now or hereafter existing) conceived, discovered or made by him during the period of Executive’s employment hereunder exclusively belongs to the Company (and not to Executive), and Executive will promptly disclose such Confidential
Information to the Company and perform all actions reasonably requested by the Company to establish and confirm such exclusive ownership. Affiliates of the Company, shall be third-party beneficiaries of Executive’s obligations under this
Section 6.1. As a result of Executive’s employment hereunder, Executive may also from time to time have access to, or knowledge of, confidential information or work product of third parties, such as customers, suppliers, partners,
joint venturers and the like, of CEP or the Company. Executive also agrees to preserve and protect the confidentiality of such third-party confidential information and work product to the same extent, and on the same basis, as the Confidential
Information and Work Product. 
 (d) Ownership by the Company. If, during Executive’s employment
hereunder, Executive creates any work of authorship fixed in any tangible medium of expression that is the subject matter of copyright (such as videotapes, written presentations, computer programs, e-mail, voice mail, electronic databases, drawings,
maps, architectural renditions, models, manuals, brochures or the like) relating to CEP’s or the Company’s business, products or services, whether such work is created solely by Executive or jointly with others (whether during business
hours or otherwise and whether on CEP’s or the Company’s premises or otherwise), including any Work Product, the Company shall be deemed the author of such work if the work is prepared by Executive in the scope of Executive’s
employment; or, if the work is not prepared by Executive within the scope of Executive’s employment but is specially ordered by the Company as a contribution to a collective work, as a part of an audiovisual work, as a translation, as a
supplementary work, as a compilation or as an instructional text, then the work shall be considered to be work made-for-hire, and the Company shall be the author of the work. If such work is neither prepared by Executive within the scope of
Executive’s employment nor a work specially ordered that is deemed to be a work made-for-hire, then Executive hereby agrees to assign, and by these presents does assign, to the Company all of Executive’s worldwide right, title and interest
in and to such work and all rights of copyright therein. 
 (e) Assistance By Executive. During the period
of Executive’s employment hereunder and thereafter, Executive shall reasonably assist the Company and its nominee, at any time, in (a) the protection of the Company’s worldwide right, title and interest in and to Work Product,
(b) the execution of all formal assignment documents requested by the Company or its nominee and (c) the execution of all lawful oaths and applications for patents and registration of copyright in the United States and foreign countries.

  

 19 

 (f) Remedies. Executive acknowledges that money damages would not be
a sufficient remedy for any breach of this Section 6.1 by Executive, and the Company shall be entitled to enforce the provisions of this Section 6.1 by terminating payments then owing to Executive under this Agreement or
otherwise and to specific performance and injunctive relief as remedies for such breach or any threatened breach. Such remedies shall not be deemed to be the exclusive remedies for a breach of this Section 6.1 but shall be in addition to
all remedies available at law or in equity, including the recovery of damages from Executive and his agents. 
 6.2
Non-Disparagement. Except as required by law, for a period of one year immediately following any termination of Executive’s employment hereunder (a) Executive agrees to refrain from making any statement disparaging CEP or the
Company, any officer, manager, employee or other service provider for CEP or the Company, or any product or service offered by CEP, the Company or any of their respective Affiliates; and (b) the Company agrees to refrain from making any
statement disparaging Executive. 
 6.3 Non-Solicitation. For a period of one year immediately following any termination
of Executive’s employment hereunder, Executive shall not directly or indirectly solicit, induce, recruit, encourage or otherwise endeavor to cause or attempt to cause any employee or consultant of CEP or the Company to terminate their
relationship with CEP or the Company, as the case may be; provided, however, that nothing in this Section 6.3 shall prohibit the use of a general solicitation in a publication or by other means. 
 6.4 Claw-back. 
 (a) Post-Termination Payments. Executive agrees to promptly repay to the Company all payments made pursuant to any of Section 5.2, Section 5.3, Section 5.4 or
Section 5.5 if there has been a final and non-appealable judgment entered by a court of competent jurisdiction that found willful misconduct by Executive in the performance of his duties prior to the termination of his employment
hereunder. 
 (b) Pre-Termination Bonuses. Executive agrees to promptly repay to the Company any
Overpayment in the event of any restatement of CEP’s financial statements that are filed with the Securities and Exchange Commission. For purposes of this Section 6.4(b), “Overpayment” means the excess, if any, of
(i) the amounts actually paid by the Company pursuant to Section 4.2 for the two years immediately prior to such restatement over (ii) the amounts that should have been paid pursuant to Section 4.2 for those two
years based on the financial results reflected in such restated financial statements. 
 ARTICLE 7 
 MISCELLANEOUS 
 7.1 Indemnification. If Executive shall obtain any money judgment or otherwise prevail with respect to any litigation brought by Executive or the Company to enforce or interpret any provision contained herein, the Company, to the
fullest extent permitted by

  

 20 

 
applicable law, hereby indemnifies Executive for his reasonable attorneys’ fees, other reasonable professional fees and disbursements incurred in such litigation and hereby agrees
(i) to reimburse Executive in full all such fees and disbursements and (ii) to pay prejudgment interest on any money judgment obtained by Executive from the earliest date that payment to him should have been made under this Agreement until
such judgment shall have been paid in full, which interest shall be calculated, on a per-annum basis, at 2% plus the prime or base rate of interest as reported from time to time in the Wall Street Journal. All reimbursement obligations
arising pursuant to this Section 7.1 shall remain in effect throughout the applicable statute of limitations applicable to any contractual claim under this Agreement. Any expenses eligible for reimbursement hereunder shall not affect the
expenses eligible for reimbursement in any other calendar year. The right to reimbursement hereunder is not subject to liquidation or exchange for another benefit. 
 7.2 Payment Obligations Absolute. Except as specifically provided in Section 6.1(f), the Company’s obligation to pay Executive the amounts and to make the arrangements provided in
this Agreement shall be absolute and unconditional and shall not be affected by any circumstances, including any set-off, counterclaim, recoupment, defense or other right that CEP, the Company or any of their respective subsidiaries may have against
him or anyone else. All amounts payable by the Company (including its subsidiaries) shall be paid without notice or demand. Executive shall not be obligated to seek other employment in mitigation of the amounts payable or arrangements made under any
provision of this Agreement, and, except as provided in Section 5.2(c) or Section 5.3(e) hereof, the obtaining of any such other employment shall in no event effect any reduction of the Company’s obligations to make (or
cause to be made) the payments and arrangements required to be made under this Agreement. 
 7.3 Notices. For purposes of
this Agreement, notices and all other communications provided in this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by United States registered or certified mail, return receipt
requested, postage prepaid, or when sent by recognized overnight delivery service, addressed as follows: 
 If to the Company: 
 Constellation Energy Partners LLC 
 One Allen Center 
 500 Dallas Street, Suite 3200 
 Houston, TX 77002 
 Attention: Legal Department 
 If to Executive: 
 Michael B. Hiney 
 One Allen Center 
 500 Dallas Street, Suite 3200 
 Houston, TX 77002 
  

 21 

 or to such other address as either party may furnish to the other in writing in accordance herewith, except
that notices or changes of address shall be effective only upon receipt. 
 7.4 Applicable Law. This Agreement is entered
into under, and shall be governed for all purposes by, the laws of the State of Texas, without reference to its choice of law provisions. 
 7.5 No Waiver. No failure by either party hereto at any time to give notice of any breach by the other party of, or to require compliance with, any condition or provision of this Agreement shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. 
 7.6
Severability. Any provision in this Agreement that is prohibited or unenforceable in any jurisdiction by reason of applicable law shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability
without invalidating or affecting the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 
 7.7 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but
all of which together will constitute one and the same agreement. 
 7.8 Withholding of Taxes and Other Employee
Deductions. The Company may withhold from any benefits and payments made pursuant to this Agreement all federal, state, city and other taxes as may be required pursuant to any law or governmental regulation or ruling and all other normal
employee deductions made with respect to the Company’s employees generally. 
 7.9 Headings. The Article,
Section and paragraph headings have been inserted herein for purposes of convenience and shall not be used for interpretive purposes. 
 7.10 Gender and Plurals. Wherever the context so requires, the masculine gender includes the feminine or neuter, and the singular number includes the plural and conversely. 
 7.11 Assignment. This Agreement shall be binding upon and inure to the benefit of the Company and any successor of the Company, by
merger or otherwise. This Agreement shall also be binding upon and inure to the benefit of Executive and his estate. If Executive shall die prior to full payment of amounts due pursuant to this Agreement, such amounts shall be payable pursuant to
the terms of this Agreement to his estate. Executive shall not have any right to pledge, hypothecate, anticipate or assign this Agreement or the rights hereunder, except by will or the laws of descent and distribution. 
 7.12 Entire Agreement. This Agreement constitutes the entire agreement of the parties with regard to the subject matter hereof, and
contains all the covenants, promises, representations, warranties and agreements between the parties with respect to such subject matter. Without limiting the scope of the preceding sentence, all understandings and agreements preceding the date of
execution of this Agreement and relating to the subject matter hereof (including the Offer Letter) are hereby null and void and of no further force and effect, including all prior employment and severance agreements, if any, by and between the
Company and Executive. Any modification of this Agreement will be effective only if it is in writing and signed by both parties. 
  

 22 

 7.13 CEP Agreements. 
 (a) Offer Letter Termination. CEP and Executive agree that the Offer Letter is hereby terminated and of no further
force or effect. 
 (b) CEP Guaranty. CEP hereby unconditionally and irrevocably guarantees to Executive
the prompt and full discharge by the Company of all of the Company’s covenants, agreements, obligations and liabilities under this Agreement (the “Company Obligations”) in accordance with the terms hereof. CEP hereby guarantees
to Executive full and complete performance by the Company of each and all of the Obligations, including the due and punctual payment of all amounts that may become due and payable to Executive hereunder. CEP acknowledges and agrees that, with
respect to all Company Obligations that are obligations to pay money, such guaranty shall be a guaranty of payment and not of collection. If the Company shall default in the due and punctual performance of any of the Company Obligations, including
the full and timely payment of any amounts owed pursuant to the Company Obligations, CEP will forthwith perform or cause to be performed such Company Obligations and will forthwith make full payment of any amount due with respect thereto at its sole
cost and expense and without notice or demand by Executive or the necessity of exhausting Executive’s remedies against the Company in respect of such Company Obligations. Without limiting the generality of the remaining terms and conditions of
this Agreement, the parties to this Agreement agree and acknowledge that nothing in this Section 7.13(b) shall hinder the Company in the full exercise of its right to terminate the employment of Executive pursuant to
Section 3.2. 
 (c) CEP Not Employer. The Company, CEP and Executive each acknowledge and
agree that CEP is a party to this Agreement solely for the limited purpose making the agreements set out in this Section 7.13 and nothing in this Agreement is intended to make CEP the employer of Executive for any purpose. 
 [SIGNATURE PAGE FOLLOWS] 
  

 23 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of
the Effective Date. 
  

			
	THE COMPANY:
	
	CEP SERVICES COMPANY, INC.
		
	By:	 	 /s/ Stephen R. Brunner

	Name:	 	Steven R. Brunner
	Title:	 	President, CEO and COO
	
	EXECUTIVE
	
	 /s/ Michael B. Hiney

	Michael B. Hiney
		
	CEP:	 	
	
	 CONSTELLATION ENERGY PARTNERS LLC
 (solely for purposes of agreeing to Section 7.13 of this Agreement)

		
	By:	 	 /s/ Stephen R. Brunner

	Name:	 	Stephen R. Brunner
	Title:	 	President, CEO and COO

  

 24Employment Agreement

 Exhibit 10.1 
 EXECUTIVE OFFICER EMPLOYMENT AGREEMENT 
 This
Employment Agreement is being entered into on the date or dates hereinbelow written by and between Amerisafe, Inc., a Texas corporation with its principal place of business in DeRidder, Louisiana (the “Company”) and Brendan Gau, a
competent individual of the lawful age of majority who will principally render services in DeRidder, Louisiana (the “Employee”), and the parties hereby enter into this Employment Agreement (the “Agreement”) with an Effective Date
as designated below. 
 WITNESSETH: 
 WHEREAS, Employee desires to induce Company to employ him/her or continue to employ him/her and Employee desires to engage in or continue to engage in an employment relationship with Company and Company
desires to induce Employee to be employed with or to continue his/her employment with Company and Company desires to engage in an employment relationship or continue an employment relationship with Employee under the specific terms and conditions as
set forth below; 
 NOW, THEREFORE, in exchange for good and valuable consideration, the sufficiency and receipt of which is
hereby acknowledged and in exchange for the mutual covenants and obligations contained in this Agreement, Company and Employee hereby covenant and agree as follows: 
  

	1.	Employment. 

  

	 	(a)	Company hereby agrees to employ Employee, and Employee hereby accepts such employment with Company, for the period set forth in Section 2 hereof, subject to the
terms and conditions hereinafter set forth. 

  

	 	(b)	Employee affirms and represents that he/she is under no obligation to any former employer or other person or entity which is in any way inconsistent with, or which
imposes any restriction upon, Employee’s employment hereunder with Company, the employment of Employee by Company, or Employee’s undertakings under this Agreement. 

  

	2.	Term of Employment. Unless earlier terminated as provided in this Agreement, the term of Employee’s employment under this Agreement shall be for a period
beginning on June 23, 2009 (the “Effective Date”) and ending on June 22, 2012; provided, however, that this Agreement shall automatically renew for successive one year periods, unless either party shall notify the other in
writing not less than thirty (30) days prior to the third anniversary date or any successive anniversary date that such party does not intent to renew this Agreement. Such period, plus any annual renewal periods, or, if Employee’s
employment hereunder is earlier terminated as provided herein and including termination pursuant to Section 9, or such shorter period, is sometimes referred to herein as the “Employment Term”. 

  

 Page 1 of 18 

	3.	Duties. Employee shall be employed by the Company as a senior executive officer and shall endeavor in good faith to competently perform such duties as inherent
in Employee’s employment or any designated job position or as specified by Company and shall also perform and discharge such other employment duties and responsibilities as the Board of Directors or President of Company shall from time to time
reasonably determine, not inconsistent with Employee’s position as a senior executive officer with Company. Employee shall also comply with any By-Laws of Company, as applicable. Employee shall perform Employee’s duties principally at the
offices of the Company at 2301 Highway 190 West, DeRidder, Louisiana, with such travel to such other locations from time to time as the Board of Directors or President of Company may reasonably request. Except as may otherwise be approved in advance
by the Board of Directors of Company, and except during vacation periods and reasonable periods of absence due to sickness, injury or disability, Employee shall devote Employee’s full time throughout the Employment Term to the services required
of Employee hereunder; provided that the foregoing shall not prohibit Employee from engaging in reasonable charitable, civic and community activities. Employee shall render Employee’s business services exclusively to Company and its
subsidiaries and affiliate entities during the Employment Term and shall use his/her good faith efforts, judgment and energy to improve and advance the business and interests of the Company and its subsidiaries in a manner consistent with the duties
of Employee’s position. Employee shall diligently, prudently, professionally and responsibly perform his duties and shall discharge his employment utilizing his best faith efforts and prudent judgment with a high degree of proficiency and
competency and for the exclusive interest of company. 

  

	4.	General Compliance, Code of Ethics and Conflicts of Interest. 

  

	 	(a)	Employee shall comply with all applicable laws and regulations (federal, state and local) and shall comply with all applicable directives, orders, and regulations of
any governmental agency or regulatory body including federal, state, and local agencies and bodies. Employee shall also comply with all policies and procedures of the Company and directives of the Board of Directors. Employee understands,
acknowledges and agrees that he/she holds a position of trust and that fiduciary duties and responsibilities may apply under applicable law and that these duties and responsibilities may be continuing in nature, even after separation from
employment. Employee agrees to fully and faithfully perform and discharge all such duties, responsibilities, and obligations. 

  

	 	(b)	Employee has an obligation to act in an ethical manner in dealings with Company, with co-employees, with customers and any third party. In this regard, Employee is
required to be honest, forthright and to not take any action or make statements or engage in any conduct which is unethical, improper, or which could create the appearance of impropriety. In addition, Employee shall not engage in any conduct, take
any actions, or make statements which negatively reflect upon Company or in any way harm or potentially cause harm to the Company’s image, reputation or good will. 

  

 Page 2 of 18 

	 	(c)	Employee must also ensure that he/she does not engage in any conflict of interest. In this regard, Employee shall not engage in any activity or conduct which is
contrary to the exclusive interests of or in conflict with the exclusive interests of Company. All business opportunities presented to Employee during the course and scope of his/her employment or while employed with Company are to be used for the
benefit of Company only. Further, Employee shall not take any position contrary to Company’s interests or inconsistent with Employee’s employment with the Company. 

  

	5.	EEO Compliance. Employee shall not engage in any conduct which constitutes or which may be considered an unlawful employment practice or which violates or could
violate any employment practices, equal employment opportunity, discrimination, or retaliation laws or regulations (federal, state, or local). Employee acknowledges that the Company is an Equal Opportunity Employer and prohibits all forms of
unlawful discrimination in the terms and condition of employment, it prohibits all forms of harassment, including sexual harassment, and it prohibits retaliation against any employee who engages in protected activity. 

  

	6.	Salary and Bonus. 

  

	 	(a)	Salary. As compensation for the services to be performed by the Employee hereunder during the Employment Term, Company shall pay the Employee a base salary at
the annual rate of not less than ONE HUNDRED SIXTY FIVE THOUSAND and No/100s Dollars ($165,000.00) (said amount, together with any increases thereto as may be determined from time to time by the Compensation Committee of the Board of Directors of
Company in its sole discretion, being hereinafter referred to as “Salary”). Any Salary payable hereunder shall be paid in regular intervals in accordance with Company’s established and regular payroll practices from time to time in
effect, but in no event less than monthly. 

  

	 	(b)	Bonus. Employee shall be eligible to receive bonus compensation from Company for each fiscal year (or portion thereof) occurring during the Employment Term in
amounts, if any, as may be determined by the Compensation Committee of the Board of Directors of Company in its sole discretion on the basis of performance-based criteria or annual incentive plans to be established from time to time by such
Committee in its sole discretion, provided that any such Bonus so awarded shall be paid in the calendar year following the year in which the services for which such Bonus is awarded were performed. 

  

	 	(c)	Withholding and Taxes. The payment of any Salary and Bonus and the payment of any separation pay pursuant to this Agreement, shall be subject to applicable
withholding and payroll taxes, and such other deductions as may be required under the Company’s employee benefit plans. 

  

	7.	Other Benefits. 

 During
the Employment Term, Employee shall: 
  

 Page 3 of 18 

	 	(a)	be eligible to participate in all employee fringe benefits and pension, retirement or profit sharing plans that may be provided by the Company for its other senior
executive officers in accordance with the provision of any such plans, as the same may be in effect from time to time; 

  

	 	(b)	be eligible to participate in all medical and health plans or other employee welfare benefit plans that may be provided by the company for its other senior executive
officers in accordance with the provisions of any such plans, as the same be in effect from time to time; 

  

	 	(c)	be entitled to at least 23 vacation/personal days in each calendar year; Employee shall also be entitled to all paid holidays given by Company to its other senior
executive officers; 

  

	 	(d)	be entitled to sick pay and disability benefits in accordance with any Company policy that may be applicable to other senior executive officers from time to time;

  

	 	(e)	be entitled to a car allowance consistent with established Company practices as of the date hereof and which may be in effect from time to time;

  

	 	(f)	be entitled to accrue earned and unused vacation time and carry such unused time forward from year to year during the Employment Term, provided the amount of accrued
and unused time shall not exceed 200 hours at any time during the term hereof; and 

  

	 	(g)	be entitled to reimbursement for all reasonable and authorized out-of-pocket business expenses incurred by Employee in the performance of Employee’s duties
hereunder in accordance with Company policies and practices that may be applicable to senior executive officers from time to time, provided that such business expenses shall be reimbursed, if at all, not later than the year following that in which
such expenses are incurred, and that the amount of expenses eligible for reimbursement during one taxable year may not affect the amount of expenses eligible for reimbursement in another taxable year. 

  

 Page 4 of 18 

	8.	Confidential Information. Employee hereby covenants, agrees and acknowledges as follows: 

  

	 	(a)	Employee has and will have access to and will participate in the development of or be acquainted with confidential and proprietary information and trade secrets that
directly or indirectly relate to the business, prospects, operations and other aspects of the Company and any other present or future subsidiaries and affiliates of Company (collectively with the Company, the “Companies”), including but
not limited to (1) customer lists; the identity, lists or descriptions of new or prospective customers; financial statements; cost reports or other financial information; contract proposals or bidding information, business plans; training and
operations methods and manuals; personnel records; software programs; reports and correspondence; and management systems, policies or procedures, including related forms and manuals; (2) information pertaining to future developments such as
future marketing or acquisition plans or ideas; and (3) all other tangible and intangible property, which are used in the business and operations of the Companies but not made public. The information and trade secrets relating to the business
of the Companies described hereinabove in this paragraph 8(a) are hereinafter referred to collectively as the “Confidential Information”, provided that the term “Confidential Information” shall not include any information
(x) that is or becomes publicly available (other than as a result of violation of this Agreement by the Employee), or (y) that Employee receives or received on a non-confidential basis from a source (other than the Companies or any of
their representatives) that is not prohibited from disclosing such information by a legal, contractual or fiduciary obligation (provided, however that the Employee shall not be deemed to be in violation of this clause 8(a)(y) unless he/she has
actual knowledge of any such obligation on the party of any such source). “Confidential Information” also includes, but is in no way limited to: financial information, budgets, general plans, business plans, data, trade secrets, computer
software, technical information, research and development, product and service information, processes, insured lists, insured information, renewal and expiration dates, pricing and underwriting information, processes, procedures and standards, sales
information, marketing information, bid information, job or project information, contracts, purchasing information, data processing, formulas, designs, drafts, drawings, systems, specifications, means, techniques, compilations, intellectual
property, inventions, developments and improvements, operational methods, protocols, business strategies, market information, vendor or supplier information, personnel matters and records and matters that are sensitive, business, proprietary, and
confidential information. “Confidential Information” also includes, but is in no way limited to, any other proprietary, confidential, or business information or documentation which is protected by or which is otherwise defined as trade
secrets under any federal or state trade secret laws including, but in no way limited to, Louisiana’s Uniform Trade Secrets Act (La.R.S. 51:1431, et seq.) or other applicable law. 

  

	 	(b)	 Employee agrees that he/she will not use, disclose, communicate, disseminate, or otherwise make known, directly or indirectly, any Confidential
Information to any person or entity not employed by or directly affiliated with Company. Additionally, Employee agrees that he/she will not use any Confidential Information for the benefit of herself or for the benefit of any other person or entity
that is not employed by or affiliated with

  

 Page 5 of 18 

	 	 
Company or in any way that may be directly or indirectly competitive with or detrimental to the interests of Company. 

  

	 	(c)	In the event that Employee receives an order or subpoena from a court of competent jurisdiction and venue or an order or subpoena from a governmental agency with
jurisdiction and authority, Employee shall, within forty-eight (48) hours of receipt of such order or subpoena, immediately notify, by telephone communication and in writing, Company’s President or General Counsel and Employee shall
provide Company’s President or General Counsel with a copy of any such order or subpoena and Employee shall notify Company’s President or General Counsel of whether or not he/she intends to comply with the order or subpoena and Employee
shall cooperate with Company in any action it takes in order to protect its rights or to contest or dispute the disclosure of Confidential Information pursuant to such order or subpoena. 

  

	 	(d)	Employee acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 8 would be inadequate and, therefore,
agrees that Company shall be entitled to injunctive relief in addition to any other available rights and remedies in case of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as
prohibiting Company from pursuing any other rights and remedies available for any such breach or threatened breach. 

  

	 	(e)	Employee agrees that upon termination or separation of Employee’s employment with Company for any reason, Employee shall immediately return to the Company all
Confidential Information in Employee’s possession in whatever form maintained (including, without limitation, computer disks and other electronic and digital media). 

  

	 	(f)	The obligations of the Employee under this Section 8 shall, except as otherwise provided herein, survive the termination of the Employment Term or the termination
or separation of Employee’s employment with Company to the maximum period allowed by applicable law. 

  

	9.	Termination. 

  

	 	9.01	Employee’s employment hereunder shall be terminated upon the occurrence of any of the following: 

  

	 	(a)	death of the Employee (Death); 

  

	 	(b)	Employee’s inability to perform his/her duties or the essential functions of his/her job, with or without accommodation, on account of disability or incapacity for
a period of one hundred eighty (180) or more days, whether or not consecutive, within any period of twelve (12) consecutive months (Disability); 

  

	 	(c)	Company Termination for Cause (as defined herein); 

  

 Page 6 of 18 

	 	(d)	Company Termination Without Cause (as defined herein); 

  

	 	(e)	Employee Termination for Good Cause (as defined herein); or 

  

	 	(f)	Employee Termination Without Good Cause (as defined herein). 

  

	 	9.02	As used in this Agreement, “Company Termination for Cause” shall mean a termination of Employee’s employment by action of the Board of Directors or
President of Company (or their or his/her designee) at any time, including during the Employment Term, based on any one or more of the following: 

  

	 	(a)	The arrest, charge, indictment, guilty plea, nolo contendre/no contest plea, or conviction of any crime designated under any federal, state, or local law as a
felon or any crime involving theft, fraud, embezzlement, securities, drugs, or moral turpitude. 

  

	 	(b)	Any act of dishonesty or moral turpitude that the Board of Directors or President of Company reasonably determines is materially detrimental to the interests or image
of Company. 

  

	 	(c)	Any act, error, or omission of Employee that is materially detrimental to Company, which causes material damage to or liability of Company or which is likely to or
tends to cause material damage to or liability of Company. 

  

	 	(d)	Breach by Employee of fiduciary duties or the engagement in prohibited conflicts of interest. 

  

	 	(e)	Failure of Employee to follow and comply with reasonable and lawful instructions, orders or directives of the Board of Directors of Company or the President of Company,
following written notice to Employee by the Board of Directors of the alleged failure to comply and a reasonable period in which to cure same. 

  

	 	(f)	Gross neglect or negligence of Employee in the performance of his/her duties or the willful disregard by Employee of his/her obligations under this Agreement following
written notice to Employee by the Board of Directors of the alleged gross neglect, negligence, or willful disregard of obligations and a reasonable period in which to cure same. 

  

	 	(g)	Employee’s breach of this Agreement or any provision or term of this Agreement following written notice to Employee by the Board of Directors of the alleged breach
and a reasonable period in which to cure same. 

  

	 	9.03	For purposes of this Agreement, “Employer Termination Without Cause” shall mean a termination of Employee’s employment by Company or Company’s
nonrenewal of this Agreement for any reason or on any grounds other than a “Company Termination for Cause.” 

  

 Page 7 of 18 

	 	9.04	For purposes of this Agreement, “Employee Termination Without Good Cause” shall mean a termination or resignation of employment by Employee or Employee’s
nonrenewal of this Agreement for any reason or for any grounds other than an “Employee Termination for Good Cause.” 

  

	 	9.05	For purposes of this Agreement, “Employee Termination for Good Cause” shall mean Employee’s termination of or resignation from Employment or
Employee’s nonrenewal of this Agreement for any one or more of the following reasons: 

  

	 	(a)	Company materially and substantially adversely changes the nature or scope of the authority, powers, functions, responsibilities and duties associated with
Employee’s job position designated or existing as of the Effective Date of this Agreement without the consent of Employee; 

  

	 	(b)	Company’s material and substantial reduction of Employee’s Salary without the consent of Employee unless such reduction is part of a plan or decision of the
Board of Directors that results in a reduction in salary for substantially all of senior executive officers; 

  

	 	(c)	Company’s termination of Employee’s participation in employee benefits provided or existing as of the Effective Date of this Agreement unless such termination
of employee benefits is applicable to all senior executive officers of Company or unless termination is required or directed under the terms and conditions of any applicable benefit plans, summary plan descriptions, insurance policies or applicable
law. 

  

	 	(d)	Company requires, without Employee’s consent, Employee to have his principal location of work change to any location which is in excess of twenty-five
(25) miles from his/her principal work location existing as of the Effective Date of this Agreement if such change in work location materially increases Employee’s commute from Employee’s residence to Employee’s principal
location of work; or 

  

	 	(e)	Company’s material and substantial breach of its obligations to Employee pursuant to this Agreement. 

 In order for Employee to terminate or separate employment for purposes of Employee Termination for Good Cause, Employee shall be required
to give Company advance written notice of his intention to terminate or separate employment and such written notice shall describe the reasons constituting Employee Termination for Good Cause. Such written notice must be delivered to the President
of Company and Company shall be given thirty (30) days to cure, correct or otherwise remedy the item or items presented by Employee as constituting Employee Termination for Good Cause. Such notice by Employee to Company shall be given within
ninety (90) days of the occurrence of the event,

  

 Page 8 of 18 

 
action or item which Employee asserts constitutes grounds for Employee Termination for Good Cause, the failure of which shall constitute a waiver of such grounds for Employee Termination for
Cause. If Employee timely notifies the Company of the occurrence of an event described in paragraphs (a) through (e) above and the Company fails to timely cure such event, Employee shall terminate employment on or before 30 calendar days
after the date the Company’s cure period expires or Employee shall be deemed to have waived the right to have such termination based on such failure to cure be treated as a Employee Termination for Good Cause under this Agreement. 

 

	 	9.06	 In the event that Employee’s employment is terminated at any time by a Company Termination Without Cause or an Employee Termination for Good
Cause, for a twelve month period following the effective date of such termination, Company shall pay monthly (as severance, termination pay, separation pay, contract payout, compensation, or liquidated damages) (i) the monthly Salary that would
have otherwise been payable to the Employee during such period, and (ii) an amount equal to one-twelfth of the average of the three Bonuses most recently awarded under 6(b) and under predecessor agreements (or, if less than three, the average
of all Bonuses awarded under 6(b) and under predecessor agreements). Each such monthly payment shall be treated as a separate payment for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and will
be paid during such period in accordance with the Company’s then existing payroll practices, methods, or pay periods. In addition, in the event that Employee’s employment is terminated at any time by a Company Termination Without Cause or
an Employee Termination for Good Cause, Company will pay or reimburse Employee for a twelve month period following such termination the actual cost of COBRA continuing health coverage premiums, to the extent COBRA is applicable and Employee elects
COBRA continuing health coverage. In this regard, if Employee is eligible for COBRA continuing health benefits and if Employee timely elects COBRA continuing health care coverage, Company will pay and/or reimburse up to a maximum of twelve months of
COBRA continuing health care coverage premiums provided that such COBRA premiums shall be reimbursed, if at all, not later than the year following that in which such premiums are incurred, and that the amount of premiums eligible for reimbursement
during one taxable year may not affect the amount of premiums eligible for reimbursement in another taxable year. It shall be at Company’s option and discretion to either pay the COBRA premiums directly or to reimburse Employee for premiums
that Employee pays for COBRA continuing health coverage. Any premiums or amounts due for COBRA continuing health coverage beyond the twelve month period referenced above shall be at the sole cost and expense of Employee and will not be paid or
reimbursed by Company. The above described obligations of Company (continuation of Salary and Bonus for a twelve month period following and payment of COBRA premiums for a twelve month period following Company Termination Without Cause or Employee
Termination for Good Cause) shall be the exclusive remedies and payment obligations and no other amounts or obligations will be due and owing by Company to Employee. In

  

 Page 9 of 18 

	 	 
this regard, Company Termination Without Cause and Employee Termination for Good Cause may be effectuated at any time during the Employment Term or renewal and the only amounts that Company will
be obligated or required to pay are the amounts calculated according to the formulas set forth above. 

  

	 	9.07	Notwithstanding anything to the contrary expressed or implied herein, except as required by applicable law and except as set forth in Section 9.06 above, Company
shall not be obligated to make any payments to the Employee or on his/her behalf of whatever kind or nature by reason of the Employee’s cessation of employment (including, without limitation, by reason of a Company Termination for Cause,
Employee Termination Without Good Cause, Death or Disability), other than (i) such amounts, if any, of Employee’s Salary and Bonus as shall be accrued, earned and remained unpaid as of the effective date of employment separation and
(ii) such other amounts, if any, which may be then otherwise payable to the Employee pursuant to the terms of the Company’s benefits plans or pursuant to Section 7 above. 

  

	 	9.08	To the extent that a payment becomes due to Employee under this Agreement by reason of Employee’s termination of employment, the term “termination of
employment” will have the same meaning as “separation from service” under Section 409A of the Code. Notwithstanding anything to the contrary expressed or implied herein, if the Company makes a good faith determination that a
payment under the Agreement (i) constitutes a deferral of compensation for purposes of Section 409A of the Code, (ii) is made to Employee by reason of his/her separation from service and (iii) at the time such payment would
otherwise be made Employee is a “specified employee” within the meaning of Section 409A of the Code, the payment will be delayed until the first day of the seventh month following the date of such termination of employment to the
extent required by Section 409A of the Code. 

  

	10.	Restrictive Covenants: Non-Competition and Non-Solicitation. 

  

	 	10.01	 Introduction. The restrictive covenants set forth in this Agreement prohibiting competition and solicitation shall apply during the
“Restricted Period,” as defined herein, in the “Restricted Area,” as defined herein. Employee acknowledges and understands that one of the principal causes and considerations of Company employing or continuing to employ Employee
in a senior executive officer position is the restrictive covenants to which Employee is obligated under this Agreement. Employee further acknowledges and agrees that he/she will be granted access to and will be provided confidential, business and
proprietary information and trade secrets of Company and that he/she will have access to and will be provided confidential information and data to which only senior executive officers have access and that the provision and access of such information
constitutes additional consideration in exchange for the restrictive covenants contained herein. Additionally, Company will be providing to Employee special

  

 Page 10 of 18 

	 	 
and unique training opportunities and experience and he/she will be obtaining knowledge, experience and skills through employment with Company that may not otherwise be obtained or acquired by
Employee. 

  

	 	10.02	Restricted Period. For purposes of this Agreement, the “Restricted Period” shall mean the Employment Term plus: 

  

	 	(a)	in the event that the employment of the Employee is terminated by a Company Termination Without Cause or Employee Termination For Good Cause, a period of twelve months.
As such, the Restricted Period would be the Employment Term and duration of employment and would extend beyond termination or separation for twelve months; or 

  

	 	(b)	in the event that the employment of the Employee is terminated by Company by a Company Termination For Cause, or by Employee’s Termination Without Good Cause, the
Non-Compete Period shall expire upon the effective date of Employee’s separation of employment; provided, however, in such event, Company shall have the exclusive option and absolute right of extending the Restrictive Period for a period
of twelve months following the effective date of the termination or separation of employment if Company: (1) delivers written notice to the Employee irrevocably exercising such option before employment termination or separation or within 180
days after employment separation or termination and (2) agrees to pay and does pay the Employee the payments provided for under Section 9.06 of this Agreement for such twelve month period. If Company exercises this option and right and
complies with the requirements for same, the Restrictive Period shall be extended beyond the employment separation effective date for the twelve month period designed and Employee agrees and acknowledges that Employee is bound by such restrictive
covenants for the Restrictive Period. 

  

	 	10.03	Definition of Restricted Area. The term “Restricted Area” shall mean the states, parishes, counties and municipalities designated in Attachment
“A” which is incorporated herein by reference as if copied in extensio. 

  

	 	10.04	Business of the Company. Employee acknowledges and understands that the “business” of Company involves and relates to the underwriting of risks for,
the sale of and the servicing of workers’ compensation insurance, general liability insurance and commercial and business insurance product lines and related services. Employee further acknowledges, agrees and represents that he/she understands
and knows the business in which Company is engaged and the scope, activities and business pursuits involved in the business of Company. Employee further acknowledges and understands that the noncompetition and nonsolicitation of customer
restrictions in this Agreement prohibit the Employee from engaging, in any capacity or any position, and from conducting any activities or business similar to that of Company or that is competitive with Company and as provided under the specific
terms and conditions of this Agreement. 

  

 Page 11 of 18 

	 	10.05	Customers of the Company. For purposes of this Agreement, “customers” shall include, but are not limited to, insured businesses, persons, and entities
who have or have had insurance coverage with the Company and insurance agents with whom Company has contracts, agreements, arrangements or any type of business, insurance placement or working relationship. Employee acknowledges and represents that
Employee understands the nature of the Company’s customer relationships and who and what comprises its customers. 

  

	 	10.06	Non-Competition. During the Restricted Period, Employee shall not engage in any of the following activities in the Restricted Area: 

  

	 	(a)	Carry on or engage in his/her own business (as a sole proprietor, corporation, partnership, limited liability company, limited partnership or any other business entity
or business association) in competition with or similar to the business of Company. 

  

	 	(b)	Carry on or engage in a competing business or work similar to or in competition with the business of the Company as an employee, consultant, board member, officer,
manager, representative, contractor, consultant, subcontractor, independent contractor, or agent of any other person or entity or in any capacity with or for any other person or entity. 

  

	 	(c)	Acquire or have an interest in or an option or other right to acquire an interest in any entity or business which is carrying on or engaging in a competing business
with Company or in a business similar to that of the Company. The term “an interest” shall include, without limitation, an interest or right as a partner, shareholder, officer, director, member, general manager, principal, limited partner,
owner, trustee, financier, guarantor, surety, mortgagee and lender. 

  

	 	(d)	Accept or conduct any business or any transactions with any customer or former customer of Company or receive any compensation, remuneration or consideration arising
out of, related to or in any associated with any business arrangement or relationship with any customer or former customer of Company. 

  

	 	10.07	Non-Solicitation. During the Restricted Period, Employee shall not engage in the following activities in the Restricted Area: 

  

	 	(a)	Solicit the customers of Company. 

  

	 	(b)	Solicit the customers or former customers of Employee. 

  

	 	(c)	Accept business from any customer of Company. 

  

 Page 12 of 18 

	 	(d)	Accept business from any customer or former customer of Employee. 

  

	 	(e)	Service accounts or business of any customers of Company. 

  

	 	(f)	Service accounts or business of any customers or former customers of Employee. 

  

	 	(g)	Solicit, induce or attempt to induce any employee of the Company to leave the employ of the Company. 

  

	 	10.08	Application. Company and Employee agree that (i) each of the actions described in this Agreement constitute “carrying on and engaging in a business
similar to that of” Company and the “soliciting customers of” Company, as those terms are used in La.R.S. 23:921, and (ii) this Agreement shall have the broadest possible meaning and application as allowed under applicable law.
Additionally, any future amendment to La.R.S. 23:921 or decisions or rulings of any court of competent jurisdiction which would expand the Company’s rights or impose greater restrictions on Employee shall apply and shall be enforceable herein.
For purposes of this Agreement, the term “solicit” includes, but is in no way limited to, any and all direct and indirect solicitation of business (by Employee or through others) and the engagement in communications (through any format or
medium) for the purpose of or which would in any way facilitate or attempt to generate business, services, work or other business activities with the customer and this shall apply regardless of whether the customer initiates the contact with
Employee or Employee (or another person or entity) initiates the contact with the customer. 

  

	 	10.09	 Remedies. In the event of breach or threatened or attempted breach of any provision of this Agreement by Employee, the parties recognize
and acknowledge that such a breach would cause irreparable harm to the Company or that the Company may not have an adequate remedy at law and that the restrictive covenants contained in this Agreement are “obligations not to do” and that
the Company shall not be required to prove irreparable injury in order to obtain injunctive relief in the event of any breach or threatened breach of this Agreement. Employee further agree and acknowledge that if there is any breach or threatened
breach of any one or more of the provisions of this Agreement, the Company may, in addition to any other legal or equitable remedies which may be available to it, (i) obtain a temporary restraining order, preliminary injunction and permanent
injunction to enjoin or restrain Employee from the breach or threatened breach of any such provision or provisions without the necessity of posting a bond and (ii) require Employee to account for and pay over to Company all compensation,
profits, moneys, accruals, increments, remuneration or any other benefits derived or received by Employee as a result of any transactions or actions constituting a breach of any provision of this Agreement. Company shall also be entitled to recover
any damages, attorney’s fees and costs incurred by it in any legal action or to obtain specific performance of or to enforce this Agreement or to remedy any breach of this Agreement. All such remedies in favor of the

  

 Page 13 of 18 

	 	 
Company shall be cumulative and shall not be exclusive. In the event that the Company takes any legal action to enforce this Agreement or to remedy any breach of this Agreement, the Company shall
be entitled to recover and the Employee shall be liable for all attorney’s fees, court costs and expenses incurred by the Company in any such action. 

  

	 	10.10	Company Designation. As used in this Section 10, “Company” includes Amerisafe, Inc., American Interstate Insurance Company, Silver Oak Casualty,
Inc., American Interstate Insurance Company of Texas, Amerisafe General Agency, Inc. and any and all predecessor entities, successor entities, affiliate entities, parent companies, assigns and subsidiaries. The parties acknowledge and agree that the
restrictive covenants in this Section 10 enure to the benefit of and operate for the interest of all of the above-mentioned companies and affiliates and said entities are expressly designated as third party beneficiaries of this Section 10
and the restrictive covenants and obligations imposed on Employee. 

  

	 	10.11	Construction Reformation and Severability. It is understood and agreed that, should any portion of any clause or paragraph of this Section 10 be deemed too
broad to permit enforcement to its full extent, or should any portion of any clause or paragraph of this Section 10 be deemed unreasonable, invalid or unenforceable, then said clause or paragraph shall be reformed and enforced to the maximum
extent permitted by law. Additionally, if any of the provisions of this Section 10 are ever found by a court of competent jurisdiction to exceed the maximum enforceable (i) periods of time, (ii) geographic areas of restriction,
(iii) scope of noncompetition or nonsolicitation or (iv) description of the Company’s business or customers, or for any other reason, then such unenforceable element(s) of this Section 10 shall be reformed and reduced to the
maximum periods of time, geographic areas of restriction, scope of noncompetition or nonsolicitation or description of the Company’s business that is permitted by law. In this regard, any unenforceable, unreasonable or overly broad provision
shall be reformed or severed so as to permit enforcement to the fullest extent permitted by law and reformation and severability shall apply. 

  

	 	10.12	 Reasonableness. Employee acknowledges, represents and agrees that the restrictive covenants in this Section 10 are reasonable in nature,
scope, time and territory and in the terms and conditions set forth herein. Employee acknowledges, represents and agrees that the Company has expended substantial cost in training Employee and that the Company has provided him/her with access to
valuable information and has pro vided him/her with valuable experience. In addition, Employee acknowledges, represents and agrees that the Company has placed Employee in contact with its customers, and has made Employee part of its business plans.
Employee further acknowledges, represents and agrees that Employee would not have obtained such training, experience, contacts and information from other sources without the employment relationship with the Company. Employee further acknowledges,
represents and agrees that the foregoing have occurred or resulted based on the Company’s reliance on these restrictive covenants and Employee’s representations and obligations made herein. Employee further acknowledges, represents and
agrees

  

 Page 14 of 18 

	 	 
that this Section 10 and the obligations of Employee under these restrictive covenants are reasonable in order to protect the legitimate interests of the Company. Employee further
acknowledges, represents and agrees that by virtue of his/her job position, he/she has become an integral and influential component of the Company’s current and future business plans. It is the Employee’s desire and intent that this
Agreement be given full force and effect. Employee further acknowledges and agrees that enforcement of these restrictive covenants will not create an undue burden or hardship on him/her and will not impair or prevent him/her from earning a
livelihood based on his/her own education, training, experience, qualifications and skills. 

  

	11.	Assignment. 

  

	 	(a)	Neither this Agreement nor any right or interest hereunder shall be assignable by the Employee or his beneficiaries or legal representatives without the Company’s
prior written consent; provided, however, that nothing in this Section 11(a) shall preclude the Employee from designating a beneficiary to receive any benefit payable hereunder upon his death or incapacity. 

  

	 	(b)	Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge, or hypothecation or to exclusion, attachment, levy or similar process or to assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

  

	 	(c)	Company shall have the right, without Employee’s consent, to assign this Agreement and to assign any rights and obligations under this Agreement to any person or
entity including, but in no way limited to, any parent companies, subsidiaries, affiliate entities, predecessors, and successors. 

  

	12.	Binding Effect. Without limiting or diminishing the effect of Section 11 hereof, this Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, successors, legal representatives and assigns. 

  

	13.	Notices. All notices which are required or may be given pursuant to the terms of this Agreement shall be in writing and shall be sufficient in all respects if
given in writing and (i) delivered personally, (ii) five business days after being mailed by certified or registered mail, return receipt requested and postage prepaid, (iii) sent via a nationally recognized overnight courier, or
(iv) sent via facsimile confirmed by certified or registered mail, return receipt requested and postage prepaid, if to the Company at the Company’s principal place of business, and if to the Employee, at his home address most recently
filed with the Company, or to such other address or addresses as either party shall have designated in writing to the other party hereto. 

  

	14.	 Law Governing. This Agreement shall be governed by and construed in accordance with the laws of the State of Louisiana, without regard to the
application of conflicts of laws principles. Employee consents to the jurisdiction and venue of the 36th Judicial District

  

 Page 15 of 18 

	 	 
Court, Beauregard Parish, State of Louisiana and, alternatively, the U.S. District Court for the Western District of Louisiana, Lake Charles Division. 

  

	15.	Execution and Performance. Employee agrees and understands that this Agreement is being executed, in whole or in part, in Beauregard Parish, Louisiana.
Additionally, performance of this Agreement is to be rendered, in whole or in part, in Beauregard Parish, Louisiana. Employee further understands and acknowledges that the employment relationship between Employee and Company is principally centered
and based in Beauregard Parish, Louisiana. 

  

	16.	Severability. The Employee agrees that in the event that any court of competent jurisdiction shall finally hold that any provision of this Agreement is void or
constitutes an unreasonable restriction against the Employee, this Agreement shall not be rendered void but shall apply with respect to such extent as such court may judicially determine constitutes a reasonable restriction under the circumstances.
If any part of this Agreement is held by a court of competent jurisdiction to be invalid, illegible or incapable of being enforced in whole or in part by reason of any rule of law or public policy, such part shall be deemed to be severed from the
remainder of this Agreement for the purpose only of the particular legal proceedings in question and all other covenants and provisions of this Agreement shall in every other respect continue in full force and effect and no covenant or provision
shall be deemed dependent upon any other covenant or provision. Severability and reformation shall apply. 

 It is
understood and agreed that should any portion of any clause or paragraph of this Agreement be deemed too broad to permit enforcement to its full extent or should any portion of any clause or paragraph of this Agreement be deemed unreasonable, then
said clause or paragraph shall be reformed and enforced to the maximum extent permitted by law. 
  

	17.	Waiver. Failure to insist upon strict compliance with any of the terms, covenants or conditions hereof shall not be deemed a waiver of such term, covenant or
condition, nor shall any waiver or relinquishment of any right or power hereunder at any one or more times be deemed a waiver or relinquishment of such right or power at any other time or times. 

  

	18.	Entire Agreement; Modifications. This Agreement, with referenced Attachment “A”, constitutes the entire and final expression of the agreement of the
parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, oral and written, between the parties hereto with respect to the subject matter hereof. This Agreement may be modified or amended only by an
instrument in writing signed by both Employee and the President of Company, provided, however, that in light of the uncertainty with respect to the proper application of Section 409A of the Code, the Company reserves the right to make
amendments to the Agreement as the Company deems necessary or desirable solely to avoid the imposition of taxes or penalties under Section 409A. 

  

	19.	Counterparts and Multiple Originals. This Agreement may be executed in two or more counterparts and in multiple originals, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. 

  

 Page 16 of 18 

	20.	Interpretation. Company and Employee have jointly participated in the negotiations and drafting of this Agreement. In the event any question of intent or
interpretation arises, this Agreement shall be construed and interpreted as if drafted by both parties. 

  

	21.	References to Exhibits. All exhibits, schedules and other documents which are referred to herein are hereby incorporated by reference as if copied at length
herein. 

  

	22.	Consultation and Acknowledgment. Employee acknowledges and agrees that Employee has read and understands this Agreement and its effect, and that Employee has
had the opportunity to consult fully and freely with an attorney or other advisor of his choice regarding this Agreement and to have an attorney or advisor review and advise Employee with respect to this Agreement prior to his entering into this
Agreement. Employee further acknowledges that he/she has carefully read this entire Agreement and understands the nature and extent of the rights and obligations created by this Agreement and that he/she is entering into this Agreement voluntarily
and without coercion. Employee further acknowledges that this Agreement is being entered into after due thought and consideration and after a mutual and meaningful negotiation between the parties. 

  

			
	AMERISAFE, INC.
		
	By:	 	 /s/ C. Allen Bradley, Jr.

		 	C. Allen Bradley, Jr., President/CEO

			
		
	Date:	 	 June 19, 2009

	
	EMPLOYEE:
	
	 /s/ Brendan Gau

	Signature
	
	 Brendan Gau

	Print Name
	
	 June 23, 2009

	Date

  

 Page 17 of 18 

 ATTACHMENT “A” 
 Employment Agreement 
 “Designated Area”

 The following states constitute the “Designated Area” for purposes of the Employment Agreement, including
Section 10, entitled “Restrictive Covenants”, entered into between the Company and the Employee: 
 States of
Alabama, Alaska, Arkansas, California, Colorado, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada,
New Hampshire, New Mexico, New York, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Wisconsin and Wyoming. 
  

 Page 18 of 18

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