Document:

<PAGE>
                                                                  EXHIBIT 10(ix)

                              EMPLOYMENT AGREEMENT

                  THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is made as of
December 1, 2001 between KCS ENERGY, INC., a Delaware corporation whose
principal place of business is located at 5555 San Felipe, Suite 1200, Houston,
Texas 77056 (the "COMPANY") and HARRY LEE STOUT (the "EXECUTIVE").

The Company and Executive agree as follows:

         1. RECITALS.

                  1.1. Executive is employed by the Company.

                  1.2. The Company and Executive each believe it to be in their
respective best interest to enter into this Agreement setting forth the mutual
understandings and agreements reached between them with respect to Executive's
continuing employment with the Company.

         2. EMPLOYMENT; TERM. The Company shall employ Executive, and Executive
shall be employed by the Company, upon the terms and conditions provided in this
Agreement, commencing as of the date of this Agreement. Unless Executive's
employment is earlier terminated as provided in this Agreement, the term of this
Agreement shall continue until December 31, 2003 and shall automatically be
extended until the next December 31 each year thereafter unless notice of
non-renewal is provided by either party to the other at least one year prior to
the then scheduled expiration date.

         3. POSITION AND DUTIES. Executive shall serve as the President of KCS
Energy Services, a subsidiary of the Company, and shall have such duties,
responsibilities and authority as are customary to his position and as are
reasonably necessary for the performance of his obligations hereunder, subject
at all times to the authority of the board of directors, the Chief Executive
Officer and the Chief Operating Officer of the Company. Executive shall devote
all of his business time, attention, skill and efforts and his undivided loyalty
to the business and affairs of the Company.

         4. SALARY AND BONUS. The Company shall pay to Executive an annual
salary of $191,625 payable in periodic installments in accordance with the
customary payroll practices of the Company. The annual salary shall be subject
to annual review, commencing in 2002, for appropriate increases at the
discretion of the board of directors of the Company.

                  4.1. In addition to his salary, Executive will be eligible for
an annual cash bonus award depending upon the performance of the Company and

<PAGE>

Executive each year measured against the Company's business plan and the goals
for Executive for such year as determined by the board of directors of the
Company, or its compensation committee. The amount of the annual cash bonus
shall be equal to a percentage of Executive's base salary for the applicable
year, and the applicable percentage shall be based on the performance levels for
the applicable year, as follows:

<Table>
<Caption>
                  Performance Level                  Percentage
                  -----------------                  ----------
<S>                                                  <C>
                      Threshold                          15%
                      Target                             30%
                      Maximum                            60%
</Table>

The bonus percentages shall be prorated between performance levels. The bonus
percentages for performance levels shall be subject to review and modification
annually by the board of directors of the Company, or its compensation committee
consistent with the Company's compensation philosophy and market compensation.

                  4.2. All salary and bonus payments shall be subject to all
employee payroll deductions required by law.

         5. BENEFITS. Executive shall be entitled to continuation of executive
life and disability insurance coverage with premiums paid by the Company under
the existing life and disability insurance policies to the extent available to
the Company for costs comparable to those presently in effect. Executive shall
also be eligible to participate in the medical, health, insurance, 401(k), stock
option and similar plans and benefits of the Company from time to time in effect
for senior executives of the Company, subject to and in accordance with the
terms and conditions of each such plan or benefit; provided, however, that the
Company shall be entitled to modify or abolish any such plans or benefits and
nothing contained in this Agreement shall be deemed to limit the Company's
discretion to modify or abolish such plans or benefits for all covered
employees, including Executive. Executive acknowledges that any stock options or
other benefits that may be granted under the Company's stock option plan shall
be subject to the discretion of the board of directors of the Company. Executive
shall be entitled to vacation time each year in accordance with the Company's
policies.

         6. EXPENSE REIMBURSEMENT. The Company shall reimburse Executive for all
reasonable costs and expenses incurred by him in the performance of his duties
subject to and in accordance with the expense reimbursement policies of the
Company in effect from time to time.

         7. TERMINATION OF EMPLOYMENT. Executive's employment with the Company,
and the term of this Agreement, shall be subject to termination prior to the
Expiration Date, as follows:

                                      -2-
<PAGE>

                  7.1. The Company shall be entitled to terminate Executive's
employment at any time either for Cause or without Cause by giving Executive
notice of such termination setting forth the Termination Date, and if such
termination is for Cause, then the notice shall also set out the event or events
giving rise to such termination for Cause.

                  7.2. Executive shall be entitled to terminate Executive's
employment at any time either for Good Reason or other than for Good Reason by
giving the Company notice of such termination setting forth the Termination
Date. If Executive gives a termination notice pursuant to this Section 7.2, the
Company shall be entitled to accelerate the date of Executive's termination of
employment to any date prior to the date set forth in Executive's notice of
termination.

                  7.3. Either the Company or Executive shall be entitled to
terminate Executive's employment at any time because of Executive's permanent
disability.

                  7.4. Executive's employment shall automatically terminate upon
his death.

         8. COMPENSATION IN EVENT OF TERMINATION. Except as provided in this
Section 8, Executive shall not be entitled to any severance or other
compensation from the Company after his termination of employment.

                  8.1. If Executive's employment is terminated by the Company
for Cause or by Executive for other than Good Reason, then the Company shall pay
Executive any earned but unpaid salary and any accrued but unpaid vacation pay
as of the Termination Date and Executive shall not be entitled to any other
compensation from the Company.

                  8.2. If Executive's employment is terminated because of death
or permanent disability, then the Company shall pay Executive any accrued but
unpaid salary and any accrued but unpaid vacation pay as of the Termination Date
and a pro rata amount of Executive's targeted bonus for the year in which
Executive dies or becomes permanently disabled, and Executive shall not be
entitled to any further compensation from the Company, except that in the case
of a disability, Executive shall be entitled to such benefits, if any, payable
by the Company to its employees under any disability benefit plan which the
Company may have in effect as of the date of any such disability in which
Executive is a participant.

                  8.3. If the Company terminates Executive's employment other
than for Cause, death or permanent disability or Executive terminates his
employment for Good Reason, at any time other than within two (2) years after a
Change in Control, then the Company shall pay to Executive: (i) an amount equal
to Executive's annual base

                                      -3-
<PAGE>

salary in effect as of the Termination Date; plus (ii) the amount of any accrued
but unpaid salary as of the Termination Date; plus (iii) a pro rata amount of
Executive's targeted bonus for the year in which the Termination Date occurs;
plus (iv) the amount of any accrued but unpaid vacation pay through the
Termination Date.

                  8.4. If the Company terminates Executive's employment other
than for Cause, death or permanent disability or Executive terminates his
employment for Good Reason, at any time within 2 years after a Change in
Control, then the Company shall pay to Executive: (i) an amount equal to two (2)
times the greater of (a) Executive's annual base salary in effect as of the
Termination Date or (b) Executive's annual base salary in effect immediately
preceding the Change in Control; plus (ii) an amount equal to two (2) times the
greater of (a) the amount of any cash bonus payable to Executive for the year in
which the Termination Date occurs (provided that if Executive's bonus for such
year has not been determined as of the Termination Date, then the amount of the
bonus shall be determined as if Executive earned 100% of the targeted bonus for
such year) or (b) the amount of any cash bonus paid to Executive for the year
immediately preceding the year in which the Change in Control occurs; plus (iii)
the amount of any earned but unpaid salary as of the Termination Date; plus (iv)
a pro rata amount of Executive's targeted bonus for the year in which the
Termination Date occurs; plus (v) the amount of any accrued but unpaid vacation
pay through the Termination Date.

                  8.5. If the Company terminates Executive's employment at any
time other than for Cause, death or permanent disability or Executive terminates
his employment at any time for Good Reason, then any stock options or restricted
stock granted to Executive by the Company as of the Termination Date shall
immediately vest and remain exercisable until the later of (i) one (1) year from
the Termination Date or (ii) the date on which such options may be exercised
pursuant to the employee stock option plan under which they were granted.

                  8.6. If the Company terminates Executive's employment at any
time other than for Cause, death or permanent disability or Executive terminates
his employment at any time for Good Reason, then the Company shall continue to
maintain and pay the premiums for Executive's medical and life insurance with
coverage which is substantially similar to the coverage in effect as of the
Termination Date until the earlier of (i) in the case such termination occurs at
any time other than within two (2) years after a Change in Control, the first
anniversary after the Termination Date, or in the case such termination occurs
within two (2) years after a Change in Control, the second anniversary of the
Termination Date or (ii) the date Executive becomes employed by another employer
and is entitled to substantially similar benefits under such employer's benefit
plan. If continued coverage is not permitted under the Company's insurance
plans, then the Company will (a) provide Executive with substantially similar
insurance through

                                      -4-
<PAGE>

another insurance carrier or (b) reimburse Executive for the full cost of
obtaining such insurance.

                  8.7. All payments to Executive required to be made pursuant to
Sections 8.3 and 8.4 shall be paid by the Company within five (5) days after the
Termination Date and all payments to Executive required to be made under clause
(b) of the last sentence of Section 8.6 shall be paid within five (5) days of
Executive's furnishing the Company with evidence of the cost of such insurance,
in each case, by wire transfer or Company check at Executive's option. All
payments required to be made to Executive pursuant to this Agreement shall be
subject to the withholding of such payroll taxes as may be required by law.

         9. EXCISE TAXES. In the event it shall be determined that any payment
by the Company to or for the benefit of Executive pursuant to Section 8 of this
Agreement (determined without regard to any additional payments required under
this Section 9) (a "PAYMENT") would be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code or any successor statute (the "EXCISE
TAX"), then Executive shall be entitled to receive an additional payment (an
"EXCISE TAX PAYMENT") in an amount equal to the Excise Tax.

                  9.1. All determinations required to be made under this Section
9, including whether and when an Excise Tax Payment is required, the amount of
such Excise Tax Payment and the assumptions to be utilized in arriving at such
determination, shall be made by a nationally recognized accounting firm as shall
be designated by the Company (the "ACCOUNTING FIRM"). All fees and expenses of
the Accounting Firm shall be paid by the Company. Any Excise Tax Payment, as
determined pursuant to this Section 9, shall be paid by the Company to Executive
(or to the Internal Revenue Service on Executive's behalf) within thirty (30)
days of the receipt of the Accounting Firm's determination. All determinations
made by the Accounting Firm shall be binding upon the Company and Executive.

                  9.2. Executive shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Excise Tax Payment. Such notification shall be
given as soon as practicable but no later than ten business days after Executive
receives written notification of such claim (provided, however, that the failure
to provide such notification within such period as provided herein shall not
relieve the Company of its obligations under this Section 9 except to the extent
that the Company is materially prejudiced thereby) and shall apprise the Company
of the nature of such claim and the date on which such claim is requested to be
paid. Executive shall not pay such claim prior to the expiration of the 30-day
period following the date on which it gives such notice to the Company (or such
shorter period ending on the date that any payment of taxes with respect to such
claim is due). If the Company notifies Executive in writing prior to the

                                      -5-
<PAGE>

expiration of such period that it desires to contest such claim, Executive shall
take such action in connection with contesting such claim as the Company shall
reasonably request from time to time, including, without limitation, accepting
legal representation with respect to such claim by an attorney reasonably
selected by the Company, cooperating with the Company in good faith in order to
effectively contest such claim, and permitting the Company to participate in any
proceeding relating to such claim; provided, however, that the Company shall
bear and pay directly all reasonable costs and expenses (including additional
interest and penalties) incurred in connection with such contest. Without
limiting the foregoing provisions of this Section 9.2, the Company shall control
all proceedings taken in connection with such contest and may, at its sole
option, either direct Executive to pay the tax claimed and sue for a refund or
contest the claim in any permissible manner, as the Company shall determine and
direct; provided, however, that if the Company directs Executive to pay such
claim and sue for a refund, the Company shall advance the amount of such payment
to Executive, on an interest-free basis; and further provided that any extension
of the statute of limitations relating to the payment of taxes for Executive's
taxable year with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. If any Excise Tax, employment tax or
income tax is imposed on Executive as a result of any costs and expenses paid by
the Company in connection with any contest relating to the Excise Tax in
accordance with this Section 9.2, then the Company shall reimburse Executive for
the amount of any such Excise Tax, employment tax or income tax so imposed on
Executive as, if and when any such tax is imposed on Executive. Furthermore, the
Company's control of the contest shall be limited to issues with respect to
which an Excise Tax Payment would be payable hereunder and Executive shall be
entitled to settle or contest, as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.

                  9.3. If, after Executive's receipt of an amount advanced by
the Company pursuant to this Section 9, Executive becomes entitled to receive
any refund with respect to such claim, Executive shall promptly pay to the
Company the amount of such refund attributable to the Excise Tax on the Payment.

                  9.4. The provisions of this Section 9 shall survive the
expiration of the Term.

         10. NON-DISCLOSURE; NON-SOLICITATION.

                  10.1. Executive agrees that he will not, at any time during
the term of his employment by the Company, except in the performance of his
duties hereunder, or at any time after the termination of his employment
communicate or disclose to any person (other than the Company or its
affiliates), or use for his own account or the benefit of any other person any
Confidential Information (as hereinafter defined). For purposes of this
Agreement, the term "CONFIDENTIAL INFORMATION" shall mean any and all

                                      -6-
<PAGE>

confidential or proprietary knowledge and information relating to the business
of the Company or any of its subsidiaries or affiliates, except for any
information which shall be in the public domain other than as a result of
Executive's violations of his obligations under this Agreement.

                  10.2. Executive agrees that he will not, at any time during
the term of his employment by the Company, or at any time within two (2) years
after the termination of his employment, for his own account or benefit or for
the account or benefit of any other person, firm or entity, directly or
indirectly, solicit for employment or hire any employee of the Company or any of
its subsidiaries or induce any employee of the Company or any of its
subsidiaries to terminate his employment with the Company or any of its
subsidiaries.

         11. DEFINITIONS. As used in this Agreement, the following terms shall
have the indicated meanings:

                  11.1. "CHANGE IN CONTROL": The first to occur of any of the
following events which occurs at any time after the date of this Agreement and
on or before August 31, 2004 (but not thereafter): (i) Any "person" (as the term
is used in Section 13(d) and 14(d) of the Securities Exchange Act of 1934 (the
"EXCHANGE ACT"), other than a trustee or other fiduciary holding securities
under an executive benefit plan of the Company or any of its subsidiaries,
becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing more than 25%
of the combined voting power of the Company's then outstanding securities; (ii)
individuals who are members of the Board on the date of this Agreement (the
"INCUMBENT BOARD") cease for any reason to constitute at least a majority of the
Board, provided that any person becoming a director subsequent to the date of
this Agreement in replacement for a director who has died or become disabled and
whose election was approved by a vote of at least a majority of the directors
comprising the incumbent Board, or whose nomination for election by the
Company's stockholders was approved by the nominating committee serving under an
Incumbent Board, shall be considered a member of the Incumbent Board; (iii) a
merger or consolidation of the Company with any other corporation or other
business entity, other than a merger or consolidation which would result in the
combined voting power of the Company's securities outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at least 51% of the
combined voting power of the securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (iv) a sale or
disposition by the Company of all or substantially all of the Company's assets.

                  11.2. "CAUSE": The occurrence of any of the following events:

                                      -7-
<PAGE>

                           11.2.1. The commission by Executive of an act of
willful misconduct in any material respect including, but not limited to, the
willful violation of any material law, rule, regulation or cease and desist
order applicable to Executive or the Company (other than a law, rule or
regulation relating to a minor traffic violation or similar offense), or an act
which constitutes a breach of a fiduciary duty owed to the Company by Executive
involving personal profit;

                           11.2.2. The commission by Executive of an act of
dishonesty relating to the performance of Executive's duties, habitual unexcused
absence from work, willful failure to perform duties in any material respect
(other than any such failure resulting from Executive's incapacity due to
physical or mental illness or disability), or gross negligence in the
performance of duties resulting in damage or injury to the Company, its
reputation or goodwill (provided, however, that in the event of Executive's
willful failure to perform duties in any material respect, Executive shall be
provided with written notice of such event and shall be provided with a
reasonable opportunity, and in no event more than thirty (30) days, to cure such
failure to perform his duties); or

                           11.2.3. Any felony conviction of Executive or any
conviction involving dishonesty, fraud or breach of trust (other than for a
minor traffic violation or similar offense), whether or not in the line of duty.

                  11.3. "GOOD REASON": The occurrence of any of the following
events without the consent of Executive which remain in effect ten (10) days
after the Company receives written notice of any such event from Executive:

                           11.3.1. Any material diminution of Executive's
position with the Company including Executive's status, office, title,
responsibilities and reporting requirements;

                           11.3.2. Any reduction in Executive's annual base
salary or targeted bonus compensation; or

                           11.3.3. The Company's requiring Executive to be based
at any office location further than fifty (50) miles from Executive's office
location as of the date of this Agreement.

                  11.4. "TERMINATION DATE": (i) The date on which the Company
receives written notice (or any later date specified in such notice) that
Executive's employment with the Company is terminated (or such earlier date to
which the Company accelerates the date of Executive's termination of employment
as provided in Section 7.2) or (ii) the date on which Executive receives written
notice (or any later date specified in such notice) that Executive's employment
is terminated by the Company.

                                      -8-
<PAGE>

         12. RELEASE OF CLAIMS. No payments shall be made to Executive under
Sections 8.3, 8.4 and/or 8.6 of this Agreement unless and until Executive shall
sign and deliver to the Company an agreement in a form reasonably satisfactory
to the Company pursuant to which Executive agrees to release all claims he may
have against the Company, other than (i) claims arising under this Agreement and
claims with respect to the reimbursement of business expenses or with respect to
benefits which are to continue in effect in accordance with the terms of this
Agreement, (ii) claims he may have as a holder of options to acquire equity
securities of the Company (which shall be governed by the documents by which
Executive was granted such options) and (iii) claims he may have as a
shareholder of the Company.

         13. PRIOR AGREEMENTS. This Agreement shall supercede and replace all
prior agreements between the Company and Executive concerning Executive's
employment by the Company or the termination thereof, including but not limited
to the Change in Control Agreement dated August 1, 2001, and all of such prior
agreements are hereby terminated.

         14. MISCELLANEOUS PROVISIONS.

                  14.1. NO MITIGATION. Executive shall not be required to seek
other employment or otherwise mitigate damages in order to be entitled to the
full amount of any payment and benefits to which Executive is entitled under
this Agreement. The amount of such payments and benefits shall not be reduced by
any compensation or benefits received by Executive from other employment other
than with respect to the insurance benefits as provided in Section 8.6.

                  14.2. LITIGATION COSTS. In the event of any litigation between
the Company and Executive concerning this Agreement or any of the terms thereof,
the prevailing party in such litigation shall be entitled to recover its costs
of suit, including reasonable attorneys fees, from the other party.

                  14.3. AMENDMENTS. This Agreement shall not be amended or
modified in any way unless such amendment or modification is in writing and
signed by the Company and Executive.

                  14.4. ENTIRE AGREEMENT. This Agreement contains the entire
understanding of the Company and Executive concerning the subject matter hereof
and supersedes any prior or contemporaneous agreement, written or oral, with
respect to the same subject matter.

                  14.5. BINDING EFFECT. This Agreement is binding on the Company
and Executive and their respective successors in interest and as applicable,
personal representatives and beneficiaries.

                                      -9-
<PAGE>

                  14.6. GOVERNING LAW This Agreement is made and delivered in
the State of Texas, and shall be governed by and construed according to Texas
law, but without giving effect to any Texas choice of law provisions which would
make the laws of a different jurisdiction govern or apply.

                  14.7. NOTICES. All notices given pursuant to this Agreement
must be in writing and shall be deemed to have been duly given and to be
effective on delivery or refusal of delivery, if hand-delivered; or mailed,
postage prepaid, by certified or registered mail, return receipt requested; or
sent by Federal Express or other national courier service for next business day
delivery; or upon confirmation of receipt, if transmitted by fax; in each case
addressed to the Company at its principal place of business and to Executive
either at his office address (but if at his office address, then only by
hand-delivery) or his residence address as reflected on the Company's records,
or to such other address as the Company or Executive shall specify to the other
by a notice given pursuant to this Section 12.6.

                  14.8. INTERPRETATION. The terms of this Agreement have been
fully negotiated by the Company and Executive in consultation with their
respective counsel, and the final wording of this Agreement has been arrived at
by all of them as a result of such mutual discussions and negotiations.
Accordingly, no provision of this Agreement shall be construed against one
party, or in favor of another party, merely because of which party (or its
representative) drafted or supplied the wording for such provision.

                  IN WITNESS WHEREOF, the Company has caused this Agreement to
be executed by its duly authorized officer and Executive has signed this
Agreement, all as of the first date above written.

                                       KCS ENERGY, INC.

                                       By
                                         --------------------------------------
                                         Name:  JAMES W. CHRISTMAS
                                              ---------------------------------
                                         Title;    PRESIDENT
                                               --------------------------------

                                       ----------------------------------------
                                       HARRY LEE STOUT

                                      -10-<PAGE>
                                                                   EXHIBIT 10(x)

                              EMPLOYMENT AGREEMENT

                  THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is made as of
December 1, 2001 between KCS ENERGY, INC., a Delaware corporation whose
principal place of business is located at 5555 San Felipe, Suite 1200, Houston,
Texas 77056 (the "COMPANY") and J. CHRIS JACOBSEN (the "EXECUTIVE").

The Company and Executive agree as follows:

                  1. RECITALS.

                           1.1. Executive is employed by the Company.

                           1.2. The Company and Executive each believe it to be
in their respective best interest to enter into this Agreement setting forth the
mutual understandings and agreements reached between them with respect to
Executive's continuing employment with the Company.

                  2. EMPLOYMENT; TERM. The Company shall employ Executive, and
Executive shall be employed by the Company, upon the terms and conditions
provided in this Agreement, commencing as of the date of this Agreement. Unless
Executive's employment is earlier terminated as provided in this Agreement, the
term of this Agreement shall continue until December 31, 2003 and shall
automatically be extended until the next December 31 each year thereafter unless
notice of non-renewal is provided by either party to the other at least one year
prior to the then scheduled expiration date.

                  3. POSITION AND DUTIES. Executive shall serve as the Senior
Vice President of the Company and shall have such duties, responsibilities and
authority as are customary to his position and as are reasonably necessary for
the performance of his obligations hereunder, subject at all times to the
authority of the board of directors, the Chief Executive Officer and the Chief
Operating Officer of the Company. Executive shall devote all of his business
time, attention, skill and efforts and his undivided loyalty to the business and
affairs of the Company.

                  4. SALARY AND BONUS. The Company shall pay to Executive an
annual salary of $175,000 payable in periodic installments in accordance with
the customary payroll practices of the Company. The annual salary shall be
subject to annual review, commencing in 2002, for appropriate increases at the
discretion of the board of directors of the Company.

                           4.1. In addition to his salary, Executive will be
eligible for an annual cash bonus award depending upon the performance of the
Company and

<PAGE>

Executive each year measured against the Company's business plan and the goals
for Executive for such year as determined by the board of directors of the
Company, or its compensation committee. The amount of the annual cash bonus
shall be equal to a percentage of Executive's base salary for the applicable
year, and the applicable percentage shall be based on the performance levels for
the applicable year, as follows:

<Table>
<Caption>
                      Performance Level                  Percentage
                      -----------------                  ----------
<S>                                                      <C>

                           Threshold                        15%

                           Target                           30%

                           Maximum                          60%
</Table>

The bonus percentages shall be prorated between performance levels. The bonus
percentages for performance levels shall be subject to review and modification
annually by the board of directors of the Company, or its compensation committee
consistent with the Company's compensation philosophy and market compensation.

                           4.2. All salary and bonus payments shall be subject
to all employee payroll deductions required by law.

                  5. BENEFITS. Executive shall be entitled to continuation of
executive life and disability insurance coverage with premiums paid by the
Company under the existing life and disability insurance policies to the extent
available to the Company for costs comparable to those presently in effect.
Executive shall also be eligible to participate in the medical, health,
insurance, 401(k), stock option and similar plans and benefits of the Company
from time to time in effect for senior executives of the Company, subject to and
in accordance with the terms and conditions of each such plan or benefit;
provided, however, that the Company shall be entitled to modify or abolish any
such plans or benefits and nothing contained in this Agreement shall be deemed
to limit the Company's discretion to modify or abolish such plans or benefits
for all covered employees, including Executive. Executive acknowledges that any
stock options or other benefits that may be granted under the Company's stock
option plan shall be subject to the discretion of the board of directors of the
Company. Executive shall be entitled to vacation time each year in accordance
with the Company's policies.

                  6. EXPENSE REIMBURSEMENT. The Company shall reimburse
Executive for all reasonable costs and expenses incurred by him in the
performance of his duties subject to and in accordance with the expense
reimbursement policies of the Company in effect from time to time.

                  7. TERMINATION OF EMPLOYMENT. Executive's employment with the
Company, and the term of this Agreement, shall be subject to termination prior
to the Expiration Date, as follows:

                                      -2-
<PAGE>

                           7.1. The Company shall be entitled to terminate
Executive's employment at any time either for Cause or without Cause by giving
Executive notice of such termination setting forth the Termination Date, and if
such termination is for Cause, then the notice shall also set out the event or
events giving rise to such termination for Cause.

                           7.2. Executive shall be entitled to terminate
Executive's employment at any time either for Good Reason or other than for Good
Reason by giving the Company notice of such termination setting forth the
Termination Date. If Executive gives a termination notice pursuant to this
Section 7.2, the Company shall be entitled to accelerate the date of Executive's
termination of employment to any date prior to the date set forth in Executive's
notice of termination.

                           7.3. Either the Company or Executive shall be
entitled to terminate Executive's employment at any time because of Executive's
permanent disability.

                           7.4. Executive's employment shall automatically
terminate upon his death.

                  8. COMPENSATION IN EVENT OF TERMINATION. Except as provided in
this Section 8, Executive shall not be entitled to any severance or other
compensation from the Company after his termination of employment.

                           8.1. If Executive's employment is terminated by the
Company for Cause or by Executive for other than Good Reason, then the Company
shall pay Executive any earned but unpaid salary and any accrued but unpaid
vacation pay as of the Termination Date and Executive shall not be entitled to
any other compensation from the Company.

                           8.2. If Executive's employment is terminated because
of death or permanent disability, then the Company shall pay Executive any
accrued but unpaid salary and any accrued but unpaid vacation pay as of the
Termination Date and a pro rata amount of Executive's targeted bonus for the
year in which Executive dies or becomes permanently disabled, and Executive
shall not be entitled to any further compensation from the Company, except that
in the case of a disability, Executive shall be entitled to such benefits, if
any, payable by the Company to its employees under any disability benefit plan
which the Company may have in effect as of the date of any such disability in
which Executive is a participant.

                           8.3. If the Company terminates Executive's employment
other than for Cause, death or permanent disability or Executive terminates his
employment for Good Reason, at any time other than within two (2) years after a
Change in Control, then the Company shall pay to Executive: (i) an amount equal
to Executive's annual base

                                      -3-
<PAGE>

salary in effect as of the Termination Date; plus (ii) the amount of any accrued
but unpaid salary as of the Termination Date; plus (iii) a pro rata amount of
Executive's targeted bonus for the year in which the Termination Date occurs;
plus (iv) the amount of any accrued but unpaid vacation pay through the
Termination Date.

                           8.4. If the Company terminates Executive's employment
other than for Cause, death or permanent disability or Executive terminates his
employment for Good Reason, at any time within 2 years after a Change in
Control, then the Company shall pay to Executive: (i) an amount equal to two (2)
times the greater of (a) Executive's annual base salary in effect as of the
Termination Date or (b) Executive's annual base salary in effect immediately
preceding the Change in Control; plus (ii) an amount equal to two (2) times the
greater of (a) the amount of any cash bonus payable to Executive for the year in
which the Termination Date occurs (provided that if Executive's bonus for such
year has not been determined as of the Termination Date, then the amount of the
bonus shall be determined as if Executive earned 100% of the targeted bonus for
such year) or (b) the amount of any cash bonus paid to Executive for the year
immediately preceding the year in which the Change in Control occurs; plus (iii)
the amount of any earned but unpaid salary as of the Termination Date; plus (iv)
a pro rata amount of Executive's targeted bonus for the year in which the
Termination Date occurs; plus (v) the amount of any accrued but unpaid vacation
pay through the Termination Date.

                           8.5. If the Company terminates Executive's employment
at any time other than for Cause, death or permanent disability or Executive
terminates his employment at any time for Good Reason, then any stock options or
restricted stock granted to Executive by the Company as of the Termination Date
shall immediately vest and remain exercisable until the later of (i) one (1)
year from the Termination Date or (ii) the date on which such options may be
exercised pursuant to the employee stock option plan under which they were
granted.

                           8.6. If the Company terminates Executive's employment
at any time other than for Cause, death or permanent disability or Executive
terminates his employment at any time for Good Reason, then the Company shall
continue to maintain and pay the premiums for Executive's medical and life
insurance with coverage which is substantially similar to the coverage in effect
as of the Termination Date until the earlier of (i) in the case such termination
occurs at any time other than within two (2) years after a Change in Control,
the first anniversary after the Termination Date, or in the case such
termination occurs within two (2) years after a Change in Control, the second
anniversary of the Termination Date or (ii) the date Executive becomes employed
by another employer and is entitled to substantially similar benefits under such
employer's benefit plan. If continued coverage is not permitted under the
Company's insurance plans, then the Company will (a) provide Executive with
substantially similar insurance through

                                      -4-
<PAGE>

another insurance carrier or (b) reimburse Executive for the full cost of
obtaining such insurance.

                           8.7. All payments to Executive required to be made
pursuant to Sections 8.3 and 8.4 shall be paid by the Company within five (5)
days after the Termination Date and all payments to Executive required to be
made under clause (b) of the last sentence of Section 8.6 shall be paid within
five (5) days of Executive's furnishing the Company with evidence of the cost of
such insurance, in each case, by wire transfer or Company check at Executive's
option. All payments required to be made to Executive pursuant to this Agreement
shall be subject to the withholding of such payroll taxes as may be required by
law.

                  9. EXCISE TAXES. In the event it shall be determined that any
payment by the Company to or for the benefit of Executive pursuant to Section 8
of this Agreement (determined without regard to any additional payments required
under this Section 9) (a "PAYMENT") would be subject to the excise tax imposed
by Section 4999 of the Internal Revenue Code or any successor statute (the
"EXCISE TAX"), then Executive shall be entitled to receive an additional payment
(an "EXCISE TAX PAYMENT") in an amount equal to the Excise Tax.

                           9.1. All determinations required to be made under
this Section 9, including whether and when an Excise Tax Payment is required,
the amount of such Excise Tax Payment and the assumptions to be utilized in
arriving at such determination, shall be made by a nationally recognized
accounting firm as shall be designated by the Company (the "ACCOUNTING FIRM").
All fees and expenses of the Accounting Firm shall be paid by the Company. Any
Excise Tax Payment, as determined pursuant to this Section 9, shall be paid by
the Company to Executive (or to the Internal Revenue Service on Executive's
behalf) within thirty (30) days of the receipt of the Accounting Firm's
determination. All determinations made by the Accounting Firm shall be binding
upon the Company and Executive.

                           9.2. Executive shall notify the Company in writing of
any claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Excise Tax Payment. Such notification shall be
given as soon as practicable but no later than ten business days after Executive
receives written notification of such claim (provided, however, that the failure
to provide such notification within such period as provided herein shall not
relieve the Company of its obligations under this Section 9 except to the extent
that the Company is materially prejudiced thereby) and shall apprise the Company
of the nature of such claim and the date on which such claim is requested to be
paid. Executive shall not pay such claim prior to the expiration of the 30-day
period following the date on which it gives such notice to the Company (or such
shorter period ending on the date that any payment of taxes with respect to such
claim is due). If the Company notifies Executive in writing prior to the

                                      -5-
<PAGE>

expiration of such period that it desires to contest such claim, Executive shall
take such action in connection with contesting such claim as the Company shall
reasonably request from time to time, including, without limitation, accepting
legal representation with respect to such claim by an attorney reasonably
selected by the Company, cooperating with the Company in good faith in order to
effectively contest such claim, and permitting the Company to participate in any
proceeding relating to such claim; provided, however, that the Company shall
bear and pay directly all reasonable costs and expenses (including additional
interest and penalties) incurred in connection with such contest. Without
limiting the foregoing provisions of this Section 9.2, the Company shall control
all proceedings taken in connection with such contest and may, at its sole
option, either direct Executive to pay the tax claimed and sue for a refund or
contest the claim in any permissible manner, as the Company shall determine and
direct; provided, however, that if the Company directs Executive to pay such
claim and sue for a refund, the Company shall advance the amount of such payment
to Executive, on an interest-free basis; and further provided that any extension
of the statute of limitations relating to the payment of taxes for Executive's
taxable year with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. If any Excise Tax, employment tax or
income tax is imposed on Executive as a result of any costs and expenses paid by
the Company in connection with any contest relating to the Excise Tax in
accordance with this Section 9.2, then the Company shall reimburse Executive for
the amount of any such Excise Tax, employment tax or income tax so imposed on
Executive as, if and when any such tax is imposed on Executive. Furthermore, the
Company's control of the contest shall be limited to issues with respect to
which an Excise Tax Payment would be payable hereunder and Executive shall be
entitled to settle or contest, as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.

                           9.3. If, after Executive's receipt of an amount
advanced by the Company pursuant to this Section 9, Executive becomes entitled
to receive any refund with respect to such claim, Executive shall promptly pay
to the Company the amount of such refund attributable to the Excise Tax on the
Payment.

                           9.4. The provisions of this Section 9 shall survive
the expiration of the Term.

                  10. NON-DISCLOSURE; NON-SOLICITATION.

                           10.1. Executive agrees that he will not, at any time
during the term of his employment by the Company, except in the performance of
his duties hereunder, or at any time after the termination of his employment
communicate or disclose to any person (other than the Company or its
affiliates), or use for his own account or the benefit of any other person any
Confidential Information (as hereinafter defined). For purposes of this
Agreement, the term "CONFIDENTIAL INFORMATION" shall mean any and all

                                      -6-
<PAGE>

confidential or proprietary knowledge and information relating to the business
of the Company or any of its subsidiaries or affiliates, except for any
information which shall be in the public domain other than as a result of
Executive's violations of his obligations under this Agreement.

                           10.2. Executive agrees that he will not, at any time
during the term of his employment by the Company, or at any time within two (2)
years after the termination of his employment, for his own account or benefit or
for the account or benefit of any other person, firm or entity, directly or
indirectly, solicit for employment or hire any employee of the Company or any of
its subsidiaries or induce any employee of the Company or any of its
subsidiaries to terminate his employment with the Company or any of its
subsidiaries.

                  11. DEFINITIONS. As used in this Agreement, the following
terms shall have the indicated meanings:

                           11.1. "CHANGE IN CONTROL": The first to occur of any
of the following events which occurs at any time after the date of this
Agreement and on or before August 31, 2004 (but not thereafter): (i) Any
"person" (as the term is used in Section 13(d) and 14(d) of the Securities
Exchange Act of 1934 (the "EXCHANGE ACT"), other than a trustee or other
fiduciary holding securities under an executive benefit plan of the Company or
any of its subsidiaries, becomes the beneficial owner (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing more than 25% of the combined voting power of the Company's then
outstanding securities; (ii) individuals who are members of the Board on the
date of this Agreement (the "INCUMBENT BOARD") cease for any reason to
constitute at least a majority of the Board, provided that any person becoming a
director subsequent to the date of this Agreement in replacement for a director
who has died or become disabled and whose election was approved by a vote of at
least a majority of the directors comprising the incumbent Board, or whose
nomination for election by the Company's stockholders was approved by the
nominating committee serving under an Incumbent Board, shall be considered a
member of the Incumbent Board; (iii) a merger or consolidation of the Company
with any other corporation or other business entity, other than a merger or
consolidation which would result in the combined voting power of the Company's
securities outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) at least 51% of the combined voting power of the securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation; or (iv) a sale or disposition by the Company of all or
substantially all of the Company's assets.

                           11.2. "CAUSE": The occurrence of any of the following
events:

                                      -7-
<PAGE>

                                    11.2.1. The commission by Executive of an
act of willful misconduct in any material respect including, but not limited to,
the willful violation of any material law, rule, regulation or cease and desist
order applicable to Executive or the Company (other than a law, rule or
regulation relating to a minor traffic violation or similar offense), or an act
which constitutes a breach of a fiduciary duty owed to the Company by Executive
involving personal profit;

                                    11.2.2. The commission by Executive of an
act of dishonesty relating to the performance of Executive's duties, habitual
unexcused absence from work, willful failure to perform duties in any material
respect (other than any such failure resulting from Executive's incapacity due
to physical or mental illness or disability), or gross negligence in the
performance of duties resulting in damage or injury to the Company, its
reputation or goodwill (provided, however, that in the event of Executive's
willful failure to perform duties in any material respect, Executive shall be
provided with written notice of such event and shall be provided with a
reasonable opportunity, and in no event more than thirty (30) days, to cure such
failure to perform his duties); or

                                    11.2.3. Any felony conviction of Executive
or any conviction involving dishonesty, fraud or breach of trust (other than for
a minor traffic violation or similar offense), whether or not in the line of
duty.

                           11.3. "GOOD REASON": The occurrence of any of the
following events without the consent of Executive which remain in effect ten
(10) days after the Company receives written notice of any such event from
Executive:

                                    11.3.1. Any material diminution of
Executive's position with the Company including Executive's status, office,
title, responsibilities and reporting requirements;

                                    11.3.2. Any reduction in Executive's annual
base salary or targeted bonus compensation; or

                                    11.3.3. The Company's requiring Executive to
be based at any office location further than fifty (50) miles from Executive's
office location as of the date of this Agreement.

                           11.4. "TERMINATION DATE": (i) The date on which the
Company receives written notice (or any later date specified in such notice)
that Executive's employment with the Company is terminated (or such earlier date
to which the Company accelerates the date of Executive's termination of
employment as provided in Section 7.2) or (ii) the date on which Executive
receives written notice (or any later date specified in such notice) that
Executive's employment is terminated by the Company.

                                      -8-
<PAGE>

                  12. RELEASE OF CLAIMS. No payments shall be made to Executive
under Sections 8.3, 8.4 and/or 8.6 of this Agreement unless and until Executive
shall sign and deliver to the Company an agreement in a form reasonably
satisfactory to the Company pursuant to which Executive agrees to release all
claims he may have against the Company, other than (i) claims arising under this
Agreement and claims with respect to the reimbursement of business expenses or
with respect to benefits which are to continue in effect in accordance with the
terms of this Agreement, (ii) claims he may have as a holder of options to
acquire equity securities of the Company (which shall be governed by the
documents by which Executive was granted such options) and (iii) claims he may
have as a shareholder of the Company.

                           13. PRIOR AGREEMENTS. This Agreement shall supercede
and replace all prior agreements between the Company and Executive concerning
Executive's employment by the Company or the termination thereof, including but
not limited to the Change in Control Agreement dated August 1, 2001, and all of
such prior agreements are hereby terminated.

                  14. MISCELLANEOUS PROVISIONS.

                           14.1. NO MITIGATION. Executive shall not be required
to seek other employment or otherwise mitigate damages in order to be entitled
to the full amount of any payment and benefits to which Executive is entitled
under this Agreement. The amount of such payments and benefits shall not be
reduced by any compensation or benefits received by Executive from other
employment other than with respect to the insurance benefits as provided in
Section 8.6.

                           14.2. LITIGATION COSTS. In the event of any
litigation between the Company and Executive concerning this Agreement or any of
the terms thereof, the prevailing party in such litigation shall be entitled to
recover its costs of suit, including reasonable attorneys fees, from the other
party.

                           14.3. AMENDMENTS. This Agreement shall not be amended
or modified in any way unless such amendment or modification is in writing and
signed by the Company and Executive.

                           14.4. ENTIRE AGREEMENT. This Agreement contains the
entire understanding of the Company and Executive concerning the subject matter
hereof and supersedes any prior or contemporaneous agreement, written or oral,
with respect to the same subject matter.

                           14.5. BINDING EFFECT. This Agreement is binding on
the Company and Executive and their respective successors in interest and as
applicable, personal representatives and beneficiaries.

                                      -9-
<PAGE>

                           14.6. GOVERNING LAW This Agreement is made and
delivered in the State of Texas, and shall be governed by and construed
according to Texas law, but without giving effect to any Texas choice of law
provisions which would make the laws of a different jurisdiction govern or
apply.

                           14.7. NOTICES. All notices given pursuant to this
Agreement must be in writing and shall be deemed to have been duly given and to
be effective on delivery or refusal of delivery, if hand-delivered; or mailed,
postage prepaid, by certified or registered mail, return receipt requested; or
sent by Federal Express or other national courier service for next business day
delivery; or upon confirmation of receipt, if transmitted by fax; in each case
addressed to the Company at its principal place of business and to Executive
either at his office address (but if at his office address, then only by
hand-delivery) or his residence address as reflected on the Company's records,
or to such other address as the Company or Executive shall specify to the other
by a notice given pursuant to this Section 12.6.

                           14.8. INTERPRETATION. The terms of this Agreement
have been fully negotiated by the Company and Executive in consultation with
their respective counsel, and the final wording of this Agreement has been
arrived at by all of them as a result of such mutual discussions and
negotiations. Accordingly, no provision of this Agreement shall be construed
against one party, or in favor of another party, merely because of which party
(or its representative) drafted or supplied the wording for such provision.

                  IN WITNESS WHEREOF, the Company has caused this Agreement to
be executed by its duly authorized officer and Executive has signed this
Agreement, all as of the first date above written.

                                        KCS ENERGY, INC.

                                        By
                                          --------------------------------------
                                          Name:  JAMES W. CHRISTMAS
                                               ---------------------------------
                                          Title: PRESIDENT
                                                --------------------------------

                                        ----------------------------------------
                                        J. CHRIS JACOBSEN

                                      -10-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00037-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00037-of-00352.parquet"}]]