Extraction Oil & Gas, Inc. (Form: 8-K, Received: 03/05/2020 16:18:10)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 5, 2020

EXTRACTION OIL & GAS, INC.

(Exact name of registrant as specified in its charter)

Delaware

001-37907

46-1473923

(State or Other Jurisdiction
of Incorporation)

(Commission File Number)

(IRS Employer
Identification No.)

370 17th Street

Suite 5300

Denver

Colorado

80202

(Address of principal executive offices)

(Zip Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of exchange on which registered

Common Stock, par value $0.01

XOG

NASDAQ Global Select Market

Registrant’s telephone number, including area code (720) 557-8300

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Management Transition

As previously announced on April 4, 2019, Mark A. Erickson, the Chairman and Chief Executive Officer of Extraction Oil & Gas, Inc. (the “Company”), took a medical leave of absence during which Matthew R. Owens, the Company’s President and a member of the Company’s Board of Directors (the “Board”), was appointed as acting Chief Executive Officer of the Company. On March 5, 2020, the Company announced that, effective March 4, 2020, Mr. Erickson is departing as Chief Executive Officer of the Company and Chairman of the Board, Mr. Owens has been appointed the permanent Chief Executive Officer of the Company and Thomas B. Tyree, Jr. has been appointed as a member of the Board and Executive Chairman of the Company. Mr. Tyree has also been appointed to the Executive Committee of the Board. Mr. Erickson's departure is not as a result of any disagreement with the Company regarding any matter relating to its operations, policies or practices.

Departure of Mr. Erickson as Chief Executive Officer and the Chairman of the Board

In connection with Mr. Erickson’s departure from the Company as Chief Executive Officer and Chairman of the Board, the Company and Mr. Erickson are negotiating a separation agreement that is expected to be consistent with his previously-filed employment agreement, dated October 11, 2016. The eventual separation agreement will be filed on a future Current Report on Form 8-K when finalized.

Appointment of Mr. Tyree as Executive Chairman

In connection with Mr. Tyree’s appointment as a member of the Board and Executive Chairman of the Company, the Company entered into an employment agreement with Mr. Tyree, dated March 4, 2020 (the “Tyree Employment Agreement”). The Tyree Employment Agreement includes an initial term of three years, subject to termination upon notice or certain other conditions, and automatically extends for an additional one-year period every year thereafter unless the Company or Mr. Tyree gives written notice of non-extension within 90 days prior to the end of the initial term, or, if applicable, the current extension term. Pursuant to the terms of the Tyree Employment Agreement, Mr. Tyree’s initial annual base salary is $450,000 (subject to periodic review by the Board for increase), and Mr. Tyree is entitled to (1) a target annual bonus opportunity with an expected target value of 100% of his annual base salary and (2) an annual performance-based equity award with an expected target value of 450% of his annual base salary, in each case subject to annual adjustment by the Board.

If Mr. Tyree’s employment is terminated by the Company for any reason other than “cause” (and other than due to his disability or death) or if Mr. Tyree terminates employment for “good reason,” (the terms “cause” and “good reason,” as defined in the Tyree Employment Agreement), then, subject to Mr. Tyree’s timely execution and non-revocation of a release of claims, Mr. Tyree will be entitled to receive the following from the Company: (1) any earned but unpaid annual bonus for the calendar year ending prior to the date of termination; (2) a prorated annual bonus for the calendar year in which the termination occurs in an amount equal to the greater of (A) the annual bonus for the immediately preceding completed year and (B) Mr. Tyree’s target bonus opportunity for the year of termination; (3) a lump sum payment equal to two times (or three times, if such termination occurs within 12 months following a “change in control,” as such term is defined in the Tyree Employment Agreement) Mr. Tyree’s annual base salary at the time of termination and his “average annual bonus” (defined as the average annual bonus paid (or payable) for the two calendar years (or if Mr. Tyree was employed for less than two full calendar years such lesser number of full calendar years for which he was employed) preceding the date of termination, and if Mr. Tyree is terminated prior to December 31, 2020, his target 2020 annual bonus); (4) for a period of up to the date that Mr. Tyree first becomes eligible for medical insurance coverage

under Medicare, the Company will continue to provide medical insurance coverage to Mr. Tyree and his spouse and eligible dependents at the same cost to Mr. Tyree as immediately prior to the date of termination and (5) all outstanding equity-related awards held by Mr. Tyree will immediately vest with respect to time-based vesting provisions and (unless more favorable vesting is provided in the applicable award agreement) any performance-based vesting will vest based on actual performance through the end of the performance period (except that in the event of a “change in control,” any performance-based vesting will vest based on the greater of (A) an assumed achievement of all relevant performance goals at the “target” level or (B) the actual level of achievement of all relevant performance goals against target as of the Company’s fiscal quarter end before the “change in control”).

If Mr. Tyree’s employment is terminated due to his disability or death, Mr. Tyree will be entitled to receive the following from the Company: (1) a lump sum payment equal to one times Mr. Tyree’s annual base salary at the time of termination and his “average annual bonus”; and (2) all outstanding equity-related awards held by Mr. Tyree will immediately vest with respect to time-based vesting provisions and any performance-based vesting will vest based on actual performance through the end of the performance period.

The Tyree Employment Agreement also provides that Mr. Tyree is subject to customary non-competition and non-solicitation restrictions during the term of his employment and for a period of two years following termination.

In connection with his appointment, Mr. Tyree also (a) received an award of 2,500,000 restricted stock units (at target, with the opportunity to earn up to a maximum of 3,750,000 restricted stock units) (“Inducement RSUs”), which were granted in accordance with NASDAQ Listing Rule 5635(c)(4) and, therefore, not under a stockholder-approved plan, and (b) entered into an Indemnification Agreement with the Company (the “Indemnification Agreement”). The Inducement RSUs are subject to the terms of a restricted stock unit agreement between the Company and Mr. Tyree (the “RSU Agreement”), pursuant to which (1) up to 1,250,000 of the Inducement RSUs will be eligible to vest annually in three equal installments on the first three anniversaries of the grant, contingent on Mr. Tyree’s continuous service through each vesting date and (2) up to 1,250,000 of the Inducement RSUs (at target, with the opportunity to earn up to a maximum of 2,500,000 restricted stock units) will be eligible to vest subject to Mr. Tyree’s continuous service and to the achievement of certain performance goals. The Indemnification Agreement requires the Company to indemnify Mr. Tyree to the fullest extent permitted under Delaware law against liability that may arise by reason of his service to the Company, and to advance certain expenses incurred as a result of any proceeding against him as to which he could be indemnified.

Thomas B. Tyree, Jr., age 59, is currently the Executive Chairman of Northwoods Energy LLC, an upstream oil and gas company, a position he has held since January 2018 and a director of Antero Resources Corporation, a position he has held since October 2019. Previously, Mr. Tyree served as a director of Bonanza Creek Energy, Inc., a position he held from April 2017 until March 2020, and President, Chief Financial Officer and Member of the Board of Managers of Vantage Energy, LLC from 2006 until its sale to Rice Energy Inc. in October 2016. Prior to Vantage Energy, Mr. Tyree served as Chief Financial Officer of Bill Barrett Corporation from 2003 through 2006. From 1989 through 2003, Mr. Tyree served in various positions in the Investment Banking Division at Goldman, Sachs & Co., including as a Managing Director. Mr. Tyree began his career with Bankers Trust Company in 1983 as an Associate in Corporate Finance. Mr. Tyree received his M.B.A. from The Wharton School at the University of Pennsylvania with concentrations in Finance and Entrepreneurial Management. He received his B.A. from Colgate University with concentrations in Economics and Philosophy, and he currently serves as a member of the Colgate Board of Trustees.

There is no other arrangement or understanding between Mr. Tyree and any other persons pursuant to which he was appointed as a member of the Board and Executive Chairman of the Company. Mr. Tyree does not have any family relationship with any director or executive officer of the Company. There is no relationship between Mr. Tyree and the Company that would require disclosure pursuant to Item 404(a) of Regulation S-K.

The foregoing descriptions of the Inducement RSUs and the RSU Agreement are not complete and are qualified in their entirety by reference to the full text of the RSU Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated into this Item 5.02 by reference. The foregoing descriptions of the Tyree Employment Agreement and the Indemnification Agreement are not complete and are qualified in their entirety by reference to the full text of such agreements, which are filed as Exhibits 10.2 and 10.3 to this Current Report on Form 8-K and are incorporated into this Item 5.02 by reference.

Appointment of Mr. Owens as Chief Executive Officer

In connection with Mr. Owens’ appointment as permanent Chief Executive Officer, the Company and Mr. Owens entered into an amended and restated employment agreement, dated March 4, 2020 (the “Owens Employment Agreement”). The Owens Employment Agreement amends and restates the Employment Agreement that Mr. Owens and the Company originally entered into on October 11, 2016 (the “Original Employment Agreement”). The Owens Employment Agreement provides that Mr. Owens will serve as Chief Executive Officer and President of the Company and will have an annual base salary of $500,000. The other terms and conditions of the Owens Employment Agreement are materially consistent with the terms and conditions of the Original Employment Agreement. A summary of the material terms of the Original Employment Agreement and biographical information about Mr. Owens were disclosed in a Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission (the “SEC”) on October 14, 2016 and are incorporated into this Item 5.02 by reference. The foregoing does not purport to be a complete description of the Owens Employment Agreement and is qualified by reference to the full text of the Owens Employment Agreement which is attached as Exhibit 10.4 to this Current Report on Form 8-K and incorporated into this Item 5.02 by reference.

Mr. Owens, age 33, is currently the Company’s acting Chief Executive Officer and a member of the Company’s Board of Directors, and has served as an executive of the Company since it was founded in 2012. Mr. Owens has also served as a director of Triple Crown Resources, LLC, a private producer in the Midland Basin, since April 2017. From 2008 to 2010, he served as Operations Engineer for Gasco Energy, working deep, high-pressured gas in the Uinta Basin. While at Gasco Energy, he drilled and completed over 50 wells in the Mancos, Blackhawk and Mesaverde formations. From 2010-2012, Mr. Owens worked at PDC Energy, Inc., an oil and gas exploration and development company with a primary focus on the Wattenberg Field, as an Operations Engineer, leading the horizontal completion and production activities in the Wattenberg Field. He completed over 45 horizontal Codell and Niobrara wells and was responsible for optimizing production for the program. Mr. Owens holds a B.S. degree in petroleum engineering from the Colorado School of Mines.

Mr. Owens has no family relationships with any of the Company’s officers or directors. Information concerning Mr. Owens’s interests requiring disclosure under Item 404(a) of Regulation S-K is incorporated by reference to the Company’s definitive proxy statement filed with the SEC on April 5, 2019.

Executive Severance Plan

The Company has adopted an Executive Severance Plan (the “Executive Severance Plan”) and on March 4, 2020 entered into participation agreements thereunder (each, a “Participation Agreement”) with each of Eric J. Christ, the Company’s Vice President, General Counsel, Tom L. Brock, the Company’s Vice President, Chief Accounting Officer, and Marianella Foschi, the Company’s Vice President – Finance. Pursuant to the Participation Agreements, effective March 4, 2020, the benefits under the Executive Severance Plan will replace the existing employment agreements between the Company and each of Mr. Christ and Mr. Brock, and the existing employment agreements were terminated. Ms. Foschi was not subject to a prior employment agreement.

The Executive Severance Plan provides that in the event that employment of a participating employee is terminated by the Company other than for “cause” (and not by reason of death or disability) or if the executive terminates his or her employment for “good reason” (the terms “cause” and “good reason,” as defined in the Executive Severance Plan), and subject to the employee’s execution of a general release of claims against the Company and compliance with restrictive covenants, the employee is entitled to receive severance benefits consisting of:

•a lump sum cash amount equal to a multiple of the participant’s annual base salary as in effect immediately before the termination, with the multiple varying by participant, but established at 1.33 for Messrs. Christ and Brock and 0.75 for Ms. Foschi;

•a pro-rated target annual cash bonus for the year of termination (based on the number of days employed during the year of termination);

•up to 18 months of Company-paid COBRA coverage;

•vesting of all outstanding and unvested time-based equity awards;

•pro-rated vesting of outstanding and unvested performance-based equity awards (based on the number of days employed during the applicable performance period); and

•each exercisable equity plan award (e.g., a stock option or a stock appreciation right) that is or becomes exercisable will remain exercisable until the latest date on which the award would have expired by its original terms.

Under the Executive Severance Plan, if such a termination of employment occurs within the 18-month period immediately following a change of control, the executive would be entitled to the benefits described in the preceding paragraph subject to the same release of claims and restrictive covenant requirements, except that the salary continuation discussed in the first bullet above would be replaced by a lump sum cash payment equal to a higher multiple of the executive’s base salary plus their target annual bonus in effect immediately prior to termination (with the multiple varying by participant, but established at 2.0 for Messrs. Christ and Brock and 1.33 for Ms. Foschi) and the vesting acceleration of outstanding and unvested performance-based equity awards would be 100% of the unvested performance-based equity awards based on the greater of target and actual level of performance through the date of the Company’s fiscal quarter end before the change in control, rather than a pro-rated portion.

The Executive Severance Plan also provides for a lump sum cash payment equal to the executive’s base salary and a pro-rated target annual bonus payment, along with full vesting acceleration of time-based and performance-based equity awards (based on actual level of performance through the date of the Company’s fiscal quarter end before the termination) in the event that a participating executive dies or becomes disabled while employed by the Company subject to the same release of claims and restrictive covenant requirements.

The foregoing description of the Executive Severance Plan and the Participation Agreements are qualified in their entirety by reference to the complete text of the Executive Severance Plan and the Form of Participation Agreement, copies of which are attached hereto as Exhibits 10.5 and 10.6 to this Current Report on Form 8-K and incorporated into this Item 5.02 by reference.

Item 7.01 Regulation FD Disclosure.

On March 5, 2020, the Company announced the departure of Mr. Erickson and the appointments of Mr. Owens and Mr. Tyree. A copy of the press release is furnished herewith as Exhibit 99.1.

The information in Item 7.01 of this Current Report, including the exhibit attached hereto as Exhibit 99.1, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in Item 7.01 of this Current Report shall

not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, except as otherwise expressly stated in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits.



Exhibit No.		Description
10.1	Restricted Stock Unit Award Agreement, dated February March 4, 2020, by and between Extraction Oil & Gas, Inc. and Thomas Tyree.
10.2	Employment Agreement, dated March 4, 2020, by and between Extraction Oil & Gas, Inc. and Thomas Tyree.
10.3	Indemnification Agreement, dated March 4, 2020, by and between Extraction Oil & Gas, Inc. and Thomas Tyree.
10.4	Amended and Restated Employment Agreement, dated March 4, 2020, by and between Extraction Oil & Gas, Inc. and Matt Owens.
10.5	Extraction Oil & Gas, Inc. Executive Severance Plan.
10.6	Form of Participation Agreement.
99.1	Press Release of Extraction Oil & Gas, Inc. dated March 5, 2020.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



			EXTRACTION OIL & GAS, INC.


			By:			/S/ TOM L. BROCK.
						Tom L. Brock
						Vice President and Chief Accounting Officer (principal financial officer)

Dated: March 5, 2020

EXHIBIT 10.1

EXTRACTION OIL & GAS, INC.

RESTRICTED STOCK UNIT (RSU) AGREEMENT

(Part Time-Vesting; Part Performance-Vesting)

(Share-Settled)


Grant Date:			March 4, 2020 (the “Grant Date”)
Name of Grantee:			Thomas B. Tyree, Jr. (the “Grantee” or “you”)
Target number of RSUs subject to Award:			2,500,000 (consisting of 1,250,000 Time-Based RSUs and 1,250,000 Performance-Based RSUs)
Maximum number of RSUs subject to Award:			3,750,000 (consisting of 1,250,000 Time-Based RSUs and 2,500,000 Performance-Based RSUs)

This Restricted Stock Unit (RSU) Agreement (“Agreement”) is made and entered into as of the Grant Date by and between Extraction Oil & Gas, Inc., a Delaware corporation (the “Company”), and you.

WHEREAS, the Company has adopted the Extraction Oil & Gas, Inc. 2016 Long Term Incentive Plan (as amended from time to time, the “Plan”);

WHEREAS, the Company, in order to induce you to dedicate service to the Company and to materially contribute to the success of the Company, agrees to grant you this award of Restricted Stock Units (“RSUs”);

WHEREAS, the RSUs are being granted outside of the Plan, but will be subject to certain terms and conditions of the Plan as set forth herein;

WHEREAS, the RSUs are intended to qualify as an “employment inducement grant” under NASDAQ Listing Rule 5635(c)(4);

WHEREAS, you acknowledge that a copy of the Plan has been furnished to you (and is also publicly filed) and the terms capitalized but not defined herein shall have the meanings set forth in the Plan, unless the context requires otherwise; and

WHEREAS, you desire to accept the award of RSUs granted pursuant to this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants set forth herein and for other valuable consideration hereinafter set forth, the parties agree as follows:

1.The Grant.

a.Subject to the conditions set forth below, the Company hereby grants you, effective as of the Grant Date, as a matter of separate inducement and not in lieu of any salary or other compensation for your services for the Company, an award of RSUs (the “Award”) consisting of the number of RSUs set forth above in accordance with the terms and conditions set forth herein.

b.Notwithstanding that the Award is granted outside of the Plan, this Agreement shall be administered by the Committee and is otherwise subject in all respects to the following terms and provisions of the Plan: Section 1, Section 2, Section 3, Section 6, Section 7, Section 9, and Section 10, all of which terms and provisions are incorporated herein by reference as a part of this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, this Agreement shall control.

EXHIBIT 10.1

2.Settlement of RSUs. Subject to Sections 9 and 30, as soon as reasonably practicable after the RSUs vest as provided in Section 5 or 6 (but in no event later than March 15 following the end of the calendar year in which the RSUs vest), the Company shall settle the vested RSUs in shares of Stock (“Shares”), by delivering one Share for each such RSU, rounded down in the event of a fraction. The Company, in its sole discretion, may elect to deliver the Shares in either certificate form or in electronic, book-entry form, with such legends or restrictions thereon as the Committee may determine to be necessary or advisable in order to comply with applicable securities laws. You shall complete and sign any documents and take any additional action that the Company may request to enable it to deliver Shares on your behalf.

3.No Stockholder Rights. Unless and until the RSUs are settled, you shall not have any rights of ownership in or with respect to the RSUs, including without limitation, voting and Dividend Equivalent rights.

4.Restrictions; Forfeiture. The RSUs may not be sold, transferred or otherwise alienated or hypothecated until they have been settled as described in Section 2. The RSUs may also be forfeited to the Company as provided in Sections 5 and 6.

5.Vesting Requirements. Subject to the terms and conditions of this Agreement, the RSUs will vest subject to the satisfaction of both a time-based vesting schedule and a performance-based vesting schedule, as set forth in subsections (a) and (b) of this Section 5.

a.Time-Based Vesting. Fifty percent (50%) of the RSUs will time vest in equal, one-third (1/3) annual installments over three (3) years, commencing on the first anniversary of the Grant Date (as set forth in the table below) (the “Time-Based RSUs”), subject to your continued provision of service to the Company or a Company Affiliate as an employee or as an independent contractor in any managerial or governance capacity, or as a member of the Board or a board of a Company Affiliate (“Service”) through the applicable vesting date.


Vesting Amount of Time-Based RSUs			Vesting Date
1/3			1st anniversary of Grant Date
1/3			2nd anniversary of Grant Date
1/3			3rd anniversary of Grant Date

For avoidance of doubt, changes in the type of Service provided (i.e., ceasing to be an employee but remaining as a Board member) shall not result in a termination of Service for purposes of this Agreement.

b.Performance-Based Vesting. Fifty percent (50%) of the RSUs will performance vest upon the achievement of the performance goals set forth in Appendix A attached hereto (the “Performance-Based RSUs”), subject to your continued Service through the third anniversary of the Grant Date.

c.Notwithstanding any provision of this Agreement to the contrary, a maximum of 150% of the target number of RSUs reflected in the table at the beginning of this Agreement shall be eligible to become vested (consisting of up to 100% of the Time-Based RSUs and 200% of the Performance-Based RSUs). Except as otherwise provided in Section 6, any Performance-Based RSUs that do not vest at the end of the Performance Period shall be forfeited.

EXHIBIT 10.1

6.Termination of Services.

a.Termination due to Death, Disability or Retirement. Notwithstanding Section 5, if your Service is terminated (i) due to your death, (ii) as a result of your Disability (as defined in Section 6(b)), or (iii) upon your voluntary separation from Service when you (A) are at least age 55, (B) have at least ten (10) years of continuous Service and (C) have provided at least six (6) months prior written notice to the Company, then you shall become immediately vested in the Time-Based RSUs, and the Performance-Based RSUs shall vest at the end of each relevant Performance Period (or immediately, in respect of any Performance Period that has already ended) based on the level of achievement of the performance goals set forth in Appendix A. Any RSUs not vesting will be forfeited

b.Termination without Cause or for Good Reason. If your Service is terminated (i) by you for Good Reason (as such term is defined below) or (ii) by the Company for a reason other than Cause (as such term is defined below), (x) 100% of the target number of unvested Time-Based RSUs granted hereunder will vest in full, (y) any portion of the Performance-Based RSUs for which the Performance Period has ended prior to the date of termination shall vest based on the level of achievement of the performance goals set forth in Appendix A for the applicable Performance Period, and (z) any portion of the Performance-Based RSUs for which the Performance Period has not ended prior to the date of termination shall immediately vest at the “Target” level of achievement set forth in Appendix A. The Committee may, in its sole discretion, advise you in writing, prior to a voluntary termination of your Service, that such termination will be treated for purposes of this paragraph as an involuntary termination by the Company for a reason other than Cause. As used in this Agreement, the terms “Disability,” “Cause” and “Good Reason” shall have the same meaning given such terms under that certain Employment Agreement entered into by and between you and the Company dated as of March 4, 2020, as the same may be modified or amended from time to time (the “Employment Agreement”).

c.Termination other than due to Death, Disability or Retirement and other than without Cause or for Good Reason. If your Service is terminated for any reason other than as described in Section 6(a) or Section 6(b), then, subject to the terms of any written employment agreement between you and the Company (including the Employment Agreement), those RSUs that have not vested as of the date of termination shall be forfeited to the Company.

d.Change in Control. Notwithstanding Section 5, upon the occurrence of a Change in Control, (i) for any portion of the Performance-Based RSUs for which the Performance Period has ended prior to the date of the Change in Control, such Performance-Based RSUs shall vest based on the level of achievement of the performance goals set forth in Appendix A for the applicable Performance Period, and (ii) for any portion of the Performance-Based RSUs for which the Performance Period has not ended prior to the date of the Change in Control, the Company will deem the Performance Period to end immediately prior to the Change in Control event, and such Performance-Based RSUs shall vest upon the Change in Control at the greater of (A) assumed achievement of the performance goals set forth in Appendix A at the “Target” level or (B) the actual level of achievement of the performance goals set forth in Appendix A as of the Change in Control; and any Performance-Based RSUs not vesting will be forfeited.

7.Leave of Absence. With respect to the Award, the Company may, in its sole discretion, determine that if you are on leave of absence for any reason you will be considered to still be in the Service, provided that rights to the RSUs during a leave of absence will be limited to the extent to which those rights were earned or vested when the leave of absence began.

EXHIBIT 10.1

8.Payment of Taxes. In connection with any disposition of Shares or cash acquired pursuant to settlement of the Award, you (or any person permitted to receive such disposition or payment in the event of your death) shall be responsible for satisfying withholding taxes and other tax obligations relating to the Award or payment. Such tax obligations shall be satisfied through net withholding (which is a reduction of the amount of Shares or cash, as determined by the Committee, otherwise issuable or deliverable pursuant to the Award or payment) and the maximum number of Shares that may be so withheld shall be the number of Shares that have an aggregate Fair Market Value on the date of withholding or surrender equal to the aggregate amount of such tax liabilities determined based on the greatest withholding rates for federal, state, local and/or foreign tax purposes, including payroll taxes, that may be utilized without creating adverse accounting treatment for the Company with respect to the Award or payment, as determined by the Committee. You acknowledge that there may be adverse tax consequences upon the transfer, vesting or settlement of the Award, the disposition of the underlying Shares or cash and that you have been advised, and hereby are advised, to consult a tax advisor prior to such transfer, vesting, settlement, disposition or payment. You represent that you are in no manner relying on the Board, the Committee, the Company or any of its Affiliates or any of their respective managers, directors, officers, employees or authorized representatives (including, without limitation, attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial representatives) for tax advice or an assessment of such tax consequences.

9.Compliance with Securities Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of Stock will be subject to compliance with all applicable requirements of federal, state, or foreign law with respect to such securities and with the requirements of any stock exchange or market system upon which the Stock may then be listed. No Stock will be issued hereunder if such issuance would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, Stock will not be issued hereunder unless (a) a registration statement under the Securities Act (the “Act”) is at the time of issuance in effect with respect to the Shares issued or (b) in the opinion of legal counsel to the Company, the Shares issued may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Act. The Company hereby covenants and agrees that it shall use its commercially reasonable efforts to register the shares issuable under this Award on a Form S-8 within twenty (20) business days following the Grant Date. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any Shares subject to the Award will relieve the Company of any liability in respect of the failure to issue such Shares as to which such requisite authority has not been obtained; provided, however, that in such event, the Company shall settle the vested portion of this Award through payment of cash having a Fair Market Value equal to the number of shares otherwise issuable. As a condition to any issuance hereunder, the Company may require you to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect to such compliance as may be requested by the Company. From time to time, the Board and appropriate officers of the Company are authorized to take the actions necessary and appropriate to file required documents with governmental authorities, stock exchanges, and other appropriate Persons to make Shares available for issuance.

10.Right of the Company and Affiliates to Terminate Employment or Services. Nothing in this Agreement confers upon you the right to continue in the employ of or performing services for the Company or any of its Affiliates, or interfere in any way with the rights of the Company or any of its Affiliates to terminate your employment or service relationship at any time. For purposes of this Agreement, you shall be considered to be in Service as long as you remain in Service or in the service of a corporation or a parent or subsidiary of such corporation assuming or substituting a new award for this Award.

11.Corporate Acts. The existence of the RSUs shall not affect in any way the right or power of the Board or the stockholders of the Company to make or authorize any adjustment, recapitalization,

EXHIBIT 10.1

reorganization, or other change in the Company’s capital structure or its business, any merger or consolidation of the Company, any issue of debt or equity securities, the dissolution or liquidation of the Company or any sale, lease, exchange, or other disposition of all or any part of its assets or business, or any other corporate act or proceeding.

12.Furnish Information. You agree to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirements imposed upon the Company by or under any applicable statute or regulation.

13.Remedies. The parties to this Agreement shall be entitled to recover from each other reasonable attorneys’ fees incurred in connection with the successful enforcement of the terms and provisions of this Agreement whether by an action to enforce specific performance or for damages for its breach or otherwise.

14.No Liability for Good Faith Determinations. The members of the Board shall not be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the RSUs granted hereunder.

15.Execution of Receipts and Releases. Any payment of cash or any issuance or transfer of Shares or other property to you, or to your legal representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full satisfaction of all claims of such Persons hereunder. The Company may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

16.No Guarantee of Interests. The Committee, the Board and the Company do not guarantee the Stock of the Company from loss or depreciation.

17.Notice. All notices required or permitted under this Agreement must be in writing and personally delivered or sent by mail and shall be deemed to be delivered on the date on which it is actually received by the person to whom it is properly addressed or if earlier the date it is sent via certified United States mail.

18.Waiver of Notice. Any person entitled to notice hereunder may waive such notice in writing.

19.Information Confidential. As partial consideration for the granting of the Award hereunder, you hereby agree to keep confidential all information and knowledge, except that which has been disclosed in any public filings required by law, that you have relating to the terms and conditions of this Agreement; provided, however, that such information may be disclosed as required by law and may be given in confidence to your spouse and tax and financial advisors. In the event any breach of this promise comes to the attention of the Company, it shall take into consideration that breach in determining whether to recommend the grant of any future similar award to you, as a factor weighing against the advisability of granting any such future award to you.

20.Successors. This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Company, its successors and assigns.

21.Severability. If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal or invalid provision had never been included herein.

EXHIBIT 10.1

22.Company Action. Any action required of the Company shall be by resolution of the Board or by a person or entity authorized to act by resolution of the Board.

23.Headings. The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.

24.Governing Law. All questions arising with respect to the provisions of this Agreement shall be determined by application of the laws of Delaware without giving any effect to any conflict of law provisions thereof, except to the extent Delaware state law is preempted by federal law. The obligation of the Company to sell and deliver Stock hereunder is subject to applicable laws and to the approval of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Stock.

25.Amendment. This Agreement may be amended in writing, signed by you and the Company.

26.Clawback. To the extent required by applicable law or any applicable securities exchange listing standards, or as otherwise determined by the Board (or a committee thereof), all Shares granted and cash awarded under this Agreement shall be subject to the provisions of any applicable clawback policies or procedures adopted by the Company, which clawback policies or procedures may provide for forfeiture and/or recoupment of such Shares and cash. Notwithstanding any provision of this Agreement to the contrary, the Company reserves the right, without your consent, to adopt any such clawback policies and procedures, including such policies and procedures applicable to this Agreement with retroactive effect.

27.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an original and all of which together shall constitute one instrument. Delivery of an executed counterpart of this Agreement by facsimile or portable document format (.pdf) attachment to electronic mail shall be effective as delivery of a manually executed counterpart of this Agreement.

28.Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, you agree, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports and all other forms of communications) in connection with this and any other award made or offered by the Company. Electronic delivery may be via a Company electronic mail system or by reference to a location on a Company intranet to which you have access. You hereby consent to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that your electronic signature is the same as, and shall have the same force and effect as, your manual signature.

29.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 the Award granted hereby; provided, however, that the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any employment, consulting and/or severance agreement between the Company (or a Company Affiliate or other entity) and you (including the Employment Agreement) in effect as of the date a determination is to be made under this Agreement. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect.

30.Acknowledgements Regarding Section 409A of the Code. This Agreement is intended to comply with section 409A of the Code and the guidance and regulations promulgated thereunder (“Section 409A”) or an exemption thereunder and shall be construed and interpreted in a manner that is consistent

EXHIBIT 10.1

with the requirements for avoiding additional taxes or penalties under Section 409A. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A, and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by you on account of non-compliance with Section 409A. Notwithstanding the foregoing, you acknowledge that if you are deemed a “specified employee” within the meaning of Section 409A, as determined by the Committee, at a time when you become eligible for settlement of the RSUs upon “separation from service” within the meaning of Section 409A, then to the extent this Agreement provides for “nonqualified deferred compensation” and to the extent necessary to prevent any accelerated or additional tax under Section 409A, such settlement will be delayed until the earlier of: (a) the date that is six months following your separation from service and (b) your death. All installment payments under this Agreement will be deemed separate payments for purposes of Section 409A.

[Signature Page Follows]

EXHIBIT 10.1

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its officer thereunto duly authorized, and the Grantee has set his hand as of the Grant Date.

EXTRACTION OIL & GAS, INC.

By: /s/ Eric J. Christ

Name: Eric J. Christ

Title: Vice President, General Counsel & Corporate Secretary

THOMAS B. TYREE, JR.

/s/ Thomas B. Tyree, Jr.

Signature Page

Restricted Stock Unit (RSU) Agreement

EXHIBIT 10.1

APPENDIX A

PERFORMANCE GOALS

The vesting of your Performance-Based RSUs shall be determined by a weighting of the following performance goals as further described below: (i) absolute total stockholder return (“ATSR”) and (ii) relative total stockholder return, as compared to the Company’s Peer Group (“RTSR”), each as defined and detailed below. The performance periods for the Performance-Based RSUs shall begin and end on the various dates set forth in the table below (the “Performance Periods”).

The target number of Performance-Based RSUs shall be 1,250,000. Up to but no more than 200% of the Performance-Based RSUs can become vested (i.e., 2,500,000 Performance-Based RSUs at maximum achievement levels).

Vesting Eligibility

The Performance-Based RSUs shall be eligible to vest in accordance with performance for the Performance Periods set forth below; provided, however, that, except as set forth in the Agreement, none of the Performance-Based RSUs shall vest unless you continue in Service through the third anniversary of the Grant Date:


Amount of Target Number of Performance-Based RSUs Eligible to Vest	Maximum Number of Performance-Based RSUs Eligible to Vest	Performance Period Start Date	Performance Period End Date
25%	50%	March 9, 2020	December 31, 2020
25%	50%	January 1, 2021	December 31, 2021
25%	50%	January 1, 2022	December 31, 2022
25%	50%	March 9, 2020	December 31, 2022

Absolute Total Stockholder Return

The Company’s ATSR, as set forth below, shall determine the vesting of 50% of your target number of Performance-Based RSUs. For ATSR performance between Below Threshold and Threshold, between Threshold and Target, between Target and Stretch, and between Stretch and Maximum, the number of Performance-Based RSUs that vest shall be determined by straight-line interpolation. The Committee will review, analyze and certify the achievement of the Company’s performance under the ATSR goal for the Performance Period, and will determine whether the ATSR performance vesting requirement for your Performance-Based RSUs has been met in accordance with the terms of this Agreement.

Company ATSR Performance and Payout Schedule


Performance	Company’s Annual ATSR Performance	Percent of Target Number of ATSR Performance-Based RSUs to Become Vested
Below Threshold	Less than or equal to 0% Annual ATSR	0%
Threshold	5% Annual ATSR	25%
Target	10% Annual ATSR	50%
Stretch	17.5% Annual ATSR	75%
Maximum	Greater than 25% ATSR	100%

Determination of ATSR

The annual ATSR for each of the Performance Periods is determined by dividing (i) the sum of the cumulative amount of the Company’s dividends per Share for each year during the applicable Performance Period and the arithmetic average per Share closing price of the Stock for the last 20 consecutive trading

EXHIBIT 10.1

days the applicable Performance Period minus the arithmetic average per Share closing price of the Stock for the last 20 consecutive trading days prior to the beginning of the applicable Performance Period; by (ii) the arithmetic average per Share closing price of the Stock for the last 20 consecutive trading days prior to the beginning of the applicable Performance Period. With respect to the Performance Period with a duration of three years, that quotient is then divided by three to produce an annual ATSR.

Relative Total Stockholder Return

The percentile rank that the Company achieves under the RTSR Performance Goal, as set forth below, shall determine the vesting of 50% of your target number of Performance-Based RSUs. For RTSR performance between Below Threshold and Threshold, between Threshold and Target, between Target and Stretch, and between Stretch and Maximum, the number of Performance-Based RSUs that vest shall be determined by straight-line interpolation. The Committee will review, analyze and certify the achievement of the Company’s performance ranking for the RTSR goal for the Performance Period, and will determine whether the RTSR performance vesting requirement for your Performance-Based RSUs has been met in accordance with the terms of this Agreement.

Company RTSR Performance Ranking and Payout Schedule


Performance	Company’s RTSR Performance (Percentile Ranking)	Percent of Target Number of RTSR Performance-Based RSUs to Become Vested
Below Threshold	Lowest Ranking	0%
Threshold	25th Percentile	25%
Target	50th Percentile	50%
Stretch	75th Percentile	75%
Maximum	Highest Ranking	100%

Company Peer Group

The following companies will be deemed to be the Company’s “Peer Group” for purposes of this Agreement:


Ticker Symbol			Name
BRY			Berry Petroleum Corporation
BCEI			Bonanza Creek Energy, Inc.
CRC			California Resources Corporation
CPE			Callon Petroleum Company
DNR			Denbury Resources Inc.
GPOR			Gulfport Energy Corporation
HPR			HighPoint Resources Corporation
LPI			Laredo Petroleum, Inc.
MR			Montage Resources Corporation
OAS			Oasis Petroleum, Inc.
PVAC			Penn Virginia Corporation
QEP			QEP Resources, Inc.
SD			SandRidge Energy, Inc.
SBOW			SilverBow Resources, Inc.
WLL			Whiting Petroleum Corporation

EXHIBIT 10.1

If a company ceases to be publicly traded at any time during the Performance Period, it shall be removed from the Peer Group, and the definition of “Peer Group” shall be adjusted to omit such company. Notwithstanding anything else in this Appendix to the contrary, if a company in the Peer Group files for bankruptcy at any time during the Performance Period, such company will remain in the Peer Group and the total stockholder return of such company for the Performance Period shall be deemed to be negative 100%.

Determination of RTSR Rank

For each of the Performance Periods, the RTSR for the Company and each member of the Peer Group for the entire Performance Period is determined by dividing (i) the sum of the cumulative amount of such entity’s dividends per share for the applicable Performance Period and the arithmetic average per share closing price of such entity’s common stock for the last 20 consecutive trading days of the applicable Performance Period minus the arithmetic average per share closing price of such entity’s common stock for the last 20 consecutive trading days prior to the beginning of the applicable Performance Period; by (ii) the arithmetic average per share closing price of such entity’s common stock for the last 20 consecutive trading days prior to the beginning of the applicable Performance Period. To determine the Company’s percentile ranking for the applicable Performance Period, total stockholder returns are calculated for the Company and each entity in the Peer Group. The entities are arranged by their respective total stockholder returns (highest to lowest) and the Company is ranked within the Peer Group. The RTSR percentile is then calculated as 100 multiplied by a fraction, the numerator of which is one plus the number of companies that are ranked lower than the Company by their respective total stockholder returns and the denominator of which is one plus the number of companies in the Peer Group at the time of the determination.

EXHIBIT 10.2

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made by and between Extraction Oil & Gas, Inc., a Delaware corporation (the “Company”), and Thomas B. Tyree, Jr. (“Executive”) effective March 4, 2020 (the “Effective Date”).

W I T N E S S E T H:

WHEREAS, the Company desires to employ Executive on the terms and conditions, and for the consideration, hereinafter set forth and Executive desires to be employed by the Company on such terms and conditions and for such consideration.

NOW, THEREFORE, for and in consideration of the mutual promises, covenants and obligations contained herein, the Company and Executive agree as follows:

ARTICLE I

DEFINITIONS

In addition to the terms defined in the body of this Agreement, for purposes of this Agreement, the following capitalized words shall have the meanings indicated below:

1.1 “Average Annual Bonus” shall mean the average Annual Bonus paid (or payable) for the two calendar years (or if Executive was employed for less than two full calendar years such lesser number of full calendar years for which Executive was employed) preceding the Date of Termination. In the event that Executive’s employment is terminated prior to December 31, 2020, Average Annual Bonus shall mean Executive’s target Annual Bonus for the 2020 calendar year.

1.2 “Board” shall mean the Board of Directors of the Company.

1.3 “Cause” shall mean a determination by the Board (or its delegate) that Executive (a) has engaged in gross negligence or willful misconduct in the performance of Executive’s duties with respect to the Company or any of its affiliates, (b) has materially breached any provision of this Agreement, (c) has committed an act of theft, fraud, embezzlement, misappropriation or willful breach of a fiduciary duty to the Company or any of its affiliates, or (d) has been convicted of, pleaded no contest to or received adjudicated probation or deferred adjudication in connection with a crime involving fraud, dishonesty or moral turpitude or any felony (or a crime of similar import in a foreign jurisdiction). In order to terminate Executive’s employment for Cause, the Board (or its delegate) must provide Executive with a written notice providing in reasonable detail the specific circumstances alleged to constitute Cause and Executive must not have cured or remedied the alleged Cause event (if susceptible to cure) in the Board’s (or its delegate) good faith judgment within thirty (30) days after his receipt of such notice.

1.4 “Change in Control” shall mean:

(a) a merger of the Company with another entity, a consolidation involving the Company, or the sale of all or substantially all of the assets of the Company to another entity if, in any such case, (i) the holders of equity securities of the Company immediately prior to such transaction or event do not beneficially own immediately after such transaction or event equity securities of the resulting entity entitled to 50% or more of the votes then eligible to be cast in the election of directors generally (or comparable governing body) of the resulting entity in substantially the same proportions that they owned the equity securities of the Company immediately prior to such transaction or event or (ii) the persons who were members of the Board immediately prior to such transaction or event shall not constitute at least a majority of the board of directors of the resulting entity immediately after such transaction or event;

EXHIBIT 10.2

(b) the dissolution or liquidation of the Company;

(c) when any person or entity, including a “group” as contemplated by section 13(d)(3) of the Securities Exchange Act of 1934, as amended, acquires or gains ownership or control (including, without limitation, power to vote) of more than 50% of the combined voting power of the outstanding securities of the Company; or

(d) as a result of or in connection with a contested election of directors, the persons who were members of the Board immediately before such election shall cease to constitute a majority of the Board.

For purposes of the preceding sentence, (i) “resulting entity” in the context of a transaction or event that is a merger, consolidation or sale of all or substantially all assets shall mean the surviving entity (or acquiring entity in the case of an asset sale) unless the surviving entity (or acquiring entity in the case of an asset sale) is a subsidiary of another entity and the holders of common stock of the Company receive capital stock of such other entity in such transaction or event, in which event the resulting entity shall be such other entity, and (ii) subsequent to the consummation of a merger or consolidation that does not constitute a Change in Control, the term “Company” shall refer to the resulting entity and the term “Board” shall refer to the board of directors (or comparable governing body) of the resulting entity.

1.5 “Code” shall mean the Internal Revenue Code of 1986, as amended.

1.6 “Date of Termination” shall mean the date Executive’s employment with the Company is considered to have terminated pursuant to Section 3.5.

1.7 “Disability” shall mean Executive being unable to perform Executive’s duties or fulfill Executive’s obligations under this Agreement by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than six months as determined by the Company and certified in writing by a competent medical physician selected by the Company.

1.8 “Good Reason” shall mean the occurrence of any of the following events:

(a) a material diminution in Executive’s Base Salary; or

(b) a material diminution in Executive’s authority, duties, or responsibilities; or

(c) the involuntary relocation of the geographic location of Executive’s principal place of employment by more than 50 miles from the location of Executive’s principal place of employment as of March 9, 2020 (the “Start Date”); or

(d) a material breach by the Company of this Agreement.

Notwithstanding the foregoing provisions of this Section 1.8 or any other provision in this Agreement to the contrary, any assertion by Executive of a termination of employment for “Good Reason” shall not be effective unless all of the following conditions are satisfied: (i) the condition described in Section 1.8(a), (b) or (c) giving rise to Executive’s termination of employment must have arisen without Executive’s consent; (ii) Executive must provide written notice to the Company of such condition in accordance with Section 11.1 within 45 days of the later of the initial existence of the condition or when Executive first learns of the existence of the condition (provided that such notice, if provided within 45 days of when Executive first learns of the existence of the condition, must in all circumstances be provided no

EXHIBIT 10.2

later than 90 days following the initial existence of the condition); (iii) the condition specified in such notice must remain uncorrected for 30 days after receipt of such notice by the Company; and (iv) the date of Executive’s termination of employment must occur within 90 days after the initial existence of the condition specified in such notice or when Executive first learns of the existence of the condition (provided, however, that such termination may in no circumstance occur later than two years following the initial existence of the condition).

1.9 “Notice of Termination” shall mean a written notice delivered to the other party indicating the specific termination provision in this Agreement relied upon for termination of Executive’s employment and the intended Date of Termination and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated.

1.10 “Section 409A” shall mean section 409A of the Code and the Treasury Regulations and other interpretative guidance issued thereunder.

1.11 “Section 409A Payment Date” shall mean the earlier of (a) the date of Executive’s death or (b) the date that is six months after the date of termination of Executive’s employment with the Company.

ARTICLE II

EMPLOYMENT AND DUTIES

2.1 Employment; Start Date. The Company agrees to employ Executive, and Executive agrees to be employed by the Company, pursuant to the terms of this Agreement beginning as of the Start Date and continuing for the period of time set forth in Article III of this Agreement, subject to the terms and conditions of this Agreement.

2.2 Positions. From and after the Start Date, the Company shall employ Executive in the position of Executive Chairman of the Company or in such other position or positions as the parties may mutually agree, and Executive shall report to the Board.

2.3 Duties and Services. Executive agrees to serve in the position referred to in Section 2.2 and to perform diligently and to the best of Executive’s abilities the duties and services appertaining to such position, as well as (a) such additional reasonably specific duties and services that Executive from time to time may be reasonably directed to perform by the Company that are reasonably consistent with such position, and (b) such additional duties and services appropriate to such position(s), which the parties mutually agree upon from time to time.

2.4 Other Interests. Executive agrees, during the period of Executive’s employment by the Company, to devote sufficient business time and attention to fulfill his duties for the position referred to in Section 2.2. In addition, the parties acknowledge and agree that Executive may (a) engage in and manage Executive’s passive personal investments, (b) continue to engage in the professional, charitable and civic activities in which Executive is engaged as of the date hereof, including service as a member of (i) the Board of Directors of Antero Resources Corporation, (ii) the Board of Directors of Northwoods Energy LLC (as Chairman), (iii) the Colgate University Board of Trustees, and (iv) the Strategic Advisory Group of Goldman Sachs Merchant Bank, (c) continue to be employed by Northwoods Energy LLC until April 1, 2020, (d) in the future provide services to, and invest in, Project Canary, Inc., and (e) engage in future charitable, civic or professional activities, subject to the Board’s approval, which such approval shall not be unreasonably withheld, conditioned or delayed.

EXHIBIT 10.2

In keeping with these duties, Executive shall make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not appropriate for Executive’s own benefit business opportunities concerning the subject matter of the fiduciary relationship.

ARTICLE III

TERM AND TERMINATION OF EMPLOYMENT

3.1 Term. Unless sooner terminated pursuant to other provisions hereof, the Company agrees to continue to employ Executive for the period beginning on the Start Date and ending on the third anniversary of the Start 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 under this Agreement has not been terminated pursuant to Section 3.2 or 3.3, then said term of employment shall automatically be extended for successive one-year periods unless on or before the date that is 90 days prior to the first day of any such extension period either party shall give written notice to the other that no such automatic extension shall occur, in which case the term of employment shall terminate as of the end of the current term.

3.2 Company’s Right to Terminate. Notwithstanding the provisions of Section 3.1, the Company may terminate Executive’s employment under this Agreement at any time for any of the following reasons by providing Executive with a Notice of Termination:

(a) Executive’s Disability; or

(b) Executive’s death; or

(d) for any other reason whatsoever or for no reason at all, in the sole discretion of the Company.

3.3 Executive’s Right to Terminate. Notwithstanding the provisions of Section 3.1, Executive shall have the right to terminate Executive’s employment under this Agreement for Good Reason or for any other reason whatsoever or for no reason at all, in the sole discretion of Executive, by providing the Company with a Notice of Termination. In the case of a termination of employment by Executive pursuant to this Section 3.3, the Date of Termination specified in the Notice of Termination shall not be less than 15 nor more than 60 days, respectively, from the date such Notice of Termination is given, and the Company may require a Date of Termination earlier than that specified in the Notice of Termination (and, if such earlier Date of Termination is so required, it shall not change the basis for Executive’s termination nor be construed or interpreted as a termination of employment pursuant to Section 3.1 or Section 3.2).

3.4 Deemed Resignations. Unless otherwise agreed to in writing by the Company or the Company and Executive prior to the termination of Executive’s employment, any termination of Executive’s employment shall constitute (a) an automatic resignation of Executive from the Board, from the board of directors of any affiliate of the Company and from the board of directors or similar governing body of any corporation, limited liability entity or other entity in which the Company or any affiliate holds an equity interest and with respect to which board or similar governing body Executive serves as the Company’s or such affiliate’s designee or other representative and (b) an automatic resignation of Executive as an officer of the Company and each affiliate of the Company (if applicable).

3.5 Meaning of Termination of Employment. For all purposes of this Agreement, Executive shall be considered to have terminated employment with the Company when Executive incurs a “separation from service” with the Company within the meaning of Section 409A.

EXHIBIT 10.2

ARTICLE IV

COMPENSATION AND BENEFITS

4.1 Base Salary. During the term of this Agreement, Executive shall receive a minimum, annualized base salary of $450,000 (the “Base Salary”). Executive’s annualized base salary shall be reviewed periodically by the Board (or a committee thereof) and, in the sole discretion of the Board (or a committee thereof), such annualized base salary may be increased (but not decreased) effective as of any date determined by the Board (or a committee thereof). Executive’s 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. Executive shall be eligible to receive an annual, calendar-year bonus (payable in a single lump sum) based on criteria determined in the discretion of the Board or a committee thereof in consultation with executive management of the Company (the “Annual Bonus”), it being understood that (a) the target bonus at planned or targeted levels of performance shall equal no less than 100% of Executive’s Base Salary and (b) the actual amount of each Annual Bonus shall be determined in the discretion of the Board or a committee thereof. Notwithstanding the foregoing, the Annual Bonus payable with respect to the 2020 calendar year shall not be pro-rated for any partial year of performance. The Company shall use commercially reasonable efforts to pay each Annual Bonus with respect to a calendar year on or before March 15 of the following calendar year (and in no event shall an Annual Bonus be paid after December 31 of the following calendar year); provided, however, that (except as otherwise provided in Section 5.3) Executive will be entitled to receive payment of such Annual Bonus only if Executive is employed by the Company on such date of payment.

4.3 Equity Award. Commencing in 2020, Executive shall be eligible to receive an annual performance-based equity award under the Company’s then existing incentive equity plan based on vesting criteria determined in the discretion of the Board or a committee thereof in consultation with the Company’s executive management. For the 2020 calendar year, Executive’s equity award shall have an approximate grant date fair value equal to $1,800,000.00 (the “2020 Award”). The 2020 Award (i) shall be granted to Executive at the same time the Company grants equity awards to its other senior executives; (ii) shall not be pro-rated for any partial year of performance; and (iii) shall be comprised of equity awards of the same type as those granted to the Company’s Chief Executive Officer. For each year thereafter, Executive’s annual performance-based equity award shall have a target grant date fair value equal to at least 450% of Executive’s Base Salary. Executive’s entitlement to any equity award remains subject to approval by the Board or a committee thereof.

4.4 Other Benefits. During Executive’s employment hereunder, Executive shall be allowed to participate in all benefit plans and programs of the Company, including improvements or modifications of the same, which are now, or may hereafter be, available to the Chief Executive Officer and other senior executives of the Company. If, however, during Executive’s employment hereunder, Executive elects not to participate in the Company’s medical insurance benefit plan and chooses, instead, to maintain Executive’s existing medical insurance coverage, the Company shall reimburse Executive for Executive’s out-of-pocket medical insurance premium costs for such existing medical insurance coverage as of immediately before the Start Date; provided, however, that if the Company’s payment under this Section 4.4 would violate the nondiscrimination rules under the ACA or any similar law, or result in the imposition of penalties under the ACA or any similar law, Executive will not be entitled to any such payment. Such reimbursement shall be made by the Company on a monthly basis. The Company shall not, however, by reason of this Section 4.4, be obligated to institute, maintain, or refrain from changing, amending, or discontinuing, any such benefit plan or program, so long as such changes are similarly applicable to other senior executives generally.

4.5 Expenses. The Company shall reimburse Executive for all reasonable business expenses incurred by Executive in performing services hereunder, including all expenses of travel and living expenses

EXHIBIT 10.2

while away from home on business or at the request of and in the service of the Company; provided, in each case, that such expenses are incurred and accounted for in accordance with the policies and procedures established by the Company. For the avoidance of doubt, such business expenses shall include business class travel, Executive’s attendance at conferences on behalf of the Company and cell phone expense reimbursement. Any such reimbursement of expenses shall be made by the Company upon or as soon as practicable following receipt of supporting documentation reasonably satisfactory to the Company (but in any event not later than the close of Executive’s taxable year following the taxable year in which the expense is incurred by Executive).

4.6 Vacation and Sick Leave. During Executive’s employment hereunder, Executive shall be entitled to sick and vacation leave in accordance with the Company’s policies applicable to its Chief Executive Officer and other senior executives, which leave shall accrue and be taken in accordance with the Company’s sick and vacation policies in effect from time to time. Executive’s right to carry over unused vacation from one calendar year to the next shall be determined by the Company’s vacation policy.

4.7 Offices. Subject to Articles II, III, and IV hereof, Executive agrees to serve without additional compensation, if elected or appointed thereto, as a director of any of the Company’s affiliates and as a member of any committees of the board of directors of any such entities, and in one or more executive positions of any of the Company’s affiliates.

4.8 D&O Insurance; Indemnification. The Company shall provide Executive with contractual indemnification rights and directors’ and officers’ insurance coverage equivalent to those contractual indemnification rights and directors’ and officers’ insurance coverage provided to the Chief Executive Officer and other senior executive officers of the Company.

ARTICLE V

EFFECT OF TERMINATION OF EMPLOYMENT ON COMPENSATION

5.1 For Cause; Without Good Reason; Certain Non-Renewals. If Executive’s employment hereunder shall terminate (a) at the expiration of the term provided in Section 3.1 (other than as provided under Section 5.3 below), (b) pursuant to Section 3.2(c), or (c) pursuant to Executive’s resignation for other than Good Reason, then all compensation and all benefits to Executive hereunder shall terminate contemporaneously with such termination of employment, except that Executive shall be entitled to (i) payment of all accrued and unpaid Base Salary to the Date of Termination, (ii) reimbursement for all incurred but unreimbursed expenses for which Executive is entitled to reimbursement in accordance with Section 4.5, and (iii) benefits to which Executive is entitled under the terms of any applicable benefit plan or program (such amounts set forth in (i), (ii), and (iii) shall be collectively referred to herein as the “Accrued Rights”).

5.2 Death; Disability. If Executive’s employment hereunder shall terminate on account of his Disability or death pursuant to Section 3.2(a) or (b), then all compensation and all benefits to Executive hereunder shall terminate contemporaneously with such termination of employment, except that Executive (or Executive’s legal representative, estate, and/or beneficiaries, as the case may be) shall be entitled to receive:

(a) the Accrued Rights;

(b) a cash payment in an amount equal to one times the sum of (i) Executive’s Base Salary as of the Date of Termination and (ii) the Average Annual Bonus, which amount shall be paid in a lump sum cash payment on the date that is 60 days after the Date of Termination; and

EXHIBIT 10.2

(c) accelerated vesting of any outstanding equity-related awards held by Executive with respect to time-based vesting provisions (with any performance-based vesting being determined based on actual performance through the end of the performance period).

5.3 Without Cause; for Good Reason; Certain Non-Renewals. If Executive’s employment hereunder shall terminate at the expiration of the term provided in Section 3.1 due to a non-extension of the Agreement by the Company, pursuant to Executive’s resignation for Good Reason, or by action of the Company pursuant to Section 3.2 for any reason other than those encompassed by Section 3.2(a), 3.2(b), or 3.2(c), then all compensation and all benefits to Executive hereunder shall terminate contemporaneously with such termination of employment, except that Executive shall be entitled to receive the Accrued Rights and, subject to Executive’s delivery, within 50 days after the Date of Termination, and non-revocation of an executed release in a form reasonably satisfactory to the Company (which shall release and discharge the Company and its affiliates, subsidiaries and benefit plans, and their respective stockholders, officers, directors, members, partners, employees, agents representatives and other affiliated persons from any and all claims or causes of action of any kind or character, including but not limited to all claims or causes of action arising out of Executive’s employment with the Company or its affiliates or the termination of such employment) (the “Release”), Executive shall receive the following additional compensation and benefits from the Company, as applicable, (but no other additional compensation or benefits after such termination):

(a) Unpaid Prior Year Annual Bonus: The Company shall pay to Executive any earned but unpaid Annual Bonus for the calendar year ending prior to the Date of Termination, which amount shall be payable in a lump sum on or before the date such annual bonuses are paid to executives who have continued employment with the Company (but in no event earlier than 60 days after the Date of Termination or later than December 31^st of the calendar year in which the Date of Termination occurs);

(b) Prorated Current Year Annual Bonus: The Company shall pay to Executive a bonus for the calendar year in which the Date of Termination occurs in an amount equal to the greater of the (A) Annual Bonus for the immediately prior completed year and (B) Executive’s target bonus opportunity for the year including the Date of Termination, which amount shall be prorated through and including the Date of Termination (based on the ratio of the number of days Executive was employed by the Company during such year to the number of days in such year), payable in a lump sum in the next calendar year on or before the date such annual bonuses are paid to executives who have continued employment with the Company (but in no event earlier than 60 days after the Date of Termination nor later than the March 15 of such next calendar year); provided, however, if Executive’s Date of Termination occurs prior to December 31, 2020, the bonus payable pursuant to this Section 5.3(b) will not be prorated.

(c) Severance Payment: The Company shall pay to Executive a severance amount equal to two times the sum of (i) Executive’s Base Salary as of the Date of Termination and (ii) the Average Annual Bonus, which amount shall be paid in a lump sum payment on the date that is 60 days after the Date of Termination occurs; provided, however, that in the event that Executive’s Date of Termination under this Section 5.3(c) occurs within twelve (12) months following a Change in Control, such severance amount shall equal three times the sum of clauses (i) and (ii) of this Section 5.3(c);

(d) Post-Employment Health Coverage: During the period following the Date of Termination until the date that Executive first becomes eligible for medical insurance coverage under Medicare, the Company shall continue to provide medical insurance coverage to Executive and his spouse and eligible dependents at the same cost to Executive as immediately prior to the Date of Termination; provided, however, that in the event that Executive becomes eligible for group health coverage from a subsequent employer, the continued medical insurance coverage provided by the Company under this Section 5.3(d) shall immediately cease. Notwithstanding the foregoing, if the Company’s payment under this Section 5.3(d) would violate the nondiscrimination rules under the ACA or any similar law, or result in the imposition of penalties under the ACA or any similar law, Executive will not be entitled to any such

EXHIBIT 10.2

payment; provided, however, that in such event, the Company shall use reasonable best efforts to secure comparable coverage for Employee and the Employee’s spouse and eligible dependents for the coverage period set forth above, and shall in all events pay to Executive an amount each month such that Executive’s cost of subsequent coverage for the coverage period above is the same as Executive’s cost immediately prior to the Date of Termination; and

(e) Equity Awards: Notwithstanding anything to the contrary included in any award agreement, 100% of outstanding equity-related awards held by Executive shall immediately vest with respect to time-based vesting provisions (and, unless more favorable vesting is provided in any award agreement, any performance-based awards will vest based on actual performance through the end of any completed performance period and will vest based on actual level of achievement of all relevant performance goals against target through the end of any incomplete performance period); provided, however, that in the event that Executive’s Date of Termination under this Section 5.3(e) occurs in connection with a Change in Control, any outstanding performance-based awards will vest based on (1) actual performance through the end of any completed performance period and (2) the greater of (A) an assumed achievement of all relevant performance goals at the “target” level or (B) the actual level of achievement of all relevant performance goals against target as of the Company’s fiscal quarter end before the Change in Control for any incomplete performance period.

ARTICLE VI

PROTECTION OF INFORMATION

6.1 Disclosure to and Property of the Company. For purposes of this Article VI, the term “the Company” shall include the Company and any of its affiliates, and any reference to “employment” or similar terms shall include a director and/or consulting relationship. All information, trade secrets, designs, ideas, concepts, improvements, product developments, discoveries and inventions, whether patentable or not, that are conceived, made, developed, disclosed to 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 the Company’s or any of its affiliates’ businesses, trade secrets, products or services (including, without limitation, all such information relating to corporate opportunities, strategies, business plans, product specifications, 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 the customer’s organizations or within the organization of acquisition prospects, or production, marketing and merchandising techniques, prospective names and marks) and all writings or materials of any type embodying any of such information, ideas, concepts, improvements, discoveries, inventions and other similar forms of expression (collectively, “Confidential Information”) shall be disclosed to the Company and are and shall be the sole and exclusive property of the Company or its affiliates, as applicable. 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 (or its affiliates). Executive agrees to perform all actions reasonably requested by the Company or its affiliates to establish and confirm such exclusive ownership. Upon termination of Executive’s employment with the Company, for any reason, Executive promptly shall deliver such Confidential Information and Work Product, and all copies thereof, to the Company.

EXHIBIT 10.2

(or its affiliates); and has and will place Executive in a position to develop business good will on behalf of the Company (or its affiliates).

6.3 No Unauthorized Use or Disclosure.

(a) Executive agrees to preserve and protect the confidentiality of all Confidential Information and Work Product of the Company and its affiliates. Executive agrees that Executive will not, at any time during or after Executive’s employment with the Company, make any unauthorized disclosure of, and Executive shall not remove from the Company premises, Confidential Information or Work Product of the Company or its affiliates, or make any use thereof, except, in each case, in the carrying out of Executive’s responsibilities hereunder. Executive shall use all reasonable efforts to cause all persons or entities to whom any Confidential Information shall be disclosed by Executive hereunder to preserve and protect the confidentiality of such Confidential Information.

(b) Executive shall have no obligation hereunder to keep confidential any Confidential Information if and to the extent 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.

(c) At the request of the Company at any time, Executive agrees to deliver to the Company all Confidential Information that Executive may possess or control. Executive agrees that all Confidential Information of the Company (whether now or hereafter existing) conceived, discovered or made by Executive during the period of Executive’s employment by the Company exclusively belongs to the Company (and not to Executive), and upon request by the Company for specified Confidential Information, 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 Article VI. As a result of Executive’s employment by the Company, 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 the Company and its affiliates. Executive also agrees to preserve and protect the confidentiality of such third party Confidential Information and Work Product.

(d) Nothing in this Agreement (including Article VII below) will prevent Executive from: (i) reporting possible violations of applicable law to any governmental agency or entity; or (ii) making disclosures that are protected under the whistleblower provisions of applicable law. For the avoidance of doubt, nothing herein shall prevent Executive from making a disclosure of a trade secret that: (A) is made in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, an individual who files a lawsuit for retaliation by an employer of reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (X) files any document containing the trade secret under seal; and (Y) does not disclose the trade secret, except pursuant to court order.

EXHIBIT 10.2

if the work is prepared by Executive in the scope of Executive’s employment; or, if the work relating to the Company’s business, products, or services 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 a motion picture or other 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 the work relating to the Company’s business, products, or services 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 during Executive’s employment by the Company, 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.

6.5 Assistance by Executive. During the period of Executive’s employment by the Company, Executive shall assist the Company and its nominee, at any time, in the protection of the Company’s or its affiliates’ worldwide right, title and interest in and to Confidential Information and Work Product and the execution of all formal assignment documents requested by the Company or its nominee(s) and the execution of all lawful oaths and applications for patents and registration of copyright in the United States and foreign countries. For the period of two (2) years after Executive’s employment termination with the Company pursuant to Section 5.3 above, at the request from time to time and expense of the Company or its affiliates, Executive shall assist the Company or its nominee(s) in the protection of the Company’s or its affiliates’ worldwide right, title and interest in and to Confidential Information and Work Product and the execution of all formal assignment documents requested by the Company or its nominee and the execution of all lawful oaths and applications for patents and registration of copyright in the United States and foreign countries. Executive shall assist after Executive’s employment termination with the Company other than pursuant to Section 5.3 above pursuant to mutually agreeable terms between Executive and the Company.

6.6 Remedies. Executive acknowledges that money damages would not be a sufficient remedy for any breach of this Article VI by Executive, and the Company or its affiliates shall be entitled to enforce the provisions of this Article VI by terminating payments or benefits then owing to Executive under Section 5.3 and to specific performance and injunctive relief as remedies for such breach or any threatened breach; provided, that, to the extent the Company receives monetary damages from Executive, such amounts shall not exceed the total value Executive received under Section 5.3. Such remedies shall not be deemed the exclusive remedies for a breach of this Article VI but shall be in addition to all remedies available at law or in equity, including the recovery of damages from Executive and Executive’s agents. However, if it is determined that Executive has not committed a breach of this Article VI, then the Company shall resume the payments and benefits due under this Agreement and pay to Executive and Executive’s spouse, if applicable, all payments and benefits that had been suspended pending such determination.

ARTICLE VII

STATEMENTS CONCERNING THE COMPANY

7.1 Statements Concerning the Company. Subject to Section 6.3(d) above, Executive shall refrain, both during and after the termination of the employment relationship, from publishing any oral or written statements about the Company, any of its affiliates or any of the Company’s or such affiliates’ directors, officers, employees, consultants, agents or representatives that (a) are slanderous, libelous or defamatory, (b) disclose Confidential Information of the Company, any of its affiliates or any of the Company’s or any such affiliates’ business affairs, directors, officers, employees, consultants, agents or representatives, or (c) place the Company, any of its affiliates, or any of the Company’s or any such affiliates’ directors, officers, employees, consultants, agents or representatives in a false light before the public. The Company agrees that the members of the Board and the Company’s named executive officers, while serving in such capacity for the Company, shall not make negative comments about Executive or otherwise disparage Executive in any manner that is likely to be harmful to Executive’s business reputation. The foregoing shall not be violated by truthful statements in response to legal process, required

EXHIBIT 10.2

governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), and the foregoing limitation on the Company’s executives and directors shall not be violated by statements that they in good faith believe are necessary or appropriate to make in connection with performing their duties and obligations to the Company.

7.2 Enforcement Rights. A violation or threatened violation of this Article VII may be enjoined by the courts. The rights afforded the Company and its affiliates under this provision are in addition to any and all rights and remedies otherwise afforded by law.

ARTICLE VIII

NON-COMPETITION AGREEMENT

8.1 Definitions. As used in this Article VIII, the following terms shall have the following meanings:

“Business” means (a) during the period of Executive’s employment by the Company, the core products and services provided by the Company and its affiliates during such period and other products and services that are functionally equivalent to the foregoing, and (b) during the portion of the Prohibited Period that begins on the termination of Executive’s employment with the Company, the products and services provided by the Company and its affiliates at the time of such termination of employment and other products and services that are functionally equivalent to the foregoing.

“Competing Business” means any business, individual, partnership, firm, corporation or other entity which wholly or in any significant part engages in any business competing with the Business in the Restricted Area. In no event will the Company or any of its affiliates be deemed a Competing Business.

“Governmental Authority” means any governmental, quasi-governmental, state, county, city or other political subdivision of the United States or any other country, or any agency, court or instrumentality, foreign or domestic, or statutory or regulatory body thereof.

“Legal Requirement” means any law, statute, code, ordinance, order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization, or other directional requirement (including, without limitation, any of the foregoing that relates to environmental standards or controls, energy regulations and occupational, safety and health standards or controls including those arising under environmental laws) of any Governmental Authority.

“Prohibited Period” means the period during which Executive is employed by the Company hereunder and a period of two years following the termination of Executive’s employment with the Company.

“Restricted Area” means any geographic area within a 100-mile radius of any location where the Company or its affiliates engages in the Business, and for which Executive has or had responsibilities, during the period of Executive’s employment. Notwithstanding the foregoing, Restricted Area shall not include the Powder River Basin for so long as Executive provided services to Northwoods Energy LLC, including but not limited as a member of the Board of Directors of Northwoods Energy LLC.

8.2 Non-Competition; Non-Solicitation. Executive and the Company agree to the non-competition and non-solicitation provisions of this Article VIII in consideration for the Confidential Information provided by the Company to Executive pursuant to Article VI of this Agreement, to protect the trade secrets and confidential information of the Company or its affiliates disclosed or entrusted to Executive by the Company or its affiliates or created or developed by Executive for the Company or its affiliates, to protect the business goodwill of the Company or its affiliates developed through the efforts of

EXHIBIT 10.2

Executive and/or the business opportunities disclosed or entrusted to Executive by the Company or its affiliates and as an additional incentive for the Company to enter into this Agreement.

(a) Subject to the exceptions set forth in Section 8.2(b) below, Executive expressly covenants and agrees that during the Prohibited Period (i) Executive will refrain from carrying on or engaging in, directly or indirectly, any Competing Business in the Restricted Area and (ii) Executive will not, and Executive will cause Executive’s affiliates not to, directly or indirectly, own, manage, operate, join, become an employee of, partner in, owner or member of (or an independent contractor to), control or participate in, be connected with or loan money to, sell or lease equipment or property to, or otherwise be affiliated with any business, individual, partnership, firm, corporation or other entity which engages in a Competing Business in the Restricted Area.

(b) Notwithstanding the restrictions contained in Section 8.2(a), Executive or any of Executive’s affiliates may own an aggregate of not more than 2% of the outstanding stock of any class of any corporation engaged in a Competing Business, if such stock is listed on a national securities exchange or regularly traded in the over-the-counter market by a member of a national securities exchange, without violating the provisions of Section 8.2(a), provided that neither Executive nor any of Executive’s affiliates has the power, directly or indirectly, to control or direct the management or affairs of any such corporation and is not involved in the management of such corporation.

(c) Executive further expressly covenants and agrees that during the Prohibited Period, Executive will not, and Executive will cause Executive’s affiliates not to (i) engage or employ, or solicit or contact with a view to the engagement or employment of, any person who is an officer or employee of the Company or any of its affiliates or (ii) canvass, solicit, approach or entice away or cause to be canvassed, solicited, approached or enticed away from the Company or any of its affiliates any person who or which is a customer of any of such entities during the period during which Executive is employed by the Company.

(d) The restrictions contained in Section 8.2 shall not apply to any product or service that the Company provided during Executive’s employment but that the Company no longer provides at the Date of Termination.

(e) Before accepting employment with any other person or entity while employed by the Company during the Prohibited Period, Executive will inform such person or entity of the restrictions contained in this Article VIII.

8.3 Relief. Executive and the Company agree and acknowledge that the limitations as to time, geographical area and scope of activity to be restrained as set forth in Section 8.2 are reasonable and do not impose any greater restraint than is necessary to protect the legitimate business interests of the Company. Executive and the Company also acknowledge that money damages would not be sufficient remedy for any breach of this Article VIII by Executive, and the Company or its affiliates shall be entitled to enforce the provisions of this Article VIII by terminating payments or benefits then owing to Executive under Section 5.3 and to specific performance and injunctive relief as remedies for such breach or any threatened breach; provided, that, to the extent the Company receives monetary damages from Executive, such amounts shall not exceed the total value Executive received under Section 5.3. Such remedies shall not be deemed the exclusive remedies for a breach of this Article VIII but shall be in addition to all remedies available at law or in equity, including the recovery of damages from Executive and Executive’s agents. However, if it is determined that Executive has not committed a breach of this Article VIII, then the Company shall resume the payments and benefits due under this Agreement and pay to Executive all payments and benefits that had been suspended pending such determination.

8.4 Reasonableness; Enforcement. Executive hereby represents to the Company that Executive has read and understands, and agrees to be bound by, the terms of this Article VIII. Executive acknowledges

EXHIBIT 10.2

that the geographic scope and duration of the covenants contained in this Article VIII are the result of arm’s-length bargaining and are fair and reasonable in light of (a) the nature and wide geographic scope of the operations of the Business, (b) Executive’s level of control over and contact with the Business in all jurisdictions in which it is conducted, (c) the fact that the Business is conducted throughout the Restricted Area and (d) the amount of Confidential Information that Executive is receiving in connection with the performance of Executive’s duties hereunder. It is the desire and intent of the parties that the provisions of this Article VIII be enforced to the fullest extent permitted under applicable Legal Requirements, whether now or hereafter in effect and therefore, to the extent permitted by applicable Legal Requirements, Executive and the Company hereby waive any provision of applicable Legal Requirements that would render any provision of this Article VIII invalid or unenforceable.

8.5 Reformation. The Company and Executive agree that the foregoing restrictions are reasonable under the circumstances and that any breach of the covenants contained in this Article VIII would cause irreparable injury to the Company. Executive understands that the foregoing restrictions may limit Executive’s ability to engage in certain businesses anywhere in the Restricted Area during the Prohibited Period, but acknowledges that Executive will receive sufficient consideration from the Company to justify such restriction. Further, Executive acknowledges that Executive’s skills are such that Executive can be gainfully employed in non-competitive employment, and that the agreement not to compete will not prevent Executive from earning a living. Nevertheless, if any of the aforesaid restrictions are found by a court of competent jurisdiction to be unreasonable, or overly broad as to geographic area or time, or otherwise unenforceable, the parties intend for the restrictions herein set forth to be modified by the court making such determination so as to be reasonable and enforceable and, as so modified, to be fully enforced. By agreeing to this contractual modification prospectively at this time, the Company and Executive intend to make this provision enforceable under the law or laws of all applicable States, Provinces and other jurisdictions so that the entire agreement not to compete and this Agreement as prospectively modified shall remain in full force and effect and shall not be rendered void or illegal. Such modification shall not affect the payments made to Executive under this Agreement.

ARTICLE IX

DISPUTE RESOLUTION

9.1 Arbitration. Except as otherwise provided in this Article IX, any and all claims or disputes between Executive and the Company or its parents, subsidiaries and affiliates (including, without limitation, the validity, scope, and enforceability of this Article IX and claims arising under any federal, state or local law prohibiting discrimination in employment or governing the employment relationship in any way) shall be submitted for final and binding arbitration by a single arbitrator in Denver, Colorado, in accordance with the rules for resolution of employment disputes of the American Arbitration Association (“AAA”). The arbitrator shall have the power to gather such materials, information, testimony, and evidence as he or she deems relevant to the dispute before him or her, and each party will provide such materials, information, testimony, and evidence requested by the arbitrator, except to the extent any information so requested is subject to an attorney-client or other privilege. The arbitrator shall apply the substantive law of the State of Colorado (excluding Colorado choice-of-law principles that might call for the application of some other state’s law), or federal law, or both as applicable to the claims asserted. The results of the arbitration and the decision of the arbitrator will be final and binding on the parties and each party agrees and acknowledges that these results shall be enforceable in a court of law of competent jurisdiction; provided that the parties agree that the arbitrator and any court enforcing the award of the arbitrator shall not have the right or authority to award punitive or exemplary damages to any disputing party. No demand for arbitration may be made after the date when the institution of legal or equitable proceedings based on such claim or dispute would be barred by the applicable statute of limitations. In the event either party must resort to the judicial process to enforce the provisions of this Agreement, the award of an arbitrator, or equitable relief granted by an arbitrator, the party seeking enforcement shall be entitled to recover from the other party all costs of litigation including, but not limited to, reasonable attorney’s fees and court costs. All proceedings conducted

EXHIBIT 10.2

pursuant to this agreement to arbitrate, including any order, decision or award of the arbitrator, shall be kept confidential by all parties. Executive and the Company explicitly recognize that no provision of this Article IX shall prevent either party from seeking to resolve any dispute relating to Article VI or Article VIII of this Agreement in a court of law. Executive and the Company further acknowledge and agree that a court of competent jurisdiction shall have the power to maintain the status quo pending the arbitration of any dispute under this Article IX, and this Article IX shall not require the arbitration of an application for emergency or temporary injunctive relief by either party pending arbitration; provided, however, that the remainder of any such dispute beyond the application for emergency or temporary injunctive relief shall be subject to arbitration under this Article IX.

9.2 Waiver of Jury Trial. EXECUTIVE ACKNOWLEDGES THAT, BY SIGNING THIS AGREEMENT, EXECUTIVE IS WAIVING ANY RIGHT THAT EXECUTIVE MAY HAVE TO A JURY TRIAL OR, EXCEPT AS EXPRESSLY PROVIDED HEREIN, A COURT TRIAL OF ANY CLAIM ALLEGED BY EXECUTIVE.

ARTICLE X

CERTAIN EXCISE TAXES

Notwithstanding anything to the contrary in this Agreement, if Executive is a “disqualified individual” (as defined in section 280G(c) of the Code), and the payments and benefits provided for in this Agreement, together with any other payments and benefits which Executive has the right to receive from the Company or any of its affiliates, would constitute a “parachute payment” (as defined in section 280G(b)(2) of the Code), then the payments and benefits provided for in this Agreement shall be either (a) reduced (but not below zero) so that the present value of such total amounts and benefits received by Executive from the Company and its affiliates will be one dollar ($1.00) less than three times Executive’s “base amount” (as defined in section 280G(b)(3) of the Code) and so that no portion of such amounts and benefits received by Executive shall be subject to the excise tax imposed by section 4999 of the Code, or (b) paid in full, whichever produces the better net after-tax position to Executive (taking into account any applicable excise tax under section 4999 of the Code and any other applicable taxes, including any federal, state, municipal, and local income or employment taxes, and taking into account the phase out of itemized deductions and personal exemptions). The reduction of payments and benefits hereunder, if applicable, shall be made by reducing, first, payments or benefits to be paid in cash hereunder in the order in which such payment or benefit would be paid or provided (beginning with such payment or benefit that would be made last in time and continuing, to the extent necessary, through to such payment or benefit that would be made first in time) and, then, reducing any benefit to be provided in-kind hereunder for which the 280G value is not reduced pursuant to Q/A 24(c) of the 280G Treasury Regulations in a similar order (but excluding from such reduction the continuation coverage provided by Section 5.3(d)), and then, reducing any other benefit to be provided in-kind hereunder in a similar order, in all instances in accordance with Section 409A. The determination as to whether any such reduction in the amount of the payments and benefits provided hereunder is necessary shall be made by the Company in good faith; provided, however, that (a) no portion of Executive’s payments or benefits the receipt or enjoyment of which Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of section 280G(b) of the Code will be taken into account; (b) no portion of Executive’s payments or benefits will be taken into account which, in the opinion of tax counsel (“Tax Counsel”) for the Company does not constitute a parachute payment (including by reason of section 280G(b)(4)(A) of the Code); (c) in calculating the applicable excise tax under section 4999 of the Code, no portion of Executive’s payments or benefits will be taken into account which, in the opinion of Tax Counsel, constitutes reasonable compensation for services actually rendered, within the meaning of section 280G(b)(4)(B) of the Code, in excess of the base amount that is allocable to such reasonable compensation; and (d) the value of any non-cash benefit or any deferred payment or benefit will be determined by Tax Counsel or the Company’s independent auditor in accordance with the principles of sections 280G(d)(3) and (4) of the Code. At the time that payments are made under this Agreement, the Company will provide Executive with a written statement setting forth the manner in

EXHIBIT 10.2

which such payments were calculated and the basis for such calculations, including any opinions or other advice the Company received from Tax Counsel, the Company’s independent auditor, or other advisors or consultants (and any such opinions or advice which are in writing will be attached to the statement). If a reduced payment or benefit is made or provided, and through error or otherwise, that payment or benefit, when aggregated with other payments and benefits from the Company (or its affiliates) used in determining if a “parachute payment” exists, exceeds one dollar ($1.00) less than three times Executive’s base amount, then Executive shall immediately repay such excess to the Company or the applicable affiliate upon notification that an overpayment has been made. The fact that Executive’s right to payments or benefits may be reduced by reason of the limitations contained in this Article X will not limit or otherwise affect any other rights of Executive under this Agreement or otherwise. All determinations required by this Article X will be made at the expense of the Company. However, nothing in this Article X shall require the Company or any affiliate to be responsible for, or have any liability or obligation with respect to, Executive’s excise tax liabilities under section 4999 of the Code.

ARTICLE XI

MISCELLANEOUS

11.1 Notices. For purposes of this Agreement, notices and all other communications provided for herein shall be in writing and shall be deemed to have been duly given (a) when received if delivered personally or by courier, (b) on the date receipt is acknowledged if delivered by certified mail, postage prepaid, return receipt requested or (c) one day after transmission if sent by facsimile transmission with confirmation of transmission, as follows:


If to Executive, addressed to:			Thomas B. Tyree, Jr.
			Extraction Oil & Gas, Inc.
			370 17th Street, Suite 5300
			Denver, CO 80202, or the last known residential address reflected in the Company’s records
If to the Company, addressed to:			Extraction Oil & Gas, Inc.
			370 17th Street, Suite 5300
			Denver, CO 80202
			Attention: General Counsel

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.

11.2 Applicable Law; Submission to Jurisdiction.

(a) This Agreement is entered into under, and shall be governed for all purposes by, the laws of the State of Colorado, without regard to conflicts of laws principles thereof.

(b) With respect to any claim or dispute related to or arising under this Agreement, the parties hereto hereby consent to the exclusive jurisdiction, forum and venue of the state and federal courts located in the State of Colorado.

11.3 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.

11.4 Severability. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of that provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect.

EXHIBIT 10.2

11.5 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.

11.6 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 and withholdings as may be required pursuant to any law or governmental regulation or ruling and all other customary deductions made with respect to the Company’s employees generally.

11.7 Headings. The Section headings have been inserted for purposes of convenience and shall not be used for interpretive purposes.

11.8 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.

11.9 Affiliate. As used in this Agreement, the term “affiliate” as used with respect to a particular person or entity shall mean any other person or entity which owns or controls, is owned or controlled by, or is under common ownership or control with, such particular person or entity.

11.10 Successors; Assigns; Third Party Beneficiaries. This Agreement shall be binding upon and inure to the benefit of the Company and any successor of the Company. In addition, the Company may assign this Agreement and Executive’s employment to any other affiliate of the Company at any time without the consent of Executive, and any assign of the Company shall be deemed to be the Company for purposes of this Agreement. Except as provided in the foregoing sentences of this Section 11.10, this Agreement and the rights and obligations of the parties hereunder are personal, and neither this Agreement nor any right, benefit, or obligation of either party hereto shall be subject to voluntary or involuntary assignment, alienation, or transfer, whether by operation of law or otherwise, without the prior written consent of the other party. In addition, any payment owed to Executive hereunder after the date of Executive’s death shall be paid to Executive’s estate. Each affiliate of the Company shall be a third party beneficiary of, and may directly enforce, Executive’s obligations under Article VI, Article VII and Article VIII.

11.11 Term. Termination of this Agreement shall not affect any right or obligation of any party which is accrued or vested prior to such termination. Without limiting the scope of the preceding sentence, the provisions of Articles V, VI, VII, VIII and IX shall survive any termination of the employment relationship and/or of this Agreement.

11.12 Entire Agreement. Except as provided in any signed written agreement contemporaneously or hereafter executed by the Company and Executive, 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 employment of Executive by the Company. 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 are hereby null and void and of no further force and effect.

11.13 Modification; Waiver. Any modification to or waiver of this Agreement will be effective only if it is in writing and signed by the parties to this Agreement.

11.14 Actions by the Board. Any and all determinations or other actions required of the Board hereunder that relate specifically to Executive’s employment by the Company or the terms and conditions of such employment shall be made by the members of the Board other than Executive if Executive is a member of the Board, and Executive shall not have any right to vote or decide upon any such matter.

EXHIBIT 10.2

11.15 Executive’s Representations and Warranties. Executive represents and warrants to the Company that (a) Executive does not have any agreements with any prior employers or other third parties that will prohibit Executive from working for the Company or fulfilling Executive’s duties and obligations to the Company pursuant to this Agreement and (b) Executive has complied with all duties imposed on Executive with respect to Executive’s former employer, e.g., Executive does not possess any tangible property belonging to Executive’s former employer.

11.16 Section 409A. The parties hereby agree that the payments and benefits provided under this Agreement are intended to not be subject to the additional tax provided by Section 409A, and this Agreement shall be interpreted, construed, and administered consistent with such intent. Each payment made under this Agreement shall be deemed to be a separate payment for purposes of Section 409A. Notwithstanding any provision in this Agreement to the contrary, if Executive is a “specified employee” (as such term is defined in Section 409A and as determined by the Company in accordance with any method permitted under Section 409A) and any payment or benefit provided for herein would be subject to additional taxes and interest under Section 409A if Executive’s receipt of such payment or benefit is not delayed until the Section 409A Payment Date, then such payment or benefit shall not be provided to Executive (or Executive’s estate, if applicable) until the Section 409A Payment Date. To the extent any expense reimbursement or the provision of any in-kind benefit is determined to be subject to Section 409A (and not exempt pursuant to the prior sentence or otherwise) (i) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, (ii) the amount of any such expenses eligible for reimbursement or in-kind benefits provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.

11.17 Clawback. Notwithstanding any provisions in this Agreement to the contrary, any compensation, payments, or benefits provided hereunder, whether in the form of cash or otherwise, shall be subject to a clawback to the extent necessary to comply with the requirements of any applicable law, or any regulations promulgated thereunder, or any policy adopted by the Company pursuant to any such law (whether in existence as of the Effective Date or later adopted).

[Signatures begin on next page.]

EXHIBIT 10.2

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

EXTRACTION OIL & GAS, INC.

By:

/s/ Matthew R. Owens

Name:

Matthew R. Owens

Title:

Chief Executive Officer

THOMAS B. TYREE, JR.

/s/ Thomas B. Tyree, Jr.

SIGNATURE PAGE TO

EMPLOYMENT AGREEMENT

TOM TYREE

EXHIBIT 10.3

INDEMNIFICATION AGREEMENT

This Indemnification Agreement (“Agreement”) is made as of March 4, 2020, by and between Extraction Oil & Gas, Inc., a Delaware corporation (the “Corporation”), and Thomas B. Tyree, Jr. (“Indemnitee”).

RECITALS:

WHEREAS, directors, officers and other persons in service to corporations or business enterprises are subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the Corporation or business enterprise itself;

WHEREAS, highly competent persons have become more reluctant to serve as directors, officers or in other capacities unless they are provided with adequate protection through insurance and adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the Corporation;

WHEREAS, the Board of Directors of the Corporation (the “Board”) has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Corporation and its stockholders and that the Corporation should act to assure such persons that there will be increased certainty of such protection in the future;

WHEREAS, (i) the Bylaws of the Corporation (as may be amended, the “Bylaws”) require indemnification of the officers and directors of the Corporation, (ii) Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (“DGCL”) and (iii) the Bylaws and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive and thereby contemplate that contracts may be entered into between the Corporation and members of the Board, officers and other persons with respect to indemnification;

WHEREAS, this Agreement is a supplement to and in furtherance of the Bylaws and the Certificate of Incorporation of the Corporation (as may be amended, the “Certificate of Incorporation”) and any resolutions adopted pursuant thereto, and shall not be deemed a substitute therefore, nor to diminish or abrogate any rights of Indemnitee thereunder; and

WHEREAS, (i) Indemnitee does not regard the protection available under the Bylaws and insurance as adequate in the present circumstances, (ii) Indemnitee may not be willing to serve or continue to serve as a director or officer of the Corporation without adequate protection, (iii) the Corporation desires Indemnitee to serve in such capacity, and (iv) Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Corporation on the condition that he be so indemnified.

AGREEMENT:

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Corporation and Indemnitee do hereby covenant and agree as follows:

Section 1 Definitions. (a) As used in this Agreement:

“Corporate Status” describes the status of a person who is or was a director, officer, employee or agent of (i) the Corporation or (ii) any other corporation, limited liability company, partnership or joint

EXHIBIT 10.3

venture, trust, employee benefit plan or other enterprise which such person is or was serving at the request of the Corporation.

“Disinterested Director” shall mean a director of the Corporation who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

“Enterprise” shall mean the Corporation and any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at the request of the Corporation as a director, officer, employee, agent or fiduciary.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Expenses” shall mean all reasonable costs, expenses, fees and charges, including, without limitation, attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also shall include, without limitation, (i) expenses incurred in connection with any appeal resulting from, incurred by Indemnitee in connection with, arising out of, or in respect of or relating to, any Proceeding, including, without limitation, the premium, security for, and other costs relating to any cost bond, supersedes bond, or other appeal bond or its equivalent, (ii) for purposes of Section 12(d) hereof only, expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise, (iii) any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, and (iv) any interest, assessments or other charges in respect of the foregoing. “Expenses” shall not include “Liabilities.”

“Indemnity Obligations” shall mean all obligations of the Corporation to Indemnitee under this Agreement, including the Corporation’s obligations to provide indemnification to Indemnitee and advance Expenses to Indemnitee under this Agreement.

“Independent Counsel” shall mean a law firm of fifty (50) or more attorneys, or a member of a law firm of fifty (50) or more attorneys, that is experienced in matters of corporation law and neither presently is, nor in the past five (5) years has been, retained to represent: (i) the Corporation or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder; provided, however, that the term

“Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Corporation or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

“Liabilities” shall mean all claims, liabilities, damages, losses, judgments, orders, fines, penalties and other amounts payable in connection with, arising out of, or in respect of or relating to any Proceeding, including, without limitation, amounts paid in settlement in any Proceeding and all costs and expenses in complying with any judgment, order or decree issued or entered in connection with any Proceeding or any settlement agreement, stipulation or consent decree entered into or issued in settlement of any Proceeding.

“Person” shall mean any individual, corporation, partnership, limited partnership, limited liability company, trust, governmental agency or body or any other legal entity.

EXHIBIT 10.3

“Proceeding” shall mean any threatened, pending or completed action, claim, suit, arbitration, alternate dispute resolution mechanism, formal or informal hearing, inquiry or investigation, litigation, inquiry, administrative hearing or any other actual, threatened or completed judicial, administrative or arbitration proceeding (including, without limitation, any such proceeding under the Securities Act of 1933, as amended, or the Exchange Act or any other federal law, state law, statute or regulation), whether brought in the right of the Corporation or otherwise, and whether of a civil, criminal, administrative or investigative nature, in each case, in which Indemnitee was, is or will be, or is threatened to be, involved as a party, witness or otherwise by reason of the fact that Indemnitee is or was a director or officer of the Corporation, by reason of any actual or alleged action taken by Indemnitee or of any action on Indemnitee’s part while acting as director or officer of the Corporation, or by reason of the fact that he is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, limited liability company, partnership, joint venture, trust or other enterprise, in each case whether or not serving in such capacity at the time any liability or expense is incurred for which indemnification, reimbursement, or advancement can be provided under this Agreement

(b) For the purpose hereof, references to “fines” shall include any excise tax assessed with respect to any employee benefit plan; references to “serving at the request of the Corporation” shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a Person who acted in good faith and in a manner he reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Agreement.

Section 2 Indemnity in Third-Party Proceedings. The Corporation shall indemnify and hold harmless Indemnitee, to the fullest extent permitted by applicable law, from and against all Liabilities and Expenses suffered or reasonably incurred (and, in the case of retainers, reasonably expected to be incurred) by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding (other than any Proceeding brought by or in the right of the Corporation to procure a judgment in its favor), or any claim, issue or matter therein.

Section 3 Indemnity in Proceedings by or in the Right of the Corporation. The Corporation shall indemnify and hold harmless Indemnitee, to the fullest extent permitted by applicable law, from and against all Liabilities and Expenses suffered or incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding brought by or in the right of the Corporation to procure a judgment in its favor, or any claim, issue or matter therein. No indemnification for Liabilities and Expenses shall be made under this Section 3 in respect of any claim, issue or matter as to which Indemnitee shall have been finally adjudged by a court to be liable to the Corporation, unless and only to the extent that the Delaware Court of Chancery or any court in which the Proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to such indemnification.

Section 4 Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provisions of this Agreement, and without limiting the rights of Indemnitee under any other provision hereof, including any rights to indemnification pursuant to Sections 2 or 3 hereof, to the fullest extent permitted by applicable law, to the extent that Indemnitee is successful, on the merits or otherwise, in any Proceeding or in defense of any claim, issue or matter therein, in whole or in part, the Corporation shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved Proceeding, claim, issue or matter. For purposes of this Section 4 and without limitation, the termination of any Proceeding or

EXHIBIT 10.3

claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

Section 5 Indemnification For Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the fullest extent permitted by applicable law and to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a witness or otherwise a participant in any Proceeding to which Indemnitee is not a party, Indemnitee shall be indemnified against all Expenses suffered or incurred (or, in the case of retainers, reasonably expected to be incurred) by Indemnitee or on Indemnitee’s behalf in connection therewith.

Section 6 Additional Indemnification. Notwithstanding any limitation in Sections 2, 3 or 4 hereof, the Corporation shall indemnify Indemnitee to the fullest extent permitted by applicable law if Indemnitee is a party to or threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the Corporation to procure a judgment in its favor) against all Liabilities and Expenses suffered or reasonably incurred by Indemnitee in connection with such Proceeding, including but not limited to:

(a) the fullest extent permitted by the provision of the DGCL that authorizes or contemplates additional indemnification by agreement, or the corresponding provision of any amendment to or replacement of the DGCL; and

(b) the fullest extent authorized or permitted by any amendments to or replacements of the DGCL adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its officers and directors.

Section 7 Exclusions. Notwithstanding any provision in this Agreement, the Corporation shall not be obligated under this Agreement to indemnify or hold harmless Indemnitee:

(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance policy obtained by the Corporation except with respect to any excess beyond the amount paid under such insurance policy;

(b) for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Corporation within the meaning of Section 16(b) of the Exchange Act or similar provisions of state statutory law or common law;

(c) except as provided in Section 12(d) of this Agreement, in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Corporation or its directors, officers, employees or other indemnitees, unless (i) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation or (ii) the Corporation provides the indemnification, in its sole discretion, pursuant to the powers vested in the Corporation under applicable law; or

(d) if a final decision by a court having jurisdiction in the matter shall determine that such indemnification is not lawful.

Section 8 Advancement. In accordance with the pre-existing requirements of the Bylaws, and notwithstanding any provision of this Agreement to the contrary, the Corporation shall advance, to the extent not prohibited by applicable law, the Expenses reasonably incurred by Indemnitee in connection with any Proceeding, and such advancement shall be made within thirty (30) days after the receipt by the Corporation of a statement or statements requesting such advances from time to time, whether prior to or

EXHIBIT 10.3

after final disposition of any Proceeding. Advances shall be unsecured and interest free. Advances shall be made without regard to Indemnitee’s ability to repay the Expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement. Advances shall include any and all Expenses reasonably incurred pursuing an action to enforce this right of advancement, including Expenses incurred preparing and forwarding statements to the Corporation to support the advances claimed. Indemnitee shall qualify for advances upon the execution and delivery to the Corporation of this Agreement, which shall constitute an undertaking providing that Indemnitee undertakes to repay the amounts advanced to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Corporation. This Section 8 shall not apply to any claim made by Indemnitee for which indemnity is excluded pursuant to Section 7 hereof.

Section 9 Procedure for Notification and Defense of Claim.

(a) Indemnitee shall promptly notify the Corporation in writing of any Proceeding with respect to which Indemnitee intends to seek indemnification or advancement hereunder following the receipt by Indemnitee of written notice thereof. The written notification to the Corporation shall include a description of the nature of the Proceeding and the facts underlying the Proceeding. To obtain indemnification under this Agreement, Indemnitee shall submit to the Corporation a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of such Proceeding. Any delay or failure by Indemnitee to notify the Corporation hereunder will not relieve the Corporation from any liability which it may have to Indemnitee hereunder or otherwise than under this Agreement, and any delay or failure in so notifying the Corporation shall not constitute a waiver by Indemnitee of any rights under this Agreement. The Secretary of the Corporation shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification.

(b) In the event Indemnitee is entitled to indemnification and/or advancement with respect to any Proceeding, Indemnitee may, at Indemnitee’s option, (i) retain counsel selected by Indemnitee and approved by the Corporation to defend Indemnitee in such Proceeding, at the sole expense of the Corporation (which approval shall not be unreasonably withheld, conditioned or delayed), or (ii) have the Corporation assume the defense of Indemnitee in such Proceeding, in which case the Corporation shall assume the defense of such Proceeding with counsel selected by the Corporation and approved by Indemnitee (which approval shall not be unreasonably withheld, conditioned or delayed) within ten (10) days of the Corporation’s receipt of written notice of Indemnitee’s election to cause the Corporation to do so. If the Corporation is required to assume the defense of any such Proceeding, it shall engage legal counsel for such defense, and the Corporation shall be solely responsible for all fees and expenses of such legal counsel and otherwise of such defense. Such legal counsel may represent both Indemnitee and the Corporation (and any other party or parties entitled to be indemnified by the Corporation with respect to such matter) unless, in the reasonable opinion of legal counsel to Indemnitee, there is a conflict of interest between Indemnitee and the Corporation (or any other such party or parties) or there are legal defenses available to Indemnitee that are not available to the Corporation (or any such other party or parties), in which case Indemnitee shall be entitled to obtain separate counsel and the Corporation shall be responsible for all reasonable fees and expenses of such separate legal counsel. Notwithstanding either party’s assumption of responsibility for defense of a Proceeding, each party shall have the right to engage separate counsel at its own expense. The party having responsibility for defense of a Proceeding shall provide the other party and its counsel with all copies of pleadings and material correspondence relating to the Proceeding. Indemnitee and the Corporation shall reasonably cooperate in the defense of any Proceeding with respect to which indemnification is sought hereunder, regardless of whether the Corporation or Indemnitee assumes the defense thereof. Indemnitee may not settle or compromise any Proceeding without the prior written consent of the Corporation, which

EXHIBIT 10.3

consent shall not be unreasonably withheld, conditioned or delayed. The Corporation may not settle or compromise any Proceeding without the prior written consent of Indemnitee.

Section 10 Procedure Upon Application for Indemnification.

(a) Upon written request by Indemnitee for indemnification pursuant to Section 9(a) hereof, if any determination by the Corporation is required by applicable law with respect to Indemnitee’s entitlement thereto, such determination shall be made (i) if Indemnitee shall request such determination be made by Independent Counsel, by Independent Counsel, and (ii) in all other circumstances, (A) by a majority vote of the Disinterested Directors, even though less than a quorum of the Board, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Board, (C) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee, or (D) if so directed by the Board, by the stockholders of the Corporation; and, if it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days after such determination. Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Corporation (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Corporation hereby indemnifies and agrees to hold Indemnitee harmless therefrom. The Corporation will not deny any written request for indemnification hereunder made in good faith by Indemnitee unless a determination as to Indemnitee’s entitlement to such indemnification described in this Section 10(a) has been made. The Corporation agrees to pay the reasonable fees and expenses of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Liabilities and Expenses arising out of or relating to this Agreement or its engagement pursuant hereto.

(b) In the event the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 10(a) hereof, (i) the Independent Counsel shall be selected by the Corporation within ten (10) days of the Submission Date (the cost of such Independent Counsel to be paid by the Corporation), (ii) the Corporation shall give written notice to Indemnitee advising it of the identity of the Independent Counsel so selected and (iii) Indemnitee may, within ten (10) days after such written notice of selection shall have been given, deliver to the Corporation Indemnitee’s written objection to such selection. Such objection by Indemnitee may be asserted only on the ground that the Independent Counsel selected does not meet the requirements of “Independent Counsel” as defined in this Agreement. If such written objection is made and substantiated, the Independent Counsel selected shall not serve as Independent Counsel unless and until Indemnitee withdraws the objection or a court has determined that such objection is without merit. Absent a timely objection, the person so selected shall act as Independent Counsel. If no Independent Counsel shall have been selected and not objected to before the later of (i) thirty (30) days after the later of submission by Indemnitee of a written request for indemnification pursuant to Section 10(a) hereof (the “Submission Date”) and (ii) ten (10) days after the final disposition of the Proceeding, each of the Corporation and Indemnitee shall select a law firm or member of a law firm meeting the qualifications to serve as Independent Counsel, and such law firms or members of law firms shall select the Independent Counsel. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 12(a) of this Agreement, Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

EXHIBIT 10.3

Section 11 Presumptions and Effect of Certain Proceedings.

(a) In making a determination with respect to entitlement to indemnification hereunder, the person, persons or entity making such determination shall, to the fullest extent not prohibited by applicable law, presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 9(a) of this Agreement, and the Corporation shall, to the fullest extent not prohibited by applicable law, have the burden of proof to overcome that presumption in connection with the making by any person, persons or entity of any determination contrary to that presumption. Neither the failure of the Corporation (including by its directors or independent legal counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Corporation (including by its directors or independent legal counsel) that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.

(b) Subject to Section 12(e) hereof, if the person, persons or entity empowered or selected under Section 10 of this Agreement to determine whether Indemnitee is entitled to indemnification shall not have made a determination within sixty (60) days after receipt by the Corporation of the request therefore, the requisite determination of entitlement to indemnification shall, to the fullest extent not prohibited by applicable law, be deemed to have been made and Indemnitee shall be entitled to such indemnification, absent a prohibition of such indemnification under applicable law; provided, however, that such 60-day period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if (i) the determination is to be made by Independent Counsel and Indemnitee objects to the Corporation’s selection of Independent Counsel and (ii) the Independent Counsel ultimately selected requires such additional time for the obtaining or evaluating of documentation or information relating thereto; provided further, however, that such 60-day period may also be extended for a reasonable time, not to exceed an additional sixty (60) days, if the determination of entitlement to indemnification is to be made by the stockholders of the Corporation.

(c) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Corporation or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.

(d) Reliance as Safe Harbor. For purposes of any determination of good faith, Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Enterprise, including financial statements, or on information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise or on information or records given or reports made to the Enterprise by an independent certified public accountant or by an appraiser or other expert selected with the reasonable care by the Enterprise. The provisions of this Section 11(d) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

(e) Actions of Others. The knowledge or actions, or failure to act, of any director, officer, agent or employee of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

EXHIBIT 10.3

Section 12 Remedies of Indemnitee.

(a) Subject to Section 12(e) hereof, in the event that (i) a determination is made pursuant to Section 10 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement is not timely made pursuant to Section 8 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10(a) of this Agreement within ninety (90) days after receipt by the Corporation of the request for indemnification, (iv) payment of indemnification is not made pursuant to Sections 4 or 5 or the last sentence of Section 10(a) of this Agreement within ten (10) days after receipt by the Corporation of a written request therefor, (v) payment of indemnification pursuant to Sections 2, 3 or 6 of this Agreement is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification, or (vi) in the event that the Corporation or any other Person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to recover from, Indemnitee the benefits provided or intended to be provided to Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court of Indemnitee’s entitlement to such indemnification or advancement. Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. The Corporation shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

(b) In the event that a determination shall have been made pursuant to Section 10(a) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 12 shall be conducted in all respects as a de novo trial, or arbitration, on the merits and Indemnitee shall not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section 12 the Corporation shall have the burden of proving Indemnitee is not entitled to indemnification or advancement, as the case may be.

(c) If a determination shall have been made pursuant to Section 10(a) of this Agreement that Indemnitee is entitled to indemnification, the Corporation shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 12, absent a prohibition of such indemnification under applicable law.

(d) The Corporation shall, to the fullest extent not prohibited by applicable law, be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Corporation is bound by all the provisions of this Agreement. It is the intent of the Corporation that Indemnitee not be required to incur Expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to Indemnitee hereunder. The Corporation shall indemnify Indemnitee against any and all such Expenses and, if requested by Indemnitee, shall (within ten (10) days after receipt by the Corporation of a written request therefore) advance, to the extent not prohibited by applicable law, such Expenses to Indemnitee, which are incurred by Indemnitee in connection with any action brought by Indemnitee for indemnification or advancement from the Corporation under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Corporation, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement or insurance recovery, as the case may be.

(e) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final

EXHIBIT 10.3

disposition of the Proceeding; provided that, in absence of any such determination with respect to such Proceeding, the Corporation shall advance Expenses with respect to such Proceeding.

Section 13 Non-Exclusivity; Survival of Rights; Insurance; Subrogation.

(a) The rights of indemnification and to receive advancement as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in Indemnitee’s Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in Delaware law, whether by statute or judicial decision, permits greater indemnification or advancement than would be afforded currently under the Bylaws or this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

(b) The Corporation hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement and insurance provided by one or more Persons with whom or which Indemnitee may be associated. The Corporation hereby acknowledges and agrees that (i) the Corporation shall be the indemnitor of first resort with respect to any Proceeding, Expense, Liability or matter that is the subject of the Indemnity Obligations, (ii) the Corporation shall be primarily liable for all Indemnity Obligations and any indemnification afforded to Indemnitee in respect of any Proceeding, Expense, Liability or matter that is the subject of Indemnity Obligations, whether created by applicable law, organizational or constituent documents, contract (including this Agreement) or otherwise, (iii) any obligation of any other Persons with whom or which Indemnitee may be associated to indemnify Indemnitee or advance Expenses or Liabilities to Indemnitee in respect of any Proceeding shall be secondary to the obligations of the Corporation hereunder, (iv) the Corporation shall be required to indemnify Indemnitee and advance Expenses or Liabilities to Indemnitee hereunder to the fullest extent provided herein without regard to any rights Indemnitee may have against any other Person with whom or which Indemnitee may be associated or insurer of any such Person and (v) the Corporation irrevocably waives, relinquishes and releases any other Person with whom or which Indemnitee may be associated from any claim of contribution, subrogation or any other recovery of any kind in respect of amounts paid by the Corporation hereunder. In the event any other Person with whom or which Indemnitee may be associated or their insurers advances or extinguishes any liability or loss which is the subject of any Indemnity Obligation owed by the Corporation or payable under any Corporation insurance policy, the payor shall have a right of subrogation against the Corporation or its insurer or insurers for all amounts so paid which would otherwise be payable by the Corporation or its insurer or insurers under this Agreement. In no event will payment of an Indemnity Obligation by any other Person with whom or which Indemnitee may be associated or their insurers affect the obligations of the Corporation hereunder or shift primary liability for any Indemnity Obligation to any other Person with whom or which Indemnitee may be associated. Any indemnification, insurance or advancement provided by any other Person with whom or which Indemnitee may be associated with respect to any Liability arising as a result of Indemnitee’s Corporate Status or capacity as an officer or director of any Person is specifically in excess over any Indemnity Obligation of the Corporation or any collectible insurance (including but not limited to any malpractice insurance or professional errors and omissions insurance) provided by the Corporation under this Agreement.

EXHIBIT 10.3

(c) To the extent that the Corporation maintains an insurance policy or policies providing liability insurance for directors, officers, employees, or agents of the Corporation or of any other Enterprise, Indemnitee shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such director, officer, employee or agent under such policy or policies and such policies shall provide for and recognize that the insurance policies are primary to any rights to indemnification, advancement or insurance proceeds to which Indemnitee may be entitled from one or more Persons with whom or which Indemnitee may be associated to the same extent as the Corporation’s indemnification and advancement obligations set forth in this Agreement. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Corporation has director and officer liability insurance in effect, the Corporation shall give prompt notice of the commencement of such Proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Corporation shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

(d) In the event of any payment under this Agreement, the Corporation shall not be subrogated to the rights of recovery of Indemnitee, including rights of indemnification provided to Indemnitee from any other person or entity with whom Indemnitee may be associated; provided, however, that the Corporation shall be subrogated to the extent of any such payment of all rights of recovery of Indemnitee under insurance policies of the Corporation or any of its subsidiaries.

(e) The indemnification and contribution provided for in this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of Indemnitee.

Section 14 Duration of Agreement; Not Employment Contract. This Agreement shall continue until and terminate upon the latest of: (i) ten (10) years after the date that Indemnitee shall have ceased to serve as a director, officer, employee or agent of the Corporation or any other Enterprise and (ii) the date of final termination of any Proceeding then pending in respect of which Indemnitee is granted rights of indemnification or advancement hereunder and of any proceeding commenced by Indemnitee pursuant to Section 12 of this Agreement relating thereto. This Agreement shall be binding upon the Corporation and its successors and assigns and shall inure to the benefit of Indemnitee and Indemnitee’s heirs, executors and administrators. This Agreement shall not be deemed an employment contract between the Corporation (or any of its subsidiaries or any other Enterprise) and Indemnitee. Indemnitee specifically acknowledges that Indemnitee’s employment with the Corporation (or any of its subsidiaries or any other Enterprise), if any, is at will, and Indemnitee may be discharged at any time for any reason, with or without cause, except as may be otherwise provided in any written employment contract between Indemnitee and the Corporation (or any of its subsidiaries or any other Enterprise), other applicable formal severance policies duly adopted by the Board, or, with respect to service as a director of the Corporation, by the Certificate of Incorporation, the Bylaws or the DGCL.

Section 15 Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by applicable law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

EXHIBIT 10.3

Section 16 Enforcement.

(a) The Corporation expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director, officer, employee or agent of the Corporation, and the Corporation acknowledges that Indemnitee is relying upon this Agreement in serving as a director, officer, employee or agent of the Corporation.

(b) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation, the Bylaws and applicable law, and shall not be deemed a substitute therefore, nor diminish or abrogate any rights of Indemnitee thereunder.

Section 17 Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by the parties thereto. No waiver of any of the provisions of this Agreement shall be deemed to be or shall constitute a waiver of any other provision of this Agreement nor shall any waiver constitute a continuing waiver.

Section 18 Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed, (c) mailed by reputable overnight courier and receipted for by the party to whom said notice or other communication shall have been directed or (d) sent by facsimile transmission, with receipt of oral confirmation that such transmission has been received:

(i) If to Indemnitee, at such address as Indemnitee shall provide to the Corporation.

(ii) If to the Corporation to:

Extraction Oil & Gas, Inc.

370 17th Street, Suite 5300

Denver, CO 80202

Attention: Board of Directors

or to any other address as may have been furnished to Indemnitee by the Corporation.

Section 19 Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Corporation, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for Liabilities or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (a) the relative benefits received by the Corporation and Indemnitee as a result of the event(s) and transaction(s) giving cause to such Proceeding; and (b) the relative fault of the Corporation (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and transaction(s).

EXHIBIT 10.3

Section 20 Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. Except with respect to any arbitration commenced by Indemnitee pursuant to Section 12(a) of this Agreement, the Corporation and Indemnitee hereby irrevocably and unconditionally (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Chancery Court of the State of Delaware (the “Delaware Court”), and not in any other state or federal court in the United States of America or any court in any other country, (b) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (c) waive any objection to the laying of venue of any such action or proceeding in the Delaware Court, and (d) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum.

Section 21 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

Section 22 Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

EXHIBIT 10.3

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.

EXTRACTION OIL & GAS, INC.

By: /s/ Eric J. Christ

Name: Eric J. Christ

Title: Vice President, General Counsel & Corporate Secretary

INDEMNITEE

By: /s/ Thomas B. Tyree, Jr.

Name: Thomas B. Tyree, Jr.

Title: Executive Chairman

Signature Page to Indemnification Agreement

EXHIBIT 10.4

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) is made by and between Extraction Oil & Gas, Inc., a Delaware corporation (the “Company”), and Matthew R. Owens (“Executive”) effective February 24, 2020 (the “Effective Date”), and hereby amends and replaces in its entirety any other employment agreement heretofore entered into between Executive and the Company or any of its affiliates, including Executive’s current employment agreement with the Company originally entered into October 11, 2016.

W I T N E S S E T H:

WHEREAS, the Company currently employs Executive as its President;

WHEREAS, Executive has served as the Company’s Interim Chief Executive Officer since April 4, 2019;

WHEREAS, the Company desires to now designate the Executive as the Company’s permanent Chief Executive Officer;

WHEREAS, the Company desires to continue to employ Executive on the terms and conditions, and for the consideration, hereinafter set forth and Executive desires to continue to be employed by the Company on such terms and conditions and for such consideration.

NOW, THEREFORE, for and in consideration of the mutual promises, covenants and obligations contained herein, the Company and Executive agree as follows:

ARTICLE I

DEFINITIONS

In addition to the terms defined in the body of this Agreement, for purposes of this Agreement, the following capitalized words shall have the meanings indicated below:

1.1 “Average Annual Bonus” shall mean the average Annual Bonus paid (or payable) for the two calendar years preceding the Date of Termination.

1.2 “Board” shall mean the Board of Directors of the Company.

EXHIBIT 10.4

1.4 “Change in Control” shall mean:

(b) the dissolution or liquidation of the Company;

1.5 “Code” shall mean the Internal Revenue Code of 1986, as amended.

1.6 “Date of Termination” shall mean the date Executive’s employment with the Company is considered to have terminated pursuant to Section 3.5.

1.7 “Good Reason” shall mean the occurrence of any of the following events:

(a) a material diminution in Executive’s Base Salary; or

(b) a material diminution in Executive’s authority, duties, or responsibilities; or

(d) a material breach by the Company of this Agreement.

Notwithstanding the foregoing provisions of this Section 1.7 or any other provision in this Agreement to the contrary, any assertion by Executive of a termination of employment for “Good Reason” shall not be effective unless all of the following conditions are satisfied: (i) the condition described in

EXHIBIT 10.4

Section 1.7(a), (b) or (c) giving rise to Executive’s termination of employment must have arisen without Executive’s consent; (ii) Executive must provide written notice to the Company of such condition in accordance with Section 11.1 within 45 days of the later of the initial existence of the condition or when Executive first learns of the existence of the condition (provided that such notice, if provided within 45 days of when Executive first learns of the existence of the condition, must in all circumstances be provided no later than 90 days following the initial existence of the condition); (iii) the condition specified in such notice must remain uncorrected for 30 days after receipt of such notice by the Company; and (iv) the date of Executive’s termination of employment must occur within 90 days after the initial existence of the condition specified in such notice or when Executive first learns of the existence of the condition (provided, however, that such termination may in no circumstance occur later than two years following the initial existence of the condition).

1.8 “Notice of Termination” shall mean a written notice delivered to the other party indicating the specific termination provision in this Agreement relied upon for termination of Executive’s employment and the intended Date of Termination and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated.

1.9 “Section 409A” shall mean section 409A of the Code and the Treasury Regulations and other interpretative guidance issued thereunder.

1.10 “Section 409A Payment Date” shall mean the earlier of (a) the date of Executive’s death or (b) the date that is six months after the date of termination of Executive’s employment with the Company.

ARTICLE II

EMPLOYMENT AND DUTIES

2.1 Employment; Effective Date. The Company agrees to continue to employ Executive, and Executive agrees to continue to be employed by the Company, pursuant to the terms of this Agreement beginning as of the Effective Date and continuing for the period of time set forth in Article III of this Agreement, subject to the terms and conditions of this Agreement.

2.2 Positions. From and after the Effective Date, the Company shall employ Executive in the position of Chief Executive Officer of the Company or in such other position or positions as the parties may mutually agree, and Executive shall report to the Board.

2.3 Duties and Services. Executive agrees to serve in the position referred to in Section 2.2 and to perform diligently and to the best of Executive’s abilities the duties and services appertaining to such position, as well as (a) such additional reasonably specific duties and services that Executive from time to time may be reasonably directed to perform by the Company that are reasonably consistent with such position, and (b) such additional duties and services appropriate to such position(s) which the parties mutually agree upon from time to time.

2.4 Other Interests. Executive agrees, during the period of Executive’s employment by the Company, to devote substantially all of Executive’s business time, energy and best efforts to the business and affairs of the Company and its affiliates. Notwithstanding the foregoing, the parties acknowledge and agree that Executive may (a) engage in and manage Executive’s passive personal investments and (b) engage in charitable and civic activities, including service as a member of the Board of Directors of the Colorado Oil & Gas Association and in an advisory capacity to the Denver Metro Chamber of Commerce; provided, however, that such activities shall be permitted so long as such activities do not materially conflict with the business and affairs of the Company or its affiliates or materially interfere with Executive’s performance of Executive’s duties hereunder.

EXHIBIT 10.4

2.5 Duty of Loyalty. Executive acknowledges and agrees that Executive owes a fiduciary duty of loyalty, fidelity and allegiance to act in the best interests of the Company and its affiliates and to do no act that would materially injure the business, interests, or reputation of the Company or any of its affiliates. In keeping with these duties, Executive shall make full disclosure to the Company of all business opportunities pertaining to the Company’s business and shall not appropriate for Executive’s own benefit business opportunities concerning the subject matter of the fiduciary relationship.

ARTICLE III

TERM AND TERMINATION OF EMPLOYMENT

3.1 Term. Unless sooner terminated pursuant to other provisions hereof, the Company agrees to continue 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 under this Agreement has not been terminated pursuant to Section 3.2 or 3.3, then said term of employment shall automatically be extended for successive one-year periods unless on or before the date that is 90 days prior to the first day of any such extension period either party shall give written notice to the other that no such automatic extension shall occur, in which case the term of employment shall terminate as of the end of the current term.

(a) upon Executive being unable to perform Executive’s duties or fulfill Executive’s obligations under this Agreement by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than six months as determined by the Company and certified in writing by a competent medical physician selected by the Company; or

(b) Executive’s death; or

(d) for any other reason whatsoever or for no reason at all, in the sole discretion of the Company.

EXHIBIT 10.4

Company and each affiliate of the Company and (b) an automatic resignation of Executive from the Board (if applicable), from the board of directors of any affiliate of the Company and from the board of directors or similar governing body of any corporation, limited liability entity or other entity in which the Company or any affiliate holds an equity interest and with respect to which board or similar governing body Executive serves as the Company’s or such affiliate’s designee or other representative.

ARTICLE IV

COMPENSATION AND BENEFITS

4.1 Base Salary. During the term of this Agreement, Executive shall receive a minimum, annualized base salary of $500,000 (the “Base Salary”). Executive’s annualized base salary shall be reviewed periodically by the Board (or a committee thereof) and, in the sole discretion of the Board (or a committee thereof), such annualized base salary may be increased (but not decreased) effective as of any date determined by the Board (or a committee thereof). Executive’s 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. Executive shall be eligible to receive an annual, calendar-year bonus (payable in a single lump sum) based on criteria determined in the discretion of the Board or a committee thereof (the “Annual Bonus”), it being understood that (a) the target bonus at planned or targeted levels of performance shall equal no less than 125% of Executive’s Base Salary and (b) the actual amount of each Annual Bonus shall be determined in the discretion of the Board or a committee thereof. The Company shall use commercially reasonable efforts to pay each Annual Bonus with respect to a calendar year on or before March 15 of the following calendar year (and in no event shall an Annual Bonus be paid after December 31 of the following calendar year); provided, however, that (except as otherwise provided in Section 5.3) Executive will be entitled to receive payment of such Annual Bonus only if Executive is employed by the Company on such date of payment.

4.3 Equity Award. Executive shall be eligible to receive an annual performance-based equity award under the Company’s then existing incentive equity plan based on vesting criteria determined in the discretion of the Board or a committee thereof, with a target grant date fair value equal to at least 550% of Executive’s Base Salary. Executive’s entitlement to any equity award remains subject to approval by the Board or a committee thereof.

4.5 Expenses. The Company shall reimburse Executive for all reasonable business expenses incurred by Executive in performing services hereunder, including all expenses of travel and living expenses while away from home on business or at the request of and in the service of the Company; provided, in each case, that such expenses are incurred and accounted for in accordance with the policies and procedures established by the Company. Any such reimbursement of expenses shall be made by the Company upon or as soon as practicable following receipt of supporting documentation reasonably satisfactory to the

EXHIBIT 10.4

Company (but in any event not later than the close of Executive’s taxable year following the taxable year in which the expense is incurred by Executive).

4.6 Vacation and Sick Leave. During Executive’s employment hereunder, Executive shall be entitled to sick and vacation leave in accordance with the Company’s policies applicable to its other senior executives, which leave shall accrue and be taken in accordance with the Company’s sick and vacation policies in effect from time to time. Executive’s right to carry over unused vacation from one calendar year to the next shall be determined by the Company’s vacation policy.

ARTICLE V

EFFECT OF TERMINATION OF EMPLOYMENT ON COMPENSATION

5.2 Death; Disability. If Executive’s employment hereunder shall terminate on account of his death or disability pursuant to Section 3.2(a) or (b), then all compensation and all benefits to Executive hereunder shall terminate contemporaneously with such termination of employment, except that Executive (or Executive’s legal representative, estate, and/or beneficiaries, as the case may be) shall be entitled to receive:

(a) the Accrued Rights;

EXHIBIT 10.4

Company pursuant to Section 3.2 for any reason other than those encompassed by Section 3.2(a), 3.2(b), or 3.2(c), then all compensation and all benefits to Executive hereunder shall terminate contemporaneously with such termination of employment, except that Executive shall be entitled to receive the Accrued Rights and, subject to Executive’s delivery, within 50 days after the Date of Termination, and non-revocation of an executed release in a form reasonably satisfactory to the Company (which shall release and discharge the Company and its affiliates, subsidiaries and benefit plans, and their respective stockholders, officers, directors, members, partners, employees, agents representatives and other affiliated persons from any and all claims or causes of action of any kind or character, including but not limited to all claims or causes of action arising out of Executive’s employment with the Company or its affiliates or the termination of such employment) (the “Release”), Executive shall receive the following additional compensation and benefits from the Company, as applicable, (but no other additional compensation or benefits after such termination):

(d) Post-Employment Health Coverage: During the portion, if any, of the 18-month period following the Date of Termination that Executive elects to continue coverage for Executive and Executive’s spouse and eligible dependents, if any, under the Company’s or the Company’s group health plans under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (COBRA), and/or sections 601 through 608 of the Employee Retirement Income Security Act of 1974, as amended, the Company shall promptly reimburse Executive on a monthly basis for the difference between the amount Executive pays to effect and continue such coverage and the employee contribution amount that similarly situated active senior executive employees of the Company pay for the same or similar coverage under such group health plans; provided, however, that in the event that Executive becomes eligible for group health coverage from a subsequent employer, the reimbursements provided by the Company under this Section 5.3(d) shall immediately cease; and

EXHIBIT 10.4

completed performance period and will vest based on actual level of achievement of all relevant performance goals against target through the end of any incomplete performance period); provided, however, that in the event that Executive’s Date of Termination under this Section 5.3(e) occurs in connection with a Change in Control, any outstanding performance-based awards will vest based on (1) actual performance through the end of any completed performance period and (2) the greater of (A) an assumed achievement of all relevant performance goals at the “target” level or (B) the actual level of achievement of all relevant performance goals against target as of the Company’s fiscal quarter end before the Change in Control for any incomplete performance period.

ARTICLE VI

PROTECTION OF INFORMATION

6.2 Disclosure to Executive. The Company has and will disclose to Executive and place Executive in a position to have access to or develop Confidential Information and Work Product of the Company (or its affiliates); and has and will entrust Executive with business opportunities of the Company (or its affiliates); and has and will place Executive in a position to develop business good will on behalf of the Company (or its affiliates).

6.3 No Unauthorized Use or Disclosure.

EXHIBIT 10.4

of the Company or its affiliates, or make any use thereof, except, in each case, in the carrying out of Executive’s responsibilities hereunder. Executive shall use all reasonable efforts to cause all persons or entities to whom any Confidential Information shall be disclosed by Executive hereunder to preserve and protect the confidentiality of such Confidential Information.

6.4 Ownership by the Company. If, during Executive’s employment by the Company, 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, or acquisitions, computer programs, E-mail, voice mail, electronic databases, drawings, maps, architectural renditions, models, manuals, brochures, or the like) relating to 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 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 relating to the Company’s business, products, or services 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 a motion picture or other 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 the work relating to the Company’s business, products, or services 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 during Executive’s employment by the Company, then Executive hereby

EXHIBIT 10.4

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.

ARTICLE VII

STATEMENTS CONCERNING THE COMPANY

EXHIBIT 10.4

ARTICLE VIII

NON-COMPETITION AGREEMENT

8.1 Definitions. As used in this Article VIII, the following terms shall have the following meanings:

“Prohibited Period” means the period during which Executive is employed by the Company hereunder and a period of two years following the termination of Executive’s employment with the Company.

EXHIBIT 10.4

not, and Executive will cause Executive’s affiliates not to, directly or indirectly, own, manage, operate, join, become an employee of, partner in, owner or member of (or an independent contractor to), control or participate in, be connected with or loan money to, sell or lease equipment or property to, or otherwise be affiliated with any business, individual, partnership, firm, corporation or other entity which engages in a Competing Business in the Restricted Area.

8.4 Reasonableness; Enforcement. Executive hereby represents to the Company that Executive has read and understands, and agrees to be bound by, the terms of this Article VIII. Executive acknowledges that the geographic scope and duration of the covenants contained in this Article VIII are the result of arm’s-length bargaining and are fair and reasonable in light of (a) the nature and wide geographic scope of the operations of the Business, (b) Executive’s level of control over and contact with the Business in all jurisdictions in which it is conducted, (c) the fact that the Business is conducted throughout the Restricted Area and (d) the amount of Confidential Information that Executive is receiving in connection with the

EXHIBIT 10.4

performance of Executive’s duties hereunder. It is the desire and intent of the parties that the provisions of this Article VIII be enforced to the fullest extent permitted under applicable Legal Requirements, whether now or hereafter in effect and therefore, to the extent permitted by applicable Legal Requirements, Executive and the Company hereby waive any provision of applicable Legal Requirements that would render any provision of this Article VIII invalid or unenforceable.

EXHIBIT 10.4

ARTICLE IX

DISPUTE RESOLUTION

ARTICLE X

CERTAIN EXCISE TAXES

EXHIBIT 10.4

whichever produces the better net after-tax position to Executive (taking into account any applicable excise tax under section 4999 of the Code and any other applicable taxes, including any federal, state, municipal, and local income or employment taxes, and taking into account the phase out of itemized deductions and personal exemptions). The reduction of payments and benefits hereunder, if applicable, shall be made by reducing, first, payments or benefits to be paid in cash hereunder in the order in which such payment or benefit would be paid or provided (beginning with such payment or benefit that would be made last in time and continuing, to the extent necessary, through to such payment or benefit that would be made first in time) and, then, reducing any benefit to be provided in-kind hereunder for which the 280G value is not reduced pursuant to Q/A 24(c) of the 280G Treasury Regulations in a similar order (but excluding from such reduction the continuation coverage provided by Section 5.3(d)), and then, reducing any other benefit to be provided in-kind hereunder in a similar order, in all instances in accordance with Section 409A. The determination as to whether any such reduction in the amount of the payments and benefits provided hereunder is necessary shall be made by the Company in good faith; provided, however, that (a) no portion of Executive’s payments or benefits the receipt or enjoyment of which Executive shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of section 280G(b) of the Code will be taken into account; (b) no portion of Executive’s payments or benefits will be taken into account which, in the opinion of tax counsel (“Tax Counsel”) for the Company does not constitute a parachute payment (including by reason of section 280G(b)(4)(A) of the Code); (c) in calculating the applicable excise tax under section 4999 of the Code, no portion of Executive’s payments or benefits will be taken into account which, in the opinion of Tax Counsel, constitutes reasonable compensation for services actually rendered, within the meaning of section 280G(b)(4)(B) of the Code, in excess of the base amount that is allocable to such reasonable compensation; and (d) the value of any non-cash benefit or any deferred payment or benefit will be determined by Tax Counsel or the Company’s independent auditor in accordance with the principles of sections 280G(d)(3) and (4) of the Code. At the time that payments are made under this Agreement, the Company will provide Executive with a written statement setting forth the manner in which such payments were calculated and the basis for such calculations, including any opinions or other advice the Company received from Tax Counsel, the Company’s independent auditor, or other advisors or consultants (and any such opinions or advice which are in writing will be attached to the statement). If a reduced payment or benefit is made or provided, and through error or otherwise, that payment or benefit, when aggregated with other payments and benefits from the Company (or its affiliates) used in determining if a “parachute payment” exists, exceeds one dollar ($1.00) less than three times Executive’s base amount, then Executive shall immediately repay such excess to the Company or the applicable affiliate upon notification that an overpayment has been made. The fact that Executive’s right to payments or benefits may be reduced by reason of the limitations contained in this Article X will not limit or otherwise affect any other rights of Executive under this Agreement or otherwise. All determinations required by this Article X will be made at the expense of the Company. However, nothing in this Article X shall require the Company or any affiliate to be responsible for, or have any liability or obligation with respect to, Executive’s excise tax liabilities under section 4999 of the Code.

ARTICLE XI

MISCELLANEOUS

EXHIBIT 10.4


If to Executive, addressed to:			Matthew R. Owens
			Extraction Oil & Gas, Inc.
			370 17th Street, Suite 5300
			Denver, CO 80202, or the last known residential address reflected in the Company’s records
If to the Company, addressed to:			Extraction Oil & Gas, Inc.
			370 17th Street, Suite 5300
			Denver, CO 80202
			Attention: General Counsel

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.

11.2 Applicable Law; Submission to Jurisdiction.

(a) This Agreement is entered into under, and shall be governed for all purposes by, the laws of the State of Colorado, without regard to conflicts of laws principles thereof.

11.5 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.

11.7 Headings. The Section headings have been inserted for purposes of convenience and shall not be used for interpretive purposes.

11.8 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.

EXHIBIT 10.4

without the consent of Executive, and any assign of the Company shall be deemed to be the Company for purposes of this Agreement. Except as provided in the foregoing sentences of this Section 11.10, this Agreement and the rights and obligations of the parties hereunder are personal, and neither this Agreement nor any right, benefit, or obligation of either party hereto shall be subject to voluntary or involuntary assignment, alienation, or transfer, whether by operation of law or otherwise, without the prior written consent of the other party. In addition, any payment owed to Executive hereunder after the date of Executive’s death shall be paid to Executive’s estate. Each affiliate of the Company shall be a third party beneficiary of, and may directly enforce, Executive’s obligations under Article VI, Article VII and Article VIII.

11.13 Modification; Waiver. Any modification to or waiver of this Agreement will be effective only if it is in writing and signed by the parties to this Agreement.

EXHIBIT 10.4

expenses eligible for reimbursement or in-kind benefits provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.

[Signatures begin on next page.]

EXHIBIT 10.4

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

EXTRACTION OIL & GAS, INC.

By:

/s/ Eric J. Christ

Name:

Eric J. Christ

Title:

Vice President, General Counsel & Corporate Secretary

MATTHEW R. OWENS

/s/ Matthew R. Owens

SIGNATURE PAGE TO

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

MATTHEW R. OWENS

EXHIBIT 10.5

EXTRACTION OIL & GAS, INC.

EXECUTIVE SEVERANCE PLAN

Extraction Oil & Gas, Inc. (the “Company”) has adopted this Extraction Oil & Gas, Inc. Executive Severance Plan for eligible executives of the Company (the “Plan”), effective as of November 13, 2019 (the “Effective Date”). The Plan is intended to provide severance benefits to eligible executives in the event of certain qualifying terminations of employment from the Company. The Plan, as a “severance pay arrangement” within the meaning of Section 3(2)(B)(i) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), is intended to be and will be administered and maintained as an unfunded welfare benefit plan under Section 3(1) of ERISA.

1.Eligible Executives. An executive of the Company will become a participant in the Plan (a “Participant”) as of the date the executive is specifically designated a participant by the Plan Administrator (as defined below in Section 5.1).

2.Eligibility for Severance Benefits.

2.1 Participant will be eligible to receive Severance Benefits (as defined below in Section 3.2) under the Plan upon the Participant’s Qualifying Termination (as defined below in Section 2.3), provided that the Participant:

a.enters into a Participation Agreement with the Company in substantially the form set forth on Schedule A hereto (a “Participation Agreement”), which will include a Restrictive Covenant Agreement (a “Restrictive Covenant Agreement”);

b.performs all transition and other matters required of the Participant by the Company before the Participant’s Qualifying Termination;

c.returns to the Company any property of the Company that has come into the Participant’s possession upon the Participant’s Qualifying Termination; and

d.executes and returns (and does not thereafter revoke), within 45 days after the Participant’s Qualifying Termination, a general release in a form acceptable to the Plan Administrator (the “Release”), under which the Participant, among other things, releases and discharges the Company and its subsidiaries and affiliates from all claims and liabilities relating to the Participant’s employment with the Company and the termination of such employment. “Release Effective Date” means, with respect to a Participant, the date the Participant’s Release becomes effective and is no longer subject to revocation. “Payment Date” means the Company’s first regularly scheduled payroll date after the Release Effective Date.

2.2 “Termination of Employment” means, with respect to each Participant, the Participant’s termination of employment with the Company and all of its subsidiaries and affiliates. Any payments to be made to a Participant under the Plan upon a Termination of Employment will only be made upon such Participant’s “separation from service,” as such term is defined under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).

2.3 “Qualifying Termination” means, with respect to each Participant, a Termination of Employment:

a.by the Company not for Cause (as defined below in Section 2.4);

b.by the Participant with Good Reason (as defined below in Section 2.5); or

EXHIBIT 10.5

c.due to the Participant’s Disability (as defined below in Section 2.6) or death.

If the Participant’s Termination of Employment is by the Company for Cause or by the Participant without Good Reason, the Participant will not be eligible to receive Severance Benefits under the Plan.

2.4 “Cause” means, with respect to each Participant, a determination by the Plan Administrator that the Participant:

a.has engaged in gross negligence or willful misconduct in the performance of the Participant’s duties with respect to the Company or any of its affiliates;

b.has materially breached any provision of the Participant’s Participation Agreement;

c.has committed an act of theft, fraud, embezzlement, misappropriation, or willful breach of a fiduciary duty with respect to the Company or any of its affiliates; or

d.has been convicted of, pleaded no contest to, or received adjudicated probation or deferred adjudication in connection with a crime involving fraud, dishonesty, or moral turpitude, or any felony (or a crime of similar import in a foreign jurisdiction).

In order to terminate a Participant’s employment for Cause, the Plan Administrator must provide the Participant with a written notice providing in reasonable detail the specific circumstances alleged to constitute Cause and the Participant must not have cured or remedied the alleged Cause event (if susceptible to cure) in the Plan Administrator’s good faith judgment within 30 days after the Participant’s receipt of such notice.

2.5 “Good Reason” means, with respect to each Participant, the occurrence of any of the following events:

a.a material diminution in the Participant’s base salary;

b.a material diminution in the Participant’s authority, duties, or responsibilities;

c.the involuntary relocation of the geographic location of the Participant’s principal place of employment by more than 50 miles; or

d.a material breach by the Company of the Plan with respect to the Participant.

Any assertion by a Participant of a Termination of Employment for “Good Reason” will not be effective unless all of the following conditions are satisfied: (i) the condition described in Section 2.5(a), (b), or (c) giving rise to the Participant’s Termination of Employment must have arisen without the Participant’s consent; (ii) the Participant must provide written notice to the Company of such condition within 45 days of the later of the initial existence of the condition or when the Participant first learns of the existence of the condition (provided that such notice, if provided within 45 days of when the Participant first learns of the existence of the condition, must in all circumstances be provided no later than 90 days after the initial existence of the condition); (iii) the condition specified in such notice must remain uncorrected for 30 days after receipt of such notice by the Company; and (iv) the Participant’s Termination of Employment must occur within 90 days after the initial existence of the condition specified in such notice or when the Participant first learns of the existence of the condition (provided, however, that such termination may in no circumstance occur later than 2 years after the initial existence of the condition).

EXHIBIT 10.5

2.6 “Disability” means, with respect to each Participant, an incapacity that has resulted in qualification of the Participant to receive long-term disability benefits under the Company’s long-term disability plan; and if the Participant is not covered by such a plan, the Participant will be considered to have a Disability if the Participant’s incapacity results in a determination by the Social Security Administration that the Participant is entitled to a Social Security disability benefit.

2.7 If the Participant dies before receiving a portion of the Participant’s Severance Benefits under the Plan, any remaining Severance Benefits will be paid to the appointed administrator, executor, or personal representative of the Participant’s estate no later than March 15th following the calendar year in which the Participant’s death occurs.

3.Severance Benefits.

3.1 Participation in the Plan will not affect any Participant’s rights to the following Company benefits, which the Company will pay in accordance with applicable law and terms of the applicable Company plan, in each case to the extent applicable to the Participant (the “Accrued Benefits”):

a.base salary earned through Termination of Employment;

b.unpaid annual cash bonus for the calendar year before the year in which Termination of Employment occurs; provided, however, that a Participant will not be entitled to payment of any bonus upon a Termination of Employment for Cause;

c.reimbursement for approved but unreimbursed business expenses incurred through Termination of Employment;

d.continued insurance coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) and any similar state law; and

e.vested retirement benefits under the Company’s retirement plans.

3.2 If the Participant satisfies the requirements of the Plan, including the Participant’s execution and non-revocation of the Release, upon a Qualifying Termination, the Participant will be eligible to receive the following (the “Severance Benefits”):

a.If the Qualifying Termination occurs outside a Change in Control Period (as defined below in Section 3.3) and is by the Company not for Cause (but not including the Participant’s Termination of Employment due to Disability or death) or by the Participant for Good Reason, then Severance Benefits will be as follows:

i.on the Payment Date, a lump sum cash amount equal to the Participant’s annual base salary as in effect immediately before the Qualifying Termination, divided by 12, multiplied by the Non-CIC Applicable Factor for the Participant set forth on Schedule B hereto;

ii.on the Payment Date, a lump sum cash amount equal to the Participant’s target annual cash bonus for the year of the Qualifying Termination, prorated to reflect the number of days that the Participant was employed during the year of the Qualifying Termination;

iii.if the Participant timely and properly elects health plan continuation coverage under COBRA, the Company will reimburse the Participant for the monthly COBRA

EXHIBIT 10.5

premium paid by the Participant for the Participant and the Participant’s dependents; provided that the Participant will be eligible to receive such reimbursement until the earliest of (A) the 18-month anniversary of the Qualifying Termination, (B) the date the Participant is no longer eligible to receive COBRA continuation coverage, and (C) the date the Participant becomes eligible to receive substantially similar coverage from another employer or other source; and provided, further, that if the Company’s payments under this Section 3.2(a)(iii) would violate the nondiscrimination rules under the ACA, or result in the imposition of penalties under the ACA, the Participant will not be entitled to any such payments; and

iv.notwithstanding anything to the contrary contained in any equity compensation plan of the Company (each, an “Equity Plan”) or any award agreement thereunder, acceleration of the Participant’s outstanding Equity Plan awards as follows:

A.each Equity Plan award that vests based solely on continued service (a “Time Award”) will become 100% vested on the Payment Date,

B.for each Equity Plan award that vests based on the attainment of performance goals (“a Performance Award”), if there is less than 1 year remaining in the applicable performance period, the award will remain outstanding and continue to vest under its original terms (only without regard to any continued service requirement); and if there is more than 1 year remaining in the applicable performance period, the award will remain outstanding and continue to vest under its original terms (only without regard to any continued service requirement) and the final amount of the award will be prorated based on the number of days that the Participant was employed during the performance period, and

C.each exercisable Equity Plan award (e.g., a stock option or a stock appreciation right) that is or becomes exercisable will remain exercisable until the latest date on which the award would have expired by its original terms (disregarding any early termination due to separation from service), subject to any rights the Company may have to liquidate such award for fair market value in connection with a corporate transaction.

b.If the Qualifying Termination occurs inside a Change in Control Period and is by the Company not for Cause (but not including the Participant’s Termination of Employment due to Disability or death) or by the Participant for Good Reason, then the Severance Benefits will be as follows:

i.on the Payment Date, a lump sum cash amount equal to the sum of the Participant’s annual base salary plus target annual bonus as in effect immediately before the Qualifying Termination, divided by 12, multiplied by the CIC Applicable Factor for the Participant set forth on Schedule C hereto;

ii.notwithstanding anything to the contrary contained in any Equity Plan or any award agreement thereunder, acceleration of the Participant’s outstanding Equity Plan awards as follows:

A.each Time Award will become 100% vested on the Payment Date,

EXHIBIT 10.5

B.for each Performance Award, the target payout opportunities attainable under such awards will be deemed to have been fully earned as of the Change in Control based upon the greater of (1) an assumed achievement of all relevant performance goals at the “target” level or (2) the actual level of achievement of all relevant performance goals against target as of the Company’s fiscal quarter end before the Change in Control, and

c.If the Qualifying Termination is due to the Participant’s Disability or death, whether inside or outside the Change in Control Period, then the Severance Benefits will be as follows:

i.on the Payment Date, a lump sum cash amount equal to the Participant’s annual base salary as in effect immediately before the Qualifying Termination;

iii.notwithstanding anything to the contrary contained in any Equity Plan or any award agreement thereunder, acceleration of the Participant’s outstanding Equity Plan awards as follows:

A.each Time Award will become 100% vested on the Payment Date, and

B.for each Performance Award, the target payout opportunities attainable under such awards will be deemed to have been earned as of the Qualifying Termination based on the actual level of achievement of all relevant performance goals against target as of the Company’s fiscal quarter end before the Qualifying Termination.

d.For the avoidance of doubt, a Participant may only receive Severance Benefits under one of Section 3.2(a), Section 3.2(b), or Section 3.2(c) above.

3.3 “Change in Control Period” means the period beginning on a Change in Control and ending 18 months after the Change in Control.

3.4 “Change in Control” means the occurrence of any of the following events:

a.a merger of the Company with another entity, a consolidation involving the Company, or the sale of all or substantially all of the assets of the Company to another entity if, in any such case, (i) the holders of equity securities of the Company immediately before such transaction do not beneficially own immediately after such transaction equity securities of the resulting entity entitled to 50% or more of the votes then eligible to be cast in the election of directors generally (or comparable governing body) of the resulting entity in substantially the same proportions that they owned the equity securities of the Company immediately before such

EXHIBIT 10.5

transaction or (ii) the persons who were members of the Board immediately before such transaction do not constitute at least a majority of the board of directors of the resulting entity immediately after such transaction;

b.the dissolution or liquidation of the Company;

c.any person or entity, including a “group” as contemplated by section 13(d)(3) of the Securities Exchange Act of 1934, as amended, acquires or gains ownership or control (including the power to vote) of more than 50% of the combined voting power of the outstanding securities of the Company; or

d.as a result of or in connection with a contested election of directors, the persons who were members of the Board immediately before such election cease to constitute a majority of the Board.

For purposes of this definition, (1) “resulting entity” in the context of a transaction that is a merger, consolidation, or sale of all or substantially all assets means the surviving entity (or acquiring entity in the case of an asset sale) unless the surviving entity (or acquiring entity in the case of an asset sale) is a subsidiary of another entity and the holders of common stock of the Company receive capital stock of such other entity in such transaction, in which event the resulting entity is such other entity, and (2) after the consummation of a merger or consolidation that does not constitute a Change in Control, the term “Company” will refer to the resulting entity and the term “Board” will refer to the board of directors (or comparable governing body) of the resulting entity.

Notwithstanding the foregoing, for purposes of any Severance Benefits that provide for a deferral of compensation under Code Section 409A, to the extent the impact of a Change in Control on such an Severance Benefits would subject a Participant to additional taxes under Code Section 409A, a Change in Control for purposes of such Severance Benefits will mean a Change in Control that is also a “change in control” under Code Section 409A.

4.Forfeiture of Benefits.

4.1 Cessation of Benefits. All Severance Benefits to a Participant under the Plan shall cease immediately:

a.Upon discovery by the Company that the Participant, while working as an employee of the Company, engaged in any activity that would have constituted Cause; or

b.Upon discovery by the Company that the Participant has violated the Participant’s Restrictive Covenant Agreement.

4.2 Repayment of Benefits. The Company reserves the right to recover Severance Benefits under the Plan from a Participant if the Participant violates the Participant’s Restrictive Covenant Agreement.

5.Plan Administration.

5.1 The Plan will be administered by the Compensation Committee of the Board (the “Plan Administrator”).

5.2 The Plan Administrator will have full and complete authority to enforce the Plan in accordance with its terms and will have all powers necessary to accomplish that purpose, including the following:

EXHIBIT 10.5

a.To apply and interpret the Plan, including the authority to construe disputed provisions;

b.To determine all questions arising in its administration, including those related to the eligibility of persons to become Participants and eligibility for Severance Benefits, and the rights of Participants;

c.To compute and certify the amount of Severance Benefits payable to Participants;

d.To authorize all disbursements in accordance with the Plan;

e.To employ and reasonably compensate accountants, attorneys, and other persons to render advice or perform services for the Plan as it deems necessary;

f.To make available to Participants upon request, for examination during business hours, such records as pertain exclusively to the examining Participant; and

g.To appoint an agent for service of legal process.

5.3 All decisions of the Plan Administrator based on the Plan and documents presented to it will be in the Plan Administrator’s sole discretion and will be final and binding upon all persons.

5.4 In no event will the Company, the Plan Administrator, or any officer or director of the Company incur any liability for any act or failure to act with respect to the Plan.

6.Claims Procedures.

6.1 Claims for Benefits. Generally, an obligation of the Plan to provide Severance Benefits to a Participant arises only after the Participant executes a Participation Agreement and incurs a Qualifying Termination. A Participant not receiving Severance Benefits who believes that he or she is eligible for such benefits, or a Participant disputing the amount of Severance Benefits, or any such Participant’s authorized representative (the “Claimant”), may request in writing that his or her claim be reviewed by the Plan Administrator. All such claims for benefits must be submitted to the Plan Administrator at the following address within 60 days after the Participant’s Termination of Employment:

Extraction Oil & Gas, Inc.

370 17th Street, Suite 5300

Denver, CO 80202

Attention: Plan Administrator for Executive Severance Plan

The review of all claims for Severance Benefits will be governed by the following rules:

a.Time Limits on Decision. Unless special circumstances exist, a Claimant who has filed a claim will be informed of the decision on the claim within 90 days of the Plan Administrator’s receipt of the written claim. This period may be extended by an additional 90 days if special circumstances require an extension of time, provided the Claimant is notified of the extension within the initial 90-day period. The extension notice will indicate:

i.The special circumstances requiring the extension of time; and

EXHIBIT 10.5

ii.The date, no later than 180 days after receipt of the written claim, by which the Claimant can expect to receive a decision.

b. Content of Denial Notice. If a claim for benefits is partially or wholly denied, the Claimant will receive a written notice that:

i. States the specific reason or reasons for the denial;

ii. Refers to the specific Plan provisions on which the denial is based;

iii. Describes and explains the need for any additional material or information that the Claimant must supply in order to perfect the claim; and

iv. Describes the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review.

6.2 Appeal of Denied Claims. If the Claimant’s claim is denied and he or she wants to submit a request for a review of the denied claim, the following rules apply:

a.Review of Denied Claim. If a Claimant wants his or her denied claim to be reconsidered, the Claimant must send a written request for a review of the claim denial to the Plan Administrator no later than 60 days after the date on which he or she receives written notification of the denial. The Claimant may include any written comments, documents, records, or other information relating to the claim for benefits. The Claimant will be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relating to the claim for benefits. The Plan Administrator’s review will take into account all comments, documents, records, and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

b.Decision on Review. The Plan Administrator will review the denied claim and provide a written decision within 60 days of the date the Plan Administrator receives the Claimant’s written request for review. This period may be extended by an additional 60 days if special circumstances require an extension of time, provided the Participant is notified of the extension within the initial 60-day period. The extension notice will indicate:

i.The special circumstances requiring the extension of time; and

ii.The date, no later than 120 days after receipt of the written request for review, by which the Claimant can expect to receive a decision.

c.Content of Denial Notice. If a claim for benefits is partially or wholly denied on appeal, the Claimant will receive a written notice that:

i.States the specific reason or reasons for denial;

ii.Refers to the specific Plan provisions on which the denial is based;

iii.Includes a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claim; and

EXHIBIT 10.5

iv.Includes a statement of the right to bring a civil action under Section 502(a) of ERISA.

6.3 Limitations on Legal Actions; Dispute Resolution. Claimants must follow the claims procedures described in this Section 6 before taking action in any other forum regarding a claim for benefits under the Plan. Furthermore, any such action initiated by a Claimant under the Plan must be brought by the Claimant within one year of a final determination on the claim for benefits under these claims procedures, or the Claimant’s benefit claim will be deemed permanently waived and abandoned, and the Claimant will be precluded from reasserting it. Further, after following the claims procedures described in this Section 6, the following terms apply to any further disputes that may arise regarding the Plan (other than disputes with respect to a Restrictive Covenant Agreement):

a.In the event of any dispute, claim, question, or disagreement arising out of or relating to the Plan, the parties will use their best efforts to settle such dispute, claim, question, or disagreement. To this effect, they will consult and negotiate with each other, in good faith, and, recognizing their mutual interests, attempt to reach a just and equitable resolution satisfactory to both parties.

b.If the parties do not reach such a resolution within a period of 30 days, then any such unresolved dispute or claim, upon notice by any party to the other, will be submitted to and finally settled by arbitration in accordance with the Commercial Arbitration Rules (the “Rules”) of the American Arbitration Association in effect at the time demand for arbitration is made by any such party. The parties will mutually agree upon a single arbitrator within 30 days of such demand. In the event that the parties are unable to so agree within such 30-day period, then within the following 30-day period, 1 arbitrator will be named by each party. A third arbitrator will be named by the 2 arbitrators so chosen within 10 days after the appointment of the first 2 arbitrators. In the event that the third arbitrator is not agreed upon, he or she will be named by the American Arbitration Association. Arbitration will occur in the State of Colorado or such other location as may be mutually agreed to by the parties.

c.The award made by all or a majority of the panel of arbitrators will be final and binding, and judgment may be entered based upon such award in any court of law having competent jurisdiction. The award is subject to confirmation, modification, correction, or vacation only as explicitly provided in Title 9 of the United States Code. The parties acknowledge that the Plan evidences a transaction involving interstate commerce. The United States Arbitration Act and the Rules will govern the interpretation, enforcement, and proceedings under this Section 6.3. Any provisional remedy that would be available from a court of law will be available from the arbitrators to the parties to the Plan pending arbitration. Either party may make an application to the arbitrators seeking injunctive relief to maintain the status quo, or may seek from a court of competent jurisdiction any interim or provisional relief that may be necessary to protect the rights and property of that party, until such times as the arbitration award is rendered or the controversy otherwise resolved.

d.By agreeing to binding arbitration, a Participant must waive his or her right to a jury trial. The claims covered by this Section 6.3 include any statutory claims regarding a Participant’s employment or the termination of his or her employment, including claims regarding workplace discrimination.

EXHIBIT 10.5

7.Miscellaneous.

7.1 Withholding. The Company will have authority to withhold or cause to have withheld applicable income and payroll taxes from any Severance Benefits under the Plan to the extent required by law.

7.2 No Contract of Employment. The Plan will not be deemed to constitute a contract of employment or impose on the Company any obligation to retain any Participant as an employee, to continue any Participant’s current employment status, or to change any employment policies of the Company, nor will any term of the Plan restrict the right of the Company to discharge any of its employees or restrict the right of any such employee to terminate his employment with the Company.

7.3 Source of Benefits. The Plan is intended to be an unfunded welfare benefit plan for purposes of ERISA and a severance pay arrangement within the meaning of Section 3(2)(B)(i) of ERISA. All benefits payable under the Plan will be paid or provided by the Company from its general assets. The Plan is not intended to be a pension plan described in Section 3(2)(A) of ERISA.

7.4 Section 409A. It is intended that the payments and benefits available under the Plan will be, to the greatest extent possible, exempt from the application of Code Section 409A, and the Plan will be construed and interpreted accordingly. However, if the Company determines that all or a portion of the payments or benefits provided under the Plan constitute “deferred compensation” under Code Section 409A and that the Participant is a “specified employee,” as such term is defined under Code Section 409A, then, solely to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Code Section 409A, the timing of the applicable payments will be delayed until the first payroll date after the 6-month anniversary of the Participant’s “separation from service” (as defined under Code Section 409A) and the Company will (a) pay to the Participant a lump sum amount equal to the sum of the payments that the Participant would otherwise have received during such 6-month period had no such delay been imposed and (b) commence paying the balance of the payments in accordance with the applicable payment schedule set forth in the Plan. For purposes of Section 409A, each installment payment provided under the Plan will be treated as a separate payment. The Company makes no representations that the payments and benefits provided under the Plan comply with Code Section 409A and in no event will the Company be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by the Participant on account of noncompliance with Code Section 409A.

7.5 Plan Amendment and Termination. The Plan Administrator may at any time terminate or amend the Plan with respect to any or all Participants for any reason, including altering, reducing, or eliminating benefits to be paid to Participants who have not yet experienced a Termination of Employment; provided, however, that any amendment or termination that eliminates potential Severance Benefits for a Participant may not be effective until 18 months after notice is provided to the Participant. The provisions of the Plan as in effect at the time of a Participant’s Termination of Employment will control any Severance Benefits paid to that Participant, unless modified by the Plan Administrator or otherwise specified in the Plan.

7.6 Severability. Should any term of the Plan be deemed or held to be unlawful or invalid for any reason, such fact will not adversely affect the other terms of the Plan unless such determination will render impossible or impracticable the functioning of the Plan, and in such case, an appropriate term or terms will be adopted so that the Plan may continue to function properly.

7.7 Non-Assignment. The rights of a Participant under the Plan are personal. No interest of a Participant under the Plan may be assigned, transferred, seized by legal process, or subjected to the

EXHIBIT 10.5

claims of creditors in any way. A Participant’s rights under the Plan are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, or encumbrance.

7.8 Governing Law. The Plan will be construed according to the laws of the State of Colorado, except as preempted by ERISA or other applicable federal law.

EXHIBIT 10.5

SCHEDULE A TO EXECUTIVE SEVERANCE PLAN

PARTICIPATION AGREEMENT

EXTRACTION OIL & GAS, INC.

EXECUTIVE SEVERANCE PLAN

This Participation Agreement is made and entered into by and between the Executive set forth below (“you”) and Extraction Oil & Gas, Inc., a Delaware corporation (the “Company”), effective as of ________________________ (the “Agreement Date”).

The Company maintains the Extraction Oil & Gas, Inc. Executive Severance Plan (the “Plan”), which provides specified severance benefits in connection with certain Qualifying Terminations (as defined in the Plan). You hereby acknowledge that you have read and understand all of the terms of the Plan, and that you agree to participate in the Plan subject to those terms. You agree that as a result of you becoming a participant in the Plan, the Employment Agreement between the Company and you dated ________________________ will be terminated in its entirety, and that neither you nor the Company will have any further rights or obligations under such Employment Agreement as of the Agreement Date.

By signing this Participation Agreement, you are also acknowledging that you have read and understand all of the terms of the Restrictive Covenant Agreement attached as Exhibit 1 to this Participation Agreement, and that you agree to all of the terms of that Restrictive Covenant Agreement as a condition to participating in the Plan.

IN WITNESS WHEREOF, each of the parties has executed this Participation Agreement, in the case of the Company by its duly authorized officer, as of the Agreement Date.

EXTRACTION OIL & GAS, INC. EXECUTIVE

Sign name: Sign name:

Print name: Print name:

Title:

EXHIBIT 10.5

EXHIBIT A TO PARTICIPATION AGREEMENT

RESTRICTIVE COVENANT AGREEMENT

THIS RESTRICTIVE COVENANT AGREEMENT (“Agreement”) is made by and between Extraction Oil & Gas, Inc., a Delaware corporation (the “Company”), and [Name] (“Executive”) effective [Date] (the “Effective Date”), and hereby amends and replaces in its entirety any other restrictive covenant agreement heretofore entered into between Executive and the Company or any of its affiliates.

W I T N E S S E T H:

WHEREAS, the Company maintains an Executive Severance Plan (the “Plan”).

WHEREAS, Executive is required to enter into this Agreement as a condition to participating in the Plan.

NOW, THEREFORE, for and in consideration of the mutual promises, covenants and obligations contained herein, the Company and Executive agree as follows:

ARTICLE I

DEFINITIONS

In addition to the terms defined in the body of this Agreement, for purposes of this Agreement, capitalized words shall have the meanings from the Plan.

ARTICLE II

PROTECTION OF INFORMATION

2.1 Disclosure to and Property of the Company. For purposes of this Article II, the term “the Company” shall include the Company and any of its affiliates, and any reference to “employment” or similar terms shall include a director and/or consulting relationship. All information, trade secrets, designs, ideas, concepts, improvements, product developments, discoveries and inventions, whether patentable or not, that are conceived, made, developed, disclosed to 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 the Company’s or any of its affiliates’ businesses, trade secrets, products or services (including, without limitation, all such information relating to corporate opportunities, strategies, business plans, product specifications, 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 the customer’s organizations or within the organization of acquisition prospects, or production, marketing and merchandising techniques, prospective names and marks) and all writings or materials of any type embodying any of such information, ideas, concepts, improvements, discoveries, inventions and other similar forms of expression (collectively, “Confidential Information”) shall be disclosed to the Company and are and shall be the sole and exclusive property of the Company or its affiliates, as applicable. 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 (or its affiliates). Executive agrees to perform all actions reasonably requested by the Company or its affiliates to establish and confirm such exclusive ownership. Upon Executive’s Termination of Employment, for any reason, Executive

EXHIBIT 10.5

promptly shall deliver such Confidential Information and Work Product, and all copies thereof, to the Company.

2.2 Disclosure to Executive. The Company has and will disclose to Executive and place Executive in a position to have access to or develop Confidential Information and Work Product of the Company (or its affiliates); and has and will entrust Executive with business opportunities of the Company (or its affiliates); and has and will place Executive in a position to develop business good will on behalf of the Company (or its affiliates).

2.3 No Unauthorized Use or Disclosure.

(c) At the request of the Company at any time, Executive agrees to deliver to the Company all Confidential Information that Executive may possess or control. Executive agrees that all Confidential Information of the Company (whether now or hereafter existing) conceived, discovered or made by Executive during the period of Executive’s employment by the Company exclusively belongs to the Company (and not to Executive), and upon request by the Company for specified Confidential Information, 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 Article II. As a result of Executive’s employment by the Company, 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 the Company and its affiliates. Executive also agrees to preserve and protect the confidentiality of such third party Confidential Information and Work Product.

(d) Nothing in this Agreement (including Article III below) will prevent Executive from: (i) reporting possible violations of applicable law to any governmental agency or entity; or (ii) making disclosures that are protected under the whistleblower provisions of applicable law. For the avoidance of doubt, nothing herein shall prevent Executive from making a disclosure of a trade secret that: (A) is made in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, an individual who files a lawsuit for retaliation by an employer of reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (X) files any document containing the trade secret under seal; and (Y) does not disclose the trade secret, except pursuant to court order.

EXHIBIT 10.5

2.4 Ownership by the Company. If, during Executive’s employment by the Company, 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, or acquisitions, computer programs, E-mail, voice mail, electronic databases, drawings, maps, architectural renditions, models, manuals, brochures, or the like) relating to 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 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 relating to the Company’s business, products, or services 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 a motion picture or other 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 the work relating to the Company’s business, products, or services 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 during Executive’s employment by the Company, 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.

2.5 Assistance by Executive. During the period of Executive’s employment by the Company, Executive shall assist the Company and its nominee, at any time, in the protection of the Company’s or its affiliates’ worldwide right, title and interest in and to Confidential Information and Work Product and the execution of all formal assignment documents requested by the Company or its nominee(s) and the execution of all lawful oaths and applications for patents and registration of copyright in the United States and foreign countries. For the period of 2 years after Executive’s Termination of Employment, at the request from time to time and expense of the Company or its affiliates, Executive shall assist the Company or its nominee(s) in the protection of the Company’s or its affiliates’ worldwide right, title and interest in and to Confidential Information and Work Product and the execution of all formal assignment documents requested by the Company or its nominee and the execution of all lawful oaths and applications for patents and registration of copyright in the United States and foreign countries.

2.6 Remedies. Executive acknowledges that money damages would not be a sufficient remedy for any breach of this Article II by Executive, and the Company or its affiliates shall be entitled to enforce the provisions of this Article II by terminating Severance Benefits then owing to Executive and to specific performance and injunctive relief as remedies for such breach or any threatened breach; provided, that, to the extent the Company receives monetary damages from Executive, such amounts shall not exceed the total value of Severance Benefits Executive received. Such remedies shall not be deemed the exclusive remedies for a breach of this Article II but shall be in addition to all remedies available at law or in equity, including the recovery of damages from Executive and Executive’s agents. However, if it is determined that Executive has not committed a breach of this Article II, then the Company shall resume Severance Benefits due under the Plan and pay to Executive and Executive’s spouse, if applicable, all Severance Benefits that had been suspended pending such determination.

ARTICLE III

STATEMENTS CONCERNING THE COMPANY

EXHIBIT 10.5

affiliates’ directors, officers, employees, consultants, agents or representatives in a false light before the public. The Company agrees that the members of the Board and the Company’s named executive officers, while serving in such capacity for the Company, shall not make negative comments about Executive or otherwise disparage Executive in any manner that is likely to be harmful to Executive’s business reputation. The foregoing shall not be violated by truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), and the foregoing limitation on the Company’s executives and directors shall not be violated by statements that they in good faith believe are necessary or appropriate to make in connection with performing their duties and obligations to the Company.

3.2 Enforcement Rights. A violation or threatened violation of this Article III may be enjoined by the courts. The rights afforded the Company and its affiliates under this provision are in addition to any and all rights and remedies otherwise afforded by law.

ARTICLE IV

NON-COMPETITION AGREEMENT

4.1 Definitions. As used in this Article IV, the following terms shall have the following meanings:

“Business” means (a) during the period of Executive’s employment by the Company, the core products and services provided by the Company and its affiliates during such period and other products and services that are functionally equivalent to the foregoing, and (b) during the portion of the Prohibited Period that begins on Executive’s Termination of Employment, the products and services provided by the Company and its affiliates at the time of such Termination of Employment and other products and services that are functionally equivalent to the foregoing.

“Prohibited Period” means the period during which Executive is employed by the Company and a period of 2 years following Executive’s Termination of Employment.

EXHIBIT 10.5

Executive by the Company or its affiliates or created or developed by Executive for the Company or its affiliates, to protect the business goodwill of the Company or its affiliates developed through the efforts of Executive and/or the business opportunities disclosed or entrusted to Executive by the Company or its affiliates and as an additional incentive for the Company to enter into this Agreement and provide Severance Benefits.

(a) Subject to the exceptions set forth in Section 4.2(b) below, Executive expressly covenants and agrees that during the Prohibited Period (i) Executive will refrain from carrying on or engaging in, directly or indirectly, any Competing Business in the Restricted Area and (ii) Executive will not, and Executive will cause Executive’s affiliates not to, directly or indirectly, own, manage, operate, join, become an employee of, partner in, owner or member of (or an independent contractor to), control or participate in, be connected with or loan money to, sell or lease equipment or property to, or otherwise be affiliated with any business, individual, partnership, firm, corporation or other entity which engages in a Competing Business in the Restricted Area.

(b) Notwithstanding the restrictions contained in Section 4.2(a) above, Executive or any of Executive’s affiliates may own an aggregate of not more than 2% of the outstanding stock of any class of any corporation engaged in a Competing Business, if such stock is listed on a national securities exchange or regularly traded in the over-the-counter market by a member of a national securities exchange, without violating the provisions of Section 4.2(a) above, provided that neither Executive nor any of Executive’s affiliates has the power, directly or indirectly, to control or direct the management or affairs of any such corporation and is not involved in the management of such corporation.

(d) The restrictions contained in this Section 4.2 shall not apply to any product or service that the Company provided during Executive’s employment but that the Company no longer provides at Executive’s Termination of Employment.

4.3 Relief. Executive and the Company agree and acknowledge that the limitations as to time, geographical area and scope of activity to be restrained as set forth in Section 4.2 above are reasonable and do not impose any greater restraint than is necessary to protect the legitimate business interests of the Company. Executive and the Company also acknowledge that money damages would not be sufficient remedy for any breach of this Article IV by Executive, and the Company or its affiliates shall be entitled to enforce the provisions of this Article IV by terminating Severance Benefits then owing to Executive and to specific performance and injunctive relief as remedies for such breach or any threatened breach; provided, that, to the extent the Company receives monetary damages from Executive, such amounts shall not exceed the total value of Severance Benefits Executive received. Such remedies shall not be deemed the exclusive remedies for a breach of this Article IV but shall be in addition to all remedies available at law or in equity, including the recovery of damages from Executive and Executive’s agents. However, if it is determined that Executive has not committed a breach of this Article IV, then the Company shall resume the Severance Benefits due under the Plan and pay to Executive all Severance Benefits that had been suspended pending such determination.

EXHIBIT 10.5

4.4 Reasonableness; Enforcement. Executive hereby represents to the Company that Executive has read and understands, and agrees to be bound by, the terms of this Article IV. Executive acknowledges that the geographic scope and duration of the covenants contained in this Article IV are the result of arm’s-length bargaining and are fair and reasonable in light of (a) the nature and wide geographic scope of the operations of the Business, (b) Executive’s level of control over and contact with the Business in all jurisdictions in which it is conducted, (c) the fact that the Business is conducted throughout the Restricted Area and (d) the amount of Confidential Information that Executive is receiving in connection with the performance of Executive’s duties hereunder. It is the desire and intent of the parties that the provisions of this Article IV be enforced to the fullest extent permitted under applicable Legal Requirements, whether now or hereafter in effect and therefore, to the extent permitted by applicable Legal Requirements, Executive and the Company hereby waive any provision of applicable Legal Requirements that would render any provision of this Article IV invalid or unenforceable.

4.5 Reformation. The Company and Executive agree that the foregoing restrictions are reasonable under the circumstances and that any breach of the covenants contained in this Article IV would cause irreparable injury to the Company. Executive understands that the foregoing restrictions may limit Executive’s ability to engage in certain businesses anywhere in the Restricted Area during the Prohibited Period, but acknowledges that Executive will receive sufficient consideration from the Company to justify such restriction. Further, Executive acknowledges that Executive’s skills are such that Executive can be gainfully employed in non-competitive employment, and that the agreement not to compete will not prevent Executive from earning a living. Nevertheless, if any of the aforesaid restrictions are found by a court of competent jurisdiction to be unreasonable, or overly broad as to geographic area or time, or otherwise unenforceable, the parties intend for the restrictions herein set forth to be modified by the court making such determination so as to be reasonable and enforceable and, as so modified, to be fully enforced. By agreeing to this contractual modification prospectively at this time, the Company and Executive intend to make this provision enforceable under the law or laws of all applicable States, Provinces and other jurisdictions so that the entire agreement not to compete and this Agreement as prospectively modified shall remain in full force and effect and shall not be rendered void or illegal. Such modification shall not affect Severance Benefits to Executive under the Plan.

ARTICLE V

DISPUTE RESOLUTION

EXHIBIT 10.5

process to enforce the provisions of this Agreement, the award of an arbitrator, or equitable relief granted by an arbitrator, the party seeking enforcement shall be entitled to recover from the other party all costs of litigation including, but not limited to, reasonable attorney’s fees and court costs. All proceedings conducted pursuant to this agreement to arbitrate, including any order, decision or award of the arbitrator, shall be kept confidential by all parties. Executive and the Company explicitly recognize that no provision of this Article V shall prevent either party from seeking to resolve any dispute relating to Article II or Article IV of this Agreement in a court of law. Executive and the Company further acknowledge and agree that a court of competent jurisdiction shall have the power to maintain the status quo pending the arbitration of any dispute under this Article V, and this Article V shall not require the arbitration of an application for emergency or temporary injunctive relief by either party pending arbitration; provided, however, that the remainder of any such dispute beyond the application for emergency or temporary injunctive relief shall be subject to arbitration under this Article V.

5.2 Waiver of Jury Trial. EXECUTIVE ACKNOWLEDGES THAT, BY SIGNING THIS AGREEMENT, EXECUTIVE IS WAIVING ANY RIGHT THAT EXECUTIVE MAY HAVE TO A JURY TRIAL OR, EXCEPT AS EXPRESSLY PROVIDED HEREIN, A COURT TRIAL OF ANY CLAIM ALLEGED BY EXECUTIVE.

ARTICLE VI

MISCELLANEOUS

6.1 Notices. For purposes of this Agreement, notices and all other communications provided for herein shall be in writing and shall be deemed to have been duly given (a) when received if delivered personally or by courier, (b) on the date receipt is acknowledged if delivered by certified mail, postage prepaid, return receipt requested or (c) one day after transmission if sent by facsimile transmission with confirmation of transmission, as follows:


If to Executive, addressed to:			the last known residential address reflected in the Company’s records.

If to the Company, addressed to:			Extraction Oil & Gas, Inc.
			370 17th Street, Suite 5300
			Denver, CO 80202
			Attention: General Counsel

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.

6.2 Applicable Law; Submission to Jurisdiction.

(a) This Agreement is entered into under, and shall be governed for all purposes by, the laws of the State of Colorado, without regard to conflicts of laws principles thereof.

6.3 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.

EXHIBIT 10.5

6.4 Severability. If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of that provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect.

6.5 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.

6.6 Headings. The Section headings have been inserted for purposes of convenience and shall not be used for interpretive purposes.

6.7 Affiliate. As used in this Agreement, the term “affiliate” as used with respect to a particular person or entity shall mean any other person or entity which owns or controls, is owned or controlled by, or is under common ownership or control with, such particular person or entity.

6.8 Successors; Assigns; Third Party Beneficiaries. This Agreement shall be binding upon and inure to the benefit of the Company and any successor of the Company. In addition, the Company may assign this Agreement to any other affiliate of the Company at any time without the consent of Executive, and any assign of the Company shall be deemed to be the Company for purposes of this Agreement. Except as provided in the foregoing sentences of this Section 6.8, this Agreement and the rights and obligations of the parties hereunder are personal, and neither this Agreement nor any right, benefit, or obligation of either party hereto shall be subject to voluntary or involuntary assignment, alienation, or transfer, whether by operation of law or otherwise, without the prior written consent of the other party. Each affiliate of the Company shall be a third party beneficiary of, and may directly enforce, Executive’s obligations under Article II, Article III and Article IV of this Agreement.

6.9 Term. Termination of this Agreement shall not affect any right or obligation of any party which is accrued or vested prior to such termination. Without limiting the scope of the preceding sentence, the provisions of Articles II, III, IV, and V of this Agreement shall survive any termination of Executive’s employment relationship and/or of this Agreement.

6.10 Entire Agreement. Except as provided in any signed written agreement contemporaneously or hereafter executed by the Company and Executive, 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 employment of Executive by the Company. 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 are hereby null and void and of no further force and effect.

6.11 Modification; Waiver. Any modification to or waiver of this Agreement will be effective only if it is in writing and signed by the parties to this Agreement.

[Signatures begin on next page.]

EXHIBIT 10.5

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

EXTRACTION OIL & GAS, INC.

By:

Name:

Title:

EXECUTIVE

SIGNATURE PAGE TO

RESTRICTIVE COVENANT AGREEMENT

EXHIBIT 10.5

SCHEDULE B TO EXECUTIVE SEVERANCE PLAN

The Non-CIC Applicable Factor is determined based on the Plan Administrator’s designation of the Participant into one of the tiers set forth below as follows:


Position			Non-CIC Applicable Factor
Tier I			24
Tier II			20
Tier III			16
Tier IV			9

EXHIBIT 10.5

SCHEDULE C TO EXECUTIVE SEVERANCE PLAN

The CIC Applicable Factor is determined based on the Plan Administrator’s designation of the Participant into one of the tiers set forth below as follows:


Position			CIC Applicable Factor
Tier I			36
Tier II			30
Tier III			24
Tier IV			16

EXHIBIT 10.6

PARTICIPATION AGREEMENT

EXTRACTION OIL & GAS, INC.

EXECUTIVE SEVERANCE PLAN

IN WITNESS WHEREOF, each of the parties has executed this Participation Agreement, in the case of the Company by its duly authorized officer, as of the Agreement Date.

EXTRACTION OIL & GAS, INC. EXECUTIVE

Sign name: Sign name:

Print name: Print name:

Title:

EXHIBIT 10.6

EXHIBIT A TO PARTICIPATION AGREEMENT

RESTRICTIVE COVENANT AGREEMENT

W I T N E S S E T H:

WHEREAS, the Company maintains an Executive Severance Plan (the “Plan”).

WHEREAS, Executive is required to enter into this Agreement as a condition to participating in the Plan.

NOW, THEREFORE, for and in consideration of the mutual promises, covenants and obligations contained herein, the Company and Executive agree as follows:

ARTICLE I

DEFINITIONS

In addition to the terms defined in the body of this Agreement, for purposes of this Agreement, capitalized words shall have the meanings from the Plan.

ARTICLE II

PROTECTION OF INFORMATION

EXHIBIT 10.6

discoveries, inventions and other similar forms of expression (collectively, “Work Product”) are and shall be the sole and exclusive property of the Company (or its affiliates). Executive agrees to perform all actions reasonably requested by the Company or its affiliates to establish and confirm such exclusive ownership. Upon Executive’s Termination of Employment, for any reason, Executive promptly shall deliver such Confidential Information and Work Product, and all copies thereof, to the Company.

2.3 No Unauthorized Use or Disclosure.

(c) At the request of the Company at any time, Executive agrees to deliver to the Company all Confidential Information that Executive may possess or control. Executive agrees that all Confidential Information of the Company (whether now or hereafter existing) conceived, discovered or made by Executive during the period of Executive’s employment by the Company exclusively belongs to the Company (and not to Executive), and upon request by the Company for specified Confidential Information, 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 Article II. As a result of Executive’s employment by the Company, 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 the Company and its affiliates. Executive also agrees to preserve and protect the confidentiality of such third party Confidential Information and Work Product.

EXHIBIT 10.6

violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, an individual who files a lawsuit for retaliation by an employer of reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (X) files any document containing the trade secret under seal; and (Y) does not disclose the trade secret, except pursuant to court order.

EXHIBIT 10.6

ARTICLE III

STATEMENTS CONCERNING THE COMPANY

3.1 Statements Concerning the Company. Subject to Section 2.3(d) above, Executive shall refrain, both during and after the termination of the employment relationship, from publishing any oral or written statements about the Company, any of its affiliates or any of the Company’s or such affiliates’ directors, officers, employees, consultants, agents or representatives that (a) are slanderous, libelous or defamatory, (b) disclose Confidential Information of the Company, any of its affiliates or any of the Company’s or any such affiliates’ business affairs, directors, officers, employees, consultants, agents or representatives, or (c) place the Company, any of its affiliates, or any of the Company’s or any such affiliates’ directors, officers, employees, consultants, agents or representatives in a false light before the public. The Company agrees that the members of the Board and the Company’s named executive officers, while serving in such capacity for the Company, shall not make negative comments about Executive or otherwise disparage Executive in any manner that is likely to be harmful to Executive’s business reputation. The foregoing shall not be violated by truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), and the foregoing limitation on the Company’s executives and directors shall not be violated by statements that they in good faith believe are necessary or appropriate to make in connection with performing their duties and obligations to the Company.

ARTICLE IV

NON-COMPETITION AGREEMENT

4.1 Definitions. As used in this Article IV, the following terms shall have the following meanings:

“Business” means (a) during the period of Executive’s employment by the Company, the core products and services provided by the Company and its affiliates during such period and other products and services that are functionally equivalent to the foregoing, and (b) during the portion of the Prohibited Period that begins on Executive’s Termination of Employment, the products and services provided by the Company and its affiliates at the time of such Termination of Employment and other products and services that are functionally equivalent to the foregoing.

EXHIBIT 10.6

standards or controls, energy regulations and occupational, safety and health standards or controls including those arising under environmental laws) of any Governmental Authority.

“Prohibited Period” means the period during which Executive is employed by the Company and a period of 2 years following Executive’s Termination of Employment.

4.2 Non-Competition; Non-Solicitation. Executive and the Company agree to the non-competition and non-solicitation provisions of this Article IV in consideration for the Confidential Information provided by the Company to Executive pursuant to Article II of this Agreement, to protect the trade secrets and confidential information of the Company or its affiliates disclosed or entrusted to Executive by the Company or its affiliates or created or developed by Executive for the Company or its affiliates, to protect the business goodwill of the Company or its affiliates developed through the efforts of Executive and/or the business opportunities disclosed or entrusted to Executive by the Company or its affiliates and as an additional incentive for the Company to enter into this Agreement and provide Severance Benefits.

EXHIBIT 10.6

ARTICLE V

DISPUTE RESOLUTION

5.1 Arbitration. Except as otherwise provided in this Article V, any and all claims or disputes between Executive and the Company or its parents, subsidiaries and affiliates (including, without limitation, the validity, scope, and enforceability of this Article V and claims arising under any federal, state or local law prohibiting discrimination in employment or governing the employment relationship in any way) shall be submitted for final and binding arbitration by a single arbitrator in Denver, Colorado, in accordance with the rules for resolution of employment disputes of the American Arbitration Association (“AAA”). The arbitrator shall have the power to gather such materials, information, testimony, and evidence as he or she deems relevant to the dispute before him or her, and each party will provide such materials, information, testimony, and evidence requested by the arbitrator, except to the extent any information so requested is subject to an attorney-client or other privilege. The arbitrator shall apply the substantive law of the State of Colorado (excluding Colorado choice-of-law principles that might call for the application of some other state’s law), or federal law, or both as applicable to the claims asserted. The results of the arbitration and the decision of the arbitrator will be final and binding on the parties and each party agrees and acknowledges that these results shall be enforceable in a court of law of competent jurisdiction; provided that the parties agree that the arbitrator and any court enforcing the award of the arbitrator shall not have the right or authority to award punitive or exemplary damages to any disputing party. No demand for arbitration may be made after the date when the institution of legal or equitable proceedings based on such claim or dispute would be barred by the applicable statute of limitations. In the event either party must resort to the judicial process to enforce the provisions of this Agreement, the award of an arbitrator, or equitable relief granted by an arbitrator, the party seeking enforcement shall be entitled to recover from the other party all costs of litigation including, but not limited to, reasonable attorney’s fees and court costs. All proceedings conducted pursuant to this agreement to arbitrate, including any order, decision or award of the arbitrator, shall be kept confidential by all parties. Executive and the Company explicitly recognize that no provision of this Article V shall prevent either party from seeking to resolve any dispute relating to Article II or Article IV of this Agreement in a court of law. Executive and the Company further acknowledge and agree that a court of competent jurisdiction shall have the power to maintain the status quo pending the arbitration of any dispute under this Article V, and this Article V shall not require the arbitration of an application for emergency or temporary injunctive relief by either party pending arbitration; provided, however, that the remainder of any such dispute beyond the application for emergency or temporary injunctive relief shall be subject to arbitration under this Article V.

ARTICLE VI

MISCELLANEOUS

EXHIBIT 10.6


If to Executive, addressed to:			the last known residential address reflected in the Company’s records.

If to the Company, addressed to:			Extraction Oil & Gas, Inc.
			370 17th Street, Suite 5300
			Denver, CO 80202
			Attention: General Counsel

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.

6.2 Applicable Law; Submission to Jurisdiction.

(a) This Agreement is entered into under, and shall be governed for all purposes by, the laws of the State of Colorado, without regard to conflicts of laws principles thereof.

6.5 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.

6.6 Headings. The Section headings have been inserted for purposes of convenience and shall not be used for interpretive purposes.

EXHIBIT 10.6

beneficiary of, and may directly enforce, Executive’s obligations under Article II, Article III and Article IV of this Agreement.

6.11 Modification; Waiver. Any modification to or waiver of this Agreement will be effective only if it is in writing and signed by the parties to this Agreement.

[Signatures begin on next page.]

EXHIBIT 10.6

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

EXTRACTION OIL & GAS, INC.

By:

Name:

Title:

EXECUTIVE

SIGNATURE PAGE TO

RESTRICTIVE COVENANT AGREEMENT

EXHIBIT 99.1

Extraction Announces Management Transition and Appoints Tom Tyree as Executive Chairman

DENVER – March 5, 2020 (GLOBE NEWSWIRE) -- Extraction Oil & Gas, Inc. (NASDAQ: XOG) (“Extraction” or the “Company”) today announced that Mark Erickson, Chief Executive Officer and Chairman of the Board, is departing from the Company. In conjunction with Mr. Erickson’s departure from Extraction’s Board of Directors, the Company has appointed Thomas B. Tyree, Jr. as Executive Chairman. In addition, Matt Owens has been named permanent CEO and will also maintain his roles as President and member of the Board. These changes in leadership roles are effective March 4, 2020.

As Executive Chairman, Mr. Tyree will work with Extraction’s Board and management team to formulate strategy and oversee the operations of the Company, working in close coordination with Extraction’s President and CEO, Matt Owens.

“On behalf of myself, Extraction’s Board of Directors and all our employees, I would like to thank Mark Erickson for his invaluable contributions to the Company’s growth and maturation since he and I founded Extraction together back in 2012. We all wish him and his family the very best,” said President and CEO, Matt Owens.

“While we are saddened by Mark’s departure, we are excited to welcome Tom Tyree to our Board of Directors as Executive Chairman. With decades of energy and finance industry experience, Tom brings a wealth of financial knowledge and a strategic understanding of our business that we expect will greatly benefit all of Extraction’s stakeholders,” Owens said.

Thomas B. Tyree, Jr.

Mr. Tyree currently serves as a director of Antero Resources Corporation and as non-executive Chairman of the Board of Northwoods Energy LLC, a private oil and gas company with assets in Wyoming’s Powder River Basin. Mr. Tyree was previously Northwoods’ founder, CEO, and Executive Chairman, from January 2018 until April 2019. Mr. Tyree also served as a Director of Bonanza Creek Energy from April 2017 through March 2020. Before that, he served as President, Chief Financial Officer and member of the Board of Managers of Vantage Energy, LLC and as Chief Financial Officer of Bill Barrett Corporation. Prior to Bill Barrett, from 1989 to 2003, Mr. Tyree was an investment banker at Goldman, Sachs & Co., ultimately serving as Managing Director in the Energy Group. Mr. Tyree earned a Bachelor of Arts degree from Colgate University, where he currently serves as a member of its Board of Trustees. He also holds a Master of Business Administration degree from the Wharton School at the University of Pennsylvania.

Matthew R. Owens

Mr. Owens currently serves as President and has been acting CEO of the Company since April 2019 and is a member of the Board. Prior to founding the Company in 2012 with Mr. Erickson, Mr. Owens served as an Operations Engineer at PDC Energy and Gasco Energy. Mr. Owens holds a Bachelor of Science in Petroleum Engineering from the Colorado School of Mines.

EXHIBIT 99.1

Inducement Grant

In connection with his appointment, Mr. Tyree received a grant of 2,500,000 restricted stock units (at target, with the opportunity to earn up to a maximum of 3,750,000 restricted stock units) (“RSUs”). The RSUs were granted as an inducement material to Mr. Tyree becoming an employee of Extraction in accordance with NASDAQ Listing Rule 5635(c)(4). 1,250,000 of the RSUs will vest annually in three equal installments on the anniversary of the grant, contingent on Mr. Tyree’s continuous service through each vesting date. The remaining RSUs will be eligible to vest subject to the achievement of certain performance goals.

About Extraction Oil & Gas, Inc.

Denver-based Extraction Oil & Gas, Inc. is an independent energy exploration and development company focused on exploring, developing and producing crude oil, natural gas and NGLs primarily in the Wattenberg Field in the Denver-Julesburg Basin of Colorado. For further information, please visit www.extractionog.com. The Company's common stock is listed for trading on the NASDAQ under the symbol: “XOG.”

Forward Looking Statements

Certain statements contained in this press release constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included herein are forward-looking statements. These forward-looking statements are identified by their use of terms and phrases such as “may,” “expect,” “estimate,” “project,” “plan,” “believe,” “intend,” “achievable,” “anticipate,” “will,” “continue,” “potential,” “should,” “could,” and similar terms and phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they do involve certain assumptions, risks and uncertainties. These forward-looking statements represent our expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our control that could cause actual results to differ materially from the results discussed in the forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, we do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for us to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in the “Risk Factors” section of our most recent Form 10-K and Forms 10-Q filed with the SEC and in our other public filings and press releases. These and other factors could cause our actual results to differ materially from those contained in any forward-looking statement.

Investor Contact: Louis Baltimore, ir@extractionog.com, 720-974-7773

Media Contact: Brian Cain, info@extractionog.com, 720-974-7782