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EXHIBIT 10.1
 
U.S. Energy Corp.
Performance Compensation Plan
2015 Performance Period Matrix

Plan Objectives

The objectives of the Performance Compensation Plan (the "Plan") are to:

·
incentivize top level managers and senior management of U.S. Energy Corp ("US
Energy" or the "Company");

·
to improve shareholder value by accomplishing aggressive, yet realistic,
financial and production objectives;

·
encourage employees to contribute to the ultimate goal of improving shareholder
value by making participating employees eligible for an annual performance bonus
under the Plan; and

·
heavily weighting the compensation of senior management towards performance
based incentives.

Performance Period

The Performance Period shall be from January 1, 2015 to December 31, 2015.

Award Determination

The Compensation Committee and the Board shall have the authority, in their
discretion, to determine whether any bonuses have been earned under the Plan for
a particular Performance Period.  In addition to the Financial and Operation
Factors defined below, the Compensation Committee and the Board shall have the
authority, in their discretion; to impose an activation trigger (the "Bonus
Trigger") conditioning any awards under the Plan on the satisfaction of
designated performance criteria.  In the event the Bonus Trigger has not been
satisfied, the Compensation Committee and the Board shall have the authority, in
their discretion, to reduce or forgo any bonuses under the Plan.

2015 Award Levels

The Threshold, Target, and Maximum bonus awards (as a percentage of base salary)
for the 2015 Performance Period are provided below under "2015 Bonus Award
Matrix Criteria".

2015 Performance Metric

The performance metric utilized for 2015 will be Earnings before Interest,
Taxes, Depreciation and Amortization ("EBITDA").  The Compensation Committee
will establish a target level for the performance metric, the achievement of
which will result in earned incentives equal to 100% of the participant's target
award amount.  Additionally, the Compensation Committee, in its discretion, may
determine to reduce an award under the
 

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Plan even though certain objectives have been met.  See below 2015 Bonus Award
Matrix Criteria.

Payment of Awards

Payment of all bonuses under the Plan is to be made after the Form 10-K for the
year ended December 31, 2015 is filed, but before March 15, 2016.

2015 Bonus Award Matrix Criteria

Metric
 
% Allocated
 
Criteria
         
EBITDA
 
100%
 
100% for positive EBITDA for the year, per the audited consolidated financial
statements