exv10w10






EXHIBIT 10.10




Execution Copy




SERVICES AGREEMENT




by and between




Crusader Energy Group Inc.




and




Robert J. Raymond




 









 





SERVICES AGREEMENT




     THIS SERVICES AGREEMENT (this “Agreement”) is made and entered into effective as of
the closing of the transaction contemplated by the Contribution Agreement (as defined below) (the
“Effective Date”), by and between Crusader Energy Group Inc. (f/k/a Westside Energy
Corporation), a Nevada corporation (the “Company”), and Robert J. Raymond
(“Raymond”).



RECITALS:




     A. Raymond possesses valuable skills and knowledge in the field of business of the Company and
desires to be retained by the Company as non-executive Chairman of the Board on the terms and
conditions set forth in this Agreement.



     B. The Company desires to retain Raymond on the terms and conditions set forth in this
Agreement.



AGREEMENTS:




     In consideration of the premises and of the mutual covenants and agreements contained herein,
and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:



     1. Certain Definitions. As used in this Agreement, the following terms have the
meanings set forth below:



          (a) “Affiliate” means, with respect to any Person, any other Person that directly or
indirectly controls, is controlled by, or is under common control with the Person in question. As
used in this definition of “Affiliate,” the term “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of a
Person, whether through ownership of Voting Securities, by contract, or otherwise.




          (b) “Beneficial Owner” or “Beneficial Ownership” or “Beneficially
Owns” shall have the meaning ascribed to such terms in, or be interpreted in a manner
consistent with, Rule 13d-3 under the Exchange Act and any successor to such rule.




          (c) “Board” means the Board of Directors of the Company and any committee thereof.




          (d) “Cause” means Raymond’s:




               (i) commission of an act of fraud, embezzlement, mis-appropriation, willful misconduct, bad
faith or dishonesty against the Company;



               (ii) material breach of this Agreement which is not remedied within 30 days after receipt of
written notice from the Company specifically identifying the manner in which the Company believes
that Raymond has materially breached this Agreement;



 









 





               (iii) conviction, plea of no contest or nolo contendere, deferred adjudication or
unadjudicated probation for any felony or any crime involving moral turpitude; or



               (iv) violation of the Company’s substance abuse policy.



          (e) “Change in Control” means the occurrence of any of the following events:




               (i) Subject to the last paragraph of this definition, the acquisition by any Person or Group
of Beneficial Ownership of forty percent (40%) or more of either (x) the then outstanding shares of
Common Stock (the “Outstanding Company Stock”) or (y) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the election of
directors or similar governing body (the “Outstanding Company Voting Securities” and, together with
the Outstanding Company Stock, the “Company Securities”); or



               (ii) Members of the Incumbent Board cease to constitute at least a majority of the members of
the Board; or



               (iii) Consummation of a reorganization, merger, consolidation, sale or other disposition of
all or substantially all of the assets of the Company or an acquisition of assets of another
company (a “Business Combination”), in each case, unless, following such Business Combination, (A)
all or substantially all of the Persons who were the Beneficial Owners of Company Securities
immediately prior to such Business Combination Beneficially Own, directly or indirectly, more than
fifty percent (50%) of, respectively, the then outstanding shares of common stock or common equity
interests and the combined voting power of the then outstanding Voting Securities, as the case may
be, of the entity resulting from such Business Combination (including without limitation an entity
which as a result of such transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries) in substantially the same proportions
as their ownership, immediately prior to such Business Combination, of the Company Securities, (B)
no Person or Group (excluding any employee benefit plan (or related trust) of the Company or the
entity resulting from such Business Combination) Beneficially Owns, directly or indirectly, forty
percent (40%) or more of, respectively, the then outstanding shares of common stock or common
equity interests of the entity resulting from such Business Combination or the combined voting
power of the then outstanding Voting Securities of such entity except to the extent that such
ownership results solely from ownership of the Company that existed prior to the Business
Combination, and (C) at least a majority of the members of the board of directors or similar
governing body of the entity resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or



               (iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of
the Company.


Notwithstanding the foregoing clause (i) of this definition: (x) the following acquisitions
(whether the acquiring Person or Group acquires Beneficial Ownership of forty percent (40%) or



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more of the Outstanding Company Stock or Outstanding Company Voting Securities or any such
acquisition results in any other Person or Group (other than the acquiring Person or Group)
Beneficially Owning forty percent (40%) or more of the Outstanding Company Stock or Outstanding
Company Voting Securities) shall not constitute a Change in Control unless, following such
acquisition, any Person or Group (other than the acquiring Person or Group effecting the
acquisition pursuant to the following clauses (A) through (D)) who becomes the Beneficial Owner of
forty percent (40%) or more of the Outstanding Company Stock or Outstanding Company Voting
Securities as a result of one or more of such acquisitions shall thereafter acquire any additional
shares of Company Securities and, following such acquisition, Beneficially Owns forty percent (40%)
or more of either the Outstanding Company Stock or Outstanding Company Voting Securities, in which
case such acquisition shall constitute a Change in Control: (A) any acquisition directly from the
Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any entity controlled by the Company or
(D) any acquisition by any entity pursuant to a transaction which complies with clauses (A), (B)
and (C) of the foregoing clause (iii) of this definition; and (y) the acquisition of Beneficial
Ownership of shares of Common Stock by the Crusader Parent Entities pursuant to the Contribution
Agreement, the corresponding acquisition of Beneficial Ownership of shares of Common Stock by any
other Person or Group deemed to Beneficially Own the Common Stock so acquired by the Crusader
Parent Entities (any such Person and/or Group, collectively with the Crusader Parent Entities and
the Crusader Distributees, the “Crusader Group”) and the acquisition of Beneficial Ownership of
shares of Common Stock as a result of the distribution by a Crusader Parent Entity to Crusader
Distributees of shares of Common Stock acquired pursuant to the Contribution Agreement or directly
from the Company prior to the date of the Contribution Agreement shall not constitute a Change of
Control, provided that if, (1) for so long as the shares of Common Stock Beneficially Owned by any
member of the Crusader Group equals or exceeds forty percent (40%) of the Outstanding Company Stock
or the Outstanding Company Voting Securities, such member of the Crusader Group shall obtain
Beneficial Ownership of shares of Common Stock (other than as a result of any acquisition described
in the foregoing clauses (A) through (D) of this paragraph or pursuant to an award issued under any
equity based compensation plan of the Company, including without limitation the LTIP) representing
one percent (1%) or more of the Outstanding Company Stock or Outstanding Company Voting Securities
or (2) at any time after such member of the Crusader Group shall cease to Beneficially Own forty
percent (40%) or more of the Outstanding Company Stock and Outstanding Company Voting Securities,
such member of the Crusader Group shall obtain Beneficial Ownership of shares of Common Stock
(other than as a result of any acquisition described in the foregoing clauses (A) through (D) of
this paragraph or pursuant to an award issued under any equity based compensation plan of the
Company, including without limitation the LTIP) representing forty percent (40%) or more of either
the Outstanding Company Stock or Outstanding Company Voting Securities, then in the case of either
(1) or (2) a Change of Control shall be deemed to occur.




          (f) “Common Stock” means the Company’s common stock, par value $.01 per share, and
such other securities as may be substituted (or resubstituted) for such Common Stock.




          (g) “Compensation Committee” means the Compensation Committee of the Board.




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          (h) “Contribution Agreement” means the Contribution Agreement among the Company and
Crusader Management Corporation, David D. Le Norman, Knight Energy Management Holding Company, LLC,
Knight Energy Group II Holding Company, LLC, Knight Energy Group I Holding Co., LLC, Crusader
Energy Group Holding Co., LLC, Hawk Energy Fund I Holding Company, LLC, RCH Energy Opportunity Fund
I, L.P., Knight Energy Group, LLC, Knight Energy Group II, LLC, Knight Energy Management, LLC, Hawk
Energy Fund I, LLC, RCH Upland Acquisition, LLC and Crusader Energy Group, LLC dated as of December
31, 2007.




          (i) “Crusader Distributees” means holders of equity interests in any Crusader Parent
Entity who receives a distribution from such Crusader Parent Entity of shares of Common Stock
acquired pursuant to the Contribution Agreement or directly from the Company prior to the date of
the Contribution Agreement.




          (j) “Crusader Parent Entities” has the meaning set forth in the Contribution
Agreement.




          (k) “Disability” means Raymond’s inability to perform, with or without reasonable
accommodations, the essential functions of Raymond’s position hereunder for a period of 180
consecutive days due to mental or physical incapacity, as determined by mutual agreement of a
physician selected by the Company or its insurers and a physician selected by Raymond; provided,
however, that if the opinion of the Company’s physician and Raymond’s physician conflict, the
Company’s physician and Raymond’s physician shall together agree upon a third physician, whose
opinion shall be binding. The foregoing definition of “Disability” is not intended to and shall
not affect the definition of “disability” or any similar term in any insurance policy the Company
or any of its Subsidiaries may provide. Notwithstanding the foregoing definition of Disability,
Raymond will not be considered to have a Disability under any provision of this Agreement that
would trigger the payment of deferred compensation within the meaning of Section 409A of the Code
unless Raymond’s Disability also meets the Section 409A definition of Disability.




          (l) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.




          (m) “Good Reason” means, subject to the terms and provisions of this Agreement, the
occurrence of one or more of the following events:




               (i) any removal of Raymond from the office of Chairman of the Board of the Company except, in
any such case, in connection with the termination of Raymond’s retention hereunder by the Company
for Disability or for Cause or by Raymond other than for Good Reason;



               (ii) any termination or material reduction of a material benefit under any Investment Plan or
Welfare Plan in which Raymond participates unless (A) there is substituted a comparable benefit
that is economically substantially equivalent to the terminated or reduced benefit prior to such
termination or reduction or (B) benefits under such Investment Plan



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or Welfare Plan are terminated or reduced with respect to all Raymond’s previously granted
benefits thereunder;




               (iii) any reduction in Raymond’s Annual Base Salary;



               (iv) any failure by the Company to comply with any of the provisions of Section 3(b);



               (v) without limiting the generality of the foregoing, any material breach by the Company of
this Agreement other than an isolated, insubstantial, and inadvertent failure not occurring in bad
faith and which is remedied by the Company promptly after receipt of notice thereof given by
Raymond; or



               (vi) a Change in Control,



          (n) “Group” shall have the meaning ascribed to such term in section 13(d)(3) or
14(d)(2) of the Exchange Act.




          (o) “Incumbent Board” shall mean individuals who, as of the Effective Date, constitute
the Board and any other individual who becomes a director of the Company after that date and whose
election or appointment by the Board or nomination for election by the Company’s stockholders was
approved by a vote of at least a majority of the directors then comprising the Incumbent Board.




          (p) “LTIP” means the 2008 Long-Term Incentive Plan of the Company.




          (q) “Person” means any individual, partnership, limited liability partnership, joint
venture, corporation, limited liability company, trust, association, or other entity or
organization.




          (r) “Pro Rata Bonus” means the amount equal to the product of (i) the amount of the
Annual Bonus (as defined in Section 3(b)(ii)), if any, to which Raymond would have been
entitled for the calendar year in which Raymond’s Date of Termination occurs if Raymond was not
terminated during such calendar year, multiplied by (ii) a fraction, the numerator of which
is the number of days that have elapsed since the beginning of such calendar year through (but not
including) Raymond’s Date of Termination, and the denominator of which is the total number of days
in such calendar year. The amount, if any, of the Annual Bonus to which Raymond would have been
entitled for the calendar year in which the Date of Termination occurs shall be determined by the
Compensation Committee in its sole reasonable discretion; provided, however, that for purposes of
determining the amount of the Pro Rata Bonus in connection with a termination of Raymond’s
retention upon a Change of Control, Raymond shall be deemed to have been entitled to an Annual
Bonus of not less than the amount of the last Annual Bonus awarded to Raymond prior to such Change
in Control, and provided further however that any determination by the Compensation Committee as to
satisfaction of a performance standard shall be made in the same manner as such determination is
made for the other similarly-situation executives of the Company.




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          (s) “Subsidiary” means, with respect to any Person, any corporation or other entity of
which a majority of the voting power of the voting equity securities or equity interest is owned,
directly or indirectly, by that Person.




          (t) “Voting Securities” means any securities that vote generally in the election of
directors, in the admission of general partners, or in the selection of any other similar governing
body.




          (u) “Without Cause” means a termination by the Company of Raymond’s retention
hereunder during the Term at the Company’s sole discretion for any reason other than a termination
based upon Cause, death or Disability; provided that, “without Cause” does not include termination
of this Agreement and Raymond’ s retention pursuant to Section 2.




     2. Term; Non-Renewal of Term. Subject to the terms and provisions of this Agreement,
the Company hereby agrees to retain Raymond, and Raymond hereby agrees to be retained by the
Company, for the period (the “Term”) commencing on the Effective Date and, unless Raymond
is sooner terminated in accordance with the terms hereof, expiring at 5:00 p.m., Oklahoma City,
Oklahoma time, on December 31, 2011; provided, however, that on January 1, 2009, and on each
January 1 occurring thereafter, the Term shall automatically (without any action by either party)
be extended for one additional calendar year unless, at least 30 days prior to each such January 1,
the Company or Raymond shall have given written notice (a “Non-Renewal Notice”) that it or
Raymond, as applicable, does not wish to extend this Agreement (a “Non-Renewal”). Either
party may elect not to renew this Agreement. The term “Term,” as utilized in this Agreement, shall
refer to the Term as so automatically extended. The Term shall expire as a result of any
Non-Renewal at 5:00 p.m., Oklahoma City, Oklahoma time, on the last day of the Term during which a
Non-Renewal Notice is given, and the retention of Raymond shall terminate at that time.



     3. Terms.



          (a) Position and Duties.




               (i) During the Term, Raymond shall serve as Chairman of the Board of the Company. In so
doing, Raymond shall have such powers and duties as may be assigned from time to time by the Board,
so long as such powers and duties are reasonable and customary for a non-executive chairman of the
board of an enterprise comparable to the Company.



               (ii) During the Term, and excluding any periods of vacation and sick leave to which Raymond is
entitled, Raymond agrees to (a) use Raymond’s reasonable efforts to perform diligently, faithfully,
effectively and efficiently his responsibilities, and (b) use Raymond’s reasonable efforts to
promote the interests of the Company.



               (iii) Raymond shall not be an employee of the Company, and may engage in any other business
endeavors during the Term, including those which compete with the Company; provided, however, that
the foregoing shall not be deemed to modify or limit Raymond’s covenants, agreements and
obligations under Section 3(a)(ii), Section 8 or Section 9. Raymond is an
independent contractor with respect to the services he provides to the Company.



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          (b) Compensation.




               (i) Annual Base Salary. During the Term, Raymond shall receive an annual base salary
(“Annual Base Salary”), which shall be paid bi-weekly in accordance with the customary
payroll practices for executives of the Company, in the initial amount of $100,000 per year. At
least annually (by no later than January 31 of each year) during the Term, the Compensation
Committee shall review the Annual Base Salary of Raymond and may increase (but not decrease) the
Annual Base Salary by such amount as the Compensation Committee shall deem appropriate. The term
“Annual Base Salary” as used in this Agreement shall refer to the Annual Base Salary as it may be
so increased.



               (ii) Annual Bonus. During the Term, Raymond shall be eligible to receive an annual
bonus, in addition to the Annual Base Salary, (each, an “Annual Bonus”), in such amounts
and subject to such requirements as shall be determined by the Compensation Committee.



               (iii) Option. Raymond shall be entitled to exercise the option to purchase shares of
common stock, par value $0.01 per share of the Company issued to Raymond pursuant to Section 6(i)
of the Company’s 2008 Long Term Incentive Plan (the “Option”). The Option may be exercised only in
the time and manner described in the Option.



               (iv) Incentive, Savings, Stock Option and Retirement Plans. During the Term, Raymond
shall be entitled to participate in all incentive, savings, stock option, equity-based, profit
sharing and retirement plans, practices, policies and programs applicable generally to directors of
the Company (“Investment Plans”), subject to all of the terms and conditions of such
Investment Plans.



               (v) Welfare Benefit Plans. During the Term, Raymond and Raymond’s family shall be
eligible for participation in and shall receive all benefits under the welfare benefit plans,
practices, policies and programs (“Welfare Plans”) provided by the Company (including,
without limitation, medical, prescription, dental, short-term and long-term disability, salary
continuance, executive life, group life, accidental death and travel accident insurance plans and
programs) to the extent applicable generally to other directors of the Company, subject to all of
the terms and conditions of such Welfare Plans.



               (vi) Expenses. During the Term, Raymond shall be entitled to receive prompt
reimbursement for all reasonable business-related expenses incurred by Raymond in the performance
of Raymond’s duties in accordance with the Company’s policies, practices and procedures.



               (vii) Pro-ration. Any payments or benefits payable to Raymond hereunder in respect of
any calendar year during which Raymond is retained by the Company for less than the entire year,
unless otherwise provided in the applicable plan or arrangement, shall be pro-rated in accordance
with the number of days in such calendar year during which Raymond is so retained.



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     4. Termination.



          (a) Death. Raymond’s retention hereunder shall terminate automatically upon Raymond’s
death during the Term.




          (b) Disability. If the Disability of Raymond has occurred during the Term, the
Company may give to Raymond a written Notice of Termination (as defined in Section 6(a)) in
accordance with Section 6(a) of its intention to terminate Raymond’s retention hereunder.
In such event, Raymond’ s retention by the Company shall terminate effective on the 30th day after
receipt of such notice by Raymond (the “Disability Effective Date”) provided that, within
30 days after receipt of the Notice of Termination, Raymond shall not have returned to perform,
with or without reasonable accommodations, the essential functions of Raymond’s position. During
any period of Raymond’s Disability, the Company may assign Raymond’s duties to any other director
on an interim basis and any such action shall not be deemed “Good Reason” for Raymond to terminate
this Agreement pursuant to Section 4(d)(i) so long as Raymond continues to receive the
compensation and benefits under Section 3 during such period.




          (c) Termination by Company. Subject to Section 6(d), the Company may
terminate Raymond’s retention at any time during the Term for Cause or without Cause.




          (d) Resignation by Raymond. At Raymond’s option, Raymond may terminate Raymond’s
retention hereunder (i) subject to Section 6(c), for Good Reason or (ii) without Good
Reason.




     5. Compensation Upon Termination. Raymond shall be entitled to the following
compensation from the Company upon the termination of Raymond’s retention by the Company during the
Term. The compensation provided for in this Section 5 shall be in lieu of any other
severance pay to which Raymond might otherwise be entitled (whether contractual or under a
severance plan, the WARN Act, any other applicable law, or otherwise) and shall be conditioned on
the execution and delivery of a Release (as defined in Section 6(f)) signed by Raymond or
Raymond’s legal representative pursuant to Section 6(f). The timing of payments pursuant
to this Section 5 shall also be subject to the requirements of Section 6(g) and
Section 409A of the Code:



          (a) Death or Disability. If Raymond’s retention by the Company is terminated by
reason of Raymond’s death or Disability, the Company shall pay to Raymond or Raymond’s legal
representatives:




               (i) within 30 days after Raymond’s Date of Termination as defined in Section 6(b), a
lump sum in cash equal to the sum of Raymond’s Annual Base Salary through the Date of Termination
to the extent not previously paid and any compensation previously deferred by Raymond (together
with any accrued interest or earnings thereon) (the “Accrued Obligations”);



               (ii) the amount of any Annual Bonus to which Raymond was entitled for the calendar year ending
prior to the Date of Termination to the extent not previously paid and the amount of any Pro Rata
Bonus, each of which amounts shall be paid no later than the later of 30 days after the Date of
Termination or 10 business days after the date on which the



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Company has available to it the information reasonably required to determine the amount to be
paid;




               (iii) any amounts arising from Raymond’s participation in, or benefits under, any Investment
Plan (the “Accrued Investments”), which amounts shall be paid in accordance with the terms
and conditions of such Investment Plan; and



               (iv) any amounts to which Raymond or Raymond’s spouse, beneficiaries or estate are entitled
from Raymond’s participation in, or benefits under, any Welfare Plan (“Accrued Welfare
Benefits”), which amounts shall be paid in accordance with the terms and conditions of such
Welfare Plan.



     Except as described in this Section 5(a), in the event of Raymond’s termination by
reason of Raymond’s death or Disability, Raymond and Raymond’s legal representatives, as
applicable, shall forfeit all rights to any other compensation.



          (b) For Cause; Resignation by Raymond Without Good Reason; Non-Renewal Election by
Raymond. If the Company shall terminate the retention of Raymond hereunder for Cause, or if
Raymond resigns without Good Reason, or if Raymond’s retention by the Company is terminated due to
a Non-Renewal election by Raymond, the Company shall have no further obligations to Raymond other
than the obligation for payment of:




               (i) the Accrued Obligations, which shall be payable within 30 days after Raymond’s Date of
Termination;



               (ii) the amount of any Annual Bonus to which Raymond was entitled for the calendar year ending
prior to the Date of Termination to the extent not previously paid, which amount shall be paid no
later than the later of 30 days after the Date of Termination;



               (iii) the Accrued Investments, which amounts shall be paid in accordance with the terms and
conditions of the Investment Plans; and



               (iv) the Accrued Welfare Benefits, which amounts shall be paid in accordance with the terms
and conditions of the Welfare Plans.



     Except as described in this Section 5(b), in the event of Raymond’s termination by the
Company for Cause or by Raymond without Good Reason or due to a Non-Renewal election by Raymond,
Raymond shall forfeit all rights to any other compensation.



          (c) Without Cause; Resignation by Raymond for Good Reason: Non-Renewal Election by the
Company. If the Company terminates the retention of Raymond hereunder without Cause (other
than by reason of Raymond’s death or Disability or a Non-Renewal by Raymond) or Raymond resigns for
Good Reason or the retention of Raymond hereunder is terminated due to a Non- Renewal election by
the Company, then the Company shall pay or provide Raymond:




               (i) within 30 days after Raymond’s Date of Termination, a lump sum in cash equal to the
aggregate of the Accrued Obligations;



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               (ii) the amount of any Annual Bonus to which Raymond was entitled for the calendar year ending
prior to the Date of Termination to the extent not previously paid and any Pro Rata Bonus, each of
which amounts shall be paid no later than the later of 30 days after the Date of Termination or 10
business days after the date on which the Company has available to it the information reasonably
required to determine the amount to be paid;



               (iii) the Accrued Investments, which amounts shall be paid in accordance with the terms and
conditions of the Investment Plans;



               (iv) the Accrued Welfare Benefits, which amounts shall be paid in accordance with the terms
and conditions of the Welfare Plans;



               (v) a lump-sum payment within 30 days of the Date of Termination equal to the greater of (A)
the undiscounted amount of Annual Base Salary Raymond would have received for the rest of the Term
based upon the highest Annual Base Salary to which Raymond was entitled during the 24-month period
ending on the Date of Termination or (B) two years of the highest Annual Base Salary to which
Raymond was entitled during the 24-month period ending on the Date of Termination; and



               (vi) if Raymond is entitled on the Date of Termination to coverage under the medical,
prescription, and dental portions of the Welfare Plans, continuation at the Company’s sole cost and
expense of such coverage for Raymond and Raymond’s dependents for a period ending on the later to
occur of (A) the second anniversary of the Date of Termination or (B) the end of the full Term.
Notwithstanding any provision of the foregoing to the contrary, the continued coverage provided
pursuant to this Section 5(c)(vi) will count towards the depletion of any continued health
care coverage rights that Raymond and Raymond’s dependents may have pursuant to COBRA, and
Raymond’s or Raymond’s dependents’ rights to continued health care coverage pursuant to this
Section 5(c)(vi) shall terminate at the time Raymond or Raymond’s dependents become
covered, as described in COBRA, under another group health plan that does not limit coverage with
respect to any preexisting conditions of Raymond or Raymond’s dependents, and shall also terminate
as of the date the Company ceases to provide coverage to its senior executives generally under any
such Welfare Plan.



     The parties hereto acknowledge that in the event Raymond’s retention is terminated in
connection with a Change in Control, the consideration payable to Raymond under Section
5(c)(v) hereof is related to the additional efforts and services that will have been required
of the Raymond in connection with such Change in Control transaction and to Raymond’s obligations
under Sections 7, 8 and 9 of this Agreement.



     Except as described in this Section 5(c), in the event of Raymond’s termination by the
Company without Cause or by Raymond for Good Reason or due to a Non-Renewal election by the
Company, Raymond shall forfeit all rights to any other compensation.



     6. Other Provisions Relating to Termination.



          (a) Notice of Termination. Any termination by the Company for Cause or without Cause
or by reason of Raymond’s Disability, or by Raymond’s resignation for Good Reason or without Good
Reason, shall be communicated by Notice of Termination to the other



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party hereto given in accordance with Section 10(b). For purposes of this Agreement,
a “Notice of Termination” means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon and (ii) to the extent applicable, sets forth
in reasonable detail the facts and circumstances claimed to provide a basis for termination of
Raymond under the provision so indicated. The failure by the Company or Raymond to set forth in
the Notice of Termination any fact or circumstance which contributes to a showing of Cause or Good
Reason shall not waive any right of the Company or Raymond hereunder or preclude the Company or
Raymond from asserting such fact or circumstance in enforcing the Company’s or Raymond’s rights
hereunder.




          (b) Date of Termination. “Date of Termination” means (i) if Raymond is
terminated by reason of Raymond’s death, the date of Raymond’s death; (ii) if Raymond is terminated
by reason of Raymond’s Disability, the Disability Effective Date (provided that Raymond shall not
have returned to perform, with or without reasonable accommodation, the essential functions of
Raymond’s position during the 30-day period provided for in Section 4(b)); (iii) if Raymond
is terminated by the Company without Cause or by Raymond for Good Reason or without Good Reason,
then, subject to Section 6(c), the date specified in the Notice of Termination (which date
shall be a date between the date that the Notice of Termination is given and 30 days thereafter
(inclusive)); (iv) if Raymond is terminated by the Company for Cause then, subject to Section
6(d), the date on which the Notice of Termination is given; and (v) if Raymond is terminated
due to a Non-Renewal election by Raymond or the Company, the date on which the Term expires.




          (c) Good Reason. Upon Raymond’s learning of the occurrence of any event described in
the definition of Good Reason in Section 1(j), Raymond may resign his responsibilities
hereunder for Good Reason within 60 days thereafter by giving a Notice of Termination to the
Company to that effect and describing in reasonable detail the facts or circumstances giving rise
to Raymond’s right to terminate his responsibilities for Good Reason. Notwithstanding the
foregoing, the right of Raymond to terminate for Good Reason under Section 4(d)(i) shall
not limit the Company’s right to terminate Raymond for Cause under Section 4(c) if Cause is
determined to exist prior to the time Good Reason is determined to exist.




          (d) Cause. Upon the Company learning of the occurrence of any event described in
Section 1(c), the Company may terminate Raymond’s retention hereunder for Cause within 60
days thereafter by giving Raymond a Notice of Termination to that effect and describing in
reasonable detail the facts or circumstances giving rise to the Company’s right to terminate for
Cause. Notwithstanding the foregoing, the right of the Company to terminate Raymond’s retention
for Cause under Section 4(c) shall not limit Raymond’s right to resign for Good Reason
under Section 4(d)(i) if Good Reason is determined to exist prior to the time Cause is
determined to exist.




          (e) Full Settlement; Mitigation. In no event shall Raymond be obligated to seek other
similar positions or take any other action by way of mitigation of the amounts payable to Raymond
under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not
Raymond obtains another similar position. The Company shall not be liable to Raymond for any
damages for breach of this Agreement in addition to the amounts payable under Section 5
arising out of the termination of Raymond hereunder prior to the end of



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the Term. The Company shall be entitled to seek damages from Raymond for any breach of
Section 8 by Raymond.




          (f) Release and Other Agreements. Notwithstanding any other provision in this
Agreement to the contrary, in consideration for receiving the severance benefits described in
Sections 5(c)(v) and 5(c)(vi), Raymond hereby agrees to execute (and not revoke) a
Release and Separation Agreement and a Waiver and Release within 60 days of the Date of Termination
in substantially the forms attached hereto as Exhibit A (the “Release”). If
Raymond fails to properly execute and deliver the Release (or revokes the Release), Raymond agrees
that Raymond shall not be entitled to receive such severance benefits.




          (g) 409A Compliance. To the extent required by section 409A of the Code, if on
Raymond’s Date of Termination he is a “specified executive” within the meaning of section 409A of
the Code, any amounts that are payable to Raymond by reason of his termination pursuant to
Section 5 and that are not excluded from application of Section 409A of the Code by reason
of the “short term deferral” exception to Section 409A of the Code will be delayed for a period of
six months following the Date of Termination. Any payments that would have been paid to Raymond
pursuant during such six-month period and that are delayed pursuant to this Section 6(g)
shall be paid to him in the form of a lump sum payment at the end of the six-month period.




     7. Disclosure of, Access to and Entrustment of Confidential Information, Business
Opportunities and Business Goodwill. During the Term, the Company shall disclose to Raymond,
or place Raymond in a position to have access to or develop, Confidential Information (as defined
in Section 8(a)(i)), and/or shall entrust Raymond with business opportunities of the
Company, and/or shall place Raymond in a position to develop business goodwill on behalf of the
Company. There is a need and desire on the part of the Company and Raymond to specify the parties’
rights and obligations with respect to the ownership and protection of such Confidential
Information, business opportunities and goodwill. Accordingly, as a material inducement to the
Company to enter into this Agreement, in consideration for the compensation and other benefits
payable hereunder to Raymond, to protect the Company’s Confidential Information that has been and
will be in the future disclosed or entrusted to Raymond (the disclosure of which by Raymond in
violation of this Agreement would adversely affect the business goodwill of the Company), the
business goodwill of the Company that has been and will in the future be developed in Raymond and
the business opportunities that have been and will in the future be disclosed or entrusted to
Raymond by the Company; and for other good and valuable consideration, Raymond agrees to comply
with, and be bound by, Section 8 and Section 9. As used in this Section 7
and in Sections 8 and 9, “Company” shall include the Company and any of its
Subsidiaries.



     8. Confidential Information; Ownership of Property.



          (a) Obligations to Maintain Confidentiality.




               (i) Raymond acknowledges that the Company has trade, business and financial secrets and other
confidential and proprietary information regarding the Company and its business, in whatever form,
tangible or intangible (collectively, the “Confidential 



12









 




Information”), and that, during the course of Raymond’s retention by the Company,
Raymond has received, shall receive or be placed in a position to have access to or develop
Confidential Information. Raymond further acknowledges and agrees that Raymond’s use of
Confidential Information in the conduct of business on behalf of a competitor of the Company would
constitute unfair competition with the Company and would adversely affect the business goodwill of
the Company. Confidential Information includes sales materials, technical information, processes
and compilations of information, records, specifications and information concerning customers,
prospective customers, customer and prospective customer lists, and information regarding methods
of doing business, As defined herein, Confidential Information shall not include information that
is or was (i) obtained by Raymond from a source other than the Company or its Affiliates, which
source is not under a duty of non-disclosure in regard to such information or (ii) becomes
generally available to the public other than through disclosure by Raymond in violation of the
provisions of this Agreement.




               (ii) Raymond is aware of those policies implemented by the Company to keep its Confidential
Information secret, including those policies limiting the disclosure of information on a
need-to-know basis and requiring the keeping of information in secure areas. Raymond acknowledges
that the Confidential Information has been or will be developed or acquired by the Company through
the expenditure of substantial time, effort and money and provides or will provide the Company with
an advantage over competitors who do not know or use such Confidential Information.



               (iii) During and following Raymond’s retention by the Company, Raymond shall hold in
confidence and not directly or indirectly disclose, use (for Raymond’s commercial advantage or
otherwise), copy, make lists of, or make available to others any Confidential Information except in
Raymond’s good faith performance of Raymond’s duties to the Company or to the extent authorized in
writing by the Board or required by law or compelled by legal process. Raymond agrees to use
reasonable efforts to give the Company notice of any and all attempts to compel disclosure of any
Confidential Information. Raymond further agrees not to use any Confidential Information for the
benefit of any person or entity other than the Company.



               (iv) Raymond agrees that all Confidential Information and other files, documents, materials,
records, notebooks, customer lists, business proposals, contracts, agreements and other
repositories containing information concerning the Company or the business of the Company, in
whatever form, tangible or intangible (including all copies thereof), that Raymond shall prepare,
or use, or be provided with as a result of Raymond’s retention by the Company, shall be and remain
the sole property of the Company. Upon termination of Raymond’s retention hereunder, Raymond
agrees that all Confidential Information and other files, documents, materials, records, notebooks,
customer lists, business proposals, contracts, agreements and other repositories containing
information concerning the Company or the business of the Company (including all copies thereof) in
Raymond’s possession, custody or control, whether prepared by Raymond or others, shall remain with
or be returned to the Company promptly after the Date of Termination. The materials required to be
returned pursuant to this Section 8(a)(iv) shall not include personal correspondence or
other personal property of Raymond that does not relate to the Company or the business of the
Company.



13









 





          (b) Ownership of Work Product. Raymond acknowledges that all discoveries, concepts,
ideas, inventions, innovations, improvements, developments, methods, processes, programs, designs,
analyses, drawings, reports, patent applications, copyrightable work and all registrations or
applications related thereto, all other proprietary information and all similar or related
information (whether or not patentable) that relate to the Company’s or its Affiliates’ actual or
anticipated business, research and development, or existing or future products or services and that
are conceived, developed, contributed to, made, or reduced to practice by Raymond (either solely or
jointly with others) while retained by the Company (including any of the foregoing that constitutes
any proprietary information or records) (“Work Product”) belong to the Company or its
Affiliates, as applicable, and Raymond hereby assigns, and agrees to assign, all of the above Work
Product to the Company or its Affiliates, as applicable.




     9. Non-Solicitation and Related Matters.



          (a) Raymond agrees that during the Term and for a period commencing upon the termination of
Raymond’s retention hereunder and ending upon the first anniversary thereof, unless otherwise
extended pursuant to the terms of this Section 9, Raymond will not solicit, directly or
indirectly, in the capacity of employee, consultant, or in any other capacity whatsoever, one or
more of the employees, directors, officer or other persons who, at the time of solicitation, or in
the 180-day period prior thereto, are working full-time or part time for the Company and will not
endeavor, directly or indirectly in any manner whatsoever, to encourage any of such person to leave
his or her job with the Company and will not endeavor, directly or indirectly in any manner
whatsoever, to incite or induce any client or customer of the Company to terminate, in whole or in
part, its business relations with the Company except to the extent the solicitation is made through
a public advertisement in a newspaper, trade journal or similar public medium. Notwithstanding the
foregoing provisions of this Section 9(a), however, Raymond shall have no further
obligations under this Section 9(a) in the event of a termination of Raymond’s retention by
the Company without Cause or in the event of Raymond’s resignation for Good Reason or if Raymond’s
retention is terminated as a result of the Company’s Non-Renewal election or if there is Change in
Control.




          (b) The representations and covenants contained in this Section 9 on the part of
Raymond will be construed as ancillary to and independent of any other provision of this Agreement,
and the existence of any claim or cause of action of Raymond against the Company or any officer,
director, or shareholder of the Company, whether predicated on this Agreement or otherwise, shall
not constitute a defense to the enforcement by the Company of the covenants of Raymond contained in
this Section 9. In addition, the provisions of this Section 9 shall continue to be
binding upon Raymond in accordance with their terms, notwithstanding the termination of Raymond
hereunder for any reason.




          (c) If Raymond violates any covenant contained in this Section 9 and the Company
brings legal action for injunctive or other relief, the Company shall not, as a result of the time
involved in obtaining the relief, be deprived of the benefit of the full period of any such
covenant. Accordingly, the covenant of Raymond contained in the Section 9 shall be deemed
to have the duration as specified above, which period shall commence upon the later of (i) the
termination of Raymond’s retention hereunder and (ii) the date of entry by a court of competent
jurisdiction of a final judgment enforcing the covenant of Raymond in this Section 9.




14









 








     10. Successors; Binding Agreement.



          (a) This Agreement is personal to Raymond and shall not be assignable by Raymond otherwise
than by will or the by laws of descent and distribution. This Agreement shall inure to the benefit
of and be enforceable by Raymond’s personal and legal representatives, executors, administrators,
heirs, distributes, devisees and legatees.




          (b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.




          (c) The Company shall require any successor (whether direct or indirect, by purchase, merger,
consolidation, sale of assets or otherwise) to all or substantially all of the business and/or
assets of the Company, by a written agreement in form and substance reasonably satisfactory to
Raymond, to assume expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle Raymond to compensation from the Company in
the same amount and on the same terms as Raymond would be entitled to pursuant to Section 5
if Raymond terminated for Good Reason after the occurrence of a Change in Control, except that for
purposes of implementing the foregoing, the date on which any such succession becomes effective
shall be deemed the Date of Termination. As used in this Agreement and after any such succession,
“Company” shall mean the Company as hereinbefore defined and any successor and/or assigns as
aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.




     11. Miscellaneous.



          (a) Construction. This Agreement shall be deemed drafted equally by both the parties.
Its language shall be construed as a whole and according to its fair meaning. Any presumption or
principle that the language is to be construed against any party shall not apply. The headings in
this Agreement are only for convenience and are not intended to affect construction or
interpretation. Any references to paragraphs, subparagraphs, sections, subsections or clauses are
to those parts of this Agreement, unless the context clearly indicates to the contrary. Also,
unless the context clearly indicates to the contrary, (i) the plural includes the singular and the
singular includes the plural; (ii) “and” and “of’ are each used both conjunctively and
disjunctively; (iii) “any,” “all,” “each,” or “every” means “any and all”, and “each and every”;
(iv) “includes” and “including” are each “without limitation”; (v) “herein,” “hereof” “hereunder”
and other similar compounds of the word “here” refer to the entire Agreement and not to any
particular paragraph, subparagraph, section or subsection; and (vi) all pronouns and any variations
thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural as the
identity of the entities or persons referred to may require.




          (b) Notices. All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other party or by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:





15









 








	 	 	 
	If to Employee	 	If to the Company
	Robert J. Raymond

	 	Crusader Energy Group Inc.
	 
	 	 
	200 Crescent Court, Suite 1060

	 	4747 Gaillardia Parkway
	 
	 	 
	Dallas, TX 75201

	 	Oklahoma City, OK 73142





or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.




          (c) Severability. If any provision of this Agreement is held to be illegal, invalid
or unenforceable under present or future laws effective during the term of this Agreement, such
provision shall be fully severable; this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a portion of this Agreement; and
the remaining provisions of this Agreement shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance from this
Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision there shall be
added automatically as part of this Agreement a provision as similar in terms to such illegal,
invalid or unenforceable provision as may be possible and be legal, valid and enforceable.




          (d) Withholding. The Company may withhold from any amounts payable under this
Agreement such Federal, state or local taxes as shall be required to be withheld pursuant to any
applicable law or regulation.




          (e) No Waiver. Except as expressly set forth in this Agreement, no waiver by either
party at any time of any breach by the other party of, or compliance with, any condition or
provision of this Agreement to be performed by the other party shall be deemed a waiver of similar
or dissimilar provisions or conditions at any time.




          (f) Equitable and Other Relief. Raymond acknowledges that money damages would be both
incalculable and an insufficient remedy for a breach of Section 8 by Raymond and that any
such breach would cause the Company irreparable harm. Accordingly, the Company, in addition to any
other remedies at law or in equity it may have, shall be entitled, without the requirement of
posting of bond or other security, to equitable relief, including injunctive relief and specific
performance, in connection with a breach of Section 8 by Raymond. If the Company files a
pleading with a court seeking immediate injunctive relief and this pleading is challenged by
Raymond and injunctive relief sought is not awarded, the Company shall pay all of Raymond’s costs
and attorneys’ fees. The parties consent to the exclusive jurisdiction of competent state courts
or federal courts in the State of Nevada for all litigation which may be brought with respect to
the terms of; and the transactions and relationships contemplated by, this Agreement. The parties
further consent to the non-exclusive jurisdiction of any state court located within a district
which encompasses assets of a party against which a judgment has been rendered for the enforcement
of such judgment or award against the assets of such party.




16









 








          (g) Entire Agreement. The provisions of this Agreement constitute the entire and
complete understanding and agreement between the parties with respect to the subject matter hereof,
and supersede all prior and contemporaneous oral and written agreements, representations and
understandings of the parties, which are hereby terminated. Raymond and the Company acknowledge
and represent that there are no other promises, terms, conditions or representations (or written)
regarding any matter relevant hereto.




          (h) Attorney Fees. The prevailing party in any dispute or controversy under or in
connection with this Agreement shall be entitled to reimbursement from the non-prevailing party for
all costs and reasonable legal fees incurred by such prevailing party.




          (i) Survival. Sections 1 and 4 through 11 of this Agreement
shall survive the termination of this Agreement.




          (j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEVADA WITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS OF NEVADA
OR ANY OTHER JURISDICTION, AND, WHERE APPLICABLE, THE LAWS OF THE UNITED STATES.




          (k) Amendments. This Agreement may not be amended or modified at any time except by a
written instrument approved by the Board and executed by the Company and Raymond.




          (l) Raymond Acknowledgement. Raymond acknowledges that Raymond has read and
understands this Agreement, is fully aware of its legal effect, has not acted in reliance upon any
representatives or promises made by the Company other than those contained in writing herein, and
has entered into this Agreement freely based on Raymond’s own judgment.




          (m) Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be an original, but all of which together shall constitute one and the same
instrument. Any counterpart of this Agreement that has attached to it separate signature pages
which together contain the signature of all parties hereto shall for all purposes be deemed a fully
executed original. Facsimile signatures shall constitute original signatures.




[SIGNATURE PAGE FOLLOWS]




17









 





     IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the date and year
first above written.



	 	 	 	 	 
	 	COMPANY:



CRUSADER ENERGY GROUP INC.

 	 
	 	By:  	/s/ David D. Le Norman
 	 
	 	 	David D. Le Norman, President 	 
	 	 	 	 
	 	                 /s/ Robert J. Raymond
 	 
	 	Robert J. Raymond 	 
	 	 	 
	 



SIGNATURE PAGE TO SERVICES AGREEMENT





 









 








EXHIBIT A




RELEASE AND SEPARATION AGREEMENT





     THIS RELEASE AND SEPARATION AGREEMENT (the “Release Agreement”) made and entered into
effective                     , by and between Crusader Energy Group Inc., a                      corporation (the
“Company”) and Robert J. Raymond (“Raymond”).



W I T N E S S E T H:




     WHEREAS, Raymond is not and has not been an employee of the Company; and



     WHEREAS, Raymond has provided services to the Company pursuant to the terms of a Services
Agreement signed and dated                      (the “Services Agreement”); and



     WHEREAS, the Company has decided to terminate the retention of Raymond without Cause (other
than by reason of Raymond’s death or Disability or a Non-Renewal by Raymond) or Raymond has
decided to resign for Good Reason or Raymond’s retention is terminated due to Non-Renewal election
by the Company;



     WHEREAS, as provided in Sections 5 and 6(f) of the Services Agreement, in exchange for a
release, the parties have agreed that the Company will provide Raymond with the benefits described
in Sections 5(c)(v) and 5(c)(vi) of the Services Agreement; and



     WHEREAS, in consideration of the mutual promises contained herein, the parties hereto are
willing to enter into this agreement upon the terms and conditions herein set forth.



     NOW, THEREFORE, in consideration of the premises, the terms and provisions set forth herein,
the mutual benefits to be gained by the performance thereof and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:



     1. Separation and Resignation from Officer Positions.



     Effective as of the close of business on                                         ,                     , Raymond will no longer provide
his services to the Company (the “Separation Date”). At that time, Raymond agrees to resign any
and all director, officer, or other positions he holds with the Company or any of its affiliates
and/or subsidiaries.



     2. Special Compensation for Waiver and Release.



     Waiver and Release. Raymond shall have up to twenty-one (21) calendar days to
consider whether to sign and return this Release Agreement to the Company by first class mail, by
hand delivery or by scanned document sent via facsimile or electronic mail. In consideration for
Raymond’s execution of and compliance with this agreement, including but not limited to the
execution of the Waiver and Release attached hereto as Attachment “I”, the Company shall



1









 





Robert J. Raymond

Separation Agreement



provide Raymond benefits as set forth in Sections 5(c)(v) and 5(c)(vi) of the Services
Agreement. The value of such benefits is in excess of what Raymond is otherwise entitled to. This
consideration is provided subject to the binding execution by Raymond (without revocation) of the
Waiver and Release. No payment shall be made or other benefit described hereunder provided until
the expiration of the seven-day revocation period described in the Waiver and Release following
Raymond’s signing of the Waiver and Release (the “Effective Waiver Date”).




     3. Restrictive Covenants. As a material inducement to the Company to enter into this
Release Agreement, Raymond agrees that the covenants set forth in Sections 7 through 9 of the
Services Agreement remain in full force and effect in accordance with their terms.



     4. Amendment of Agreement. This Release Agreement may not be modified or amended
except by an instrument in writing signed by the parties hereto.



     5. Waiver. No term or condition of this Release Agreement shall be deemed to have
been waived, nor shall there be an estoppel against the enforcement of any provision of this
agreement, except by written instrument of the party charged with such waiver or estoppel.



     6. Notices. All notices or communications hereunder shall be made in accordance with
Section 11 (b) of the Services Agreement.



     7. Severability. If any provision of this Release Agreement is held to be invalid,
illegal or unenforceable, in whole or part, such invalidity will not affect any otherwise valid
provision, and all other valid provisions will remain in full force and effect.



     8. Counterparts. This Release Agreement may be executed in two or more counterparts,
each of which will be deemed an original, and all of which together will constitute one document.



     9. Titles. The titles and headings preceding the text of the sections and subsections
of this Release Agreement have been inserted solely for convenience of reference and do not
constitute a part of this agreement or affect its meaning, interpretation or effect.



     10. Drafting. The agreements between Raymond and Company contained herein shall not
be construed in favor of or against the other party but shall be construed as if all parties
prepared this agreement.



     11. Release Not To Be Used As Evidence. This Release Agreement shall not be
admissible as evidence in any proceeding except one in which a party to this Release Agreement
seeks to enforce this Release Agreement or alleges this Release Agreement has been breached, or one
in which a court or administrative agency of competent jurisdiction orders Raymond or the Company
to produce this Release Agreement.



     12. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEVADA,



2









 





Robert J. Raymond

Separation Agreement



UNITED STATES OF AMERICA, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF.




     13. Entire Agreement. The Services Agreement and the Release Agreement, together with
Attachment I hereto constitute the entire agreement of the parties with respect to the subject
matter hereof.



     14. 409A Compliance. The parties acknowledge that all payments and benefits provided
under this Release Agreement are intended to meet the requirements and restrictions of the
nonqualified deferred compensation rules contained in Section 409A of the Internal Revenue Code of
1986, as amended (to the extent applicable thereto).



     IN WITNESS WHEREOF, the parties have executed this Agreement in multiple counterparts, all of
which shall constitute one agreement, effective as of the date and year first above written.



	 	 	 	 	 
	 	CRUSADER ENERGY GROUP INC.

 	 
	 	By:  	
 	 
	 	 	David D. Le Norman, President	 
	 	 	 	 
	 	ROBERT J. RAYMOND

 	 
	 	By:  	
 	 
	 	 	Robert J. Raymond 	 
	 	 	 	 
	 




3









 





Attachment “I”




CRUSADER ENERGY GROUP INC.

Waiver And Release




     Crusader Energy Group Inc. has offered to pay me certain severance benefits (the “Benefits”)
under the Release and Separation Agreement, dated as of                      (the “Release Agreement”),
which Release Agreement includes benefits to which I am not otherwise entitled. These Benefits
were offered to me in exchange for my agreement, among other things, to waive all of my claims
against and release Crusader Energy Group Inc. and its predecessors, successors and assigns
(collectively referred to as the “Company”), all of the affiliates (including parents and
subsidiaries) of the Company (collectively referred to as the “Affiliates”) and the Company’s and
Affiliates’ directors and officers, employees and agents, insurers, employee benefit plans and the
fiduciaries and agents of said plans (collectively, with the Company and Affiliates, referred to as
the “Corporate Group”) from any and all claims, demands, actions, liabilities and damages arising
out of or relating in any way to my service to, or termination of such service, the Company or the
Affiliates; provided, however, that this Waiver and Release shall not apply to any claim or cause
of action to enforce or interpret any provision contained in the Release Agreement that may arise
after the date this Waiver and Release is executed. I have read this Waiver and Release and the
Release Agreement. I choose to accept this offer.



     I understand that signing this Waiver and Release is an important legal act. I acknowledge
that the Company has advised me in writing to consult an attorney before signing this Waiver and
Release. I understand that, in order to be eligible for Benefits, I must sign and return to
Crusader Energy Group Inc. this Waiver and Release before 5 p.m. on                     . I
acknowledge that I am not and have never been an employee of the Company. I also acknowledge that
I have been given sufficient time to consider whether to sign the Release Agreement and whether to
execute this Waiver and Release.



     In exchange for the payment to me of Benefits, which are in addition to any remuneration or
benefits to which I am already entitled, I, among other things, (1) agree not to sue in any local,
state and/or federal court regarding or relating in any way to my service to, or termination of
service, to the Company or the Affiliates, and (2) knowingly and voluntarily waive all claims and
release the Corporate Group from any and all claims, demands, actions, liabilities, and damages,
whether known or unknown, arising out of or relating in any way to my employment with or separation
from the Company or the Affiliates.1 This Waiver and Release includes, but is not
limited to, claims and causes of action under: Title VII of the Civil Rights Act of 1964, as





 




			
	1	 	Although I was never an employee of the Company,
nothing in this Waiver and Release or the Release Agreement should be construed
as a waiver of my rights vested under the terms of employee benefit plans
sponsored by the Company or the Affiliates or with respect to such rights or
claims as may arise after the date this Waiver and Release is executed or to
amounts owed to me pursuant to the terms of my Services Agreement with the
Company. Additionally, I am not waiving any rights that I may have under the
Family and Medical Leave Act of 1993 or the Fair Labor Standards Act.
Furthermore, although I waive all rights to recovery of any compensation or
benefits that I might be entitled to as a result of filing charges or claims
with the Equal Employment Opportunity Commission and the National Labor
Relations Board, I am not giving up any right that I may have to file charges
or claims with these governmental agencies. Finally, I am not waiving any
rights that cannot by law be released by private agreement.




1









 









amended (“Title VII”); the Age Discrimination in Employment Act of 1967, as amended, including
the Older Workers Benefit Protection Act of 1990 (“ADEA”); the Civil Rights Act of 1866, as
amended; the Civil Rights Act of 1991; the Americans with Disabilities Act of 1990 (“ADA”); the
Energy Reorganization Act, as amended, 42 U.S.C. ss 5851; the Workers Adjustment and Retraining
Notification Act of 1988; the Pregnancy Discrimination Act of 1978; the Employee Retirement Income
Security Act of 1974, as amended; the Occupational Safety and Health Act; claims in connection
with workers’ compensation or “whistle blower” statutes; and/or contract, tort, defamation,
slander, wrongful termination or any other state or federal regulatory, statutory or common law.
Further, I expressly represent that no promise or agreement which is not expressed in the Release
Agreement has been made to me in executing this Waiver and Release, and that I am relying on my own
judgment in executing this Waiver and Release, and that I am not relying on any statement or
representation of the Company, any of the Affiliates or any other member of the Corporate Group or
any of their agents. I agree that this Waiver and Release is valid, fair, adequate and reasonable,
is with my full knowledge and consent, was not procured through fraud, duress or mistake and has
not had the effect of misleading, misinforming or failing to inform me.




     I acknowledge that payment of Benefits to me by the Company is not an admission by the Company
or any other member of the Corporate Group that they engaged in any wrongful or unlawful act or
that the Company or any member of the Corporate Group violated any federal or state law or
regulation.



     Should any of the provisions set forth in this Waiver and Release be determined to be invalid
by a court, agency or other tribunal of competent jurisdiction, it is agreed that such
determination shall not affect the enforceability of other provisions of this Waiver and Release.
I acknowledge that this Waiver and Release and the Release Agreement set forth the entire
understanding and agreement between me and the Company or any other member of the Corporate Group
concerning the subject matter of this Waiver and Release and supersede any prior or contemporaneous
oral and/or written agreements or representations, if any, between me and the Company or any other
member of the Corporate Group. I understand that for a period of 7 calendar days following the
date that I sign this Waiver and Release, I may revoke my acceptance of the offer, provided that my
written statement of revocation is received on or before that seventh day by Crusader Energy Group
Inc., in which case the Waiver and Release will not become effective. In the event I revoke my
acceptance of this offer, the Company shall have no obligation to provide me Benefits. I
understand that failure to revoke my acceptance of the offer within 7 calendar days from the date I
sign this Waiver and Release will result in this Waiver and Release being permanent and
irrevocable.



2









 





     I acknowledge that I have read this Waiver and Release, have had an opportunity to ask
questions and have it explained to me and that I understand that this Waiver and Release will have
the effect of knowingly and voluntarily waiving any action I might pursue, including breach of
contract, personal injury, retaliation, discrimination on the basis of race, age, sex, national
origin, or disability and any other claims arising prior to the date of this Waiver and Release.
By execution of this document, I do not waive or release or otherwise relinquish any legal rights I
may have which are attributable to or arise out of acts, omissions, or events of the Company or any
other member of the Corporate Group which occur after the date of the execution of this Waiver and
Release.



	 	 	 
	 
	 	 
	 

Robert J. Raymond

	 	 
	 
	 	 
	 
	 	 
	 

Raymond’s Signature Date

	 	 







3