<PAGE>

                                                                    Exhibit 10.3


                          CHANGE OF CONTROL AGREEMENT

     This change of control agreement ("Agreement") is entered into effective as
of [_______][___], [____], by and between Canaan Energy Corporation ("Canaan")
and [NAME] ("Executive").

     WHEREAS, Canaan desires to retain certain key employee personnel and,
accordingly, the Board of Directors of Canaan has approved Canaan entering into
a change of control agreement with Executive in order to encourage Executive's
continued service to Canaan.

     NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, Canaan and Executive agree as follows:

1.   DEFINITIONS.
     -----------

     (a)  "Change in Duties" shall mean the occurrence, within two (2) years
          after the date upon which a Change of Control occurs, of any one or
          more of the following:

          (i)   a reduction in Executive's annual salary from the level in
                effect immediately prior to the Change of Control;

          (ii)  failure of Canaan or its successor to provide Executive with an
                annual bonus, incentive compensation or other employee benefits
                (including but not limited to medical, dental, life insurance,
                accidental, death and long-term disability plans) that are
                materially consistent with such annual bonuses, incentive
                compensation or other employee benefits provided by Canaan or
                its successor to executives with comparable duties;

          (iii) a significant adverse alteration in the nature or status of
                Executive's duties, title, responsibilities, or the conditions
                of Executive's employment from those in effect immediately prior
                to such Change in Control; or

          (iv)  a change in the location of Executive's principal place of
                employment by Canaan or its successor by more than fifty (50)
                miles from the location where Executive was principally employed
                immediately prior to the date on which a Change of Control
                occurs.

     (b)  "Change of Control" shall mean the occurrence after the effective date
          of this Agreement of:

          (i)   an acquisition (other than directly from Canaan) of any voting
                securities of Canaan (the "Voting Securities") by any "Person"
                (as the term person is used for purposes of Section 13(d) or
                14(d) of the Securities Exchange Act of 1934 (the "Exchange
                Act")) immediately after which such Person has "Beneficial
                Ownership" (within the meaning of Rule 13d-3 promulgated under
                the
<PAGE>

                Exchange Act) of fifty percent (50%) or more of the combined
                voting power of Canaan's then outstanding Voting Securities;

          (ii)  the individuals who, as of the effective date of this Agreement,
                are members of the Board of Directors of Canaan (the "Incumbent
                Board"), cease for any reason to constitute at least two-thirds
                of the members of the Board of Directors of Canaan (the
                "Board"); provided, however, that if the election, or nomination
                for election by Canaan's common stockholders, of any new
                director was approved by a vote of at least two-thirds of the
                Incumbent Board, such new director shall, for purposes of this
                Agreement, be considered as a member of the Incumbent Board;
                provided further, however, that no individual shall be
                considered a member of the Incumbent Board if such individual
                initially assumed office as a result of either an actual or
                threatened "election contest" (as described in Rule 14A-11
                promulgated under the Exchange Act) or other actual or
                threatened solicitation of proxies or consents by or on behalf
                of a Person other than the Board (a "Proxy Contest") including
                by reason of any agreement intended to avoid or settle any
                Election Contest or Proxy Contest; or

          (iii) consummation of:

                (A)  A merger, consolidation or reorganization involving Canaan,
                     unless:

                     (1) the stockholders of Canaan, immediately before such
                         merger, consolidation or reorganization, own directly
                         or indirectly immediately following such merger,
                         consolidation or reorganization, at least sixty percent
                         (60%) of the combined voting power of the outstanding
                         voting securities of the corporation resulting from
                         such merger or consolidation or reorganization (the
                         "Surviving Corporation") in substantially the same
                         proportion as their ownership of the Voting Securities
                         immediately before such merger, consolidation or
                         reorganization;

                     (2) the individuals who were members of the Incumbent Board
                         immediately prior to the execution of the agreement
                         providing for such merger, consolidation or
                         reorganization constitute at least two-thirds of the
                         members of the board of directors of the Surviving
                         Corporation; and

                     (3) no person other than Canaan, any subsidiary, any
                         employee benefit plan (or any trust forming a part
                         thereof) maintained by Canaan, the Surviving
                         Corporation, or any subsidiary, or

                                       2
<PAGE>

                         any person who, immediately prior to such merger,
                         consolidation or reorganization had Beneficial
                         Ownership of fifty percent (50%) or more of the then
                         outstanding Voting Securities, has Beneficial Ownership
                         of fifty percent (50%) or more of the combined voting
                         power of the Surviving Corporation's then outstanding
                         voting securities.

               (B)  a complete liquidation or dissolution of Canaan; or

               (C)  an agreement for the sale or other disposition of all or
                    substantially all of the assets of Canaan to any Person
                    (other than a transfer to a subsidiary).

     Notwithstanding the foregoing, a Change of Control shall not be deemed to
     occur solely because any Person (the "Subject Person") acquired Beneficial
     Ownership of more than the permitted percent of the outstanding Voting
     Securities as a result of the acquisition of Voting Securities by Canaan
     that, by reducing the number of Voting Securities outstanding, increases
     the proportional number of shares Beneficially Owned by the Subject Person,
     provided that if a Change of Control would occur (but for the operation of
     this sentence) as a result of the acquisition of Voting Securities by
     Canaan, and after such share acquisition by Canaan, the Subject Person
     becomes the Beneficial Owner of any additional Voting Securities that
     increases the percentage of the then outstanding Voting Securities
     Beneficially Owned by the Subject Person, then a Change of Control shall
     occur.

     (c)  "Code" shall mean the Internal Revenue Code of 1986, as amended.

     (d)  "Compensation" shall mean the sum of:

          (i)  Executive's annual salary at the rate in effect immediately prior
               to the date on which a Change of Control occurs; and

          (ii) the highest annual bonus received by Executive during the three
               (3) years immediately prior to the date on which a Change of
               Control occurs.

     (e)  "Involuntary Termination" shall mean any termination of Executive's
          employment with Canaan or its successor other than (i) termination for
          cause; (ii) termination as a result of death or disability; (iii)
          retirement; or (iv) resignation by Executive except resignation on or
          before the date that is ninety (90) days after the date upon which
          Executive receives notice of a Change in Duties.

     (f)  "Retirement" shall mean Executive's resignation on or after the date
          Executive reaches age sixty-five (65).

                                       3
<PAGE>

     (g)  "Severance Amount" shall mean an amount equal to three (3) times
          Executive's Compensation.

     (h)  "Termination for Cause" shall mean an Executive's termination of
          employment with Canaan or its successor because of:

          (i)  the continued failure by the Executive to devote reasonable time
               and effort to the performance of Executive's duties after written
               demand for improved performance has been delivered to the
               Executive by Canaan that specifically identifies how Executive
               has not devoted reasonable time and effort to the performance of
               Executive's duties; or

          (ii) the willful engaging by Executive in misconduct that is
               materially injurious to Canaan, monetarily and otherwise.

2.   SEVERANCE BENEFITS.  If Executive's employment by Canaan or its successor
     ------------------
is subject to an Involuntary Termination that occurs within two (2) years after
the date upon which a Change of Control occurs, then Executive shall be entitled
to receive, as additional compensation for services rendered to Canaan or its
successor, a lump sum cash payment in an amount equal to Executive's Severance
Amount but in no event greater than the amount that would be deductible by
Canaan under Code Section 280G, after taking into consideration all payments to
such Executive covered by such section, which shall be limited to those payments
calculated in the manner required under Section 280G an Executive receives or is
deemed to receive (i) under this Agreement; (ii) under the Canaan Stock Option
Plan by reason of the acceleration of any vesting of options granted thereunder;
or (iii) under any other plan or arrangement that would otherwise be considered
a "parachute payment" under Section 280G.  Such payment shall be accompanied by
a notice specifying the calculation of the payment as well as the amount of any
"parachute payments" and the Executive's deduction limit under section 280G.
Such notice shall contain sufficient detail to enable the Executive to challenge
Canaan's computation of any payment without significant additional information.

3.   TERM.  Within ninety (90) days after January 1, 2005, and within ninety
     ----
(90) days after each successive five-year (5) period of time thereafter that
this Agreement is in effect, Canaan shall have the right to review this
Agreement, and in its sole discretion either continue and extend this Agreement,
terminate this Agreement, and/or offer Executive a different agreement.  Canaan
will notify Executive of such action within said ninety (90) day period.  This
Agreement shall remain in effect until so terminated and/or modified by Canaan.
Failure of Canaan to take any action within said ninety (90) day period shall be
considered as an extension of this Agreement for an additional five-year (5)
period of time.  If a Change of Control occurs while this Agreement is in
effect, then this Agreement shall not be subject to termination or modification
and shall remain in force for a period of two (2) years after such Change of
Control, and if within said two (2) years the contingency factors occur that
would entitle Executive to the benefits as provided herein, this Agreement shall
remain in effect in accordance with its terms.

                                       4
<PAGE>

4.   GENERAL.
     -------

     (a)  Successors.  This Agreement shall be binding upon and inure to the
          ----------
          benefit of Canaan and any successor of Canaan, by merger or otherwise.
          This Agreement shall also be binding upon and inure to the benefit of
          the Executive and Executive's estate. If Executive shall die prior to
          full payment of amounts due pursuant to this Agreement, such amounts
          shall be payable pursuant to the terms of this Agreement to
          Executive's estate.

     (b)  Severability.  Any provision in this Agreement that is prohibited or
          ------------
          unenforceable in any jurisdiction by reason of applicable law shall,
          as to such jurisdiction, be ineffective only to the extent of such
          prohibition or unenforceability without invalidating or affecting the
          remaining provisions hereof, and any such prohibition or
          unenforceability in any jurisdiction shall not invalidate or render
          unenforceable such provision in any other jurisdiction.

     (c)  Controlling Law.  This Agreement shall be governed by, and construed
          ---------------
          in accordance with, the laws of the State of Oklahoma.

     (d)  Release.  As a condition to the receipt of any benefit under Paragraph
          -------
          2 hereof, Executive shall first execute a release, in the form
          established by Canaan, releasing Canaan, its shareholders, officers,
          directors, employees and agents from any and all claims and from any
          and all 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 Canaan or the termination of such employment.

     (e)  Unfunded Obligation.  The obligation to pay amounts under this
          -------------------
          Agreement is an unfunded obligation of Canaan and no such obligation
          shall create a trust or be deemed to be secured by any pledge or
          encumbrance on any property of Canaan.

     (f)  Not a Contract of Employment.  This Agreement shall not be deemed to
          ----------------------------
          constitute a contract of employment, nor shall any provision hereof
          effect (i) the right of Canaan to discharge Executive at will or (ii)
          the terms and conditions of any other agreement between Canaan and
          Executive except as provided herein. No severance compensation shall
          be payable hereunder as a result of any termination of employment
          before a Change of Control.

     (g)  Nonalienation.  No benefit payable hereunder may be assigned, pledged
          -------------
          or mortgaged and shall not be subject to legal process or attachment
          for claims of creditors of Executive except to the extent required by
          applicable law.

                        [SIGNATURES ON FOLLOWING PAGE]

                                       5
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
_____ day of ____________, _______.

                                      "EXECUTIVE"

                                      NAME

                              By:     _______________________________________
                              Title:  _______________________________________
                                      Canaan


                                      CANAAN ENERGY CORPORATION

                              By:     _______________________________________
                              Title:  _______________________________________

                                       6