Document:

Exhibit 10.3

Exhibit 10.3

ICG

Amended and Restated

Non-Management Director

Compensation Plan

Effective as of January 1, 2011, the Board of Directors (“Board”) of Internet Capital Group, Inc. (the “Company”)
hereby adopts this Amended and Restated Non-Management Director Compensation Plan (this “Plan”). This Plan amends and
restates in its entirety the text of the Company’s Amended and Restated Non-Management Director Compensation Plan,
dated as of January 1, 2007. The purpose of the Plan is to advance the interests of the Company’s stockholders by
providing non-management directors with financial and equity remuneration that allows the Company to attract and retain
qualified personnel to serve on the Company’s Board and to align their interests with those of the stockholders.

The Compensation Committee of the Board (the “Compensation Committee”) shall administer the Plan. The Compensation
Committee may delegate such administration as it deems appropriate.

 

	 	 	 
	1.

	 	Annual Board Retainer

Each non-management director shall receive $60,000 per year, payable $15,000 per quarter, during which such
non-management director serves as a member of the Board. Quarterly retainer fees shall be payable, in arrears, on the
first business day of each calendar quarter. Payments for service for a portion of a calendar quarter shall be
prorated.

 

	 	 	 
	2.

	 	Annual Committee Retainers

(a) Each non-management director who serves as Chairperson of the Audit Committee of the Board (the “Audit
Committee”) shall receive $25,000 per year, payable $6,250 per quarter, during which such non-management director
serves as Chairperson of the Audit Committee, and each other member of the Audit Committee shall receive $13,500 per
year, payable $3,375 per quarter, during which such non-management director serves as a member of the Audit Committee.

(b) Each non-management director who serves as Chairperson of the Compensation Committee shall receive $20,000 per
year, payable $5,000 per quarter, during which such non-management director serves as Chairperson of the Compensation
Committee, and each other member of the Compensation Committee shall receive $11,000 per year, payable $2,750 per
quarter, during which such non-management director serves as a member of the Compensation Committee.

(c) Each non-management director who serves as Chairperson of the Nominating and Governance Committee of the Board
(the “Nominating and Governance Committee”) shall receive $15,000 per year, payable $3,750 per quarter, during which
such non-management director serves as Chairperson of the Nominating and Governance Committee, and each other member of
the Nominating and Governance Committee shall receive $8,500 per year, payable $2,125 per quarter, during which such
non-management director serves as a member of the Nominating and Governance Committee.

(d) Each non-management director who serves as the lead independent director shall receive $10,000 per year,
payable $2,500 per quarter, for the term during which such non-management director serves as the lead independent
director.

(e) Quarterly retainer fees shall be payable, in arrears, on the first business day of each calendar quarter.
Payments for service for a portion of a calendar quarter shall be prorated.

 

	 	 	 
	3.

	 	Initial Equity Grant

Subject to Section 6 hereof, each non-management director shall be granted 25,000 Company stock appreciation rights
(“SARs”) at the first regularly scheduled Board meeting held where such non-management director serves as a member of
the Board. The SARs will have a base price equal to the fair market value of the Company’s common stock on the date of
grant, will vest 25% on each anniversary of the date of grant, provided the non-management director is still a member
of the Board, and will have a term of 8 years.

 

 

1

 

	 	 	 
	4.

	 	Annual Service Equity Grants

Subject to Section 6 hereof, at the first regularly scheduled meeting of the Board each calendar year, each
non-management director shall be granted 7,500 Deferred Stock Units (“DSUs”) for such non-management director’s service
on the Board for the forthcoming calendar year; provided; however, that in lieu of all or a portion of an annual DSU
grant, a director may elect to receive an equal number of shares of restricted stock in any given year provided that
such director has achieved and remains in compliance with the Company’s director stock ownership guidelines. Such
election must be made on or before December 31 of the year prior to the grant date of such equity grants. Equity grants
made pursuant to this Section 4 will vest on the first anniversary of the date of grant.

 

	 	 	 
	5.

	 	Deferred Stock Unit Program

Each non-management director shall be eligible to participate in the Deferred Stock Unit Program administered by the
Compensation Committee. Participation entitles the non-management director to receive, in exchange for deferring
receipt of all or a portion of such non-management director’s cash fees, a stock award, the receipt of which is
deferred until the non-management director terminates service. The stock award will provide each non-management
director with the deferred right to receive a number of shares equal to his or her deferred fees divided by the fair
market value of a share of the Company’s common stock as of the date on which his or her fees otherwise would have been
paid.

 

	 	 	 
	6.

	 	Equity Grants

Notwithstanding anything to the contrary in this Plan, all equity grants contemplated by this Plan shall be made on the
latest of (a) the date specified above, (b) the date permissible under the Company’s Equity Awards Grant Policy and
(c) promptly after the date that the Company has sufficient shares available for grant pursuant to an equity
compensation plan approved by stockholders. Additionally, the number of SARs, DSUs and shares of restricted stock set
forth above shall be subject to proportionate adjustment in the event of a stock split, reverse stock split,
combination, reclassification, stock dividend or other similar event.

 

	 	 	 
	7.

	 	Expenses

The Company shall reimburse non-management directors for reasonable, documented out-of-pocket expenses incurred by them
related to their attendance at Company meetings and otherwise incurred by them in service to the Company.

 

 

 

2exv10w16

Exhibit 10.16

CHANGE-IN-CONTROL EMPLOYEE SEVERANCE AGREEMENT

     This Change-in-Control Employee Severance Agreement (this “Agreement”), executed on to be
effective on October 1, 2009 (the “Effective Date”), is by and between Delta Petroleum Corporation,
a Delaware corporation (the “Company”), and Carl Lakey (the “Employee”).

STATEMENT OF PURPOSE

     The Company desires, for its continued success, to have the benefit of services of experienced
management personnel like the Employee. The Board of Directors of the Company (the “Board”)
therefore believes that it is in the best interest of the Company and its shareholders that, in the
event of a prospective Change-in-Control of the Company, the Employee be reasonably secure in his
employment and position with the Company, so that the Employee can exercise independent judgment as
to the best interest of the Company and its shareholders, without distraction by any personal
uncertainties or risks regarding the Employee’s continued employment with the Company created by
the possibility of such a Change-in-Control. Therefore, the Company and the Employee now desire to
enter into this Agreement to assure severance benefits to the Employee in connection with certain
terminations of employment upon or after a Change-in-Control of the Company.

AGREEMENT

     In consideration of the statements made in the Statement of Purpose and the mutual agreements
set forth below, the Company and the Employee hereby enter into this Agreement, as follows:

     1. Definitions and Interpretation. Various terms used in this Agreement are defined
in Exhibit A, and each of the defined terms used in this Agreement begins with a capital letter.
Various interpretative matters for this Agreement are also set forth in Exhibit A which is an
integral part of this Agreement and incorporated herein by reference.

     2. Effect of Agreement. Severance and other benefits shall be provided under this
Agreement only in the event of a Severance Payment Event (as defined in Exhibit A). If there is
not a Severance Payment Event, then any severance or other post-termination benefits shall be
provided under the terms and conditions of the Employment Agreement (as defined in Exhibit A) to
the extent applicable.

     3. Severance Benefits. Upon the occurrence of a Severance Payment Event, in addition
to any other severance or employment-termination compensation or benefits to which the Employee may
be entitled from the Company or any Subsidiary under the terms of any Plan (other than a severance
benefits plan for employees generally) of which the Employee was a participant or a beneficiary
immediately before the Severance Payment Event, the following shall occur:

          (a) The Company shall pay the Employee in cash, within five Business Days after the Severance
Payment Event, all of his Base Salary and all other earned but unpaid cash compensation or
entitlements due to the Employee through (and including) the date of the

 

 

Severance Payment Event, including unused earned and accrued vacation pay and unreimbursed
reimbursable business expenses.

          (b) The Company shall make the Severance Payment in cash in a lump sum to be paid to the
Employee within five Business Days after the Severance Payment Event.

          (c) The Company shall provide or arrange to provide the Employee (whether or not under any
Welfare Benefit Plan then maintained), at the Company’s sole expense and for the Benefit
Continuation Period, Welfare Benefits that are substantially the same as the Welfare Benefits
provided to the Employee (and the Employee’s spouse, dependents and beneficiaries) immediately
before the Severance Payment Event, except that the Welfare Benefits to which the Employee is
entitled under this subsection (c) will be subject to the Employee’s compliance with the
restrictions set out in Sections 4 through 13, and will be reduced to the extent that comparable
welfare benefits are received by the Employee from an employer other than the Company or any
Subsidiary during the Benefit Continuation Period; provided, however, for any Welfare Benefits
other than health insurance, in lieu of paying from such Welfare Benefits during the Benefit
Continuation Period, within 30 days after the Severance Payment Event, the Company shall pay to
Employee an amount equal to 36 times the excess of (i) the monthly premium payable immediately
prior to the Severance Payment Event for such Welfare Benefits substantially similar to those which
Employee (and Employee’s dependents) were receiving at such time, over (ii) the aggregate monthly
premiums(s) charged to the Employee for such coverage at such time. The fact that the cost of the
participation by the Employee, or the Employee’s spouse, dependents or beneficiaries, in any
Welfare Benefit Plan was paid indirectly by the Company, as a reimbursement or a credit to the
Employee, before the Severance Payment Event does not mean that the corresponding Welfare Benefits
were not “provided to the Employee” by the Company for the purpose of this subsection (c).
Notwithstanding the foregoing, this subsection (c) shall not apply if the Severance Payment Event
is attributable to the death of Employee; in such event, the Designated Beneficiary, spouse and
dependents of Employee shall be entitled to whatever rights and benefits they have under the
Plan(s) at the time of death and nothing herein shall be construed to limit such rights and
benefits. In the event that the Company cannot provide coverage under any Welfare Benefit Plan, as
described in this subsection (c), for the entire Benefit Continuation Period, or any portion
thereof, for whatever reason, then the Company shall pay the actuarial equivalent of the present
value of such foregone coverage for Employee (and his spouse, dependents and beneficiaries, as
applicable) directly to Employee in a cash lump sum payment. Such determination for each affected
Welfare Benefit Plan shall be made in good faith by the Compensation Committee.

          (d) Each Stock Award outstanding immediately before the Severance Payment Event and not yet
exercised or forfeited (as the case may be) will automatically accelerate and become fully vested,
exercisable, or nonforfeitable upon the Severance Payment Event, as though all requisite time had
passed to fully vest the Stock Award or cause it to become exercisable or nonforfeitable. In
addition to Stock Awards, any compensation due under a performance-based, long-term incentive plan
of the Company or a Subsidiary will automatically accelerate and become fully payable and
nonforfeitable upon the Severance Payment Event, as though all requisite time had passed to fully
vest such compensation and all requisite performance goals attributable thereto have been fully
attained or satisfied. Notwithstanding anything to the contrary, if the terms and conditions of
any Stock Award or

 

 

compensation due under a plan or agreement expressly provide for acceleration of such Stock
Award or compensation upon a Severance Payment Event in a manner inconsistent with the foregoing in
relation to an event constituting a Severance Payment Event, then such specific terms and
conditions shall prevail with respect to such Stock Award or compensation.

     In the event of any change to a Welfare Benefits Plan following a Severance Payment Event,
Employee and his spouse, dependents and beneficiaries, as applicable, shall be treated consistently
with the then-current officers of the Company (or its successor) with respect to the terms and
conditions of coverage and other substantive provisions of the Welfare Benefits Plan. Employee and
his spouse hereby agree to acquire and maintain any and all coverage for themselves and dependents
that either or both of them are entitled to at any time under (i) a health plan offered by another
employer or (ii) the Medicare program or any other medical coverage program of the United States or
any agency thereof.

     Notwithstanding any provision of this Agreement to the contrary, in order to receive the
severance benefits payable under Section 3 following a Severance Payment Event, the Employee must
first execute an appropriate release agreement (on a form provided by the Company) whereby the
Employee agrees to release and waive, in return for such severance benefits, any federal or state
claims or causes of action that he has or may have against the Company or a Subsidiary including,
without limitation, for unlawful discrimination, harassment or retaliation; provided, however, such
release agreement shall not release any claim or cause of action by or on behalf of the Employee
for (a) any payment or benefit that may be due or payable under this Agreement or any Plan prior to
the receipt thereof, (b) any willful failure by the Company to cooperate with Employee (i) in
exercising his vested stock options or (ii) in the receipt of the proceeds from, or sale of, his
shares of restricted stock in the Company, each in accordance with the terms of the respective Plan
and stock option and restricted stock agreement, as applicable, (c) non-payment of salary or
benefits to which he is entitled from the Company as of the Severance Payment Event, or (d) a
breach of this Agreement or the Employment Agreement by the Company.

     Notwithstanding any provision hereof to the contrary, the severance benefits and
post-termination restrictive covenants as provided in this Agreement shall not duplicate, or
otherwise be in addition to, similar severance benefits or covenants provided under the Employment
Agreement. This Agreement shall control and govern over the Employment Agreement in such respect
but only upon the occurrence of a Severance Payment Event hereunder.

     4. Nondisclosure and Noncompetition. As an inducement to the Company to enter into
this Agreement, the Employee represents to and covenants with or in favor of the Company his
compliance with the restrictive covenants in Sections 5 through 13, as a condition to the Company’s
obligation to continue to provide severance benefits to Employee under Section 3 and to make
Gross-Up Payments to the Employee under Section 14. The Company may refuse to continue providing
those severance benefits or to make any Gross-Up Payment if there is demonstrable noncompliance by
Employee, as reasonably determined in good faith by the Compensation Committee with notice to
Employee and 30 days to appeal such decision to the Compensation Committee.

 

 

     5. Trade Secrets.

          (a) Access to Trade Secrets. As of the Effective Date and on an ongoing basis, the
Company agrees to give Employee access to Trade Secrets which the Employee did not have access to,
or knowledge of, before the Effective Date.

          (b) Access to Specialized Training. As of the Effective Date and on an ongoing basis,
the Company has provided, and agrees to provide on an ongoing basis, Employee with Specialized
Training which the Employee did not have access to, or knowledge of, before the Effective Date.

          (c) Agreement Not to Use or Disclose Trade Secrets. In exchange for the Company’s
promises to provide Employee with access to Trade Secrets and Specialized Training and the other
benefits provided under this Agreement, Employee agrees that he will not during the Employment
Period, or at any time thereafter, disclose to anyone, including, without limitation, any person,
firm, corporation or other entity, or publish or use for any purpose, any Trade Secrets and
Specialized Training, except as required in the ordinary course of the Company’s business or as
authorized by the Board.

          (d) Agreement to Refrain from Defamatory Statements. Employee shall refrain, both
during the Employment Period and thereafter, from publishing any oral or written statements about
any directors, officers, employees, agents, investors or representatives of the Company or any
Affiliate that are slanderous, libelous, or defamatory; or that disclose private or confidential
information about the business affairs, directors, officers, employees, agents, investors or
representatives of the Company or any Affiliate; or that constitute an intrusion into the seclusion
or private lives of any of such directors, officers, employees, agents, investors or
representatives; or that give rise to unreasonable publicity about the private lives of such
persons; or that place any such person in a false light before the public; or that constitute a
misappropriation of the name or likeness of any such person. A violation or threatened violation
of these restrictive covenants may be enjoined by a court of law notwithstanding the arbitration
provisions of Section 22.

     6. Duty to Return Company Documents and Property. Upon termination of the Employment
Period, Employee shall immediately return and deliver to the Company any and all papers, books,
records, documents, memoranda and manuals, e-mail, electronic or magnetic recordings or data,
including all copies thereof, belonging to the Company or relating to its business, in Employee’s
possession, whether prepared by Employee or others. If at any time after the Employment Period,
Employee determines that he has any Trade Secrets in his possession or control, Employee shall
immediately return them to the Company, including all copies thereof.

     7. Best Efforts and Disclosure. Employee agrees that, while he is employed with the
Company, he shall devote his full business time and attention to the Company’s business and shall
use his best efforts to promote its success. Further, Employee shall promptly disclose to the
Company all ideas, inventions, computer programs, and discoveries, whether or not patentable or
copyrightable, which he may conceive or make, alone or with others, during the Employment Period,
whether or not during working hours, and which directly or indirectly:

 

 

          (a) relate to a matter within the scope, field, duties or responsibility of Employee’s
employment with the Company; or

          (b) are based on any knowledge of the actual or anticipated business or interests of the
Company; or

          (c) are aided by the use of time, materials, facilities or information of the Company.

     Employee assigns to the Company, without further compensation, any and all rights, title and
interest in all such ideas, inventions, computer programs and discoveries in all countries of the
world. Employee recognizes that all ideas, inventions, computer programs and discoveries of the
type described above, conceived or made by Employee alone or with others within 12 months after the
Employment Termination Date (voluntary or otherwise), are likely to have been conceived in
significant part either while employed by the Company or as a direct result of knowledge Employee
had of proprietary information or Trade Secrets. Accordingly, Employee agrees that such ideas,
inventions or discoveries shall be presumed to have been conceived during his Employment Period,
unless and until the contrary is clearly established by the Employee.

     8. Inventions and Other Works. Any and all writings, computer software, inventions,
improvements, processes, procedures and/or techniques which Employee may make, conceive, discover,
or develop, either solely or jointly with any other person or persons, at any time during the
Employment Period, whether at the request or upon the suggestion of the Company or otherwise, which
relate to or are useful in connection with any business now or hereafter carried on or contemplated
by the Company, including developments or expansions of its present fields of operations, shall be
the sole and exclusive property of the Company. Employee agrees to take any and all actions
necessary or appropriate so that the Company can prepare and present applications for copyright or
Letters Patent therefor, and secure such copyright or Letters Patent wherever possible, as well as
reissue renewals, and extensions thereof, and obtain the record title to such copyright or patents.
Employee shall not be entitled to any additional or special compensation or reimbursement
regarding any such writings, computer software, inventions, improvements, processes, procedures and
techniques. Employee acknowledges that the Company from time to time may have agreements with
other persons or entities which impose obligations or restrictions on the Company regarding
inventions made during the course of work thereunder or regarding the confidential nature of such
work. Employee agrees to be bound by all such obligations and restrictions, and to take all action
necessary to discharge the obligations of the Company.

     9. Non-Solicitation Restriction. To protect Trade Secrets, it is necessary to enter
into the following restrictive covenants which are ancillary to the enforceable promises between
the Company and Employee in Sections 5 through 8 and other provisions of this Agreement. Only if
there is a Severance Payment Event that results from Employee’s voluntary termination of employment
for Good Reason, Employee hereby covenants and agrees that he will not, directly or indirectly,
without the prior written consent of the Board or the Compensation Committee, either individually
or as a principal, partner, agent, consultant, contractor, employee, or as a director or officer of
any entity, or in any other manner or capacity whatsoever, except on

 

 

behalf of the Company, solicit business, or attempt to solicit business, in products or
services competitive with any products or services offered or performed by the Company or any
Subsidiary with respect to any property, drilling program, or oil or gas development prospect,
project or field, in which the Company or any Subsidiary does business or has any business interest
as of the Severance Payment Event, or either (a) from those individuals or entities with whom the
Company or Subsidiary was involved with, or participated in, any oil or gas exploration or
development project or (b) with respect to any property in which the Company or Subsidiary had any
working, royalty or other interest, at any time during the two year period ending on the Employment
Termination Date. The prohibitions set forth in this Section 9 shall remain in effect for a period
of one (1) year following the Employment Termination Date.

     10. Non-Competition Restriction. Employee hereby agrees that in order to protect
Trade Secrets, it is necessary to enter into the following restrictive covenant which is ancillary
to the enforceable promises between the Company and Employee in Sections 5 through 9 and other
provisions of this Agreement. Only if there is a Severance Payment Event that results from
Employee’s voluntary termination of employment for Good Reason, Employee hereby covenants and
agrees that during the Employment Period, and for a period of one (1) year following the Employment
Termination Date due to such Severance Payment Event, Employee will not, without the prior written
consent of the Board or the Compensation Committee, become interested in any capacity in which
Employee would perform any similar duties to those performed while at the Company, directly or
indirectly (whether as proprietor, stockholder, director, partner, employee, agent, independent
contractor, consultant, trustee, or in any other capacity), with respect to any property, drilling
program, oil or gas leasehold, project or field, in which the Company or any Subsidiary
participates, or has any investment or other business interest in, within the Restricted
Territory or within five (5) miles of the boundary of any existing Company leasehold in the United
States in which the Company or Subsidiary has conducted business at any time within the two-year
period immediately preceding the Severance Payment Event within a two-year period from such date (a
“Competing Enterprise”); provided, however, Employee shall not be deemed to be participating or
engaging in a Competing Enterprise solely by virtue of his ownership of not more than one percent
(1%) of any class of stock or other securities of the Competing Enterprise which are publicly
traded on a national securities exchange or in a recognized over the counter market.

     11. No-Recruitment Restriction. Employee agrees that during the Employment Period,
and for a period of one (1) year following the Employment Termination Date due to any Severance
Payment Event, Employee will not, either directly or indirectly, or by acting in concert with
others, solicit or influence, or seek to solicit or influence, any employee or independent
contractor performing services for the Company or any Subsidiary to terminate, reduce or otherwise
adversely affect his or her employment or other relationship with the Company or any Subsidiary.

     12. Tolling. If Employee violates any of the restrictions contained in Sections 5
through 11, then notwithstanding any provision hereof to the contrary, the restrictive period will
be suspended and will not run in favor of Employee from the time of the commencement of any such
violation until the time when the Employee cures the violation to the reasonable satisfaction of
the Board or Compensation Committee.

 

 

     13. Reformation. If a court or arbitrator rules that any time period or the
geographic area specified in any restrictive covenant in Sections 5 through 12 is unenforceable,
then the time period will be reduced by the number of months, or the geographic area will be
reduced by the elimination of such unenforceable portion, or both, so that the restrictions may be
enforced in the geographic area and for the time to the full extent permitted by law.

     14. Golden Parachute Excise Taxes; Section 409A.

          (a) If all or any portion of the Total Severance Benefits payable under this Agreement and any
other agreement under which a Stock Award or other compensation has been granted to Employee as
determined without regard to any additional payments required under this Section 14 (a “Payment”),
would be subject to the Excise Tax, then the Employee shall be entitled to receive an additional
payment (“Gross-Up Payment”) from the Company in an amount such that after payment by the Employee
of all taxes (including any interest or penalties imposed with respect to such taxes), including
any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax,
imposed upon the Gross-Up Payment, the Employee retains an amount of the Gross-Up Payment equal to
the Excise Tax imposed upon the Payment.

          (b) Subject to subsection (c) of this Section 14, all determinations required to be made under
this Section 14, including whether and when a Gross-Up Payment is required, the amount of any
Gross-Up Payment, and the assumptions to be used in arriving at such determination, shall be made
by the Accounting Firm, which shall be retained to provide detailed supporting calculations to the
Parties within 20 Business Days of the Accounting Firm’s receipt of written notice from the Company
or the Employee that there has been a Payment or such earlier time as is requested by the Company.
All fees and expenses of the Accounting Firm shall be paid solely by the Company. Each
determination by the Accounting Firm shall be binding upon the Parties. Any Gross-Up Payment
determined to be due to the Employee shall be paid by the Company within five Business Days of the
Company’s receipt of the Accounting Firm’s determination. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination by the Accounting
Firm, it is possible that Gross-Up Payments not made by the Company should have been made
consistent with the calculations required to be made under this Section 14 (“Underpayment”). If
the Company exhausts its remedies under subsection (c) of this Section 14 and the Employee
thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred, and any such Underpayment shall be promptly paid by
the Company to or for the benefit of the Employee.

          (c) The Employee shall Notify the Company of any claim by the Internal Revenue Service that,
if successful, would require the payment by the Company of the Gross-Up Payment. That Notice shall
be given as soon as practicable, but no later than 20 Business Days after the Employee is informed
in writing of such claim, and shall apprise the Company of the nature of such claim and the date on
which such claim is requested to be paid or appealed. The Employee shall not pay any amount
required by such claim before the expiration of the 30-day period following the date on which he
gives such Notice (or such shorter period ending on the date that any payment of taxes is due with
respect to such claim). If the Company Notifies the

 

 

Employee before the expiration of such period that it desires to contest such claim, the
Employee shall:

          (i) give the Company any information reasonably requested by the Company relating to
such claim;

          (ii) take such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including accepting representation with
respect to such claim by counsel or accountants (or both) selected by the Company and
reasonably acceptable to the Employee;

          (iii) cooperate with the Company in good faith in order to effectively contest such
claim; and

          (iv) permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and shall indemnify the
Employee, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties
with respect thereto) imposed as a result of such representation and payment of costs and expenses.
Without limiting the foregoing provisions of this subsection (c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any
and all administrative appeals, proceedings, hearings, and conferences with the taxing authority in
respect of such claim and may, at its sole option, direct the Employee either to pay the tax
claimed and sue for a refund or to contest the claim in any permissible manner, and the Employee
agrees to prosecute such contest to a determination before any administrative tribunal, in a court
of initial jurisdiction, and in one or more appellate courts, as the Company shall determine. If
the Company directs the Employee to pay such claim and sue for a refund, the Company shall advance
the amount of such payment to the Employee, on an interest-free basis, and shall indemnify the
Employee, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties
with respect thereto) imposed with respect to such advance or with respect to any imputed income
with respect to such advance; and provided further, that any extension of the statute of
limitations relating to payment of taxes for the Employee’s taxable year with respect to which such
contested amount is claimed to be due is limited solely to such contested amount. Further, the
Company’s control of the contest shall be limited to issues with respect to which a Gross-Up
Payment would be payable under this Section 14, and the Employee shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.

          (d) If, after the Employee’s receipt of an amount advanced by the Company under subsection (c)
above, the Employee becomes entitled to receive any refund with respect to such claim, the Employee
shall (subject to the Company’s complying with the requirements of subsection (c)) promptly pay to
the Company the amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the Employee’s receipt of an amount advanced by the Company
under subsection (c) above, a determination is made that the Employee is not entitled to any refund
with respect to such claim and the Company does not

 

 

notify the Employee in writing of its intent to contest such denial of refund within 30 days
after such determination, then such advance shall be forgiven and not be required to be repaid and,
in such event, the amount of such advance shall offset, to the extent thereof, the amount of the
Gross-Up Payment required to be paid.

     For purposes of calculating any income taxes attributable to the Payment, Employee shall be
deemed for all purposes to be paying income taxes at the highest marginal federal income tax rate,
taking into account any applicable surtaxes and other generally applicable taxes which have the
effect of increasing the marginal federal income tax rate and, if applicable, at the highest
marginal state income tax rate, to which the Payment and Employee are subject. An example of the
calculation of the Gross-Up Payment is set forth below. Assume that the Excise Tax rate is 20%,
the highest federal marginal income tax rate is 40% and Employee is not subject to state income
taxes. Further assume that Employee has received an excess parachute payment in the amount of
$200,000, on which $40,000 ($200,000 x 20%) in Excise Taxes are due. The amount of the required
Gross-Up Payment is thus computed to be $100,000, i.e., the Payment of $100,000, less additional
Excise Taxes on the Payment of $20,000 (i.e., 20% x $100,000) and less income taxes on the Payment
of $40,000 (i.e., 40% x $100,000), yields the net of $40,000, which is the amount of the Excise
Taxes owed by Employee in respect of the original excess parachute payment.

     Employee agrees to reasonably cooperate with the Company to minimize the amount of the excess
parachute payments, including, without limitation, assisting the Company in establishing that some
or all of the payments received by Employee that are “contingent on a change,” as described in
Section 280G(b)(2)(A) of the Code, are reasonable compensation for personal services actually
rendered by Employee before the date of such change or to be rendered by Employee on or after the
date of such change. Notwithstanding the foregoing, Employee shall not be required to take any
action which his attorney or tax advisor advises him in writing (i) is improper or (ii) exposes
Employee to personal liability. Employee may require the Company to deliver to Employee an
indemnification agreement, in form and substance reasonably satisfactory to him, as a condition to
taking any action required by this paragraph.

     The Company shall make any Gross-Up Payment required to be made under this Section 14 in a
cash lump sum after the date on which Employee received or is deemed to have received any such
excess parachute payment subject to Excise Tax. Any Gross-Up Payment which is not paid within 10
Business Days of receipt by the Company of Employee’s written demand therefor shall thereafter be
deemed delinquent, and the Company shall pay to Employee immediately upon demand interest at the
rate of 10% per annum from the date such Payment becomes delinquent to the date of payment of such
delinquent sum with interest.

     In the event that there is any change to the Code which results in the recodification of
Section 280G or Section 4999 of the Code, or in the event that either such section of the Code is
amended, replaced or supplemented by other provisions of the Code of similar import (“Successor
Provisions”), then this Agreement shall be applied and enforced with respect to such new Code
provisions in a manner consistent with the intent of the Parties as expressed herein, which is to
assure that Employee is in the same after-tax position and has received the same benefits that he
would have been in and received if any taxes imposed by Section 4999 (or any Successor Provisions)
had not been imposed.

 

 

     If the Accounting Firm determines that there is substantial authority (within the meaning of
Section 6662 of the Code) that no Excise Taxes are payable by Employee, the Accounting Firm shall
furnish Employee with a written opinion that failure to disclose or report the Excise Taxes on
Employee’s federal income tax return will not constitute a substantial understatement of tax or be
reasonably likely to result in the imposition of a negligence or any other penalty.

     The Company shall indemnify and hold harmless the Employee, on an after-tax basis, from any
costs, expenses, penalties, fines, interest or other liabilities (“Losses”) incurred by Employee
with respect to the exercise by the Company of any of its rights under this Section 14, including,
without limitation, any Losses related to the Company’s decision to contest a claim of any imputed
income to Employee. Any payments owing to Employee under this Section 14 and not made within 10
Business Days of delivery to the Company of evidence of Employee’s entitlement thereto shall be
paid to Employee together with interest computed at the rate of 10% per annum to the date of
payment of such delinquent sum with interest.

     (e) Section 409A of the Code.

     (i) Anything in this Agreement to the contrary notwithstanding, if (1) on the date of a
Severance Payment Event, any of the Company’s stock is publicly traded on an established
securities market or otherwise (within the meaning of Section 409A(a)(2)(B)(i) of the Code)
and (2) as a result of the Severance Payment Event, the Employee would receive any payment
that, absent the application of this paragraph (e), would be subject to interest and
additional tax imposed pursuant to Section 409A(a) of the Code as a result of the
application of Section 409A(2)(B)(i) of the Code, then no such payment shall be payable
prior to the date that is the earliest of (i) 6 months after the Severance Payment Event,
(ii) the Employee’s death or (iii) such other date as will cause such payment not to be
subject to such interest and additional tax.

     (ii) It is the intention of the Parties that payments or benefits payable under this
Agreement not be subject to the additional tax imposed pursuant to Section 409A of the Code.
To the extent such potential payments or benefits could become subject to such Section, the
Parties shall cooperate to amend this Agreement with the goal of giving Employee the
economic benefits described herein in a manner that does not result in such tax being
imposed.

     15. Employee’s Legal Expenses. The Company shall pay the Employee an amount equal to
the reasonable legal fees and other expenses incurred in good faith by him in obtaining or
retaining payments and benefits under this Agreement, including all such fees and expenses (if any)
in enforcing, in good faith, any right or benefit provided by this Agreement or in connection with
the contest or defense of any tax audit or proceeding by the Internal Revenue Service to the extent
that Section 4999 of the Code is alleged or claimed to apply to any payment or benefit provided
under this Agreement. The Company will be obligated under the preceding sentence even if the
Employee is not successful in any enforcement claim or counterclaim by him, or in any such tax
contest or defense, so long as he acted in good faith. The Company shall make any payment required
by this Section 15 within 20 Business Days after Notice from the Employee requesting payment and
providing such evidence of the incurrence of those fees and expenses as the Company may reasonably
request.

 

 

     16. No Mitigation. If a Severance Payment Event occurs, the Employee need not seek
other employment or attempt in any way to reduce the amount of payments due to Employee under this
Agreement, except as expressly provided in Section 3.

     17. No Set-off. The Company’s obligations under this Agreement are absolute and
unconditional, and not subject to any set-off, counterclaim, recoupment, defense, or other right
that the Company or any Subsidiary may have against the Employee, except as expressly provided in
Section 3 and Section 14.

     18. Tax Withholding. The Company shall withhold from any payments or benefits under
this Agreement (whether or not otherwise acknowledged under this Agreement) all federal, state,
local, or other taxes as it is legally required to withhold.

     19. Employment Status. Nothing in this Agreement provides the Employee with any right
to continued employment with the Company or any Subsidiary, or shall interfere with the Company’s
right to terminate the Employee’s employment at any time subject to the Company’s obligations under
the Employment Agreement.

     20. No Exclusivity. Nothing in this Agreement prevents or limits the Employee’s
participation in any Plan for which the Employee may qualify or shall impair any rights that the
Employee may have under any other contract or agreement with the Company or any Subsidiary.

     21. Indemnification. The Company shall indemnify, defend and hold harmless the
Employee from and against any and all liability, costs and damages arising from his service as an
employee, officer or director of the Company and/or its Affiliates as required by the certificate
of incorporation or bylaws of the Company. This Section 21 shall not limit in any way the rights
of Employee to any other indemnification from the Company or an Affiliate, as a matter of law,
contract or otherwise.

     22. Mandatory Arbitration. Except as provided in subsection (h) of this Section 22,
any Dispute must be resolved by binding arbitration in accordance with the following:

          (a) Either Party may begin arbitration by filing a demand for arbitration in accordance with
the Arbitration Rules and concurrently Notifying the other Party of that demand. If the Parties
are unable to agree upon a panel of three arbitrators within ten days after the demand for
arbitration was filed (and do not agree to an extension of that ten-day period), either Party may
request the Denver office of the American Arbitration Association (“AAA”) to appoint the arbitrator
or arbitrators necessary to complete the panel in accordance with the Arbitration Rules. Each
arbitrator so appointed shall be deemed accepted by the Parties as part of the panel.

          (b) The arbitration shall be conducted in the Denver, Colorado metropolitan area at a place
and time agreed upon by the Parties with the panel, or if the Parties cannot agree, as designated
by the panel. The panel may, however, call and conduct hearings and meetings at such other places
as the Parties may agree or as the panel may, on the motion of one Party, determine to be necessary
to obtain significant testimony or evidence.

 

 

          (c) The panel may authorize any and all forms of discovery upon a Party’s showing of need that
the requested discovery is likely to lead to material evidence needed to resolve the Dispute and is
not excessive in scope, timing, or cost.

          (d) The arbitration shall be subject to the Federal Arbitration Act and conducted in
accordance with the Arbitration Rules to the extent that they do not conflict with this Section 22.
The Parties and the panel may, however, agree to vary the provisions of this Section 22 or the
matters otherwise governed by the Arbitration Rules.

          (e) The arbitration hearing shall be held within 60 days after the appointment of the panel.
The panel’s final decision or award shall be made within 30 days after the hearing. That final
decision or award shall be made by unanimous or majority vote or consent of the arbitrators
constituting the panel, and shall be deemed issued at the place of arbitration. The panel’s final
decision or award shall be based on this Agreement and applicable law.

          (f) The panel’s final decision or award may include injunctive relief in response to any
actual or impending breach of this Agreement or any other actual or impending action or omission of
a Party under or in connection with this Agreement.

          (g) The panel’s final decision or award shall be final and binding upon the Parties, and
judgment upon that decision or award may be entered in any court having jurisdiction. The Parties
waive any right to apply or appeal to any court for relief from the preceding sentence or from any
decision of the panel made before the final decision or award.

          (h) Nothing in this Section 22 limits the right of either Party to apply to a court having
jurisdiction to (i) enforce the agreement to arbitrate in accordance with this Section 22, (ii)
seek provisional or temporary injunctive relief, in response to an actual or impending breach of
the Agreement or otherwise so as to avoid an irreparable damage or maintain the status quo, until a
final arbitration decision or award is rendered or the Dispute is otherwise resolved, or (iii)
challenge or vacate any final arbitration decision or award that does not comply with this Section
22. In addition, nothing in this Section 22 prohibits the Parties from resolving any Dispute (in
whole or in part) by agreement.

     The panel may proceed to an award notwithstanding the failure of any Party to participate in
such proceedings. The prevailing Party in the arbitration proceeding may be entitled to an award
of reasonable attorneys’ fees incurred in connection with the arbitration in such amount, if any,
as determined by the panel in its discretion. The costs of the arbitration shall be borne equally
by the Parties unless otherwise determined by the panel in its award.

     The panel shall be empowered to impose sanctions and to take such other actions as it deems
necessary to the same extent a judge could impose sanctions or take such other actions pursuant to
the Federal Rules of Civil Procedure and applicable law. Each party agrees to keep all Disputes
and arbitration proceedings strictly confidential except for disclosure of information required by
applicable law which cannot be waived.

     This Section 22 shall not preclude the Parties at any time from mutually agreeing to pursue
non-binding mediation of the Dispute.

 

 

     23. Company’s Successor. In addition to any obligations imposed by law upon any
successor to the Company, the Company shall require any successor to all or substantially all of
the Company’s business or assets (whether direct or indirect and whether by purchase,
reorganization, merger, share exchange, consolidation, or otherwise) to expressly assume and agree
to perform the Company’s obligations under this Agreement to the same extent, and in the same
manner, as the Company would be required to perform if no such succession had occurred. This
Agreement shall be binding upon, and inure to the benefit of, any successor to the Company.

     24. Employee’s Successor. This Agreement shall inure to the benefit of, and be
enforceable by, the Employee’s personal or legal representatives, Designated Beneficiary,
administrators, executors and heirs. If the Employee should die after a Severance Payment Event,
but before any payment or benefit to which the Employee is entitled under this Agreement has been
received by the Employee, all payments or benefits to which the Employee would have been entitled
had he continued to live (other than any such Welfare Benefits that, by their terms, terminate upon
the Employee’s death) shall be made or provided in accordance with this Agreement to the
representatives, executors, or administrators of the Employee’s estate.

     25. Restricted Assignment. Except as expressly provided in Sections 23 and 24,
neither Party may assign, transfer, or delegate this Agreement or any of its or his rights or
obligations under this Agreement without the prior written consent of the other Party. Any
attempted assignment, transfer, or delegation in violation of the preceding sentence shall be void
and of no effect.

     26. Waiver and Amendment. No term or condition of this Agreement shall be deemed
waived other than by a writing signed by the Party against whom or which enforcement of the waiver
is sought. Without limiting the generality of the preceding sentence, a Party’s failure to insist
upon the other Party’s strict compliance with any provision of this Agreement or to assert any
right that a Party may have under this Agreement shall not be deemed a waiver of that provision or
that right. Any written waiver shall operate only as to the specific term or condition waived
under the specific circumstances and shall not constitute a waiver of that term or condition for
the future or a waiver of any other term or condition. No amendment or modification of this
Agreement shall be deemed effective unless stated in a writing signed by the Parties.

     27. Entire Agreement. This Agreement, including the Statement of Purpose and any
other agreement referenced herein, contains the Parties’ entire agreement regarding the subject
matter of this Agreement and supersedes all prior agreements and understandings between them
regarding such subject matter. The Parties have made no agreements, representations, or warranties
regarding the subject matter of this Agreement that are not set forth in this Agreement.

     28. Notice. Each notice or other communication required or permitted under this
Agreement shall be in writing and transmitted, delivered, or sent by personal delivery, prepaid
courier or messenger service (whether overnight or same-day), prepaid telecopy or facsimile, or
prepaid certified United States mail (with return receipt requested), addressed (in any case) to
the

 

 

other Party at the address for that Party set forth below that Party’s signature on this
Agreement, or at such other address as the recipient has designated by Notice to the other Party.

     Each notice or communication so transmitted, delivered, or sent in person, by courier or
messenger service, or by certified United States mail shall be deemed given, received, and
effective on the date delivered to or refused by the intended recipient (with the return receipt,
or the equivalent record of the courier or messenger, being deemed conclusive evidence of delivery
or refusal.) Nevertheless, if the date of delivery is after 5:00 p.m. on a Business Day, the
notice or other communication shall be deemed given, received, and effective on the next Business
Day.

     29. Employee Acknowledgment. Employee acknowledges that (a) he is knowledgeable and
sophisticated as to business matters, including the subject matter of this Agreement, (b) he has
read this Agreement and understands its terms and conditions, (c) he has had ample opportunity to
discuss this Agreement with his legal counsel prior to execution, and (d) no strict rules of
construction shall apply for or against the drafter or any other Party. Employee represents that
he is free to enter into this Agreement including, without limitation, that he is not subject to
any restrictive covenant that would conflict with his duties under this Agreement.

     30. Severability. It is the desire of the Parties hereto that this Agreement be
enforced to the maximum extent permitted by law, and should any provision contained herein be held
unenforceable by a court of competent jurisdiction or arbitrator (pursuant to Section 22), the
Parties hereby agree and consent that such provision shall be reformed to create a valid and
enforceable provision to the maximum extent permitted by law; provided, however, if such provision
cannot be reformed, it shall be deemed ineffective and deleted herefrom without affecting any other
provision of this Agreement. This Agreement should be construed by limiting and reducing it only
to the minimum extent necessary to be enforceable under then applicable law.

     31. Title and Headings; Construction. Titles and headings to Sections hereof are for
the purpose of reference only and shall in no way limit, define or otherwise affect the provisions
hereof. The words “herein,” “hereof,” “hereunder” and other compounds of the word “here” shall
refer to the entire Agreement and not to any particular provision.

     32. Governing Law; Jurisdiction. All matters or issues relating to the
interpretation, construction, validity, and enforcement of this Agreement shall be governed by the
laws of the State of Colorado, without giving effect to any choice-of-law principle that would
cause the application of the laws of any jurisdiction other than Colorado. Jurisdiction and venue
of any action or proceeding relating to this Agreement or any Dispute (to the extent arbitration is
not required under Section 22) shall be exclusively in Denver, Colorado.

     33. Survival of Certain Provisions. Wherever appropriate to the intention of the
Parties, the respective rights and obligations of the Parties hereunder shall survive any
termination or expiration of this Agreement.

 

 

     34. Counterparts. This Agreement may be signed in counterparts, with the same effect
as if both Parties had signed the same document. All counterparts shall be construed together to
constitute one, and the same, document.

[Signature page follows.]

 

 

     IN WITNESS WHEREOF, the Parties have executed this Agreement to be effective as of the
Effective Date first above written.

	 	 	 

	WITNESS:

	 	EMPLOYEE:
	 
	 	 
	Signature: /s/ Stanley F. Freedman

	 	Signature: /s/ Carl E. Lakey
	Name: Stanley F. Freedman

	 	Name: Carl Lakey
	Date: October 26, 2009

	 	Date: October 26, 2009

Address for Notices:

Carl Lakey

____________________________________________

____________________________________________

____________________________________________

	 	 	 

	ATTEST:

	 	COMPANY:
	 
	 	 
	By: /s/ Stanley F. Freedman

	 	By: /s/ John R. Wallace
	Title: General Counsel

	 	Its: President
	Name: Stanley F. Freedman

	 	Name: John R. Wallace
	Date: October 27, 2009

	 	Date: October 27, 2009

Address for Notices:

Delta Petroleum Corporation

c/o Chairman of the Board

370 17th Street, Suite 4300

Denver, Colorado 80202

 

 

EXHIBIT A

TO

CHANGE-IN-CONTROL EMPLOYEE SEVERANCE AGREEMENT

     DEFINED TERMS. In the Agreement, the following terms have the corresponding meanings:

     “Accounting Firm” means an independent certified public accounting firm selected by the
Company and reasonably acceptable to the Employee; provided, however, the firm selected must be
within the top 15 in the United States at such time as the Agreement is in effect based on annual
revenues for CPA firms in the preceding year.

     “Acquiring Person” means any Person (other than an Excluded Person) who or which, alone or
together with all Affiliates and Associates of that Person, is the Beneficial Owner of 35% or more
of the Voting Securities of the Company then outstanding.

     “Affiliate” and “Associate” have the respective meanings ascribed to them in Rule 12b-2 under
the Exchange Act.

     “Agreement” means the Change-in-Control Employee Severance Agreement between the Parties, as
may hereafter be amended or supplemented, of which this Exhibit A is a part.

     “Arbitration Rules” means the Rules for Commercial Arbitration of the American Arbitration
Association as in effect at the time of arbitration of a Dispute.

     “Base Salary” means the Employee’s annual Base Salary from the Company under, and as defined
in, the Employment Agreement.

     “Beneficial Owner” means beneficial owner as defined in Rule 13d-3 under the Exchange Act.
(“Beneficially Owns” has the correlative meaning.) Any calculation of the number of Voting
Securities outstanding at any particular time, including for purposes of determining the particular
percentage of such outstanding Voting Securities of which any Person is the Beneficial Owner, shall
be made in accordance with Rule 13d-3(d)(1)(i) under the Exchange Act.

     “Benefit Continuation Period” means 36 consecutive months after a Severance Payment Event.

     “Board” means the Board of Directors of the Company.

     “Business Day” means any Monday through Friday, excluding any such day on which banks are
authorized to be closed in Colorado.

     “Cause” means any of the following: (A) the Employee’s conviction by a court of competent
jurisdiction as to which no further appeal can be taken of a crime involving moral turpitude or a
felony or entering the plea of nolo contendere to such crime by the Employee; (B) the commission by
the Employee of a material and demonstrable act of fraud, or a material and demonstrable
misappropriation of funds or property, of or upon the Company or any Affiliate; (C) the knowing
engagement by the Employee, without the written approval of the Board or

A-1

 

Compensation Committee, in any material activity which directly competes with the business of
the Company or any Affiliate, or which would directly result in a material injury to the business
or reputation of the Company or any Affiliate; or (D) (i) the material breach by Employee of any
material provision of this Agreement or the Employment Agreement, or (ii) the willful, material and
repeated nonperformance of Employee’s duties to the Company or any Subsidiary (other than by reason
of Employee’s illness or incapacity), but only under clauses (C), (D) (i) or (D) (ii) after Notice
from the Board or Compensation Committee of such material breach or nonperformance (which Notice
specifically identifies the manner and sets forth specific facts, circumstances and examples of
which the Board or Compensation Committee believes that Employee has breached the Agreement or the
Employment Agreement or not substantially performed his duties) and his continued willful failure
to cure such breach or nonperformance within the time period set by the Board or Compensation
Committee but in no event more than 60 calendar days after his receipt of such Notice; and, for
purposes of clause (D), no act or failure to act on Employee’s part shall be deemed “willful”
unless it is done or omitted by Employee without his reasonable belief that such action or omission
was in the best interest of the Company (assuming disclosure of the pertinent facts, any action or
omission by Employee after consultation with, and in accordance with the advice of, legal counsel
reasonably acceptable to the Company shall be deemed to have been taken in good faith and to not be
willful for purposes of this Agreement).

     “Change-in-Control” means the occurrence of any one or more of the following:

          (i) Any Person becomes an Acquiring Person, except as the result of (A) any acquisition of
Voting Securities of the Company by the Company or (B) any acquisition of Voting Securities of the
Company directly from the Company (as authorized by the Board).

          (ii) Individuals who constitute the Incumbent Board cease for any reason to constitute at
least a majority of the Board unless such change was approved by at least two-thirds (2/3) of the
Incumbent Board; and for this purpose, any individual who becomes a member of the Board after the
date of this Agreement whose election, or nomination for election by holders of the Company’s
Voting Securities, was approved by the vote of at least a majority of the individuals then
constituting the Incumbent Board shall be considered a member of the Incumbent Board (except that
any such individual whose initial election as director occurs as the result of an actual or
threatened election contest, within the meaning of Rule 14a-11 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 shall not be so considered).

          (iii) The consummation of a reorganization, merger, share exchange, consolidation, or sale or
disposition of all or substantially all of the assets of the Company unless, in any case, the
Persons who or which Beneficially Own the Voting Securities of the Company immediately before that
transaction Beneficially Own, directly or indirectly, immediately after the transaction, at least
70% of the Voting Securities of the Company or any other corporation or other entity resulting from
or surviving the transaction (including a corporation or other entity which, as the result of the
transaction, owns all or substantially all of Voting Securities of the Company or all or
substantially all of the Company’s assets, either directly or indirectly through one or more
subsidiaries) in substantially the same proportion as

A-2

 

their respective ownership of the Voting Securities of the Company immediately before that
transaction.

          (iv) The Company’s shareholders approve a complete liquidation or dissolution of the Company
or a sale of substantially all of its assets.

     “Code” means the Internal Revenue Code of 1986, as amended from time to time. References
herein to any Section of the Code shall include any successor provisions of the Code.

     “Common Stock” means the common stock, $.01 par value per share, of the Company.

     “Company” means Delta Petroleum Corporation, a Delaware corporation.

     “Compensation Committee” means the then-current compensation committee of the Board.

     “Disability” shall mean that Employee is entitled to receive long term disability (“LTD”)
income benefits under the LTD plan or policy maintained by the Company that covers Employee. If,
for any reason, Employee is not covered under such LTD plan or policy, then “Disability” shall mean
a “permanent and total disability” as defined in Section 22(e)(3) of the Code and Treasury
regulations thereunder. Evidence of such Disability shall be certified by a physician acceptable
to both the Company and Employee. In the event that the Parties are not able to agree on the
choice of a physician, each shall select one physician who, in turn, shall select a third physician
to render such certification. All costs relating to the determination of whether Employee has
incurred a Disability shall be paid by the Company. Employee agrees to submit to any examinations
that are reasonably required by the attending physician to determine whether he has a Disability.

     “Designated Beneficiary” means the Employee’s surviving spouse, if any. If there is no such
surviving spouse at the time of Employee’s death, then the Designated Beneficiary hereunder shall
be Employee’s estate.

     “Dispute” means any dispute, disagreement, claim, or controversy arising in connection with or
relating to the Agreement or the validity, interpretation, performance, breach, or termination of
the Agreement.

     “Employment Agreement” means the Employment Agreement between the Parties dated as of October
__, 2009, as may hereafter be amended or supplemented.

     “Employment Period” means the time period during which Employee is employed as an employee or
officer of the Company or any Subsidiary.

     “Employment Termination Date” means the date that the Employee’s employment with the Company
and any Subsidiary is terminated for whatever reason.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

A-3

 

     “Excise Tax” means the excise tax imposed by Section 4999 of the Code, with all interest and
penalties, if any, incurred with respect to such excise tax.

     “Excluded Person” means:

          (i) the Employee or any group (within the meaning of Section 13(d)(3) of the Exchange Act) of
which the Employee is a member;

          (ii) any Person that controls (as defined in Rule 12b-2 under the Exchange Act) the Company as
of the date of the Agreement or any group of which any such Person is a member;

          (iii) any employee-benefit plan, or related trust, sponsored or maintained by the Company or
any of its Subsidiaries, or any trustee or other fiduciary thereof; or

          (iv) any corporation or other entity owned directly or indirectly by the shareholders of the
Company in substantially the same proportions as their ownership of the Voting Securities of the
Company.

     “Good Reason” means the occurrence of any one or more of the following events (within the
period beginning six (6) months prior to a Change-in-Control and ending at the end of the
twenty-fourth (24th) month immediately following the month in which the Change-in-Control
occurred), except as a result of actions taken in connection with termination of the Employee’s
employment for Cause or Disability, and without Employee’s specific written consent:

          (i) If the Company becomes a division, a wholly or majority-owned subsidiary or other similar
captive entity of another person or entity or combination thereof (i.e. of a “parent”); and if the
Employee is not placed in the identical or equivalent position within the parent person or entity,
then such occurrence will be deemed to be an assignment of duties materially inconsistent with
Employee’s position as described above thereby constituting Good Reason. The assignment to the
Employee of any duties inconsistent in any material respect with the Employee’s position, within
the 6 month period prior to Change-in-Control or two years thereafter, which in this definition
includes status, reporting relationship to the top-paid corporate Employee, office, title, scope of
responsibility over corporate level staff or operations functions, or responsibilities as an
officer of the Company or any other material diminution in the Employee’s position, authority,
duties, or responsibilities, other than (in any case or circumstance) an isolated and inadvertent
action not taken in bad faith that is remedied by the Company promptly within 30 days after Notice
thereof to the Company by the Employee;

          (ii) the Company’s requiring the Employee to be based at any office or location farther than
35 miles from the Employee’s office or principal job location immediately before such change,
except for required business travel to an extent substantially consistent with the Employee’s
travel obligations immediately before the change;

          (iii) a reduction in the Employee’s Base Salary or annual bonus opportunity of more than five
percent (5%) from the highest amount in effect at any time within six months before the
Change-in-Control;

A-4

 

          (iv) a failure of the Company to provide salary increases to Employee as consistent with the
market and, in the event of a disagreement between the Parties, such determination shall be made by
the Compensation Committee based on the appropriate base pay annual adjustment norms for similar
Employees as determined from the Conference Board’s Annual Salary Increase Budget publication (or
an equivalent independent authoritative source as determined by the Compensation Committee);

          (v) the failure by the Company or any Subsidiary to continue to provide the Employee with
compensation that is equal or comparable to the Employee’s total compensation under the Employment
Agreement as in effect immediately before the change, unless an equitable arrangement (embodied in
an ongoing substitute or alternative Plan or arrangement) has been made with respect to that
compensation or any component thereof, or the failure by the Company or any Subsidiary to continue
the Employee’s participation in any compensation Plan in which the Employee participates
immediately before the change (or in any substitute or alternative Plan or arrangement) on a basis
not materially less favorable to the Employee, both in terms of the amount of benefits provided and
the level of the Employee’s participation relative to other participants, than existed at any time
within six (6) months before the Change-in-Control;

          (vi) the failure by the Company or any Subsidiary to continue to provide the Employee with
benefits similar in all material respects to those enjoyed by the Employee under the Employment
Agreement and under any Plan in which the Employee was participating at any time within six (6)
months before the Change-in-Control, the taking of action by the Company or any Subsidiary which
would directly or indirectly materially reduce any of such benefits or deprive the Employee of any
material fringe benefit enjoyed by the Employee at any time within six (6) months before the
Change-in-Control, or the failure by the Company or any Subsidiary to provide the Employee with the
number of paid vacation days to which the Employee is entitled on the basis of years of service
with the Company and its Subsidiaries in accordance with the Company’s or a Subsidiary’s vacation
policy in effect at any time within six (6) months before the Change-in-Control; or

          (vii) Any failure by the Company to obtain an assumption of this Agreement by its successor in
interest pursuant to Section 23.

     Notwithstanding the foregoing definition of “Good Reason,” the Employee cannot terminate his
employment hereunder for Good Reason unless he (a) first notifies the Board or Compensation
Committee in writing of the event (or events) which the Employee believes constitutes a Good Reason
event under subparagraphs (i), (ii), (iii), (iv), (v), (vi) or (vii) above within 150 calendar days
from the date of such event, and (b) provides the Company with at least 30 calendar days to cure,
correct or mitigate the Good Reason event so that it either (1) does not constitute a Good Reason
event hereunder or (2) Employee specifically agrees, in writing, that after any such modification
or accommodation made by the Company that such event shall not constitute a Good Reason event
hereunder.

     “Incumbent Board” means the members of the Board on the effective date of the Agreement
(subject, however, to clause (ii) of the definition of “Change-in-Control”).

A-5

 

     “Notice” means a written communication complying with Section 28 (“Notify” has the correlative
meaning).

     “Parties” means, collectively, the Company and the Employee. (“Party” means either the
Company or the Employee).

     “Person” means any individual, firm, corporation, partnership, limited liability company,
trust, or other entity, including any successor (by merger or otherwise) of such entity.

     “Plan” means any bonus, incentive compensation, savings, retirement, stock option, stock
appreciation, stock ownership or purchase, pension, deferred compensation, or Welfare Benefits
plan, policy, practice, program, or arrangement of (including any separate contract or agreement
with) the Company or any Subsidiary for its employees, but does not include the Employment
Agreement.

     “Restricted Territory” means, collectively, Denver, Colorado (and within a 100-mile radius of
the boundaries of Denver, Colorado); each county (or equivalent subdivision) of any state,
district, or territory of the United States of America as to which the Company conducts its
business; and each county (or equivalent territory) adjacent to any of the preceding counties (or
equivalent territories).

     “Severance Payment” means an amount equal to three (3) times the sum of:

          (i) the Employee’s highest Base Salary in effect at any time within 12 months before the
Change-in-Control; plus

          (ii) an amount equal to the annual average of the annual bonuses (includes any incentive cash
compensation) paid or payable to the Employee by the Company and any Subsidiary for the three
fiscal years of the Company immediately preceding the fiscal year in which the Change-in-Control
occurs, but not less than the greater of (a) Employee’s highest annual target bonus during any of
these three preceding fiscal years or (b) the Employee’s targeted bonus for the fiscal year in
which the Change-in-Control occurs.

     Notwithstanding the foregoing provisions of this definition, in the event that the Severance
Payment Event is attributable to termination of Employee’s employment due to his death or
Disability, the term “three (3) times” shall be replaced by “two (2) times” in the first line of
this definition.

     For clause (iii) of this definition: (a) the calculation of the average of the annual bonuses
of the Employee shall include a fiscal year during which the Employee was employed by the Company
and a participant in a bonus or incentive cash compensation Plan even if the Employee did not earn
any bonus or incentive cash compensation for that fiscal year; (b) the bonus or incentive cash
compensation paid or payable to the Employee for only part of a fiscal year of the Company shall be
annualized (on the same basis as the one on which the bonus or compensation was prorated) for that
fiscal year to calculate the average; and (c) the “targeted bonus” for the fiscal year of the
Company in which the Change-in-Control occurs shall be the amount identified as a “target” by the
Board (or the committee thereof that administers the bonus or incentive cash compensation Plan) for
the Employee.

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     “Severance Payment Event” means the termination of the Employee’s employment with the Company
and all Affiliates, for any reason other than (a) voluntarily by the Employee without Good Reason
or (b) involuntarily by the Company for Cause, which termination occurs at any time within the
period beginning six (6) months prior to a Change-in-Control and ending at the end of the
twenty-fourth (24th) month immediately following the month in which the Change-in-Control occurred.
Any termination of Employee’s employment that does not occur within the prescribed time limits, or
is otherwise not described in the first sentence hereof, shall not be considered a Severance
Payment Event. Any transfer of the Employee’s employment from the Company to an Affiliate, from an
Affiliate to the Company, or from one Affiliate to another Affiliate, is not a termination of the
Employee’s employment by the Company for purposes of the Agreement (though any such transfer might,
depending on the circumstances, constitute or result in a termination of employment by the Employee
for Good Reason).

     “Specialized Training” includes the training the Company provides to Employee that is unique
to its business and enhances Employee’s ability to perform Employee’s job duties effectively.
Specialized Training includes, without limitation, sales methods/techniques training; operation
methods training; engineering and scientific training; and computer and systems training.

     “Stock Award” means a stock option, stock appreciation right, restricted stock grant,
performance share plan, or any other agreement in which the Employee has, or will (by the passage
of time only, not based on the Employee’s performance) have, (a) an interest in capital stock of
the Company or a right to obtain capital stock or an interest in capital stock of the Company, or
(b) an interest or right whose economic value depends solely on the performance of the capital
stock of the Company.

     “Subsidiary” means a corporation or other entity, whether incorporated or unincorporated, of
which at least a majority of the Voting Securities is owned, directly or indirectly, by the
Company.

     “Total Severance Benefits” means the Severance Payment; all other payments and benefits
received or to be received by the Employee under the Agreement; and all payments, awards,
distributions, and benefits (and accelerations of any payment, award, distribution, or benefit), if
any, to which the Employee may be entitled, under any Plan or any other contract or agreement, upon
or as the result of a Change-in-Control or the termination of his employment with the Company, or
both.

     “Trade Secrets” means any and all information and materials (in any form or medium) that are
proprietary to the Company or a Subsidiary, or are treated as confidential by the Company or
Subsidiary as part of, or relating to, all or any portion of its or their business, including
information and materials about the products and services offered, or the needs of customers
served, by the Company or Subsidiary; compilations of information, records and specifications,
properties, processes, programs, and systems of the Company or Subsidiary; research of or for the
Company or Subsidiary; and methods of doing business of the Company or Subsidiary. Trade Secrets
include, without limitation, all of the Company’s or Subsidiary’s technical and business
information, whether patentable or not, which is of a confidential, trade secret or proprietary
character, and which is either developed by the Employee alone, with others

A-7

 

or by others; lists of customers; identity of customers; existing or prospective oil or gas
properties, investors, participation agreements, working, royalty or other interests; contract
terms; bidding information and strategies; pricing methods or information; computer software;
computer software methods and documentation; hardware; the Company’s or Subsidiary’s methods of
operation; the procedures, forms and techniques used in servicing accounts or properties; seismic,
geophysical, petrophysical, or geological data; well logs and other well data; and other documents,
information or data that the Company requires to be maintained in confidence for the Company’s
business success.

     “Voting Securities” means securities or other interests having by their terms ordinary voting
power to elect members of the board of directors of a corporation or individuals serving similar
functions for a noncorporate entity.

     “Welfare Benefits” means medical, prescription, dental, disability, group life, and accidental
death insurance (whether funded by insurance policy or self-insured by the Company or any
Subsidiary) provided or arranged by the Company or any Subsidiary to be provided to its employees
or former employees.

     “Welfare Benefit Plan” means any Plan that provides any Welfare Benefits.

     INTERPRETIVE MATTERS. In the interpretation of the Agreement, except where the context
otherwise requires:

          (a) “including” or “include” does not denote or imply any limitation;

          (b) “or” has the inclusive meaning “and/or;”

          (c) the singular includes the plural, and vice versa, and each gender includes each of the
others;

          (d) captions or headings are only for reference and are not to be considered in interpreting
the Agreement;

          (e) “Section” refers to a Section of the Agreement, unless otherwise stated in the Agreement;

          (f) “month” refers to a calendar month; and

          (g) a reference to any statute, rule, or regulation includes any amendment thereto or any
statute, rule, or regulation enacted or promulgated in replacement thereof.

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