Document:

exv10w1

 

Exhibit 10.1

DESCRIPTION OF THE 2006 CASH INCENTIVE PLAN

Purpose

On January 21, 2006, EchoStar Communications Corporation (“EchoStar”) established a short-term cash
incentive plan for the 2006 fiscal year (the “2006 Cash Incentive Plan”). The purpose of the 2006
Cash Incentive Plan is to promote EchoStar’s interests and the interests of EchoStar’s stockholders
by providing EchoStar’s key employees with financial rewards upon achievement of specified
short-term business objectives together with, for EchoStar’s executive officers, certain subjective
criteria.

Eligibility

The employees eligible to participate in the 2006 Cash Incentive Plan include EchoStar’s executive
officers, vice presidents, director-level employees and certain other key employees designated by
management of EchoStar.

Amount of Awards

The maximum amount payable to any participant under the 2006 Cash Incentive Plan upon satisfaction
of all applicable business goals and other criteria is equal to or less than each participant’s
annual base salary.Exhibit 10.1 - Schedule of 2005 Annual Bonuses

    Exhibit
      10.1

    

      Schedule
        of 2005 Annual Bonuses for

      Certain
        Executive Officers

      

      

      

      
        	
                Name
                  and Position

              	
                 

              	
                2005
                  Annual Bonus

              	 
	 	 	 	 
	
                S.P.
                  Johnson IV

                President
                  and Chief Executive Officer 

              	 	
                $

              	
                214,535

              	 
	 	 	 	 	 
	
                Paul
                  F. Boling

                Chief
                  Financial Officer, Vice President, Secretary and Treasurer

              	 	
                $

              	
                112,668

              	 
	 	 	 	 	 
	
                Gregory
                  E. Evans

                Vice
                  President of Exploration

              	 	
                $

              	
                89,409

              	 
	 	 	 	 	 
	
                J.
                  Bradley Fisher

                Vice
                  President of Operations

              	 	
                $

              	
                175,412

              	 
	 	 	 	 	 
	
                Jack
                  L. Bayless

                Vice
                  President of Land

              	 	
                $

              	
                31,823Exhibit 10.2 - Second Amendment to Contribution and Subscription Agreement

    Exhibit
      10.2

    
 

    Execution
      Version

     

    SECOND
      AMENDMENT TO

    CONTRIBUTION
      AND SUBSCRIPTION AGREEMENT

     

    This
      SECOND AMENDMENT TO CONTRIBUTION AND SUBSCRIPTION AGREEMENT (this “Amendment’),
      dated
      as of March 31, 2006, is entered into by and among Pinnacle Gas Resources,
      Inc.,
      a Delaware corporation (the “Company”),
      CCBM,
      Inc., a Delaware corporation (“CCBM”),
      U.S.
      Energy Corp., a Wyoming corporation (“US
      Energy”),
      Crested Corp., a Colorado corporation (“Crested”),
      and
      each of the CSFB Parties (as defined in the Contribution and Subscription
      Agreement (defined herein), and collectively with CCBM, US Energy and Crested,
      the “Investors”).

     

    W
      I T
      N E S SE T H:

     

    WHEREAS,
      the Company, CCBM, Rocky Mountain Gas, Inc., a Wyoming corporation
      (“RMG”),
      and
      the CSFB Parties (collectively, the “Parties”)
      are
      parties to that certain Contribution and Subscription Agreement, dated as of
      June 23, 2003 and amended by an Amendment to Contribution and Subscription
      Agreement dated August 9, 2005 (as so amended, the “Contribution
      and Subscription Agreement”);
      and

     

    WHEREAS,
      the Parties desire to amend certain terms of the Contribution and Subscription
      Agreement.

     

    NOW,
      THEREFORE, in consideration of the premises, mutual covenants and agreements
      hereinafter contained and for other good and valuable consideration, the receipt
      and sufficiency of which are hereby acknowledged, the Parties agree as
      follows:

     

    ARTICLE
      1

     

    Definitions

     

    All
      capitalized terms used in the recitals above and the succeeding provisions
      of
      this Amendment which are not defined herein shall have the meaning ascribed
      to
      such terms in the Contribution and Subscription Agreement, as amended by this
      Amendment. All sections referred to in this Amendment shall be references to
      sections in the Contribution and Subscription Agreement unless otherwise
      noted.

     

    ARTICLE
      2

     

    Amendments

     

    2.1 Section
      2.3
      is
      hereby amended by adding the following after subsection
      (e):

     

    (f) Effective
      as of the closing of the first Private Offering (as defined below) after the
      date hereof (such closing date, the “Exercise
      Date”),
      the
      options to purchase Additional Shares shall be exercised, and hereby will be
      deemed exercised, in full by each of (i) CCBM or any of its Permitted
      Transferees, in the case of the option described in Section
      2.3( a),
      and
      (ii) US Energy, Crested or any 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    of
      their
      Permitted Transferees, in the case of the option described in Section
      2.3(b),
      on a
“cashless” net exercise basis, in which case the Company will issue to the
      holder of the option the number of shares of Common Stock computed using the
      following formula:

     

    X
      =
Y(A-B)

    A

     

    Where:

     

    X
      =
      number of shares of Common Stock to be issued to the option holder upon exercise
      of the option;

     

    Y
      = total
      number of shares of Common Stock purchasable under the option;

     

    A
      = the
      Current Market Price of one share of Common Stock; and

     

    B
      = the
      Tranche A Price, to the extent the option relates to the Tranche A Shares,
      and
      the Tranche B Price, to the extent the option relates to the Tranche B Shares;
      provided,
      however,
      that
      the Tranche A Price and the Tranche B Price shall each be adjusted to take
      into
      account the 25-for-1 stock split with respect to the Company’s Common Stock in
      the form of a stock dividend of twenty-four (24) shares of Common Stock on
      each
      outstanding share of Common Stock, payable by distribution of newly issued
      shares.

     

    For
      purposes of this Section
      2.3,
      “Current
      Market Price”
means
      the price at which shares of Common Stock are offered and sold in the Private
      Offering. “Private
      Offering”
means
      a
      private placement of the Common Stock of the Company to “qualified institutional
      buyers” pursuant to Rule 144A and/or to “accredited investors” pursuant to
      Regulation D with net proceeds to the Company of not less than $100.0
      million.

     

    (g) Within
      three days after the Exercise Date, the Company, at its expense, shall cause
      to
      be issued in the name of, and delivered to, the option holder, or, subject
      to
      compliance with the provisions of this Agreement and the Securityholders
      Agreement, as the option holder (upon payment by the option holder of any
      applicable transfer taxes) may direct, a certificate(s) for the number of full
      shares of Common Stock to which the option holder shall be entitled upon such
      exercise plus, in lieu of any fractional share to which the option holder would
      otherwise be entitled, cash.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      3

     

    Miscellaneous

     

    3.1 Descriptive
      Headings.
      The
      descriptive headings of the several Sections of this Amendment are inserted
      for
      convenience only and do not constitute a part of this Amendment.

     

    3.2 Governing
      Law.
      This
      Amendment shall be construed and enforced in accordance with, and the rights
      of
      the parties shall be governed by, the law of the State of Texas, without giving
      effect to the choice of law or conflicts principles thereof.

     

    3.3 Counterparts.
      This
      Amendment may be executed by the parties hereto on separate counterparts
      (including by facsimile), and such counterparts taken together shall be deemed
      to constitute one and the same instrument.

     

    3.4 Notices.
      All
      communications and notices to the parties hereunder shall be given as provided
      in the Contribution and Subscription Agreement.

     

    3.5 Severability.
      Whenever possible, each provision of this Amendment will be interpreted in
      such
      manner as to be effective and valid under applicable Law, but if any provision
      of this Amendment is held to be prohibited or unenforceable in any jurisdiction,
      such provision will be ineffective only to the extent of such prohibition or
      unenforceability without invalidating 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.

     

    3.6 Further
      Assurances.
      In
      connection with this Amendment and the transactions contemplated hereby, each
      Party shall execute and deliver any additional documents and instruments and
      perform any additional acts that may be necessary or appropriate to effectuate
      and perform the provisions of this Amendment and those
      transactions.

     

    [Signature
      Pages to Follow]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the
      undersigned have executed this Amendment as of the date first set forth
      above.

     

    PINNACLE
      GAS RESOURCES, INC.

     

    By: /s/
      Peter G. Schoonmaker 

    Name:
      Peter G. Schoonmaker

    Title:
      Chief
      Executive Officer and President

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    
 

    CCBM,
      INC.

     

    By:
      By: /s/
      S.P. Johnson 

    Name:
      S.P. Johnson

    Title:
      President

     

    

     

    

     

    
      
        
          

           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

           

        

      

    

    U.S.
      ENERGY CORP.

     

    By: /s/
      Keith G. Larson 

    Name:
      Keith G. Larson

    Title:
      Chief
      Executive Officer

     

    CRESTED
      CORP.

     

    By: /s/
      Keith G. Larson 

    Name:
      Keith G. Larson 

    Title:
      Co-Chairman

     

    

     

    

     

    
      
        
          

           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

           

        

      

    

    MILLENNIUM
      PARTNERS II, L.P.

     

    
      	 	
              By:

            	
              DLJ
                Merchant Banking III, Inc.,

            

    

    as
      Managing General Partner

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Principal

     

    DLJ
      MERCHANT BANKING III, INC., 

    as
      Advisory General Partner on behalf of DLJ

    Offshore
      Partners III, C.V.

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Principal

     

    DLJ
      MERCHANT BANKING III, INC.,

    as
      Advisory General Partner on behalf of DLJ
      

    Offshore
      Partners III-1, C.V.
      and as
      attorney-in-

    fact
      for
      DLJ Merchant Banking III, L.P., as 

    Associate
      General Partner of DLJ Offshore Partners

    III-1,
      C.V.

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Principal

     

    DLJ
      MERCHANT BANKING III, INC.,

    as
      Advisory General Partner on behalf of DLJ
      

    Offshore
      Partners III-2, C.V.
      and as
      attorney-in-

    fact
      for
      DLJ Merchant Banking III, L.P., as 

    Associate
      General Partner of DLJ Offshore Partners

    III-2,
      C.V.

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Principal

     

     

    
      
        
          

           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

           

        

      

    

    DLJ
      MERCHANT BANKING PARTNERS III, L.P.

     

    
      	 	
              By:

            	
              DLJ
                Merchant Banking III, Inc.,

            

    

    as
      Managing General Partner

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Principal

     

    DLJ
      MB PARTNERS III GMBH & CO. KG

     

    
      	 	
              By:

            	
              DLJ
                Merchant Banking III, L.P.,

            

    

    as
      Managing Limited Partner

    By: DLJ
      Merchant Banking III, Inc.,

    as
      General Partner

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Principal

     

    By: DLJ
      MB
      GmbH, as General Partner

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Director

     

    MBP
      III PLAN INVESTORS, L.P.

     

    
      	 	
              By:

            	
              DLJ
                LBO Plans Management Corporation II, as General
                Partner

            

    

     

    By: /s/
      Michael S. Isikow 

    Name: Michael
      S. Isikow

    Title: Vice
      President

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