Document:

Document

Nerdy Inc.

Amendment to 2021 Equity Incentive Plan

(Adopted as of May 4, 2022) 

A.    Nerdy Inc., a corporation organized under the laws of the State of Delaware (the “Company”) established the Company’s 2021 Equity Incentive Plan (the “Plan”); 

B.    The Plan currently provides for 27,774,924 shares of Class A Common Stock (“Stock”) to be reserved for issuance under the Plan; and

C.    The Company now wishes to amend the Plan to (i) increase the number of shares of Common Stock reserved for issuance under the Plan to an aggregate of 12,500,000 shares and to modify Section 4(a) the Plan to reflect such increase and (ii) on January 1, 2023 and each January 1 thereafter, increase the number of shares of Stock reserved for issuance under the Plan by (a) five percent (5%) of the number of shares of Stock issued and outstanding on a pro forma basis on the immediately preceding December 31 including: (1) all shares of Stock underlying any then-outstanding stock options, stock appreciation rights, restricted stock units, and unvested restricted stock awards and (2) the exchange of all shares of the Company’s Class B common stock, par value $0.0001 per share (including the shares of Class B common stock underlying any stock awards in clause (1)) or (b) such lesser number of shares as determined by our Board. 

Now THEREFORE, effective immediately, the Plan is amended as follows:

    1.    The reference to “27,774,924 shares” in Section 4(a) of the Plan is amended to reference “40,274,924 shares.” 
2.    The following text is added to the end of Section 4(a) of the Plan: “On January 1, 2023 and each January 1 thereafter, the number of shares of Stock reserved and available for issuance under the Plan shall be cumulatively increased by (i) five percent (5%) of the number of shares of Stock issued and outstanding on a pro forma basis on the immediately preceding December 31 including: (A) all shares of Stock underlying any then-outstanding stock options, stock appreciation rights, restricted stock units, and unvested restricted stock awards and (2) the exchange of all shares of the Company’s Class B common stock, par value $0.0001 per share (including the shares of Class B common stock underlying any stock awards in clause (A)) or (ii) such lesser number of shares as determined by our Board. ”
    3.    In all other respects the Plan will remain the same.
In Witness Whereof, the Company has caused this Amendment to the Plan to be executed as of the date first written above:
                    Nerdy Inc. 

                    By:                         
    Charles K. Cohn
    Director and Chief Executive Officer 
1Exhibit
10.1

 

EMPLOYMENT
AGREEMENT

 

This
EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into effective as of May 5, 2022 (the “Effective Date”),
by and between U.S. Energy Corp., a Wyoming corporation (the “Company”), and Ryan Smith (“Employee”).

 

W
I T N E S S E T H :

 

WHEREAS,
the Company desires to employ Employee and Employee desires to be employed by the Company in accordance with the terms and conditions
set forth herein; and

 

NOW,
THEREFORE, in consideration of the promises and mutual covenants contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and Employee hereby agree as follows:

 

Section
1. Definitions.

 

(a)
“2021 Equity Incentive Plan” shall mean the U.S. Energy Corp. 2021 Equity Incentive Plan, including all amendments and restatements,
and as may be amended going forward from time to time.

 

(b)
“Accrued Obligations” shall mean (i) all accrued but unpaid Base Salary through the date of termination of Employee’s
employment, (ii) any unpaid or unreimbursed expenses incurred in accordance with Section 7 below, (iii) any benefits provided under the
Company’s employee benefit plans upon a termination of employment, in accordance with the terms contained therein, and (iv) reasonable
relocation costs, to the extent unpaid or unreimbursed, payable to Employee by the Company, in accordance with written Company policy.

 

(c)
“Affiliate” shall mean any person controlling, controlled by, or under common control with, another Person.

 

(d)
“Aggregate Change of Control Payments” shall have the meaning set forth in Section 8(g).

 

(e)
“Annual Cash Bonus” shall have the meaning set forth in Section 4(b).

 

(f)
“Target Cash Bonus” shall have the meaning set forth in Section 4(b).

 

(g)
“Equity Grants” shall have the meaning set forth in Section 4(c).

 

(h)
“Agreement” shall have the meaning set forth in the preamble hereto.

 

(i)
“Base Salary” shall mean the salary provided for in Section 4(a), as may be adjusted pursuant to Section 4(a).

 

(j)
“Board” shall mean the Board of Directors of the Company.

 

(k)
“Cause” shall mean (i) a material breach of the terms and conditions of Employee’s employment agreement with the Company,
(ii) Employee’s act(s) of gross negligence or willful misconduct in the course of Employee’s employment hereunder that is
injurious to the Company or any other member of the Company Group, (iii) willful failure or refusal by Employee to perform in any material
respect Employee’s duties or responsibilities, (iv) misappropriation by Employee of any assets of the Company or any other member
of the Company Group, (v) embezzlement or fraud committed by Employee, or at Employee’s direction, (vi) Employee’s conviction
of, or pleading “guilty” or “no contest” to a felony under state or federal law.

 

(l)
“Change of Control” shall mean the first to occur after the effective date of this Agreement of any of the following:

 

    	 

     

    

 

(i)
“change of control event” with respect to the Company, within the meaning of Treas. Reg. §1.409A-3(i)(5);

 

(ii)
a merger, consolidation, or reorganization of the Company with or involving any other entity, other than a merger, consolidation, or
reorganization that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 50% of the combined voting
power of the securities of the Company (or such surviving entity) outstanding immediately after such merger, consolidation, or reorganization.

 

(m)
“COBRA” shall mean the health care continuation provisions of Section 4980B(f) of the Code.

 

(n)
“Code” shall mean the Internal Revenue Code of 1986, as amended.

 

(o)
“Company” shall have the meaning set forth in the preamble hereto, and shall include any of its successors or assigns.

 

(p)
“Company Business” shall have the meaning in set forth in Section 12(a).

 

(q)
“Company Group” shall mean the Company together with any direct or indirect subsidiaries of the Company or any of its Affiliates.

 

(r)
“Compensation Committee” shall mean the committee of the Board designated to make compensation decisions relating to senior
executive officers of the Company Group.

 

(s)
“Confidential Information” shall have the meaning in set forth in Section 11(b).

 

(t)
“Disability” shall mean any physical or mental disability or infirmity of the Employee that has prevented the performance
of Employee’s duties for a period of (i) ninety (90) consecutive days or (ii) one hundred twenty (120) non-consecutive days during
any six (6) month period. Any question as to the existence, extent, or potentiality of Employee’s Disability upon which Employee
and the Company cannot agree shall be determined by a qualified, independent physician selected by the Company and approved by Employee
(which approval shall not be unreasonably withheld). The determination of any such physician shall be final and conclusive for all purposes
of this Agreement.

 

(u)
“Dodd-Frank Act” shall have the meaning in set forth in Section 23

 

(v)
“Effective Date” shall have the meaning set forth in the preamble hereto.

 

(w)
“Employee” shall have the meaning set forth in the preamble hereto.

 

(x)
“Good Reason” shall mean, without Employee’s consent, (i) the failure of the Company to pay any compensation hereunder
when due or to perform any other obligation of the Company under this Agreement, or (ii) the relocation of Employee’s Principal
Place of Employment by more than fifty (50) miles from those cities identified in 1(cc).

 

(y)
“Non-Exempt Deferred Compensation” shall have the meaning set forth in Section 14(d).

 

(z)
“Original Agreement” shall have the meaning set forth in the recitals hereto.

 

(aa)
“Performance Criteria” shall have the meaning set forth in Section 4(b).

 

(bb)
“Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock
company, trust (charitable or non-charitable), unincorporated organization, or other form of business entity.

 

    	 

     

    

 

(cc)
“Principal Place of Employment” shall mean the Principal Corporate Offices of U.S. Energy Corp in Houston, Texas or any future
geographic location determined by the Board of Directors of the Company.

 

(dd)
“Required Delay Period” shall have the meaning in set forth in Section 13(d)(i).

 

(ee)
“Restricted Territory” shall have the meaning set forth in Section 12(a).

 

(ff)
“Rules” shall have the meaning set forth in Section 24.

 

(gg)
“Specified Employee” shall have the meaning set forth in Section 13(d).

 

(hh)
“Term” shall mean the period specified in Section 2.

 

(ii)
“Work Product” shall have the meaning set forth in Section 11.

 

Section
2. Acceptance and Term. The Company agrees to employ Employee, and Employee agrees to serve the Company, on the terms and conditions
set forth herein. The “Term” shall mean the period commencing on the Effective Date and, unless terminated sooner as provided
in Section 8 hereof, continuing until January 1, 2024. This Agreement shall automatically renew for successive terms of one (1) year,
unless either party provides written notice within sixty (60) days prior to the expiration of the then current term that the Agreement
will not be renewed; provided, however, that nonrenewal of this Agreement shall in no event be treated as a termination of employment
with the Company unless Executive’s employment with the Company is actually terminated in connection with such nonrenewal, including
but not limited to Sections 10, 11 and 12.

 

Section
3. Position, Duties, and Responsibilities; Place of Performance.

 

(a)
During the Term, Employee shall be employed and serve as Chief Executive Officer of the Company and shall have such duties and responsibilities
as are commensurate with such title. In addition, Employee may serve as the “principal financial officer” of the Company
as that term is designated under Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended, except as may otherwise be determined
by the Board. The Employee shall report to the Board of Directors of the Company and shall carry out and perform all orders, directions
and policies given to Employee by the Board of Directors of the Company consistent with his position and title.

 

(b)
Employee shall devote his best efforts to the performance of his duties under this Agreement and shall not engage in any other business
or occupation during the Term that interferes with Employee’s exercise of judgment in the Company’s best interests. Notwithstanding
the foregoing, nothing herein shall preclude Employee from (i) serving as a member of the boards of directors or advisory boards (or
their equivalents in the case of a non-corporate entity) of non-competing businesses, (ii) engaging in charitable activities and community
affairs, and (iii) managing his personal investments and affairs; provided, however, that the activities set out in clauses
(i), (ii), and (iii) shall be limited by Employee so as not to materially interfere, individually or in the aggregate, with the performance
of his duties and responsibilities hereunder. Any relevant industry related involvement through ownership, board representation or investments
shall be disclosed to the Compensation Committee by the Employee.

 

Section
4. Compensation. During the Term, Employee shall be entitled to the following compensation:

 

(a)
Base Salary. Employee shall be paid an annualized Base Salary, payable in United States dollars and less applicable taxes and
deductions and in accordance with the regular payroll practices of the Company, of Three Hundred Thousand Dollars ($300,000) with such
adjustments, if any, as may be approved in writing by the Compensation Committee.

 

    	 

     

    

 

(b)
Annual Cash Bonus. During the Company’s relevant fiscal years, and subject to the satisfaction of applicable Performance
Criteria and any other conditions required by the Compensation Committee, the Employee shall be entitled to an annual cash bonus (“Annual
Cash Bonus”); provided, however, that the Annual Cash Bonus for the relevant fiscal years will be paid to the Employee within
the period necessary to satisfy the exemption from Code Section 409A (as defined below) for short term deferrals set forth in Treas.
Reg. §1.409A-1(b)(4) (which generally requires that payment be made not later than 2-1/2 months after the end of the year in which
the amount becomes vested). The Annual Cash Bonus shall be based on the Compensation Committee’s evaluation of the condition of
Company’s business, the results of operations, Employee’s individual performance for the performance period, the satisfaction
by Employee or the Company of goals and milestones, including goals based on Performance Objectives, as may be established by the Compensation
Committee, or any combination thereof (collectively, “Performance Criteria”). The performance period for the Annual Cash
Bonus shall be the relevant fiscal years of the Company or such other performance period as established by the Compensation Committee
in its sole discretion, with the applicable Annual Cash Bonus amounts adjusted for such performance period in proportion to the relevant
annual periods. Without limiting the full discretion of the Compensation Committee, this Agreement sets a Target Cash Bonus in the amount
of 100% of Annual Base Salary. The Annual Cash Bonus in any year may vary substantially from the Target Cash Bonus amount, and no Annual
Cash Bonus is guaranteed by this Agreement.

 

(c)
Long-term Equity Incentive Grants. The Employee shall be eligible to receive long-term equity incentive grants (“Equity
Grants”) pursuant to the 2021 Equity Incentive Plan (or any applicable successor plan), subject to applicable limitations in such
plan(s). Such grants, which may consist of any of the instruments permitted by the 2021 Equity Incentive Plan, shall be made at the timing
and discretion of the Compensation Committee and shall contain such terms, vesting provisions and performance criteria as the Compensation
Committee, in its sole discretion, shall determine.

 

Section
5. Employee Benefits.

 

(a)
General. During the Term, Employee shall be entitled to participate in health insurance, retirement plans, directors’ and
officers’ insurance coverage and other benefit programs provided to other senior executives of the Company, as in effect from time
to time and subject to any prescribed eligibility waiting periods.

 

(b)
Vacation and Time Off. During each calendar year of the Term, Employee shall be eligible for twenty (20) days paid time off, which
shall include vacation, sick pay and other paid and unpaid time off in accordance with the policies and practices of the Company, as
in effect from time to time.

 

Section
6. Key-Man Insurance. At any time during the Term, the Company shall have the right to insure the life of Employee for the sole
benefit of the Company, in such amounts, and with such terms, as it may determine. All premiums payable thereon shall be the obligation
of the Company. Employee shall have no interest in any such policy, but agrees to cooperate with the Company in procuring such insurance
by submitting to physical examinations, supplying all information required by the insurance company, and executing all necessary documents,
provided that no financial obligation is imposed on Employee by any such documents. Upon the termination of employment for any reason,
Company will allow Employee to convert the insurance policy to a personal life insurance policy at Employee’s sole cost and expense.

 

Section
7. Reimbursement of Business Expenses. Employee is authorized to incur reasonable business expenses in carrying out his duties
and responsibilities under this Agreement, and the Company shall promptly reimburse Employee for all such reasonable business expenses,
subject to documentation in accordance with written Company policy, as in effect from time to time.

 

Section
8. Termination of Employment.

 

(a)
General. The Term shall terminate earlier than as provided in Section 2 hereof upon the earliest to occur of (i) Employee’s
death, (ii) a termination by reason of a Disability, (iii) a termination by the Company with or without Cause, or (iv) a termination
by Employee with or without Good Reason.

 

(b)
Termination Due to Death or Disability. Employee’s employment shall terminate automatically upon his death. The Company
may terminate Employee’s employment immediately upon the occurrence of a Disability. In the event Employee’s employment is
terminated during the Term due to his death or Disability, subject to Section 8(h) of this Agreement for a termination due to Disability,
Employee or his estate or his beneficiaries, as the case may be, shall be entitled to:

 

    	 

     

    

 

(i)
The Accrued Obligations, which amount shall be paid within thirty (30) days from the date of such termination; and

 

(ii)
Any unpaid Annual Cash Bonus in respect of any completed fiscal year that has ended prior to the date of such termination with such amount
determined based on actual performance during such fiscal year as determined by the Compensation Committee, which amount shall be paid
on the sixtieth (60th) day following the date of such termination; and

 

(iii)
A lump sum payment of any non-discretionary Annual Cash Bonus that would have been payable based on actual performance with respect to
the year of termination in the absence of the Employee’s death or Disability, pro-rated for the period the Employee worked prior
to his death or Disability, and payable at the same time as the bonus would have been paid in the absence of the Employee’s death
or Disability; and

 

(iv)
Immediate vesting of any and all equity or equity-related awards previously awarded to the Employee, irrespective of type of award.

 

Following
such termination of Employee’s employment by reason of death or Disability, except as set forth in this Section 8(b), Employee
shall have no further rights to any compensation or any other benefits under this Agreement.

 

(c)
Termination by the Company for Cause.

 

(i)
The Company may terminate Employee’s employment at any time for Cause; provided, however, that with respect to any
Cause of termination relying on clause (i) or (ii) of the definition of Cause set forth in Section 1(l) hereof, to the extent such act
or acts are curable, Employee shall be given not less than sixty (60) days’ written notice by the Board of the Company’s
intention to terminate Employee’s employment for Cause, such notice to state in detail the particular act or acts or failure or
failures to act that constitute the grounds on which the proposed termination for Cause is based, and such termination shall be effective
at the expiration of such sixty (60) day notice period, unless Employee has substantially cured, to the Company’s satisfaction,
such act or acts or failure or failures to act that give rise to Cause during such period.

 

(ii)
In the event the Company terminates Employee’s employment for Cause, Employee shall be entitled only to the Accrued Obligations,
which amount shall be paid within thirty (30) days from the date of such termination, and any equity awards or equity-related awards
that are not vested as of the date of termination shall be cancelled. Following such termination of Employee’s employment for Cause,
except as set forth in this Section 8(c)(ii), Employee shall have no further rights to any compensation or any other benefits under this
Agreement (including, but not limited to, any payment of any bonus that has not been paid as of the date of Employee’s termination
of employment).

 

(d)
Termination by the Company without Cause. The Company may terminate Employee’s employment at any time without Cause. In
the event Employee’s employment is terminated during the Term by the Company without Cause (other than due to death or Disability)
and subject to the terms of Section 8(h), Employee shall be entitled to:

 

(i)
The Accrued Obligations; and

 

(ii)
Any unpaid Annual Cash Bonus in respect of any completed fiscal year that has ended prior to the date of such termination with such amount
determined based on actual performance during such fiscal year as determined by the Compensation Committee; and

 

    	 

     

    

 

(iii)
A lump sum cash payment equal to twelve (12) months compensation at the sum of the Employee’s Base Salary and Target Annual Bonus;
and

 

(iv)
A lump sum cash payment equal to the value of any non-discretionary Annual Cash Bonus that would have been payable based on actual performance,
pro-rated for the period the Employee worked prior to termination; and

 

(v)
For a maximum period of twelve (12) months, a monthly cash payment equal to the “applicable percentage” of the monthly COBRA
premium cost applicable to Employee if Employee (or his dependents) is eligible, elects and continues COBRA coverage, or similar coverage
as provided by similar state law, in connection with such termination, (for purposes hereof, the “applicable percentage”
shall be the percentage of Employee’s health care premium costs covered by the Company as of the date of termination and the Company
shall be obligated to provide only such continuation of insurance benefits as it is required and can legally provide under its health
insurance contract); and

 

(vi)
Immediate vesting of any and all equity or equity-related awards previously awarded to the Employee that vest solely on the service of
Employee. Any equity awards that vest based on various performance metrics will be vested only if such performance metrics have been
met at the time of termination of service.

 

Any
amounts payable to Employee under clause (i), (ii), (iii) or (iv) of this Section 8(d) shall be paid in lump sum on the sixtieth (60th)
day following the date of Employee’s termination of employment, subject to Section 8(h) of this Agreement. Following such termination
of Employee’s employment by the Company without Cause, except as set forth in this Section 8(d), Employee shall have no further
rights to any compensation or any other benefits under this Agreement.

 

(e)
Termination by Employee with Good Reason. Employee may terminate Employee’s employment during the Term with Good Reason
by providing the Company thirty (30) days’ written notice setting forth in reasonable specificity the event that constitutes Good
Reason (which notice must be given no later than ninety (90) days after the initial occurrence of such event). During such thirty (30)
day notice period, the Company shall have a cure right (if curable), and if not cured within such period, Employee’s termination
will be effective upon the expiration of such cure period, and, subject to the terms of Section 8(h), Employee shall be entitled to:

 

(i)
The Accrued Obligations; and

 

(ii)
Employee shall be entitled to the same payments and benefits as provided in Section 8(d) (ii), (iii), (iv), (v) & (vi) above for
a termination by the Company without Cause, subject to the same conditions on payment and benefits as described in Section 8(d) above.

 

Following
such termination of Employee’s employment by Employee with Good Reason, except as set forth in this Section 8(e), Employee shall
have no further rights to any compensation or any other benefits under this Agreement.

 

(f)
Termination by Employee without Good Reason. Employee may terminate Employee’s employment without Good Reason by providing
the Company sixty (60) days’ written notice of such termination. In the event of a termination of employment by Employee under
this Section 8(f), Employee shall be entitled only to the Accrued Obligations, and any equity awards or equity-related awards that are
not vested as of the date of termination shall be cancelled. In the event of termination of Employee’s employment under this Section
8(f), the Company may, in its sole and absolute discretion, by written notice accelerate such date of termination without changing the
characterization of such termination as a termination by Employee without Good Reason. Following such termination of Employee’s
employment by Employee without Good Reason, except as set forth in this Section 8(f), Employee shall have no further rights to any compensation
or any other benefits under this Agreement.

 

(g)
Termination Following Change of Control. If, upon a Change of Control of the Company or during the twenty-four (24) month period
following such Change of Control, Employee is terminated by the Company without Cause or Employee terminates Employee’s employment
with Good Reason, Employee shall be entitled to the same payments and benefits as provided in Section 8(d) (i), (ii), (iv), (v) &
(vi) above for a termination by the Company without Cause, subject to the same conditions on payment and benefits as described in Section
8(d) above, plus a lump-sum cash payment equal to two (2.0) times the sum of Employee’s Base Salary and Target Cash Bonus in effect
on the date of the Change of Control. In addition, the Compensation Committee, in its sole discretion, may award an additional cash bonus
related to the Change of Control transaction, if the terms of the transaction are deemed to be significantly favorable to the Company.
Following such termination of Employee’s employment by the Company without Cause or by Employee with Good Reason following a Change
of Control, except as set forth in this Section 8(g), Employee shall have no further rights to any compensation or any other benefits
under this Agreement. The provisions of this Section 8(g) shall continue to apply for the twenty-four (24) month period after a Change
of Control, without regard to whether this Agreement is renewed after such Change of Control.

 

    	 

     

    

 

(h)
Release. Notwithstanding any provision herein to the contrary, and as a condition precedent to payment of any amount or provision
of any benefit pursuant to subsection 8(b), (d), (e) or (g) (other than payment of any Accrued Obligations) (the “Severance Benefits”),
Employee or Employee’s estate, as applicable, shall execute and shall not rescind, a release in favor of the Company Group and
all related companies, individuals, and entities, in a form satisfactory to the Company, and any revocation period applicable to such
release must have expired as of the sixtieth (60th) day following Employee’s termination of employment. If Employee
fails to execute the release in such a timely manner so as to permit any revocation period to expire prior to the end of such sixty (60)
day period, or timely revokes his acceptance of such release following its execution, Employee shall not be entitled to any of the applicable
Severance Benefits. Further, to the extent that (i) such termination of employment occurs within sixty (60) days of the end of any calendar
year, and (ii) any of the Severance Benefits constitutes “nonqualified deferred compensation” for purposes of Section 409A,
any payment of any amount or provision of any benefit otherwise scheduled to occur prior to the sixtieth (60th) day following
the date of Employee’s termination of employment hereunder, but for the condition on executing the release as set forth herein,
shall not be made prior to the first day of the second calendar year, after which any remaining Severance Benefits shall thereafter be
provided to Employee according to the applicable schedule set forth herein.

 

Section
9. Representations and Warranties of Employee. Employee represents and warrants to the Company that:

 

(a)
Employee is entering into this Agreement voluntarily and that Employee’s employment hereunder and compliance with the terms and
conditions hereof will not conflict with or result in the breach by Employee of any agreement to which Employee is a party or by which
Employee may be bound;

 

(b)
Employee has not violated, and in connection with Employee’s employment with the Company will not violate, any non-solicitation,
non-competition, or other similar covenant or agreement of a prior employer by which Employee is or may be bound; and

 

(c)
in connection with Employee’s employment with the Company, Employee will not use any confidential or proprietary information Employee
may have obtained in connection with employment with any prior employer.

 

Section
10. Nondisclosure and Nonuse of Confidential Information.

 

(a)
Employee will not disclose or use at any time, either during the Term or thereafter, any Confidential Information (as defined below)
of which Employee is or becomes aware, whether or not such information is developed by him, except to the extent that such disclosure
or use is directly related to and required by Employee’s performance in good faith of duties assigned to Employee by the Company.
Employee will take all appropriate steps to safeguard Confidential Information and to protect it against disclosure, misuse, espionage,
loss and theft. Employee shall deliver to the Company at the termination of the Term, or at any time the Company may request, all memoranda,
notes, plans, records, reports, disks, computer tapes and software and other documents and data (and copies thereof, regardless of the
form thereof, including electronic copies) relating to the Confidential Information or the Work Product (as defined below) of the business
of the Company or any of the Company’s Affiliates, which Employee may then possess or have under his control.

 

    	 

     

    

 

(b)
As used in this Agreement, the term “Confidential Information” means confidential, proprietary, trade secret, proprietary,
scientific, technical, business or financial information that is not generally known to the public and that is used, developed or obtained
by the Company or any Affiliate, in connection with their respective businesses, including, but not limited to, information, observations
and data obtained or learned by Employee while employed by the Company or any of its Affiliates (including those obtained or learned
prior to the date of this Agreement) concerning (i) the business or affairs of the Company or any Affiliate, (ii) products or services,
(iii) geologic data, (iv) seismic data, (v) analyses, (vi) drawings, photographs and reports, (vii) computer software, including operating
systems, applications and program listings, (viii) flow charts, manuals and documentation, (ix) data bases, (x) accounting and business
methods, (xi) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced
to practice, (xii) customers, clients, suppliers and subcontractors and customer, client, supplier and subcontractor lists, (xiii) other
copyrightable works, (xiv) all drilling methods, processes, technology and trade secrets, (xv) business strategies, acquisition plans
and target properties, financial or other performance data and personnel lists and data, and (xvi) all similar and related information
in whatever form. All such Confidential Information is extremely valuable and is intended to be kept secret to the Company and its clients
and customers, is the sole and exclusive property of the Company or its clients and customers, and is subject to the restrictive covenants
set forth herein.

 

Notwithstanding
anything to the contrary contained herein, Employee shall not be required to maintain as confidential any information or material which:

 

(i)
is now, or hereafter becomes, through no act or failure to act on the part of Employee which would constitute a breach of this Section
11, generally known or available to the public;

 

(ii)
is furnished to Employee by a third party who, to the knowledge of Employee, is not under obligations of confidentiality to the Company
or any of its Affiliates, without restriction on disclosure;

 

(iii)
is disclosed with the written approval of the Company;

 

(iv)
is required to be disclosed by law, court order, or similar compulsion; provided, however, that such disclosure shall be limited
to the extent so required or compelled; and provided, further, that Employee shall give the Company notice of such disclosure
and cooperate (without cost to Employee) with the Company in seeking suitable protection; or

 

(v)
is disclosed pursuant to or in connection with any legal proceeding involving Employee and/or the Company or any Affiliate thereof.

 

Section
11. Inventions, Discoveries and Patents. Employee agrees that all inventions, discoveries, innovations, improvements, technical
information, systems, software developments, methods, designs, analyses, drawings, reports, service marks, trademarks, trade names, logos
and all similar or related information (whether patentable or unpatentable) which relate to the Company’s or any of its Affiliates’
business or research and development and any existing or future products or services and which are or were discovered, conceived, developed
or made by Employee (whether or not during usual business hours or on the premises of the Company and whether or not alone or in conjunction
with any other person) while employed by the Company or any Affiliate (including those conceived, developed or made prior to the date
of this Agreement) together with all patent applications, letters patent, trademark, trade name and service mark applications or registrations,
copyrights and reissues thereof that may be granted for or upon any of the foregoing (collectively referred to herein as, the “Work
Product”), belong in all instances to the Company or such Affiliate. Employee will promptly disclose such Work Product to the Board
and assign to and otherwise perform (without cost to Employee) all actions reasonably requested by the Board (whether during or after
the employment period) to establish and confirm the Company’s or Affiliate’s exclusive ownership of such Work Product (including,
without limitation, the execution and delivery of assignments, consents, oaths, powers of attorney and other instruments) and to provide
reasonable assistance to the Company or any of its Affiliates in connection with the prosecution of any applications for patents, trademarks,
trade names, service marks or reissues thereof or in the prosecution or defense of interferences relating to any Work Product.

 

    	 

     

    

 

Section
12. Post-Termination Non-Compete, Non-Solicitation.

 

(a)
If Employee’s employment terminates pursuant to Sections 8(c), 8(d), 8(e), 8(f) or 8(g) hereof during the Term or for any reason
thereafter, Employee agrees that, for a period ending six 6 months from the date of his termination of employment, Employee shall not
(except on behalf of the Company or with the prior written consent of the Company), directly or indirectly, (i) engage in the business
in which the Company is engaged or proposes to be engaged (the “Company Business”), within the Restricted Territory (as defined
below), (ii) interfere with the Company Business or the business of any Affiliate, or (iii) own, manage, control, participate in, consult
with, render services for or in any manner engage in or represent any business within the Restricted Territory that is competitive with
the Company Business or the business of any Affiliate thereof or any product of the Company or any Affiliate, as such business is conducted
or proposed to be conducted from and after the date of this Agreement. As used in this Agreement, the term “Restricted Territory”
means any county in the United States where the company holds mineral lease interests. Nothing herein shall prohibit Employee from being
a passive owner of not more than five percent (5%) of the outstanding stock of any class of a corporation that is competitive with the
Company Business and which is publicly traded, so long as Employee has no active participation in the business of such corporation.

 

(b)
If Employee’s employment terminates pursuant to Sections 8(c), 8(d), 8(e), 8(f) or 8(g) hereof during the Term or for any reason
thereafter, Employee agrees that, for a period ending one (1) year from the date of his termination of employment, Employee shall not
directly or indirectly through another person or entity (i) induce or attempt to induce any employee of the Company or any Affiliate
of the Company to leave the employ of the Company or such Affiliate, or in any way interfere with the relationship between the Company
or any such Affiliate, on the one hand, and any employee or consultant thereof, on the other hand, (ii) hire or engage as a consultant
or otherwise any person who is or was an employee or consultant of the Company or any Affiliate thereof until six (6) months after such
individual’s employment or consulting relationship with the Company or such Affiliate has been terminated or (iii) induce or attempt
to induce any customer, supplier, subcontractor, licensee or other business relation of the Company or any Affiliate to cease doing business
with the Company or such Affiliate, or in any way interfere with the relationship between any such customer, supplier, subcontractor,
licensee or business relation, on the one hand, and the Company or any Affiliate, on the other hand.

 

(c)
Employee acknowledges that the covenants contained in this Section 13, including those related to duration, geographic scope, and the
scope of prohibited conduct, are reasonable and necessary to protect the legitimate interests of the Company. Employee acknowledges that
he is an executive and management level employee as referenced in, and governed by, C.R.S. § 8-2-113(2)(d). Employee further acknowledges
that the covenants contained in this Section 13 are necessary to protect, and reasonably related to the protection of, the Company’s
trade secrets, to which Employee will be exposed and with which Employee will be entrusted.

 

(d)
Employee shall inform any prospective or future employer of any and all restrictions contained in this Agreement and provide such employer
with a copy of such restrictions (but no other terms of this Agreement), prior to the commencement of that employment.

 

Section
13. Taxes.

 

(a)
Withholding. The Company may withhold and deduct from any payments made under this Agreement all applicable taxes, including but
not limited to income, employment, and social security taxes, as shall be required by applicable law. Employee acknowledges and represents
that the Company has not provided any tax advice to Employee in connection with this Agreement and that Employee has been advised by
the Company to seek tax advice from Employee’s own tax advisors regarding this Agreement and payments that may be made, and the
benefits to be provided, to Employee pursuant to this Agreement, including specifically, the application of the provisions of Section
409A of the Code to such payments.

 

(b)
Section 409A – General. This Agreement shall be interpreted and administered in a manner so that any amount or benefit payable
hereunder shall be paid or provided in a manner that is either exempt from or compliant with the requirements Section 409A of the Code
and applicable Internal Revenue Service guidance and Treasury Regulations issued thereunder.

 

(c)
Definitional Restrictions. Notwithstanding anything in this Agreement to the contrary, no payment that is due upon Employee’s
termination of employment shall be made unless and until Employee has incurred a “separation from service,” as defined under
Treas. Reg. §1.409A-1(h).

 

(d)
Six-Month Delay in Certain Circumstances. Notwithstanding any other provision of this Agreement, if Employee is a Specified Employee
(as defined below) at the time of termination of employment, then, to the extent that payments and benefits under this Agreement constitute
“deferred compensation” under Section 409A of the Code and are not eligible for any exemption thereunder (“Non-Exempt
Deferred Compensation”), and payment of cash or provision of his benefits is pursuant to a termination of employment, then:

 

    	 

     

    

 

(i)
the amount of such Non-Exempt Deferred Compensation that would otherwise be payable during the six-month period immediately following
Employee’s separation from service will be accumulated through and paid or provided on the first day of the seventh month following
Employee’s separation from service (or, if Employee dies during such period, within 30 days after Employee’s death) (in either
case, the “Required Delay Period”); and

 

(ii)
the normal payment or distribution schedule for any remaining payments or distributions will resume at the end of the Required Delay
Period.

 

For
purposes of this Agreement, the term “Specified Employee” has the meaning given such term in Treas. Reg. §1.409A-1(i).

 

(e)
Treatment of Installment Payments. Each payment of termination benefits under Section 8 of this Agreement shall be considered
a separate payment, as described in Treas. Reg. §1.409A-2(b)(2), for purposes of Section 409A of the Code.

 

(f)
Timing of Reimbursements and In-kind Benefits. If Employee is entitled to be paid or reimbursed for any taxable expenses under
Section 7, and such payments or reimbursements are includible in Employee’s federal gross taxable income, the amount of such expenses
reimbursable in any one calendar year shall not affect the amount reimbursable in any other calendar year, the reimbursement of an eligible
expense must be made no later than December 31 of the year after the year in which the expense was incurred, and the right of Employee
to reimbursement of such expenses shall not be subject to exchange or liquidation for any other benefit or payment.

 

(g)
Permitted Acceleration. The Company shall have the sole authority to make any accelerated distribution permissible under Treas.
Reg. Section 1.409A-3(j)(4) to Employee of deferred amounts, provided that such distribution meets the requirements of Treas. Reg. §1.409A-3(j)(4).

 

Section
14. Set Off; Mitigation. The Company’s obligation to pay Employee the amounts provided and to make the arrangements provided
hereunder shall be subject to set-off, counterclaim, or recoupment of amounts owed by Employee to the Company or its Affiliates, provided
that such amounts owed have been acknowledged by Employee in writing. To the extent any amount so subject to set-off, counterclaim, or
recoupment is payable in installments hereunder, such set-off, counterclaim, or recoupment shall not modify the applicable payment date
of any installment, and to the extent an obligation cannot be satisfied by reduction of a single installment payment, any portion not
satisfied shall remain an outstanding obligation of Employee and shall be applied to the next installment only at such time the installment
is otherwise payable pursuant to the specified payment schedule.

 

Section
15. Successors and Assigns; No Third-Party Beneficiaries.

 

(a)
The Company. This Agreement shall inure to the benefit of the Company and its respective successors and assigns. In the event
of change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company,
this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor, and such successor
shall discharge and perform all the promises, covenants, duties, and obligations of the Company hereunder.

 

(b)
Employee. Employee’s rights and obligations under this Agreement shall not be transferable by Employee by assignment or
otherwise, without the prior written consent of the Company; provided, however, that if Employee shall die, all amounts
then payable to Employee hereunder shall be paid in accordance with the terms of this Agreement to Employee’s devisee, legatee,
or other designee, or if there be no such designee, to Employee’s estate.

 

(c)
No Third-Party Beneficiaries. Except as otherwise set forth in Section 16(a) or Section 16(b) hereof, nothing expressed or referred
to in this Agreement will be construed to give any Person other than the Company, the other members of the Company Group, and Employee
any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement.

 

    	 

     

    

 

(d)
Enforcement. Because Employee’s services are unique and because Employee has access to Confidential Information and Work
Product, the parties hereto agree that money damages would be an inadequate remedy for any breach of Sections 10, 11 and 12 of this Agreement.
Therefore, in the event of a breach or threatened breach of Sections 10, 11 and 12 of this Agreement, all parties hereto and their respective
successors or assigns will be entitled to injunctive relief, in addition to other rights and remedies existing in their favor at law
or in equity in order to enforce, or prevent any violations of, the provisions hereof without posting a bond or other security.

 

Section
16. Waiver and Amendments. Any waiver, alteration, amendment, or modification of any of the terms of this Agreement shall be valid
only if made in writing and signed by each of the parties hereto. No waiver by either of the parties hereto of their rights hereunder
shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically
states that it is to be construed as a continuing waiver.

 

Section
17. Severability. If any covenants or such other provisions of this Agreement are found to be invalid or unenforceable by a final
determination of a court of competent jurisdiction, (a) the remaining terms and provisions hereof shall be unimpaired, and (b) the invalid
or unenforceable term or provision hereof shall be deemed replaced by a term or provision that is valid and enforceable and that comes
closest to expressing the intention of the invalid or unenforceable term or provision hereof.

 

Section
18. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, without
regard to its conflicts of law or choice of law provisions which would result in the application of the law of any other jurisdiction.

 

Section
19. Arbitration. Any controversy or claim arising out of or relating to this Agreement or any transactions provided for herein,
or the breach thereof, other than a claim for injunctive relief for a breach of Sections 10, 11 and 12, will be settled by arbitration
in accordance with the commercial Arbitration Rules of the American Arbitration Association (the “Rules”) in effect at the
time demand for arbitration is made by any party. The evidentiary and procedural rules in such proceedings will be kept to the minimum
level of formality that is consistent with the Rules. The Company and Employee shall agree on a sole arbitrator of the controversy or
claim. The arbitrator must be experienced in the matters in dispute. If the sole arbitrator cannot be agreed upon by the Company and
the Employee within 10 business days, either the Company or Employee may request the American Arbitration Association to name a sole
arbitrator. Arbitration will occur in Houston, TX, or such other location agreed to by the Company and the Employee. The award made by
the arbitrator will be final and binding, and judgment may be entered in any court of law having competent jurisdiction. The award is
subject to confirmation, modification, correction or vacation only as explicitly provided in Title 9 of the United States Code. The prevailing
party will be entitled to an award of pre- and post-award interest as well as reasonable attorneys’ fees incurred in connection
with the arbitration and any judicial proceedings related thereto and any costs incurred paying the fees or expenses of the arbitrator.

 

Section
20. Notices.

 

(a)
Every notice or other communication relating to this Agreement shall be in writing, and shall be mailed to or delivered to the party
for whom or which it is intended at such address as may from time to time be designated by it in a notice mailed or delivered to the
other party as herein provided; provided, that unless and until some other address be so designated, all notices and communications
by Employee to the Company shall be mailed or delivered to the Company at its principal executive office at 675 Bering Drive, Houston,
Texas 77057, and all notices and communications by the Company to Employee may be given to Employee personally or may be mailed to Employee
at Employee’s last known address, as reflected in the Company’s records.

 

(b)
Any notice so addressed shall be deemed to be given (i) if delivered by hand, on the date of such delivery, (ii) if mailed by courier
or by overnight mail, on the first business day following the date of such mailing, and (iii) if mailed by registered or certified mail,
on the third business day after the date of such mailing.

 

    	 

     

    

 

Section
21. Section Headings; Mutual Drafting.

 

(a)
The headings of the sections and subsections of this Agreement are inserted for convenience only and shall not be deemed to constitute
a part thereof or affect the meaning or interpretation of this Agreement or of any term or provision hereof.

 

(b)
The parties are sophisticated and have been represented (or have had the opportunity to be represented) by their separate attorneys throughout
the transactions contemplated by this Agreement in connection with the negotiation and drafting of this Agreement and any agreements
and instruments executed in connection herewith. As a consequence, the parties do not intend that the presumptions of laws or rules relating
to the interpretation of contracts against the drafter of any particular clause should be applied to this Agreement or any document or
instrument executed in connection herewith, and therefore waive their effects.

 

Section
22. Entire Agreement. This Agreement, together with any exhibits attached hereto, constitutes the entire understanding and agreement
of the parties hereto regarding the employment of Employee. This Agreement supersedes all prior negotiations, discussions, correspondence,
communications, understandings, and agreements between the parties relating to the subject matter of this Agreement. This agreement specifically
supersedes and cancels the previous Employment Agreement dated March 5, 2020.

 

Section
23. Dodd-Frank Act and Other Applicable Law Requirements. Employee agrees (i) to abide by any compensation recovery, recoupment,
anti-hedging or other policy applicable to executives of the Company and its Affiliates, as may be in effect from time to time, as approved
by the Board or a duly authorized committee thereof or as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010 (“Dodd-Frank Act”) or other applicable law, and (ii) that the terms and conditions of this Agreement shall be deemed
automatically amended as may be necessary from time to time to ensure compliance by Employee and this Agreement with such policies, the
Dodd-Frank Act, or other applicable law.

 

Section
24. Survival of Operative Sections. Upon any termination of Employee’s employment, the provisions of this Agreement (together
with any related definitions set forth in Section 1 hereof) shall survive to the extent necessary to give effect to the provisions thereof,
including but not limited to Sections 10, 11 and 12.

 

Section
25. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original
but all of which together shall constitute one and the same instrument. The execution of this Agreement may be by actual or facsimile
signature.

 

    	 

     

    

 

IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.

 

	 	COMPANY:
    
	 	 	 
	 	U.S.
    ENERGY CORP.
	 	 	 
	 	By:
    	/s/
    John Weinzierl
	 	Name:
    	John
    A. Weinzierl
	 	Title:	Chairman
    of the Board
	 	Date:	May
    5, 2022
	 	 	 
	 	EMPLOYEE:
	 	 	 
	 	By:	/s/ Ryan
    Smith
	 	Name:	Ryan
    Smith
	 	Date:	May
    5, 2022

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