Document:

Exhibit 10.3

EV MANAGEMENT, LLC

 

2017-2018 KEY EMPLOYEE INCENTIVE PLAN

 

1.          Purpose.
This EV Management, LLC (the “Company”) 2017-2018 Key Employee Incentive Plan (the “Plan”)
is designed to align the interests of the Company and eligible key employees of the Company and its Affiliates.

 

2.          Adoption
of the Plan. The Company, intending to be legally
bound, hereby adopts the Plan effective as of November 17, 2017 (the “Effective Date”).
The Plan shall be in effect from the Effective Date and shall continue until September 30, 2018, unless earlier terminated by
the Company in accordance with Section 8(e) (the “Term”). The expiration or termination of the
Term shall not in any event reduce or adversely affect any amounts due to any Participant hereunder for any Performance Period
(as defined herein) ending on or before such date.

 

3.           General.
The compensation provided under the Plan is intended to be in addition to all other compensation payable to Participants under
any employment agreement or incentive plan or program in effect with the Company or its direct or indirect Affiliates.

 

4.           Definitions.
For purposes of this Plan:

 

(a)          “Affiliates”
means EV Energy Partners, L.P., or any entity, in whatever form, of which the Company or EV Energy Partners, L.P., has ownership
or management control, as determined by the Committee (as defined herein).

 

(b)          “Board”
means the Company’s Board of Directors.

 

(c)          “Cause”
means Participant (i) has been convicted of, or pleaded no contest to, a misdemeanor involving moral turpitude, or a felony, (ii)
engaged in misconduct which is materially injurious to the Company or its Affiliates (including, without limitation, misuse of
any funds or other property), (iii) engaged in gross negligence or willful misconduct in the performance of Participant’s
duties for the Company, (iv) willfully refused, without proper legal reason, to perform Participant’s duties for the Company,
(v) materially breached of Participant’s duties and responsibilities, which is not remedied promptly after the Company gives
Participant written notice specifying such breach, (vi) committed, or engaged in, any act of fraud, embezzlement, theft, a material
breach of trust, or any material act of dishonesty, in each case, involving the Company or its Affiliates, or (iv) committed, or
engaged in, any significant violation of the code of conduct of the Company or its Affiliates, or of any statutory or common law
duty of loyalty to the Company or its Affiliates. For purposes of this definition, no act or failure to act will be deemed “willful,”
unless effected by the Participant not in good faith and without a reasonable belief that his action or failure to act was in or
not opposed to the best interests of the Company or any of its Affiliates.

 

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

 

(e)          “Company
Group” means the Company and its direct and indirect Affiliates.

 

    	 	 	 

     

    

 

(f)           “Disability”
means Participant’s inability, due to physical or mental incapacity, to perform the essential functions of Participant’s
job, for two hundred seventy (270) consecutive days.

 

(g)          “Good
Reason” means any of the following, in each case, without Participant’s consent and as compared to what was
in effect as of the Effective Date: (i) a material breach by the Company of any material provision of any material written agreement
between Participant and the Company, (ii) any material reduction in Participant’s base salary or target annual bonus amount,
(iii) any material diminution in Participant’s authority, duties, or responsibilities, or (iv) a material and involuntary
change in geographic location from the Company’s offices at which Participant is principally employed to a location more
than fifty (50) miles from such offices immediately prior to the relocation (except for required travel on the Company’s
business to an extent substantially consistent with Participant’s business travel obligations). Notwithstanding the foregoing,
the occurrence of an event that would otherwise constitute Good Reason will cease to be an event constituting Good Reason upon
any of the following: (x) Participant’s failure to provide written notice to the Company within thirty (30) days of the date
the Participant has actual knowledge of the facts or circumstances giving rise thereto, (y) substantial correction of such occurrence
by the Company within thirty (30) days following receipt of Participant’s written notice described in (x), or (z) Participant’s
failure to actually terminate employment within the ten (10) day period following the expiration of the Company’s thirty
(30) day cure period.

 

(h)          “First
Performance Period” means the period commencing October 1, 2017 and ending December 31, 2017.

 

(i)           “Fourth
Performance Period” means the period commencing July 1, 2018 and ending September 30, 2018.

 

(j)           “Participant”
shall have the meaning ascribed thereto in Section 5 hereof.

 

(k)          “Participation
Agreement” means the agreement between the Company and a Participant granting Participant the opportunity to earn
a Quarterly Performance Incentive under this Plan and in the form attached hereto as Exhibit B.

 

(l)           “Performance
Goals” means the Performance Metrics (as defined below) for each Performance Period as set forth on Exhibit A
as follows: the (i) Quarterly Threshold Performance Goals, (ii) Quarterly Target Performance Goals, and (iii) Quarterly Maximum
Performance Goals, collectively, the “Quarterly Performance Goals”; and for the purposes of catch-up
payments described in Section 6(b): the (i) Cumulative Threshold Performance Goals; (ii) Cumulative Target Performance
Goals; and (iii) Cumulative Maximum Performance Goals, collectively, the “Cumulative Performance Goals”
of applicable Performance Metrics.

 

(m)         “Performance
Metric” means the specific performance criteria used in determining Performance Goals for the Performance Period
as set forth in Exhibit A; provided that each Performance Metric shall be adjusted on a pro forma basis to take into
account any acquisitions or dispositions consummated during the Performance Period. The Performance Metric shall be adjusted on
a pro forma basis to exclude costs and benefits associated with the Company’s restructuring.

 

    	 	2	 

     

    

 

(n)          “Performance
Period” means each successive calendar quarter commencing during the Term.

 

(o)          “Qualifying
Termination” means the termination of Participant’s employment (i) by the Company for a reason other than Cause,
(ii) by Participant for Good Reason, or (iii) due to Participant’s death or Disability.

 

(p)          “Quarterly
Performance Incentive” shall mean, in the case of any Participant, the incentive payable to such Participant under
the Plan for the applicable Performance Period.

 

(q)          “Second
Performance Period” means the period commencing January 1, 2018 and ending March 31, 2018.

 

(r)           “Section
409A” means Section 409A of the Internal Revenue Code of 1986, as amended.

 

(s)          “Third
Performance Period” means the period commencing April 1, 2018 and ending June 30, 2018.

 

5.           Eligible
Participants. Each person designated by the Committee from time to time shall be a Participant under the Plan and eligible
to receive a Quarterly Performance Incentive with respect to each Performance Period.

 

6.           Term
of Participation.

 

(a)          Subject
to the provisions of this Plan and any Participation Agreement granted hereunder, each Participant shall earn a Quarterly Performance
Incentive as of the end of each Performance Period, depending upon the extent to which the Performance Goals set forth in Exhibit
A have been achieved for such Performance Period.

 

(b)          In
addition to being measured on a quarterly basis, each Performance Metric shall be measured cumulatively as of the end of each of
the Second Performance Period, Third Performance Period, and Fourth Performance Period. A “catch-up” payment will be
made to the extent the Company equals or exceeds the Cumulative Performance Goals/Metrics for the applicable Performance Period
as follows:

 

(i)          Second
Performance Period Catch-Up: A Participant shall earn an amount equal to the excess, if any, of (i) the aggregate Quarterly
Performance Incentive payable based on achievement, as applicable, of the Cumulative Performance Goals as of the end of the Second
Performance Period over (ii) the sum of the Quarterly Performance Incentives actually paid for the First and Second Performance
Periods. The Second Performance Period Catch-Up, if any, shall be payable in addition to any Quarterly Performance Incentive earned
for the Second Performance Period pursuant to Section 6(a) above.

 

(ii)         Third
Performance Period Catch-Up: A Participant shall earn an amount equal to the excess, if any, of (i) the aggregate Quarterly
Performance Incentive payable based on achievement, as applicable, of the Cumulative Performance Goals as of the end of the Third
Performance Period over (ii) the sum of the Quarterly Performance Incentives actually paid for the First, Second, and Third Performance
Periods. The Third Performance Period Catch-Up, if any, shall be payable in addition to any Quarterly Performance Incentive earned
for the Third Performance Period pursuant to Section 6(a) above.

 

    	 	3	 

     

    

 

(iii)        Fourth
Performance Period Catch-Up: A Participant shall earn an amount equal to the excess, if any, of (i) the aggregate Quarterly
Performance Incentive payable based on achievement, as applicable, of the Cumulative Performance Goals as of the end of the Fourth
Performance Period over (ii) the sum of the Quarterly Performance Incentives actually paid for the First, Second, Third, and Fourth
Performance Periods. The Fourth Performance Period Catch-Up, if any, shall be payable in addition to any Quarterly Performance
Incentive earned for the Fourth Performance Period pursuant to Section 6(a) above.

 

(c)         Participant
shall not be eligible to earn a Quarterly Performance Incentive with respect to any calendar quarter that commences following the
end of the Term.

 

(d)         Exhibit
A sets forth for each Performance Period, as applicable: (i) the Quarterly Threshold Performance Goals, Quarterly Target Performance
Goals, and Quarterly Maximum Performance Goals; and (ii) the Cumulative Threshold Performance Goals, Cumulative Target Performance
Goals, and Cumulative Maximum Performance Goals. Exhibit A also sets forth the payout schedule setting forth the Quarterly
Performance Incentive amount potentially payable upon the achievement of the applicable Performance Goals. The payout schedule
for a Quarterly Performance Incentive for a Participant shall be based on Participant’s individual target payment amount
that has been approved by the Committee and the level of achievement of the applicable Performance Metrics. Participant’s
individual target payment shall be set forth in such Participant’s Participation Agreement. Achievement of the Performance
Goals shall be calculated on the basis of straight-line interpolation between the normal and cumulative Quarterly Threshold Performance
Goals, Quarterly Target Performance Goals, and Quarterly Maximum Performance Goals for each Performance Metric underlying the Performance
Goal. Except as otherwise may be provided by the Committee, in its sole discretion, no Quarterly Performance Incentive shall be
payable for a Performance Metric unless the Quarterly Threshold Performance Goals for such Performance Metric are achieved.

 

(e)         Except
as set forth in this Section 6(e), in order to earn a Quarterly Performance Incentive for any Performance Period, a Participant
must remain employed by the Company Group through the date on which the Quarterly Performance Incentive for the applicable Performance
Period is paid. Except as set forth in this Section 6(e), a Participant whose employment with the Company Group terminates
for any reason prior to the date on which the Quarterly Performance Incentive for the applicable Performance Period is paid shall
forfeit the right to any Quarterly Performance Incentive for that Performance Period. Notwithstanding the foregoing, in the event
of Participant’s Qualifying Termination during a Performance Period, Participant shall be entitled to a pro rata portion
(based on the percentage of the Performance Period Participant was engaged by the Company Group) of the Quarterly Performance Incentive
that would otherwise have been earned for such Performance Period.

 

7.           Performance
Certification. Promptly after the end of each Performance Period and as soon as quarterly financials are estimable, the Committee
shall certify the degree to which the applicable Performance Goals have been achieved and the amount of Quarterly Payment Incentive
payable to each Participant hereunder. Any Quarterly Performance Incentive required to be made under this Plan shall be paid on
a fully-vested basis by the Company as soon as possible after the end of the applicable Performance Period, but in any event not
less than forty-five (45) days after the end of the Performance Period.

 

    	 	4	 

     

    

 

8.           Plan
Administration. This Plan shall be administered by the Committee. The Committee is given full authority and discretion within
the limits of this Plan to establish such administrative measures as may be necessary to administer and attain the objectives
of this Plan and may delegate the authority to administer the Plan to an officer of the Company. The Committee (or its delegate,
as applicable) shall have full power and authority to construe and interpret this Plan, and any interpretation by the Committee
shall be binding on all Participants and shall be accorded the maximum deference permitted by law.

 

(a)         All
rights and interests of Participants under this Plan shall be non-assignable, and nontransferable, and otherwise not subject to
pledge or encumbrance, whether voluntary or involuntary, other than by will or by the laws of descent and distribution. In the
event of any sale, transfer, or other disposition of all or substantially all of the Company’s assets or business, whether
by merger, stock sale, consolidation, or otherwise, the Company may assign this Plan.

 

(b)         Any
payment to a Participant in accordance with the provisions of this Plan shall, to the extent thereof, be in full satisfaction of
all claims against the Company Group related to this Plan, and the Company may require Participant, as a condition precedent to
such payment, to execute a receipt and release to such effect.

 

(c)         Payment
of amounts due under the Plan shall be provided to Participant in the same manner as Participant receives his or her regular paycheck
or by mail at the last known address of Participant in the possession of the Company, at the discretion of Committee. The Company
may deduct all applicable taxes and any other withholdings required to be withheld with respect to the payment of any award pursuant
to this Plan.

 

(d)         The
Company shall not be required to establish any special or separate fund or to make any other segregation of assets to ensure the
payment of any award provided for hereunder. Quarterly Performance Incentive payments shall not be considered as extraordinary,
special incentive compensation, and it will not be included as “earnings,” “wages,” “salary,”
or “compensation” in any pension, welfare, life insurance, or other employee benefit plan or arrangement of the Company
Group.

 

(e)         The
Company, in its sole discretion, shall have the right to modify, supplement, suspend, or terminate this Plan at any time; provided
that, except as required by law, in no event shall any amendment or termination adversely affect the rights of Participants regarding
any Quarterly Performance Incentive for a Performance Period that has commenced as of the date of such action without the prior
written consent of the affected Participants. Subject to the foregoing, the Plan shall terminate upon the satisfaction of all obligations
of the Company or its successor entities hereunder.

 

(f)          Nothing
contained in this Plan shall in any way affect the right and power of the Company to discharge any Participant or otherwise terminate
his or her employment at any time or for any reason or to change the terms of his or her employment in any manner.

 

    	 	5	 

     

    

 

(g)         Except
as otherwise provided under this Plan, any expense incurred in administering this Plan shall be borne by the Company.

 

(h)         Captions
preceding the sections hereof are inserted solely as a matter of convenience and in no way define or limit the scope or intent
of any provision hereof.

 

(i)          The
administration of the Plan shall be governed by the laws of Texas, without regard to the conflict of law principles of any state.
Any persons or corporations who now are or shall subsequently become parties to the Plan shall be deemed to consent to this provision.

 

(j)          The
Plan is intended to either comply with, or be exempt from, the requirements of Section 409A. To the extent that the Plan is not
exempt from the requirements of Code Section 409A, the Plan is intended to comply with the requirements of Code Section 409A and
shall be limited, construed, and interpreted in accordance with such intent. Notwithstanding the foregoing, in no event whatsoever
shall the Company be liable for any additional tax, interest, income inclusion, or other penalty that may be imposed on a Participant
by Code Section 409A or for damages for failing to comply with Code Section 409A.

 

* * * * * * * *

 

    	 	6	 

     

    

 

IN WITNESS WHEREOF, EV Management, LLC has caused
the Plan to be signed by its duly authorized officer as of the date first set forth above.

 

	 	EV MANAGEMENT, LLC
	 	 	 
	 	By:	/s/ John B. Walker
	 	 	 
	 	Name:	John B. Walker
	 	 	 
	 	Its:	Executive Chairman

 

    	 	 	 

     

    

 

Exhibit A

 

Performance Metrics and Goals

 

	Payable if Quarterly Threshold Performance Metric Achieved:	 	50% of Applicable Portion of Target Quarterly

                                                                 Performance Incentive

	 	 	 
	Payable if Quarterly Target Performance Metric Achieved: 	 	100% of Applicable Portion of Target Quarterly

                                                     Performance Incentive

	 	 	 
	Payable if Cumulative Maximum Performance Metric Achieved:	 	150% of Applicable Portion of Target Quarterly

                                                     Performance Incentive

	 	 	 
	Payable if Cumulative Quarterly Threshold Performance Metric Achieved:	 	50% of Aggregate Applicable Portion of Target Quarterly Performance Incentive Through the Applicable

                                                     Performance Period

	 	 	 
	Payable if Cumulative Quarterly Target Performance Metric Achieved:	 	100% of Aggregate Applicable Portion of Target Quarterly Performance Incentive Through the Applicable

                                                     Performance Period

	 	 	 
	Payable if Cumulative Quarterly Maximum Performance Metric Achieved:	 	150% of Applicable Portion of Aggregate Target Quarterly Performance Incentive Through the Applicable

                                                     Performance Period

	 	 	 
	Portion of Applicable Portion Payable if Achievement is Between Quarterly and/or Cumulative Threshold and Maximum Performance Metric:	 	Calculated on the basis of straight-line interpolation

 

	(i)	Performance Metric:	Production (mmcfe/day)

 

	 	Applicable Portion of Target Quarterly Performance Incentive:	33.33%

 

	Performance
 Period
	 	First 
 Performance 
 Period
	 	 	Second 
 Performance 
 Period
	 	 	Third 
 Performance 
 Period
	 	 	Fourth
 Performance 
 Period
	 
	Quarterly Threshold Performance Goal	 	 	165.0	 	 	 	162.5	 	 	 	162.5	 	 	 	162.5	 
	Quarterly Target Performance Goal	 	 	173.7	 	 	 	171.0	 	 	 	171.0	 	 	 	171.0	 
	Quarterly Maximum Performance Goal	 	 	182.4	 	 	 	179.6	 	 	 	179.6	 	 	 	179.6	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cumulative Threshold Performance Goal	 	 	N/A	 	 	 	163.7	 	 	 	163.3	 	 	 	163.1	 
	Cumulative Target Performance Goal	 	 	N/A	 	 	 	172.4	 	 	 	171.9	 	 	 	171.7	 
	Cumulative Maximum Performance Goal	 	 	N/A	 	 	 	181.0	 	 	 	180.5	 	 	 	180.3	 

 

    	 	 	 

     

    

 

 

	(ii)	Performance Metric:	Lease Operating Expense ($mm)

 

	 	Applicable Portion of Target Quarterly Performance Incentive:	33.33%

 

	Performance
 Period
	 	First 
 Performance 
 Period
	 	 	Second 
 Performance 
 Period
	 	 	Third
 Performance 
 Period
	 	 	Fourth
 Performance
 Period
	 
	Quarterly Threshold Performance Goal	 	 	27.9	 	 	 	27.9	 	 	 	27.9	 	 	 	27.9	 
	Quarterly Target Performance Goal	 	 	26.6	 	 	 	26.6	 	 	 	26.6	 	 	 	26.6	 
	Quarterly Maximum Performance Goal	 	 	25.3	 	 	 	25.3	 	 	 	25.3	 	 	 	25.3	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cumulative Threshold Performance Goal	 	 	N/A	 	 	 	55.8	 	 	 	83.7	 	 	 	111.6	 
	Cumulative Target Performance Goal	 	 	N/A	 	 	 	53.2	 	 	 	79.8	 	 	 	106.4	 
	Cumulative Maximum Performance Goal	 	 	N/A	 	 	 	50.6	 	 	 	75.9	 	 	 	101.2	 

 

	(iii)	Performance Metric:	Adjusted EBITDAX ($mm)

 

	 	Applicable Portion of Target Quarterly Performance Incentive:	33.34%

 

	Performance
 Period
	 	First 
 Performance 
 Period
	 	 	Second 
 Performance 
 Period
	 	 	Third
 Performance 
 Period
	 	 	Fourth
 Performance
 Period
	 
	Quarterly Threshold Performance Goal	 	 	17.7	 	 	 	20.2	 	 	 	17.3	 	 	 	17.8	 
	Quarterly Target Performance Goal	 	 	20.8	 	 	 	23.8	 	 	 	20.4	 	 	 	20.9	 
	Quarterly Maximum Performance Goal	 	 	23.9	 	 	 	27.4	 	 	 	23.5	 	 	 	24.0	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cumulative Threshold Performance Goal	 	 	N/A	 	 	 	37.9	 	 	 	55.2	 	 	 	73.0	 
	Cumulative Target Performance Goal	 	 	N/A	 	 	 	44.6	 	 	 	65.0	 	 	 	85.9	 
	Cumulative Maximum Performance Goal	 	 	N/A	 	 	 	51.3	 	 	 	74.8	 	 	 	98.8	 

 

Definitions:

 

For purposes herein:

 

		a.	Adjusted “EBITDAX” is a non-GAAP financial measure as defined in EV Energy
Partners, L.P.’s quarterly earnings releases and determined in a manner consistent with past reporting practices to the Board,
excluding fees and expenses related to or incurred on account of analyzing, structuring, negotiating, or effecting the restructuring
of the Company’s liabilities (including, without limitation, fees and expenses of legal and financial advisors).

 

    	 	 	 

     

    

 

		b.	“Lease Operating Expense” means lease operating expenses as presented
in, or calculated in the same manner as presented in, the EV Energy Partners, L.P. quarterly unaudited and annual audited financial
statements prepared in accordance with generally accepted accounting principles, plus or minus any non-cash inventory adjustments
contained therein.

 

		c.	“mmcfe” means one million cubic feet of natural gas equivalent, determined
using the ratio of six thousand (6,000) cubic feet of natural gas to one barrel of crude oil, condensate, or natural gas liquids.

 

		d.	“Production” means the production of oil, natural gas, and natural gas
liquids as presented in, or calculated in the same manner as presented in, the EV Energy Partners, L.P. quarterly unaudited and
annual audited financial statements prepared in accordance with generally accepted accounting principles.

 

    	 	 	 

     

    

 

EXHIBIT B

 

	TO:	______________
	 	 
	FROM:	______________
	 	 
	DATE:	______________, 2017

 

		RE:	Participation Agreement under the EV Management, LLC 2017-2018 Key Employee Incentive Plan

 

We
are pleased to advise you that you will be eligible to receive Quarterly Performance Incentive payments for the Performance Periods
pursuant to the EV Management, LLC (the “Company”) 2017-2018 Key Employee Incentive Plan (the
“KEIP”). Terms used herein with initial capital letters have the meanings set forth in the KEIP, and
this letter and the respective rights and obligations of you and the Company shall be, in all respects, subject to the terms and
conditions of the KEIP. A copy of the KEIP is attached for your reference.

 

		1.	Performance Period. This Participation Agreement relates to the Performance Period beginning
October 1, 2017 through December 31, 2017 and continuing for successive quarters pursuant to the terms of the KEIP.

 

		2.	Total Threshold Amount; Total Target Amount; Total Maximum Amount. Your quarterly threshold
amount is $______, your quarterly target amount is $______, and your quarterly maximum amount is $______.

 

		3.	Performance Metrics. You will be eligible to earn the applicable portion of your Quarterly
Performance Incentive based on the Company’s performance against the following Performance Metrics:

 

	Performance Metric	 	Applicable Portion of 
 Quarterly 
 Performance Incentive
	 	 	Quarterly Incentive Opportunity
	 	 	 	 	 	 
	Production	 	 	33.33%	 	 	·      Threshold: $_________________

                                              
 ·      Target: $____________________

                                                                                                                                                         
 ·      Maximum: $_________________

	 	 	 	 	 	 	 
	Lease Operating Expense	 	 	33.33%	 	 	·      Threshold: $_________________

                                  
 ·      Target: $____________________

                                                                                                                                             
 ·      Maximum: $_________________

	 	 	 	 	 	 	 
	Adjusted EBITDAX	 	 	33.34%	 	 	·      Threshold: $_________________

                                  
 ·      Target: $____________________

                                                                                                                                             
 ·      Maximum: $_________________

 

    	 	 	 

     

    

 

		4.	Payment Schedule. Your Quarterly Performance Incentive amount, if any, will be paid to you
as soon as practicable after the end of each Performance Period, but in no event shall payment be made later than as required by
Section 409A.

 

		5.	Cumulative Payment. Commencing with the Second Performance Period, you will be eligible
to receive a cumulative Quarterly Performance Incentive at the end of each Performance Period based on the degree to which the
applicable cumulative Performance Metrics are achieved as of the end of that Performance Period.

 

Your eligibility for Quarterly Performance
Incentive payments shall have no effect on your ability to participate in other benefits programs of the Company, including other
incentive or benefit plans, subject to the terms and conditions of those programs, and does not affect the nature of your employment
with the Company. Your rights under this letter and any interest in or right to the Award may not be transferred or assigned by
you, other than by will or by the laws of descent and distribution.

 

The Company intends for the Quarterly Performance
Incentive payments to be exempt from the requirements of Section 409A and the regulations and other guidance issued thereunder,
and this letter shall be interpreted to give effect to such intention; provided, however, that nothing contained
herein shall be construed as a representation, guarantee, or other undertaking on the part of the Company that the Award is or
will be found to be exempt from Section 409A. You are hereby advised to consult immediately with your tax advisor regarding the
tax consequences of the Quarterly Incentive Performance payments, including, without limitation, any possible tax consequences
of the Quarterly Incentive Performance payments in connection with Section 409A.

 

We greatly appreciate your contributions to
the Company and look forward to working together with you towards the Company’s future successes. If you have any questions
regarding this Participation Agreement, please contact Ann Archer in Human Resources at 713-970-1923.

 

IN WITNESS WHEREOF, Participant
has entered into this Participation Agreement, and EV Management, LLC has caused this Participation Agreement to be executed in
its name and on its behalf by its duly authorized officer as of the date first set forth above.

 

	PARTICIPANT
	 	EV MANAGEMENT, LLC
	 	 	 	 
	 	 	By: 	 
	Participant’s Signature	 	 	 
		 	Name: 	 
	 	 	 	 
	 	 	Its:Exhibit 10.4

 

EV MANAGEMENT, LLC

 

RETENTION BONUS AGREEMENT

 

Personal and Confidential

 

November 17, 2017

 

		Re:	Retention Bonus Agreement

 

Dear Michael E. Mercer:

 

On behalf of EV Management,
LLC (the “Company”), I am pleased to offer you the opportunity to receive a retention bonus, if you agree
to the terms and conditions contained in this letter agreement (this “Agreement”), which shall be effective
as of the date you execute and return a copy of this Agreement (such date, the “Effective Date”).

 

1.          Retention
Bonus. Subject to the terms and conditions set forth herein, you (the “Participant”) will receive
a cash lump sum payment in the amount of $550,000 (the “Retention Bonus”) within fifteen (15) days of
the Effective Date. Participant agrees that in the event Participant’s employment with the Company terminates for any reason
other than a Qualifying Termination (as defined herein) before December 31, 2018 (the “Completion Date”),
Participant will be required to repay to the Company within fifteen (15) days of such termination 100% of the After-Tax Value of
the Retention Bonus (as defined herein). Notwithstanding anything to the contrary contained herein, in the event of Participant’s
Qualifying Termination before the Completion Date and if Participant executes and does not revoke a customary release of claims
in a form reasonably satisfactory to the Company, Participant will not be required to repay any portion of the Retention Bonus.

 

2.          Definitions.
For purposes of this Agreement:

 

“Affiliate”
means EV Energy Partners, L.P., or any entity, in whatever form, of which the Company or EV Energy Partners, L.P., has ownership
or management control, as determined by the Compensation Committee of the Board of Directors of the Company.

 

“After-Tax
Value of the Retention Bonus” means the aggregate amount of the Retention Bonus net of any taxes Participant is required
to pay in respect thereof and determined by taking into account any tax benefit that may be available in respect of such repayment.
The Company shall determine in good faith the After-Tax Value of the Retention Bonus, which determination shall be conclusive and
binding.

 

    	 	1	 

     

    

 

“Cause”
means Participant (i) has been convicted of, or pleaded no contest to, a misdemeanor involving moral turpitude, or a felony, (ii)
engaged in misconduct which is materially injurious to the Company or its Affiliates (including, without limitation, misuse of
any funds or other property), (iii) engaged in gross negligence or willful misconduct in the performance of Participant’s
duties for the Company, (iv) willfully refused, without proper legal reason, to perform Participant’s duties for the Company,
(v) materially breached of Participant’s duties and responsibilities, which is not remedied promptly after the Company gives
Participant written notice specifying such breach, (vi) committed, or engaged in, any act of fraud, embezzlement, theft, a material
breach of trust, or any material act of dishonesty, in each case, involving the Company or its Affiliates, or (iv) committed, or
engaged in, any significant violation of the code of conduct of the Company or its Affiliates, or of any statutory or common law
duty of loyalty to the Company or its Affiliates. For purposes of this definition, no act or failure to act will be deemed “willful,”
unless effected by the Participant not in good faith and without a reasonable belief that his action or failure to act was in or
not opposed to the best interests of the Company or any of its Affiliates.

 

“Disability”
means Participant’s inability, due to physical or mental incapacity, to perform the essential functions of Participant’s
job, for two hundred seventy (270) consecutive days.

 

“Good Reason”
means any of the following, in each case, without Participant’s consent and as compared to what was in effect as of the Effective
Date: (i) a material breach by the Company of any material provision of any material written agreement between Participant and
the Company, (ii) any material reduction in Participant’s base salary or target annual bonus amount, (iii) any material diminution
in Participant’s authority, duties, or responsibilities, or (iv) a material and involuntary change in geographic location
from the Company’s offices at which Participant is principally employed to a location more than fifty (50) miles from such
offices immediately prior to the relocation (except for required travel on the Company’s business to an extent substantially
consistent with Participant’s business travel obligations). Notwithstanding the foregoing, the occurrence of an event that
would otherwise constitute Good Reason will cease to be an event constituting Good Reason upon any of the following: (x) Participant’s
failure to provide written notice to the Company within thirty (30) days of the date the Participant has actual knowledge of the
facts or circumstances giving rise thereto, (y) substantial correction of such occurrence by the Company within thirty (30) days
following receipt of Participant’s written notice described in (x), or (z) Participant’s failure to actually terminate
employment within the ten (10) day period following the expiration of the Company’s thirty (30) day cure period.

 

“Qualifying
Termination” means the termination of Participant’s employment (i) by the Company for a reason other than Cause,
(ii) by Participant for Good Reason, or (iii) due to Participant’s death or Disability.

 

3.          Release.
As a condition to receiving the Retention Bonus, Participant hereby agrees to release any and all Claims (as defined below) against
the Company, its affiliates, and their respective directors, officers and employees. “Claims” means claims,
charges, or complaints for, or related to, any breach of contract, violation of any statute or law, or tortious conduct occurring,
or based on events occurring, on or before the date of this Amendment; provided that Claims do not include, and Participant
is not releasing: (a) any claims that may not be released as a matter of law; (b) any claims or rights that arise after Participant
signs this Agreement (including claims based on an event occurring after the date Participant signs this Agreement); (c) any
claims or rights with respect to accrued compensation or benefits; (d) any claims or rights for indemnification, advancement of
defense costs or other fees and expenses and related matters, arising as a matter of law or under the organizational documents
of the Company or its affiliates or under any applicable insurance policy with respect to Participant’s liability as an employee,
director, manager or officer of the Company or its affiliates; and (e) any claims or rights under the directors and officers and
other insurance policies of the Company and its affiliates.

 

    	 	2	 

     

    

 

4.          Withholding
Taxes. The Company may withhold from any and all amounts payable to Participant hereunder such federal, state, and local taxes
as the Company determines in its sole discretion may be required to be withheld pursuant to any applicable law or regulation.

 

5.          No
Right to Continued Employment. Nothing in this Agreement will confer upon Participant any right to continued employment with
the Company (or its Affiliates or their respective successors) or to interfere in any way with the right of the Company (or its
Affiliates or their respective successors) to terminate Participant’s employment at any time.

 

6.          Other
Benefits. The Retention Bonus is a special payment to you, the above-named Participant, and will not be taken into account
in computing the amount of salary or compensation for purposes of determining any bonus, incentive, pension, retirement, death,
or other benefit under any other bonus, incentive, pension, retirement, insurance, or other employee benefit plan of the Company,
unless such plan or agreement expressly provides otherwise.

 

7.          Governing
Law. This Agreement will be governed by, and construed under and in accordance with, the internal laws of the State of Texas,
without reference to rules relating to conflicts of laws.

 

8.          Counterparts.
This Agreement may be executed in one 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.

 

9.          Entire
Agreement; Amendment. This Agreement constitutes the entire agreement between Participant and the Company with respect to the
Retention Bonus and supersedes any and all prior agreements or understandings between Participant and the Company with respect
to the Retention Bonus, whether written or oral. This Agreement may be amended or modified only by a written instrument executed
by you and the Company.

 

10.         Section
409A Compliance. Although the Company does not guarantee the tax treatment of the Retention Bonus, the intent of the parties
is that the Retention Bonus be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and
the regulations and guidance promulgated thereunder, and accordingly, to the maximum extent permitted, this Agreement shall be
interpreted in a manner consistent therewith.

 

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This Agreement is intended
to be a binding obligation on you, the above-named Participant, and the Company. If this Agreement accurately reflects your understanding
as to the terms and conditions of the Retention Bonus, please sign, date, and return to me one copy of this Agreement. You should
make a copy of the executed Agreement for your records.

 

	 	Very truly yours,
	 	 
	 	EV MANAGEMENT, LLC
	 	 	 
	 	By:	/s/ John B. Walker
	 	 	 
	 	Name:	John B. Walker
	 	 	 
	 	Its:  	Executive Chairman

 

The above terms and
conditions accurately reflect our understanding regarding the terms and conditions of the Retention Bonus, and I hereby confirm
my agreement to the same.

 

Dated: November 17, 2017                   

 

	 	/s/ Michael E. Mercer
	 	Participant’s Signature

 

Signature Page to Agreement

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