Related Party Transactions and Outside Related Director Information

Gasco Energy, Inc. (GSX)

4/28/2006 Proxy Information

Marc A. Bruner Strategic Consulting Agreement The Company entered into a Strategic Consulting Agreement with Mr. Bruner, effective January 2, 2003, that expires on January 31, 2007. The agreement is automatically extended each year for an additional one year-term from the next anniversary date unless the Company notifies Mr. Bruner in writing at least 120 days prior to the next anniversary date that the Company will not be renewing the agreement on the next anniversary date. The agreement entitles Mr. Bruner to an annual fee of $120,000 and an annual bonus payment equal to 0.875% of Gasco's cash flow from wells drilled by or on behalf of the Company. Mr. Bruner received an annual bonus of $86,887 for the year ended December 31, 2005. The agreement provided for the award to Mr. Bruner of 187,500 shares of common stock of the Company from a restricted stock plan in exchange for the surrender by Mr. Bruner of vested options to purchase 150,000 shares of common stock at $3.15 per share, 50,000 shares of common stock at $3.00 per share and 925,000 shares of common stock at $2.00 per share. Mr. Bruner also has the right to receive 25% of all option grants made by the Company each calendar year during the term of the agreement. Mr. Bruner waived this right with respect to all option grants during 2005 and 2004. In addition, the agreement provides that each year Mr. Bruner and the Company shall mutually agree on a performance-based bonus plan for Mr. Bruner. The agreement also contains non-compete provisions in the event of the termination of the agreement. Mr. Bruner's agreement also provides for certain payments in the event that the agreement is terminated for any reason other than his voluntary termination, death, disability or termination for cause. In the event that Mr. Bruner's agreement is terminated by the Company without cause or due to certain change of control events, Mr. Bruner is entitled to receive an amount equal to his annual fee for the remaining term of the agreement plus an additional cash payment of $500,000. If the termination occurs at anytime when the average closing price for the Company's common stock for the 30 trading days prior to termination is equal to between $1.50 per share and $1.99 per share, the additional cash payment will increase to $1,000,000. This payment will be further increased as such average closing price increases, up to a maximum of $3,500,000 if such average closing price is greater than $3.50 per share. If the termination is because of a change of control of the Company, the additional cash payment will be based on the consideration per share paid to the Company's shareholders in connection with the change of control instead of the market price of the Company's common stock. Other Transactions On October 11, 2004, the Board of Directors of Gasco, other than Mr. Erickson and Mr. Bruner, approved a transaction pursuant to which Marc Bruner, the chairman of Gasco's Board of Directors, and Mark Erickson, a director and President and Chief Executive Officer of Gasco, would transfer to Gasco their rights to receive certain overriding royalty interests in its properties in exchange for the grant to each of them of options to purchase 100,000 shares of Gasco common stock at the market price on the date of grant. Messrs. Bruner and Erickson subsequently agreed to transfer such rights to Gasco for no options or other consideration. For each individual, these interests range between .06% and 0.6% of Gasco's working interest in certain of its Utah and Wyoming properties. Gasco will also agree to convey equivalent royalty interests to Mr. Bruner and Mr. Erickson, or either of them, in the event that it sells any of the property subject to the royalty interests, upon certain change of control events or upon the involuntary termination of either individual. Mr. Bruner and Mr. Erickson acquired these rights under a Trust Termination and Distribution Agreement, dated December 31, 2002, with respect to the Pannonian Employee Royalty Trust ("Royalty Trust"). The Royalty Trust had been established by Pannonian Energy, Inc. ("Pannonian") prior to Pannonian becoming a wholly owned subsidiary of Gasco, to provide additional compensation to the employees and founding directors of Pannonian, which included Mr. Bruner and Mr. Erickson, in the form of oil and gas interests. The terms of the Trust Termination and Distribution Agreement ("Termination Agreement") required Gasco to assign to the participants of the Royalty Trust overriding royalty interests that arise out of the production of oil and gas from certain properties as a result of future drilling. The transaction was reviewed and approved by Gasco's Audit Committee and was signed by Mr. Erickson and Mr. Bruner on December 23, 2004. During the years ended December 31, 2005, 2004 and 2003 the Company paid $120,000 in consulting fees each year and an annual bonus of $86,887 during the year ended December 31, 2005 to a company owned by Mr. Bruner pursuant to the Strategic Consulting Agreement described above. The Company is committed to pay consulting fees of $120,000 per year to Mr. Bruner's company through January 31, 2007. During the year ended December 31, 2005 Mr. Bruner was awarded 75,000 options to purchase shares of common stock at an exercise price of $3.39 per share. These options vest 25% at the end of each calendar quarter beginning September 30, 2005. During the year ended December 31, 2004 Mr. Bruner was awarded 50,000 options to purchase common stock at an exercise price of $2.15 per share. These options vest 16 2/3% at the end of each four-month period after the issuance date. During the year ended December 31, 2003, the Company issued 187,500 shares of common stock to Mr. Bruner from the Company's restricted stock plan. These restricted shares vest 20% on the first anniversary, 20% on the second anniversary and 60% on the third anniversary of the award.