Exhibit 10.29

PURCHASE AND SALE AGREEMENT
AMONG
COG OPERATING LLC AND
CONCHO OIL & GAS LLC
AS SELLER
AND
LEGACY RESERVES OPERATING LP
AS BUYER

November 5, 2012

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TABLE OF CONTENTS
 
 
 
Page No.
 
Article I Definitions and Usage
1

 
Section 1.01
 
Definitions
1

 
Section 1.02
 
Usage
5

Article II Assets
6

 
Section 2.01
 
Agreement to Sell and Purchase
6

 
Section 2.02
 
Assets
6

 
Section 2.03
 
Excluded Assets
7

Article III Purchase Price
11

 
Section 3.01
 
Purchase Price
11

 
Section 3.02
 
Deposit.
11

 
Section 3.03
 
Effective Time
11

Article IV Title Matters
11

 
Section 4.01
 
Examination Period
11

 
Section 4.02
 
Defensible Title and Permitted Encumbrances
12

 
Section 4.03
 
Title Defect
16

 
Section 4.04
 
Notice of Title Defects.
17

 
Section 4.05
 
Remedies for Title Defects.
18

 
Section 4.06
 
Special Warranty of Title
20

 
Section 4.07
 
Preferential Rights To Purchase.
20

 
Section 4.08
 
Consents to Assignment
21

 
Section 4.09
 
Title Benefits; Remedies.
21

Article V Environmental Matters
22

 
Section 5.01
 
Environmental Review.
22

 
Section 5.02
 
Environmental Definitions.
23

 
Section 5.03
 
Notice of Environmental Defects
24

 
Section 5.04
 
Remedies for Environmental Defects.
25

 
Section 5.05
 
No Warranty Regarding Environmental Matters
26

 
Section 5.06
 
Physical Condition of the Assets
26

 
Section 5.07
 
NORM
26

Article VI Representations and Warranties of Seller
27

 
Section 6.01
 
Seller's Existence
27

 
Section 6.02
 
Legal Power
27

 
Section 6.03
 
Execution
28

 
Section 6.04
 
Brokers
28

 
Section 6.05
 
Bankruptcy
28

 
Section 6.06
 
Proceedings
28

 
Section 6.07
 
Royalties
28

 
Section 6.08
 
Taxes
28

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Section 6.09
 
Contracts
28

 
Section 6.10
 
Governmental Authorizations
28

 
Section 6.11
 
No Violations of Laws
29

 
Section 6.12
 
No Prepayments
29

 
Section 6.13
 
AFE's
29

 
Section 6.14
 
Litigation
29

 
Section 6.15
 
Suspense Accounts
29

 
Section 6.16
 
Hydrocarbon Sales Agreements
29

 
Section 6.17
 
Records
29

Article VII Representations and Warranties of Buyer
30

 
Section 7.01
 
Buyer's Existence
30

 
Section 7.02
 
Legal Power
30

 
Section 7.03
 
Execution
30

 
Section 7.04
 
Brokers
30

 
Section 7.05
 
Bankruptcy
30

 
Section 7.06
 
Proceedings
30

 
Section 7.07
 
Qualifications
31

 
Section 7.08
 
Investment
31

 
Section 7.09
 
Funds
31

 
Section 7.10
 
Independent Investigation
31

Article VIII Tax-Deferred Exchange
32

 
Section 8.01
 
Election
32

 
Section 8.02
 
Qualified Intermediary
32

 
Section 8.03
 
Additional Costs
32

 
Section 8.04
 
Indemnification
32

Article IX Seller's Conditions to Close
32

 
Section 9.01
 
Representations
32

 
Section 9.02
 
Performance
32

 
Section 9.03
 
Pending Matters
32

Article X Buyer's Conditions to Close
33

 
Section 10.01
 
Representations
33

 
Section 10.02
 
Performance
33

 
Section 10.03
 
Pending Matters
33

Article XI Purchase Price Allocation and Tax Matters
33

 
Section 11.01
 
Purchase Price Allocation
33

 
Section 11.02
 
Transfer Taxes
33

 
Section 11.03
 
Audit Rights
34

Article XII The Closing
34

 
Section 12.01
 
Time and Place of the Closing
34

 
Section 12.02
 
Adjustments to Purchase Price at the Closing.
35

 
Section 12.03
 
Closing Statement
36

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Section 12.04
 
Actions of Seller at the Closing
36

 
Section 12.05
 
Actions of Buyer at the Closing
37

Article XIII Termination
38

 
Section 13.01
 
Right of Termination
38

 
Section 13.02
 
Effect of Termination
39

 
Section 13.03
 
Termination Damages.
39

 
Section 13.04
 
Return of Documents and Confidentiality
39

 
Section 13.05
 
Damages
39

Article XIV Post-Closing Obligations
39

 
Section 14.01
 
Gas Imbalances
39

 
Section 14.02
 
Final Accounting Statement.
40

 
Section 14.03
 
Further Cooperation
41

 
Section 14.04
 
After the Closing
41

Article XV Operation of the Assets
41

 
Section 15.01
 
Operations
41

 
Section 15.02
 
Limitations on the Operational Obligations and Liabilities of Seller.
43

 
Section 15.03
 
Operation of the Assets after the Closing
43

 
Section 15.04
 
Change in Circumstances; Casualty Loss.
44

Article XVI Obligations and Indemnification
44

 
Section 16.01
 
Retained Obligations
44

 
Section 16.02
 
Assumed Obligations
45

 
Section 16.03
 
Buyer's Indemnification
45

 
Section 16.04
 
Seller's Indemnification
45

 
Section 16.05
 
Notices and Defense of Indemnified Matters.
46

Article XVII Limitations on Representations and Warranties
47

 
Section 17.01
 
Disclaimers of Representations and Warranties
47

 
Section 17.02
 
Sale “As Is” “Where Is”
48

 
Section 17.03
 
DISCLAIMER REGARDING THE ASSETS
48

 
Section 17.04
 
DISCLAIMER REGARDING INFORMATION
49

Article XVIII Dispute Resolution
49

 
Section 18.01
 
Scope; Appointment of Independent Expert
49

 
Section 18.02
 
Additional Procedures
50

 
Section 18.03
 
Waiver
51

 
Section 18.04
 
Binding Nature
51

 
Section 18.05
 
Confidentiality
51

Article XIX Miscellaneous
51

 
Section 19.01
 
Names
51

 
Section 19.02
 
Expenses
51

 
Section 19.03
 
Filings, Notices and Certain Governmental Approvals
51

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Section 19.04
 
Document Retention
52

 
Section 19.05
 
Entire Agreement
52

 
Section 19.06
 
Waiver
52

 
Section 19.07
 
Construction
52

 
Section 19.08
 
No Third Party Beneficiaries
52

 
Section 19.09
 
Assignment
53

 
Section 19.10
 
Governing Law
53

 
Section 19.11
 
Jurisdiction
53

 
Section 19.12
 
Notices
53

 
Section 19.13
 
Severability
54

 
Section 19.14
 
Survival
54

 
Section 19.15
 
Time of the Essence
54

 
Section 19.16
 
Counterpart Execution
54

 
Section 19.17
 
Knowledge
54

 
Section 19.18
 
Press Releases.
55

 
Section 19.19
 
Exclusivity; Waiver of Rescission.
55

 
Section 19.20
 
Waiver of Trade Practices Act.
55

EXHIBITS AND SCHEDULES
Exhibit A - Subject Interests (Listing of Leases)
Exhibit A-1 -    Easements
Exhibit B - Wells, Interests and Allocated Values
Exhibit C - Assignment and Bill of Sale
Exhibit D - Title Indemnity Agreement
Exhibit E - Environmental Indemnity Agreement

Schedule 2.02(f)- Electricity Contracts
Schedule 2.03(z)- Miscellaneous Excluded Assets
Schedule 6.10- Governmental Authorizations
Schedule 6.11- No Violations of Laws
Schedule 6.13 - AFE's
Schedule 6.15 - Suspense Accounts
Schedule 6.16 - Hydrocarbon Sales Agreements
Schedule 14.01 - Gas Imbalances

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PURCHASE AND SALE AGREEMENT

This Purchase and Sale Agreement (this “Agreement”) is made and entered into
this 5th day of November, 2012, by and among COG OPERATING LLC, a Delaware
limited liability company (“COG”), CONCHO OIL & GAS LLC, a Texas limited
liability company (“Concho LLC”, together with COG, “Seller”), and LEGACY
RESERVES OPERATING LP, a Delaware limited partnership (“Buyer”). Buyer and
Seller are collectively referred to as the “Parties” and individually as a
“Party.”
W I T N E S S E T H:
WHEREAS, Seller is willing to sell to Buyer, and Buyer is willing to purchase
from Seller, the Assets (as defined in Section 2.02), all upon the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual benefits derived and to be
derived from this Agreement by each Party, Seller and Buyer agree as follows:
Article I
Definitions and Usage

Section 1.01Definitions. For purposes of this Agreement, the following terms and
their variations have the meanings specified or referred to in this Section
1.01:

“Accounting Statement” - as defined in Section 14.02(a).
“Advisor” - as defined in Section 2.03(g).
“Affiliate” - as defined in Section 2.03(h).
“Agreed Imbalance” - as defined in Section 14.01.
“Agreement” - as defined in the first paragraph of this Agreement.
“Allocated Value” - as defined in Section 4.04(c)(ii).
“Asset” or “Assets” - as defined in Section 2.02.
“Assignment” - as defined in Section 4.06.
“Assumed Environmental Obligations” - as defined in Section 5.02(a).
“Assumed Obligations” - as defined in Section 16.02.
“Business Day” - as defined in Section 4.01.
“Buyer” - as defined in the first paragraph of this Agreement.

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“Buyer's Auditor” - as defined in Section 11.03.
“Buyer Indemnitees” - as defined in Section 16.04.
“Buyer's Environmental Consultant” - as defined in Section 5.01(a).
“Buyer's Environmental Review” - as defined in Section 5.01(a).
“Claim” - as defined in Section 16.05(b).
“Claim Notice” - as defined in Section 16.05(b).
“Closing” - as defined in Section 12.01.
“Closing Date” - as defined in Section 12.01.
“Closing Statement” - as defined in Section 12.03.
“Code” - as defined in Section 8.01.
“COG” - as defined in the first paragraph of this Agreement.
“Concho LLC” - as defined in the first paragraph of this Agreement.
“Confidentiality Agreement” - as defined in Section 4.01.
“Contracts” - as defined in Section 2.02(f).
“Control” - as defined in Section 2.03(h).
“Defensible Title” - as defined in Section 4.02(a).
“Deposit” - as defined in Section 3.02(a).
“Dispute” or “Disputes” - as defined in Section 18.01.
“Documents” - as defined in Section 19.04.
“DTPA” - as defined in Section 19.20(a).
“Easements” - as defined in Section 2.02(c).
“Effective Time” - as defined in Section 3.03.
“Election Notice” - as defined in Section 18.01.
“Environmental Defect” - as defined in Section 5.02(b).
“Environmental Defect Notice” - as defined in Section 5.03.

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“Environmental Defect Value” - as defined in Section 5.02(c).
“Environmental Indemnity Agreement” - as defined in Section 5.04(a)(ii).
“Environmental Information” - as defined in Section 5.01(b).
“Environmental Laws” - as defined in Section 5.02(d).
“Examination Period” - as defined in Section 4.01.
“Excluded Assets” - as defined in Section 2.03.
“Final Statement” - as defined in Section 14.02(b).
“Final Settlement Date” - as defined in Section 14.02(a).
“Gas Imbalances” - as defined in Section 14.01.
“Governmental Authority” - as defined in Section 4.02(b)(v)
“Governmental Authorizations” - as defined in Section 6.10.
“Hazardous Substances” - as defined in Section 5.02(e).
“Hydrocarbons” - as defined in Section 2.02(d).
“Indemnified Environmental Defect” - as defined in Section 5.02(f).
“Indemnified Party” - as defined in Section 16.05(a).
“Indemnified Title Defect” - as defined in Section 4.05(a)(ii).
“Indemnifying Party” - as defined in Section 16.05(a).
“Independent Expert” - as defined in Section 18.01.
“Knowledge” - as defined in Section 19.17.
“Law” - as defined in Section 1.02(a)(v).
“Leases” - as defined in Section 2.02(a).
“Loss” or “Losses” - as defined in Section 16.03.
“Material Adverse Effect” means any change, inaccuracy, circumstance, effect,
event, result, occurrence, condition or fact (whether or not (i) foreseeable or
known as of the date of this Agreement or (ii) covered by insurance) that has
had, or would reasonably be expected to have, a material adverse effect on the
ownership, operation or value of the Assets, taken as a whole.

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“Net Revenue Interest” or “NRI” - as defined in Section 4.02(a)(i).
“NORM” - as defined in Section 5.07.
“Notice of Disagreement” - as defined in Section 14.02(a).
“Parties” - as defined in the first paragraph of this Agreement.
“Permitted Encumbrances” - as defined in Section 4.02(b).
“Person” - as defined in Section 2.03(h).
“Personal Property” - as defined in Section 2.02(d).
“PPRs” - as defined in Section 4.07(a).
“Purchase Price” - as defined in Section 3.01.
“Purchase Price Adjustments” - as defined in Section 12.02(c).
“Records” - as defined in Section 2.02(g).
“Retained Obligations” - as defined in Section 16.01.
“Rules” - as defined in Section 18.01.
“Seller” - as defined in the first paragraph of this Agreement.
“Seller Indemnitees” - as defined in Section 15.02(b).
“Seller Ownership Period” - as defined in Section 6.07.
“Subject Interest” or “Subject Interests” - as defined in Section 2.02(a).
“Subject Property” - as defined in Section 5.02(a).
“Tangible Property” - as defined in Section 17.03.
“Taxes” - as defined in Section 2.03(c).
“Third Party” - as defined in Section 4.02(b)(ix).
“Title Benefit” - as defined in Section 4.09.
“Title Defect” - as defined in Section 4.03.
“Title Defect Notice” - as defined in Section 4.04(a).
“Title Defect Value” - as defined in Section 4.04(c).

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“Title Indemnity Agreement” - as defined in Section 4.05(a)(ii).
“Transfer Taxes” - as defined in Section 11.02.
“Unadjusted Purchase Price” - as defined in Section 3.01.
“Working Interest” or “WI” - as defined in Section 4.02(a)(ii).
Section 1.02Usage.
(a)In this Agreement, unless a clear contrary intention appears:

(i)the singular number includes the plural number and vice versa;

(ii)reference to any Person includes that Person's successors and assigns but,
if applicable, only if those successors and assigns are not prohibited by this
Agreement, and reference to a Person in a particular capacity excludes that
Person in any other capacity or individually;

(iii)reference to any gender includes each other gender;

(iv)reference to any agreement, document or instrument means that agreement,
document or instrument as amended or modified and in effect from time to time in
accordance with its terms;

(v)reference to any law, rule, regulation, order or decree of any Governmental
Authority including any legislative body, court or administrative agency (“Law”)
means that Law as amended, modified, codified, replaced or reenacted, in whole
or in part, and in effect from time to time, including rules and regulations
promulgated under it, and reference to any section or other provision of any Law
means that provision of that Law from time to time in effect and constituting
the amendment, modification, codification, replacement or reenactment of that
section or other provision;

(vi)“hereunder,” “hereof,” “hereto,” and words of similar import shall be deemed
references to this Agreement as a whole and not to any particular Article,
Section or other provision of this Agreement;

(vii)“including” (and with correlative meaning “include”) means including
without limiting the generality of any description preceding that term;

(viii)“or” is used in the inclusive sense of “and/or”;

(ix)with respect to the determination of any period of time, “from” means “from
and including” and “to” means “to but excluding”;

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(x)references to documents, instruments or agreements shall be deemed to refer
as well to all addenda, exhibits, schedules or amendments to them;

(xi)references to any Exhibit or Schedule means an Exhibit or Schedule attached
to this Agreement, all of which are incorporated into and made a part of this
Agreement; and

(xii)references to any Article or Section means an Article or Section of this
Agreement.

(b)Unless otherwise specified, all accounting terms used in this Agreement shall
be interpreted, and all accounting determinations under this Agreement shall be
made, in accordance with United States generally accepted accounting principles.

(c)This Agreement was negotiated by the Parties with the benefit of legal
representation, and any rule of construction or interpretation otherwise
requiring this Agreement to be construed or interpreted against any Party shall
not apply to any construction or interpretation of this Agreement.

Article II
Assets

Section 2.02Agreement to Sell and Purchase. Subject to and in accordance with
the terms and conditions of this Agreement, Buyer agrees to purchase the Assets
from Seller, and Seller agrees to sell the Assets to Buyer.

Section 2.02Assets. Subject to Section 2.03, the term “Assets” (or in the
singular “Asset”) means all of Seller's right, title and interest in and to:

(a)the oil, gas and/or mineral leases described in Exhibit A together with all
amendments, supplements, renewals, extensions or ratifications thereof, insofar
and only insofar as said leases cover the lands and depths described in Exhibit
A (collectively, the “Leases”), and all oil, gas and/or mineral leasehold
interests, reversionary, back-in, net profits, carried, convertible, non-consent
and overriding royalty interests, operating rights, record title and other
similar interests in the Leases (collectively, the “Subject Interests” or,
singularly, a “Subject Interest”);

(b)except to the extent as may be limited by the Subject Interests or to the
extent used or held in connection with the Excluded Assets, all rights,
privileges, benefits and powers conferred upon Seller as holder of the Subject
Interests, with respect to (i) all rights of use and occupation of the surface
of and the subsurface depths under the Subject Interests, and (ii) all rights
with respect to any pooled, communitized or unitized acreage by virtue of any
Subject Interest being a part thereof, including all Hydrocarbon production
after the Effective Time attributable to the Subject Interests or any such pool
or unit allocated to any such Subject Interest;

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(c)to the extent assignable or transferable by Seller, all easements,
rights-of-way, surface leases, servitudes, permits, licenses, franchises and
other estates or similar rights and privileges directly related to and to the
extent used in connection with the Subject Interests, including those described
or referred to in Exhibit A-1 (the “Easements”);

(d)to the extent assignable or transferable by Seller and to the extent not used
or held in connection with the Excluded Assets, all personal property,
equipment, fixtures, inventory and improvements located on and used directly in
connection with the Subject Interests or the Easements or with the production,
treatment, sale, or disposal of oil, gas or other hydrocarbons produced from or
attributable to the Subject Interests (collectively, “Hydrocarbons”), byproducts
or waste produced from or attributable to the foregoing, including all wellhead
equipment, pumps, pumping units, flowlines, gathering systems, piping, tanks,
buildings, treatment facilities, disposal facilities, compression facilities,
and other materials, supplies, equipment, facilities and machinery
(collectively, “Personal Property”);

(e)all wells, to the extent not used or held in connection with the Excluded
Assets, which are located on the lands covered by the Subject Interests or on
lands with which the Subject Interests may have been pooled, communitized or
unitized (whether producing, shut in or abandoned), including the wells
described in Exhibit B;

(f)to the extent assignable or transferable by Seller and to the extent not used
or held in connection with the Excluded Assets, all contracts, warranties,
agreements and other arrangements, and all express and implied rights that
directly relate to the Subject Interests, the Leases or the Easements, including
communitization, unitization or pooling agreements, production sales contracts,
farmout agreements, subleases, joint venture or partnership agreements,
operating agreements, service agreements, exploration agreements, transportation
or gathering agreements, agreements for the sale and purchase of Hydrocarbons,
the electricity contracts set forth on Schedule 2.02(f) attached hereto, but
only to the extent expressly set forth on such schedule, processing agreements
and other similar contracts, agreements and other arrangements (the
“Contracts”), provided that "Contracts" shall not include the instruments
constituting the Leases; and

(g)to the extent assignable or transferable by Seller and to the extent not used
or held in connection with the Excluded Assets, all books, records, files,
muniments of title, reports and similar documents and materials, including lease
records, well records, and division order records, well files, well logs, title
records (including abstracts of title, title opinions and memoranda, and title
curative documents directly related to the Assets), contracts and contract
files, correspondence, that directly relate to the foregoing interests in the
possession of, and maintained by, Seller (collectively, the “Records”),
provided, however, that Seller may retain the copies of such Records as Seller
has reasonably determined may be required for existing litigation, tax,
accounting and auditing purposes.

Section 2.03Excluded Assets. Notwithstanding the foregoing, the Assets shall not
include, and there is excepted, reserved and excluded from the sale contemplated
by this Agreement (collectively, the “Excluded Assets”):

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(a)all fee mineral, royalty and other similar non-leasehold oil, gas or other
mineral interests and estates, and all surface fee interests, in the lands
covered by the Leases or used or held in connection with the Assets;

(b)all trade credits and all accounts, accounts receivable, checks, funds,
promissory notes, instruments and general intangibles (as those terms are
defined in the Texas Uniform Commercial Code) attributable to the Assets with
respect to any period of time prior to the Effective Time;

(c)all claims of Seller for, and rights of Seller to, refunds of or loss
carryovers with respect to (i) any Taxes with respect to the Assets for any
taxable year or period, or portion thereof, that ends at or before the Effective
Time, (ii) any Taxes with respect to the Excluded Assets, or (iii) those other
refunds, and rights to them, for amounts paid in connection with the Assets and
attributable to the period prior to the Effective Time, including refunds of
amounts paid under any Hydrocarbon gathering or transportation agreement; and
for purposes of this Agreement, the term “Taxes” means any and all taxes,
including any interest, penalties or other additions to tax that may become
payable in respect of any tax, imposed by any Governmental Authority, which
taxes shall include, without limiting the generality of the foregoing, all
income taxes, profits taxes, margin taxes, alternative minimum taxes, estimated
taxes, payroll taxes, employee withholding taxes, unemployment insurance taxes,
social security taxes, welfare taxes, disability taxes, severance taxes, license
charges, sales taxes, use taxes, ad valorem taxes, value added taxes, excise
taxes, franchise taxes, gross receipts taxes, real or personal property taxes,
stamp taxes, production taxes, environmental taxes, transfer taxes, workers'
compensation taxes, windfall taxes, net worth taxes, and other taxes, fees,
duties, levies, customs, tariffs, imposts, assessments, obligations and charges
of the same or of a similar nature to any of the foregoing;

(d)all proceeds, income, royalties or revenues (and any security or other
deposits made) attributable to (i) the Assets for any period prior to the
Effective Time or (ii) any other Excluded Assets;

(e)all Hydrocarbons produced from or attributable to the Subject Interests with
respect to all periods prior to the Effective Time, together with all proceeds
from the sale of those Hydrocarbons;

(f)all geophysical data, interpretations and information related to the Assets,
and all of Seller's proprietary or licensed computer software, technology,
patents, trade secrets, copyrights, names, trademarks, logos and other
intellectual property;

(g)all documents and instruments of Seller (other than title opinions) (i) that
may be protected by an attorney-client, work product or other privilege; (ii)
prepared by or for counsel of Seller; or (iii) received from RBC Richardson
Barr, RBC Capital Markets or any other financial, commercial or legal advisor of
Seller (each, an “Advisor”);

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(h)all (i) agreements and correspondence between Seller or any of Seller's
Affiliates and any Advisor relating to the transactions contemplated in this
Agreement; (ii) lists of prospective purchasers for those transactions compiled
by Seller or any of Seller's Affiliates or any Advisor; (iii) bids submitted by
other prospective purchasers of the Assets; (iv) analyses by Seller or any of
Seller's Affiliates or any Advisor of any bids submitted by any prospective
purchaser; (v) correspondence between Seller or any of Seller's Affiliates or
any Advisor, or any of their respective representatives, and any prospective
purchaser other than Buyer; and (vi) correspondence between Seller or any of
Seller's Affiliates or any Advisor or any of their respective representatives
with respect to any of the bids, the prospective purchasers, the engagement or
activities of any Advisor, or the transactions contemplated in this Agreement;
and for purposes of this Agreement, the term “Affiliate” means, with respect to
any Person, any other Person controlling, controlled by or under common control
with that Person, where the term “control” (and correlative terms) means the
power, whether by contract, equity ownership or otherwise, to direct the
policies or management of a Person; and the term “Person” means an individual,
corporation, partnership, limited liability company, association, trust,
unincorporated organization or other entity;

(i)all data and other information that may not be disclosed or assigned to Buyer
as a result of confidentiality or similar arrangements under agreements with
Persons not Affiliates of Seller, even if such data or other information is
inadvertently disclosed or provided to Buyer (in which case Buyer shall promptly
return such data or information to Seller);

(j)all audit rights arising under any of the Contracts or otherwise with respect
to any period prior to the Effective Time or to any of the Excluded Assets,
subject to the provisions of Section 11.03 hereof;

(k)all corporate, partnership and limited liability company financial and income
tax books, accounts, records and documents of Seller or any of Seller's
Affiliates;

(l)all claims and causes of action of Seller (i) arising from acts, omissions or
events related to, or damage to or destruction of, the Assets, occurring prior
to the Effective Time; (ii) arising under or with respect to any of the
Contracts that are attributable to periods of time prior to the Effective Time
(including claims for adjustments or refunds); or (iii) with respect to any of
the Excluded Assets;

(m)all rights and interests of Seller (i) under any policy or agreement of
insurance or indemnity; (ii) under any bond; or (iii) to any insurance or
condemnation proceeds or awards arising, in each case, from acts, omissions or
events related to, or damage to or destruction of, the Assets occurring prior to
the Effective Time;

(n)all amounts due or payable to Seller as adjustments to insurance premiums
related to the Assets with respect to any period prior to the Effective Time;

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(o)all amounts resulting from derivative contracts or similar agreements used to
manage oil, natural gas, products or other commodity prices whether deemed a
hedge, non-hedge or ineffective hedge transaction;

(p)all proceeds, income, revenues or other benefits (including any benefit
attributable to any future laws or regulations with respect to “royalty relief”
or other similar measures) not otherwise enumerated above, as well as any
security or other deposits made, attributable to (i) the Assets for any period
prior to the Effective Time; or (ii) the Excluded Assets;

(q)all funds held in suspense accounts related to the Assets;

(r)all vehicles, vessels, trailers, software, computers and associated
peripherals and all radio, telephone and other communication equipment, except
for any such equipment attached to a well included as an Asset pursuant to
Section 2.02(e);

(s)all oil, gas or other mineral reserve reports, and all environmental site
assessments, reports and related data and information;

(t)all rights or benefits under or in connection with any State or Federal
candidate conservation agreements or similar agreements;

(u)all books, records and files that relate to the Excluded Assets;

(v)any records retained by Seller pursuant to Section 2.02(g);

(w)Seller's area-wide bonds, permits and licenses or other permits, licenses or
authorizations used in the conduct of Seller's business generally;

(x)all rights of Seller in formations, strata, horizons or depths that are
excepted or excluded in the land descriptions contained in Exhibit A;

(y)all rights of Seller under this Agreement or under any instruments executed
and delivered in connection with the Closing; and

(z)all items which would have constituted “Assets” as defined in Section 2.02
but for, and only to the extent of, their being used or held in connection with
the Excluded Assets, and all surface leases and other items listed on Schedule
2.03(z).

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Article III
Purchase Price

Section 3.01Purchase Price. The total consideration for the purchase, sale and
conveyance of the Assets to Buyer is Buyer's payment to Seller of the sum of
$520,000,000.00 (the “Unadjusted Purchase Price”), as adjusted in accordance
with the provisions of this Agreement (the “Purchase Price”).

Section 3.02Deposit.

(a)Within three (3) Business Days following the execution of this Agreement by
Buyer and Seller, Buyer shall deliver to Seller a performance guarantee deposit
in an amount equal to ten percent (10%) of the Unadjusted Purchase Price (the
“Deposit”). The Deposit shall be paid by Buyer to Seller by means of a completed
federal funds transfer to an account designated by Seller. If the Deposit is not
paid to Seller within such period, this Agreement shall be null and void and no
Party shall have any further rights or obligations under this Agreement.

(b)If the Closing occurs, the Deposit shall be retained by Seller and shall be
applied as part of the payment of the Purchase Price, and the amount payable by
Buyer at the Closing shall be reduced by that amount in accordance with Section
12.03.

(c)If the Agreement is terminated without the Closing having occurred, the
Deposit shall be applied as provided in Article XIII.

Section 3.03Effective Time. If the transactions contemplated by this Agreement
are consummated in accordance with the terms and provisions of this Agreement,
the ownership of the Assets shall be transferred from Seller to Buyer on the
Closing Date, and effective as of 7:00 a.m. local time where the Assets are
located on October 1, 2012 (the “Effective Time”).

Article IV
Title Matters

Section 4.01Examination Period. The Examination Period shall run from the date
of this Agreement until December 13, 2012 at Noon, local time in Midland, Texas
(the “Examination Period”). During the Examination Period, Seller shall permit
Buyer and/or its authorized representatives to examine, during normal business
hours, in the offices of Seller, all abstracts of title, title opinions, title
files, ownership maps, lease files, contract files, assignments, division orders
and royalty accounting records pertaining to the Assets insofar as same may now
be in existence and in the possession of Seller or Seller's Affiliates, subject
to such restrictions on disclosure as may exist under confidentiality agreements
or other agreements binding on Seller or such data. Such examination shall be
upon reasonable notice and shall not unreasonably disrupt the personnel and
operations of Seller or otherwise impede the efforts of Seller to comply with
Seller's other obligations under this Agreement. Any such examination by Buyer
shall be at Buyer's sole cost and expense. All information made available to
Buyer, whether disclosed pursuant to this Agreement or otherwise, shall be
maintained confidential by

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Buyer as provided in the Confidentiality Agreement dated September 7, 2012,
between Concho Resources Inc. and Buyer (the “Confidentiality Agreement”), the
terms of which are incorporated into this Agreement by this reference and made a
part of this Agreement except that the non-solicitation of employees set forth
in the Confidentiality Agreement shall not be applicable to Seller's employees
who have non-supervisory field positions related to the Assets, and Buyer shall
be entitled to approach such employees with respect to employment with Buyer
upon Buyer's acquisition of such Assets. Buyer shall take whatever reasonable
steps as may be necessary to ensure that Buyer's employees, consultants,
representatives and agents comply with the provisions of the Confidentiality
Agreement, and shall be responsible for any disclosure or other breach of such
provisions by any such Persons. Buyer shall not contact any of the customers or
suppliers of Seller or Seller's working interest co-owners or operators, in
connection with the transactions contemplated by this Agreement, whether in
person or by telephone, mail or other means of communication, without the
specific prior written consent of Seller, which consent may be withheld at
Seller's sole discretion. For the purpose of this Agreement, the term “Business
Day” means any calendar day excluding Saturdays, Sundays and other days on which
national banks are closed for business in Midland, Texas. The confidentiality
and other obligations in this Section 4.01 shall survive termination of this
Agreement.

Section 4.02Defensible Title and Permitted Encumbrances.

(a)For purposes of this Agreement, the term “Defensible Title” means, with
respect to a given Asset, such ownership by Seller in that Asset that, subject
to and except for Permitted Encumbrances:

(i)with respect to each well, unit, well location or Lease shown on Exhibit B,
entitles Seller to receive, without reduction throughout the productive life of
such well, unit, well location or Lease, not less than the percentage or decimal
interest set forth in Exhibit B as Seller's “Net Revenue Interest” or “NRI” of
all Hydrocarbons produced, saved or marketed from (A) the applicable well or
unit as set forth in Exhibit B as to the currently producing interval in that
well or unit, and (B) the interval or zone identified in Exhibit B with respect
to any non-producing well, unit, well location or Lease set forth in Exhibit B
except, in each case (1) to the extent caused after the date hereof by
continuous development and partial termination provisions contained in the
Leases, (2) to the extent resulting from changes in proration units after the
date hereof, (3) to the extent resulting from changes or adjustments that result
from the establishment of units, changes in existing units or the participating
areas therein, (4) to the extent resulting from the entry into pooling,
communization or unitization agreements after the date hereof, or (5) as
specifically set forth in Exhibit B;

(ii)with respect to each well, unit, well location or Lease shown in Exhibit B,
obligates Seller to bear, without increase throughout the productive life of
such well, unit, well location or Lease, not greater than the percentage or
decimal interest set forth in Exhibit B as Seller's “Working Interest” or “WI”
of the costs and expenses relating to the maintenance, development and operation
of (A) the applicable well or unit set forth in Exhibit B as to the currently
producing

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interval in that well or unit, and (B) the interval or zone identified in
Exhibit B with respect to any non-producing well, unit, well location or Lease
set forth in Exhibit B, except, in each case (1) to the extent any increase in
Working Interest is accompanied by a proportionate increase in the applicable
Net Revenue Interest, (2) to the extent resulting from changes in proration
units after the date hereof, (3) to the extent resulting from changes or
adjustments that result from the establishment of units, changes in existing
units or the participating areas therein, (4) to the extent resulting from the
entry into pooling, communication or unitization agreements after the date
hereof, or (5) as specifically set forth in Exhibit B; and

(iii)is free and clear of all liens, encumbrances, security interests and
pledges and material defects in title.

(b)The term “Permitted Encumbrances” means any of the following matters to the
extent the same are valid and subsisting and affect the Assets:

(i)the terms and provisions of the Leases and Contracts, provided that such
matters do not operate to reduce the Net Revenue Interests of Seller below those
set forth in Exhibit B or increase the Working Interests of Seller above those
set forth in Exhibit B without a corresponding increase in the Net Revenue
Interests;

(ii)any (A) undetermined or inchoate liens or charges constituting or securing
the payment of expenses that were incurred incidental to the maintenance,
development, production or operation of the Assets or for the purpose of
developing, producing or processing Hydrocarbons from or in them, and (B)
materialman's, mechanics', repairman's, employees', contractors' and operators'
liens or other similar liens, privileges or charges for liquidated amounts
arising in the ordinary course of business (1) that Seller has agreed to assume
or pay pursuant to the terms of this Agreement; or (2) for which Seller is
responsible for paying or releasing at or after the Closing pursuant to the
terms of this Agreement;

(iii)any liens for Taxes and assessments not yet delinquent or that are being
contested in good faith;

(iv)the terms, conditions, restrictions, exceptions, reservations, limitations
and other matters contained in (including any liens or security interests
created by law or reserved in oil, gas and other mineral leases for royalty,
bonus or rental, or created to secure compliance with the terms of) the
agreements, instruments and documents that create or reserve to Seller Seller's
interests in the Assets;

(v)any obligations or duties affecting the Assets to any federal, state, county,
municipal or local government authority or judicial or regulatory agency

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or instrumentality (“Governmental Authority”) with respect to any franchise,
grant, license or permit and all applicable Law or any Governmental Authority;

(vi)any (A) easements, rights-of-way, servitudes, permits, surface leases and
other rights in respect of surface operations, pipelines, grazing, hunting,
lodging, canals, ditches, reservoirs or the like, and (B) easements for streets,
alleys, highways, pipelines, telephone lines, power lines, railways and other
similar rights-of-way on, over or in respect of property owned or leased by
Seller or over which Seller owns rights-of-way, easements, permits or licenses,
to the extent that they do not materially interfere with the operations
currently conducted on the Assets;

(vii)all royalties, overriding royalties, net profits interests, carried
interests, production payments, reversionary interests and other burdens on or
deductions from the proceeds of Hydrocarbon production created or in existence
as of the Effective Time, whether recorded or unrecorded, provided that such
matters do not operate to reduce the Net Revenue Interests of Seller below those
set forth in Exhibit B or increase the Working Interests of Seller above those
set forth in Exhibit B without a corresponding increase in the Net Revenue
Interests;

(viii)subject to Section 4.07, preferential rights to purchase or similar
agreements with respect to which (A) waivers or consents are obtained from the
appropriate parties for the transaction contemplated by this Agreement, or
(B) required notices have been given for the transaction contemplated by this
Agreement to the holders of such rights and the appropriate period for asserting
such rights has expired without an exercise of such rights;

(ix)required Third Party consents to assignment or similar agreements with
respect to which (A) waivers or consents are obtained from the appropriate
parties for the transaction contemplated by this Agreement; (B) required notices
have been given for the transaction contemplated by this Agreement to the
holders of those rights and the appropriate period for asserting such rights has
expired without an exercise of such rights; or (C) there is no provision
expressly stating that an assignment in violation thereof (1) is void or
voidable, (2) triggers the payment of specified liquidated damages, or (3)
causes a termination of the Lease or other Asset to be assigned; and for
purposes of this Agreement, the term “Third Party” means any Person or entity,
governmental or otherwise, other than Seller, Buyer, and their respective
Affiliates and includes other working interest owners, royalty owners, lease
operators, landowners, service contractors and governmental agencies;

(x)all rights to consent by, required notices to, filings with, or other actions
by Governmental Authorities in connection with the sale or conveyance of oil,
gas or other mineral leases or interests in them that are customarily obtained
or made subsequent to such sale or conveyance;

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(xi)the presence of production sales contracts; division orders; contracts for
sale, purchase, exchange, refining or processing of Hydrocarbons; unitization
and pooling designations, declarations, orders and agreements; operating
agreements; agreements of development; area of mutual interest agreements; gas
balancing or deferred production agreements; processing agreements; plant or
compression agreements; pipeline, gathering and transportation agreements;
injection, repressuring and recycling agreements; carbon dioxide purchase or
sale agreements; salt water or other disposal agreements; seismic or geophysical
permits or agreements; and any and all other agreements that have terms that are
ordinary and customary to the oil, gas, sulphur and other mineral exploration,
development, processing or extraction business or in the business of processing
of gas and gas condensate or liquids production for the extraction of products
from them;

(xii)farmout or farmin agreements, to the extent they do not reduce the Net
Revenue Interests of Seller below those set forth in Exhibit B or increase the
Working Interests of Seller above those set forth in Exhibit B without a
corresponding increase in the Net Revenue Interests;

(xiii)liens and security interests that will be released at Closing as provided
in Section 12.04(g);

(xiv)rights reserved to or vested in any Governmental Authority to control or
regulate any of the Assets and the applicable Law;

(xv)all defects and irregularities affecting the Assets that, individually or in
the aggregate, (A) do not operate to (1) reduce the Net Revenue Interests of
Seller, (2) increase the proportionate share of costs and expenses of leasehold
operations attributable to or to be borne by the Working Interests of Seller, or
(3) otherwise interfere materially with the operation, value or use of the
Assets; (B) operate to increase the proportionate share of costs and expenses of
leasehold operations attributable to or to be borne by the Working Interest of
Seller, so long as there is a proportionate increase in Seller's Net Revenue
Interests; or (C) that would not be considered material when applying general
industry standards;

(xvi)Gas Imbalances associated with the Assets;

(xvii)any lien or trust arising in connection with workers' compensation,
unemployment insurance, pension, employment, or child support laws or
regulations;

(xviii)rights of any owners or lessees of any oil and gas interests in
formations, strata, horizons or depths other than the formations, strata,
horizons or depths included in the Assets;

(xix)the terms and provisions of the oil, gas and/or mineral leases covering or
affecting any fee mineral and royalty interests included in the Assets in
accordance with Section 4.05(e);

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(xx)all Title Defects expressly waived by Buyer in writing or that have been
deemed to have been waived or not otherwise to be Title Defects under Section
4.04(a) or Section 4.05(d) or any other provision of this Agreement; and

(xxi)Title Defects that are defensible by possession under applicable statutes
of limitation for adverse possession or for prescription.

Section 4.03Title Defect. The term “Title Defect,” as used in this Agreement,
means any encumbrance, encroachment, irregularity, defect in or objection to
Seller's ownership of any Asset (excluding Permitted Encumbrances) that causes
Seller not to have Defensible Title to that Asset. Notwithstanding any other
provision in this Agreement to the contrary, the following matters shall not
constitute, and shall not be asserted as a Title Defect or a breach of Seller's
special warranty of title in the Assignment: (a) defects or irregularities
arising out of a lack of evidence of, or other defects with respect to,
authorization, execution, delivery or acknowledgment of documents, or a
variation in name, unless Buyer provides affirmative evidence that such matter
results in another Person's superior claim of title to the relevant Asset;
(b) defects or irregularities that have been cured or remedied by the passage of
time, including applicable statutes of limitation and statutes for prescription
or preemption; (c) defects or irregularities in the chain of title consisting of
the failure to recite marital status in documents or omissions of heirship
proceedings, unless Buyer provides reasonable evidence that such failure has
resulted in another Person's superior claim of title; (d) defects or
irregularities in title which for a period of seven (7) years or more have not
delayed or prevented Seller (or Seller's predecessor, if owned by Seller less
than seven (7) years) from receiving Seller's Net Revenue Interest share of the
proceeds of production and have not caused Seller to bear a share of expenses or
costs greater than Seller's Working Interest share from any Lease, unit or well;
(e) defects or irregularities resulting from or related to probate proceedings
or the lack of probate proceedings if the defects or irregularities have been
outstanding for seven (7) years or more, unless Buyer provides reasonable
evidence that such failure has resulted in another Person's superior claim of
title; (f) conventional rights or reassignment normally actuated by an intent to
abandon or release a Lease and requiring notice to the holders of such rights;
(g) lack of a survey, unless a survey is required by Law; (h) any failure of the
records of any Person to reflect sufficient production or operations to maintain
a Lease in force and effect prior to 2006 absent reasonable evidence that such
failure has caused such Lease to terminate or would result in a termination of
such Lease pending only action by the lessor under such Lease; (i) matters based
solely on assertions that Seller's (or the applicable operator's) files lack
information (including title opinions); (j) failure of the records of any
Governmental Authority (including the United States Bureau of Land Management)
to reflect Seller as the owner of an interest in a Lease, provided that the
instruments evidencing a chain of title of such interest to Seller are recorded
in the real property records of the applicable county; (k) failure to record
Leases issued by the United States Bureau of Land Management, the State of New
Mexico or any other Governmental Authority in the real property records of the
county in which such Leases are located; provided that (i) such Leases are
recorded with the United States Bureau of Land Management, the State of New
Mexico or such other Governmental Authority, as applicable, and (ii) the
instruments evidencing the chain of title to Seller with respect to such Leases
are recorded in the real property, conveyance, or other records of the
applicable county; (l) unreleased instruments executed prior to the year 2002
(including prior oil, gas and/or mineral leases and mortgages) absent reasonable
evidence that such instruments continue in force and effect and constitute a

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superior claim of title to or valid lien on an Asset; (m) calls on oil and/or
gas production under existing Contracts, provided that the holder of such right
must pay an indexed-based price for any production purchased by virtue of such
call on production; or (n) any defect or irregularity as would normally be
waived by Persons engaged in the oil and gas business when purchasing producing
properties.

Section 4.04Notice of Title Defects.

(a) If Buyer discovers any alleged Title Defect affecting any Asset, Buyer shall
notify Seller of the alleged Title Defect as promptly as possible, but no later
than the expiration of the Examination Period. To be effective, this notice (a
“Title Defect Notice”) must (i) be in writing; (ii) be received by Seller prior
to the expiration of the Examination Period; (iii) describe the Title Defect in
sufficient, specific detail (including any alleged variance in the Net Revenue
Interest or Working Interest); (iv) include copies of documents necessary for
Seller to verify the existence of the alleged Title Defect, (v) identify the
specific Asset or Assets affected by the Title Defect; and (vi) include the
Title Defect Value as determined by Buyer. Any matters that otherwise may have
constituted Title Defects, but that are not so described in a timely Title
Defect Notice complying and delivered in accordance with this Section 4.04(a),
shall be deemed to have been waived by Buyer for all purposes and shall
constitute Permitted Encumbrances.

(b)After receipt of an effective Title Defect Notice, Seller shall have the
option, but not the obligation, to attempt to cure the Title Defect at any time
prior to the Closing and to postpone the Closing Date up to thirty (30) days
beyond the date set forth in Section 12.01 to facilitate the cure.

(c)The value attributable to each Title Defect (the “Title Defect Value”) that
is asserted by Buyer in a Title Defect Notice shall be determined in good faith
based upon the criteria set forth below:
(i)If the Title Defect is a lien on any Asset, the Title Defect Value is the
amount necessary to be paid to remove the lien from the affected Asset.

(ii)If the Title Defect asserted is that the Net Revenue Interest attributable
to any well, unit, well location or Lease is less than that stated in Exhibit B
or the Working Interest attributable to any well, unit or well location is
greater than that stated in Exhibit B, then the Title Defect Value shall take
into account the relative change in the interest from Exhibit B and the
appropriate Allocated Value of such Asset. For purposes of this Agreement, the
term “Allocated Value” means, with respect to any Asset, the amount allocated to
that Asset under Section 11.01.

(iii)If the Title Defect represents an obligation, encumbrance, burden or charge
on the affected Asset (including any increase in Working Interest for which
there is not a proportionate increase in Net Revenue Interest) for which the
economic detriment to Buyer is unliquidated, the amount of the Title Defect
Value shall be determined by taking into account the Allocated Value of the
affected Asset, the portion of the Asset affected by the Title Defect, the legal

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effect of the Title Defect, the potential discounted economic effect of the
Title Defect over the life of the affected Asset and the Title Defect Value
placed upon the Title Defect by Buyer and Seller.

(iv)If a Title Defect is not in effect or does not adversely affect an Asset
throughout the entire productive life of such Asset, the consequences of that
fact shall be taken into account in determining the Title Defect Value.

(v)The Title Defect Value of a Title Defect shall be determined without
duplication of any costs or losses included in another Title Defect Value. For
example, if a lien which constitutes a Title Defect affects more than one Asset
or the curative work with respect to one Title Defect results (or is reasonably
expected to result) in the curing of any other Title Defect affecting the same
or another Asset, the amount necessary to discharge such lien or the cost and
expense of such curative work shall be allocated among the Assets so affected
(in the ratios of the respective portions of the Allocated Values of such
Assets) and the amount so allocated to a Title Defect Property shall be included
only once in the Title Defect Value.

(vi)Notwithstanding anything in this Agreement to the contrary, in no event
shall a Title Defect Value exceed the Allocated Value of the wells, units, well
locations or other Assets affected by it.

(vii)To give Seller an opportunity to commence reviewing possible Title Defects,
Buyer shall use reasonable efforts to give Seller, on or before 5:00 p.m.
Central Time each Friday prior to the expiration of the Examination Period,
notice of all Title Defects discovered by Buyer during the preceding week, which
notice may be preliminary in nature and supplemented prior to the expiration of
the Examination Period.

Section 4.05Remedies for Title Defects.

(a)Subject to the continuing right of Seller to dispute the existence of an
asserted Title Defect and/or the asserted Title Defect Value and subject to the
rights of the Parties under Section 13.01(f), if any Title Defect timely
asserted by Buyer in accordance with Section 4.04(a) is not waived in writing by
Buyer or cured on or before Closing, Seller shall, at Seller's sole option,
elect to:

(i)subject to Section 4.05(d), reduce the Purchase Price by the Title Defect
Value for the Title Defect as determined in accordance with Section 4.04(c) or
Article XVIII (which shall cause such asserted Title Defect to become an Assumed
Obligation under Section 16.02);

(ii)indemnify Buyer against all claims resulting from the Title Defect (an
“Indemnified Title Defect”) pursuant to an indemnity agreement (the “Title
Indemnity Agreement”) in the form attached to this Agreement as Exhibit D;
provided, however, that without Buyer's consent, Seller shall not be entitled to
elect to indemnify Buyer under this Section 4.05(a)(ii) for any Title Defect
that is

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a discrepancy in the Net Revenue Interest and/or Working Interest of a well,
unit, well location or Lease (as compared to the Net Revenue Interest and/or
Working Interest set forth in Exhibit B with respect to such Asset); or

(iii)retain the entirety of the Asset that is subject to the Title Defect,
together with all associated Assets, in which event the Purchase Price shall be
reduced by an amount equal to the Allocated Value of the Asset and the
associated Assets.

(b)If any Title Defect is in the nature of an unobtained consent to assignment
or other restriction on assignability, the provisions of Section 4.08 shall
apply.

(c)If at or before the Closing Buyer and Seller have not agreed on the validity
of any asserted Title Defect or the Title Defect Value attributable to the Title
Defect and Seller has not elected to indemnify Buyer with respect to the Title
Defect under Section 4.05(a)(ii) or to retain the Assets associated with the
Title Defect under Section 4.05(a)(iii), Buyer or Seller shall have the right to
elect to have the Dispute regarding the validity of the Title Defect or the
Title Defect Value determined by an Independent Expert in accordance with
Article XVIII. In that event, the Purchase Price paid at Closing shall not be
reduced by virtue of the disputed Title Defect or Title Defect Value, but upon
the final resolution of the Dispute, the Title Defect Value, if any, found to be
attributable to the Title Defect shall, subject to Section 4.05(d), be refunded
by Seller to Buyer within three (3) Business Days of such resolution.

(d)Notwithstanding anything to the contrary in this Agreement, but subject to
Section 4.05(e), (i) if the value of a particular individual Title Defect (or
individual Title Benefit, except for an Asset on which there is a Title Defect
exceeding $40,000) does not exceed $40,000, then it shall be deemed to be a
Permitted Encumbrance and no adjustment to the Purchase Price shall be made or
other remedies provided by Seller for the Title Defect (or Title Benefit),
(ii) if the aggregate adjustment to the Purchase Price determined in accordance
with this Agreement for Title Defects (after taking into account clause (i))
does not exceed two percent (2%) of the Unadjusted Purchase Price prior to any
other adjustments, then they shall be deemed to be Permitted Encumbrances and no
adjustment of the Purchase Price shall be made or other remedies provided by
Seller on account of Title Defects, and (iii) if the aggregate adjustment to the
Purchase Price determined in accordance with this Agreement for Title Defects
(after taking into account clause (i)) does exceed two percent (2%) of the
Unadjusted Purchase Price prior to any other adjustments, then the Purchase
Price shall be adjusted only by the amount of the excess and no other adjustment
of the Purchase Price shall be made or other remedies provided by Seller on
account of Title Defects.

(e)Notwithstanding the provisions of Section 4.05(d) and the other provisions of
this Agreement, in the event Buyer asserts a Title Defect as a result of
Seller's Net Revenue Interest in any well, unit, well location or Lease being
less than that stated in Exhibit B and Seller owns a fee mineral, royalty or
other similar non-leasehold oil, gas or other mineral interest in such well,
unit, well location or Lease, then (i) the Assets shall be deemed to include
such fee mineral, royalty or other similar non-leasehold oil,

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gas or other mineral interest; (ii) such fee mineral, royalty or other similar
non-leasehold oil, gas or other mineral interest shall be conveyed by Seller to
Buyer at the Closing; (iii) to the extent the inclusion of such fee mineral,
royalty or other similar non-leasehold oil, gas or other mineral interest
eliminates such Net Revenue Interest deficiency, the deficiency shall not
constitute a Title Defect; and (iv) to the extent the inclusion of such fee
mineral, royalty or other similar non-leasehold oil, gas or other mineral
interest in the Assets results in Seller's Net Revenue Interest being greater
than that stated in Exhibit B, the excess shall constitute a Title Benefit.

Section 4.06Special Warranty of Title. The documents to be executed and
delivered by Seller to Buyer transferring title to the Assets as required
hereby, including the Assignment and Bill of Sale attached hereto as Exhibit C
(the “Assignment”), shall provide for a special warranty of title warranting
title by, through and under Seller, but not otherwise, subject to the Permitted
Encumbrances and the terms of this Agreement. Buyer's remedy for breach of
Seller's special warranty of title in the Assignment shall be limited to an
amount not exceeding the Allocated Value of the affected Asset, and any claims
for such breach must be asserted within eighteen (18) months from the Closing
Date. Any such claims not asserted within such eighteen (18) month period shall
be deemed to be Assumed Obligations.

Section 4.07Preferential Rights To Purchase.

(a)Seller shall use reasonable efforts, but without any obligation to incur any
additional cost or expense, to comply with all preferential right to purchase
provisions relative to any Asset (“PPRs”) prior to the Closing. Prior to the
Closing, Seller shall notify Buyer of the existence of any known PPRs and if any
PPRs are exercised or if the requisite period has elapsed without said rights
having been exercised.

(b)If, as of the Closing Date, a Third Party holder of a PPR has timely and
properly notified Seller that it elects to exercise its PPR with respect to the
Assets to which its PPR applies (determined by and in accordance with the
agreement in which the PPR arises), then the Assets covered by that PPR will be
sold to such holder of the PPR subject to the terms and conditions of this
Agreement, and will not be sold to the Party originally executing this Agreement
as “Buyer” (subject to the remaining provisions in this Article), and the
Unadjusted Purchase Price will be reduced by the Allocated Value of such Assets.
Buyer shall remain obligated to purchase the remainder of the Assets not
affected by an exercised PPR. Upon the consummation of the sale of any Assets to
the holder of such PPR, any such Assets shall be deemed for all purposes to
constitute “Excluded Assets”.

(c)After the Closing, if for any reason the purchase and sale of the Assets
covered by a PPR exercised prior to Closing under (b) above is not or cannot be
consummated with the holder of the PPR that exercised its PPR, Seller may so
notify Buyer and within ten (10) Business Days after Buyer's receipt of such
notice, Seller shall sell, assign and convey to Buyer and Buyer shall purchase
and accept from Seller such Assets pursuant to the terms of this Agreement and
for the Allocated Value of such Assets (except the Closing Date with respect to
such Assets will be the date of assignment of such Assets from Seller to Buyer).

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(d)Any interest in the Assets covered by any unexercised PPRs (whether due to
the PPR notice period or otherwise) shall be conveyed to Buyer at the Closing
subject to any PPRs, and Buyer shall assume all duties, obligations and
liabilities arising from the PPR. Without limiting the foregoing, if any Third
Party elects to purchase all or a part of an interest in any Asset subject to a
PPR after the Closing Date, Buyer shall be obligated to convey that interest to
that Third Party and shall be entitled to the consideration for the sale of that
interest.

Section 4.08Consents to Assignment. Seller shall use reasonable efforts to
obtain all necessary consents from Third Parties to assign the Assets prior to
the Closing (other than approvals of any relevant Governmental Authority that
are customarily obtained after the Closing), and Buyer shall assist Seller with
those efforts; provided, however, Seller shall not be obligated to pay any
consideration to (or incur any cost or expense for the benefit of) the holder of
the consent in order to obtain a waiver or consent. To the extent any such
consents are not obtained prior to Closing and an express provision of the
document providing for the consent would render the assignment of some or all of
the Assets void or voidable, give rise to a claim for specified liquidated
damages or cause the termination of the Lease or other Asset to be assigned as a
result of the failure to obtain that consent, then that failure shall constitute
a Title Defect as to the portion of the Assets affected thereby, and the
provisions of Section 4.05(a) shall apply thereto. In all other cases, such
unobtained consents shall not constitute Title Defects.

Section 4.09Title Benefits; Remedies.

(a)If any Party discovers any Title Benefit during the Examination Period
affecting the Assets, it shall promptly notify the other Parties at or before
the expiration of the Examination Period. Subject to Section 4.05(d), Seller
shall be entitled to an upward adjustment to the Purchase Price pursuant to
Section 12.02(a)(iii) with respect to the Title Benefit, in an amount mutually
agreed upon by the Parties. For purposes of this Agreement, the term “Title
Benefit” means the Seller's interest in any Asset that is greater than or in
addition to that set forth in Exhibit B, including a Net Revenue Interest that
is greater than that set forth in Exhibit B or Seller's Working Interest in any
Asset that is less than the Working Interest set forth in Exhibit B (without a
corresponding decrease in the Net Revenue Interest).

(b)If, with respect to a Title Benefit, Buyer and Seller have not agreed on the
amount of the upward Purchase Price Adjustment or have not otherwise agreed on
such amount at or prior to the Closing, Seller or Buyer shall have the right to
elect to have the Dispute regarding the Purchase Price Adjustment determined by
an Independent Expert in accordance with Article XVIII. In that event, Buyer
shall pay the undisputed portion of the Purchase Price with respect to the Asset
affected by the Title Benefit at the Closing and, subject to Section 4.05(d),
upon determination of the amount of the adjustment, shall pay to Seller any
unpaid portion within three (3) Business Days of such determination.

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Article V
Environmental Matters

Section 5.04Environmental Review.

(a)Buyer shall have the right to conduct or cause a consultant reasonably
acceptable to Seller (“Buyer's Environmental Consultant”) to conduct an
environmental review of the Assets prior to the expiration of the Examination
Period (“Buyer's Environmental Review”). The cost and expense of Buyer's
Environmental Review, if any, shall be borne solely by Buyer. The scope of work
comprising Buyer's Environmental Review shall be limited to a Phase I review and
otherwise as may be agreed by Buyer and Seller prior to commencement. The
Environmental Review shall not include any intrusive test or procedure without
the prior written consent of Seller, which consent will not be unreasonably
withheld. Buyer shall, and shall cause Buyer's Environmental Consultant to, (i)
consult with Seller before conducting any work comprising Buyer's Environmental
Review, (ii) perform all such work in a safe and workmanlike manner and so as to
not unreasonably interfere with the operation of the Assets and (iii) comply
with all applicable Law. Buyer shall be solely responsible for obtaining any
consents from a Third Party that are required to perform any work comprising
Buyer's Environmental Review, and Buyer shall consult with Seller prior to
requesting each such consent. Seller shall have the right to have a
representative or representatives accompany Buyer and Buyer's Environmental
Consultant at all times during Buyer's Environmental Review. With respect to any
samples taken in connection with Buyer's Environmental Review, Buyer shall take
split samples, providing one of each such sample, properly labeled and
identified, to Seller without charge. Buyer releases, and shall defend,
indemnify and hold harmless, Seller Indemnitees from and against all claims,
losses, damages, costs, expenses, causes of action and judgments of any kind or
character (INCLUDING THOSE RESULTING FROM SELLER'S SOLE, JOINT, COMPARATIVE OR
CONCURRENT NEGLIGENCE OR STRICT LIABILITY, BUT SPECIFICALLY EXCLUDING THOSE
RESULTING FROM SELLER'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT) arising out of
or relating to Buyer's Environmental Review. The indemnity and other obligations
set forth in the immediately preceding sentence shall survive the Closing or
termination of this Agreement.

(b)Unless otherwise required by applicable Law, Buyer shall, and shall cause
Buyer's Environmental Consultant to, treat confidentially any matters revealed
by Buyer's Environmental Review and any reports or data generated from such
review (the “Environmental Information”), and Buyer shall not, and shall cause
Buyer's Environmental Consultant to not, disclose any Environmental Information
to any Governmental Authority or other Third Party without the prior written
consent of Seller. Buyer may use the Environmental Information only in
connection with the transactions contemplated by this Agreement. If Buyer,
Buyer's Environmental Consultant or any Third Party to which Buyer has provided
any Environmental Information become legally compelled to disclose any of the
Environmental Information, Buyer shall provide Seller with prompt notice
sufficiently prior to any such disclosure so as to allow Seller to file any
protective order or seek any other remedy, as Seller deems appropriate under the

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circumstances. Buyer shall provide to Seller copies of any Environmental
Information generated by Buyer or Buyer's Environmental Consultant promptly
after Buyer's receipt thereof. If this Agreement is terminated prior to the
Closing, Buyer shall promptly deliver the Environmental Information to Seller,
which Environmental Information shall become the sole property of Seller without
charge. The confidentiality and other obligations set forth in this paragraph
shall survive the termination of this Agreement.

Section 5.02Environmental Definitions.

(a)Assumed Environmental Obligations. For purposes of this Agreement, the term
“Assumed Environmental Obligations” means, with respect to Seller's ownership of
the Assets, the operation of the Assets or the condition of the Assets and any
surface or subsurface depths used in connection with the Assets, including any
pooled, communitized or unitized acreage by virtue of the Assets being a part of
the pooled, communitized or unitized area (collectively, the “Subject
Property”), all liabilities, losses, claims, obligations, costs or expenses
arising from or relating to the following: (i) any violation or alleged
violation of, or non-compliance with applicable Environmental Law prior to, on,
or after the Effective Time, including the cost of correcting such violations or
noncompliance and any fines or penalties arising out of such violations or
noncompliance; (ii) the release, discharge or disposal of Hazardous Substances
prior to, on, or after the Effective Time, at, on, in, under, from or migrating
to or from the Subject Property, including claims for property damage, loss,
injury, damage to natural resources, bodily injury or wrongful death, and any
investigation, remediation or monitoring with respect to said Hazardous
Substances; (iii) any Environmental Defects that are not Indemnified
Environmental Defects; or (iv) those matters that would otherwise be
Environmental Defects but for the provisions of Section 5.04(c).

(b)Environmental Defects. For purposes of this Agreement, the term
“Environmental Defect” means, with respect to any given Asset, an individual
environmental condition identified with specificity in Buyer's Environmental
Review that constitutes a material violation of Environmental Laws in effect as
of the date of this Agreement in the jurisdiction in which the affected Asset is
located, excluding, however any environmental conditions (i) deemed not to be
Environmental Defects by application of Section 5.04(c), or (ii) relating to
asbestos or NORM as described in Section 5.07.

(c)Environmental Defect Value. For purposes of this Agreement, the term
“Environmental Defect Value” means, with respect to any Environmental Defect,
the value, as of the Closing Date, of the estimated costs and expenses to
correct the Environmental Defect in the most cost-effective manner reasonably
available, consistent with Environmental Laws, taking into account that
non-permanent remedies (such as mechanisms to contain or stabilize hazardous
materials, including monitoring site conditions, natural attenuation, risk-based
corrective action, institutional controls or other appropriate restrictions on
the use of property, caps, dikes, encapsulation, leachate collection systems,
etc.) may be the most cost-effective manner reasonably available. The
Environmental Defect Value of an Environmental Defect shall be determined
without duplication of any costs or losses included in another Environmental
Defect Value. For example, if a matter which constitutes an Environmental Defect
affects more than one

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Asset or the curative work with respect to one Environmental Defect results (or
is reasonably expected to result) in the curing of any other Environmental
Defect affecting the same or another Asset, the amount of such curative work
shall be allocated among the Assets so affected (in the ratios of the respective
portions of the Allocated Values of such Assets) and the amount so allocated
shall be included only once in the Environmental Defect Value.

(d)Environmental Laws. For purposes of this Agreement, the term “Environmental
Laws” means all Laws pertaining to health (as relates to exposure to Hazardous
Substances) or the environment, including the Clean Air Act, as amended, the
Comprehensive Environmental Response, Compensation and Liability Act, as
amended, the Federal Water Pollution Control Act, as amended, the Resources
Conservation and Recovery Act, as amended, the Safe Drinking Water Act, as
amended, the Toxic Substances Control Act, as amended, the Superfund Amendment
and Reauthorization Act of 1986, as amended, the Hazardous Materials
Transportation Act, as amended, and comparable state and local laws.

(e)Hazardous Substances. For purposes of this Agreement, the term “Hazardous
Substances” means (i) any petrochemical or petroleum products, oil or coal ash,
radioactive materials, radon gas, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation and transformers or other equipment
that contain dielectric fluid which may contain levels of polychlorinated
biphenyls, (ii) any chemicals, materials, or substances defined as or included
in the definition of “hazardous substances,” “hazardous wastes,” “restricted
hazardous materials,” “extremely hazardous substances,” “toxic substances,”
“contaminants” or “pollutants” or words of similar meaning and regulatory effect
or (iii) any other chemical, material or substance, exposure to which is
prohibited, limited or regulated by any applicable Environmental Law.

(f)Indemnified Environmental Defects. For purposes of this Agreement, the term
“Indemnified Environmental Defect” means an Environmental Defect as to which
Seller has elected to indemnify Buyer in accordance with Section 5.04(a)(ii).

Section 5.03Notice of Environmental Defects. If Buyer discovers any
Environmental Defect affecting any Asset, Buyer shall notify Seller of the
alleged Environmental Defect as promptly as possible, but no later than the
expiration of the Examination Period. To be effective, this notice (an
“Environmental Defect Notice”) must (i) be in writing; (ii) be received by
Seller prior to the expiration of the Examination Period; (iii) describe the
Environmental Defect in sufficient, specific detail, including (A) the written
conclusion of Buyer's Environmental Consultant that an Environmental Defect
exists, which conclusion shall be reasonably substantiated by the factual data
gathered in Buyer's Environmental Review; and (B) a separate specific citation
of the provisions of Environmental Laws alleged to be violated and the related
facts that substantiate such violation; (iv) identify the specific Asset or
Assets affected by the Environmental Defect, including a site plan showing the
location of all sampling events, boring logs and other field notes describing
the sampling methods utilized and the field conditions observed,
chain-of-custody documentation and laboratory reports; (v) identify the
procedures recommended to correct the Environmental Defect, together with any
related recommendations from Buyer's Environmental Consultant; and (vi) state
Buyer's estimate of the Environmental

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Defect Value, including the basis for such estimate, for which Buyer would agree
to adjust the Purchase Price to accept such Environmental Defect if Seller
elected Section 5.04(a)(i) as the remedy for it. Any matters that may otherwise
have constituted Environmental Defects, but that are not so described in a
timely Environmental Defect Notice complying with this Section 5.03, together
with any environmental matter that does not constitute an Environmental Defect,
shall be deemed to have been waived by Buyer for all purposes and constitute an
Assumed Obligation. After receipt of an effective Environmental Defect Notice,
Seller shall have the option, but not the obligation, to attempt to cure the
Environmental Defect at any time prior to the Closing and to postpone the
Closing Date up to thirty (30) days beyond the date set forth in Section 12.01
to facilitate the cure.

Section 5.04Remedies for Environmental Defects.

(a)Subject to the continuing right of Seller to dispute the existence of an
asserted Environmental Defect and/or the asserted Environmental Defect Value and
subject to the rights of the Parties under Section 13.01(f), if any
Environmental Defect timely asserted by Buyer in accordance with Section 5.03 is
not waived in writing by Buyer or cured on or before Closing, Seller shall, at
Seller's sole option, elect to:

(i)subject to Section 5.04(c), reduce the Purchase Price by the Environmental
Defect Value for the Environmental Defect as determined in accordance with
Section 5.02(c) or Article XVIII (which shall cause such alleged Environmental
Defect to become an Assumed Obligation under Section 16.02);

(ii)indemnify Buyer against all claims resulting from the Environmental Defect
pursuant to an indemnity agreement (the “Environmental Indemnity Agreement”) in
the form attached to this Agreement as Exhibit E; or

(iii)retain the entirety of the Asset that is subject to such Environmental
Defect, together with all associated Assets, in which event the Purchase Price
shall be reduced by an amount equal to the Allocated Value of the Asset and the
associated Assets.

(b)If at or before the Closing Buyer and Seller have not agreed on the validity
of any asserted Environmental Defect or the Environmental Defect Value
attributable to the Environmental Defect and Seller has not elected to indemnify
the Buyer with respect to the Environmental Defect under Section 5.04(a)(ii) or
to retain the Assets associated with the Environmental Defect under Section
5.04(a)(iii), Buyer or Seller shall have the right to elect to have the Dispute
regarding the validity of the Environmental Defect or the Environmental Defect
Value determined by an Independent Expert in accordance with Article XVIII. In
that event, the Purchase Price paid at Closing shall not be reduced by virtue of
the disputed Environmental Defect or Environmental Defect Value, but on the
final resolution of the Dispute the Environmental Defect Value, if any, found to
be attributable to the Environmental Defect shall, subject to Section 5.04(c),
be refunded by Seller to Buyer within three (3) Business Days of such
resolution.

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(c)Notwithstanding anything to the contrary in this Agreement (i) if the
Environmental Defect Value for a particular individual Environmental Defect does
not exceed $40,000, then no adjustment to the Purchase Price shall be made for
the Environmental Defect, (ii) if the aggregate adjustment to the Purchase Price
determined in accordance with this Agreement for Environmental Defects
(exceeding $40,000) does not exceed two percent (2%) of the Unadjusted Purchase
Price prior to any other adjustments, then no adjustment of the Purchase Price
shall be made on account of Environmental Defects, and (iii) if the aggregate
adjustment to the Purchase Price determined in accordance with this Agreement
for Environmental Defects (exceeding $40,000) does exceed two percent (2%) of
the Unadjusted Purchase Price prior to any other adjustments, then the Purchase
Price shall be adjusted only by the amount of the excess.

Section 5.05No Warranty Regarding Environmental Matters. SELLER WILL CONVEY THE
ASSETS TO BUYER WITHOUT ANY WARRANTY OF ANY KIND WITH RESPECT TO ENVIRONMENTAL
MATTERS OR ENVIRONMENTAL DEFECTS, EXPRESS, STATUTORY OR IMPLIED, NOT EVEN FOR
RETURN OF THE PURCHASE PRICE. BUYER'S SOLE REMEDY FOR ENVIRONMENTAL DEFECTS OR
OTHER ENVIRONMENTAL MATTERS IS THE ENVIRONMENTAL DEFECT PROCEDURE UNDER THIS
ARTICLE V.

Section 5.06Physical Condition of the Assets. Buyer acknowledges that the Assets
have been used by Seller for oil and gas drilling and production operations and
related field operations, and that physical changes in the Assets (or adjacent
lands) may have occurred as a result of those uses. In this regard, the Assets
may also contain unplugged or improperly plugged wells, wellbores or buried
pipelines or other equipment, whether or not of a similar nature, the locations
of which may not now be known by Seller or be readily apparent by a physical
inspection of the property. Buyer understands that Seller does not have the
requisite information with which to determine the exact condition of the Assets
or the effect that any such use has had on the physical condition of the Assets,
and Seller does not make any representation or warranty with respect to those
matters and Buyer expressly assumes all liability for those matters (INCLUDING
THOSE RESULTING FROM SELLER'S SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE
OR STRICT LIABILITY).

Section 5.07NORM. Buyer acknowledges that some oilfield production equipment
comprising the Assets may contain asbestos and/or naturally occurring
radioactive material (“NORM”). In this regard, Buyer specifically acknowledges
that NORM may affix or attach itself to the inside of wellbores, materials and
equipment as scale or in other forms, and that wells, materials and equipment
comprising the Assets or located on a Lease may contain NORM and that NORM
containing materials may have been disposed of on a Lease. Buyer expressly
understands that special procedures may be required for the removal and disposal
of asbestos and NORM from the Assets if and where they may be found, and Buyer
assumes Seller's liability for or in connection with the assessment,
remediation, removal, transportation or disposal of any such materials present
on the Assets at or after the Effective Time in accordance with all requirements
of any Governmental Authority (INCLUDING THOSE RESULTING FROM SELLER'S SOLE,
JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE OR STRICT LIABILITY).

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Article VI
Representations and Warranties of Seller

Inclusion of a matter on a Schedule to a representation or warranty which
addresses matters possibly having a Material Adverse Effect shall not be deemed
an indication that such matter does, or may, have a Material Adverse Effect.
Likewise, the inclusion of a matter on a Schedule in relation to a
representation or warranty shall not be deemed an indication that such matter
necessarily would, or may, breach such representation or warranty absent its
inclusion on such Schedule. Matters may be disclosed on a Schedule or Exhibit to
this Agreement for purposes of information only. Nothing in the Schedules of
Seller is intended to broaden the scope or effect of any representation or
warranty contained in the Agreement. Nothing in the Schedules constitutes an
admission of any liability or obligation to any third person, or an admission to
any third person against the interest of Seller. Descriptions of or references
to particular contracts, agreements, notices and other documents herein are
qualified in their entirety by reference to such documents. Certain sections of
the Agreement may be qualified by the matters set forth in the related Schedule,
and the disclosure of any fact or item in any of the Schedules shall, should the
existence of such fact or item be relevant to any other of the Schedules or
sections in the Agreement, be deemed to be disclosed with respect to that other
section or Schedule. In disclosing information pursuant to the Schedules, Seller
does not waive any attorney-client privilege associated with such information or
any protection afforded by the work-product doctrine. Subject to the foregoing,
the disclaimers and waivers contained herein and the other terms and conditions
of this Agreement, Seller represents and warrants to Buyer that:

Section 6.04Seller's Existence. COG is a limited liability company duly formed,
validly existing and in good standing under the laws of the State of Delaware,
and has full legal power, right and authority to carry on its business as such
is now being conducted and as contemplated to be conducted. Concho LLC is a
limited liability company duly formed, validly existing and in good standing
under the laws of the State of Texas, and has full legal power, right and
authority to carry on its business as such is now being conducted and as
contemplated to be conducted.

Section 6.02Legal Power. Seller has the legal power and right to enter into and
perform this Agreement and the transactions it contemplates for Seller. The
consummation of the transactions contemplated by this Agreement will not
violate, or be in conflict with:

(a)any provision of Seller's charter and operating agreement or other governing
documents; or

(b)any judgment, order, ruling or decree applicable to Seller as a party in
interest or any Law applicable to Seller's interest in any of the Assets, except
(i) as would not, individually or in the aggregate, have a Material Adverse
Effect, or (ii) as to rights to consent by, required notices to, filings with,
approval or authorizations of, or other actions by any Governmental Authorities
where the same are not required prior to the assignment of the related Asset or
they are customarily obtained subsequent to the sale or conveyance thereof.

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Section 6.03Execution. The execution, delivery and performance of this Agreement
and the transactions it contemplates for Seller are duly and validly authorized
by the requisite limited liability company action, as applicable, on the part of
Seller. This Agreement has been duly executed and delivered by Seller (and all
documents this Agreement requires be executed and delivered by Seller at Closing
will be duly executed and delivered by Seller) and this Agreement constitutes,
and at the Closing those other documents will constitute, the valid and binding
obligations of Seller, enforceable against Seller in accordance with their terms
except as such enforceability may be limited by applicable bankruptcy or other
similar laws affecting the rights and remedies of creditors generally as well as
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

Section 6.04Brokers. No broker or finder is entitled to any brokerage or
finder's fee, or to any commission, based in any way on agreements, arrangements
or understandings made by or on behalf of Seller or any Affiliate of Seller for
which Buyer has or will have any liabilities or obligations (contingent or
otherwise).

Section 6.05Bankruptcy. There are no bankruptcy, reorganization, or similar
arrangement proceedings pending, being contemplated by or, to Seller's
Knowledge, threatened against Seller.

Section 6.06Proceedings. There is no suit, action, claim, investigation or
inquiry by any Person or by any administrative agency or Governmental Authority
and no legal, administrative or arbitration proceeding pending or, to Seller's
Knowledge, threatened against Seller or any Affiliate of Seller or the Assets,
or any of them, that has materially affected or will materially affect Seller's
ability to consummate the transactions contemplated by this Agreement.

Section 6.07Royalties. To Seller's Knowledge, during the Seller Ownership Period
all rentals, royalties and other payments due under the Subject Interests have
been paid in all material respects, except those amounts in suspense and where
failure to so pay would not have a Material Adverse Effect. The term “Seller
Ownership Period” means, with respect to each Asset, the period beginning on the
date Seller acquired ownership of the Asset and ending at the Effective Time.

Section 6.08Taxes. To Seller's Knowledge, during the Seller Ownership Period,
all ad valorem, property, production, severance, excise and similar taxes and
assessments based on or measured by the ownership of the Assets or the
production of Hydrocarbons or the receipt of proceeds of production that have
become due and payable have been paid in all material respects prior to becoming
delinquent, unless contested in good faith.

Section 6.09Contracts. To Seller's Knowledge, all of Seller's material Contracts
(a) are in full force and effect, and (b) Seller is not in default with respect
to any of Seller's material obligations under any of them.

Section 6.10Governmental Authorizations. Except as set forth on Schedule 6.10,
except for failures to obtain or maintain as would not, individually or in the
aggregate, have a Material Adverse Effect and to Seller's Knowledge, Seller has
obtained and is maintaining all

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material federal, state and local governmental licenses, permits, franchises,
orders, exemptions, variances, waivers, authorizations, certificates, consents,
rights, privileges and applications for any of them (the “Governmental
Authorizations”) that are presently necessary or required by Seller for Seller's
ownership and operation of the Assets as currently owned and operated by Seller
(excluding matters arising under Environmental Laws or relating to Taxes, which
are addressed exclusively under Article V and Section 6.08, respectively).

Section 6.11No Violations of Laws. To Seller's Knowledge and except as set forth
on Schedule 6.11, Seller has not violated any applicable Law (excluding
Environmental Laws and Laws relating to Taxes, which are addressed exclusively
under Article V and Section 6.08, respectively) with respect to the ownership
and operation of the Assets, except where such violations would not,
individually or in the aggregate, have a Material Adverse Effect.

Section 6.12No Prepayments. There have been no advance, take or pay or other
prepayments received by Seller with respect to Seller's interest in the Assets
that would obligate Buyer to deliver Hydrocarbon production from the Assets
after the Effective Time without receiving full payment.

Section 6.13AFE's. With respect to the joint, unit or other operating agreements
relating to the Assets, except as set forth in Schedule 6.13, there are no
outstanding calls or payments in excess of $100,000 (net to Seller's interest)
under authorities for expenditures for payments relating to the Assets which are
due or which Seller has committed to make which have not been made.

Section 6.14Litigation. There is no suit or action pending, arising out of, or
to Seller's Knowledge threatened that would have a Material Adverse Effect.

Section 6.15Suspense Accounts. To Seller's Knowledge, Schedule 6.15 sets forth a
true and complete listing, as of October 1, 2012, of all Third Party proceeds of
Hydrocarbon production attributable to the Assets operated by Seller being held
in suspense by Seller.

Section 6.16Hydrocarbon Sales Agreements. To Seller's Knowledge, except as set
forth in Schedule 6.16, there are no sales, purchase or marketing Contracts that
are currently in effect and under which Seller is a seller of Hydrocarbons
produced from the Assets that provide for a fixed price and that cannot be
cancelled at any time upon ninety (90) days (or less) prior notice.

Section 6.17Records. The Records have been maintained in the ordinary course of
Seller's business without material deletion or removal therefrom in connection
with the transactions contemplated by this Agreement.

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Article VII
Representations and Warranties of Buyer

Buyer represents and warrants to Seller that:

Section 7.04Buyer's Existence. Buyer is a limited partnership duly formed,
validly existing and in good standing under the laws of the State of Delaware,
and is qualified to conduct business and in good standing in the States in which
the Assets are located. Buyer has full legal power, right and authority to carry
on its business as such is now being conducted and as contemplated to be
conducted.

Section 7.02Legal Power. Buyer has the legal power and right to enter into and
perform this Agreement and the transactions it contemplates for Buyer. The
consummation of the transactions contemplated by this Agreement will not
violate, or be in conflict with:

(i)any provision of Buyer's partnership agreement and other governing documents;

(ii)any material agreement or instrument to which Buyer is a party or by which
Buyer is bound; or

(iii)any judgment, order, ruling or decree applicable to Buyer as a party in
interest or any Law applicable to Buyer.

Section 7.03Execution. The execution, delivery and performance of this Agreement
and the transactions it contemplates for Buyer are duly and validly authorized
by all requisite limited partnership or other action on the part of Buyer and
its general partner. This Agreement has been duly executed and delivered by
Buyer (and all documents this Agreement requires be executed and delivered by
Buyer at Closing will be duly executed and delivered by Buyer) and this
Agreement constitutes, and at the Closing those other documents will constitute,
the legal, valid and binding obligation of Buyer enforceable against Buyer in
accordance with their terms, except as such enforceability may be limited by
applicable bankruptcy or other similar laws affecting the rights and remedies of
creditors generally as well as to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

Section 7.04Brokers. No broker or finder is entitled to any brokerage or
finder's fee, or to any commission, based in any way on agreements, arrangements
or understandings made by or on behalf of Buyer or any Affiliate of Buyer for
which Seller has or will have any liabilities or obligations (contingent or
otherwise).

Section 7.05Bankruptcy. There are no bankruptcy, reorganization or arrangement
proceedings pending, being contemplated by or, to Buyer's knowledge, threatened
against Buyer or any Affiliate of Buyer.

Section 7.06Proceedings. There is no suit, action, claim, investigation or
inquiry by any Person or by any administrative agency or Governmental Authority
and no legal, administrative or arbitration proceeding pending or, to Buyer's
knowledge, threatened against

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Buyer or any Affiliate of Buyer that has materially affected or will materially
affect Buyer's ability to consummate the transactions contemplated by this
Agreement.

Section 7.07Qualifications. Buyer is now, and after the Closing shall continue
to be, qualified with all applicable Governmental Authorities to own and operate
the Assets and has, and shall maintain, all necessary bonds to own and operate
the Assets.

Section 7.08Investment. Buyer is an “accredited investor,” as that term is
defined in Regulation D of the Securities Act of 1933, as amended, and will
acquire the Assets for its own account and not with a view to a sale or
distribution in violation of the Securities Act of 1933, as amended, and the
rules and regulations under that statute, any applicable state blue sky laws or
any other applicable securities laws. Buyer understands and acknowledges that if
any of the Assets were held to be securities, they would be restricted
securities and could not be transferred without registration under applicable
state and federal securities laws or the availability of an exemption from such
registration.

Section 7.09Funds. Buyer has arranged to have available by the Closing Date
sufficient funds to enable Buyer to pay in full the Purchase Price as provided
in this Agreement and otherwise to perform its obligations under this Agreement.

Section 7.10Independent Investigation. Buyer is an experienced and knowledgeable
investor in the oil, gas and mineral resources industry that has previously
expended substantial amounts in the acquisition and development of oil, gas and
mineral properties. Prior to entering into this Agreement, Buyer was advised by
and has relied solely on its own legal, tax and other professional counsel
concerning this Agreement, the Assets and their value. Buyer is knowledgeable of
the usual and customary practices of producers such as Seller, including
reliance on the advice of experts (e.g., reservoir and facility engineers,
attorneys, tax advisors, accountants, valuation specialists and environmental
consultants), and it has had (or will have prior to the Closing) access to the
Assets, the officers and employees of Seller, and the books, records and files
of Seller relating to the Assets, and in making the decision to enter into this
Agreement and consummate the transactions contemplated by this Agreement, Buyer
has relied solely on the basis of its own independent due diligence
investigation of the Assets, upon the representations and warranties in Article
VI and upon the covenants of Seller in this Agreement, and not on any other
representations, warranties or covenants of Seller or any other Person. Except
for the representations and warranties expressly made by Seller in Article VI of
this Agreement, or in the Assignment, Buyer represents and acknowledges that (i)
there are no representations or warranties, express, statutory or implied, as to
the Assets or prospects thereof, and (ii) Buyer has not relied upon any oral or
written information provided by Seller. Without limiting the generality of the
foregoing, Buyer represents and acknowledges that Seller has made and will make
no representation or warranty regarding any matter or circumstance relating to
Environmental Laws, environmental liabilities, the release of materials into the
environment or protection of human health, safety, natural resources or the
environment or any other environmental condition of the Assets.

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Article VIII
Tax-Deferred Exchange

Section 8.04Election. At or before the Closing, Seller may elect, by notice to
Buyer, to effect a tax-deferred exchange, pursuant to section 1031 of the
Internal Revenue Code of 1986, as amended (the “Code”), of those Assets it owns
and is transferring for other qualifying properties in accordance with this
Article VIII; provided, however, that notwithstanding anything to the contrary
in this Article VIII, under no circumstances shall the consummation of the
transactions contemplated by this Agreement be delayed, directly or indirectly,
as a result of any such tax-deferred exchange.

Section 8.02Qualified Intermediary. If Seller makes a tax-deferred exchange
election under this Article VIII, Seller may elect, by notice to Buyer delivered
on or before the Closing Date, to have all or a portion of the Purchase Price
paid to a qualified intermediary.

Section 8.03Additional Costs. If Seller makes a tax-deferred exchange election
under this Article VIII, Buyer shall not be required to incur any additional
cost, liability or obligation.

Section 8.04Indemnification. If Seller makes a tax-deferred exchange election,
it shall release, indemnify, defend and hold harmless Buyer from any
responsibility or liability related to such election.

Article IX
Seller's Conditions to Close

The obligations of Seller to consummate the transaction provided for in this
Agreement are subject, at the option of Seller, to the fulfillment on or prior
to the Closing Date of each of the following conditions:

Section 9.04Representations. The representations and warranties of Buyer
contained in this Agreement shall be true and correct in all material respects
as of the date of this Agreement and on the Closing Date as though made on and
as of those dates.

Section 9.02Performance. Buyer shall have performed all material obligations,
covenants and agreements contained in this Agreement to be performed or complied
with by it at or prior to the Closing.

Section 9.03Pending Matters. No suit, action or other proceeding shall be
pending or threatened against any Party that seeks to restrain, enjoin or
otherwise prohibit the consummation of the transactions contemplated by this
Agreement; provided, however, the Closing shall proceed notwithstanding any
suits, actions or other proceedings seeking to restrain, enjoin or otherwise
prohibit consummation of the transactions contemplated hereby brought by holders
of PPRs seeking to enforce such rights with respect to the Assets. The Assets
subject to such suits, actions or other proceedings shall be excluded from the
initial Closing and treated, for purposes of this Agreement only, as though the
PPR(s) had been exercised prior to Closing pursuant to Sections 4.07(b) and
4.07(c) pending the completion of such suits, actions or other proceedings.

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Article X
Buyer's Conditions to Close

The obligations of Buyer to consummate the transaction provided for in this
Agreement are subject, at the option of Buyer, to the fulfillment on or prior to
the Closing Date of each of the following conditions:

Section 10.04Representations. The representations and warranties of Seller
contained in this Agreement shall be true and correct in all material respects
as of the date of this Agreement and on the Closing Date as though made on and
as of those dates.

Section 10.02Performance. Seller shall have performed all material obligations,
covenants and agreements contained in this Agreement to be performed or complied
with by Seller at or prior to the Closing.

Section 10.03Pending Matters. No suit, action or other proceeding shall be
pending or threatened against any Party that seeks to restrain, enjoin, or
otherwise prohibit the consummation of the transactions contemplated by this
Agreement; provided, however, the Closing shall proceed notwithstanding any
suits, actions or other proceedings seeking to restrain, enjoin or otherwise
prohibit consummation of the transactions contemplated hereby brought by holders
of PPRs seeking to enforce such rights with respect to the Assets. The Assets
subject to such suits, actions or other proceedings shall be excluded from the
initial Closing and treated, for purposes of this Agreement only, as though the
PPR(s) had been exercised prior to Closing pursuant to Sections 4.07(b) and
4.07(c) pending the completion of such suits, actions or other proceedings.

Article XI
Purchase Price Allocation and Tax Matters

Section 11.04Purchase Price Allocation. The Unadjusted Purchase Price has been
allocated among the Assets by Buyer as set forth in Exhibit B. Buyer represents
that the Allocated Values constitute reasonable and good faith allocations of
the Unadjusted Purchase Price among the Assets. Seller and Buyer agree that the
Allocated Values shall be used to compute any adjustments to the Unadjusted
Purchase Price pursuant to this Agreement.

Section 11.02Transfer Taxes. Buyer shall be responsible for the timely payment
of, and shall indemnify, defend and hold harmless Seller (and Seller's members,
managers, officers, employees and agents) from and against, all Transfer Taxes,
if any, arising out of or in connection with the transactions contemplated by
this Agreement, including any and all legal costs associated with them. Buyer
shall prepare and file when due all necessary documentation and Tax Returns with
respect to any such Transfer Taxes; provided, however, that Seller shall
cooperate with Buyer and take any action reasonably requested by Buyer which
does not cause Seller to incur any cost or inconvenience to minimize any such
Transfer Taxes. For purposes of this Agreement, the term “Transfer Taxes” means
any and all transfer Taxes (excluding Taxes measured in whole or in part by net
income), including sales, use, excise, stock, conveyance, gross receipts,
registration, business and occupation, securities transactions, real estate,
stamp,

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documentary, notarial, filing, recording, permit, license, authorization and
similar Taxes, fees, duties, levies, customs, tariffs, imposts, assessments,
obligations and charges.

Section11.03Audit Rights. Seller shall cooperate with Buyer and make available,
during normal business hours, to Buyer and its representatives prior to and
following the Closing any and all existing information and documents relating to
revenues and expenses attributable to the Assets and in the possession of Seller
(subject to the rights of Third Parties) that Buyer may reasonably require to
comply with Buyer's tax and financial reporting requirements and audits,
including any filings with any Governmental Authority and filings that may be
required by the Securities and Exchange Commission under the Securities Act of
1933 and/or the Securities Exchange Act of 1934. Seller shall also use its
reasonable efforts to enforce any audit rights that Seller may have under any
Contracts to obtain information or documents reasonably requested by Buyer or
Buyer's representatives in connection with any such reporting requirements,
audits or filings. Without limiting the generality of the foregoing, Seller will
use its commercially reasonable efforts after execution of this Agreement and
following Closing to cooperate with the independent auditors chosen by Buyer
(“Buyer's Auditor”) in connection with their audit or review of any revenue and
expense records pertaining to the Assets that Buyer or any of its Affiliates
requires to comply with their tax, financial and other reporting requirements.
Seller's cooperation will include (i) reasonable access during normal business
hours to Seller's employees and representatives designated by Seller who were
responsible for preparing or maintaining the revenue and expense records and
work papers and other supporting documents used in the preparation of such
financial statements as may be required by Buyer's Auditor to perform an audit
or conduct a review in accordance with generally accepted auditing standards or
to otherwise verify such financial statements; and (ii) delivery of one or more
customary representation letters from Seller to Buyer's Auditor that are
reasonably requested by Buyer to allow such auditors to complete an audit (or
review of any financial statements), and to allow Buyer's Auditor to issue an
opinion with respect to its audit or review. Buyer will pay or, if paid,
reimburse Seller, within ten (10) Business Days after demand therefor, for any
reasonable out-of-pocket and overhead costs incurred by Seller in complying with
the provisions of this Section 11.03.

Article XII
The Closing

Section 12.01Time and Place of the Closing. If the conditions referred to in
Articles IX and X of this Agreement have been satisfied or waived in writing,
and subject to any extensions pursuant to Sections 4.04(b), 5.03 or 13.01(f) or
by written agreement of the Parties or as the Parties otherwise may agree in
writing, the transactions contemplated by this Agreement (the “Closing”) shall
take place at the offices of Seller, whose address is One Concho Center, 600 W.
Illinois Ave., Midland, Texas 79701, or at such other place reasonably
designated by Seller, on December 20, 2012, at 9:00 a.m. local time in Midland,
Texas (the “Closing Date”).

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Section 12.02Adjustments to Purchase Price at the Closing.

(a)At the Closing, the Purchase Price shall be increased by the following
amounts (without duplication):
(i)an amount equal to all prepaid ad valorem, property and similar Taxes and
assessments based upon or measured by the ownership of the Assets, and any
prepaid costs, including rentals and insurance premiums, insofar as such prepaid
taxes and costs relate to periods of time after the Effective Time;

(ii)an amount equal to all operating and capital costs and expenses (including
without limitation rentals, royalties, drilling costs, capital expenditures,
lease operating expenses, expenses incurred under applicable operating
agreements and, for wells located on the Leases and not operated by Seller or
Seller's Affiliates, overhead charges allowable under applicable accounting
procedures (COPAS), and including any charges incurred by Seller as
non-operator, or in the absence of an operating agreement, those customarily
billed under such agreements) previously paid by Seller that are attributable to
the Assets and attributable to the period of time from and after the Effective
Time;

(iii)all increases to the Purchase Price for Title Benefits provided in
Section 4.09;

(iv)the value of all merchantable Hydrocarbons produced prior to the Effective
Time but in storage above the sales connection or upstream of the applicable
sales meter as of the Effective Time, such value to be the actual price received
for such Hydrocarbons upon the first sale thereof or absent a sale, then such
value shall be based upon the average market price posted in the area for
Hydrocarbons of similar quality and grade in effect as of the Effective Time,
less all applicable royalties, production or severance Taxes, gravity
adjustments and transportation expenses necessary to market such production;

(v)all proceeds actually paid to Buyer from sales of Hydrocarbons that are
produced and saved prior to the Effective Time and any other revenues paid to
Buyer that arise out of the ownership or operation of the Assets prior to the
Effective Time;

(vi)an amount equal to all Taxes (other than income taxes, ad valorem, property
and similar taxes) that are incurred and paid by Seller in connection with the
ownership or operation of the Assets from and after the Effective Time;

(vii)for all wells located on the Leases and operated by Seller or any of
Seller's Affiliates, a monthly overhead fee of $800.00, prorated for partial
months, per well while Seller is operating the Assets from and after the
Effective Time; and

(viii)any other amounts provided for in this Agreement or agreed by Buyer and
Seller.

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(b)At the Closing, the Purchase Price shall be decreased by the following
amounts (without duplication):

(i)an amount equal to all unpaid ad valorem, property and similar Taxes and
assessments based upon or measured by the ownership of the Assets insofar as
such unpaid Taxes relate to periods of time prior to the Effective Time, which
amount shall, to the extent not actually assessed, be computed based on such
Taxes and assessments for the preceding taxable year (such amount to be prorated
for the period of Seller's ownership prior to the Effective Time);

(ii)all proceeds actually collected by Seller from sales of Hydrocarbons that
are produced and saved from and after the Effective Time and any other cash
receipts of Seller arising out of the ownership or operation of the Assets from
and after the Effective Time;

(iii)the Allocated Value of any Subject Interest covered by an exercised PPR
pursuant to Section 4.07(b);

(iv)all reductions in the Purchase Price for Title Defects provided in
Article IV and for Environmental Defects provided in Article V;

(v)an amount equal to all cash in, or attributable to, suspense accounts
relative to the Assets for which Buyer has assumed responsibility under
Section 16.02;

(vi)$500,000.00 related to post-Effective Time workovers in the Lower Abo Field;
and

(vii)any other amount provided for in this Agreement or agreed by Buyer and
Seller.

(c)The adjustments described in Sections 12.02(a) and (b) above are referred to
as the “Purchase Price Adjustments.” To the extent that the amount of any
Purchase Price Adjustment is not determinable with certainty by Seller prior to
the Closing, the amount of such Purchase Price Adjustment shall be determined by
Seller based upon Seller's good faith estimate.

Section 12.03Closing Statement. Not later than the third Business Day prior to
the Closing Date, Seller shall prepare and deliver to Buyer a statement (the
“Closing Statement”) of (a) the estimated Purchase Price Adjustments, and (b) a
credit for the Deposit as described in Section 3.02(b). At the Closing, Buyer
shall pay the Purchase Price as so estimated to Seller in immediately available
federal funds, as adjusted by the Purchase Price Adjustments and the credit for
the Deposit reflected on the Closing Statement.

Section 12.04Actions of Seller at the Closing. At the Closing, Seller shall:

(a)execute, acknowledge and deliver to Buyer the Assignment, in sufficient
counterparts for filing in each appropriate county, and such other instruments
(in form

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and substance agreed by Buyer and Seller) as may be reasonably necessary to
convey the Assets to Buyer, including appropriate state and federal assignments
of record title and operating rights;

(b)upon written request of Buyer at least twenty-one (21) days prior to the
Closing Date, execute and deliver to Buyer letters in lieu of transfer or
division orders directing all purchasers of Hydrocarbon production from the
Subject Interests to make payment of proceeds attributable to such production to
Buyer from and after the Effective Time;

(c)execute and deliver to Buyer the Closing Statement;

(d)subject to the provisions of Section 14.03 regarding the Records, deliver to
Buyer possession of the Assets;

(e)deliver to Buyer a certificate under Section 1445(b)(2) of the Code executed
by Seller, providing that Seller is not a foreign Person;

(f)execute and deliver to Buyer appropriate change of operator forms on those
Assets operated by Seller or Seller's Affiliates;

(g)deliver to Buyer recorded or recordable releases of all mortgage liens,
security interests and financing statements granted by Seller that encumber the
Assets, if any;

(h)deliver to Buyer a Closing Certificate dated as of the Closing Date, executed
by an executive officer of Seller, certifying that all of the conditions set
forth in Section 10.01 and Section 10.02 have been satisfied; and

(i)execute, acknowledge and deliver any other agreements provided for in this
Agreement or necessary or desirable to effectuate the transactions contemplated
by this Agreement as may be reasonably requested by Buyer.

Section 12.05Actions of Buyer at the Closing. At the Closing, Buyer shall:

(a)deliver to Seller the Purchase Price in immediately available federal funds
(with the adjustments and credits provided in Section 12.03) by wire transfer to
accounts designated by notice to Buyer from Seller on or before the second
Business Day before the Closing;

(b)execute and deliver to Seller the Closing Statement;

(c)deliver to Seller written evidence of Buyer's compliance with the
qualification and bonding requirements of Section 7.07;

(d)deliver to Seller a Closing Certificate dated as of the Closing Date,
executed by the general partner of Buyer, certifying that all of the conditions
set forth in Section 9.01 and Section 9.02 have been satisfied;

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(e)subject to the provisions of Section 14.03 regarding the Records, take
possession of the Assets; and

(f)execute, acknowledge and deliver the Assignment and any other agreements
provided for in this Agreement or necessary or desirable to effectuate the
transactions contemplated by this Agreement.

Article XIII
Termination

Section 13.01Right of Termination. This Agreement may be terminated at any time
at or prior to the Closing:

(a)by written consent of Buyer and Seller;

(b)by Seller on the Closing Date if the conditions set forth in Article IX have
not been satisfied in all material respects or waived by Seller;

(c)by Buyer on the Closing Date if the conditions set forth in Article X have
not been satisfied in all material respects or waived by Buyer;

(d)by Seller, by notice to Buyer on or after December 21, 2012, if the Closing
shall not have occurred;

(e)by Buyer or Seller if any Governmental Authority shall have issued an order,
judgment or decree or taken any other action challenging, delaying, restraining,
enjoining, prohibiting or invalidating the consummation of any of the
transactions contemplated by this Agreement; or

(f)by Buyer or Seller if (i) the aggregate amount of the Purchase Price
Adjustments agreed by the Parties or otherwise finally determined pursuant to
this Agreement with respect to Title Defect Values attributable to all uncured
Title Defects (net of the aggregate amount of the Purchase Price Adjustments for
all Title Benefits) determined in accordance with Article IV, plus (ii) the
aggregate amount of the Purchase Price Adjustments agreed to by the Parties or
otherwise finally determined pursuant to this Agreement with respect to
Environmental Defect Values attributable to all uncured Environmental Defects
determined in accordance with Article V, exceeds twenty percent (20%) of the
Unadjusted Purchase Price; provided, however, that if a Dispute regarding the
existence or value of any of the foregoing is subject to resolution in
accordance with Article XVIII, Seller shall have the right and option to
postpone the Closing Date, and if Seller exercises such right no Party may
terminate this Agreement pursuant to this Section 13.01(f), until each such
Dispute is resolved;

provided, however, that no Party shall have the right to terminate this
Agreement pursuant to clause (b), (c), (d) or (f) above if that Party is at the
time in material breach of any provision of this Agreement.

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Section 13.02Effect of Termination. If the Closing does not occur as a result of
any Party exercising its right to terminate pursuant to Section 13.01, then
except as provided in Sections 4.01, 5.01, 13.02, 13.04, 13.05 and 18.05, this
Agreement shall be null and void and no Party shall have any further rights or
obligations under this Agreement, except that a Party shall continue to be
liable for any breach of this Agreement or any liability that has accrued prior
to the date of termination or results from any event occurring prior to
termination. Notwithstanding anything to the contrary contained in this
Agreement, upon any termination of this Agreement pursuant to this Article XIII,
Seller shall be free immediately to enjoy all rights of ownership of the Assets
and to sell, transfer, encumber or otherwise dispose of the Assets to any person
without any restriction under this Agreement or claim by Buyer hereunder.
Termination of this Agreement shall not affect the Parties' rights or
obligations under the Confidentiality Agreement.

Section 13.03Termination Damages.

(a)If this Agreement is terminated by Seller as provided in Section 13.01(b),
then Seller shall retain the Deposit as liquidated damages on account of such
termination, which remedy upon such a termination by Seller shall be the sole
and exclusive remedy available to Seller. Buyer and Seller acknowledge and agree
that (i) Seller's actual damages upon such a termination are difficult to
ascertain with any certainty, (ii) that the Deposit is a reasonable estimate of
such actual damages and (iii) such liquidated damages do not constitute a
penalty.

(b)If this Agreement is terminated as provided in Sections 13.01 (a), (c), (d),
(e) or (f), then within three (3) Business Days after termination Seller shall
return to Buyer in immediately available funds the Deposit.

Section 13.04Return of Documents and Confidentiality. Upon any termination of
this Agreement, Buyer shall within ten (10) Business Days following such
termination return to Seller all title, engineering and other data, reports,
maps and other information furnished by Seller or any Affiliates or Advisors of
Seller to Buyer or prepared by or on behalf of Buyer in connection with its due
diligence investigation of the Assets, together with all copies of the
foregoing, and an officer of Buyer shall certify same to Seller in writing.

Section 13.05Damages. Notwithstanding anything to the contrary in this
Agreement, in no event shall any Party be entitled to receive any punitive,
indirect or consequential damages unless they are a part of a Third Party claim
for which a Party is seeking indemnification under this Agreement, REGARDLESS OF
WHETHER CAUSED OR CONTRIBUTED TO BY THE SOLE, JOINT, COMPARATIVE OR CONCURRENT
NEGLIGENCE OR STRICT LIABILITY OF THE OTHER PARTY.

Article XIV
Post-Closing Obligations

Section 14.01Gas Imbalances. The Gas Imbalances attributable to the Subject
Interests as of the dates set forth on Schedule 14.01, of which Seller has
Knowledge, are set forth on Schedule 14.01 (the “Agreed Imbalance”). For
purposes of this Agreement, “Gas Imbalances” means over-production or
under-production subject to an imbalance or make-up obligation with respect to
gas produced from or allocated to the Subject Interests, regardless of whether
such

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over-production or under-production, imbalance or make-up obligation arises at
the wellhead, pipeline, gathering system, transportation or other location and
regardless of whether the same arises under contract or by operation of Law.
Buyer and Seller shall jointly verify the actual net gas imbalances as of the
Effective Time in the Accounting Statement and any Agreed Imbalance shall be
accounted for between the Parties in the Accounting Statement at the New York
Mercantile Exchange (NYMEX) closing price per MCF on the third (3rd) Business
Day preceding the Effective Time. This settlement shall be final and no Party
afterwards shall make claim upon the other Parties concerning the Gas
Imbalances. BUYER ASSUMES ALL RIGHTS AND LIABILITIES RELATING TO GAS IMBALANCES
DISCOVERED AFTER THE FINAL STATEMENT INCLUDING ANY REVENUE ADJUSTMENT CAUSED BY
SUCH SUBSEQUENTLY DISCOVERED GAS IMBALANCES AND AGREES TO DEFEND AND INDEMNIFY
SELLER FROM AND AGAINST ANY CLAIM, BY ANYONE, ARISING OUT OF SUCH GAS IMBALANCES
REGARDLESS OF SELLER'S NEGLIGENCE OR FAULT (INCLUDING STRICT LIABILITY).

Section 14.02Final Accounting Statement.

(a)On or before the one hundred twentieth (120th) day after the Closing Date,
Seller shall prepare and deliver to Buyer a revised Closing Statement setting
forth a detailed calculation of the actual Purchase Price Adjustments (the
“Accounting Statement”). The Accounting Statement shall include any adjustment
or payment which was not finally determined as of the Closing Date, including
any Gas Imbalances, and the allocation of revenues and expenses as determined in
accordance with Section 12.02. Seller shall provide Buyer such data and
information as Buyer reasonably may request supporting the amounts reflected on
the Accounting Statement to permit Buyer to agree to the Accounting Statement.
The Accounting Statement shall become final and binding on the Parties on the
thirty-first (31st) day following receipt by Buyer (the “Final Settlement Date”)
unless Buyer gives written notice of its disagreement (a “Notice of
Disagreement”) to Seller prior to that date, and upon such Notice of
Disagreement, the Accounting Statement will be final and binding with respect to
all matters other than those specified in the Notice of Disagreement. Any Notice
of Disagreement shall specify in detail the dollar amount, nature and basis of
any disagreement so asserted. If a Notice of Disagreement is received by Seller
in a timely manner, then the Parties shall resolve the Dispute evidenced by the
Notice of Disagreement in accordance with Article XVIII.

(b)If the amount of the Purchase Price as set forth on the Final Statement
exceeds the amount of the estimated Purchase Price paid at the Closing, then
Buyer shall pay to Seller the amount by which the Purchase Price as set forth on
the Final Statement exceeds the amount of the estimated Purchase Price paid at
the Closing on or before the third (3rd) Business Day after the Final Settlement
Date (or within the third (3rd) Business Day of resolution of the Final
Statement by an Independent Expert, if

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applicable). If the amount of the Purchase Price as set forth on the Final
Statement is less than the amount of the estimated Purchase Price paid at the
Closing, then Seller shall refund to Buyer the amount by which the Purchase
Price as set forth on the Final Statement is less than the amount of the
estimated Purchase Price paid at the Closing on or before the third (3rd)
Business Day after the Final Settlement Date (or within the third (3rd) Business
Day of resolution of the Final Statement by an Independent Expert, if
applicable). For purposes of this Agreement, the term “Final Statement” means
(i) the final Accounting Statement as finalized pursuant to Section 14.02(a), or
(ii) upon resolution of any Dispute regarding a Notice of Disagreement, the
final Accounting Statement reflecting those resolutions.

(c)The Parties agree that any and all payments pursuant to this Agreement shall,
to the maximum extent permitted by applicable Law, be treated for all Tax
purposes as an adjustment to the Purchase Price.

Section 14.03Further Cooperation. Seller shall make the Records available to be
picked up by Buyer at the offices of Seller during normal business hours within
thirty (30) Business Days after the Closing to the extent the Records are in the
possession of Seller and are not subject to contractual restrictions on
transferability; provided, that Seller shall provide Buyer with reasonable
access to such Records during such period. Seller shall have the right to retain
copies of any of the Records and the rights granted under Section 19.04.

Section 14.04After the Closing. After the Closing Date, Seller and Buyer, at the
request of the other and without additional consideration, shall execute and
deliver, or shall cause to be executed and delivered, from time to time such
further instruments of conveyance and transfer and shall take such other action
as the other reasonably may request to convey and deliver the Assets to Buyer
and to accomplish the orderly transfer of the Assets to Buyer in the manner
contemplated by this Agreement. In furtherance of the foregoing, Seller shall,
at Buyer's request, use Seller's reasonable efforts to assist Buyer in obtaining
appropriate assignments of Seller's operating rights and record title with
respect to Leases from Governmental Authorities. After the Closing, the Parties
will cooperate to have all proceeds received attributable to the Assets be paid
to the proper Party under this Agreement and to have all expenditures to be made
with respect to the Assets be made by the proper Party under this Agreement. To
the extent a Party receives funds after the Closing Date, other than funds
described in and allocated pursuant to Section 12.02(a) or (b), to which another
Party is entitled, the receiving Party will promptly, but in any event no later
than ten (10) days after receipt, transfer such funds to the Party so entitled.
To the extent a Party receives any invoice or statement after the Closing Date
that is the responsibility of another Party, the receiving Party will promptly,
but in any event no later than ten (10) days after receipt, send the invoice or
statement to the appropriate Party.

Article XV
Operation of the Assets

Section 15.01Operations. From and after the date of this Agreement until the
Closing, except as expressly contemplated by this Agreement, as expressly
consented to in writing by Buyer (which consent will be conclusively presumed to
have been given as of 5:00 p.m. Midland time on the third (3rd) Business Day
following notice to Buyer requesting the consent unless Buyer has notified
Seller in writing that it does not consent), or in situations in which emergency
action is taken in the face of risk to life, property or the environment, Seller
shall:
(a)operate and maintain the Subject Interests operated by Seller or an Affiliate
of Seller in the usual, regular and ordinary manner consistent with past
practice,

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for which Seller shall be entitled to retain or obtain payment or reimbursement
for overhead charges attributable to the period from the Effective Time until
Closing payable by Third Parties pursuant to applicable operating agreements or
in the absence of an operating agreement, those customarily billed under such
agreements;

(b)except to the extent necessary to maintain the Leases, not enter into a
material Contract, or materially amend or change the terms of any such Contract
that would involve individual commitments of more than $100,000, net to the
Working Interest of Seller;

(c)Except to the extent necessary or advisable to avoid forfeiture or penalties,
not enter into agreements to drill new wells or to rework, plug back, deepen,
plug or abandon any well located on the Leases, nor commence any drilling,
reworking or completing or other operations on the Leases which requires
estimated expenditures exceeding $100,000, net to the Working Interest of
Seller, for each operation (except for emergency operations and operations
required under presently existing authorizations for expenditures described on
Schedule 6.13) without obtaining the prior written consent of Buyer (which
consent shall not be unreasonably withheld, delayed or conditioned); provided
that the terms of this paragraph (c) shall not apply to any expenditures of
Seller which will not be charged to Buyer;

(d)unless required by Law or a Governmental Authority, not plug or abandon any
well located on the Subject Interests that is identified on Exhibit B as
producing;

(e)not transfer, sell, mortgage, farmout, hypothecate, pledge or otherwise
dispose of any material portion of the Subject Interests other than the sale
and/or disposal of Hydrocarbons in the ordinary course of business and sales of
equipment that is no longer necessary in the operation of the Subject Interests
or for which replacement equipment has been obtained;

(f)not release, terminate or materially amend any material Lease or Easement;

(g)not enter into any agreement, instrument or document or take or fail to take
any action which would have the effect of reducing the Net Revenue Interests of
Seller below those set forth in Exhibit B or increasing the Working Interests of
Seller above those set forth in Exhibit B without a corresponding increase in
the Net Revenue Interests;
 
(h)not voluntarily relinquish its position as Operator to anyone other than
Buyer with respect to any of the operated Assets; and

(i)to the extent Seller has Knowledge thereof, provide Buyer with written notice
of (i) any claims, demands, suits or actions made against Seller which
materially affect the Assets; or (ii) any proposal from a Third Party to engage
in any material transaction (e.g., a farmout) with respect to the Assets.

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Section 15.02Limitations on the Operational Obligations and Liabilities of
Seller.

(a)Buyer acknowledges that Seller owns undivided interests in some or all of the
Assets, and Buyer agrees that, as long as Seller has voted Seller's interests in
a manner that complies with the provisions of this Article XV, the acts or
omissions of the other working interest owners shall not constitute a violation
of the provisions of this Article XV, nor shall any action required by a vote of
working interest owners constitute such a violation. To the extent that Seller
or an Affiliate of Seller is not the operator of an Asset, the obligations of
Seller in this Article XV shall be construed to require that Seller use
reasonable efforts (without being obligated to incur any material expense or
institute any cause of action) to cause the operator of that Asset to take such
actions or render such performance within the constraints of the applicable
operating agreements and other applicable agreements.

(b)Notwithstanding anything to the contrary in this Article XV, Seller shall
have no liability to Buyer for, and Buyer agrees to release, defend, indemnify
and hold harmless Seller, Seller's members, managers, Affiliates, co-lessees,
co-venturers and their respective officers, directors, managers, employees,
agents, partners, representatives, members, shareholders, Affiliates,
subsidiaries, successors and assigns (collectively, “Seller Indemnitees”) from,
the incorrect payment of delay rentals, royalties, shut-in royalties or similar
payments or for any failure to pay any such payments through mistake or
oversight (INCLUDING THOSE RESULTING FROM SELLER INDEMNITEES' SOLE, JOINT,
COMPARATIVE OR CONCURRENT NEGLIGENCE OR STRICT LIABILITY) to the extent that
such payments relate to periods after the Effective Time. In no event shall
Buyer's remedy for Seller's breach of Seller's obligations under this Article XV
exceed the Allocated Value of the Subject Interest affected by such breach.

Section 15.03Operation of the Assets after the Closing. It is expressly
understood and agreed that Seller shall not be obligated to continue operating
any of the operated Assets following the Closing and Buyer assumes full
responsibility for operating (or causing the operation of) all such Assets
following the Closing. Seller does not warrant or guarantee that Buyer will
become the operator of the operated Assets or any portion of the Assets, as such
matter will be controlled by the applicable joint operating agreement(s).
Without implying any obligation on Seller's part to continue operating any
operated Assets after the Closing, if Seller elects to continue to operate any
such Assets following the Closing at the request of Buyer or any Third Party
working interest owner, due to constraints of applicable joint operating
agreement(s), failure of a successor operator to take over operations or other
reasonable cause, the continued operation by Seller shall be for the account of
Buyer, at the sole risk, cost and expense of Buyer. Buyer releases and agrees to
indemnify, defend and hold harmless Seller Indemnitees, as a part of the Assumed
Obligations, from and against all claims, losses, damages, costs, expenses,
causes of action and judgments of any kind or character (INCLUDING THOSE
RESULTING FROM SELLER INDEMNITEES' SOLE, JOINT, COMPARATIVE OR CONCURRENT
NEGLIGENCE OR STRICT LIABILITY) with respect to (a) continued operations by
Seller, (b) Buyer's assumption of operations from Seller, and (c) compliance
with the terms of any applicable joint operating agreement related to the
election of a successor operator.

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Section 15.04Change in Circumstances; Casualty Loss.

(a)Buyer shall assume all risk of loss with respect to, and any change in the
condition of, the Assets from the Effective Time until the Closing, including
with respect to the depletion of Hydrocarbons, the watering-out of any well, the
collapse of casing, sand infiltration of wells and damage to and depreciation of
property, including normal wear and tear.

(b)If after the Effective Time and prior to the Closing any part of the Assets
shall be damaged or destroyed by fire or other casualty or if any part of the
Assets shall be taken in condemnation or under the right of eminent domain or if
proceedings for such purposes shall be pending or threatened, this Agreement
shall remain in full force and effect notwithstanding any such destruction,
taking or proceeding, or the threat of any such destruction, taking or
proceeding, and the Parties shall proceed with the transactions contemplated by
this Agreement notwithstanding such destruction or taking without reduction of
the Purchase Price, but subject to Section 15.04(c). Seller shall maintain
Seller's existing insurance coverage with respect to the Assets from the date of
this Agreement until Closing.

(c)Notwithstanding Section 15.04(a), in the event of any loss described in
Section 15.04(b), at the Closing, Seller shall pay to Buyer all sums paid to
Seller by Third Parties by reason of the destruction or taking of such Assets
(up to the Allocated Value), including any sums paid pursuant to any policy or
agreement of insurance or indemnity, and shall assign, transfer and set over
unto Buyer all of the rights, title and interest of Seller in and to any claims,
causes of action, unpaid proceeds or other payments from Third Parties,
including any policy or agreement of insurance or indemnity, arising out of such
destruction or taking (up to the Allocated Value).

Article XVI
Obligations and Indemnification

Section 16.01Retained Obligations. Provided that the Closing occurs and subject
to Section 16.04, Seller shall retain (but only to the extent Buyer has provided
Seller with a timely Claim Notice in accordance with Section 16.04(a) and not
otherwise, and only to the extent the same do not constitute Permitted
Encumbrances, Indemnified Title Defects, Assumed Environmental Obligations or
Indemnified Environmental Defects) all costs, expenses, liabilities and
obligations of Seller related to (a) the payment or improper payment of
royalties, rentals and other similar payments by Seller accruing under the
Leases prior to the Effective Time; (b) claims of Third Parties for personal
injury, death or property damage to the extent such personal injury, death or
property damage occurs prior to the Effective Time as a result of the operation
of the Assets by Seller; (c) the mispayment or non-payment by Seller of ad
valorem, property, severance, production and similar Taxes attributable to the
Assets prior to the Effective Time; and (d) claims of Buyer arising in
connection with the breach by Seller of any representation or warranty set forth
in this Agreement that survives Closing; (e) claims against Seller by co‑working
interest owners in the Assets for matters occurring prior to the Effective Time
in connection with Seller's operation of the Assets; and (f) any contamination
or condition that is a result of any off-site disposal by Seller of any
Hazardous Substances produced from the

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Leases on, in or below any properties not included in the Assets prior to the
Effective Time, for which, and to the extent that, remediation of any such
contamination or condition is required by any Environmental Law (collectively,
the “Retained Obligations”).

Section 16.02Assumed Obligations. Provided that the Closing occurs, Buyer hereby
assumes all duties, obligations and liabilities of every kind and character with
respect to the Assets or the ownership or operation of the Assets (other than
the Retained Obligations), whether attributable to periods before, at or after
the Effective Time, REGARDLESS OF WHETHER CAUSED OR CONTRIBUTED TO BY THE SOLE,
JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL
FAULT OF THE SELLER INDEMNITEES, including those arising out of (a) the terms of
the Easements, Contracts, Leases, Personal Property or Subject Interests
comprising part of the Assets; (b) Gas Imbalances; (c) payment of funds held in
suspense for the benefit of Third Parties (it being agreed that, notwithstanding
anything in this Agreement to the contrary, Buyer shall be solely responsible
for the distribution of all suspended funds to Third Parties relating to the
Assets and for which there is a Purchase Price adjustment pursuant to Section
12.02(b)(v)); (d) the condition of the Assets, regardless of whether such
condition arose before or after the Effective Time; (e) obligations to properly
plug and abandon or re-plug or re-abandon or remove or bury wells, flowlines,
gathering lines or other facilities, equipment or other personal property or
fixtures comprising part of the Assets; (f) the Assumed Environmental
Obligations; (g) alleged Title Defects that are deemed to constitute Assumed
Obligations under Article IV; (h) the obligations and liabilities described in
Section 16.01 to the extent Buyer does not provide Seller with a Claim Notice
complying with Section 16.05 on or before the day occurring one (1) year after
the Closing; (i) all unpaid ad valorem, property and similar Taxes and
assessments based upon or measured by the ownership of the Assets; (j) any other
duty, obligation, event, condition or liability assumed by Buyer under the terms
of this Agreement; and (k) any Retained Obligation as to which Seller does not
have, or no longer has, an obligation to indemnify Buyer in accordance with the
terms of this Agreement (collectively, the “Assumed Obligations”).

Section 16.03Buyer's Indemnification. PROVIDED THAT THE CLOSING OCCURS, BUYER
SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD HARMLESS SELLER INDEMNITEES FROM AND
AGAINST ANY AND ALL CLAIMS, DAMAGES, LIABILITIES, LOSSES, CAUSES OF ACTION,
COSTS AND EXPENSES (INCLUDING THOSE INVOLVING THEORIES OF NEGLIGENCE OR STRICT
LIABILITY OR PRE-EXISTING DEFECTS AND INCLUDING COURT COSTS AND ATTORNEYS' FEES)
(COLLECTIVELY, THE “LOSSES” OR IN THE SINGULAR, A “LOSS”) AS A RESULT OF,
ARISING OUT OF, OR RELATED TO THE ASSUMED OBLIGATIONS, REGARDLESS OF WHETHER
CAUSED OR CONTRIBUTED TO BY THE SOLE, JOINT, COMPARATIVE OR CONCURRENT
NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL FAULT OF ANY OF THE SELLER
INDEMNITEES.

Section 16.04Seller's Indemnification. PROVIDED THAT THE CLOSING OCCURS, SELLER
SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD HARMLESS BUYER, ITS PARTNERS, AND
THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, REPRESENTATIVES,
MEMBERS, SHAREHOLDERS, AFFILIATES AND SUBSIDIARIES (COLLECTIVELY, THE “BUYER
INDEMNITEES”) FROM AND AGAINST ANY AND ALL LOSSES AS A RESULT OF, ARISING OUT
OF,

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OR RELATED TO THE RETAINED OBLIGATIONS, REGARDLESS OF WHETHER CAUSED OR
CONTRIBUTED TO BY THE SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE OR
STRICT LIABILITY OF ANY OF THE BUYER INDEMNITEES; provided, however,
notwithstanding anything to the contrary contained in this Agreement, (a)
Seller's obligations under this Section 16.04 shall apply only if and to the
extent Buyer provides Seller with a Claim Notice complying with Section 16.05 on
or before the day occurring one (1) year after the Closing, (b) Buyer shall bear
sole responsibility for the aggregate Losses associated with all such claims up
to a threshold percentage of two percent (2%) of the Unadjusted Purchase Price,
it being intended by the Parties that Seller be obligated only to the extent of
those Losses that exceed two percent (2%) of the Unadjusted Purchase Price, and
(c) Seller's aggregate liability is limited to an amount equal to fifty percent
(50%) of the Unadjusted Purchase Price. INDEMNIFICATION UNDER THIS SECTION 16.04
SHALL BE BUYER'S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO ANY RETAINED
OBLIGATION, AND SELLER'S LIABILITY WITH RESPECT TO ANY RETAINED OBLIGATION SHALL
BE SUBJECT TO THE PROCEDURES AND LIMITATIONS ON TIMING AND AMOUNT PROVIDED IN
THIS SECTION 16.04 AND IN SECTION 16.05.

Section 16.05Notices and Defense of Indemnified Matters.

(a)For purposes of this Section 16.05, the term “Indemnifying Party” when used
in connection with particular Losses shall mean the party or parties having an
obligation under this Article XVI to another party or parties with respect to
such Losses pursuant to this Agreement, and the term “Indemnified Party” when
used in connection with particular Losses shall mean the party or parties having
the right to be indemnified or otherwise protected with respect to such Losses
by another party or parties pursuant to this Agreement.

(b)To make a claim under any of Section 16.03 or 16.04, an Indemnified Party
must notify the Indemnifying Party of its claim under this Section 16.05,
including the specific details of and specific basis under this Agreement for
its claim (the “Claim Notice”). In the event that the claim is based upon a
claim by a Third Party against the Indemnified Party (a “Claim”), the
Indemnified Party shall provide its Claim Notice promptly after the Indemnified
Party has actual knowledge of the Claim and shall enclose a copy of all papers
(if any) served with respect to the Claim; provided, however, that the failure
of any Indemnified Party to give timely notice of a Claim as provided in this
Section 16.05 shall relieve the Indemnifying Party of its obligations under
Section 16.03 or 16.04 (as applicable) only to the extent that failure results
in insufficient time being available to permit the Indemnifying Party to defend
effectively against the Claim or otherwise materially prejudices the
Indemnifying Party's ability to defend against the Claim.

(c)In the case of a claim based upon a Claim, the Indemnifying Party, on or
before the thirtieth (30th) day after its receipt of the Claim Notice, shall
notify the Indemnified Party whether it admits or denies its liability to defend
the Indemnified Party against the Claim at the sole cost and expense of the
Indemnifying Party. The Indemnified Party is authorized, prior to and before the
expiration of this 30-day period, to file any motion, answer or other pleading
that it shall deem necessary or appropriate to

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protect its interests or those of the Indemnifying Party and that is not
prejudicial to the Indemnifying Party.

(d)If the Indemnifying Party admits its liability to defend the Claim, it shall
have the right and obligation to diligently defend, at its sole cost and
expense, the Claim. The Indemnifying Party shall have full control of such
defense and proceedings, including any compromise or settlement of the Claim. If
requested by the Indemnifying Party, the Indemnified Party agrees to cooperate
in contesting any Claim which the Indemnifying Party elects to contest. The
Indemnified Party may participate in, but not control, any defense or settlement
of any Claim controlled by the Indemnifying Party pursuant to this
Section 16.05. Without the written consent of the Indemnified Party, an
Indemnifying Party shall not (i) settle any Claim or consent to the entry of any
judgment with respect to any Claim which does not include an unconditional
written release of the Indemnified Party from all liability in respect of such
Claim or (ii) settle any Claim or consent to the entry of any judgment with
respect any Claim in any manner that may materially and adversely affect the
Indemnified Party (other than as a result of money damages covered by the
indemnity).

(e)If the Indemnifying Party does not admit its liability to defend the Claim or
admits its liability but fails diligently to prosecute or settle the Claim, then
the Indemnified Party shall have the right to defend against the Claim at the
sole cost and expense of the Indemnifying Party, with counsel of the Indemnified
Party's choosing, subject to the right of the Indemnifying Party to admit its
liability to defend the Claim and assume the defense of the Claim at any time
prior to its settlement or final determination. If the Indemnifying Party has
not yet admitted its liability for a Claim defense, the Indemnified Party shall
notify the Indemnifying Party of any proposed settlement and the Indemnifying
Party shall have the option, on or before the tenth (10th) day following receipt
of that notice (i) to admit in writing its liability for the Claim defense, and
(ii) if liability is so admitted, to reject, in its reasonable judgment, the
proposed settlement.

(f)In the case of a claim not based upon a Claim, the Indemnifying Party shall
have thirty (30) days from its receipt of the Claim Notice (i) to cure the
Losses complained of, (ii) to admit its liability for those Losses, or (iii) to
dispute the claim for those Losses. If the Indemnifying Party does not notify
the Indemnified Party within this 30-day period that it has cured the Losses or
that it disputes the claim for those Losses, the amount of those Losses shall
conclusively be deemed a liability of the Indemnifying Party.

Article XVII
Limitations on Representations and Warranties

Section 17.01Disclaimers of Representations and Warranties. The express
representations and warranties of Seller contained in this Agreement are
exclusive and are in lieu of all other representations and warranties, express,
implied or statutory.

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Section 17.02Sale “As Is” “Where Is”. BUYER REPRESENTS THAT IT HAS INSPECTED, OR
WILL HAVE THE OPPORTUNITY TO INSPECT, THE ASSETS AND IF CLOSING OCCURS, WILL
ACCEPT THE PHYSICAL AND ENVIRONMENTAL CONDITION OF SAME ON AN “AS IS-WHERE IS”
BASIS, AND BUYER FOREVER RELEASES SELLER FROM ANY LIABILITY WITH RESPECT TO THE
PHYSICAL AND ENVIRONMENTAL CONDITION OF THE ASSETS AT THE CLOSING, REGARDLESS OF
WHETHER CAUSED BY OR ATTRIBUTABLE TO SELLER'S SOLE, JOINT, COMPARATIVE OR
CONCURRENT NEGLIGENCE, FAULT, OR STRICT LIABILITY, AND REGARDLESS OF WHETHER
ARISING DURING THE PERIOD OF, OR FROM, OR IN CONNECTION WITH SELLER'S OWNERSHIP
OF THE ASSETS OR USE OF THE PROPERTY DESCRIBED IN THE LEASES BEFORE OR AT THE
CLOSING. WITHOUT LIMITING THE FOREGOING, BUYER WAIVES ANY RIGHT TO RECOVER FROM
SELLER AND FOREVER RELEASES AND DISCHARGES SELLER AND AGREES TO RELEASE,
INDEMNIFY, DEFEND AND HOLD SELLER INDEMNITEES HARMLESS FROM AND AGAINST ANY AND
ALL DAMAGES, CLAIMS, LOSSES, LIABILITIES, PENALTIES, FINES, LIENS, JUDGMENTS,
COSTS AND EXPENSES WHATSOEVER, INCLUDING ATTORNEYS' FEES AND COSTS, WHETHER
DIRECT OR INDIRECT, KNOWN OR UNKNOWN, FORESEEN OR UNFORESEEN, THAT MAY ARISE ON
ACCOUNT OF OR IN ANY WAY BE CONNECTED WITH THE PHYSICAL AND ENVIRONMENTAL
CONDITION OF THE ASSETS AT THE CLOSING OR ANY LAW OR REGULATION APPLICABLE TO
THE ASSETS, INCLUDING THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND
LIABILITY ACT OF 1980, AS AMENDED (42 U.S.C. § 9601 et. seq.), THE RESOURCE
CONSERVATION AND RECOVERY ACT OF 1976 (42 U.S.C. § 6901 et. seq.), THE CLEAN
WATER ACT (33 U.S.C. §§ 466 et. seq.), THE SAFE DRINKING WATER ACT (14 U.S.C. §§
1401-1450), THE HAZARDOUS MATERIALS TRANSPORTATION ACT (49 U.S.C. § 7401 et.
seq.), AS AMENDED, THE CLEAN AIR ACT AMENDMENTS OF 1990, AND ANY OTHER
APPLICABLE FEDERAL, STATE OR LOCAL LAW, REGARDLESS OF WHETHER ARISING DURING THE
PERIOD OF, OR FROM, OR IN CONNECTION WITH, SELLER'S OWNERSHIP OF THE ASSETS OR
USE OF THE PROPERTY DESCRIBED IN THE LEASES AT OR PRIOR TO THE CLOSING, AND
REGARDLESS OF WHETHER ATTRIBUTABLE TO THE STRICT LIABILITY OF SELLER OR TO THE
SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE OF SELLER, EVEN IF CAUSED BY
THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SELLER PRIOR TO CLOSING.
NOTWITHSTANDING THE FOREGOING, BUYER AND SELLER AGREE THAT THE PROVISIONS OF
THIS SECTION 17.02 ARE ALSO SUBJECT TO AND LIMITED BY THE EXPRESS OBLIGATIONS OF
SELLER CONTAINED IN THIS AGREEMENT TO THE EXTENT THAT ANY OF THE FOREGOING
RELATE TO INDEMNIFIED ENVIRONMENTAL DEFECTS AND THE ENVIRONMENTAL INDEMNITY
AGREEMENT.

Section 17.03DISCLAIMER REGARDING THE ASSETS. BUYER ACKNOWLEDGES THAT SELLER HAS
NOT MADE, AND SELLER HEREBY EXPRESSLY DISCLAIMS AND NEGATES, ANY COVENANT,
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, RELATING TO THE CONDITION OF ANY
BUILDINGS, FACILITIES, WELLS, EQUIPMENT, INVENTORY, MACHINERY, FIXTURES AND
PERSONAL/MOVABLE PROPERTY CONSTITUTING PART OF THE

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ASSETS (COLLECTIVELY, THE “TANGIBLE PROPERTY”), INCLUDING (a) ANY IMPLIED OR
EXPRESS WARRANTY OF MERCHANTABILITY, (b) ANY IMPLIED OR EXPRESS WARRANTY OF
FITNESS FOR A PARTICULAR PURPOSE, (c) ANY IMPLIED OR EXPRESS WARRANTY OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, (d) ANY RIGHTS OF BUYER UNDER
APPROPRIATE STATUTES TO CLAIM DIMINUTION OF CONSIDERATION OR RETURN OF THE
PURCHASE PRICE, (e) ANY IMPLIED OR EXPRESS WARRANTY OF FREEDOM FROM PATENT OR
TRADEMARK INFRINGEMENT, (f) ANY IMPLIED OR EXPRESS WARRANTY OF FREEDOM FROM
HIDDEN DEFECTS OR OTHER DEFECTS, WHETHER KNOWN OR UNKNOWN, AND (g) ANY AND ALL
IMPLIED WARRANTIES EXISTING UNDER APPLICABLE LAW IN EFFECT NOW OR IN THE FUTURE,
IT BEING THE EXPRESS INTENTION OF SELLER AND BUYER THAT THE TANGIBLE PROPERTY
SHALL BE CONVEYED TO BUYER AS IS AND IN THEIR PRESENT CONDITION AND STATE OF
REPAIR. BUYER REPRESENTS TO SELLER THAT BUYER HAS MADE OR CAUSED TO BE MADE SUCH
INSPECTIONS WITH RESPECT TO THE TANGIBLE PROPERTY AS BUYER DEEMS APPROPRIATE AND
BUYER WILL ACCEPT THE TANGIBLE PROPERTY AS IS, WHERE IS, IN THEIR PRESENT
CONDITION AND STATE OF REPAIR.

Section 17.04DISCLAIMER REGARDING INFORMATION. SELLER HEREBY EXPRESSLY NEGATES
AND DISCLAIMS, AND BUYER HEREBY WAIVES, AND ACKNOWLEDGES THAT SELLER HAS NOT
MADE, ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, RELATING TO (a) THE
ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR OTHER
MATERIALS (WRITTEN, ELECTRONIC OR ORAL) NOW, IN THE PAST OR IN THE FUTURE
FURNISHED TO BUYER BY OR ON BEHALF OF SELLER OR (b) PRODUCTION RATES,
RECOMPLETION OPPORTUNITIES, DECLINE RATES, GEOLOGICAL OR GEOPHYSICAL DATA OR
INTERPRETATIONS, THE QUALITY, QUANTITY, RECOVERABILITY OR COST OF RECOVERY OF
ANY HYDROCARBON RESERVES, ANY PRODUCT PRICING ASSUMPTIONS, OR THE ABILITY TO
SELL OR MARKET ANY HYDROCARBONS AFTER CLOSING.

Article XVIII
Dispute Resolution

Section 18.01Scope; Appointment of Independent Expert. All disputes among the
Parties regarding Title Defects, Title Defect Values, Environmental Defects,
Environmental Defect Values, Title Benefits or calculation of the Final
Statement or revisions thereto (“Disputes”) shall be exclusively and finally
resolved pursuant to this Article XVIII. If the Parties are unable to reach
resolution as to any such outstanding Dispute within five (5) days following
delivery of a written notice from either Buyer or Seller to the other Party that
Buyer or Seller, as applicable, intends to submit such Dispute to the
Independent Expert for resolution pursuant to this Article XVIII, then any Party
may, by written notice to the other Parties (an “Election Notice”), elect to
submit such Dispute to a single arbitrator (the “Independent Expert”), who shall
be selected by mutual agreement of Buyer and Seller within fifteen (15) days
after the delivery of such Election Notice in accordance with following:

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(a)in the case of any Dispute regarding Title Defects, Title Defect Values or
Title Benefits, the Independent Expert shall be a title attorney with at least
twenty (20) years experience in oil and gas titles involving properties in the
regional area in which the Assets with respect to which such Title Defects or
Title Benefits are alleged or with respect to which such Title Defect Values in
dispute are located and who is licensed to practice law in the state in which
such Assets are located;

(b)in the case of any Dispute regarding Environmental Defects or Environmental
Defect Values, the Independent Expert shall be an environmental consultant with
at least twenty (20) years experience involving properties in the regional area
in which the Assets with respect to which such Environmental Defects are alleged
or with respect to which such Environmental Defect Values in dispute are
located;

(c)in the case of any Dispute regarding the calculation of the Final Statement
or revisions thereto, the Independent Expert shall be a senior partner of an
independent accounting firm mutually acceptable to Buyer and Seller; and

(d)in the case of any Dispute, the Independent Expert shall not have had a
substantial relationship with any Party or any Affiliate of any Party during the
two (2) years prior to such selection;

provided that, in any case, in the absence of such agreement within fifteen (15)
days of the delivery of the Election Notice, the Independent Expert shall be
selected as would a single arbitrator in accordance with the Commercial
Arbitration Rules of the American Arbitration Association (the “Rules”)
notwithstanding the selection method and criteria set forth in clauses (a)-(d)
above.

Section 18.02Additional Procedures. All proceedings under this Article XVIII
shall be held in Midland, Texas and shall be conducted in accordance with the
Rules, to the extent such Rules do not conflict with the terms of this
Article XVIII. The Independent Expert's final determination shall be made within
twenty-one (21) days after submission of the matters in dispute to the
Independent Expert, and the Independent Expert shall agree to comply with this
schedule before accepting appointment. In making its determination, the
Independent Expert shall be bound by terms of this Agreement, to the extent
applicable, and, subject to the foregoing, may consider such other matters as in
the opinion of the Independent Expert are necessary to make a proper
determination. Additionally, the Independent Expert may consult with and engage
disinterested advisors for advice, including without limitation petroleum
engineers. The Independent Expert, however, may not determine that (a) a Title
Defect Value of a Title Defect is greater than the Title Defect Value claimed by
Buyer in its applicable Title Defect Notice, (b) an Environmental Defect Value
is greater than the Environmental Defect Value claimed by Buyer in its
applicable Environmental Defect Notice, or (c) the value of a Title Benefit is
greater than the amount claimed by Seller. The Independent Expert shall act as
an expert for the limited purpose of determining the specific disputed Title
Defects, Title Defect Values, Title Benefits, Environmental Defects or
Environmental Defect Values, or calculation of the Final Statement or revisions
thereto submitted by any Party and may not award damages, interest or penalties
to any Party with respect to any matter. Seller and Buyer shall each bear their
own legal fees and other costs. Seller and Buyer shall each bear one-half of the
costs and expenses of the Independent

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Expert, including those which relate to any disinterested advisor utilized by
the Independent Expert.

Section 18.03Waiver. Notwithstanding anything to the contrary in this Agreement,
at any time Buyer may waive any Title Defect, Title Defect Value, Environmental
Defect or Environmental Defect Value previously asserted by Buyer.

Section 18.04Binding Nature. The decision and award of the Independent Expert
with respect to any arbitration under this Article XVIII shall be binding upon
the Parties and final and nonappealable to the maximum extent permitted by law,
and judgment thereon may be entered in a court of competent jurisdiction and
enforced by any Party as a final judgment of such court.

Section 18.05Confidentiality. Except to the extent necessary to enforce a
decision and award of the Independent Expert, to enforce other rights of the
Parties hereunder, or as required by applicable law or the rules of any stock
exchange on which the securities of any Party or any of their Affiliates are
listed or are in the process of being listed, the Independent Expert and
Parties, and their counsel, consultants and other representatives, shall
maintain as confidential the fact any proceedings are ongoing, or have been
completed, under this Article XVIII, any decision and award of the Independent
Expert and all documents prepared and submitted by any Party, or its counsel,
consultants and other agents and representatives, in connection with any
proceedings under this Article XVIII. The confidentiality obligations in this
Section 18.05 shall survive termination of this Agreement.

Article XIX
Miscellaneous

Section 19.01Names. As soon as reasonably possible after the Closing, but in no
event later than the forty-fifth (45th) day after the Closing, Buyer shall at
Buyer's expense remove the name of Seller and Seller's Affiliates, or any
variations on them, from all of the operated Assets and make the requisite
filings with, and provide the requisite notices to, the appropriate federal,
state or local agencies to place the title or other indicia of ownership,
including operation of the operated Assets, in a name other than the name of
Seller or any of Seller's Affiliates, or any variations of them.

Section 19.02Expenses. Except as otherwise provided in this Agreement, each
Party shall be solely responsible for all expenses, including due diligence
expenses, incurred by it in connection with this transaction, and no Party shall
be entitled to any reimbursement for such expenses from the other Party.

Section 19.03Filings, Notices and Certain Governmental Approvals. Promptly after
Closing, Buyer shall at Buyer's expense (a) record the Assignment of the Assets,
all state/federal assignments and any lien releases related to the Assets
executed or delivered at the Closing in all applicable real property records
and/or, if applicable, all state or federal agencies; (b) send notices to
vendors supplying goods and services for the Assets of the assignment of the
Assets to Buyer and, if applicable, the designation of Buyer as the operator of
the operated Assets; (c) actively pursue the unconditional approval of all
applicable Governmental Authorities of the assignment of the Assets to Buyer and
the designation of Buyer as the operator of the operated

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Assets; and (d) actively pursue all other consents and approvals that may be
required in connection with the assignment of the Assets to Buyer and the
assumption of the liabilities assumed by Buyer under this Agreement, that have
not been obtained prior to Closing. To the extent reasonably requested by
Seller, Buyer shall at Buyer's expense promptly provide Seller with copies of
all filings, approvals and consents required pursuant to this Section 19.03.
Buyer shall take any and all action required by any Governmental Authority to
obtain unconditional approval, including the posting of any and all bonds or
other security that may be required in excess of its existing lease, pipeline or
area-wide bond.

Section 19.04Document Retention. As used in this Section 19.04, the term
“Documents” means all files, documents, books, Records and other data delivered
to Buyer by Seller pursuant to the provisions of this Agreement (other than
those that Seller retained either the original or a copy of), including
financial accounting and Tax records; land, title and division of interest
files; contracts; engineering and well files; and books and records related to
the operation of the Assets prior to the Closing Date. Buyer shall retain and
preserve the Documents for a period of no less than seven (7) years following
the Closing Date (or for such longer period as may be required by Law), and
shall allow Seller or Seller's representatives to inspect the Documents at
reasonable times and upon reasonable notice during regular business hours during
such time period. Seller shall have the right during such period to make copies
of the Documents at Seller's expense.

Section 19.05Entire Agreement. This Agreement, the Confidentiality Agreement and
the documents to be executed under this Agreement constitute the entire
agreement between the Parties pertaining to the subject matter of this Agreement
and supersede all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the Parties pertaining to the subject
matter of this Agreement, the Confidentiality Agreement and the documents to be
entered into under this Agreement. Any supplement, amendment, alteration,
modification or waiver of this Agreement shall be binding only if executed in
writing by the Parties and specifically referencing this Agreement.

Section 19.06Waiver. No waiver of any of the provisions of this Agreement shall
be deemed or shall constitute a waiver of any other of its provisions (whether
or not similar), nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.

Section 19.07Construction. The captions in this Agreement are for convenience
only and shall not be considered a part of or affect the construction or
interpretation of any provision of this Agreement. The Parties acknowledge that
they have participated jointly in the negotiation and drafting of this Agreement
and as such the Parties agree that if an ambiguity or question of intent or
interpretation arises under this Agreement, this Agreement shall not be
construed more strictly against one Party than another on the grounds of
authorship.

Section 19.08No Third Party Beneficiaries. Except as provided in Section 16.04
and except for other provisions in this Agreement relating to Buyer's
obligations to Seller Indemnitees, nothing in this Agreement shall provide any
benefit to any Third Party or entitle any Third Party to any claim, cause of
action, remedy or right of any kind, it being the intent of the Parties that
this Agreement shall otherwise not be construed as a Third Party beneficiary
contract.

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Section 19.09Assignment. Except as otherwise provided in Article VIII, a Party
may assign or delegate any of its rights or duties under this Agreement only
with the prior written consent of the other Party, and any assignment made
without such consent shall be void. Except as otherwise provided in this
Agreement, this Agreement shall be binding upon and inure to the benefit of the
Parties and their respective permitted successors, assigns and legal
representatives.

Section 19.10Governing Law. THIS AGREEMENT AND THE LEGAL RELATIONS AMONG THE
PARTIES SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF TEXAS, EXCLUDING ANY CONFLICT OF LAWS RULE OR PRINCIPLE THAT MIGHT REFER
CONSTRUCTION OF SUCH PROVISIONS TO THE LAWS OF ANOTHER JURISDICTION.

Section 19.11Jurisdiction. THE PARTIES CONSENT TO THE EXERCISE OF JURISDICTION
IN PERSONAM BY THE COURTS OF THE STATE OF TEXAS FOR ANY ACTION ARISING OUT OF
THIS AGREEMENT OR THE OTHER DOCUMENTS EXECUTED PURSUANT TO OR IN CONNECTION WITH
THIS AGREEMENT. ALL ACTIONS OR PROCEEDINGS WITH RESPECT TO, ARISING DIRECTLY OR
INDIRECTLY IN CONNECTION WITH, OUT OF, RELATED TO, OR FROM THIS AGREEMENT OR THE
OTHER DOCUMENTS EXECUTED PURSUANT TO OR IN CONNECTION WITH THIS AGREEMENT SHALL
BE LITIGATED (IF AT ALL) ONLY IN THE DISTRICT COURTS OF TEXAS IN MIDLAND COUNTY
OR (IF IT HAS JURISDICTION) THE UNITED STATES DISTRICT COURT FOR THE WESTERN
DISTRICT OF TEXAS. EACH PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 19.12Notices. Any notice, communication, request, instruction or other
document required or permitted under this Agreement shall be given in writing
and delivered in person or by courier, email or facsimile to the addresses of
Seller and Buyer set forth below. Any such notice shall be effective only upon
receipt.
Seller:
COG Operating LLC

Concho Oil & Gas LLC
One Concho Center
600 W. Illinois Ave.
Midland, Texas 79701
Attention: General Counsel
Email: WGiraud@concho.com
Fax: 432-683-7441

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Buyer:    Legacy Reserves Operating LP
303 W. Wall, Suite 1400
Midland, Texas 79701
Attention: Kyle A. McGraw
Fax: 432-684-3774

Any Party may, by written notice so delivered to the other Party, change its
address for notice purposes under this Agreement.
Section 19.13Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect and the Parties shall negotiate in good faith to
modify this Agreement so as to effect their original intent as closely as
possible in an acceptable manner to the end that the transactions contemplated
by this Agreement are fulfilled to the extent possible.

Section 19.14Survival. The representations and warranties of Seller set forth in
Sections 6.06 through 6.17 and the covenants and agreements of Seller and Buyer
to be performed prior to or at the Closing shall terminate upon the Closing and
be of no further force or effect. The representations and warranties of Seller
set forth in Sections 6.01 through 6.05 shall survive the Closing for a period
of one (1) year. All other representations, warranties, covenants and agreements
shall survive the Closing indefinitely; provided that nothing herein shall
extend the one (1) year period after Closing in which Buyer may send a Claim
Notice claiming indemnification in accordance with Section 16.04(a). The
obligations and covenants of Buyer under this Agreement that survive the Closing
shall be deemed covenants running with the land.

Section 19.15Time of the Essence. Time shall be of the essence with respect to
all time periods and notice periods set forth in this Agreement, provided,
however, that a Party shall not be considered to be in “material breach” of this
Agreement for its breach of any timing-specific requirement contained herein. If
the date specified in this Agreement for giving any notice or taking any action
is not a Business Day (or if the period during which any notice is required to
be given or any action taken expires on a date which is not a Business Day),
then the date for giving such notice or taking such action (and the expiration
of such period during which notice is required to be given or action taken)
shall be the next day which is a Business Day.

Section 19.16Counterpart Execution. This Agreement may be executed in any number
of counterparts (including by facsimile or email transmission), and each such
counterpart shall be effective as to each Party that executes the same whether
or not all of the Parties execute the same counterpart. If counterparts of this
Agreement are executed, the signature pages from various counterparts may be
combined into one composite instrument for all purposes. All counterparts
together shall constitute only one Agreement, but each counterpart shall be
considered an original.

Section 19.17Knowledge. Whenever a statement in this Agreement is qualified by a
phrase such as to Seller's “Knowledge,” the Parties intend that the only
information to be attributed to Seller is information actually known by a
current officer of Seller who devotes attention to such matters during the
course of his or her employment.

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Section 19.18Press Releases. Neither Seller nor Buyer, nor any Affiliate
thereof, shall make any press release regarding the existence of this Agreement,
the contents hereof, or the transactions contemplated hereby without (a) in the
case of announcements by Seller or Seller's Affiliates, the prior written
consent of Buyer, which consent shall not be unreasonably withheld or delayed,
or (b) in the case of announcements by Buyer or its Affiliates, the prior
written consent of Seller, which consent shall not be unreasonably withheld or
delayed; provided, however, the foregoing shall not restrict disclosures by
Buyer or Seller (i) to the extent that such disclosures are required by
applicable securities or other Law or the applicable rules of any stock exchange
having jurisdiction over the disclosing Party or its Affiliates, or (ii) to
Governmental Authorities and Third Parties holding preferential rights to
purchase, rights of consent or other rights that may be applicable to the
transactions contemplated by this Agreement, as reasonably necessary to provide
notices, seek waivers, amendments or terminations of such rights, or seek such
consents. Seller and Buyer shall each be liable for the compliance of their
respective Affiliates with the terms of this Section 19.18.

Section 19.19Exclusivity; Waiver of Rescission.

(a)Buyer agrees that after Closing, in relation to any breach, default, or
nonperformance of any representation, warranty, covenant, or agreement made or
entered into by Seller pursuant to this Agreement or any certificate,
instrument, or document delivered pursuant hereto or with respect to the
Retained Obligations, the relief and remedy available to Buyer in respect of
said liability, breach, default, or nonperformance shall be limited to the
extent properly claimable hereunder or under the Assignment and subject to the
terms and provisions of Article XVI, Section 4.06 and the Assignment.

(b)Buyer acknowledges that, following the Closing, the payment of money, as
limited by the terms of this Agreement, shall be adequate compensation for
breach of any representation, warranty, covenant or agreement contained herein
or for any other claim arising in connection with or with respect to the
transactions contemplated by this Agreement. As the payment of money shall be
adequate compensation, following the Closing, Buyer waives any right to rescind
this Agreement or any of the transactions contemplated hereby.

Section 19.20Waiver of Trade Practices Act.

(a)It is the intention of the parties that Buyer's rights and remedies with
respect to this transaction and with respect to all acts or practices of Seller,
past, present or future, in connection with this transaction shall be governed
by legal principles other than the Texas Deceptive Trade Practices-Consumer
Protection Act, Tex. Bus. & Com. Code Ann. § 17.41 et seq. (the "DTPA"). As
such, Buyer hereby waives the applicability of the DTPA to this transaction and
any and all duties, rights or remedies that might be imposed by the DTPA,
whether such duties, rights and remedies are applied directly by the DTPA itself
or indirectly in connection with other statutes. Buyer acknowledges, represents
and warrants that it is purchasing the goods and/or services covered by this
Agreement for commercial or business use; that it has assets of $25,000,000 or
more according to its most recent financial statement prepared in accordance
with GAAP; that it has knowledge and experience in financial and business
matters that enable it to

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evaluate the merits and risks of a transaction such as this; and that it is not
in a significantly disparate bargaining position with Seller.

(b)Buyer expressly recognizes that the price for which Seller has agreed to
perform Seller's obligations under this Agreement has been predicated upon the
inapplicability of the DTPA and this waiver of the DTPA. Buyer further
recognizes that Seller, in determining to proceed with the entering into this
Agreement, has expressly relied on this waiver and the inapplicability of the
DTPA.

(c)In addition to the foregoing, and in order to ensure compliance with Texas'
DTPA Section 17.42(c), Buyer waives all rights it may possess, if any, under the
DTPA with the following certification:

WAIVER OF RIGHTS

BUYER WAIVES ITS RIGHTS UNDER THE DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION
ACT, SECTION 17.41 ET SEQ., BUSINESS & COMMERCE CODE, A LAW THAT GIVES CONSUMERS
SPECIAL RIGHTS AND PROTECTIONS. AFTER CONSULTATION WITH AN ATTORNEY OF ITS OWN
SELECTION, BUYER VOLUNTARILY CONSENTS TO THIS WAIVER.

[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]

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IN WITNESS WHEREOF, Seller and Buyer have executed and delivered this Agreement
as of the date first set forth above
 
 
SELLER:
 
 
 
COG OPERATING LLC
 
 
 
 
 
 
 
 
By:
/s/ C. William Giraud
 
 
 
 
C. William Giraud
 
 
 
 
Senior Vice President, General Counsel and Corporate Secretary
 
 
 
 
 
 
 
 
CONCHO OIL & GAS LLC
 
 
 
 
 
 
 
 
By:
/s/ C. William Giraud
 
 
 
 
C. William Giraud
 
 
 
 
Senior Vice President, General Counsel and Corporate Secretary
 
 
 
 
 
 
 
 
BUYER:
 
 
 
 
 
 
 
 
LEGACY RESERVES OPERATING LP
 
 
 
 
 
 
 
 
By:
Legacy Reserves Operating GP LLC,
 
 
 
 
Its General Partner
 
 
 
By:
Legacy Reserves LP,
 
 
 
 
Its Sole Member
 
 
 
By:
Legacy Reserves GP, LLC,
 
 
 
 
Its General Partner
 
 
 
 
 
 
 
 
By:
/s/ Kyle A. McGraw
 
 
 
 
Kyle A. McGraw
 
 
 
 
Executive Vice President and Chief Development Officer
 

Signature Page to
Purchase and Sale Agreement

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EXHIBIT C

Attached to Purchase and Sale Agreement dated November 5, 2012, among COG
Operating LLC, COG Oil & Gas LLC, together as Seller, and Legacy Reserves
Operating LP, as Buyer.
ASSIGNMENT AND BILL OF SALE

THIS ASSIGNMENT AND BILL OF SALE (this "Assignment"), effective as of 7:00 a.m.
local time where the Assets (defined below) are located on October 1, 2012 (the
"Effective Time"), is made from COG OPERATING LLC, a Delaware limited liability
company, COG OIL & GAS LLC, a Texas limited liability company (together,
"Assignor), each of whose address is One Concho Center, 600 W. Illinois Avenue,
Midland, Texas 79701, to LEGACY RESERVES OPERATING LP, a Delaware limited
partnership ("Assignee"), whose address is 303 W. Wall, Suite 1400, Midland,
Texas 79701. Assignor and Assignee are collectively referred to as the
"Parties," and are sometimes referred to individually as a "Party." Capitalized
terms used and not otherwise defined shall have the meaning assigned to them in
the Purchase and Sale Agreement dated November 5, 2012 by and among Assignor and
Assignee (the "Purchase and Sale Agreement").
ARTICLE I
Granting and Habendum

For Ten Dollars ($10.00) and other good and valuable consideration, the receipt,
and sufficiency of which are hereby acknowledged, Assignor does hereby grant,
bargain, sell, transfer, convey, set over, assign and deliver unto Assignee, its
successors and assigns, effective for all purposes as of the Effective Time and
subject to the matters set forth in this Assignment, the Assets. The term
"Assets" (or in the singular "Asset") means all of Assignor's right, title and
interest in and to the following, less and except the Excluded Assets (as
defined below):
(a) the oil, gas and/or mineral leases described in Exhibit A attached hereto,
together with all amendments, supplements, renewals, extensions or ratifications
thereof, insofar and only insofar as said leases cover the lands and depths
described in Exhibit A attached hereto (collectively, the "Leases"), and all
oil, gas and/or mineral leasehold interests, reversionary, back-in, net profits,
carried, convertible, non-consent and overriding royalty interests, operating
rights, record title and other similar interests in the Leases (collectively,
the "Subject Interests" or, singularly, a "Subject Interest");

(b)    except to the extent as may be limited by the Subject Interests or to the
extent used or held in connection with the Excluded Assets, all rights,
privileges, benefits and powers conferred upon Assignor, as holder of the
Subject Interests, with respect to (i) all rights of use and occupation of the
surface of and the subsurface depths under the Subject Interests, and (ii) all
rights with respect to any pooled, communitized or unitized acreage by virtue of
any Subject Interest being a part thereof, including all Hydrocarbon (as defined
below) production after the Effective Time attributable to the Subject Interests
or any such pool or unit allocated to any such Subject Interest;

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(c)    to the extent assignable or transferable by Assignor, all easements,
rights-of-way, surface leases, servitudes, permits, licenses, franchises and
other estates or similar rights and privileges directly related to and to the
extent used in connection with the Subject Interests, including, without
limitation, those described or referred to in Exhibit A-1 attached hereto (the
"Easements");

(d)    to the extent assignable or transferable by Assignor and to the extent
not used or held in connection with the Excluded Assets, all personal property,
equipment, fixtures, inventory and improvements located on and used directly in
connection with the Subject Interests or the Easements or with the production,
treatment, sale, or disposal of oil, gas or other hydrocarbons produced from or
attributable to the Subject Interests (collectively, "Hydrocarbons"), byproducts
or waste produced from or attributable to the foregoing, including, without
limitation, all wellhead equipment, pumps, pumping units, flowlines, gathering
systems, piping, tanks, buildings, treatment facilities, disposal facilities,
compression facilities, and other materials, supplies, equipment, facilities and
machinery (collectively, "Personal Property");

(e)    all wells, to the extent not used or held in connection with the Excluded
Assets, which are located on the lands covered by the Subject Interests or on
lands with which the Subject Interests may have been pooled, communitized or
unitized (whether producing, shut in or abandoned), including, without
limitation, the wells described in Exhibit B attached hereto;

(f)    to the extent assignable or transferable by Assignor and to the extent
not used or held in connection with the Excluded Assets, all contracts,
warranties, agreements and other arrangements, and all express and implied
rights that directly relate to the Subject Interests, the Leases or the
Easements, including, without limitation, communitization, unitization or
pooling agreements, production sales contracts, farmout agreements, subleases,
joint venture or partnership agreements, operating agreements, service
agreements, declarations and orders, exploration agreements, transportation or
gathering agreements, agreements for the sale and purchase of Hydrocarbons, the
electricity contracts set forth on Schedule 2.02(f) attached hereto, but only to
the extent expressly set forth on such schedule, processing agreements and other
similar contracts, agreements and other arrangements (the "Contracts"), provided
that "Contracts" shall not include the instruments constituting the Leases; and

(g)    to the extent assignable or transferable by Assignor and to the extent
not used or held in connection with the Excluded Assets, all books, records,
files, muniments of title, reports and similar documents and materials,
including lease records, well records, and division order records, well files,
well logs, title records (including abstracts of title, title opinions and
memoranda, and title curative documents directly related to the Assets),
contracts, contract files and correspondence, that directly relate to the
foregoing interests in the possession of, and maintained by, Assignor
(collectively, the "Records"), provided, however, that Assignor may retain the
copies of such Records as Assignor has reasonably determined may be required for
existing litigation, tax, accounting and auditing purposes.

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NOTWITHSTANDING THE FOREGOING, the Assets shall not include, and there is
excepted, reserved and excluded from the assignment under this Assignment the
following (collectively, the "Excluded Assets"):

(a)    all fee mineral, royalty and other similar non-leasehold oil, gas or
other mineral interests and estates, and all surface fee interests, in the lands
covered by the Leases or used or held in connection with the Assets;

(b)    all trade credits and all accounts, accounts receivable, checks, funds,
promissory notes, instruments and general intangibles (as such terms are defined
in the Texas Uniform Commercial Code) attributable to the Assets with respect to
any period of time prior to the Effective Time;

(c)    all claims of Assignor for, and rights of Assignor to, refunds of or loss
carryovers with respect to (i) any Taxes with respect to the Assets for any
taxable year or period, or portion thereof, that ends at or before the Effective
Time, (ii) any Taxes with respect to the Excluded Assets, or (iii) those other
refunds, and rights to them, for amounts paid in connection with the Assets and
attributable to the period prior to the Effective Time, including, without
limitation, refunds of amounts paid under any Hydrocarbon gathering or
transportation agreement; and for purposes of this Assignment, the term "Taxes"
means any and all taxes, including any interest, penalties or other additions to
tax that may become payable in respect of any tax, imposed by any governmental
authority, which taxes shall include, without limiting the generality of the
foregoing, all income taxes, profits taxes, margin taxes, alternative minimum
taxes, estimated taxes, payroll taxes, employee withholding taxes, unemployment
insurance taxes, social security taxes, welfare taxes, disability taxes,
severance taxes, license charges, sales taxes, use taxes, ad valorem taxes,
value added taxes, excise taxes, franchise taxes, gross receipts taxes, real or
personal property taxes, stamp taxes, production taxes, environmental taxes,
transfer taxes, workers' compensation taxes, windfall taxes, net worth taxes,
and other taxes, fees, duties, levies, customs, tariffs, imposts, assessments,
obligations and charges of the same or of a similar nature to any of the
foregoing;

(d)    all proceeds, income, royalties or revenues (and any security or other
deposits made) attributable to (i) the Assets for any period prior to the
Effective Time or (ii) any other Excluded Assets;

(e)    all Hydrocarbons produced from or attributable to the Subject Interests
with respect to all periods prior to the Effective Time, together with all
proceeds from the sale of those Hydrocarbons;

(f)    all geophysical data, interpretations and information related to the
Assets, and all of Assignor's proprietary or licensed computer software,
technology, patents, trade secrets, copyrights, names, trademarks, logos and
other intellectual property;

C -3

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(g)    all documents and instruments of Assignor (other than title opinions)
(i) that may be protected by an attorney-client, work product or other
privilege, (ii) prepared by or for counsel of Assignor; or (iii) received from
RBC Richardson Barr, RBC Capital Markets or any other financial, commercial or
legal advisor of Assignor (each, an "Advisor");

(h)    all (i) agreements and correspondence between Assignor or any of
Assignor's Affiliates and any Advisor relating to the transactions contemplated
in this Assignment, (ii) lists of prospective purchasers for those transactions
compiled by Assignor or any of Assignor's Affiliates or any Advisor, (iii) bids
submitted by other prospective purchasers of the Assets, (iv) analyses by
Assignor or any of Assignor's Affiliates or any Advisor of any bids submitted by
any prospective purchaser, (v) correspondence between Assignor or any of
Assignor's Affiliates or any Advisor, or any of their respective
representatives, and any prospective purchaser other than Assignee, and
(vi) correspondence between Assignor or any of Assignor's Affiliates or any
Advisor or any of their respective representatives with respect to any of the
bids, the prospective purchasers, the engagement or activities of any Advisor,
or the transactions contemplated in this Assignment; and for purposes of this
Assignment, the term "Affiliate" means, with respect to any Person, any other
Person controlling, controlled by or under common control with that Person,
where the term "control" (and correlative terms) means the power, whether by
contract, equity ownership or otherwise, to direct the policies or management of
a Person; and the term "Person" means an individual, corporation, partnership,
limited liability company, association, trust, unincorporated organization or
other entity;

(i)    all data and other information that may not be disclosed or assigned to
Assignee as a result of confidentiality or similar arrangements under agreements
with Persons not Affiliates of Assignor, even if such data or other information
is inadvertently disclosed or provided to Assignee (in which case Assignee shall
promptly return such data or information to Assignor);

(j)    all audit rights arising under any of the Contracts or otherwise with
respect to any period prior to the Effective Time or to any of the Excluded
Assets, subject to the provisions of Section 11.03 of the Purchase and Sale
Agreement;

(k)    all corporate, partnership and limited liability company financial and
income tax books, accounts, records and documents of Assignor or any of
Assignor's Affiliates;

(l)    all claims and causes of action of Assignor (i) arising from acts,
omissions or events related to, or damage to or destruction of, the Assets,
occurring prior to the Effective Time, (ii) arising under or with respect to any
of the Contracts that are attributable to periods of time prior to the Effective
Time (including claims for adjustments or refunds), or (iii) with respect to any
of the Excluded Assets;

C -4

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(m)    all rights and interests of Assignor (i) under any policy or agreement of
insurance or indemnity, (ii) under any bond, or (iii) to any insurance or
condemnation proceeds or awards arising, in each case, from acts, omissions or
events related to, or damage to or destruction of, the Assets occurring prior to
the Effective Time;

(n)    all amounts due or payable to Assignor as adjustments to insurance
premiums related to the Assets with respect to any period prior to the Effective
Time;

(o)    all amounts resulting from derivative contracts or similar agreements
used to manage oil, natural gas, products or other commodity prices whether
deemed a hedge, non-hedge or ineffective hedge transaction;

(p)    all proceeds, income, revenues or other benefits (including any benefit
attributable to any future laws or regulations with respect to "royalty relief"
or other similar measures) not otherwise enumerated above, as well as any
security or other deposits made, attributable to (i) the Assets for any period
prior to the Effective Time or (ii) the Excluded Assets;

(q)    all funds held in suspense accounts related to the Assets;

(r)    all vehicles, vessels, trailers, software, computers and associated
peripherals and all radio, telephone and other communication equipment, except
for any such equipment attached to a well included as an Asset above;

(s)    all oil, gas or other mineral reserve reports, and all environmental site
assessments, reports and related data and information;

(t)    all rights or benefits under or in connection with any State or Federal
candidate conservation agreements or similar agreements;

(u)    all books, records and files that relate to Excluded Assets;
(v)    any records retained by Assignor pursuant to Section 2.02(g) of the
Purchase and Sale Agreement;

(w)    Assignor's area-wide bonds, permits and licenses or other permits,
licenses or authorizations used in the conduct of Assignor's business generally;

(x)    all rights of Assignor in formations, strata, horizons or depths that are
excepted or excluded in the land descriptions contained in Exhibit A attached
hereto;

(y)    all rights of Assignor under the Purchase and Sale Agreement or under any
instruments executed and delivered in connection with the Closing; and

(z)    all items which would have constituted “Assets” as defined above but for,
and only to the extent of, their being used or held in connection with the
Excluded Assets, and all surface leases and the other items listed on Schedule
2.03(z) attached hereto.

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TO HAVE AND TO HOLD the Assets, together with all and singular the rights,
privileges, contracts and appurtenances, in any way appertaining or belonging to
the Assets, unto Assignee, its successors and assigns, forever, subject to the
matters set forth in this Assignment.
ARTICLE II
Special Warranty of Title and Disclaimers

Section 2.01    Special Warranty of Title. Assignor hereby agrees to WARRANT AND
FOREVER DEFEND all and singular the title to the Assets unto Assignee, its
successors and assigns, against every person whomsoever lawfully claiming or to
claim the same or any part thereof, by, through or under Assignor, but not
otherwise; subject to the Permitted Encumbrances (as such term is defined in the
Purchase and Sale Agreement), the terms and provisions of the Purchase and Sale
Agreement and the other matters set forth herein.

Section 2.02    DISCLAIMERS. WITHOUT PREJUDICE TO ANY RIGHTS OF ASSIGNEE OR
ASSIGNOR UNDER THE PURCHASE AND SALE AGREEMENT, BY ACCEPTANCE OF THIS
ASSIGNMENT:

(a)    DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. ASSIGNEE ACKNOWLEDGES AND
AGREES THAT THE EXPRESS REPRESENTATIONS AND WARRANTIES OF ASSIGNOR CONTAINED IN
THIS ASSIGNMENT AND IN THE PURCHASE AND SALE AGREEMENT ARE EXCLUSIVE AND ARE IN
LIEU OF ALL OTHER REPRESENTATIONS AND WARRANTIES, EXPRESS, IMPLIED OR STATUTORY.

(b)    SALE "AS IS" "WHERE IS". ASSIGNEE REPRESENTS THAT IT HAS INSPECTED, OR
HAS HAD THE OPPORTUNITY TO INSPECT, THE ASSETS AND ACCEPTED THE PHYSICAL AND
ENVIRONMENTAL CONDITION OF SAME ON AN "AS IS-WHERE IS" BASIS AND ASSIGNEE
FOREVER RELEASES ASSIGNOR FROM ANY LIABILITY WITH RESPECT TO THE PHYSICAL AND
ENVIRONMENTAL CONDITION OF THE ASSETS, REGARDLESS OF WHETHER CAUSED BY OR
ATTRIBUTABLE TO ASSIGNOR'S SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE,
FAULT, OR STRICT LIABILITY, AND REGARDLESS OF WHETHER ARISING DURING THE PERIOD
OF, OR FROM, OR IN CONNECTION WITH ASSIGNOR'S OWNERSHIP OF THE ASSETS OR USE OF
THE PROPERTY DESCRIBED IN THE LEASES. WITHOUT LIMITING THE FOREGOING, ASSIGNEE
WAIVES ANY RIGHT TO RECOVER FROM ASSIGNOR AND FOREVER RELEASES AND DISCHARGES
ASSIGNOR AND AGREES TO RELEASE, INDEMNIFY, DEFEND AND HOLD HARMLESS ASSIGNOR,
ASSIGNOR'S MEMBERS, MANAGERS, AFFILIATES, CO-LESSEES, CO-VENTURERS AND THEIR
RESPECTIVE OFFICERS, DIRECTORS, MANAGERS, EMPLOYEES, AGENTS, PARTNERS,
REPRESENTATIVES, MEMBERS, SHAREHOLDERS, AFFILIATES, SUBSIDIARIES, SUCCESSORS AND
ASSIGNS (COLLECTIVELY, "ASSIGNOR INDEMNITEES") FROM AND AGAINST ANY AND ALL
DAMAGES, CLAIMS, LOSSES, LIABILITIES, PENALTIES, FINES, LIENS, JUDGMENTS, COSTS
AND EXPENSES

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WHATSOEVER, INCLUDING ATTORNEYS' FEES AND COSTS, WHETHER DIRECT OR INDIRECT,
KNOWN OR UNKNOWN, FORESEEN OR UNFORESEEN, THAT MAY ARISE ON ACCOUNT OF OR IN ANY
WAY BE CONNECTED WITH THE PHYSICAL AND ENVIRONMENTAL CONDITION OF THE ASSETS OR
ANY LAW OR REGULATION APPLICABLE TO THE ASSETS, INCLUDING, WITHOUT LIMITATION,
THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT OF
1980, AS AMENDED (42 U.S.C. § 9601 et. seq.), THE RESOURCE CONSERVATION AND
RECOVERY ACT OF 1976 (42 U.S.C. § 6901 et. seq.), THE CLEAN WATER ACT (33 U.S.C.
§§ 466 et. seq.), THE SAFE DRINKING WATER ACT (14 U.S.C. §§ 1401-1450), THE
HAZARDOUS MATERIALS TRANSPORTATION ACT (49 U.S.C. § 7401 et. seq.), AS AMENDED,
THE CLEAN AIR ACT AMENDMENTS OF 1990, AND ANY OTHER APPLICABLE FEDERAL, STATE OR
LOCAL LAW, REGARDLESS OF WHETHER ARISING DURING THE PERIOD OF, OR FROM, OR IN
CONNECTION WITH, ASSIGNOR'S OWNERSHIP OF THE ASSETS OR USE OF THE PROPERTY
DESCRIBED IN THE LEASES, AND REGARDLESS OF WHETHER ATTRIBUTABLE TO THE STRICT
LIABILITY OF ASSIGNOR OR TO THE SOLE, JOINT, COMPARATIVE OR CONCURRENT
NEGLIGENCE OF ASSIGNOR, EVEN IF CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF ASSIGNOR. NOTWITHSTANDING THE FOREGOING, ASSIGNEE AND ASSIGNOR
AGREE THAT THE PROVISIONS OF THIS SECTION 2.02 ARE ALSO SUBJECT TO AND LIMITED
BY THE EXPRESS OBLIGATIONS OF ASSIGNOR CONTAINED IN THE PURCHASE AND SALE
AGREEMENT TO THE EXTENT THAT ANY OF THE FOREGOING RELATE TO INDEMNIFIED
ENVIRONMENTAL DEFECTS AND THE ENVIRONMENTAL INDEMNITY AGREEMENT.

(c)    DISCLAIMER REGARDING THE ASSETS. ASSIGNEE ACKNOWLEDGES THAT ASSIGNOR HAS
NOT MADE, AND ASSIGNOR HEREBY EXPRESSLY DISCLAIMS AND NEGATES, ANY COVENANT,
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, RELATING TO THE CONDITION OF ANY
BUILDINGS, FACILITIES, WELLS, EQUIPMENT, INVENTORY, MACHINERY, FIXTURES AND
PERSONAL/MOVABLE PROPERTY CONSTITUTING PART OF THE ASSETS (COLLECTIVELY, THE
"TANGIBLE PROPERTY"), INCLUDING (a) ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, (b) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, (c) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR SAMPLES
OF MATERIALS, (d) ANY RIGHTS OF ASSIGNEE UNDER APPROPRIATE STATUTES TO CLAIM
DIMINUTION OF CONSIDERATION OR RETURN OF THE PURCHASE PRICE, (e) ANY IMPLIED OR
EXPRESS WARRANTY OF FREEDOM FROM PATENT OR TRADEMARK INFRINGEMENT, (f) ANY
IMPLIED OR EXPRESS WARRANTY OF FREEDOM FROM HIDDEN DEFECTS OR OTHER DEFECTS,
WHETHER KNOWN OR UNKNOWN, AND (g) ANY AND ALL IMPLIED WARRANTIES EXISTING UNDER
APPLICABLE LAW IN EFFECT NOW OR IN THE FUTURE, IT BEING THE EXPRESS INTENTION OF
ASSIGNOR AND ASSIGNEE THAT THE TANGIBLE PROPERTY SHALL BE CONVEYED TO

C -7

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ASSIGNEE AS IS AND IN THEIR PRESENT CONDITION AND STATE OF REPAIR. ASSIGNEE
REPRESENTS TO ASSIGNOR THAT ASSIGNEE HAS MADE OR CAUSED TO BE MADE SUCH
INSPECTIONS WITH RESPECT TO THE TANGIBLE PROPERTY AS ASSIGNEE DEEMS APPROPRIATE
AND ASSIGNEE WILL ACCEPT THE TANGIBLE PROPERTY AS IS, WHERE IS, IN THEIR PRESENT
CONDITION AND STATE OF REPAIR.

(d)    DISCLAIMER REGARDING INFORMATION. ASSIGNOR HEREBY EXPRESSLY NEGATES AND
DISCLAIMS, AND ASSIGNEE HEREBY WAIVES, AND ACKNOWLEDGES THAT ASSIGNOR HAS NOT
MADE, ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, RELATING TO (a) THE
ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR OTHER
MATERIALS (WRITTEN, ELECTRONIC OR ORAL) NOW, IN THE PAST OR IN THE FUTURE
FURNISHED TO ASSIGNEE BY OR ON BEHALF OF ASSIGNOR, OR (b) PRODUCTION RATES,
RECOMPLETION OPPORTUNITIES, DECLINE RATES, GEOLOGICAL OR GEOPHYSICAL DATA OR
INTERPRETATIONS, THE QUALITY, QUANTITY, RECOVERABILITY OR COST OF RECOVERY OF
ANY HYDROCARBON RESERVES, ANY PRODUCT PRICING ASSUMPTIONS, OR THE ABILITY TO
SELL OR MARKET ANY HYDROCARBONS AFTER CLOSING.

ARTICLE III
Miscellaneous

Section 3.01    Construction. The captions in this Assignment are for
convenience only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Assignment. Assignor and
Assignee acknowledge that they have participated jointly in the negotiation and
drafting of this Assignment and as such they agree that if an ambiguity or
question of intent or interpretation arises under this Assignment, this
Assignment shall not be construed more strictly against one Party than another
on the grounds of authorship.

Section 3.02    No Third Party Beneficiaries. Except for the provisions of this
Assignment relating to Assignee's obligations to Assignor Indemnitees, nothing
in this Assignment shall provide any benefit to any Third Party or entitle any
Third Party to any claim, cause of action, remedy or right of any kind, it being
the intent of the Parties that this Assignment shall otherwise not be construed
as a Third Party beneficiary contract.

Section 3.03    Assignment. This Assignment shall be binding upon and inure to
the benefit of the Parties and their respective successors and permitted
assigns.

Section 3.04    Governing Law. THIS ASSIGNMENT AND THE LEGAL RELATIONS AMONG THE
PARTIES SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF TEXAS, EXCLUDING ANY CONFLICT OF LAWS RULE OR PRINCIPLE THAT MIGHT REFER
CONSTRUCTION OF SUCH PROVISIONS TO THE LAWS OF ANOTHER JURISDICTION.

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Section 3.05    Jurisdiction. ALL OF THE PARTIES CONSENT TO THE EXERCISE OF
JURISDICTION IN PERSONAM BY THE COURTS OF THE STATE OF TEXAS FOR ANY ACTION
ARISING OUT OF THIS ASSIGNMENT OR THE OTHER DOCUMENTS EXECUTED PURSUANT TO OR IN
CONNECTION WITH THIS ASSIGNMENT. ALL ACTIONS OR PROCEEDINGS WITH RESPECT TO,
ARISING DIRECTLY OR INDIRECTLY IN CONNECTION WITH, OUT OF, RELATED TO, OR FROM
THIS ASSIGNMENT OR THE OTHER DOCUMENTS EXECUTED PURSUANT TO OR IN CONNECTION
WITH THIS ASSIGNMENT SHALL BE LITIGATED (IF AT ALL) ONLY IN THE DISTRICT COURTS
OF TEXAS IN MIDLAND COUNTY OR (IF IT HAS JURISDICTION) THE UNITED STATES
DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS. EACH PARTY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS ASSIGNMENT.

Section 3.06    Counterpart Execution. This Assignment may be executed in any
number of counterparts, and each such counterpart shall be effective as to each
Party that executes the same whether or not all of Parties execute the same
counterpart. If counterparts of this Assignment are executed, the signature
pages from various counterparts may be combined into one composite instrument
for all purposes. All counterparts together shall constitute only one
Assignment, but each counterpart shall be considered an original.

Section 3.07    Recording. To facilitate the recording or filing of this
Assignment, the counterpart to be recorded in a given county may contain only
that portion of the exhibits that describes Assets located in that county. In
addition to filing this Assignment, the Parties shall execute and file with
appropriate authorities, whether federal, state or local, all forms or
instruments required by applicable law to effectuate the conveyance contemplated
hereby. Said instruments shall be deemed to contain all of the exceptions,
reservations, rights, titles and privileges set forth herein as fully as though
the same were set forth in each such instrument. The interests conveyed by such
separate assignments are the same, and not in addition to the Assets conveyed
herein.

Section 3.08    Purchase and Sale Agreement. This Assignment is made subject to
all of the terms and conditions of the Purchase and Sale Agreement.
IN WITNESS WHEREOF, this Assignment is executed by the Parties on the date of
their respective acknowledgments below, but shall be effective for all purposes
as of the Effective Time.

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ASSIGNOR:
COG OPERATING LLC

By:__________________                    
Name:_______________                    
Title:________________                    

CONCHO OIL & GAS LLC

By:__________________                                         
Name:_______________                                 
Title:________________                                         

ASSIGNEE:

LEGACY RESERVES OPERATING LP
By:    Legacy Reserves Operating GP, LLC,
its general partner

By:    Legacy Reserves LP,
its sole member

By:    Legacy Reserves GP, LLC,
its general partner

By:__________________                    
Name:________________                    
Title:_________________                    

STATE OF TEXAS            §
COUNTY OF MIDLAND        §

This instrument was acknowledged before me this ______ day of
__________________, 2012, by ___________________________________,
_______________________________ of COG OPERATING LLC, a Delaware limited
liability company, on behalf of said limited liability company.

______________________________                        
Notary Public - State of Texas

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STATE OF TEXAS            §
COUNTY OF MIDLAND        §

This instrument was acknowledged before me this ______ day of
__________________, 2012, by ___________________________________,
_______________________________ of CONCHO OIL & GAS LLC, a Texas limited
liability company, on behalf of said limited liability company.

______________________________                        
Notary Public - State of Texas

STATE OF TEXAS            §
COUNTY OF     MIDLAND        §

This instrument was acknowledged before me this ______ day of
__________________, 2012, by Legacy Reserves GP, LLC, general partner of Legacy
Reserves LP, sole member of Legacy Reserves Operating GP, LLC, general partner
of LEGACY RESERVES OPERATING LP, a Delaware limited partnership, on behalf of
said limited partnership.

                        
______________________________                        
Notary Public - State of Texas

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EXHIBIT D

Attached to Purchase and Sale Agreement dated November 5, 2012, among COG
Operating LLC, Concho Oil & Gas LLC, together as Seller, and Legacy Reserves
Operating LP, as Buyer
TITLE INDEMNITY AGREEMENT

This Title Indemnity Agreement (the “Agreement”) dated as of the ____ day of
__________, 2012, is entered into between [COG OPERATING LLC][CONCHO OIL & GAS
LLC] (“Indemnitor”) and LEGACY RESERVES OPERATING LP (“Indemnitee”). Capitalized
terms used in this Agreement and not otherwise defined shall have the meanings
assigned to them in that certain Purchase and Sale Agreement dated as of
November 5, 2012, by and among Indemnitor, [COG Operating LLC][Concho Oil & Gas
LLC] and Indemnitee (the “Purchase and Sale Agreement”).
Recitals
WHEREAS, as of the date of this Agreement, Indemnitor is selling and delivering,
and Indemnitee is purchasing and accepting, the Assets pursuant to the Purchase
and Sale Agreement; and
WHEREAS, certain asserted Title Defects have been raised by Indemnitee in
connection with its title review of the Assets and Indemnitor has agreed to
execute this Agreement to indemnify Indemnitee against the effects of such
asserted Title Defects pursuant to Section 4.05(a)(ii) of the Purchase and Sale
Agreement.
NOW, THEREFORE, in consideration of the purchase and sale as contemplated by the
Purchase and Sale Agreement and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Indemnitor and
Indemnitee agree as follows:
Agreement
1.    Title Defects. Attached to this Agreement as Exhibit A is a list of
asserted Title Defects that Indemnitor and Indemnitee have determined may affect
certain of the Assets described in Exhibit A attached hereto. Except as
otherwise expressly provided in Exhibit A attached hereto, neither Indemnitor
nor Indemnitee recognize the validity or existence of any of such asserted Title
Defects, nor is there any recognition, express or implied, by the execution of
this Agreement that any of such asserted Title Defects affect, burden or
encumber the Assets described in Exhibit A attached hereto. The Parties reserve
the right to contest with each other and/or with Third Parties the validity,
existence or effect of any or all of said asserted Title Defects in accordance
with the terms of the Purchase and Sale Agreement, and Indemnitor's obligations
under this Agreement are subject to such reserved right.

2.    Indemnity. As of the date of this Agreement, Indemnitor has executed and
delivered to Indemnitee a document entitled Assignment and Bill of Sale
conveying the Assets. Notwithstanding any provision of the Purchase and Sale
Agreement or any of the assignments or conveyances delivered at or subsequent to
the Closing, but subject to paragraph 1 above,

D-1

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Indemnitor agrees to defend, indemnify and hold Indemnitee harmless from and
against all Losses arising out of the asserted Title Defects described in
Exhibit A attached hereto, subject to the following conditions:

(a)    If Indemnitor has disputed Indemnitee's assertion of an asserted Title
Defect in accordance with the Purchase and Sale Agreement and Indemnitee's
assertion of such asserted Title Defect is determined to be invalid, incorrect
or not in compliance with the requirements of the Purchase and Sale Agreement,
then Indemnitor's obligations under this Agreement shall not cover or apply to
the portion of such asserted Title Defect that is determined to be invalid,
incorrect or not in compliance with the requirements of the Purchase and Sale
Agreement.

(b)    The indemnity under this Agreement shall be the sole and exclusive
recourse and remedy of Indemnitee with respect to the asserted Title Defects
described in Exhibit A attached hereto. All claims for indemnification by
Indemnitee under this Agreement must be asserted and resolved as provided in
Section 16.05 of the Purchase and Sale Agreement, as if this Agreement were part
of the Purchase and Sale Agreement and its Section 16.05 applied to this
paragraph 2.

(c)    Indemnitor shall have the right to conduct or cause to be conducted any
corrective actions necessary to remedy any Title Defects described in Exhibit A
attached hereto, and Indemnitee shall provide reasonable access to the Records
and cooperation as necessary for Indemnitor to carry out any such corrective
actions.

(a)In no event shall Indemnitor be liable to Indemnitee under this Agreement for
(i) an amount with respect to any asserted Title Defect that is greater than the
Indemnitee's asserted Title Defect Value for such asserted Title Defect, (ii)
any exemplary, punitive, special, indirect, consequential, remote or speculative
damages except to the extent any Indemnitee suffers such damages (including
costs of defense and reasonable attorney's fees incurred in connection with
defending against such damages) to an unaffiliated Third Party, or (iii) with
respect to each asserted Title Defect described in Exhibit A attached hereto,
the obligations and liabilities described in this Agreement to the extent
Indemnitee does not provide Indemnitor with a Claim Notice for such Title Defect
complying with Section 16.05 of the Purchase and Sale Agreement on or before the
day occurring six (6) years after the date first mentioned above.
3.    Assignment. Notwithstanding anything in this Agreement to the contrary,
neither this Agreement nor any rights, covenants, duties or obligations under
this Agreement shall be assigned or transferred in any way whatsoever by
Indemnitee except with the prior written consent of Indemnitor, which consent
Indemnitor shall be under no obligation to grant, and any assignment, transfer
or attempted assignment or transfer without such consent shall be void
ab initio.

4.    Binding Agreement. Subject to the provisions of paragraph 3 above, this
Agreement shall be binding on, and shall inure to the benefit of, Indemnitor and
Indemnitee and their respective successors and assigns.

D-2

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5.    Governing Law. THIS AGREEMENT AND THE LEGAL RELATIONS BETWEEN THE PARTIES
SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF
TEXAS, EXCLUDING ANY CONFLICT OF LAWS RULE OR PRINCIPLE THAT MIGHT REFER
CONSTRUCTION OF SUCH PROVISIONS TO THE LAWS OF ANOTHER JURISDICTION. THE PARTIES
CONSENT TO THE EXERCISE OF JURISDICTION IN PERSONAM BY THE COURTS OF THE STATE
OF TEXAS FOR ANY ACTION ARISING OUT OF THIS AGREEMENT OR THE OTHER DOCUMENTS
EXECUTED PURSUANT TO OR IN CONNECTION WITH THIS AGREEMENT. ALL ACTIONS OR
PROCEEDINGS WITH RESPECT TO, ARISING DIRECTLY OR INDIRECTLY IN CONNECTION WITH,
OUT OF, RELATED TO, OR FROM THIS AGREEMENT OR THE OTHER DOCUMENTS EXECUTED
PURSUANT TO OR IN CONNECTION WITH THIS AGREEMENT SHALL BE LITIGATED ONLY IN THE
DISTRICT COURTS OF TEXAS IN MIDLAND COUNTY OR (IF IT HAS JURISDICTION) THE
UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS. EACH PARTY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT.

6.    Severability. If any term, clause or provision of this Agreement is ever
held illegal, invalid or unenforceable, the remainder of this Agreement shall
not be affected, but shall remain in full force and effect in accordance with
the terms of this Agreement.

7.    Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to constitute one
and the same Agreement.

[SIGNATURE PAGE FOLLOWS]

D-3

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

INDEMNITOR:
[COG OPERATING LLC]
[CONCHO OIL & GAS LLC]

By:        
Name:                        
Title:                        
INDEMNITEE:
LEGACY RESERVES OPERATING LP
By: Legacy Reserves Operating GP LLC,
Its General Partner
By: Legacy Reserves LP,
Its Sole Member
By: Legacy Reserves GP, LLC,
Its General Partner

By:        
Name:                        
Title:                        

D-4

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EXHIBIT E

Attached to Purchase and Sale Agreement dated November 5, 2012, among COG
Operating LLC, Concho oil & Gas LLC, together as Seller, and Legacy Reserves
Operating LP, as Buyer
ENVIRONMENTAL INDEMNITY AGREEMENT

This Environmental Indemnity Agreement (the “Agreement”) dated as of the ____
day of __________, 2012, is entered into between [COG OPERATING LLC][CONCHO OIL
& GAS LLC] (“Indemnitor”) and LEGACY RESERVES OPERATING LP (“Indemnitee”).
Capitalized terms used in this Agreement and not otherwise defined shall have
the meanings assigned to them in that certain Purchase and Sale Agreement dated
as of November 5, 2012, by and among Indemnitor, [COG Operating LLC][Concho Oil
& Gas LLC] and Indemnitee (the “Purchase and Sale Agreement”).
Recitals
WHEREAS, as of the date of this Agreement, Indemnitor is selling and delivering,
and Indemnitee is purchasing and accepting, the Assets pursuant to the Purchase
and Sale Agreement; and
WHEREAS, certain asserted Environmental Defects have been raised by Indemnitee
in connection with its environmental review of the Assets and Indemnitor has
agreed to execute this Agreement to indemnify Indemnitee against the effects of
such asserted Environmental Defects pursuant to Section 5.04(a)(ii) of the
Purchase and Sale Agreement.
NOW, THEREFORE, in consideration of the purchase and sale as contemplated by the
Purchase and Sale Agreement and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Indemnitor and
Indemnitee agree as follows:
Agreement
1.    Environmental Defects. Attached to this Agreement as Exhibit A is a list
of asserted Environmental Defects that Indemnitor and Indemnitee have determined
may affect certain of the Assets described in Exhibit A attached hereto. Except
as otherwise expressly provided in Exhibit A attached hereto, neither Indemnitor
nor Indemnitee recognize the validity or existence of any of such asserted
Environmental Defects, nor is there any recognition, express or implied, by the
execution of this Agreement that any of such asserted Environmental Defects
affect, burden or encumber the Assets described in Exhibit A attached hereto.
The Parties reserve the right to contest with each other and/or with Third
Parties the validity, existence or effect of any or all of said asserted
Environmental Defects in accordance with the terms of the Purchase and Sale
Agreement, and Indemnitor's obligations under this Agreement are subject to such
reserved right.

2.    Indemnity. As of the date of this Agreement, Indemnitor has executed and
delivered to Indemnitee a document entitled Assignment and Bill of Sale
conveying the Assets. Notwithstanding any provision of the Purchase and Sale
Agreement or any of the assignments or

E-1

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conveyances delivered at or subsequent to the Closing, but subject to paragraph
1 above, Indemnitor agrees to defend, indemnify and hold Indemnitee harmless
from and against all Losses arising out of the asserted Environmental Defects
described in Exhibit A attached hereto, subject to the following conditions:

(a)    If Indemnitor has disputed Indemnitee's assertion of an asserted
Environmental Defect in accordance with the Purchase and Sale Agreement and
Indemnitee's assertion of such asserted Environmental Defect is determined to be
invalid, incorrect or not in compliance with the requirements of the Purchase
and Sale Agreement, then Indemnitor's obligations under this Agreement shall not
cover or apply to the portion of such asserted Environmental Defect that is
determined to be invalid, incorrect or not in compliance with the requirements
of the Purchase and Sale Agreement.

(b)    The indemnity under this Agreement shall be the sole and exclusive
recourse and remedy of Indemnitee with respect to the asserted Environmental
Defects described in Exhibit A attached hereto. All claims for indemnification
by Indemnitee under this Agreement must be asserted and resolved as provided in
Section 16.05 of the Purchase and Sale Agreement, as if this Agreement were part
of the Purchase and Sale Agreement and its Section 16.05 applied to this
paragraph 2.

(c)    Indemnitor shall have the right to conduct or cause to be conducted any
corrective actions necessary to remedy any Environmental Defects described in
Exhibit A attached hereto, and Indemnitee shall provide reasonable access and
cooperation as necessary for Indemnitor to carry out any such corrective
actions.

(d)    In no event shall Indemnitor be liable to Indemnitee under this Agreement
for (i) an amount with respect to any asserted Environmental Defect that is
greater than the Indemnitee's asserted Environmental Defect Value for such
asserted Environmental Defect, (ii) any exemplary, punitive, special, indirect,
consequential, remote or speculative damages except to the extent any Indemnitee
suffers such damages (including costs of defense and reasonable attorney's fees
incurred in connection with defending against such damages) to an unaffiliated
Third Party, or (iii) with respect to each asserted Environmental Defect
described in Exhibit A attached hereto, the obligations and liabilities
described in this Agreement to the extent Indemnitee does not provide Indemnitor
with a Claim Notice for such Environmental Defect complying with Section 16.05
of the Purchase and Sale Agreement on or before the day occurring six (6) years
after the date first mentioned above.

(e)    With respect to any claim of indemnification related to an Environmental
Defect covered by this Agreement, Indemnitor's indemnification obligation shall
be limited to the cost of the least restrictive standard or remedy acceptable
under applicable Environmental Law (including engineering or institutional
controls) based on the use of the Subject Property as of the Effective Time. If
any contamination at a Subject Property is exacerbated due to the actions,
inactions, negligence, gross negligence or willful misconduct of Indemnitee
after the Closing Date, to the extent that such exacerbation

E-2

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increases the cost of the investigation or remediation of such contamination,
Indemnitor shall not be responsible for any such increase in costs.

3.    Assignment. Notwithstanding anything in this Agreement to the contrary,
neither this Agreement nor any rights, covenants, duties or obligations under
this Agreement shall be assigned or transferred in any way whatsoever by
Indemnitee except with the prior written consent of Indemnitor, which consent
Indemnitor shall be under no obligation to grant, and any assignment, transfer
or attempted assignment or transfer without such consent shall be void ab
initio.

4.    Binding Agreement. Subject to the provisions of paragraph 3 above, this
Agreement shall be binding on, and shall inure to the benefit of, Indemnitor and
Indemnitee and their respective successors and assigns.

5.    Governing Law. THIS AGREEMENT AND THE LEGAL RELATIONS BETWEEN THE PARTIES
SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF
TEXAS, EXCLUDING ANY CONFLICT OF LAWS RULE OR PRINCIPLE THAT MIGHT REFER
CONSTRUCTION OF SUCH PROVISIONS TO THE LAWS OF ANOTHER JURISDICTION. THE PARTIES
CONSENT TO THE EXERCISE OF JURISDICTION IN PERSONAM BY THE COURTS OF THE STATE
OF TEXAS FOR ANY ACTION ARISING OUT OF THIS AGREEMENT OR THE OTHER DOCUMENTS
EXECUTED PURSUANT TO OR IN CONNECTION WITH THIS AGREEMENT. ALL ACTIONS OR
PROCEEDINGS WITH RESPECT TO, ARISING DIRECTLY OR INDIRECTLY IN CONNECTION WITH,
OUT OF, RELATED TO, OR FROM THIS AGREEMENT OR THE OTHER DOCUMENTS EXECUTED
PURSUANT TO OR IN CONNECTION WITH THIS AGREEMENT SHALL BE LITIGATED ONLY IN THE
DISTRICT COURTS OF TEXAS IN MIDLAND COUNTY OR (IF IT HAS JURISDICTION) THE
UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS. EACH PARTY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT.

6.    Severability. If any term, clause or provision of this Agreement is ever
held illegal, invalid or unenforceable, the remainder of this Agreement shall
not be affected, but shall remain in full force and effect in accordance with
the terms of this Agreement.

7.    Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to constitute one
and the same Agreement.

[SIGNATURE PAGE FOLLOWS]

E-3

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IN WITNESS WHEREOF, Indemnitor and Indemnitee have executed this Agreement as of
the date first written above.
INDEMNITOR:
[COG OPERATING LLC]
[CONCHO OIL & GAS LLC]

By:        
Name:                        
Title:                        
INDEMNITEE:
LEGACY RESERVES OPERATING LP
By: Legacy Reserves Operating GP LLC,
Its General Partner
By: Legacy Reserves LP,
Its Sole Member
By: Legacy Reserves GP, LLC,
Its General Partner

By:        
Name:                        
Title:                        

E-4