Exhibit 10.1

 

EXECUTION VERSION

 

$400,000,000

 

ANTERO RESOURCES FINANCE CORPORATION

 

7.250% Senior Notes due 2019

 

Purchase Agreement

 

July 27, 2011

 

J.P. Morgan Securities LLC

  As Representative of the

  several Initial Purchasers listed

  in Schedule 1 hereto

c/o J.P. Morgan Securities LLC

383 Madison Avenue

New York, New York 10179

 

Ladies and Gentlemen:

 

Antero Resources Finance Corporation, a Delaware corporation (the “Company”), an
indirect, wholly owned subsidiary of Antero Resources LLC, a Delaware limited
liability company (the “Parent”), proposes to issue and sell to the several
initial purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for
whom you are acting as representative (the “Representative”), $400,000,000
aggregate principal amount of its 7.250% Senior Notes due 2019 (the
“Securities”).  The Securities will be issued pursuant to an Indenture to be
dated as of August 1, 2011 (the “Indenture”) among the Company, the Parent, the
other guarantors listed in Schedule 2 hereto (together with the Parent, the
“Guarantors”) and Wells Fargo Bank, National Association, as trustee (the
“Trustee”), and will be guaranteed on an unsecured senior basis by each of the
Guarantors (the “Guarantees”).   The Company and the Guarantors are referred to
collectively herein as the “Antero Entities.”

 

The Securities will be sold to the Initial Purchasers without registration under
the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon
an exemption from registration thereunder.  The Antero Entities have prepared a
preliminary offering memorandum dated July 26, 2011(the “Preliminary Offering
Memorandum”) and will prepare an offering memorandum dated the date hereof (the
“Offering Memorandum”) setting forth information concerning the Company, the
Guarantors and the Securities.  Copies of the Preliminary Offering Memorandum
have been, and copies of the Offering Memorandum will be, delivered by the
Company to the Initial Purchasers pursuant to the terms of this purchase
agreement (this “Agreement”).  The Company hereby confirms that it has
authorized the use of the Preliminary Offering Memorandum, the other Time of
Sale Information (as defined below) and the Offering Memorandum in connection
with the offering and resale of the Securities by the Initial Purchasers in the
manner contemplated by this Agreement.  Capitalized terms used but not defined
herein shall have the meanings given to such terms in the Preliminary Offering
Memorandum.  References herein to the Preliminary Offering Memorandum, the Time
of Sale Information and the Offering Memorandum shall be deemed to refer to and
include any document incorporated by reference therein and any reference to
“amend,” “amendment” or

 

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“supplement” with respect to the Preliminary Offering Memorandum or the Offering
Memorandum shall be deemed to refer to and include any documents filed after
such date and incorporated by reference therein.  References herein to the
Preliminary Offering Memorandum, the Time of Sale Information and the Offering
Memorandum shall be deemed to refer to and include the preliminary Canadian
offering memorandum dated July 26, 2011 (the “Preliminary Canadian Offering
Memorandum”) and the Canadian offering memorandum dated the date hereof (the
“Final Canadian Offering Memorandum”), respectively.

 

At or prior to the time when sales of the Securities were first made (the “Time
of Sale”), the following information shall have been prepared (collectively, the
“Time of Sale Information”): the Preliminary Offering Memorandum, as
supplemented and amended by the written communications listed on Annex A hereto.

 

Holders of the Securities (including the Initial Purchasers and their direct and
indirect transferees) will be entitled to the benefits of a Registration Rights
Agreement, to be dated the Closing Date (as defined below), substantially in the
form attached hereto as Exhibit A, (the “Registration Rights Agreement”)
pursuant to which the Antero Entities will agree to file one or more
registration statements with the Securities and Exchange Commission (the
“Commission”) providing for the registration under the Securities Act of the
Securities or the Exchange Securities referred to (and as defined) in the
Registration Rights Agreement.

 

The Company and Guarantors hereby confirm their agreement with the several
Initial Purchasers concerning the purchase and resale of the Securities, as
follows:

 

1.             Purchase and Resale of the Securities.  a. The Company agrees to
issue and sell the Securities to the several Initial Purchasers as provided in
this Agreement, and each Initial Purchaser, on the basis of the representations,
warranties and agreements set forth herein and subject to the conditions set
forth herein, agrees, severally and not jointly, to purchase from the Company
the respective principal amount of Securities set forth opposite such Initial
Purchaser’s name in Schedule 1 hereto at a price equal to 98.50% of the
principal amount thereof plus accrued interest, if any, from August 1, 2011 to
the Closing Date.  The Company will not be obligated to deliver any of the
Securities except upon payment for all the Securities to be purchased as
provided herein.

 

(a)           The Company understands that the Initial Purchasers intend to
offer the Securities for resale on the terms set forth in the Time of Sale
Information.  Each Initial Purchaser, severally and not jointly, represents and
warrants to, and agrees with, the Company that:

 

(i)            it is a qualified institutional buyer within the meaning of Rule
144A under the Securities Act (a “QIB”) and an accredited investor within the
meaning of Rule 501(a) of Regulation D under the Securities Act (“Regulation
D”);

 

(ii)           it has not solicited offers for, or offered or sold, and will not
solicit offers for, or offer or sell, the Securities by means of any form of
general solicitation or general advertising within the meaning of Rule 502(c)
Regulation

 

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D or in any manner involving a public offering within the meaning of Section
4(2) of the Securities Act; and

 

(iii)          it has not solicited offers for, or offered or sold, and will not
solicit offers for, or offer or sell, the Securities as part of their initial
offering except:

 

(A)          within the United States to persons whom it reasonably believes to
be QIBs in transactions pursuant to Rule 144A under the Securities Act (“Rule
144A”) and in connection with each such sale, it has taken or will take
reasonable steps to ensure that the purchaser of the Securities is aware that
such sale is being made in reliance on Rule 144A; or

 

(B)           in accordance with the restrictions set forth in Annex C hereto.

 

(b)           Each Initial Purchaser acknowledges and agrees that the Company
and, for purposes of the “no registration” opinions to be delivered to the
Initial Purchasers pursuant to Sections 6(f) and 6(g), counsel for the Company
and counsel for the Initial Purchasers, respectively, may rely upon the accuracy
of the representations and warranties of the Initial Purchasers, and compliance
by the Initial Purchasers with their agreements, contained in paragraph (b)
above (including Annex C hereto), and each Initial Purchaser hereby consents to
such reliance.

 

(c)           The Company acknowledges and agrees that the Initial Purchasers
may offer and sell Securities to or through any affiliate of an Initial
Purchaser and that any such affiliate may offer and sell Securities purchased by
it to or through any Initial Purchaser.

 

(d)           The Antero Entities acknowledge and agree that the Initial
Purchasers are acting solely in the capacity of an arm’s length contractual
counterparty to the Antero Entities with respect to the offering of Securities
contemplated hereby (including in connection with determining the terms of the
offering) and not as financial advisors or fiduciaries to, or agents of, the
Antero Entities or any other person.  Additionally, neither the Representative
nor any other Initial Purchaser is advising the Company, the Guarantors or any
other person as to any legal, tax, investment, accounting or regulatory matters
in any jurisdiction.  The Antero Entities shall consult with their own advisors
concerning such matters and shall be responsible for making their own
independent investigation and appraisal of the transactions contemplated hereby,
and neither the Representative nor any other Initial Purchaser shall have any
responsibility or liability to the Company or the Guarantors with respect
thereto. Any review by the Representative or any Initial Purchaser of the
Company, the Guarantors, and the transactions contemplated hereby or other
matters relating to such transactions will be performed solely for the benefit
of the Representative or such Initial Purchaser, as the case may be, and shall
not be on behalf of the Company, the Guarantors or any other person.

 

2.             Payment and Delivery.  b. Payment for and delivery of the
Securities will be made at the offices of Simpson Thacher & Bartlett LLP at
10:00 A.M., New York City time, on August 1, 2011, or at such other time or
place on the same or such other date, not later than the

 

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fifth business day thereafter, as the Representative and the Company may agree
upon in writing.  The time and date of such payment and delivery is referred to
herein as the “Closing Date.”

 

(a)           Payment for the Securities shall be made by wire transfer in
immediately available funds to the account(s) specified by the Company to the
Representative against delivery to the nominee of The Depository Trust Company
(“DTC”), for the account of the Initial Purchasers, of one or more global notes
representing the Securities (collectively, the “Global Note”), with any transfer
taxes payable in connection with the sale of the Securities duly paid by the
Company.  The Global Note will be made available for inspection by the
Representative not later than 1:00 P.M., New York City time, on the business day
prior to the Closing Date.

 

3.             Representations and Warranties of the Antero Entities.  The
Antero Entities jointly and severally represent and warrant to each Initial
Purchaser that:

 

(a)           Preliminary Offering Memorandum, Time of Sale Information and
Offering Memorandum.  The Preliminary Offering Memorandum, as of its date, did
not, the Time of Sale Information, at the Time of Sale, did not, and at the
Closing Date, will not, and the Offering Memorandum, in the form first used by
the Initial Purchasers to confirm sales of the Securities and as of the Closing
Date, will not, contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided that
the Antero Entities make no representation or warranty with respect to any
statements or omissions made in reliance upon and in conformity with information
relating to any Initial Purchaser furnished to the Company in writing by such
Initial Purchaser through the Representative expressly for use in the
Preliminary Offering Memorandum, the Time of Sale Information or the Offering
Memorandum.

 

(b)           Additional Written Communications.  The Antero Entities (including
their agents and representatives, other than the Initial Purchasers in their
capacity as such) have not prepared, made, used, authorized, approved or
referred to and will not prepare, make, use, authorize, approve or refer to any
written communication that constitutes an offer to sell or solicitation of an
offer to buy the Securities (each such communication by the Antero Entities or
their agents and representatives (other than a communication referred to in
clauses (i), (ii) and (iii) below) an “Issuer Written Communication”) other than
(i) the Preliminary Offering Memorandum, (ii) the Offering Memorandum, (iii) the
documents listed on Annex A hereto, including a term sheet substantially in the
form of Annex B hereto, which constitute part of the Time of Sale Information,
and (iv) any electronic road show or other written communications, in each case
used in accordance with Section 4(c).  Each such Issuer Written Communication,
when taken together with the Time of Sale Information at the Time of Sale, did
not, and at the Closing Date will not, contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that the Antero Entities make no representation
and warranty with respect to any statements or omissions made in each such
Issuer Written Communication in reliance upon and in conformity with information
relating to any Initial Purchaser furnished to the Company in writing by such
Initial Purchaser through the Representative expressly for use in any Issuer
Written Communication.

 

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(c)           Incorporated Documents.  The documents incorporated by reference
in each of the Time of Sale Information and the Offering Memorandum, when filed
with the Commission, conformed or will conform, as the case may be, in all
material respects to the requirements of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), and the rules and regulations of the Commission
thereunder, and did not and will not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.

 

(d)           Financial Statements.  The financial statements and the related
notes thereto included or incorporated by reference in each of the Time of Sale
Information and the Offering Memorandum present fairly the consolidated
financial position of the Parent and its subsidiaries as of the dates indicated
and the results of their operations and the changes in their cash flows for the
periods specified; such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis
throughout the periods covered thereby; and the other financial information
included or incorporated by reference in each of the Time of Sale Information
and the Offering Memorandum has been derived from the accounting records of the
Parent and its subsidiaries and presents fairly the information shown thereby.

 

(e)           No Material Adverse Change.  Since the date of the most recent
financial statements of the Parent included or incorporated by reference in each
of the Time of Sale Information and the Offering Memorandum (i) there has not
been any change in the capital stock or long-term debt of the Parent or any of
its subsidiaries, or any dividend or distribution of any kind declared, set
aside for payment, paid or made by the Parent on any class of equity interests,
or any material adverse change, or any development involving a prospective
material adverse change, in or affecting the business, properties, management,
financial position or results of operations of the Parent and its subsidiaries
taken as a whole; (ii) neither the Parent nor any of its subsidiaries has
entered into any transaction or agreement that is material to the Parent and its
subsidiaries taken as a whole or incurred any liability or obligation, direct or
contingent, that is material to the Parent and its subsidiaries taken as a
whole; and (iii) neither the Parent nor any of its subsidiaries has sustained
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
disturbance or dispute or any action, order or decree of any court or arbitrator
or governmental or regulatory authority, except in each case as otherwise
disclosed in each of the Time of Sale Information and the Offering Memorandum.

 

(f)            Organization and Good Standing.  The Parent and each of its
subsidiaries have been duly organized and are validly existing and in good
standing under the laws of their respective jurisdictions of organization, are
duly qualified to do business and are in good standing in each jurisdiction in
which their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and have all power and
authority necessary to own or hold their respective properties and to conduct
the businesses in which they are engaged, except where the failure to be so
qualified, in good standing or have such power or authority would not,
individually or in the aggregate, have a material adverse effect on the
business, properties, management, financial position or results of operations of
the Parent and its subsidiaries taken as a whole or on the performance by the
Antero Entities of their

 

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obligations under this Agreement, the Securities and the Guarantees (a “Material
Adverse Effect”).  The Parent does not own or control, directly or indirectly,
any corporation, association or other entity other than the subsidiaries listed
in Schedule 3 to this Agreement.

 

(g)           Capitalization.  The Parent has an authorized capitalization as
set forth in each of the Time of Sale Information and the Offering Memorandum
under the heading “Capitalization”; and all the outstanding shares of capital
stock or other equity interests of each subsidiary of the Parent have been duly
and validly authorized and issued, are fully paid and non-assessable and are
owned directly or indirectly by the Parent, free and clear of any lien, charge,
encumbrance, security interest, restriction on voting or transfer or any other
claim of any third party, except as described in each of the Time of Sale
Information and the Offering Memorandum.

 

(h)           Due Authorization.  Each of the Antero Entities has full right,
power and authority to execute and deliver, as applicable, this Agreement, the
Securities, the Indenture (including each Guarantee of each of the Guarantors
set forth therein), the Exchange Securities (including the related Guarantees),
and the Registration Rights Agreement (collectively, the “Transaction
Documents”) and to perform their respective obligations hereunder and
thereunder.

 

(i)            The Indenture.  The Indenture has been duly authorized by each of
the Antero Entities and on the Closing Date will be duly executed and delivered
by each of the Antero Entities and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will constitute a
valid and legally binding agreement of each of the Antero Entities enforceable
against each of the Antero Entities in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting the enforcement of creditors’ rights generally or by equitable
principles (whether considered in a proceeding at law or in equity) relating to
enforceability (collectively, the “Enforceability Exceptions”).

 

(j)            The Securities and the Guarantees.  The Securities have been duly
authorized for issuance and sale by the Company pursuant to this Agreement and
the Indenture and, when duly executed, authenticated, issued and delivered as
provided in the Indenture and paid for as provided herein, will be duly and
validly issued and outstanding and will constitute valid and legally binding
obligations of the Company enforceable against the Company in accordance with
their terms, subject to the Enforceability Exceptions, and will be entitled to
the benefits of the Indenture; and the Guarantees have been duly authorized for
issuance by each of the Guarantors pursuant to this Agreement and the Indenture
and, when the Securities have been duly executed, authenticated, issued and
delivered as provided in the Indenture and paid for as provided herein, will be
valid and legally binding obligations of each of the Guarantors, enforceable
against each of the Guarantors in accordance with their terms, subject to the
Enforceability Exceptions, and will be entitled to the benefits of the
Indenture.

 

(k)           The Exchange Securities.  On the Closing Date, the Exchange
Securities (including the related Guarantees) will have been duly authorized for
issuance by each of the Antero Entities and, when duly executed, authenticated,
issued and delivered as contemplated by the Registration Rights Agreement, will
be duly and validly issued and outstanding and will constitute valid and legally
binding obligations of the Company, as issuer, and each of the

 

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Guarantors, as guarantor, enforceable against each of the Antero Entities in
accordance with their terms, subject to the Enforceability Exceptions, and will
be entitled to the benefits of the Indenture.

 

(l)            Purchase and Registration Rights Agreements.  This Agreement has
been duly authorized, executed and delivered by each of the Antero Entities; and
the Registration Rights Agreement has been duly authorized by each of the Antero
Entities and on the Closing Date will be duly executed and delivered by each of
the Antero Entities and, when duly executed and delivered in accordance with its
terms by each of the parties thereto, the Registration Rights Agreement will
constitute a valid and legally binding agreement of each of the Antero Entities
enforceable against each of the Antero Entities in accordance with its terms,
subject to the Enforceability Exceptions, and except that rights to indemnity
and contribution thereunder may be limited by applicable law and public policy.

 

(m)          Descriptions of the Transaction Documents.  Each Transaction
Document conforms in all material respects to the description thereof contained
in each of the Time of Sale Information and the Offering Memorandum.

 

(n)           No Violation or Default.  Neither the Parent nor any of its
subsidiaries is (i) in violation of its charter or by-laws or similar
organizational documents; (ii) in default, and no event has occurred that, with
notice or lapse of time or both, would constitute such a default, in the due
performance or observance of any term, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Parent or any of its subsidiaries is a party or by which
the Parent or any of its subsidiaries is bound or to which any of the property
or assets of the Parent or any of its subsidiaries is subject; or (iii) in
violation of any law or statute or any judgment, order, rule or regulation of
any court or arbitrator or governmental or regulatory authority, except, in the
case of clauses (ii) and (iii) above, for any such default or violation that
would not, individually or in the aggregate, have a Material Adverse Effect.

 

(o)           No Conflicts.  The execution, delivery and performance by each of
the Antero Entities of each of the Transaction Documents to which each is a
party, the issuance and sale of the Securities (including the related
Guarantees) and compliance by each of the Antero Entities with the terms thereof
and the consummation of the transactions contemplated by the Transaction
Documents will not (i) conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Parent or any of its subsidiaries pursuant to, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Parent or any of its subsidiaries is a party or by which the Parent or
any of its subsidiaries is bound or to which any of the property, right or
assets of the Parent or any of its subsidiaries is subject, (ii) result in any
violation of the provisions of the charter or by-laws or similar organizational
documents of the Parent or any of its subsidiaries or (iii) result in the
violation of any law or statute or any judgment, order, rule or regulation of
any court or arbitrator or governmental or regulatory authority, except, in the
case of clauses (i) and (iii) above, for any such conflict, breach, violation or
default that would not, individually or in the aggregate, have a Material
Adverse Effect.

 

(p)           No Consents Required.  No consent, approval, authorization, order,
registration or qualification of or with any court or arbitrator or governmental
or regulatory

 

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authority is required for the execution, delivery and performance by each of the
Antero Entities of each of the Transaction Documents to which each is a party,
the issuance and sale of the Securities (including the related Guarantees) and
compliance by each of the Antero Entities with the terms thereof and the
consummation of the transactions contemplated by the Transaction Documents,
except for such consents, approvals, authorizations, orders and registrations or
qualifications as may be required (i) under applicable state securities laws in
connection with the purchase and resale of the Securities by the Initial
Purchasers and (ii) with respect to the Exchange Securities (including the
related Guarantees), under the Securities Act, the Trust Indenture Act of 1939,
as amended, and applicable state securities laws as contemplated by the
Registration Rights Agreement and except for such consents, approvals,
authorizations, orders, registrations or qualifications which, if not obtained
or made, would not, individually or in the aggregate, have a material adverse
effect on the ability of the Antero Entities to consummate the transactions
contemplated hereunder.

 

(q)           Legal Proceedings.  Except as described in each of the Time of
Sale Information and the Offering Memorandum, there are no legal, governmental
or regulatory investigations, actions, suits or proceedings pending to which the
Parent or any of its subsidiaries is or may be a party or to which any property,
right or asset of the Parent or any of its subsidiaries is or may be the subject
that, individually or in the aggregate, if determined adversely to the Parent or
any of its subsidiaries, could reasonably be expected to have a Material Adverse
Effect; and to the knowledge of the Antero Entities, no such investigations,
actions, suits or proceedings are threatened or contemplated by any governmental
or regulatory authority or by others.

 

(r)            Independent Accountants.  KPMG LLP, which has certified certain
financial statements of the Parent and its subsidiaries, is an independent
public accounting firm with respect to the Parent and its subsidiaries within
the applicable rules and regulations adopted by the Commission and the Public
Company Accounting Oversight Board (United States) and as required by the
Securities Act.

 

(s)           Reserve Data.  The oil and natural gas reserve estimates of the
Parent and its subsidiaries as of December 31, 2008, 2009 and 2010 and June 30,
2011 contained or incorporated by reference in the Preliminary Offering
Memorandum, the Time of Sale Information and the Offering Memorandum are derived
from reports that have been prepared (or, in the case of the estimates as of
June 30, 2011, audited) by either (a) DeGolyer and MacNaughton, (b) Ryder Scott
Company, L.P. or (c) Wright & Co., as set forth and to the extent indicated
therein, and such estimates fairly reflect, in all material respects, the oil
and natural gas reserves of the Parent and its subsidiaries, at the dates
indicated therein and are in accordance, in all material respects, with
Commission rules and guidelines that are currently in effect for oil and gas
producing companies applied on a consistent basis throughout the periods
involved.

 

(t)            Independent Petroleum Engineers.  Each of DeGolyer and
MacNaughton, Ryder Scott Company, L.P. and Wright & Co. have represented to the
Parent that they are, and the Parent believes them to be, independent petroleum
engineers with respect to the Parent and its subsidiaries for the periods set
forth in the Time of Sale Information and the Offering Memorandum.

 

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(u)           Title to Real and Personal Property.  The Parent and its
subsidiaries have good and marketable title to, or have valid rights to lease or
otherwise use, all items of real and personal property that are material to the
respective businesses of the Parent and its subsidiaries, in each case free and
clear of all liens, encumbrances, claims and defects and imperfections of title
except those that (i) do not materially interfere with the use made and proposed
to be made of such property by the Parent and its subsidiaries or (ii) could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

 

(v)           Title to Intellectual Property.  The Parent and its subsidiaries
own or possess adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service mark
registrations, copyrights, licenses and know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) necessary for the conduct of their respective businesses.

 

(w)          No Undisclosed Relationships.  No relationship, direct or indirect,
exists between or among the Parent or any of its subsidiaries, on the one hand,
and the directors, officers, stockholders or other affiliates of the Parent or
any of its subsidiaries, on the other, that would be required by the Securities
Act to be described in a registration statement to be filed with the Commission
and that is not so described in each of the Time of Sale Information and the
Offering Memorandum.

 

(x)            Investment Company Act.  Neither the Parent nor any of its
subsidiaries is, and after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in each of
the Time of Sale Information and the Offering Memorandum none of them will be,
an “investment company” within the meaning of the Investment Company Act of
1940, as amended, and the rules and regulations of the Commission thereunder
(collectively, the “Investment Company Act”).

 

(y)           Taxes.  The Parent and its subsidiaries have paid all federal,
state, local and foreign taxes and filed all tax returns required to be paid or
filed through the date hereof; and except as otherwise disclosed in each of the
Time of Sale Information and the Offering Memorandum or as would not,
individually or in the aggregate, have a Material Adverse Effect, there is no
tax deficiency that has been, or could reasonably be expected to be, asserted
against the Parent or any of its subsidiaries or any of their respective
properties or assets.

 

(z)            Licenses and Permits.  The Parent and its subsidiaries possess
all licenses, certificates, permits and other authorizations issued by, and have
made all declarations and filings with, the appropriate federal, state, local or
foreign governmental or regulatory authorities that are necessary for the
ownership or lease of their respective properties or the conduct of their
respective businesses as described in each of the Time of Sale Information and
the Offering Memorandum, except where the failure to possess or make the same
would not, individually or in the aggregate, have a Material Adverse Effect; and
except as described in each of the Time of Sale Information and the Offering
Memorandum, neither the Parent nor any of its subsidiaries has received notice
of any revocation or modification of any such license, certificate, permit or
authorization or has any reason to believe that any such license, certificate,
permit or authorization will not be renewed in the ordinary course.

 

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(aa)         No Labor Disputes.  No labor disturbance by or dispute with
employees of the Parent or any of its subsidiaries exists or, to the knowledge
of each of the Antero Entities, is contemplated or threatened and neither the
Company nor any Guarantor is aware of any existing or imminent labor disturbance
by, or dispute with, the employees of any of the Parent’s or any of the Parent’s
subsidiaries’ principal suppliers, contractors or customers, except as would not
have a Material Adverse Effect.

 

(bb)         Compliance With Environmental Laws.  Except as described in each of
the Time of Sale Information and the Offering Memorandum: (i) the Parent and its
subsidiaries (x) are and, during the relevant time periods specified in all
applicable statutes of limitations, have been in compliance with all applicable
federal, state, local and foreign laws, rules, regulations, requirements,
decisions and orders relating to the protection of human health or safety (to
the extent such human health or safety protection is related to exposure to
hazardous or toxic substances or wastes, pollutants or contaminants), the
environment, natural resources, hazardous or toxic substances or wastes,
pollutants or contaminants (collectively, “Environmental Laws”), (y) have
received and are in compliance with all permits, licenses, certificates or other
authorizations or approvals required of them under applicable Environmental Laws
to conduct their respective businesses, and (z) have not received any written
notice of any actual or potential liability under or relating to any
Environmental Laws, including for the investigation or remediation of any
disposal or release of hazardous or toxic substances or wastes, pollutants or
contaminants, and have no knowledge of any event or condition that would
reasonably be expected to result in any such notice; (ii) there are no costs or
liabilities associated with Environmental Laws of or relating to the Parent or
its subsidiaries, except in the case of each of (i) and (ii) above, for any such
failure to comply, or failure to receive required permits, licenses or
approvals, or cost or liability, as would not, individually or in the aggregate,
have a Material Adverse Effect; and (iii) there are no proceedings that are
pending or, to the knowledge of the Antero Entities, threatened against the
Parent or any of its subsidiaries under any Environmental Laws in which a
governmental entity is also a party, other than such proceedings regarding which
it is reasonably believed no monetary sanctions of $100,000 or more will be
imposed.

 

(cc)         Compliance With ERISA.  Each employee benefit plan, within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”), that is maintained, administered or contributed to by the
Company or any of its affiliates for employees or former employees of the
Company and its affiliates has been maintained in compliance in all material
respects with its terms and the requirements of any applicable statutes, orders,
rules and regulations, including, but not limited to, ERISA and the Internal
Revenue Code of 1986, as amended (the “Code”); no prohibited transaction, within
the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred
with respect to any such plan excluding transactions effected pursuant to a
statutory or administrative exemption, and transactions which, individually or
in the aggregate, would not have a Material Adverse Effect, and no such plan is
subject to the funding rules of Section 412 of the Code or Section 302 of ERISA.

 

(dd)         Disclosure Controls.  The Parent and its subsidiaries maintain an
effective system of “disclosure controls and procedures” (as defined in Rule
13a-15(e) of the Exchange Act) that is designed to ensure that information
required to be disclosed by the Company in reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported within
the

 

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time periods specified in the Commission’s rules and forms, including controls
and procedures designed to ensure that such information is accumulated and
communicated to the Parent’s management as appropriate to allow timely decisions
regarding required disclosure.  The Parent and its subsidiaries have carried out
evaluations of the effectiveness of their disclosure controls and procedures as
required by Rule 13a-15 of the Exchange Act.

 

(ee)         Accounting Controls.  The Parent and its subsidiaries maintain
systems of internal accounting controls sufficient to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally
accepted accounting principles, including, but not limited to internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences. There are no material weaknesses or significant
deficiencies in the Parent’s internal controls.

 

(ff)           Insurance.  The Parent and its subsidiaries have insurance
covering their respective properties, operations, personnel and businesses,
which insurance is in reasonable amounts and insures against such losses and
risks as are reasonably adequate to protect the Parent and its subsidiaries and
their respective businesses; and neither the Parent nor any of its subsidiaries
has (i) received notice from any insurer or agent of such insurer that capital
improvements or other expenditures are required or necessary to be made in order
to continue such insurance or (ii) any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage at reasonable cost from similar insurers as may be
necessary to continue its business.

 

(gg)         No Unlawful Payments.  Neither the Parent nor any of its
subsidiaries nor, to the best knowledge of each of the Antero Entities, any
director, officer, agent, employee or other person associated with or acting on
behalf of the Parent or any of its subsidiaries has (i) used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; (ii) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from
corporate funds; (iii) violated or is in violation of any provision of the
Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.

 

(hh)         Compliance with Money Laundering Laws.  The operations of the
Parent and its subsidiaries are and have been conducted at all times in
compliance with applicable financial recordkeeping and reporting requirements of
the Currency and Foreign Transactions Reporting Act of 1970, as amended, the
money laundering statutes of all jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the “Money
Laundering Laws”) and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Parent or
any of its subsidiaries with respect to the Money Laundering Laws is pending or,
to the best knowledge of the Parent, threatened.

 

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(ii)           Compliance with OFAC.  None of the Parent, any of its
subsidiaries or, to the knowledge of the Parent, any director, officer, agent,
employee or affiliate of the Parent or any of its subsidiaries is currently
subject to any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Department of the Treasury (“OFAC”); and the Parent will not
directly or indirectly use the proceeds of the offering of the Securities
hereunder, or lend, contribute or otherwise make available such proceeds to any
subsidiary, joint venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any U.S. sanctions
administered by OFAC.

 

(jj)           Solvency.  On and immediately after the Closing Date, the Parent
and its subsidiaries (after giving effect to the issuance of the Securities and
the other transactions related thereto as described in each of the Time of Sale
Information and the Offering Memorandum) will be Solvent.  As used in this
paragraph, the term “Solvent” means, with respect to a particular date, that on
such date (i) the present fair market value (or present fair saleable value) of
the assets of the Parent and its subsidiaries are not less than the total amount
required to pay the liabilities of the Parent and its subsidiaries on their
total existing debts and liabilities (including contingent liabilities) as they
become absolute and matured; (ii) the Parent and its subsidiaries are able to
realize upon their assets and pay their debts and other liabilities, contingent
obligations and commitments as they mature and become due in the normal course
of business; (iii) assuming consummation of the issuance of the Securities as
contemplated by this Agreement, the Time of Sale Information and the Offering
Memorandum, the Parent and its subsidiaries are not incurring debts or
liabilities beyond their ability to pay as such debts and liabilities mature;
and (iv) the Parent and its subsidiaries are not a defendant in any civil action
that would result in a judgment that the Parent and its subsidiaries are or
would become unable to satisfy.

 

(kk)         No Restrictions on Subsidiaries.  Except as disclosed in the Time
of Sale Information and the Offering Memorandum, no subsidiary of the Parent is
currently prohibited, directly or indirectly, under any agreement or other
instrument to which it is a party or is subject, from paying any dividends to
the Parent, from making any other distribution on such subsidiary’s capital
stock, from repaying to the Parent any loans or advances to such subsidiary from
the Parent or from transferring any of such subsidiary’s properties or assets to
the Parent or any other subsidiary of the Parent.

 

(ll)           No Broker’s Fees.  Neither the Parent nor any of its subsidiaries
is a party to any contract, agreement or understanding with any person (other
than this Agreement) that would give rise to a valid claim against any of them
or any Initial Purchaser for a brokerage commission, finder’s fee or like
payment in connection with the offering and sale of the Securities.

 

(mm)       Rule 144A Eligibility.  On the Closing Date, the Securities will not
be of the same class as securities listed on a national securities exchange
registered under Section 6 of the Exchange Act or quoted in an automated
inter-dealer quotation system; and each of the Preliminary Offering Memorandum
and the Offering Memorandum, as of its respective date, contains or will contain
all the information that, if requested by a prospective purchaser of the
Securities, would be required to be provided to such prospective purchaser
pursuant to Rule 144A(d)(4) under the Securities Act.

 

12

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(nn)         No Integration.  Neither the Company nor any of its affiliates (as
defined in Rule 501(b) of Regulation D) has, directly or through any agent,
sold, offered for sale, solicited offers to buy or otherwise negotiated in
respect of, any security (as defined in the Securities Act), that is or will be
integrated with the sale of the Securities in a manner that would require
registration of the Securities under the Securities Act.

 

(oo)         No General Solicitation or Directed Selling Efforts.  None of the
Company or any of its affiliates or any other person acting on its or their
behalf (other than the Initial Purchasers, as to which no representation is
made) has (i) solicited offers for, or offered or sold, the Securities by means
of any form of general solicitation or general advertising within the meaning of
Rule 502(c) of Regulation D or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act or (ii) engaged in any
directed selling efforts within the meaning of Regulation S under the Securities
Act (“Regulation S”), and all such persons have complied with the offering
restrictions requirement of Regulation S.

 

(pp)         Securities Law Exemptions.  Assuming the accuracy of the
representations and warranties of the Initial Purchasers contained in
Section 1(b) (including Annex C hereto) and their compliance with their
agreements set forth therein, it is not necessary, in connection with the
issuance and sale of the Securities to the Initial Purchasers and the offer,
resale and delivery of the Securities by the Initial Purchasers in the manner
contemplated by this Agreement, the Time of Sale Information and the Offering
Memorandum, to register the Securities under the Securities Act or to qualify
the Indenture under the Trust Indenture Act.

 

(qq)         No Stabilization.  Neither the Company nor any of the Guarantors
has taken, directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in any stabilization or manipulation
of the price of the Securities.

 

(rr)           Forward-Looking Statements.  No forward-looking statement (within
the meaning of Section 27A of the Securities Act and Section 21E of the Exchange
Act) included or incorporated by reference in any of the Time of Sale
Information or the Offering Memorandum has been made or reaffirmed without a
reasonable basis or has been disclosed other than in good faith.

 

(ss)         Statistical and Market Data.  Nothing has come to the attention of
the Company that has caused the Company to believe that the statistical and
market-related data included or incorporated by reference in each of the Time of
Sale Information and the Offering Memorandum is not based on or derived from
sources that are reliable and accurate in all material respects.

 

(tt)           Sarbanes-Oxley Act.  There is and has been no failure on the part
of the Company or any of the Company’s directors or officers, in their
capacities as such, to comply with any provision of the Sarbanes-Oxley Act of
2002 and the rules and regulations promulgated in connection therewith (the
“Sarbanes-Oxley Act”) applicable to the Company, including Section 402 related
to loans and Sections 302 and 906 related to certifications.

 

4.             Further Agreements of the Antero Entities.  Each of the Antero
Entities jointly and severally covenants and agrees with each Initial Purchaser
that:

 

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(a)           Delivery of Copies.  The Company will deliver, without charge, to
the Initial Purchasers as many copies of the Preliminary Offering Memorandum,
any other Time of Sale Information, any Issuer Written Communication and the
Offering Memorandum (including all amendments and supplements thereto) as the
Representative may reasonably request.

 

(b)           Offering Memorandum, Amendments or Supplements.  Before finalizing
the Offering Memorandum or making or distributing any amendment or supplement to
any of the Time of Sale Information or the Offering Memorandum or filing with
the Commission any document that will be incorporated by reference therein, the
Company will furnish to the Representative and counsel for the Initial
Purchasers a copy of the proposed Offering Memorandum or such amendment or
supplement or document to be incorporated by reference therein for review, and
will not distribute any such proposed Offering Memorandum, amendment or
supplement or file any such document with the Commission to which the
Representative reasonably objects.

 

(c)           Additional Written Communications.  Before making, preparing,
using, authorizing, approving or referring to any Issuer Written Communication,
the Antero Entities will furnish to the Representative and counsel for the
Initial Purchasers a copy of such written communication for review and will not
make, prepare, use, authorize, approve or refer to any such written
communication to which the Representative reasonably objects.

 

(d)           Notice to the Representative.  The Company will advise the
Representative promptly, and confirm such advice in writing, (i) of the issuance
by any governmental or regulatory authority of any order preventing or
suspending the use of any of the Time of Sale Information, any Issuer Written
Communication or the Offering Memorandum or the initiation or threatening of any
proceeding for that purpose; (ii) of the occurrence of any event at any time
prior to the completion of the initial offering of the Securities as a result of
which any of the Time of Sale Information, any Issuer Written Communication or
the Offering Memorandum as then amended or supplemented would include any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances existing when
such Time of Sale Information, Issuer Written Communication or the Offering
Memorandum is delivered to a purchaser, not misleading; and (iii) of the receipt
by the Company of any notice with respect to any suspension of the qualification
of the Securities for offer and sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and the Company will use its
reasonable best efforts to prevent the issuance of any such order preventing or
suspending the use of any of the Time of Sale Information, any Issuer Written
Communication or the Offering Memorandum or suspending any such qualification of
the Securities and, if any such order is issued, will obtain as soon as possible
the withdrawal thereof.

 

(e)           Time of Sale Information.  If at any time prior to the Closing
Date (i) any event shall occur or condition shall exist as a result of which any
of the Time of Sale Information as then amended or supplemented would include
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements

 

14

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therein, in the light of the circumstances under which they were made, not
misleading or (ii) it is necessary to amend or supplement any of the Time of
Sale Information to comply with law, the Company will immediately notify the
Initial Purchasers thereof and forthwith prepare and, subject to paragraph
(b) above, furnish to the Initial Purchasers such amendments or supplements to
any of the Time of Sale Information (or any document to be filed with the
Commission and incorporated by reference therein) as may be necessary so that
the statements in any of the Time of Sale Information as so amended or
supplemented (including such documents to be incorporated by reference therein)
will not, in light of the circumstances under which they were made, be
misleading or so that any of the Time of Sale Information will comply with law.

 

(f)            Ongoing Compliance of the Offering Memorandum.  If at any time
prior to the completion of the initial offering of the Securities (i) any event
shall occur or condition shall exist as a result of which the Offering
Memorandum as then amended or supplemented would include any untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances existing when the
Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is
necessary to amend or supplement the Offering Memorandum to comply with law, the
Company will as soon as practicable notify the Initial Purchasers thereof and
forthwith prepare and, subject to paragraph (b) above, furnish to the Initial
Purchasers such amendments or supplements to the Offering Memorandum (or any
document to be filed with the Commission and incorporated by reference therein)
as may be necessary so that the statements in the Offering Memorandum as so
amended or supplemented (including such document to be incorporated by reference
therein) will not, in the light of the circumstances existing when the Offering
Memorandum is delivered to a purchaser, be misleading or so that the Offering
Memorandum will comply with law.

 

(g)           Blue Sky Compliance.  The Company will qualify the Securities for
offer and sale under the securities or Blue Sky laws of such jurisdictions as
the Representative shall reasonably request and will continue such
qualifications in effect so long as required for the offering and resale of the
Securities; provided that neither the Company nor any of the Guarantors shall be
required to (i) qualify as a foreign corporation or other entity or as a dealer
in securities in any such jurisdiction where it would not otherwise be required
to so qualify, (ii) file any general consent to service of process in any such
jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it
is not otherwise so subject.

 

(h)           Clear Market.  During the period from the date hereof through and
including the date that is 60 days after the date hereof, each of the Antero
Entities will not, without the prior written consent of the Representative,
offer, sell, contract to sell or otherwise dispose of any debt securities issued
or guaranteed by the Company or any of the Guarantors and having a tenor of more
than one year.

 

(i)            Use of Proceeds.  The Company will apply the net proceeds from
the sale of the Securities as described in each of the Time of Sale Information
and the Offering Memorandum under the heading “Use of proceeds.”

 

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(j)            Supplying Information.  While the Securities remain outstanding
and are “restricted securities” within the meaning of Rule 144(a)(3) under the
Securities Act, each of the Antero Entities will, during any period in which the
Company is not subject to and in compliance with Section 13 or 15(d) of the
Exchange Act, furnish to holders of the Securities and prospective purchasers of
the Securities designated by such holders, upon the request of such holders or
such prospective purchasers, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act.

 

(k)           DTC.  The Company will assist the Initial Purchasers in arranging
for the Securities to be eligible for clearance and settlement through DTC.

 

(l)            No Resales by the Company.  The Company will not, and will not
permit any of its affiliates (as defined in Rule 144 under the Securities Act)
to, resell any of the Securities that have been acquired by any of them, except
for Securities purchased by the Company or any of its affiliates and resold in a
transaction registered under the Securities Act.

 

(m)          No Integration.  Neither the Company nor any of its affiliates (as
defined in Rule 501(b) of Regulation D) will, directly or through any agent,
sell, offer for sale, solicit offers to buy or otherwise negotiate in respect
of, any security (as defined in the Securities Act), that is or will be
integrated with the sale of the Securities in a manner that would require
registration of the Securities under the Securities Act.

 

(n)           No General Solicitation or Directed Selling Efforts.  None of the
Company or any of its affiliates or any other person acting on its or their
behalf (other than the Initial Purchasers, as to which no covenant is given)
will (i) solicit offers for, or offer or sell, the Securities by means of any
form of general solicitation or general advertising within the meaning of
Rule 502(c) of Regulation D or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act or (ii) engage in any directed
selling efforts within the meaning of Regulation S, and all such persons will
comply with the offering restrictions requirement of Regulation S.

 

(o)           No Stabilization.  Neither the Company nor any of the Guarantors
will take, directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in any stabilization or manipulation
of the price of the Securities.

 

5.             Certain Agreements of the Initial Purchasers.  Each Initial
Purchaser hereby represents and agrees that it has not and will not use,
authorize use of, refer to, or participate in the planning for use of, any
written communication that constitutes an offer to sell or the solicitation of
an offer to buy the Securities other than (i) the Preliminary Offering
Memorandum and the Offering Memorandum, (ii) a written communication that
contains no “issuer information” (as defined in Rule 433(h)(2) under the
Securities Act) that was not included (including through incorporation by
reference) in the Preliminary Offering Memorandum or the Offering Memorandum,
(iii) any written communication listed on Annex A or prepared pursuant to
Section 4(c) above (including any electronic road show), (iv) any written
communication prepared by such Initial Purchaser and approved by the Company in
advance in writing or (v) any written communication relating to or that contains
the terms of the Securities and/or other

 

16

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information that was included (including through incorporation by reference) in
Time of Sale Information or the Offering Memorandum.

 

6.             Conditions of Initial Purchasers’ Obligations.  The obligation of
each Initial Purchaser to purchase Securities on the Closing Date as provided
herein is subject to the performance by each of the Antero Entities of their
respective covenants and other obligations hereunder and to the following
additional conditions:

 

(a)           Representations and Warranties.  The representations and
warranties of the Antero Entities contained herein shall be true and correct on
the date hereof and on and as of the Closing Date; and the statements of the
Company, the Guarantors and their respective officers made in any certificates
delivered pursuant to this Agreement shall be true and correct on and as of the
Closing Date.

 

(b)           No Downgrade.  Subsequent to the earlier of (A) the Time of Sale
and (B) the execution and delivery of this Agreement, (i) no downgrading shall
have occurred in the rating accorded the Securities or any other debt securities
or preferred stock issued or guaranteed by the Parent or any of its subsidiaries
by any “nationally recognized statistical rating organization”, as such term is
defined under Section 3(a)(62) under the Exchange Act; and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, or has changed its outlook with respect to, its rating of the Securities
or of any other debt securities or preferred stock issued or guaranteed by the
Parent or any of its subsidiaries (other than an announcement with positive
implications of a possible upgrading).

 

(c)           No Material Adverse Change.  No event or condition of a type
described in Section 3(e) hereof shall have occurred or shall exist, which event
or condition is not described in each of the Time of Sale Information (excluding
any amendment or supplement thereto) and the Offering Memorandum (excluding any
amendment or supplement thereto) the effect of which in the judgment of the
Representative makes it impracticable or inadvisable to proceed with the
offering, sale or delivery of the Securities on the terms and in the manner
contemplated by this Agreement, the Time of Sale Information and the Offering
Memorandum.

 

(d)           Officer’s Certificate.  The Representative shall have received on
and as of the Closing Date a certificate of an executive officer of the Company
and of each Guarantor who has specific knowledge of the Company’s or such
Guarantor’s financial matters and is satisfactory to the Representative
(i) confirming that such officer has carefully reviewed the Time of Sale
Information and the Offering Memorandum and, to the best knowledge of such
officer, the representations set forth in Sections 3(a) and 3(b) hereof are true
and correct, (ii) confirming that the other representations and warranties of
the Antero Entities in this Agreement are true and correct and that the Antero
Entities have complied with all agreements and satisfied all conditions on their
part to be performed or satisfied hereunder at or prior to the Closing Date and
(iii) to the effect set forth in paragraphs (b) and (c) above.

 

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(e)           Comfort Letters.  On the date of this Agreement and on the Closing
Date, KPMG LLP shall have furnished to the Representative, at the request of the
Company, letters, dated the respective dates of delivery thereof and addressed
to the Initial Purchasers, in form and substance reasonably satisfactory to the
Representative, containing statements and information of the type customarily
included in accountants’ “comfort letters” to underwriters with respect to the
financial statements and certain financial information contained or incorporated
by reference in each of the Time of Sale Information and the Offering
Memorandum; provided that the letter delivered on the Closing Date shall use a
“cut-off” date no more than three business days prior to the Closing Date.

 

(f)            Opinion and 10b-5 Statement of Counsel for the Company.  Vinson &
Elkins L.L.P., counsel for the Antero Entities, shall have furnished to the
Representative, at the request of the Company, their written opinion and 10b-5
statement, dated the Closing Date and addressed to the Initial Purchasers, in
form and substance reasonably satisfactory to the Representative, to the effect
set forth in Annex D hereto.

 

(g)           Opinion and 10b-5 Statement of Counsel for the Initial
Purchasers.  The Representative shall have received on and as of the Closing
Date an opinion and 10b-5 statement of Simpson Thacher & Bartlett LLP, counsel
for the Initial Purchasers, with respect to such matters as the Representative
may reasonably request, and such counsel shall have received such documents and
information as they may reasonably request to enable them to pass upon such
matters.

 

(h)           Reserve Letters.  On the date of this Agreement and on the Closing
Date, as the case may be, each of DeGolyer and MacNaughton, Ryder Scott Company,
L.P. and Wright & Co. shall have furnished to the Representative, at the request
of the Parent, reserve report confirmation letters, dated the respective dates
of delivery thereof and addressed to the Initial Purchasers, in form and
substance reasonably satisfactory to the Representative, containing statements
and information of the type customarily included in such letters to underwriters
with respect to the reserve and other operational information contained in the
Preliminary Offering Memorandum, the Time of Sale Information and the Offering
Memorandum.

 

(i)            No Legal Impediment to Issuance.  No action shall have been taken
and no statute, rule, regulation or order shall have been enacted, adopted or
issued by any federal, state or foreign governmental or regulatory authority
that would, as of the Closing Date, prevent the issuance or sale of the
Securities or the issuance of the Guarantees; and no injunction or order of any
federal, state or foreign court shall have been issued that would, as of the
Closing Date, prevent the issuance or sale of the Securities or the issuance of
the Guarantees.

 

(j)            Registration Rights Agreement.  The Initial Purchasers shall have
received a counterpart of the Registration Rights Agreement that shall have been
executed and delivered by a duly authorized officer of each of the Antero
Entities.

 

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(k)           DTC.  The Securities shall be eligible for clearance and
settlement through DTC.

 

(l)            Additional Documents.  On or prior to the Closing Date, the
Antero Entities shall have furnished to the Representative such further
certificates and documents as the Representative may reasonably request.

 

All opinions, letters, certificates and evidence mentioned above or elsewhere in
this Agreement shall be deemed to be in compliance with the provisions hereof
only if they are in form and substance reasonably satisfactory to counsel for
the Initial Purchasers.

 

7.             Indemnification and Contribution.

 

(a)           Indemnification of the Initial Purchasers.  Each of the Antero
Entities jointly and severally agree to indemnify and hold harmless each Initial
Purchaser, its affiliates, directors and officers and each person, if any, who
controls such Initial Purchaser within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities (including, without limitation, legal
fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred), joint
or several, that arise out of, or are based upon, any untrue statement or
alleged untrue statement of a material fact contained in the Preliminary
Offering Memorandum, any of the other Time of Sale Information, any Issuer
Written Communication or the Offering Memorandum (or any amendment or supplement
thereto) or any omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, in each case except
insofar as such losses, claims, damages or liabilities arise out of, or are
based upon, any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with any information relating
to any Initial Purchaser furnished to the Company in writing by such Initial
Purchaser through the Representative expressly for use therein.

 

(b)           Indemnification of the Antero Entities.  Each Initial Purchaser
agrees, severally and not jointly, to indemnify and hold harmless each of the
Antero Entities, each of their respective directors and officers and each
person, if any, who controls any of the Antero Entities within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the indemnity set forth in paragraph (a) above, but only with respect
to any losses, claims, damages or liabilities that arise out of, or are based
upon, any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with any information relating to such
Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through the Representative expressly for use in the Preliminary Offering
Memorandum, any of the other Time of Sale Information, any Issuer Written
Communication or the Offering Memorandum (or any amendment or supplement
thereto), it being understood and agreed that the only such information consists
of the following:  the second and third sentences of the third paragraph and the
penultimate paragraph under the caption “Plan of distribution” in the
Preliminary Offering Memorandum, the Time of Sale Information and the Offering
Memorandum.

 

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(c)           Notice and Procedures.  If any suit, action, proceeding (including
any governmental or regulatory investigation), claim or demand shall be brought
or asserted against any person in respect of which indemnification may be sought
pursuant to either paragraph (a) or (b) above, such person (the “Indemnified
Person”) shall promptly notify the person against whom such indemnification may
be sought (the “Indemnifying Person”) in writing; provided that the failure to
notify the Indemnifying Person shall not relieve it from any liability that it
may have under paragraph (a) or (b) above except to the extent that it has been
materially prejudiced (through the forfeiture of substantive rights or defenses)
by such failure; and provided, further, that the failure to notify the
Indemnifying Person shall not relieve it from any liability that it may have to
an Indemnified Person otherwise than under paragraph (a) or (b) above.  If any
such proceeding shall be brought or asserted against an Indemnified Person and
it shall have notified the Indemnifying Person thereof, the Indemnifying Person
shall retain counsel reasonably satisfactory to the Indemnified Person (who
shall not, without the consent of the Indemnified Person, be counsel to the
Indemnifying Person) to represent the Indemnified Person and any others entitled
to indemnification pursuant to this Section 7 that the Indemnifying Person may
designate in such proceeding and shall pay the fees and expenses of such
proceeding and shall pay the fees and expenses of such counsel related to such
proceeding, as incurred.  In any such proceeding, any Indemnified Person shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary; (ii) the Indemnifying Person has failed within a reasonable time to
retain counsel reasonably satisfactory to the Indemnified Person; (iii) the
Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it that are different from or in addition to those
available to the Indemnifying Person; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them.  It is understood and agreed that the Indemnifying Person shall
not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and expenses shall be reimbursed as they are incurred.  Any such
separate firm for any Initial Purchaser, its affiliates, directors and officers
and any control persons of such Initial Purchaser shall be designated in writing
by J.P. Morgan Securities LLC and any such separate firm for the Antero
Entities, their respective directors and officers and any control persons of the
Antero Entities shall be designated in writing by the Company.  The Indemnifying
Person shall not be liable for any settlement of any proceeding effected without
its written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Person agrees to indemnify each
Indemnified Person from and against any loss or liability by reason of such
settlement or judgment.  No Indemnifying Person shall, without the written
consent of the Indemnified Person, effect any settlement of any pending or
threatened proceeding in respect of which any Indemnified Person is or could
have been a party and indemnification could have been sought hereunder by such
Indemnified Person, unless such settlement (x) includes an unconditional release
of such Indemnified Person, in form and substance reasonably satisfactory to
such Indemnified Person, from all liability on claims that are the subject
matter of such proceeding and (y) does not include any statement as to or any
admission of fault, culpability or a failure to act by or on behalf of any
Indemnified Person.

 

20

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(d)           Contribution.  If the indemnification provided for in paragraph
(a) or (b) above is unavailable to an Indemnified Person or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Antero Entities on the one hand and the Initial
Purchasers on the other from the offering of the Securities or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) but also the relative fault of the Antero Entities on the one
hand and the Initial Purchasers on the other in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations.  The relative benefits
received by the Antero Entities on the one hand and the Initial Purchasers on
the other shall be deemed to be in the same respective proportions as the net
proceeds (before deducting expenses) received by the Company from the sale of
the Securities and the total discounts and commissions received by the Initial
Purchasers in connection therewith, as provided in this Agreement, bear to the
aggregate offering price of the Securities.  The relative fault of the Antero
Entities on the one hand and the Initial Purchasers on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or any Guarantor
or by the Initial Purchasers and the parties’ relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.

 

(e)           Limitation on Liability.  The Company, the Guarantors and the
Initial Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 7 were determined by pro rata allocation (even if the
Initial Purchasers were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable considerations
referred to in paragraph (d) above.  The amount paid or payable by an
Indemnified Person as a result of the losses, claims, damages and liabilities
referred to in paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with any such action or claim.  Notwithstanding
the provisions of this Section 7, in no event shall an Initial Purchaser be
required to contribute any amount in excess of the amount by which the total
discounts and commissions received by such Initial Purchaser with respect to the
offering of the Securities exceeds the amount of any damages that such Initial
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.  The Initial Purchasers’
obligations to contribute pursuant to this Section 7 are several in proportion
to their respective purchase obligations hereunder and not joint.

 

(f)            Non-Exclusive Remedies.  The remedies provided for in this
Section 7 are not exclusive and shall not limit any rights or remedies that may
otherwise be available to any Indemnified Person at law or in equity.

 

21

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8.             Termination.  This Agreement may be terminated in the absolute
discretion of the Representative, by notice to the Company, if after the
execution and delivery of this Agreement and on or prior to the Closing Date
(i) trading generally shall have been suspended or materially limited on the New
York Stock Exchange or the over-the-counter market; (ii) trading of any
securities issued or guaranteed by the Company or any of the Guarantors shall
have been suspended on any exchange or in any over-the-counter market; (iii) a
general moratorium on commercial banking activities shall have been declared by
federal or New York State authorities; or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis, either within or outside the United States, that, in the
judgment of the Representative, is material and adverse and makes it
impracticable or inadvisable to proceed with the offering, sale or delivery, of
the Securities on the terms and in the manner contemplated by this Agreement,
the Time of Sale Information and the Offering Memorandum.

 

9.             Defaulting Initial Purchaser.  c. If, on the Closing Date, any
Initial Purchaser defaults on its obligation to purchase the Securities that it
has agreed to purchase hereunder, the non-defaulting Initial Purchasers may in
their discretion arrange for the purchase of such Securities by other persons
satisfactory to the Company on the terms contained in this Agreement.  If,
within 36 hours after any such default by any Initial Purchaser, the
non-defaulting Initial Purchasers do not arrange for the purchase of such
Securities, then the Company shall be entitled to a further period of 36 hours
within which to procure other persons satisfactory to the non-defaulting Initial
Purchasers to purchase such Securities on such terms.  If other persons become
obligated or agree to purchase the Securities of a defaulting Initial Purchaser,
either the non-defaulting Initial Purchasers or the Company may postpone the
Closing Date for up to five full business days in order to effect any changes
that in the opinion of counsel for the Company or counsel for the Initial
Purchasers may be necessary in the Time of Sale Information, the Offering
Memorandum or in any other document or arrangement, and the Company agrees to
promptly prepare any amendment or supplement to the Time of Sale Information or
the Offering Memorandum that effects any such changes.  As used in this
Agreement, the term “Initial Purchaser” includes, for all purposes of this
Agreement unless the context otherwise requires, any person not listed in
Schedule 1 hereto that, pursuant to this Section 9, purchases Securities that a
defaulting Initial Purchaser agreed but failed to purchase.

 

(a)           If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Initial Purchaser or Initial Purchasers by the
non-defaulting Initial Purchasers and the Company as provided in paragraph
(a) above, the aggregate principal amount of such Securities that remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
all the Securities, then the Company shall have the right to require each
non-defaulting Initial Purchaser to purchase the principal amount of Securities
that such Initial Purchaser agreed to purchase hereunder plus such Initial
Purchaser’s pro rata share (based on the principal amount of Securities that
such Initial Purchaser agreed to purchase hereunder) of the Securities of such
defaulting Initial Purchaser or Initial Purchasers for which such arrangements
have not been made.

 

(b)           If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Initial Purchaser or Initial Purchasers by the
non-defaulting Initial Purchasers and the Company as provided in paragraph
(a) above, the aggregate principal amount

 

22

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of such Securities that remains unpurchased exceeds one-eleventh of the
aggregate principal amount of all the Securities, or if the Company shall not
exercise the right described in paragraph (b) above, then this Agreement shall
terminate without liability on the part of the non-defaulting Initial
Purchasers.  Any termination of this Agreement pursuant to this Section 9 shall
be without liability on the part of the Company or the Guarantors, except that
each of the Antero Entities will continue to be liable for the payment of
expenses as set forth in Section 10 hereof and except that the provisions of
Section 7 hereof shall not terminate and shall remain in effect.

 

(c)           Nothing contained herein shall relieve a defaulting Initial
Purchaser of any liability it may have to the Antero Entities or any
non-defaulting Initial Purchaser for damages caused by its default.

 

10.           Payment of Expenses.  d. Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement is terminated,
each of the Antero Entities jointly and severally agree to pay or cause to be
paid all costs and expenses incident to the performance of their respective
obligations hereunder, including without limitation, (i) the costs incident to
the authorization, issuance, sale, preparation and delivery of the Securities
and any taxes payable in that connection; (ii) the costs incident to the
preparation and printing of the Preliminary Offering Memorandum, any other Time
of Sale Information, any Issuer Written Communication and the Offering
Memorandum (including any amendment or supplement thereto) and the distribution
thereof; (iii) the costs of reproducing and distributing each of the Transaction
Documents; (iv) the fees and expenses of the Company’s and the Guarantors’
counsel, independent accountants and independent reserve engineers; (v) the fees
and expenses incurred in connection with the registration or qualification and
determination of eligibility for investment of the Securities under the laws of
such jurisdictions as the Representative may designate and the preparation,
printing and distribution of a Blue Sky Memorandum (including the related fees
and expenses of counsel for the Initial Purchasers); (vi) any fees charged by
rating agencies for rating the Securities; (vii) the fees and expenses of the
Trustee and any paying agent (including related fees and expenses of any counsel
to such parties); (viii) all expenses and application fees incurred in
connection with the approval of the Securities for book-entry transfer by DTC;
and (ix) all expenses incurred by the Company in connection with any “road show”
presentation to potential investors.

 

(a)           If (i) this Agreement is terminated pursuant to Section 8(ii),
(ii) the Company for any reason fails to tender the Securities for delivery to
the Initial Purchasers or (iii) the Initial Purchasers decline to purchase the
Securities for any other reason permitted under this Agreement, each of the
Antero Entities jointly and severally agree to reimburse the Initial Purchasers
for all out-of-pocket costs and expenses (including the fees and expenses of
their counsel) reasonably incurred by the Initial Purchasers in connection with
this Agreement and the offering contemplated hereby.

 

11.           Persons Entitled to Benefit of Agreement.  This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective successors and any controlling persons referred to herein, and the
affiliates, officers and directors of each Initial Purchaser referred to in
Section 7 hereof.  Nothing in this Agreement is intended or shall be construed
to give any other person any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provision contained herein.  No purchaser of
Securities from any Initial Purchaser shall be deemed to be a successor merely
by reason of such purchase.

 

23

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12.           Survival.  The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company, the Guarantors and
the Initial Purchasers contained in this Agreement or made by or on behalf of
the Company, the Guarantors or the Initial Purchasers pursuant to this Agreement
or any certificate delivered pursuant hereto shall survive the delivery of and
payment for the Securities and shall remain in full force and effect, regardless
of any termination of this Agreement or any investigation made by or on behalf
of the Company, the Guarantors or the Initial Purchasers.

 

13.           Certain Defined Terms.  For purposes of this Agreement, (a) except
where otherwise expressly provided, the term “affiliate” has the meaning set
forth in Rule 405 under the Securities Act; (b) the term “business day” means
any day other than a day on which banks are permitted or required to be closed
in New York City; (c) the term “subsidiary” has the meaning set forth in
Rule 405 under the Securities Act; and (d) the term “written communication” has
the meaning set forth in Rule 405 under the Securities Act.

 

14.           Compliance with USA Patriot Act.  In accordance with the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)), the Initial Purchasers are required to obtain, verify
and record information that identifies their respective clients, including the
Company, which information may include the name and address of their respective
clients, as well as other information that will allow the Initial Purchasers to
properly identify their respective clients.

 

15.           Miscellaneous.  e. Authority of the Representative.  Any action by
the Initial Purchasers hereunder may be taken by J.P. Morgan Securities LLC on
behalf of the Initial Purchasers, and any such action taken by J.P. Morgan
Securities LLC shall be binding upon the Initial Purchasers.

 

(a)           Notices.  All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given if mailed or transmitted
and confirmed by any standard form of telecommunication.  Notices to the Initial
Purchasers shall be given to the Representative c/o J.P. Morgan Securities LLC,
383 Madison Avenue, New York, New York 10179 (fax: (212)-270-1063); Attention:
Bob Mertensotto, with a copy (which shall not constitute notice) to: Gary L.
Sellers, Esq., Simpson Thacher & Bartlett LLP, 425 Lexington Avenue, New York,
New York 10017 (fax: (212) 455-2502).  Notices to the Antero Entities shall be
given to them at 1625 17th Street, Denver, Colorado 80202, (fax: (303)
357-7299); Attention: Glen C. Warren, Jr., with a copy (which shall not
constitute notice) to: William Matthew Strock, Esq., Vinson & Elkins, L.L.P.,
First City Tower, 1001 Fannin Street, Suite 2500, Houston, TX 77002-6760, (fax:
(713) 615-5650).

 

(b)           Governing Law.  This Agreement and any claim, controversy or
dispute arising under or related to this Agreement shall be governed by and
construed in accordance with the laws of the State of New York.

 

(c)           Counterparts.  This Agreement may be signed in counterparts (which
may include counterparts delivered by any standard form of telecommunication),
each of which shall be an original and all of which together shall constitute
one and the same instrument.

 

24

--------------------------------------------------------------------------------

 

(d)           Amendments or Waivers.  No amendment or waiver of any provision of
this Agreement, nor any consent or approval to any departure therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
parties hereto.

 

(e)           Headings.  The headings herein are included for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.

 

25

--------------------------------------------------------------------------------

 

If the foregoing is in accordance with your understanding, please indicate your
acceptance of this Agreement by signing in the space provided below.

 

 

Very truly yours,

 

 

 

ANTERO RESOURCES FINANCE CORPORATION

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

Administration and Accounting

 

 

 

Guarantors:

 

 

 

ANTERO RESOURCES LLC

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

Administration and Accounting

 

 

 

 

 

ANTERO RESOURCES CORPORATION

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

Administration and Accounting

 

 

 

 

 

ANTERO RESOURCES PICEANCE CORPORATION

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

Administration and Accounting

 

26

--------------------------------------------------------------------------------

 

 

ANTERO RESOURCES PIPELINE CORPORATION

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

 

Administration and Accounting

 

 

 

 

 

ANTERO RESOURCES APPALACHIAN CORPORATION

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

Administration and Accounting

 

 

 

 

 

ANTERO RESOURCES BLUESTONE LLC

 

 

 

 

 

 

By

/s/ Alvyn A. Schopp

 

 

Name:

Alvyn A. Schopp

 

 

Title:

Treasurer and Vice President,

 

 

Administration and Accounting

 

 

Accepted: July 27, 2011

 

J.P. MORGAN SECURITIES LLC

 

For itself and on behalf of the
several Initial Purchasers listed
in Schedule 1 hereto.

 

 

By

/s/ Brian A. Tramontozzi

 

 

     Authorized Signatory

 

 

27

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Schedule 1

 

Initial Purchaser

 

Principal Amount

 

 

 

 

 

J.P. Morgan Securities LLC

 

$

160,000,000

 

Wells Fargo Securities, LLC

 

$

80,000,000

 

Barclays Capital Inc.

 

$

60,000,000

 

BNP Paribas Securities Corp.

 

$

16,000,000

 

Credit Agricole Securities (USA) Inc.

 

$

16,000,000

 

Credit Suisse Securities (USA) LLC

 

$

16,000,000

 

Deutsche Bank Securities Inc.

 

$

16,000,000

 

Comerica Securities, Inc.

 

$

8,000,000

 

Lloyds Securities Inc.

 

$

8,000,000

 

Mitsubishi UFJ Securities (USA), Inc.

 

$

8,000,000

 

KeyBanc Capital Markets Inc.

 

$

6,000,000

 

U.S. Bancorp Investments, Inc.

 

$

6,000,000

 

 

 

 

 

Total

 

$

400,000,000

 

 

S-1-1

--------------------------------------------------------------------------------

 

Schedule 2

 

Guarantors

 

Antero Resources Corporation

Antero Resources Piceance Corporation

Antero Resources Pipeline Corporation

Antero Resources Appalachian Corporation

Antero Resources Bluestone LLC

 

S-2-1

--------------------------------------------------------------------------------

 

Schedule 3

 

Subsidiaries of the Parent

 

Entity Name

 

Jurisdiction of Incorporation or Formation

Antero Resources Corporation

 

Delaware

Antero Resources Piceance Corporation

 

Delaware

Antero Resources Appalachian Corporation

 

Delaware

Antero Resources Pipeline Corporation

 

Delaware

Antero Resources Finance Corporation

 

Delaware

Antero Resources Bluestone LLC

 

Delaware

 

S-3-1

--------------------------------------------------------------------------------

 

ANNEX A

 

a.             Additional Time of Sale Information

 

1.             Term sheet containing the terms of the securities, substantially
in the form of Annex B.

 

A-1

--------------------------------------------------------------------------------

 

ANNEX B

 

Antero Resources Finance Corporation

 

7.250% Senior Notes due 2019

 

Pricing Term Sheet

 

July 27, 2011

 

The notes have not been registered under the Securities Act.  The notes may not
be offered or sold in the United States or to U.S. persons, except to qualified
institutional buyers in reliance on Rule 144A and to certain persons in offshore
transactions in reliance on Regulation S.  You are hereby notified that sellers
of the notes may be relying on the exemption from the provisions of Section 5 of
the Securities Act provided by Rule 144A.  Any sales of the notes outside the
United States may only be made in accordance with applicable selling
restrictions.

 

The information in this term sheet supplements Antero Resources Finance
Corporation’s preliminary offering memorandum dated July 27, 2011 (the
“Preliminary Offering Memorandum”), and supersedes the information in the
Preliminary Offering Memorandum to the extent inconsistent with the information
in the Preliminary Offering Memorandum.  This term sheet is qualified in its
entirety by reference to the Preliminary Offering Memorandum.

 

Issuer:

 

Antero Resources Finance Corporation

Size:

 

$400,000,000

Maturity:

 

August 1, 2019

Coupon:

 

7.250%

Price:

 

100.00% of face amount

Yield to maturity:

 

7.250%

Spread to Benchmark Treasury:

 

+472 basis points

Benchmark Treasury:

 

UST 3.625% due August 15, 2019

Interest Payment Dates:

 

August 1 and February 1, commencing February 1, 2012

Record Dates:

 

July 15 and January 15

Gross Proceeds:

 

$400,000,000

Redemption Provisions:

 

 

First call date:

 

August 1, 2014

Make-whole call:

 

Before the first call date at redemption price equal to 100.0% of the principal
amount thereof, plus the “Applicable Premium” as described in the Preliminary
Offering Memorandum, plus accrued and unpaid interest, if any, to the date of
redemption.

Redemption prices:

 

Commencing August 1, 2014: 105.438%

 

 

Commencing August 1, 2015: 103.625%

 

 

Commencing August 1, 2016: 101.813%

 

 

Commencing August 1, 2017: 100.000%

Redemption with proceeds of equity offering:

 

On or prior to August 1, 2014, up to 35% may be redeemed at 107.250%

Change of control:

 

On or prior to January 1, 2013, call at 110% of principal plus accrued interest

Put at 101% of principal plus accrued interest

Trade date:

 

July 27, 2011

Settlement:

 

T+3; August 1, 2011

Denominations:

 

$2,000 and integral multiples of $1,000

CUSIP/ISIN:

 

144A Notes: 03674P AD5 / US03674PAD50

Reg S Notes: U00188 AB5 / USU00188AB53

Form of Offering:

 

144A and Regulation S with registration rights as set forth in the Preliminary
Offering Memorandum

Ratings:

 

[Intentionally Omitted]

Joint book-running managers:

 

J.P. Morgan Securities LLC

 

B-1

--------------------------------------------------------------------------------

 

 

 

Wells Fargo Securities, LLC

Barclays Capital Inc.

Co-managers:

 

BNP Paribas Securities Corp.

Credit Agricole Securities (USA) Inc.

Credit Suisse Securities (USA) LLC

Deutsche Bank Securities Inc.

Comerica Securities, Inc.

Lloyds Securities Inc.

Mitsubishi UFJ Securities (USA), Inc.

KeyBanc Capital Markets Inc.

U.S. Bancorp Investments, Inc.

 

Additional Information:

 

The information under the caption “Capitalization” in the Preliminary Offering
Memorandum and each other location where it appears in the Preliminary Offering
Memorandum is hereby replaced in its entirety with the following information:

 

Capitalization

 

The following table sets forth our cash and cash equivalents and capitalization
as of March 31, 2011:

 

·                  on an actual basis; and

 

·                  as adjusted for the issuance of the notes offered hereby and
the application of estimated net proceeds therefrom as described in “Use of
proceeds” section in the Preliminary Offering Memorandum.

 

This table should be read in conjunction with, and is qualified in its entirety
by reference to, “Use of proceeds” section in the Preliminary Offering
Memorandum and our historical audited and unaudited consolidated financial
statements and the accompanying notes incorporated by reference into the
Preliminary Offering Memorandum.

 

 

 

As of March 31, 2011

 

(in thousands)

 

Actual

 

As adjusted

 

Cash and cash equivalents

 

$

—

 

$

222,800

 

Indebtedness:

 

 

 

 

 

Senior secured revolving credit facility (1)

 

170,000

 

—

 

9.375% senior notes due 2017

 

527,556

 

527,556

 

Long-term note

 

25,000

 

25,000

 

Notes offered hereby

 

—

 

400,000

 

Total indebtedness

 

722,556

 

952,556

 

Stockholders’ equity:

 

 

 

 

 

Members’ equity in Antero

 

1,461,366

 

1,461,366

 

Accumulated earnings

 

46,246

 

46,246

 

Total equity

 

1,507,612

 

1,507,612

 

Total capitalization

 

$

2,230,168

 

$

2,460,168

 

 

--------------------------------------------------------------------------------

(1)   As of June 30, 2011, the outstanding debt balance under our senior secured
revolving credit facility was approximately $325 million.  In addition, as of
June 30, 2011, we had outstanding letters of credit under such facility of
approximately $19 million.  As of June 30, 2011, after giving effect to the
application of the net proceeds of this offering, we would have had
appropriately $731 million of available borrowing capacity under our senior
secured revolving credit facility.

 

B-2

--------------------------------------------------------------------------------

 

ANNEX C

 

Restrictions on Offers and Sales Outside the United States

 

In connection with offers and sales of Securities outside the United States:

 

(a)           Each Initial Purchaser acknowledges that the Securities have not
been registered under the Securities Act and may not be offered or sold within
the United States or to, or for the account or benefit of, U.S. persons except
pursuant to an exemption from, or in transactions not subject to, the
registration requirements of the Securities Act.

 

(b)           Each Initial Purchaser, severally and not jointly, represents and
warrants to, and agrees with, the Company that:

 

(i)                 Such Initial Purchaser has offered and sold the Securities,
and will offer and sell the Securities, (A) as part of their distribution at any
time and (B) otherwise until 40 days after the later of the commencement of the
offering of the Securities and the Closing Date, only in accordance with
Regulation S under the Securities Act (“Regulation S”) or Rule 144A or any other
available exemption from registration under the Securities Act.

 

(ii)                None of such Initial Purchaser or any of its affiliates or
any other person acting on its or their behalf has engaged or will engage in any
directed selling efforts with respect to the Securities, and all such persons
have complied and will comply with the offering restrictions requirement of
Regulation S.

 

(iii)               At or prior to the confirmation of sale of any Securities
sold in reliance on Regulation S, such Initial Purchaser will have sent to each
distributor, dealer or other person receiving a selling concession, fee or other
remuneration that purchases Securities from it during the distribution
compliance period a confirmation or notice to substantially the following
effect:

 

“The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), and may not be
offered or sold within the United States or to, or for the account or benefit
of, U.S. persons (i) as part of their distribution at any time or (ii) otherwise
until 40 days after the later of the commencement of the offering of the
Securities and the date of original issuance of the Securities, except in
accordance with Regulation S or Rule 144A or any other available exemption from
registration under the Securities Act.  Terms used above have the meanings given
to them by Regulation S.”

 

(iv)               Such Initial Purchaser has not and will not enter into any
contractual arrangement with any distributor with respect to the distribution of
the Securities, except with its affiliates or with the prior written consent of
the Company.

 

C-1

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Terms used in paragraph (a) and this paragraph (b) and not otherwise defined in
this Agreement have the meanings given to them by Regulation S.

 

(c)           Each Initial Purchaser, severally and not jointly, represents and
warrants to, and agrees with, the Company that:

 

(i)         it has only communicated or caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to engage
in investment activity (within the meaning of Section 21 of the United Kingdom
Financial Services and Markets Act 2000 (the “FSMA”)) received by it in
connection with the issue or sale of any Securities in circumstances in which
Section 21(1) of the FSMA does not apply to the Company or the Guarantors; and

 

(ii)        it has complied and will comply with all applicable provisions of
the FSMA with respect to anything done by it in relation to the Securities in,
from or otherwise involving the United Kingdom.

 

(d)           Each Initial Purchaser acknowledges that no action has been or
will be taken by the Company that would permit a public offering of the
Securities, or possession or distribution of any of the Time of Sale
Information, the Offering Memorandum, any Issuer Written Communication or any
other offering or publicity material relating to the Securities, in any country
or jurisdiction where action for that purpose is required.

 

C-2

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ANNEX D

 

Form of Opinion of Vinson & Elkins L.L.P.

 

[provided separately]

 

D-1

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EXHIBIT A

 

[Form of Registration Rights Agreement]

 

Ex-A-1

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