Exhibit 10.1

Execution Version

SANDRIDGE ENERGY, INC.

SANDRIDGE ONSHORE, LLC,

LARIAT SERVICES, INC.,

SANDRIDGE OPERATING COMPANY,

INTEGRA ENERGY, L.L.C.,

SANDRIDGE EXPLORATION AND PRODUCTION, LLC,

SANDRIDGE TERTIARY, LLC,

SANDRIDGE MIDSTREAM, INC.,

SANDRIDGE OFFSHORE, LLC

AND

SANDRIDGE HOLDINGS, INC.

$900,000,000

7.5% Senior Notes due 2021

PURCHASE AGREEMENT

dated March 2, 2011

RBC Capital Markets, LLC

Barclays Capital Inc.

Merrill Lynch, Pierce, Fenner & Smith Incorporated

Mitsubishi UFJ Securities (USA), Inc.

Wells Fargo Securities, LLC

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PURCHASE AGREEMENT

March 2, 2011

RBC CAPITAL MARKETS, LLC

BARCLAYS CAPITAL INC.

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

MITSUBISHI UFJ SECURITIES (USA), INC.

WELLS FARGO SECURITIES, LLC

As Representatives of the Initial Purchasers

set forth on Schedule A hereto

c/o RBC Capital Markets, LLC

Three World Financial Center

200 Vesey Street, 9th Floor

New York, New York 10281

Ladies and Gentlemen:

Introductory. SandRidge Energy, Inc., a Delaware corporation (the “Company”),
proposes to issue and sell to the several Initial Purchasers named in Schedule A
(the “Initial Purchasers”), acting severally and not jointly, the respective
amounts set forth in such Schedule A of $900,000,000 in aggregate principal
amount of the Company’s 7.5% Senior Notes due 2021 (the “Notes”). RBC Capital
Markets, LLC, Barclays Capital Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Mitsubishi UFJ Securities (USA), Inc. and Wells Fargo Securities,
LLC have agreed to act as the representatives of the Initial Purchasers (the
“Representatives”) in connection with the offering and sale of the Notes.

The Notes will be issued pursuant to an indenture, dated as of March 15, 2011
(the “Indenture”), among the Company, the Guarantors (as defined below) and
Wells Fargo Bank, National Association, as trustee (the “Trustee”). Notes will
be issued only in book-entry form in the name of Cede & Co., as nominee of The
Depository Trust Company (the “Depositary”).

The holders of the Notes will be entitled to the benefits of a registration
rights agreement, dated as of the Closing Date (as defined below) (the
“Registration Rights Agreement”), among the Company, the Guarantors and the
Initial Purchasers, pursuant to which the Company and the Guarantors will agree
to file with the Commission (as defined below), under the circumstances set
forth therein, (i) a registration statement under the Securities Act (as defined
below) relating to another series of debt securities of the Company with terms
substantially identical to the Notes (the “Exchange Notes”) to be offered in
exchange for the Notes (the “Exchange Offer”) and (ii) to the extent required by
the Registration Rights Agreement, a shelf registration statement pursuant to
Rule 415 of the Securities Act relating to the resale by certain holders of the
Notes, and in each case, to use its commercially reasonable best efforts to
cause such registration statements to be declared effective.

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The payment of principal of, premium, if any, Additional Interest (as defined in
the Indenture), if any, and interest on the Notes and the Exchange Notes will be
fully and unconditionally guaranteed on a senior unsecured basis, jointly and
severally by (i) SandRidge Onshore, LLC, Lariat Services, Inc., SandRidge
Operating Company, Integra Energy, L.L.C., SandRidge Exploration and Production,
LLC, SandRidge Tertiary, LLC, SandRidge Midstream, Inc., SandRidge Offshore, LLC
and SandRidge Holdings, Inc. and (ii) any subsidiary of the Company formed or
acquired after the Closing Date that executes a supplemental indenture in
accordance with the terms of the Indenture, and their respective successors and
assigns (collectively, the “Guarantors”), pursuant to their guarantees set forth
in the Indenture (the “Guarantees”). The Notes and the Guarantees related
thereto are herein collectively referred to as the “Securities”; and the
Exchange Notes and the Guarantees related thereto are herein collectively
referred to as the “Exchange Securities.”

The Company understands that the Initial Purchasers propose to make an offering
of the Securities on the terms and in the manner set forth herein and in the
Pricing Disclosure Package (as defined below) and agrees that the Initial
Purchasers may resell, subject to the conditions set forth herein, all or a
portion of the Securities to purchasers (the “Subsequent Purchasers”) on the
terms set forth in the Pricing Disclosure Package (it being agreed that the
first time when sales of the Securities are made by the Initial Purchasers is
3:47 p.m. (New York City time) on the date of this Agreement, which time is
hereinafter referred to as the “Time of Sale”). The Securities are to be offered
and sold to or through the Initial Purchasers without being registered with the
Securities and Exchange Commission (the “Commission”) under the Securities Act
of 1933 (as amended, the “Securities Act,” which term, as used herein, includes
the rules and regulations of the Commission promulgated thereunder), in reliance
upon exemptions therefrom. Pursuant to the terms of the Securities and the
Indenture, investors who acquire Securities shall be deemed to have agreed that
Securities may only be resold or otherwise transferred, after the date hereof,
if such Securities are registered for sale under the Securities Act or if an
exemption from the registration requirements of the Securities Act is available
(including the exemptions afforded by Rule 144A under the Securities Act (“Rule
144A”) or Regulation S under the Securities Act (“Regulation S”)).

The Company has prepared and delivered to each Initial Purchaser copies of a
Preliminary Offering Memorandum, dated March 2, 2011, including documents
incorporated by reference therein (the “Preliminary Offering Memorandum”), and
has prepared and delivered to each Initial Purchaser copies of a Pricing
Supplement, dated March 2, 2011, in the form attached hereto as Exhibit C (the
“Pricing Supplement”), describing the terms of the Securities, each for use by
such Initial Purchaser in connection with its solicitation of offers to purchase
the Securities. The Preliminary Offering Memorandum and the Pricing Supplement
are herein referred to as the “Pricing Disclosure Package.” Promptly after this
Agreement is executed and delivered, the Company will prepare and deliver to
each Initial Purchaser a final offering memorandum dated the date hereof
including documents incorporated by reference therein (the “Final Offering
Memorandum”).

All references herein to the terms “Pricing Disclosure Package” and “Final
Offering Memorandum” shall be deemed to mean and include all information filed
under the Securities Exchange Act of 1934 (as amended, the “Exchange Act,” which
term, as used herein, includes the rules and regulations of the Commission
promulgated thereunder) prior to the Time of Sale

 

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and incorporated by reference in the Pricing Disclosure Package (including the
Preliminary Offering Memorandum) or the Final Offering Memorandum (as the case
may be), and all references herein to the terms “amend,” “amendment” or
“supplement” with respect to the Final Offering Memorandum shall be deemed to
mean and include all information filed under the Exchange Act after the Time of
Sale and incorporated by reference in the Final Offering Memorandum.

The Company hereby confirms its agreements with the Initial Purchasers as
follows:

SECTION 1. Representations and Warranties. Each of the Company and the
Guarantors, jointly and severally, hereby represents, warrants and covenants to
each Initial Purchaser that, as of the date hereof and as of the Closing Date
(references in this Section 1 to the “Offering Memorandum” are to (x) the
Pricing Disclosure Package in the case of representations and warranties made as
of the date hereof and (y) the Pricing Disclosure Package and the Final Offering
Memorandum in the case of representations and warranties made as of the Closing
Date):

(a) No Registration Required. Subject to compliance by the Initial Purchasers
with the representations and warranties set forth in Section 2 hereof and with
the procedures set forth in Section 7 hereof, it is not necessary in connection
with the offer, sale and delivery of the Securities to the Initial Purchasers
and to each Subsequent Purchaser in the manner contemplated by this Agreement
and the Offering Memorandum to register the Securities under the Securities Act
or, until such time as the Exchange Securities are issued pursuant to an
effective registration statement, to qualify the Indenture under the Trust
Indenture Act of 1939 (the “Trust Indenture Act,” which term, as used herein,
includes the rules and regulations of the Commission promulgated thereunder).

(b) No Integration of Offerings or General Solicitation. None of the Company,
its affiliates (as such term is defined in Rule 501 under the Securities Act)
(each, an “Affiliate”), or any person acting on its or any of their behalf
(other than the Initial Purchasers, as to whom the Company makes no
representation or warranty) has, directly or indirectly, solicited any offer to
buy or offered to sell, or will, directly or indirectly, solicit any offer to
buy or offer to sell, in the United States or to any United States citizen or
resident, any security which is or would be integrated with the sale of the
Securities in a manner that would require the Securities to be registered under
the Securities Act. None of the Company, its Affiliates, or any person acting on
its or any of their behalf (other than the Initial Purchasers, as to whom the
Company makes no representation or warranty) has engaged or will engage, in
connection with the offering of the Securities, in any form of general
solicitation or general advertising within the meaning of Rule 502 under the
Securities Act. With respect to those Securities sold in reliance upon
Regulation S, (i) none of the Company, its Affiliates or any person acting on
its or their behalf (other than the Initial Purchasers, as to whom the Company
makes no representation or warranty) has engaged or will engage in any directed
selling efforts within the meaning of Regulation S and (ii) each of the Company
and its Affiliates and any person acting on its or their behalf (other than the
Initial Purchasers, as to whom the Company makes no representation or warranty)
has complied and will comply with the offering restrictions set forth in
Regulation S.

 

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(c) Eligibility for Resale under Rule 144A. The Securities are eligible for
resale pursuant to Rule 144A and will not be, at the Closing Date, of the same
class as securities listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a U.S. automated interdealer
quotation system.

(d) The Pricing Disclosure Package and Offering Memorandum. Neither the Pricing
Disclosure Package, as of the Time of Sale, nor the Final Offering Memorandum,
as of its date or (as amended or supplemented in accordance with Section 3(a),
as applicable) as of the Closing Date, contains an untrue statement of a
material fact or omits 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 this representation, warranty and agreement
shall not apply to statements in or omissions from the Pricing Disclosure
Package, the Final Offering Memorandum or any amendment or supplement thereto
made in reliance upon and in conformity with information furnished to the
Company in writing by any Initial Purchaser through RBC Capital Markets, LLC
expressly for use in the Pricing Disclosure Package, the Final Offering
Memorandum or amendment or supplement thereto, as the case may be.

(e) Company Additional Written Communications. The Company has not prepared,
made, used, authorized, approved or distributed and will not prepare, make, use,
authorize, approve or distribute any written communication that constitutes an
offer to sell or a solicitation of an offer to buy the Securities (each such
communication by the Company or its agents and representatives (other than a
communication referred to in clauses (i) and (ii) below) a “Company Additional
Written Communication”) other than (i) the Pricing Disclosure Package, (ii) the
Final Offering Memorandum, and (iii) any electronic road show or other written
communications, in each case used in accordance with Section 3(a). Each such
Company Additional Written Communication, when taken together with the Pricing
Disclosure Package, 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 this representation,
warranty and agreement shall not apply to statements in or omissions from each
such Company Additional Written Communication made in reliance upon and in
conformity with information furnished to the Company in writing by any Initial
Purchaser through RBC Capital Markets, LLC expressly for use in any Company
Additional Written Communication.

(f) Incorporated Documents. The documents incorporated or deemed to be
incorporated by reference in the Offering Memorandum at the time they were or
hereafter are filed with the Commission (collectively, the “Incorporated
Documents”) complied and will comply in all material respects with the
requirements of the Exchange Act.

(g) The Purchase Agreement. This Agreement has been duly authorized, executed
and delivered by the Company and each Guarantor.

(h) The Registration Rights Agreement. The Registration Rights Agreement has
been duly authorized and, on the Closing Date, will have been duly executed and
delivered by, and will constitute a valid and binding agreement of, the Company
and the Guarantors, enforceable in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws relating to

 

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or affecting the rights and remedies of creditors or by general equitable
principles and except as rights to indemnification and contribution under the
Registration Rights Agreement may be limited by applicable law.

(i) Authorization of the Notes, the Guarantees and the Exchange Notes. The Notes
to be purchased by the Initial Purchasers from the Company are substantially in
the form contemplated by the Indenture, have been duly authorized for issuance
and sale pursuant to this Agreement and the Indenture and, at the Closing Date,
will have been duly executed by the Company and, when authenticated in the
manner provided for in the Indenture and delivered against payment of the
purchase price therefor, will constitute valid and binding agreements of the
Company, enforceable in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar laws relating to or affecting the rights
and remedies of creditors or by general equitable principles and will be
entitled to the benefits of the Indenture. The Exchange Notes have been duly and
validly authorized for issuance by the Company, and when issued and
authenticated in accordance with the terms of the Indenture, the Registration
Rights Agreement and the Exchange Offer, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, or similar laws
relating to or affecting enforcement of the rights and remedies of creditors or
by general principles of equity and will be entitled to the benefits of the
Indenture. The Guarantees of the Notes and the Exchange Notes have been duly
authorized for issuance and sale pursuant to this Agreement and the Indenture
and, when the Notes and the Exchange Notes have been authenticated in the manner
provided for in the Indenture and delivered against payment of the purchase
price therefor, will constitute valid and binding agreements of the Guarantors,
enforceable in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles and will be entitled to
the benefits of the Indenture.

(j) Authorization of the Indenture. The Indenture has been duly authorized by
the Company and the Guarantors and, at the Closing Date, will have been duly
executed and delivered by the Company and will constitute a valid and binding
agreement of the Company and the Guarantors, enforceable against the Company and
the Guarantors in accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.

(k) Description of the Securities and the Indenture. The Securities, the
Exchange Securities and the Indenture will conform in all material respects to
the respective statements relating thereto contained in the Offering Memorandum.

(l) No Material Adverse Change; No Material Liability; Dividends, Repurchases
and Redemptions. Except as otherwise disclosed in the Offering Memorandum,
subsequent to the respective dates as of which information is given in the
Offering Memorandum (exclusive of any amendment or supplement thereto):
(i) there has been no material adverse change, or any development that could
reasonably be expected to result in a material adverse change, in the

 

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condition, financial or otherwise, or in the earnings, business, properties,
operations or prospects (other than as a result of developments affecting the
oil and gas industry generally), whether or not arising from transactions in the
ordinary course of business, of the Company and its subsidiaries, considered as
one entity (a “Material Adverse Change”); (ii) the Company and its subsidiaries,
considered as one entity, have not incurred any material liability or
obligation, indirect, direct or contingent, nor entered into any material
transaction or agreement; and (iii) other than with respect to the 8.5%
Convertible Perpetual Preferred Stock of the Company issued on January 21, 2009,
the 6.0% Convertible Perpetual Preferred Stock of the Company issued on
December 16, 2009 and the 7.0% Convertible Perpetual Preferred Stock of the
Company issued on November 10, 2010 and November 15, 2010 (collectively, the
“Preferred Stock”), there has been no cash dividend or distribution of any kind
declared, paid or made by the Company or, except for dividends paid to the
Company or other subsidiaries, any of its subsidiaries on any class of capital
stock or repurchase or redemption by the Company or any of its subsidiaries of
any class of capital stock.

(m) Independent Accountants. PricewaterhouseCoopers LLP, which has expressed its
opinion with respect to certain of the financial statements (which term as used
in this Agreement includes the related notes thereto) and supporting schedules
included in the Offering Memorandum, is an independent registered public
accounting firm with respect to the Company, as required by the Securities Act
and the Exchange Act.

Hansen, Barnett & Maxwell, P.C., which has expressed its opinion with respect to
certain of the financial statements and supporting schedules included in the
Offering Memorandum, is an independent registered public accounting firm with
respect to Arena Resources, Inc., as required by the Securities Act and the
Exchange Act.

(n) Preparation of the Financial Statements. The consolidated historical
financial statements of the Company included in the Offering Memorandum present
fairly the consolidated historical financial position of the entities to which
they relate as of and at the dates indicated and the results of their operations
and cash flows for the periods specified. Such financial statements comply as to
form with the applicable accounting requirements of Regulation S-X and have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved, except as may be expressly
stated in the related notes thereto. The pro forma financial statements of the
Company included in the Offering Memorandum comply as to form with the
applicable requirements of Regulation S-X and give effect to assumptions made on
a reasonable basis as set forth in the Offering Memorandum. The historical
financial data set forth in the Offering Memorandum under the caption “Summary
Consolidated Historical Financial Data” and under the “Actual” column under the
caption “Capitalization” fairly present the information set forth therein on a
basis consistent with that of the financial statements contained in the Offering
Memorandum.

(o) Incorporation and Good Standing of the Company and the Guarantors. Each of
the Company and each Guarantor has been duly incorporated or otherwise formed
and is validly existing and in good standing under the laws of the jurisdiction
of its incorporation or formation, as the case may be, and has power and
authority (corporate or otherwise) to own or lease, as the case may be, and
operate its properties and to conduct its business as described in the Offering
Memorandum and, in the case of the Company and the Guarantors, to enter into and
perform its

 

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obligations under each of this Agreement, the Registration Rights Agreement, the
Securities, the Exchange Securities and the Indenture. Each of the Company and
each Guarantor is duly qualified to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except for such
jurisdictions where the failure to so qualify or to be in good standing would
not, individually or in the aggregate, result in a material adverse effect on
the condition, financial or otherwise, or on the earnings, business, properties
or operations, whether or not arising from transactions in the ordinary course
of business, of the Company and its subsidiaries, considered as one entity (a
“Material Adverse Effect”). All of the issued and outstanding shares of capital
stock, or similar equity interest, of each subsidiary have been duly authorized
and validly issued, are fully paid and nonassessable and, except as set forth on
Schedule B, are owned by the Company, directly or through subsidiaries. All
shares of capital stock, or similar equity interest, so owned are owned free and
clear of any security interest, mortgage, pledge, lien, encumbrance or claim,
other than those granted pursuant to the Amended and Restated Senior Credit
Facility, dated April 22, 2010, by and among SandRidge Energy, Inc. and Bank of
America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and
the other lenders party thereto, as amended (the “Credit Facility”).

(p) Capitalization and Other Capital Stock Matters. The authorized, issued and
outstanding capital stock of the Company is as set forth in the Offering
Memorandum under the caption “Capitalization” (other than for subsequent
issuances, if any, pursuant to employee benefit plans described in the Offering
Memorandum).

(q) Non-Contravention of Existing Instruments; No Further Authorizations or
Approvals Required. Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by laws (or other applicable organizational
document), (ii) is (or, with the giving of notice or lapse of time, would be) in
default (“Default”) under any indenture, mortgage, loan or credit agreement,
note, contract, franchise, lease or other instrument to which the Company or any
of its subsidiaries is a party or by which it or any of them may be bound
(including, without limitation, the Credit Facility), or to which any of the
property or assets of the Company or any of its subsidiaries is subject (each,
an “Existing Instrument”), or (iii) is in violation of any statute, law, rule,
regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority having
jurisdiction over the Company or such subsidiary or any of its properties, as
applicable, except with respect to clauses (ii) and (iii), for such Defaults or
violations as would not, individually or in the aggregate, have a Material
Adverse Effect.

The Company’s and the Guarantors’ execution, delivery and performance of this
Agreement, the Registration Rights Agreement and the Indenture, and the issuance
and delivery of the Securities or the Exchange Securities, and consummation of
the transactions contemplated hereby and thereby and by the Offering Memorandum
(i) have been duly authorized by all necessary action (corporate or otherwise)
and will not result in any violation of the charter or bylaws (or other
applicable organizational document) of the Company or any subsidiary, (ii) will
not conflict with or constitute a breach of, or Default or a Debt Repayment
Triggering Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, or require the consent of any
other party to, any Existing Instrument and (iii) will not result in any
violation of

 

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any statute, law, rule, regulation, judgment, order or decree applicable to the
Company or any of its subsidiaries of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having jurisdiction
over the Company or any of its subsidiaries or any of its or their properties.
As used herein, a “Debt Repayment Triggering Event” means any event or condition
which gives, or with the giving of notice or lapse of time would give, the
holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder’s behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Company or any of
its subsidiaries.

No consent, approval, authorization or other order of, or registration or filing
with, any court or other governmental or regulatory authority or agency is
required for the Company’s and the Guarantors’ execution, delivery and
performance of this Agreement, the Registration Rights Agreement, or the
Indenture, or the issuance and delivery of the Securities or the Exchange
Securities, or consummation of the transactions contemplated hereby and thereby
and by the Offering Memorandum.

(r) No Material Actions or Proceedings. Except as otherwise disclosed in the
Offering Memorandum, there are no legal or governmental actions, suits or
proceedings pending or, to the Company’s knowledge, threatened (i) against or
affecting the Company or any of its subsidiaries, (ii) which has as the subject
thereof any officer or director of, or property owned or leased by, the Company
or any of its subsidiaries or (iii) relating to environmental or discrimination
matters, where in any such case (A) there is a reasonable possibility that such
action, suit or proceeding might be determined adversely to the Company or such
subsidiary and (B) any such action, suit or proceeding, if so determined
adversely, would reasonably be expected to have a Material Adverse Effect or
adversely affect the consummation of the transactions contemplated by this
Agreement.

(s) Labor Matters. No labor problem or dispute with the employees of the Company
or any of its subsidiaries exists or is threatened or imminent that would
reasonably be expected to have a Material Adverse Effect.

(t) Intellectual Property Rights. The Company and its subsidiaries own, possess,
license or have other rights to use, on reasonable terms, all patents, patent
applications, trade and service marks, trade and service mark registrations,
trade names, copyrights, licenses, inventions, trade secrets, technology,
know-how and other intellectual property (collectively, the “Intellectual
Property Rights”) necessary for the conduct of the Company’s business as now
conducted or as proposed in the Offering Memorandum to be conducted except where
the failure to do so would not reasonably be expected to have a Material Adverse
Effect. Except as set forth in the Offering Memorandum, (a) no party has been
granted an exclusive license to use any portion of such Intellectual Property
Rights owned by the Company; (b) to the Company’s knowledge there is no material
infringement by third parties of any such Intellectual Property Rights owned by
or exclusively licensed to the Company; (c) there is no pending or, to the
Company’s knowledge, threatened action, suit, proceeding or claim by others
challenging the Company’s rights in or to any material Intellectual Property
Rights; and (d) there is no pending or, to the Company’s knowledge, threatened
action, suit, proceeding or claim by others that the Company’s business as now
conducted infringes or otherwise violates any patent, trademark, copyright,
trade secret or other proprietary rights of others that, if so determined
adversely,

 

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would reasonably be expected to have a Material Adverse Effect or adversely
affect the consummation of the transactions contemplated by this Agreement, and
the Company is unaware of any other fact which would form a reasonable basis for
any such claim.

(u) All Necessary Permits, etc. The Company and each Guarantor possess such
valid and current licenses, certificates, authorizations or permits issued by
the appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct their respective businesses except where the failure to do
so would not reasonably be expected to have a Material Adverse Effect, and
neither the Company nor any Guarantor has received any notice of proceedings
relating to the revocation or modification of, or non-compliance with, any such
certificate, authorization or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would reasonably be
expected to have a Material Adverse Effect.

(v) Title to Properties. Each of the Company and its subsidiaries has
(i) generally satisfactory title to its oil and gas properties, title
investigations having been carried out by the Company or its subsidiaries in
accordance with the practice in the oil and gas industry in the areas in which
the Company and its subsidiaries operate, (ii) good and marketable title to all
other real property owned by it (including pipeline easement rights) to the
extent necessary to carry on its business, and (iii) good and marketable title
to all personal property owned by it, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Offering Memorandum
or such as do not materially affect the value of the properties of the Company
and its subsidiaries, considered as one enterprise, and do not interfere in any
material respect with the use made and proposed to be made of such properties,
by the Company and its subsidiaries, considered as one enterprise; and all of
the easements, leases and subleases material to the business of the Company and
its subsidiaries, considered as one enterprise, and under which the Company or
any of its subsidiaries holds or uses properties described in the Offering
Memorandum, are in full force and effect, and neither the Company nor any of its
subsidiaries has any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Company or its subsidiaries
under any of the easements, leases or subleases mentioned above, or affecting or
questioning the rights of the Company or any subsidiary thereof to the continued
possession or use of the easement or leased or subleased premises.

(w) Condition of Properties. Except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on the
Company, the plants, buildings, structures and equipment owned by the Company
are in good operating condition and repair and have been reasonably maintained
consistent with standards generally followed in the industry (giving due account
to the age and length of use of same, ordinary wear and tear excepted), are
adequate and suitable for their present uses and, in the case of plants,
buildings and other structures, are structurally sound.

(x) Tax Law Compliance. The Company and its consolidated subsidiaries have filed
all necessary federal, state, local and foreign income and franchise tax returns
in a timely manner and have paid all taxes required to be paid by any of them
and, if due and payable, any related or similar assessment, fine or penalty
levied against any of them, except for any taxes, assessments, fines or
penalties as may be being contested in good faith and by appropriate proceedings
or where the failure to do so would not reasonably be expected to have a
Material Adverse Effect. The Company has made appropriate provisions in the
financial statements included in the

 

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Offering Memorandum in respect of all federal, state and foreign income and
franchise taxes for all current or prior periods as to which the tax liability
of the Company or any of its consolidated subsidiaries has not been finally
determined except to the extent it would not have a Material Adverse Effect.

(y) Company Not an “Investment Company.” The Company is not, and, after receipt
of payment for the Securities and application of the proceeds as described under
“Use of Proceeds” in the Offering Memorandum will not be, required to register
as an “investment company” within the meaning of the Investment Company Act and
will conduct its business in a manner so that it will not become subject to the
Investment Company Act.

(z) Insurance. Each of the Company and its subsidiaries is insured by recognized
and, to the knowledge of the Company, financially sound and reputable
institutions with policies in such amounts and with such deductibles and
covering such risks as are generally deemed adequate and customary for their
businesses including, but not limited to, policies covering real and personal
property owned or leased by the Company and its subsidiaries against theft,
damage, destruction, acts of terrorism or vandalism and earthquakes. All
policies of insurance and fidelity or surety bonds insuring the Company or any
of its subsidiaries or their respective businesses, assets, employees, officers
and directors are in full force and effect; the Company and its subsidiaries are
in compliance, in all material respects, with the terms of such policies and
instruments; and there are no material claims by the Company or any of its
subsidiaries under any such policy or instrument as to which any insurance
company is denying liability or defending under a reservation of rights clause;
and neither the Company nor any such subsidiary has, in the past three years,
been refused any insurance coverage sought or applied for.

(aa) No Price Stabilization or Manipulation. The Company has not taken and will
not take, directly or indirectly, any action designed to or that might be
reasonably expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Securities. The Company acknowledges that the Initial Purchasers may engage in
stabilization transactions as described in the Offering Memorandum.

(bb) Compliance with Sarbanes-Oxley. The Company and its subsidiaries and their
respective officers and directors are in compliance with the applicable
provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act,” which
term, as used herein, includes the rules and regulations of the Commission
promulgated thereunder).

(cc) Internal Controls. The Company maintains effective internal control over
financial reporting as defined in Rule 13a-15 under the Exchange Act and a
system of internal accounting control sufficient to provide reasonable assurance
that (A) transactions are executed in accordance with management’s general or
specific authorization, (B) transactions are recorded as necessary to permit
preparation of the Company’s financial statements in conformity with accounting
principles generally accepted in the United States and to maintain
accountability for its assets, (C) access to the Company’s assets is permitted
only in accordance with management’s general or specific authorization and
(D) the recorded accountability for the Company’s assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.

 

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(dd) Disclosure Controls and Procedures. The Company has established and
maintains disclosure controls and procedures (as such term is defined in Rules
13a-15 and 15d-14 under the Exchange Act); such disclosure controls and
procedures are designed to ensure that material information relating to the
Company and its subsidiaries is made known to the chief executive officer and
chief financial officer of the Company by others within the Company or any of
its subsidiaries, and such disclosure controls and procedures are reasonably
effective to perform the functions for which they were established subject to
the limitations of any such control system; the Company’s auditors and the Audit
Committee of the Board of Directors of the Company have been advised of: (i) any
significant deficiencies or material weaknesses in the design or operation of
internal controls that could adversely affect the Company’s ability to record,
process, summarize, and report financial data; and (ii) any fraud, whether or
not material, that involves management or other employees who have a role in the
Company’s internal controls; and since the date of the most recent evaluation of
such disclosure controls and procedures, there have been no significant changes
in internal controls or in other factors that could significantly affect
internal controls, including any corrective actions with regard to significant
deficiencies and material weaknesses.

(ee) Compliance with Environmental Laws. Except as otherwise disclosed in the
Offering Memorandum: (i) neither the Company nor any of its subsidiaries is in
violation of any federal, state, local or foreign law, regulation, order, permit
or other requirement relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife, including without
limitation, laws and regulations relating to emissions, discharges, releases or
threatened releases of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum and petroleum products
(collectively, “Materials of Environmental Concern”), or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern (collectively,
“Environmental Laws”), which violation includes, but is not limited to,
noncompliance with any permits or other governmental authorizations required for
the operation of the business of the Company or its subsidiaries under
applicable Environmental Laws, or noncompliance with the terms and conditions
thereof, nor has the Company or any of its subsidiaries received any written
communication, whether from a governmental authority, citizens group, employee
or otherwise, that alleges that the Company or any of its subsidiaries is in
violation of any Environmental Law, except, in each case, as would not,
individually or in the aggregate, have a Material Adverse Effect; (ii) there is
no claim, action or cause of action filed with a court or governmental
authority, no investigation with respect to which the Company has received
written notice, and no written notice by any person or entity alleging potential
liability for investigatory costs, cleanup costs, governmental responses costs,
natural resources damages, property damages, personal injuries, attorneys’ fees
or penalties arising out of, based on or resulting from the presence, or release
into the environment, of any Material of Environmental Concern at any location
owned, leased or operated by the Company or any of its subsidiaries, now or in
the past (collectively, “Environmental Claims”), pending or, to the Company’s
knowledge, threatened against the Company or any of its subsidiaries or any
person or entity whose liability for any Environmental Claim the Company or any
of its subsidiaries has retained or assumed either contractually or by operation
of law, except as would not, individually or in the aggregate, have a Material
Adverse Effect; and (iii) to the Company’s knowledge, there are no past, present
or anticipated future actions, activities, circumstances, conditions, events or
incidents, including,

 

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without limitation, the release, emission, discharge, presence or disposal of
any Material of Environmental Concern, that reasonably could result in a
violation of any Environmental Law, require expenditures to be incurred pursuant
to Environmental Law, except as would not, individually or in the aggregate,
have a Material Adverse Effect.

(ff) Independent Petroleum Engineers. DeGolyer and MacNaughton, whose reports as
of December 31, 2008, 2009 and 2010 are referenced in the Offering Memorandum,
was, as of the date of such reports, and is, as of the date hereof, an
independent petroleum engineer with respect to SandRidge Tertiary, LLC (with
respect to the reports as of December 31, 2008, 2009, and 2010). Netherland,
Sewell & Associates Inc., whose reports as of December 31, 2008, 2009 and 2010,
are referenced in the Offering Memorandum, was, as of December 31, 2008, 2009
and 2010, and is, as of the date hereof, an independent petroleum engineer with
respect to the Company (excluding SandRidge Tertiary, LLC). Lee Keeling and
Associates, Inc., whose reports as of December 31, 2009 and 2010 are referenced
in the Offering Memorandum, was, as of December 31, 2009 and 2010, and is, as of
the date hereof, an independent petroleum engineer with respect to the Company.
The information underlying the estimates of reserves of the Company and its
subsidiaries, which was supplied by the Company to DeGolyer and MacNaughton,
Netherland, Sewell & Associates Inc. and Lee Keeling and Associates, Inc. for
purposes of reviewing the reserve reports and estimates of the Company and
preparing the letters (the “Reserve Report Letters”) of DeGolyer and
MacNaughton, Netherland, Sewell & Associates Inc. and Lee Keeling and
Associates, Inc., including, without limitation, production, costs of operation
and development, current prices for production, agreements relating to current
and future operations and sales of production, was true and correct in all
material respects on the dates such estimates were made and such information was
supplied and was prepared in accordance with customary industry practices;
estimates of such reserves and present values as described in the Offering
Memorandum and reflected in the Reserve Report Letters comply in all material
respects with the applicable requirements of Regulation S-X and Regulation S-K
under the Act, as applicable.

(gg) Related Party Transactions. No relationship, direct or indirect, exists
between or among any of the Company or any affiliate of the Company, on the one
hand, and any director, officer, member, stockholder, customer or supplier of
the Company or any affiliate of the Company, on the other hand, which is
required by the Exchange Act to be disclosed in an annual report on Form 10-K
that is not so disclosed in the Offering Memorandum. There are no outstanding
loans, advances (except advances for business expenses in the ordinary course of
business) or guarantees of indebtedness by the Company or any affiliate of the
Company to or for the benefit of any of the officers or directors of the Company
or any affiliate of the Company or any of their respective family members.

(hh) Lending Relationship. Except as disclosed in the Offering Memorandum, to
its knowledge, the Company (i) does not have any material lending or other
relationship with any bank or lending affiliate of any Initial Purchaser and
(ii) does not intend to use any of the proceeds from the sale of the Securities
hereunder to repay any outstanding debt owed to any affiliate of any Initial
Purchaser.

(ii) Solvency. Each of the Company and the Guarantors is, and immediately after
the Closing Date will be, Solvent. As used herein, the term “Solvent” means,
with respect to any

 

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person on a particular date, that on such date (i) the fair market value of the
assets of such person is greater than the total amount of liabilities (including
contingent liabilities) of such person, (ii) the present fair salable value of
the assets of such person is greater than the amount that will be required to
pay the probable liabilities of such person on its debts as they become absolute
and matured, (iii) such person is able to realize upon its assets and pay its
debts and other liabilities, including contingent obligations, as they mature
and (iv) such person does not have unreasonably small capital.

(jj) No Default in Senior Indebtedness. No event of default exists under the
Credit Facility.

(kk) Regulation S. The Company, the Guarantors and their respective affiliates
and all persons acting on their behalf (other than the Initial Purchasers, as to
whom the Company and the Guarantors make no representation) have complied with
and will comply with the offering restrictions requirements of Regulation S in
connection with the offering of the Securities outside the United States and, in
connection therewith, the Offering Memorandum will contain the disclosure
required by Rule 902. The Company is a “reporting issuer”, as defined in
Rule 902 under the Securities Act.

(ll) No Unlawful Payments; Compliance with Anti-Corruption Law. Neither the
Company nor any of its subsidiaries or affiliates, nor any director, officer, or
employee, nor, to the Company’s knowledge, any agent or representative of the
Company or of any of its subsidiaries or affiliates, has taken or will take any
action in furtherance of an offer, payment, promise to pay, or authorization or
approval of the payment or giving of money, property, gifts or anything else of
value, directly or indirectly, to any “government official” (including any
officer or employee of a government or government-owned or controlled entity or
of a public international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or any political party or
party official or candidate for political office) to influence official action
or secure an improper advantage; and the Company and its subsidiaries and
affiliates have conducted their businesses in compliance with applicable
anti-corruption laws and have instituted and maintain and will continue to
maintain policies and procedures designed to promote and achieve compliance with
such laws and with the representation and warranty contained herein.

(mm) Compliance with USA PATRIOT Act and Money Laundering Laws. The operations
of the Company and its subsidiaries are and have been conducted at all times in
material compliance with all applicable financial recordkeeping and reporting
requirements, including those of the Bank Secrecy Act, as amended by Title III
of the Uniting and Strengthening America by Providing Appropriate Tools Required
to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the
applicable anti-money laundering statutes of jurisdictions where the Company and
its subsidiaries conduct business, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued, administered or
enforced by any governmental agency (collectively, the “Anti-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 Company or any of its
subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to
the best knowledge of the Company, threatened.

 

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(nn) Compliance with OFAC.

(A) The Company represents that neither the Company nor any of its subsidiaries
(collectively, the “Entity”) or, to the knowledge of the Entity, any director,
officer, employee, agent, affiliate or representative of the Entity, is an
individual or entity (“Person”) that is, or is owned or controlled by a Person
that is:

(1) the subject of any sanctions administered or enforced by the U.S. Department
of Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations
Security Council (“UNSC”), the European Union (“EU”), Her Majesty’s Treasury
(“HMT”), or other relevant sanctions authority (collectively, “Sanctions”), nor

(2) located, organized or resident in a country or territory that is the subject
of Sanctions (including, without limitation, Burma/Myanmar, Cuba, Iran, North
Korea, Sudan and Syria).

(B) The Company represents and covenants that it will not, directly or
indirectly, use the proceeds of the offering, or lend, contribute or otherwise
make available such proceeds to any subsidiary, joint venture partner or other
Person:

(1) to fund or facilitate any activities or business of or with any Person or in
any country or territory that, at the time of such funding or facilitation, is
the subject of Sanctions; or

(2) in any other manner that will result in a violation of Sanctions by any
Person (including any Person participating in the offering, whether as
underwriter, advisor, investor or otherwise).

(C) The Entity represents and covenants that for the past 5 years, it has not
knowingly engaged in, is not now knowingly engaged in, and will not engage in,
any dealings or transactions with any Person, or in any country or territory,
that at the time of the dealing or transaction is or was the subject of
Sanctions.

Any certificate signed by an officer of the Company or any Guarantor and
delivered to the Initial Purchasers or to counsel for the Initial Purchasers
shall be deemed to be a representation and warranty by the Company or such
Guarantor to each Initial Purchaser as to the matters set forth therein.

SECTION 2. Purchase, Sale and Delivery of the Securities.

(a) The Securities. Each of the Company and the Guarantors agrees to issue and
sell to the Initial Purchasers, severally and not jointly, all of the
Securities, and the Initial Purchasers agree, severally and not jointly, to
purchase from the Company and the Guarantors the aggregate principal amount of
Securities set forth opposite their names on Schedule A, at a purchase price of
98.000% of the principal amount thereof plus accrued interest, if any, from
March 15, 2011, in each case, on the basis of the representations, warranties
and agreements herein contained, and upon the terms, subject to the conditions
thereto, herein set forth.

 

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(b) The Closing Date. The closing of the transactions contemplated hereby (the
“Closing”) shall occur at the offices of Vinson & Elkins L.L.P., 1001 Fannin,
Suite 2500, Houston, Texas 77007 (or such other place as may be agreed to by the
Company and RBC Capital Markets, LLC) at 9:00 a.m. New York City time, on
March 15, 2011 or such other time and date as RBC Capital Markets, LLC shall
designate by notice to the Company (the time and date of such closing are called
the “Closing Date”). The Company hereby acknowledges that circumstances under
which RBC Capital Markets, LLC may provide notice to postpone the Closing Date
as originally scheduled include, but are in no way limited to, any determination
by the Company or the Initial Purchasers to recirculate to investors copies of
an amended or supplemented Offering Memorandum or a delay as contemplated by the
provisions of Section 16 hereof.

(c) Delivery of the Securities. At the Closing, the Company shall deliver, or
cause to be delivered, the Notes to RBC Capital Markets, LLC for the accounts of
the several Initial Purchasers, through the facilities of the DTC, against the
irrevocable release of a wire transfer of immediately available funds for the
amount of the purchase price therefor. The Notes shall be in global form,
registered in the name of Cede & Co., as nominee of the Depositary, broken out
as to principal amount between Notes sold pursuant to Rule 144A and Notes sold
pursuant to Regulation S as advised by RBC Capital Markets, LLC, and shall be
delivered to the Trustee, as custodian for DTC, at the Closing. Time shall be of
the essence, and delivery at the time and place specified in this Agreement is a
further condition to the obligations of the Initial Purchasers.

(d) Initial Purchasers as Qualified Institutional Buyers. Each Initial Purchaser
severally and not jointly represents and warrants to, and agrees with, the
Company that it is a “qualified institutional buyer” within the meaning of Rule
144A (a “Qualified Institutional Buyer”).

SECTION 3. Additional Covenants. Each of the Company and the Guarantors further
covenants and agrees with each Initial Purchaser as follows:

(a) Preparation of Final Offering Memorandum; Review of Proposed Amendments and
Supplements and Company Additional Written Communications. As promptly as
practicable following the Time of Sale and in any event not later than the
second business day following the date hereof, the Company will prepare and
deliver to the Initial Purchasers the Final Offering Memorandum, which shall
consist of the Preliminary Offering Memorandum as modified only to reflect the
information contained in the Pricing Supplement. The Company will not amend or
supplement the Preliminary Offering Memorandum or the Pricing Supplement. The
Company will not amend or supplement the Final Offering Memorandum prior to the
Closing Date unless RBC Capital Markets, LLC shall previously have been
furnished a copy of the proposed amendment or supplement prior to the proposed
use or filing, and shall not have objected to such amendment or supplement.
Before making, preparing, using, authorizing, approving or distributing any
Company Additional Written Communication, the Company will furnish to the
Initial Purchasers a copy of such written communication for review and will not
make, prepare, use, authorize, approve or distribute any such written
communication to which RBC Capital Markets, LLC reasonably objects.

 

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(b) Amendments and Supplements to the Final Offering Memorandum and Other
Securities Act Matters. If, prior to the later of (x) the Closing Date and
(y) the completion of the placement of the Securities by the Initial Purchasers
with the Subsequent Purchasers, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Final Offering
Memorandum, as then amended or supplemented, in order to make the statements
therein, in the light of the circumstances when the Final Offering Memorandum is
delivered to a Subsequent Purchaser, not misleading, or if in the judgment of
the Initial Purchasers or counsel for the Initial Purchasers it is otherwise
necessary to amend or supplement the Pricing Disclosure Package or the Final
Offering Memorandum to comply with law, the Company agrees to promptly prepare
(subject to Section 3 hereof) and furnish at its own expense to the Initial
Purchasers, amendments or supplements to the Pricing Disclosure Package and the
Final Offering Memorandum so that the statements in the Pricing Disclosure
Package and the Final Offering Memorandum as so amended or supplemented will
not, in the light of the circumstances at the Closing Date and at the time of
sale of Securities, be misleading or so that the Pricing Disclosure Package and
the Final Offering Memorandum, as amended or supplemented, will comply with all
applicable law.

(c) Copies of the Offering Memorandum. The Company agrees to furnish the Initial
Purchasers, without charge, as many copies of the Pricing Disclosure Package and
the Final Offering Memorandum and any amendments and supplements thereto as they
shall have reasonably requested.

(d) Blue Sky Compliance. Each of the Company and the Guarantors shall cooperate
with the Initial Purchasers and counsel for the Initial Purchasers to qualify or
register (or to obtain exemptions from qualifying or registering) all or any
part of the Securities for offer and sale under the securities laws of the
several states of the United States, the provinces of Canada or any other
jurisdictions designated by the Initial Purchasers, shall comply with such laws
and shall continue such qualifications, registrations and exemptions in effect
so long as required for the distribution of the Securities. None of the Company
nor any of the Guarantors shall be required to qualify as a foreign corporation
or to take any action that would subject it to general service of process in any
such jurisdiction where it is not presently qualified or where it would be
subject to taxation as a foreign corporation. The Company will advise the
Initial Purchasers promptly of the suspension of the qualification or
registration of (or any such exemption relating to) the Securities for offering,
sale or trading in any jurisdiction or any initiation or threat of any
proceeding for any such purpose, and in the event of the issuance of any order
suspending such qualification, registration or exemption, each of the Company
and the Guarantors shall use its best efforts to obtain the withdrawal thereof
at the earliest possible moment.

(e) Use of Proceeds. The Company shall apply the net proceeds from the sale of
the Securities sold by it in the manner described under the caption “Use of
Proceeds” in the Pricing Disclosure Package.

(f) The Depositary. The Company will cooperate with the Initial Purchasers and
use its best efforts to permit the Securities to be eligible for clearance and
settlement through the facilities of the Depositary.

 

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(g) Additional Issuer Information. Prior to the completion of the placement of
the Securities by the Initial Purchasers with the Subsequent Purchasers, the
Company shall file, on a timely basis, with the Commission and the NYSE all
reports and documents required to be filed under Section 13 or 15 of the
Exchange Act. Additionally, at any time when the Company is not subject to
Section 13 or 15 of the Exchange Act, for the benefit of holders and beneficial
owners from time to time of the Securities, the Company shall furnish, at its
expense, upon request, to holders and beneficial owners of Securities and
prospective purchasers of Securities information (“Additional Issuer
Information”) satisfying the requirements of Rule 144A(d).

(h) Agreement Not To Offer or Sell Additional Securities. For a period
commencing on the date hereof and ending on the 60th day after the date of the
Offering Memorandum, the Company agrees not to, without the prior written
consent of RBC Capital Markets, LLC, on behalf of the several Initial Purchasers
(which consent may be withheld at the sole discretion of RBC Capital Markets,
LLC), directly or indirectly, sell, offer, contract or grant any option to sell
(including without limitation any short sale), pledge, transfer, establish an
open “put equivalent position” or liquidate or decrease a “call equivalent
position” within the meaning of Rule 16a-1 under the Exchange Act, or otherwise
dispose of or transfer (or enter into any transaction or device that is designed
to, or could be expected to, result in the disposition by the Company at any
time in the future of), or file (or participate in the filing of) a registration
statement with the Commission in respect of, any debt securities of the Company,
or securities exchangeable or exercisable for or convertible into debt
securities of the Company (other than as contemplated by this Agreement and to
register the Exchange Securities).

(i) Future Reports to the Initial Purchasers. At any time when the Company is
not subject to Section 13 or 15 of the Exchange Act and any Securities or
Exchange Securities remain outstanding, the Company will furnish to RBC Capital
Markets, LLC: (i) as soon as practicable after the end of each fiscal year,
copies of the Annual Report of the Company containing the balance sheet of the
Company as of the close of such fiscal year and statements of income,
stockholders’ equity and cash flows for the year then ended and the opinion
thereon of the Company’s independent public or certified public accountants;
(ii) as soon as practicable after the filing thereof, copies of each proxy
statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current
Report on Form 8-K or other report filed by the Company with the Commission, the
Financial Industry Regulatory Authority, Inc. (the “FINRA”) or any securities
exchange; and (iii) as soon as available, copies of any report or communication
of the Company mailed generally to holders of its capital stock or debt
securities (including the holders of the Securities), if, in each case, such
documents are not filed with the Commission within the time periods specified by
the Commission’s rules and regulations under Section 13 or 15 of the Exchange
Act.

(j) No Integration. The Company agrees that it will not and will cause its
Affiliates not to make any offer or sale of securities of the Company of any
class if, as a result of the doctrine of “integration” referred to in Rule 502
under the Securities Act, such offer or sale would render invalid (for the
purpose of (i) the sale of the Securities by the Company to the Initial
Purchasers, (ii) the resale of the Securities by the Initial Purchasers to
Subsequent Purchasers or (iii) the resale of the Securities by such Subsequent
Purchasers to others) the exemption from the registration requirements of the
Securities Act provided by Section 4(2) thereof or by Rule 144A or by Regulation
S thereunder or otherwise.

 

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(k) No Restricted Resales. During the period of one year after the Closing Date,
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 Notes which constitute
“restricted securities” under Rule 144 that have been reacquired by any of them.

(l) Legended Securities. Each certificate for a Note will bear the legend
contained in “Transfer Restrictions” in the Preliminary Offering Memorandum for
the time period and upon the other terms stated in the Preliminary Offering
Memorandum.

RBC Capital Markets, LLC, on behalf of the several Initial Purchasers, may, in
its sole discretion, waive in writing the performance by the Company or any
Guarantor of any one or more of the foregoing covenants or extend the time for
their performance.

SECTION 4. Payment of Expenses. Each of the Company and the Guarantors agrees to
pay all costs, fees and expenses incurred in connection with the performance of
its obligations hereunder and in connection with the transactions contemplated
hereby, including, without limitation, (i) all expenses incident to the issuance
and delivery of the Securities (including all printing and engraving costs),
(ii) all necessary issue, transfer and other stamp taxes in connection with the
issuance and sale of the Securities to the Initial Purchasers, (iii) all fees
and expenses of the Company’s and the Guarantors’ counsel, independent public or
certified public accountants and other advisors, (iv) all costs and expenses
incurred in connection with the preparation, printing, filing, shipping and
distribution of the Pricing Disclosure Package and the Final Offering Memorandum
(including financial statements and exhibits), and all amendments and
supplements thereto, this Agreement, the Registration Rights Agreement, the
Indenture and the Notes and Guarantees, (v) all filing fees, attorneys’ fees and
expenses incurred by the Company, the Guarantors or the Initial Purchasers in
connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Securities for offer
and sale under the securities laws of the several states of the United States,
the provinces of Canada or other jurisdictions designated by the Initial
Purchasers (including, without limitation, the cost of preparing, printing and
mailing preliminary and final blue sky or legal investment memoranda and any
related supplements to the Pricing Disclosure Package or the Final Offering
Memorandum, (vi) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee in connection with the Indenture, the
Securities and the Exchange Securities, (vii) any fees payable in connection
with the rating of the Securities or the Exchange Securities with the ratings
agencies, (viii) any filing fees incident to, and any reasonable fees and
disbursements of counsel to the Initial Purchasers in connection with the review
by the FINRA, if any, of the terms of the sale of the Securities or the Exchange
Securities, and (ix) all fees and expenses (including reasonable fees and
expenses of counsel) of the Company and the Guarantors in connection with
approval of the Securities by the Depositary for “book-entry” transfer, and the
performance by the Company and the Guarantors of their respective other
obligations under this Agreement and (x) the expenses incident to the “road
show” for the offering of the Securities, including the travel and lodging
expenses of representatives and officers of the Company. Except as provided in
this Section 4 and Sections 6, 8 and 9 hereof, the Initial Purchasers shall pay
their own expenses, including the fees and disbursements of their counsel.

 

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SECTION 5. Conditions of the Obligations of the Initial Purchasers. The
obligations of the several Initial Purchasers to purchase and pay for the
Securities as provided herein on the Closing Date shall be subject to the
accuracy of the representations and warranties on the part of the Company and
the Guarantors set forth in Section 1 hereof as of the date hereof and as of the
Closing Date as though then made and to the timely performance by the Company of
its covenants and other obligations hereunder, and to each of the following
additional conditions:

(a) Accountants’ Comfort Letter and Accountants’ Bring Down Comfort Letter. On
the date hereof, the Initial Purchasers shall have received from
PricewaterhouseCoopers LLP, independent public accountants for the Company, and
Hansen, Barnett & Maxwell, P.C., independent registered public accountants for
Arena Resources, Inc., a “comfort letter” dated the date hereof addressed to the
Initial Purchasers, in form and substance satisfactory to the Initial
Purchasers, covering the financial information in the Preliminary Offering
Memorandum and the Pricing Supplement and other customary matters. In addition,
on the Closing Date, the Initial Purchasers shall have received from
PricewaterhouseCoopers LLP, a “bring-down comfort letter” dated the Closing Date
addressed to the Initial Purchasers, in form and substance satisfactory to the
Initial Purchasers, in the form of the “comfort letter” delivered on the date
hereof, except that (i) it shall cover the financial information in the Final
Offering Memorandum and any amendment or supplement thereto and (ii) procedures
shall be brought down to a date no more than 5 days prior to the Closing Date.

(b) No Material Adverse Change or Ratings Agency Change. For the period from and
after the date of this Agreement and prior to the Closing Date:

(i) in the judgment of the Representatives there shall not have occurred any
Material Adverse Change; and

(ii) there shall not have occurred any downgrading, nor shall any notice have
been given of any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the possible change, in
the rating accorded any securities or indebtedness of the Company or any of its
subsidiaries by a nationally recognized statistical rating organization
registered as such under Section 15E of the Securities Exchange Act of 1934, as
amended; and

(iii) there shall not have been any change or decrease specified in the letter
or letters referred to in paragraph (a) of this Section 5 which is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of the Notes
as contemplated by the Preliminary Offering Memorandum and the Pricing
Supplement.

(c) Opinion of Counsel for the Company. On the Closing Date the Initial
Purchasers shall have received the favorable opinion of (i) Covington & Burling
LLP, counsel for the Company, dated as of such Closing Date, the form of which
is attached as Exhibit A-1 and (ii) appropriate counsel of the Company, dated as
of such Closing Date, the form of which is attached as Exhibit A-2.

 

19

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(d) Opinion of Counsel for the Initial Purchasers. On the Closing Date the
Initial Purchasers shall have received the favorable opinion of Vinson & Elkins
L.L.P., counsel for the Initial Purchasers, dated as of such Closing Date, with
respect to such matters as may be reasonably requested by the Initial
Purchasers.

(e) Officers’ Certificate. On the Closing Date the Initial Purchasers shall have
received a written certificate executed by the Chairman of the Board, Chief
Executive Officer or President of the Company and each Guarantor and the Chief
Financial Officer or Chief Accounting Officer of the Company and each Guarantor,
dated as of the Closing Date, to the effect set forth in Section 5(b)(ii)
hereof, and further to the effect that:

(i) for the period from and after the date of this Agreement and prior to the
Closing Date there has not occurred any Material Adverse Change;

(ii) the representations, warranties and covenants of the Company set forth in
Section 1 and Section 3 hereof, respectively, were true and correct as of the
date hereof and are true and correct as of the Closing Date with the same force
and effect as though expressly made on and as of the Closing Date;

(iii) no event of default exists under the Credit Facility; and

(iv) the Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the Closing
Date.

(f) Registration Rights Agreement. The Company and the Guarantors shall have
entered into the Registration Rights Agreement and the Initial Purchasers shall
have received executed counterparts thereof.

(g) Engineers’ Comfort Letters. On the date hereof, the Initial Purchasers shall
have received from Netherland, Sewell & Associates Inc. and Lee Keeling and
Associates, Inc., independent petroleum engineers, a letter dated the date
hereof addressed to the Initial Purchasers, the forms of which are attached as
Exhibit B-1 and Exhibit B-2, respectively.

(h) Additional Documents. On or before the Closing Date, the Initial Purchasers
and counsel for the Initial Purchasers shall have received such information,
documents and opinions as they may reasonably require for the purposes of
enabling them to pass upon the issuance and sale of the Securities as
contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained.

If any condition specified in this Section 5 is not satisfied when and as
required to be satisfied, this Agreement may be terminated by the Initial
Purchasers by notice to the Company at any time on or prior to the Closing Date,
which termination shall be without liability on the part of any party to any
other party, except that Sections 4, 6, 8 and 9 hereof shall at all times be
effective and shall survive such termination.

SECTION 6. Reimbursement of Initial Purchasers’ Expenses. If this Agreement is
terminated by the Initial Purchasers pursuant to Section 5 hereof, including if
the sale to the

 

20

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Initial Purchasers of the Securities on the Closing Date is not consummated
because of any refusal, inability or failure on the part of the Company to
perform any agreement herein or to comply with any provision hereof, the Company
agrees to reimburse the Initial Purchasers, severally, upon demand for all
reasonable out-of-pocket expenses that shall have been reasonably incurred by
the Initial Purchasers in connection with the proposed purchase and the offering
and sale of the Securities, including, without limitation, fees and
disbursements of counsel, printing expenses, travel expenses, postage, facsimile
and telephone charges. If this Agreement is terminated pursuant to Section 16 by
reason of the default of one or more Initial Purchasers, the Company shall not
be obligated to reimburse any defaulting Initial Purchaser on account of those
expenses.

SECTION 7. Offer, Sale and Resale Procedures. Each of the Initial Purchasers, on
the one hand, and the Company and each of the Guarantors, on the other hand,
hereby agree to observe the following procedures in connection with the offer
and sale of the Securities:

(A) Offers and sales of the Securities will be made only by the Initial
Purchasers or Affiliates thereof qualified to do so in the jurisdictions in
which such offers or sales are made. Each such offer or sale shall only be made
to persons whom the offeror or seller reasonably believes to be Qualified
Institutional Buyers or non-U.S. persons outside the United States to whom the
offeror or seller reasonably believes offers and sales of the Securities may be
made in reliance upon Regulation S upon the terms and conditions set forth in
Annex I hereto, which Annex I is hereby expressly made a part hereof.

(B) The Securities will be offered by approaching prospective Subsequent
Purchasers on an individual basis. No general solicitation or general
advertising (within the meaning of Rule 502 under the Securities Act) will be
used in the United States in connection with the offering of the Securities.

(C) Upon original issuance by the Company, and until such time as the same is no
longer required under the applicable requirements of the Securities Act, the
Notes (and all securities issued in exchange therefor or in substitution
thereof, other than the Exchange Notes) shall bear the legend specified in
Exhibit C to the Indenture:

Following the sale of the Securities by the Initial Purchasers to Subsequent
Purchasers pursuant to the terms hereof, the Initial Purchasers shall not be
liable or responsible to the Company for any losses, damages or liabilities
suffered or incurred by the Company, including any losses, damages or
liabilities under the Securities Act, arising from or relating to any resale or
transfer of any Security.

SECTION 8. Indemnification.

(a) Indemnification of the Initial Purchasers. Each of the Company and the
Guarantors, jointly and severally, agrees to indemnify and hold harmless each
Initial Purchaser, its directors, officers and employees, and each person, if
any, who controls any Initial Purchaser within the meaning of the Securities Act
and the Exchange Act against any loss, claim, damage, liability or expense, as
incurred, to which such Initial Purchaser, director, officer, employee or

 

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controlling person may become subject, under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of the Company), insofar as such loss, claim,
damage, liability or expense (or actions in respect thereof as contemplated
below) arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in the Pricing Disclosure Package, any
Company Additional Written Information or the Final Offering Memorandum (or any
amendment or supplement thereto), or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; and to
reimburse each Initial Purchaser and each such director, officer, employee or
controlling person for any and all expenses (including the fees and
disbursements of counsel chosen by RBC Capital Markets, LLC) as such expenses
are reasonably incurred by such Initial Purchaser or such director, officer,
employee or controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage, liability,
expense or action; provided, however, that the foregoing indemnity agreement
shall not apply to any loss, claim, damage, liability or expense to the extent,
but only to the extent, arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company by the
Initial Purchasers expressly for use in the Pricing Disclosure Package, any
Company Additional Written Information or the Final Offering Memorandum (or any
amendment or supplement thereto). The indemnity agreement set forth in this
Section 8(a) shall be in addition to any liabilities that the Company may
otherwise have.

(b) Indemnification of the Company and the Guarantors. Each Initial Purchaser
agrees, severally and not jointly, to indemnify and hold harmless the Company,
each Guarantor, each of their respective directors and each person, if any, who
controls the Company or any Guarantor within the meaning of the Securities Act
or the Exchange Act, against any loss, claim, damage, liability or expense, as
incurred, to which the Company, any Guarantor or any such director or
controlling person may become subject, under the Securities Act, the Exchange
Act, or other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of such Initial Purchaser), insofar as such
loss, claim, damage, liability or expense (or actions in respect thereof as
contemplated below) arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in the Pricing Disclosure
Package, any Company Additional Written Information or the Final Offering
Memorandum (or any amendment or supplement thereto), or the omission or alleged
omission therefrom of 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 to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in the Pricing Disclosure Package, any Company Additional Written Information or
the Final Offering Memorandum (or any amendment or supplement thereto), in
reliance upon and in conformity with written information furnished to the
Company by such Initial Purchaser expressly for use therein; and to reimburse
the Company, any Guarantor and each such director or controlling person for any
and all expenses (including the fees and disbursements of counsel) as such
expenses are reasonably incurred by the Company, any Guarantor or such director
or controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action. Each of the Company and the Guarantors

 

22

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hereby acknowledges that the only information that the Initial Purchasers have
furnished to the Company expressly for use in the Pricing Disclosure Package,
any Company Additional Written Information or the Final Offering Memorandum (or
any amendment or supplement thereto) are the statements set forth in the second
and third sentences of the 6th paragraph and the entire 21st paragraph under the
caption “Plan of Distribution” in the Preliminary Offering Memorandum and the
Final Offering Memorandum. The indemnity agreement set forth in this
Section 8(b) shall be in addition to any liabilities that each Initial Purchaser
may otherwise have.

(c) Notifications and Other Indemnification Procedures. Promptly after receipt
by an indemnified party under this Section 8 of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party under this Section 8, notify the indemnifying
party in writing of the commencement thereof, but the omission so to notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party for contribution or otherwise than under the indemnity
agreement contained in this Section 8 or to the extent it is not materially
prejudiced as a proximate result of such failure. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof; provided,
however, if the defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably
concluded that a conflict may arise between the positions of the indemnifying
party and the indemnified party in conducting the defense of any such action the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of such indemnifying
party’s election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless the indemnified party shall have employed separate counsel in
accordance with the proviso to the next preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel (together with local counsel), approved by the
indemnifying party (RBC Capital Markets, LLC in the case of Sections 8(b) and 9
hereof), representing the indemnified parties who are parties to such action).

(d) Settlements. The indemnifying party under this Section 8 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 party agrees to indemnify the indemnified party against any
loss, claim, damage, liability or expense by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement, compromise or consent to the entry of
judgment in any pending or threatened action, suit or proceeding in respect of
which any indemnified party is or could have been a party and indemnity was or
could have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent (i) includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such action, suit or proceeding and (ii) does not include any statements as to
or any findings of fault, culpability or failure to act by or on behalf of any
indemnified party.

 

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SECTION 9. Contribution. If the indemnification provided for in Section 8 hereof
is for any reason held to be unavailable to or otherwise insufficient to hold
harmless an indemnified party in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount paid or payable by such indemnified party, as
incurred, as a result of any losses, claims, damages, liabilities or expenses
referred to therein (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors, on the one hand,
and the Initial Purchasers, on the other hand, from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Guarantors, on the one
hand, and the Initial Purchasers, on the other hand, in connection with the
offering of the Securities pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Securities pursuant to this Agreement (before deducting expenses) received
by the Company, and the total discount received by the Initial Purchasers bear
to the aggregate initial offering price of the Securities. The relative fault of
the Company and the Guarantors, on the one hand, and the Initial Purchasers, on
the other hand, shall be determined by reference to, among other things, whether
any such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact or any such inaccurate or alleged
inaccurate representation or warranty relates to information supplied by the
Company and the Guarantors, on the one hand, or the Initial Purchasers, on the
other hand, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission or inaccuracy.

The amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and expenses referred to above shall be deemed to include,
subject to the limitations set forth in Section 8 hereof, any legal or other
fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8 hereof with respect to notice of commencement of any action shall
apply if a claim for contribution is to be made under this Section 9; provided,
however, that no additional notice shall be required with respect to any action
for which notice has been given under Section 8 hereof for purposes of
indemnification.

The Company, the Guarantors and the Initial Purchasers agree that it would not
be just and equitable if contribution pursuant to this Section 9 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 which does not
take account of the equitable considerations referred to in this Section 9.

Notwithstanding the provisions of this Section 9, no Initial Purchaser shall be
required to contribute any amount in excess of the discount received by such
Initial Purchaser in connection

 

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with the Securities distributed by it. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11 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 9 are several, and not joint, in proportion to their
respective commitments as set forth opposite their names in Schedule A. For
purposes of this Section 9, each director, officer and employee of an Initial
Purchaser and each person, if any, who controls an Initial Purchaser within the
meaning of the Securities Act and the Exchange Act shall have the same rights to
contribution as such Initial Purchaser, and each director of the Company or any
Guarantor, and each person, if any, who controls the Company or any Guarantor
within the meaning of the Securities Act and the Exchange Act shall have the
same rights to contribution as the Company and the Guarantors.

SECTION 10. Termination of this Agreement. Prior to the Closing Date, this
Agreement may be terminated by the Representatives by notice given to the
Company if at any time (i) trading in securities generally on either the New
York Stock Exchange shall have been suspended or materially limited, or minimum
or maximum prices shall have been generally established on any of such stock
exchanges by the Commission or the FINRA; (ii) a general banking moratorium
shall have been declared by any federal or New York authority or a material
disruption in commercial banking or securities settlement or clearance services
in the United States has occurred; or (iii) there shall have occurred any
outbreak or escalation of national or international hostilities or any crisis or
calamity, or any change in the United States or international financial markets,
or any substantial change or development involving a prospective substantial
change in United States’ or international political, financial or economic
conditions, as in the judgment of the Representatives is material and adverse
and makes it impracticable or inadvisable to market the Notes in the manner and
on the terms described in the Offering Memorandum or to enforce contracts for
the sale of securities.

SECTION 11. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of the
Company, the Guarantors, their respective officers and the several Initial
Purchasers set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation made by or on behalf of any
Initial Purchaser, the Company, any Guarantor or any of their partners, officers
or directors or any controlling person, as the case may be, and will survive
delivery of and payment for the Securities sold hereunder and any termination of
this Agreement.

SECTION 12. Notices. All communications hereunder shall be in writing and shall
be mailed, hand delivered, couriered or facsimiled and confirmed to the parties
hereto as follows:

If to the Initial Purchasers:

RBC Capital Markets, LLC

Three World Financial Center

200 Vesey Street, 9th Floor

New York, New York 10281

Facsimile: 212-858-7455

Attention: Legal Department

 

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with a copy to:

Vinson & Elkins L.L.P.

1001 Fannin, Suite 2500

Houston, Texas 77002

Facsimile: 713-615-5139

Attention: Matthew R. Pacey

If to the Company or the Guarantors:

SandRidge Energy, Inc.

123 Robert S. Kerr Avenue

Oklahoma City, Oklahoma 73102

Facsimile: 405-429-5983

Attention: General Counsel

with a copy to:

Covington & Burling LLP

1201 Pennsylvania Avenue, N.W.

Washington, D.C. 20004

Facsimile: 202-778-5307

Attention: David H. Engvall

Any party hereto may change the address or facsimile number for receipt of
communications by giving written notice to the others.

SECTION 13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto, including any substitute Initial Purchasers
pursuant to Section 16 hereof, and to the benefit of the indemnified parties
referred to in Sections 8 and 9 hereof, and in each case their respective
successors, and no other person will have any right or obligation hereunder. The
term “successors” shall not include any Subsequent Purchaser of other purchaser
of the Securities as such from any of the Initial Purchasers merely by reason of
such purchase.

SECTION 14. Partial Unenforceability. The invalidity or unenforceability of any
section, paragraph or provision of this Agreement shall not affect the validity
or enforceability of any other section, paragraph or provision hereof. If any
section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.

SECTION 15. Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD
TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

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SECTION 16. Default of One or More of the Several Initial Purchasers. If any one
or more of the several Initial Purchasers shall fail or refuse to purchase
Securities that it or they have agreed to purchase hereunder on the Closing
Date, and the aggregate number of Securities which such defaulting Initial
Purchaser or Initial Purchasers agreed but failed or refused to purchase does
not exceed 10% of the aggregate number of the Securities to be purchased on such
date, the other Initial Purchasers shall be obligated, severally, in the
proportions that the number of Securities set forth opposite their respective
names on Schedule A bears to the aggregate number of Securities set forth
opposite the names of all such non-defaulting Initial Purchasers, or in such
other proportions as may be specified by the Initial Purchasers with the consent
of the non-defaulting Initial Purchasers, to purchase the Securities which such
defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused
to purchase on the Closing Date. If any one or more of the Initial Purchasers
shall fail or refuse to purchase Securities and the aggregate number of
Securities with respect to which such default occurs exceeds 10% of the
aggregate number of Securities to be purchased on the Closing Date, and
arrangements satisfactory to the Initial Purchasers and the Company for the
purchase of such Securities are not made within 48 hours after such default,
this Agreement shall terminate without liability of any party to any other party
except that the provisions of Sections 4, 6, 8 and 9 hereof shall at all times
be effective and shall survive such termination. In any such case either the
Initial Purchasers or the Company shall have the right to postpone the Closing
Date, as the case may be, but in no event for longer than seven days in order
that the required changes, if any, to the Final Offering Memorandum or any other
documents or arrangements may be effected.

As used in this Agreement, the term “Initial Purchaser” shall be deemed to
include any person substituted for a defaulting Initial Purchaser under this
Section 16. Any action taken under this Section 16 shall not relieve any
defaulting Initial Purchaser from liability in respect of any default of such
Initial Purchaser under this Agreement.

SECTION 17. No Advisory or Fiduciary Responsibility. Each of the Company and the
Guarantors acknowledges and agrees that: (i) the purchase and sale of the
Securities pursuant to this Agreement, including the determination of the
offering price of the Securities and any related discounts and commissions, is
an arm’s-length commercial transaction between the Company and the Guarantors,
on the one hand, and the several Initial Purchasers, on the other hand, and the
Company and the Guarantors are capable of evaluating and understanding and
understand and accept the terms, risks and conditions of the transactions
contemplated by this Agreement; (ii) in connection with each transaction
contemplated hereby and the process leading to such transaction each Initial
Purchaser is and has been acting solely as a principal and is not the agent or
fiduciary of the Company, Guarantors or their respective affiliates,
stockholders, creditors or employees or any other party; (iii) no Initial
Purchaser has assumed or will assume an advisory or fiduciary responsibility in
favor of the Company or Guarantors with respect to any of the transactions
contemplated hereby or the process leading thereto (irrespective of whether such
Initial Purchaser has advised or is currently advising the Company Guarantors on
other matters) or any other obligation to the Company and the Guarantors except
the obligations expressly set forth in this Agreement; (iv) the several Initial
Purchasers and their respective affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of the Company and
the Guarantors and that the several Initial Purchasers have no obligation to
disclose any of such interests by virtue of any fiduciary or advisory
relationship; and (v) the Initial Purchasers have not provided any legal,
accounting, regulatory or tax advice

 

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with respect to the offering contemplated hereby and the Company and the
Guarantors have consulted their own legal, accounting, regulatory and tax
advisors to the extent they deemed appropriate.

This Agreement supersedes all prior agreements and understandings (whether
written or oral) between the Company, the Guarantors and the several Initial
Purchasers, or any of them, with respect to the subject matter hereof. The
Company and the Guarantors hereby waive and release, to the fullest extent
permitted by law, any claims that the Company and the Guarantors may have
against the several Initial Purchasers with respect to any breach or alleged
breach of fiduciary duty.

SECTION 18. General Provisions. This Agreement constitutes the entire agreement
of the parties to this Agreement and supersedes all prior written or oral and
all contemporaneous oral agreements, understandings and negotiations with
respect to the subject matter hereof. This Agreement may be executed in two or
more counterparts, each one of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument. This
Agreement may not be amended or modified unless in writing by all of the parties
hereto, and no condition herein (express or implied) may be waived unless waived
in writing by each party whom the condition is meant to benefit. The section
headings herein are for the convenience of the parties only and shall not affect
the construction or interpretation of this Agreement.

 

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If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to the Company the enclosed copies hereof, whereupon this
instrument, along with all counterparts hereof, shall become a binding agreement
in accordance with its terms.

 

Very truly yours, SANDRIDGE ENERGY, INC. By:  

/s/ Tom L. Ward

  Name:   Tom L. Ward   Title:   Chief Executive Officer, President and Chairman
of the Board

 

SANDRIDGE ONSHORE, LLC

LARIAT SERVICES, INC.

SANDRIDGE OPERATING COMPANY

INTEGRA ENERGY, L.L.C.

SANDRIDGE EXPLORATION AND PRODUCTION, LLC

SANDRIDGE TERTIARY, LLC

SANDRIDGE MIDSTREAM, INC.

SANDRIDGE OFFSHORE, LLC

SANDRIDGE HOLDINGS, INC

By:  

/s/ Tom L. Ward

  Name:   Tom L. Ward   Title:   Chief Executive Officer

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

The foregoing Purchase Agreement is hereby confirmed and accepted by the Initial
Purchasers as of the date first above written.

 

RBC CAPITAL MARKETS, LLC

BARCLAYS CAPITAL INC.

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

MITSUBISHI UFJ SECURITIES (USA), INC.

WELLS FARGO SECURITIES, LLC

  Acting on behalf of themselves and as the Representatives of the several
Initial Purchasers RBC CAPITAL MARKETS, LLC By:  

/s/ Rick Brice

  Name:   Rick Brice   Title:   Managing Director BARCLAYS CAPITAL INC. By:  

/s/ Timothy N. Hartzell

  Name:   Timothy N. Hartzell   Title:   Managing Director

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

By:  

/s/ J. Lex Maultsby

  Name:   J. Lex Maultsby   Title:   Managing Director MITSUBISHI UFJ SECURITIES
(USA), INC. By:  

/s/ Brian Cogliandro

  Name:   Brian Cogliandro   Title:   Managing Director,     Head of U.S.
Syndicate WELLS FARGO SECURITIES, LLC By:  

/s/ Jeff Gore

  Name:   Jeff Gore   Title:   Managing Director

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SCHEDULE A

 

Initial Purchasers

   Aggregate Principal
Amount of Notes to
be Purchased  

RBC Capital Markets, LLC

   $ 225,000,000   

Barclays Capital Inc.

     105,750,000   

Merrill Lynch, Pierce, Fenner & Smith Incorporated

     105,750,000   

Mitsubishi UFJ Securities (USA), Inc.

     105,750,000   

Wells Fargo Securities, LLC

     105,750,000   

BNP Paribas Securities Corp.

     36,000,000   

Capital One Southcoast, Inc.

     36,000,000   

Credit Agricole Securities (USA) Inc.

     36,000,000   

RBS Securities Inc.

     36,000,000   

UBS Securities LLC

     36,000,000   

BBVA Securities Inc.

     18,000,000   

BOSC, Inc.

     18,000,000   

Comerica Securities, Inc.

     18,000,000   

KeyBanc Capital Markets Inc.

     18,000,000   

Total

   $ 900,000,000   

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SCHEDULE B

 

Subsidiary

   SandRidge
Ownership
Interest  

Cholla Pipeline, L.P.

     98.7143 % 

Sagebrush Pipeline, LLC

     73.80881 % 

In addition, SandRidge owns 50% of the membership interests of Grey Ranch Plant
Genpar, LLC and 50% of the partnership interests of Grey Ranch Plant, L.P.
Neither of these entities are “Subsidiaries” within the meaning of the Credit
Facility or the indentures governing the Company’s outstanding senior notes.

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EXHIBIT A-1

FORM OF OPINION OF ISSUER’S COUNSEL

Opinion of outside counsel to the Company to be delivered pursuant to Section 5
of the Purchase Agreement.

(i) The Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware.

(ii) The Company and each Delaware Guarantor has duly authorized, executed and
delivered the Purchase Agreement.

(iii) The Company and each Delaware Guarantor have duly authorized, executed and
delivered each of the Indenture and the Registration Rights Agreement, and each
of the Indenture and the Registration Rights Agreement constitutes the valid and
binding obligation of the Company and each Guarantor, enforceable against the
Company and each Guarantor in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and other laws of
general applicability relating to or affecting creditors’ rights and to general
equity principles.

(iv) The Company has duly authorized, executed and delivered the Notes, and,
assuming the Trustee has duly authenticated the Notes, each of the Notes
constitutes the valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles.

(v) Each Delaware Guarantor has duly authorized the Guarantees. Assuming the
Trustee has duly authenticated the Notes, each of the Guarantees constitutes the
valid and binding obligation of each Guarantor, enforceable against such
Guarantor in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles. In giving this opinion, such counsel need not express any opinion as
to the existence or adequacy of consideration received by the Guarantors for the
Guarantees.

(vi) The Notes, the Guarantees and the Indenture conform in all material
respects as to legal matters to the descriptions thereof contained in the
Pricing Disclosure Package and the Final Offering Memorandum.

(vii) The statements in the Final Offering Memorandum under the caption “Certain
United States Federal Income Tax Considerations,” insofar as such statements
constitute summaries of the laws, regulations, legal matters, agreements or
other legal documents referred to therein, are accurate in all material respects
and fairly summarize the matters referred to therein.

 

Exhibit A-1-1

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(viii) The execution and delivery of the Purchase Agreement, the Registration
Rights Agreement, the Notes and the Indenture by the Company and each Guarantor
party thereto, and the consummation by the Company and each Guarantor of the
transactions contemplated thereby in accordance with the terms thereof do not
(i) breach the provisions of the Company’s Amended and Restated Certificate of
Incorporation or Amended and Restated Bylaws or the certificate of
incorporation, bylaws, or other constitutive document of any of the Guarantors;
(ii) breach the provisions of, or cause a default or a Debt Repayment Triggering
Event under, the Amended and Restated Senior Credit Facility, dated April 22,
2010, by and among the Company and Bank of America, N.A., as Administrative
Agent, Swing Line Lender and L/C Issuer, and the other lenders party thereto, as
amended; (iii) breach the provisions of, or cause a default under, (a) the
Indenture, dated May 1, 2008, by and among the Company, certain subsidiary
guarantors named therein and Wells Fargo Bank, National Association, as trustee,
(b) the Indenture, dated May 20, 2008, by and among the Company, certain
subsidiary guarantors named therein and Wells Fargo Bank, National Association,
as trustee, (c) the Indenture, dated May 14, 2009, by and among the Company,
certain subsidiary guarantors named therein and Wells Fargo Bank, National
Association, as trustee or (d) the Indenture, dated December 16, 2009, by and
among the Company, certain subsidiary guarantors named therein and Wells Fargo
Bank, National Association, as trustee; or (iv) violate the General Corporation
Law of the State of Delaware or any New York or Federal statute, law, rule or
regulation known to us to which the Company or any Guarantor is subject;
provided however, such counsel need not express any opinion in this paragraph
(viii) with respect to state securities or blue sky laws, rules or regulations
or any state or Federal anti-fraud statute, rule or regulation.

(ix) The Company is not and, after giving effect to the offering and sale of the
Notes and the application of the proceeds thereof as described in the Final
Offering Memorandum, will not be an “investment company,” as defined in the
Investment Company Act of 1940, as amended.

(x) Based upon and assuming the accuracy of the representations and warranties
in the Purchase Agreement, the compliance with the conditions and covenants in
the Purchase Agreement, and the compliance with the procedures set forth in the
Final Offering Memorandum, it is not necessary in connection with (a) the
issuance and sale to the Initial Purchasers of the Notes pursuant to the
Purchase Agreement or (b) the initial resale of the Notes by the Initial
Purchasers in the manner contemplated by the Purchase Agreement and the Final
Offering Memorandum pursuant to Rule 144A under the Securities Act of 1933 (the
“Securities Act”), to register the Notes under the Securities Act or to qualify
an indenture under the Trust Indenture Act of 1939.

In addition, such counsel shall state that, as counsel to the Company, they have
reviewed the Pricing Disclosure Package and the Final Offering Memorandum and
have participated in discussions with representatives of the Company, the
Company’s accountants, and with representatives of the Initial Purchasers and
their counsel, and that, on the basis of the information which such counsel
reviewed in the performance of the services referred to above, considered in the
light of such counsel’s understanding of the applicable law and the experience
such counsel has gained through its practice under the Federal securities laws,
nothing which came to such counsel’s attention in the course of such review has
caused such counsel to believe

 

Exhibit A-1-2

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that: (a) the Pricing Disclosure Package, as of the Time of Sale (as specified
in the Purchase Agreement), contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading; or
(b) the Final Offering Memorandum, as of its date or as of the Closing Date,
contained or contains any untrue statement of a material fact or omitted or
omits to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except that in each case such counsel need not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the Pricing
Disclosure Package or the Final Offering Memorandum, except as specified in
Paragraphs (vi) and (vii) above. Also, such counsel need not express any opinion
or belief as to the financial statements, including the notes thereto, and the
financial statement schedules and other financial data and the oil and gas
reserve and production data included in the Pricing Disclosure Package or the
Final Offering Memorandum.

In rendering such opinion, such counsel may rely as to matters involving the
application of laws of any jurisdiction other than the General Corporation Law
of the State of Delaware, the contract laws of the State of New York or the
federal law of the United States, to the extent they deem proper and specified
in such opinion, upon the opinion (which shall be dated the Closing Date and
shall be satisfactory in form and substance to the Initial Purchasers, shall
expressly state that the Initial Purchasers may rely on such opinion as if it
were addressed to them and shall be furnished to the Initial Purchasers) of
other counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Initial Purchasers.

 

Exhibit A-1-3

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EXHIBIT A-2

FORM OF OPINION OF COMPANY’S COUNSEL

Opinion of counsel for the Company to be delivered pursuant to Section 5 of the
Purchase Agreement.

(i) The Company has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Pricing Disclosure
Package and the Final Offering Memorandum and to enter into and perform its
obligations under the Purchase Agreement, the Registration Rights Agreement, the
Indenture and the Notes.

(ii) The Company is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except for such jurisdictions where the failure to so
qualify or to be in good standing would not, singly or in the aggregate, have a
Material Adverse Effect.

(iii) Each Guarantor has been duly incorporated or formed, as applicable, and is
validly existing as a corporation or limited liability company, as applicable,
in good standing under the laws of the jurisdiction of its incorporation or
formation, as applicable, has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the Pricing
Disclosure Package and the Final Offering Memorandum and, to the best knowledge
of such counsel, is duly qualified as a foreign corporation or limited liability
company, as applicable, to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except for such
jurisdictions where the failure to so qualify or to be in good standing would
not, individually or in the aggregate, have a Material Adverse Effect.

(iv) The Company and each subsidiary possess such valid and current
certificates, authorizations or permits issued by the appropriate state, federal
or foreign regulatory agencies or bodies necessary to conduct their respective
businesses, and, to such counsel’s knowledge, neither the Company nor any
subsidiary has received any notice of proceedings relating to the revocation or
modification of, or non-compliance with, any such certificate, authorization or
permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could have a Material Adverse Effect.

(v) After due inquiry, such counsel does not know of any legal or governmental
actions, suits or proceedings pending or, to the best of such counsel’s
knowledge, threatened (i) against or affecting the Company or any of its
subsidiaries, (ii) which has as the subject thereof any officer or director of,
or property owned or leased by, the Company or any of its subsidiaries or
(iii) relating to environmental or discrimination matters, where in any such
case (A) there is a reasonable possibility that such action, suit or proceeding
might be determined adversely to the Company or such subsidiary and (B) any such
action, suit or proceeding, if so determined adversely, would reasonably be
expected to, singly or in the aggregate, have a Material Adverse Effect or
adversely affect the consummation of the transactions contemplated

 

Exhibit A-3-1

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by this Agreement. After due inquiry, such counsel does not know of any existing
or, to the best of such counsel’s knowledge, threatened or pending, material
labor dispute with the employees of the Company or any of its subsidiaries.

(vi) To the best knowledge of such counsel, neither the Company nor any
subsidiary is in violation of its charter, bylaws or other organizational
document, as the case may be.

In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the General Corporation Law
of the State of Delaware, the Delaware Limited Liability Company Act, the laws
of the State of Texas, or the federal law of the United States, to the extent
they deem proper and specified in such opinion, upon the opinion (which shall be
dated the Closing Date, shall be satisfactory in form and substance to the
Initial Purchasers, shall expressly state that the Initial Purchasers may rely
on such opinion as if it were addressed to them and shall be furnished to the
Initial Purchasers) of other counsel of good standing whom they believe to be
reliable and who are satisfactory to counsel for the Initial Purchasers.

 

Exhibit A-1-2

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EXHIBIT B-1

FORM OF ENGINEER COMFORT LETTER

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EXHIBIT B-2

FORM OF ENGINEER COMFORT LETTER

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EXHIBIT C

PRICING SUPPLEMENT

 

PRICING SUPPLEMENT   STRICTLY CONFIDENTIAL

LOGO [g158521ex10_1pg040.jpg]

SandRidge Energy, Inc.

March 2, 2011

 

 

This Pricing Supplement is qualified in its entirety by reference to the
Preliminary Offering Memorandum dated March 2, 2011. The information in this
Pricing Supplement supplements 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.

The Notes have not been registered under the Securities Act of 1933, as amended
(the “Securities Act”), and are being offered only to qualified institutional
buyers pursuant to Rule 144A under the Securities Act and outside the United
States to non-U.S. persons in accordance with Regulation S under the Securities
Act.

 

Terms Applicable to the 7.500% Senior Notes due 2021 Issuer:    SandRidge
Energy, Inc. Principal Amount:    $900,000,000 Gross Proceeds:    $900,000,000
Title of Securities:    7.500% Senior Notes due 2021 (the “Notes”) Final
Maturity Date:    March 15, 2021 Issue Price:    100.0%, plus accrued interest,
if any, from March 15, 2011 Coupon:    7.500% Yield to Maturity:    7.500%
Spread to Benchmark Treasury:    +405 bps Benchmark Treasury:    UST 3.625% due
February 15, 2021 Interest Payment Dates:    March 15 and September 15,
beginning on September 15, 2011

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

Record Dates:    March 1 and September 1 Ratings:    Moody’s: B3     S&P: B    A
securities rating is not a recommendation to buy, sell or hold securities and
may be subject to revision or withdrawal at any time. Optional Redemption:    On
and after, March 15, 2016, in whole or in part, at the prices set forth below
(expressed as percentages of the principal amount), plus accrued and unpaid
interest, if any, to the date of redemption, on March 15 of the years set forth
below:      

Date

  

Price

        

2016

2017

2018

2019 and thereafter

  

103.750%

102.500%

101.250%

100.000%

      Make-whole call at T + 50 bps until March 15, 2016. Optional Redemption
with Equity Proceeds:    In addition, prior to March 15, 2014, up to 35% at a
redemption price equal to 107.500% of the aggregate principal amount thereof,
plus accrued and unpaid interest thereon, if any, to the date of redemption.
Change of Control:    Putable at 101% of principal, plus accrued and unpaid
interest to the date of purchase. Initial Purchasers:   

Joint Book-Running Managers:

RBC Capital Markets, LLC

Barclays Capital Inc.

Merrill Lynch, Pierce, Fenner & Smith Incorporated

Mitsubishi UFJ Securities (USA), Inc.

Wells Fargo Securities, LLC

 

Senior Co-Managers:

BNP Paribas Securities Corp.

Capital One Southcoast, Inc.

Credit Agricole Securities (USA) Inc.

RBS Securities Inc.

UBS Securities LLC

 

Co-Managers:

BBVA Securities Inc.

BOSC, Inc.

Comerica Securities, Inc.

KeyBanc Capital Markets Inc.

 

Exhibit A-1-2

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Trade Date:    March 2, 2011 Settlement Date:    T+9 on March 15, 2011
Denominations:    $1,000 and integral multiples of $1,000 in excess thereof
Distribution:    144A/Regulation S with Registration Rights as set forth in the
Preliminary Offering Memorandum CUSIPS and ISIN Numbers:   

144A Notes:

CUSIP: 80007P AM1

ISIN: US80007PAM14

  

Reg S Notes:

CUSIP: U79864 AD3

ISIN: USU79864AD31

  

Other Information:

The following changes will be made in the Preliminary Offering Memorandum:

Use of Proceeds:

The following disclosure under “Use of Proceeds” on page 17 and each other
location where it appears in the Preliminary Offering Memorandum is amended to
read as follows:

We estimate that the net proceeds from this offering will be approximately
$881.0 million after deducting the initial purchasers’ discounts and our
estimated expenses. We will use the net proceeds from this offering to fund the
aggregate tender price of our tender offer for up to $650.0 million in aggregate
principal amount of our 8.625% Senior Notes due 2015 (including payment of the
accrued but unpaid interest on such notes in connection with the tender offer),
and for general corporate purposes, including to repay borrowings outstanding
under our senior credit facility. To the extent that any 2015 notes are not
tendered or in the event our tender offer is not consummated, any remaining net
proceeds will be used for general corporate purposes, including to repay
borrowings outstanding under our senior credit facility. We may also redeem or
purchase any of the 8.625% Senior Notes due 2015 that are not tendered and
purchased in our tender offer using remaining net proceeds from this offering
(if any), cash on hand or borrowings under our senior credit facility. Our
senior credit facility had a balance of $460.0 million as of February 28, 2011,
and matures in April 2014. The average interest rate paid on amounts outstanding
under our senior credit facility for the year ended December 31, 2010 was 2.70%.
As a result of this offering, the borrowing base for our senior credit facility
will be automatically reduced by approximately $60 million, or 30% of the
principal amount of the notes in excess of the amount used to purchase or redeem
the 8.625% Senior Notes due 2015. After giving effect to this offering, the
borrowing base will be approximately $790 million.

 

 

Other information (including financial information) presented in the Preliminary
Offering Memorandum is deemed to have changed to the extent affected by the
changes described herein.

 

Exhibit A-1-3

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This material is confidential and is for your information only and is not
intended to be used by anyone other than you. This information does not purport
to be a complete description of these Notes or the offering. Please refer to the
Preliminary Offering Memorandum for a complete description.

Any disclaimers or other notices that may appear below are not applicable to
this communication and should be disregarded. Such disclaimers or other notices
were automatically generated as a result of this communication being sent via
Bloomberg email or another communication system.

 

Exhibit A-1-4

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ANNEX I

Resale Pursuant to Regulation S or Rule 144A. Each Initial Purchaser understands
that:

Such Initial Purchaser agrees that it has not offered or sold and will not offer
or sell the Securities in the United States or to, or for the benefit or account
of, a U.S. Person (other than a distributor), in each case, as defined in
Rule 902 of Regulation S (i) as part of its distribution at any time and
(ii) otherwise until 40 days after the later of the commencement of the offering
of the Securities pursuant hereto and the Closing Date, other than in accordance
with Regulation S or another exemption from the registration requirements of the
Securities Act. Such Initial Purchaser agrees that, during such 40-day
restricted period, it will not cause any advertisement with respect to the
Securities (including any “tombstone” advertisement) to be published in any
newspaper or periodical or posted in any public place and will not issue any
circular relating to the Securities, except such advertisements as are permitted
by and include the statements required by Regulation S.

Such Initial Purchaser agrees that, at or prior to confirmation of a sale of
Securities by it to any distributor, dealer or person receiving a selling
concession, fee or other remuneration during the 40-day restricted period
referred to in Rule 903 of Regulation S, it will send to such distributor,
dealer or person receiving a selling concession, fee or other remuneration 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 and sold within the United States or to, or for the account or benefit
of, U.S. persons (i) as part of your distribution at any time or (ii) otherwise
until 40 days after the later of the date the Securities were first offered to
persons other than distributors in reliance upon Regulation S and the Closing
Date, except in either case in accordance with Regulation S under the Securities
Act (or in accordance with Rule 144A under the Securities Act or to accredited
investors in transactions that are exempt from the registration requirements of
the Securities Act), and in connection with any subsequent sale by you of the
Securities covered hereby in reliance on Regulation S under the Securities Act
during the period referred to above to any distributor, dealer or person
receiving a selling concession, fee or other remuneration, you must deliver a
notice to substantially the foregoing effect. Terms used above have the meanings
assigned to them in Regulation S under the Securities Act.”