Exhibit 10.25

PURCHASE AND SALE AGREEMENT

This Purchase and Sale Agreement (as may be amended, restated, supplemented or
otherwise modified from time to time, this “Agreement”) is dated as of
January 25, 2017 (the “Execution Date”), by and between PRIMEENERGY CORPORATION,
a Delaware corporation, PRIMEENERGY MANAGEMENT CORPORATION, a New York
corporation, PRIMEENERGY ASSET AND INCOME FUND, L.P. A-2, a Delaware limited
Partnership, PRIMEENERGY ASSET AND INCOME FUND, L.P. A-3, a Delaware limited
Partnership, PRIMEENERGY ASSET AND INCOME FUND, L.P. AA-2, a Delaware limited
Partnership, PRIMEENERGY ASSET AND INCOME FUND, L.P. AA-4, a Delaware limited
Partnership, PRIME OPERATING COMPANY, a Texas limited liability company
(“Seller”), on the one part, and GUIDON OPERATING LLC, a Delaware limited
liability company (“Purchaser”), on the other part. Seller and Purchaser are
sometimes referred to herein individually as a “Party” and collectively as the
“Parties.”

RECITALS

WHEREAS, Seller is willing to sell to Purchaser, and Purchaser is willing to
purchase from Seller, the Assets (as defined below), upon the terms and
conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the mutual benefits derived and to be
derived from this Agreement by each Party, Seller and Purchaser agree as
follows:

1. Purchase and Sale. Upon the terms and subject to the conditions of this
Agreement, Seller agrees to sell, transfer, convey, and assign the Assets to
Purchaser and Purchaser agrees to purchase, accept, and pay for the Assets.

2. Assets. As used herein, the term “Assets” refers to all of Seller’s right,
title and interest in and to the following:

(a) all oil and gas leases covering any of the lands described on Exhibit A (the
“Lands”), together with such surface and subsurface rights described therein,
all overriding royalty interests, nonparticipating royalties, reversionary
interests, carried interests, options, convertible interests, net profits
interests and other similar interest and rights related thereto (the “Leases”)
the wellbore of the Rusty Nail #1HB well, API # 42-317-40375 (the “Well,” and
together with the Lands and Leases, the “Properties”), including the Leases and
Wells described on Exhibit A, but excluding the Excluded Wellbores;

(b) the personal property, equipment, fixtures and improvements located on or
used or held in connection with the Leases and Lands or used or held in
connection with the Production (as defined below) attributable to the Leases,
Lands or Well, including well pads, machinery, fixtures, tubulars, gathering
systems, flow lines, pipelines, tank batteries, and other inventory attributable
to the any of the Properties; but excluding all such items used in connection
with Excluded Wellbores (the “Equipment”);

(c) all rights and obligations existing under any contracts, agreements and
instruments which relate, but only insofar as they relate, to the Properties
(the “Contracts”), including, but not limited to, operating agreements, farmout
agreements, rights of way, easements, servitudes, licenses, permits, surface
leases, rights-of-way, surface use agreements, production sales and purchase
contracts, oil gathering contracts, gas gathering and transportation contracts,
gas processing contracts, saltwater disposal agreements; but excluding all
interests in such Contracts as they apply to the Excluded Wellbores, provided,
however, (i) Seller shall have a concurrent right to use any rights of way,
easements, servitudes, licenses, permits, surface leases, rights-of-way, surface
use agreements for use of existing facilities in connection with the Excluded
Wellbores, and shall be responsible for all costs and expenses related thereto;
and (ii) the term “Contracts” shall not include the Leases or other instruments
constituting Seller’s chain of title to the Leases;

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(d) the oil, gas, casinghead gas, condensate, distillate, liquid hydrocarbons,
gaseous hydrocarbons, products refined and manufactured therefrom or
attributable thereto, and other minerals and the accounts and proceeds from the
sale of all of the foregoing attributable to the Properties under the terms of
the Leases or Contracts (the “Production”) from and after the Effective Time,
but excluding that produced from the Excluded Wellbores;

(e) all trade credits, accounts receivable, notes receivable, take or pay
amounts receivable, insurance claims, and other receivables and general
intangibles attributable to the Assets from and after the Effective Time, but
excluding those attributable to the Excluded Wellbores; and

(f) all files, books, records (including tax records), data, documentation,
databases, maps, well logs and data, and muniments of title maintained by, or to
which Seller is entitled, including, without limitation, geophysical and seismic
data and other documentary information, regarding the Properties, the Contracts
and the Production to the extent the transfer of such data is not prohibited
under any related contracts (the “Data”); provided, however, that the term
“Data” shall not include any of Seller’s files, records, or data that (i) relate
to its business generally, (ii) are legal in nature (other than Leases,
Contracts, and title opinions), (iii) relate to bids received from or records
with respect to negotiations with, third parties pertaining to the sale of the
Assets, (iv) the transfer of which is prohibited by contract or law or that
would impose a transfer fee or penalty on Seller, and (v) relate to the Excluded
Assets (the “Excluded Records”). To the extent any of the Data contain
interpretations of Seller, Purchaser agrees to rely on such interpretations at
its own risk.

3. Excluded Assets. Notwithstanding anything to the contrary in Section 2 or
elsewhere in this Agreement, the “Assets” shall not include any rights with
respect to the Excluded Assets. “Excluded Assets” means the following:

(a) all accounts receivable accruing to the Assets prior to the Effective Time;

(b) any Production from, or attributable to, the Assets with respect to all
periods prior to the Effective Time, including, without limitation, all proceeds
attributable thereto;

(c) any refunds or additional revenues accruing to the Assets and any
adjustments for costs, expenses or taxes paid or borne by Seller, in each case,
to the extent such refunds or revenues are attributable to the period prior to
the Effective Time;

(d) except to the extent related to any Assumed Obligations, any and all
proceeds from settlements of contract disputes with purchasers of Production or
byproducts to the extent that such proceeds are attributable to periods of time
prior to the Effective Time;

(e) except to the extent related to any Assumed Obligations, any rights and
interests of Seller (i) under any policy or agreement of insurance or indemnity
(including, without limitation, any rights, claims or causes of action of Seller
against third parties under any indemnities or hold harmless agreements and any
indemnities received in connection with Seller’s prior acquisition of any of the
Assets), to the extent that such rights and interests relate to losses, damages,
claims, liabilities, debts, obligations or expenses arising out of, or in
connection with, the ownership of the Assets prior to the Effective Time and
(ii) under any bond;

(f) any of Seller’s computer software, patents, trade secrets, copyrights,
names, trademarks, logos and other intellectual property;

 

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(g) except to the extent related to any Assumed Obligations, all audit rights
arising under any of the Contracts or otherwise with respect to the Assets for
any period prior to the Effective Time or relating to any of the Excluded
Assets;

(h) except to the extent related to any Assumed Obligations, all claims of
Seller for refunds of or loss carry forwards with respect to (i) taxes on
Production or any other taxes attributable to any period prior to the Effective
Time, (ii) income or franchise taxes or (iii) any taxes attributable to the
Excluded Assets;

(i) any leased equipment and other leased personal property if such property, or
the contract pursuant to which it was leased, is (i) not freely transferrable
without payment of a fee or other consideration, unless Purchaser has agreed in
writing to pay such fee or consideration, or (ii) cancelable with no more than a
30-day notice requirement;

(j) Seller’s right, title and interest in and to the wellbores set forth on
Schedule 3 (the “Excluded Wellbores”) along with personal property, equipment,
fixtures and improvements located on or used or held in connection with the
Leases and Lands or used or held in connection with the Production attributable
to the Leases or Lands, including well pads, machinery, fixtures, tubulars,
gathering systems, flow lines, pipelines, tank batteries, and other inventory
attributable to any of the Excluded Wellbores;

(k) All pooling or unitization agreements or declarations of pooling or
unitization related to the Excluded Wellbores;

(l) All water, disposal or injection wells located on the Lands as of the
Effective Time; and

(m) the Excluded Records.

4. Purchase Price. The purchase price for the Assets shall be THIRTY MILLION
NINE HUNDRED FIFTY-FOUR THOUSAND FOUR HUNDRED EIGHTY-EIGHT AND 77/100 DOLLARS
($30,954,488.77) (the “Purchase Price”). The Purchase Price shall be adjusted as
provided in Section 5, and the determination of the Adjusted Purchase Price
shall be made as provided in Section 13.

5. Purchase Price Adjustments. Without limiting the foregoing, the Purchase
Price shall be adjusted as follows, without duplication, with the resulting
adjustments to such Purchase Price herein the “Adjusted Purchase Price”:
(i) upward by (A) any amounts agreed to by Seller and Purchaser; and
(ii) downward by (A) all unpaid ad valorem, property, and similar taxes and
assessments insofar as such unpaid taxes relate to periods prior to the
Effective Time, and (B) all Expenses attributable to the Assets allocated to any
period prior to the Effective Time that have been paid by Purchaser, (C) the
Allocated Value for any Lease for which a consent is required but not yet
obtained or subject to a preferable right not waived, and (D) and by any other
amounts agreed to by Seller and Purchaser. “Expenses” means all operating
expenses (including costs of insurance, rentals, shut-in payments, and overhead
costs) and capital expenditures (including bonuses, broker fees, and other Lease
acquisition costs, costs of drilling and completing wells, and costs of
acquiring equipment) incurred in the ownership and operation of the Assets in
the ordinary course of business, but excluding (without limitation) liabilities,
losses, costs, expenses, and damages attributable to: (i) claims,
investigations, administrative proceedings, arbitration or litigation directly
or indirectly arising out of or resulting from actual or claimed personal
injury, illness or death; property damage; environmental damage or
contamination; other torts; private rights of action given under any law; or
violation of any law; (ii) obligations to plug and/or abandon wells, dismantle,
decommission or remove facilities, clear sites, and/or restore the surface
around such wells or facilities; (iii) obligations to remediate any
contamination of groundwater, surface water, soil, sediments, or Equipment;
(iv) title and environmental claims; (v) claims of improper calculation or
payment of royalties; (vi) gas balancing and other production balancing
obligations; (vii) taxes; (viii) title and environmental curative actions; and
(ix) any claims for indemnification, contribution, or reimbursement from any
third party with respect to liabilities, losses, costs, and expenses of the type
described in preceding clauses (i) through (viii), whether such claims are made
pursuant to contract or otherwise.

 

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6. Allocated Values. The Purchase Price shall be allocated among the Assets as
set forth in Schedule 6 hereto (collectively, the “Allocated Values”). The
Parties agree to be bound by the Allocated Values set forth in Schedule 6 for
all purposes hereof. The Parties further agree that for the purpose of making
the requisite filings under Section 1060 of the Internal Revenue Code of 1986,
as amended (the “Code”), and the regulations thereunder, the Purchase Price and
any liabilities assumed by Purchaser under this Agreement that are treated as
consideration for tax purposes shall be allocated among the Assets in a manner
consistent with the Allocated Values, as set forth on Schedule 6 (the “Tax
Allocation”). The Parties each agree to report, and to cause their respective
affiliates (as applicable) to report, the federal, state, and local income and
other tax consequences of the transactions contemplated hereby, and in
particular, to report the information required by Section 1060(b) of the Code,
and to jointly prepare Form 8594 (Asset Acquisition Statement under Section 1060
of the Code) as promptly as possible following the Effective Time and in a
manner consistent with the Tax Allocation to take into account subsequent
adjustments to the Purchase Price, including any adjustments pursuant to this
Agreement, and shall not take any position inconsistent therewith upon
examination of any tax return, in any refund claim, in any litigation,
investigation or otherwise, unless required to do so by any laws after notice to
and discussions with the other Party, or with such other Party’s prior consent.

7. Effective Time. The sale of the Assets shall be effective as of 7:00 a.m. at
the location of the Properties on January 1, 2017 (the “Effective Time”).

8. Seller’s Representations. Each Seller (severally and not jointly) represents
and warrants to Purchaser as of the date hereof:

(a) Existence. Seller is duly formed, validly existing and in good standing
under the laws of its state of formation or incorporation, and has full legal
power, right and authority to carry on its business as such is now being
conducted and as contemplated to be conducted.

(b) Legal Power. Seller has the legal power and right to enter into and perform
this Agreement and the transactions it contemplates for Seller. The consummation
of the transactions contemplated by this Agreement will not violate, or be in
conflict with (i) any provision of Seller’s governing documents; or (ii) any
judgment, order, ruling or decree applicable to Seller as a party in interest or
any law applicable to Seller’s interest in any of the Assets, except (x) as
would not, individually or in the aggregate, have a material adverse effect, or
(y) as to rights to consent by, required notices to, filings with, approval or
authorizations of, or other actions by any governmental authorities where the
same are not required prior to the assignment of the related Asset, or which are
customarily obtained subsequent to the sale or conveyance thereof (“Customary
Post-Closing Consents”).

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

(d) Litigation. (a) No litigation, arbitration, demands, investigations or other
proceeding is pending or, to Seller’s knowledge, threatened against Seller, and,
to Seller’s knowledge, no litigation, arbitration, demands, investigation or
other proceeding is pending or threatened against the Properties,

 

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before any court, arbitrator or governmental authority; and (b) neither Seller,
its affiliates nor, to Seller’s knowledge any of the Properties is subject to
any outstanding injunction, judgment, order, decree or ruling relating to the
Properties. There is no litigation, proceeding or investigation pending, or to
Seller’s knowledge, threatened against or affecting Seller that questions the
validity or enforceability of this Agreement or any other document, instrument
or agreements to be executed and delivered by Seller in connection with the
transactions contemplated hereby.

(e) Contracts. (i) To the best of Seller’s knowledge, Seller is not in breach or
default in any material respect under any Contract. Seller has paid (or has
caused its representative to pay) all expenses of the Properties under the
Contracts, all Contracts are in full force and effect in all material respects,
and Seller has provided Purchaser with true, complete and correct copies of each
Contract.

(ii) Schedule 8(e)(ii) sets forth, to the best of Seller’s knowledge and belief,
all of the following Contracts, to which any of the Properties will be bound as
of the Closing: (a) any agreement or contract for the sale, exchange, or other
disposition of hydrocarbons produced from or attributable to Seller’s interest
in the Properties that is not cancelable without penalty or other material
payment on not more than 30 days prior written notice; (b) any agreement of or
binding upon Seller to sell, lease, farmout, or otherwise dispose of any
interest in any of the Properties after the date hereof, other than conventional
rights of reassignment arising in connection with Seller’s surrender or release
of any of the Properties; (c) any tax partnership agreement of or binding upon
Seller that would be binding upon Purchaser or any of the Properties after
Closing; (d) confidentiality agreements, areas of mutual interest or
non-competition agreements, favored nations agreements or any agreements that
purport to restrict, limit, or prohibit a person from engaging in any line of
business or the manner in which, or the locations at which, Seller (or
Purchaser, as successor in interest to Seller) conducts business; (e) contracts
for the gathering, treatment, processing, storage, or transportation of
hydrocarbons; (f) joint operating agreements, unit operating agreements, unit
agreements, or other similar agreements; (g) indentures, mortgages or deeds of
trust, loans, credit or note purchase agreements, sale-lease back agreements,
guaranties, bonds, letters of credit, or similar financial agreements; and
(h) other agreements, excluding the Leases, that could reasonably be expected to
result in (A) aggregate payments by Seller (net to the interest of Seller) of
more than $50,000 or (B) revenues (net to the interest of Seller) of more than
$50,000 during the current or any subsequent calendar year.

(f) Compliance with Laws; Permits. To the best of Seller’s knowledge, at all
times during Seller’s ownership of the Properties, the Properties have been
operated in material compliance with, all applicable laws. There exists no
continuing or uncured violation on the part of Seller or any of Seller’s
representatives of any license or permit which violation would singly or in the
aggregate, adversely affect in any material respect the ownership, operation or
value of the Properties.

(g) Environmental Laws. To the best of Seller’s knowledge, (i) (A) There is no
hazardous substance, contamination of groundwater, surface water, soil or
otherwise at, on under or from the Properties with respect to which material
remediation is presently required and (B) there has been no exposure of any
person to hazardous substances in connection with or relating to the Properties
or the ownership or operation thereof which could reasonably be expected to
result in material, uncured violation of or material, uncured liabilities under
applicable environmental laws; (ii) there are no actions, suits or proceedings
pending of which Seller has received service or written notice, or to Seller’s
knowledge, threatened, before any governmental authority or arbitrator with
respect to the Properties alleging material violations of, or material
liabilities under, environmental laws, or claiming material remediation
obligations; (iii) Seller has received no written notice from any governmental
authority of any alleged or actual material violation or non-compliance with, or
material liability under, any environmental law or of material non-compliance
with the terms or conditions of any environmental permits, arising from, based
upon, associated with or related to the Properties or the ownership or

 

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operation thereof that remains unresolved as of the date hereof; and (iv) Seller
has made available to Purchaser any site assessments, in each case, prepared by
third parties, relating to the Properties that are in the possession or control
of Seller and have been prepared with the five (5) years preceding the date
hereof.

(h) Wells. There are no inactive wells that Seller is currently obligated by
applicable law or contract to plug or abandon or that are currently subject to
exceptions to a requirement to plug or abandon issued by a governmental
authority.

(i) Consents and Preferential Purchase Rights. To the best of Seller’s
knowledge, except as set forth on Schedule 8(i) there are no consents or
preferential purchase rights that are applicable in connection with the
transactions contemplated by this Agreement.

(j) Liens and Encumbrances. To the best of Seller’s knowledge, except as
provided in the Contracts identified in Schedule 8(e)(ii), the Properties are
not subject to any claim, lien, mortgage, security interest, pledge, charge,
option, or encumbrance of any kind.

(k) No Operations. Except for the drilling of the Excluded Wellbores and the
Well, Seller has not conducted oil and gas exploration, development or
production operations on the Properties, or any lands pooled or unitized
therewith.

(l) Commitments or Proposals. (a) Seller has incurred no expenses, and has made
no commitments to make expenditures in connection with the ownership or
operation of the Properties after the Effective Date, and (b) no proposals are
currently outstanding by Seller or, to Seller’s knowledge, other working
interest owners to drill any well.

(m) Production Sales Contracts. There exist no agreements or arrangements for
the sale of Seller’s share of oil and gas produced from the Properties
(including calls on, or other rights to purchase, production, whether or not the
same are currently being exercised) other than (a) production sales contracts
disclosed in Schedule or (b) agreements or arrangements which are cancelable on
ninety (90) days notice or less without penalty or detriment.

(n) Payment of Expenses and Royalties; Leases. (i) To the best of Seller’s
knowledge, all expenses (including all bills for labor, materials and supplies
used or furnished for use in connection with the Properties, and all taxes)
relating to the ownership or operation by Seller of its interest in the
Properties, have been, and are being, paid (timely, and before the same become
delinquent) by Seller, except such expenses and taxes as are disputed in good
faith by Seller and set forth on Schedule 8(n)(i). Seller is not delinquent with
respect to its obligations to bear costs and expenses relating to the
development and operation of the Properties. To the best of Seller’s knowledge,
all royalties, overriding royalties, compensatory royalties and other payments
due from or in respect of production with respect to the Properties, have been
or will be, prior to the Closing, properly and correctly paid. (ii) To the best
of Seller’s knowledge, all Leases have been maintained in according to their
terms, in compliance with the agreements to which the Leases are subject, are
presently in full force and effect, and there has not occurred any event, fact
or circumstance which, with the lapse of time or the giving of notice, or both,
would constitute such a breach or default of the Leases on behalf of the Seller
or with respect to any other parties, and Seller has not received a notice from
a lessor or other third party that Seller is in default of any such Lease.

(o) Commitments or Proposals. (a) Seller has incurred no expenses, and has made
no commitments to make expenditures in connection with the ownership or
operation of the Properties after the Effective Date, other than routine
expenses incurred in the normal operation of the Excluded Wellbores; and (b) no
proposals are currently outstanding by Seller or, to Seller’s knowledge, other
working interest owners to drill additional wells on the Properties, or to
deepen, plug back, or rework any Excluded Wellbores, or to abandon any Excluded
Wellbore.

 

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(p) Hedging Transactions. There are no outstanding hedging transactions
applicable to the Properties.

(q) Broker’s Fees. No broker or finder is entitled to any brokerage or finder’s
fee, or to any commission, based in any way on agreements, arrangements or
understandings made by or on behalf of Seller for which Purchaser has or will
have any liabilities or obligations (contingent or otherwise).

(r) Taxes. All ad valorem, property, production, severance, excise and similar
taxes based upon or measured by the ownership of any of the Properties that have
become due and payable during the period prior to the Effective Time have been
timely and properly paid.

(s) Suspense Funds. No third party funds or other proceeds of production
attributable to the Properties are held in suspense by Seller or by the
applicable operator of the Wells.

(t) Non-Consent Operations. Except as to the Well, no operations are being
conducted or have been conducted on the Properties with respect to which Seller
has elected to be a non-consenting party under the applicable governing
agreement and with respect to which all of Seller’s rights have not yet reverted
to it.

(u) Bankruptcy. There are no bankruptcy, reorganization or arrangement
proceedings pending, being contemplated by or, to Seller’s knowledge, threatened
against Seller.

9. Purchaser’s Representations. Purchaser represents and warrants to Seller as
of the date hereof:

(a) Purchaser’s Existence. Purchaser is duly formed, validly existing and in
good standing under the laws of the State of Delaware, and has full legal power,
right and authority to carry on its business as such is now being conducted and
as contemplated to be conducted.

(b) Legal Power. Purchaser has the legal power and right to enter into and
perform this Agreement and the transactions it contemplates for Purchaser. The
consummation of the transactions contemplated by this Agreement will not
violate, or be in conflict with (i) any provision of Purchaser’s governing
documents; or (ii) any judgment, order, ruling or decree applicable to Purchaser
as a party in interest or any law applicable to Purchaser’s interest in any of
the Assets after the transfer hereunder, except (x) as would not, individually
or in the aggregate, have a material adverse effect, or (y) as to Customary
Post-Closing Consents.

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

(d) Independent Investigation. Purchaser has been afforded an opportunity to
(i) examine the Assets, including the Data, and such materials and documents
as it has requested to be provided to it by Seller, (ii) discuss with
representatives of Seller such materials and the nature and operation of the
Assets and (iii) investigate the condition of the Properties and Contracts. In
entering into this Agreement,

 

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Purchaser has relied solely on the express representations and covenants of
Seller in this Agreement, its independent investigation of, and judgment with
respect to, the Equipment and the other Assets and the advice of its own legal,
tax, economic, environmental, engineering, geological and geophysical advisors
and not on any comments or statements of any representatives of, or consultants
or advisors engaged by, Seller.

(e) Litigation. There is no litigation, proceeding or investigation pending, or
to Purchaser’s knowledge, threatened against or affecting Purchaser that
questions the validity or enforceability of this Agreement or any other
document, instrument or agreements to be executed and delivered by Purchaser in
connection with the transactions contemplated hereby.

(f) Broker’s Fees. No broker or finder is entitled to any brokerage or finder’s
fee, or to any commission, based in any way on agreements, arrangements or
understandings made by or on behalf of Purchaser for which Seller has or will
have any liabilities or obligations (contingent or otherwise).

(g) Bankruptcy. There are no bankruptcy, reorganization or arrangement
proceedings pending, being contemplated by or, to Purchaser’s knowledge,
threatened against Purchaser

(h) Qualifications. As of the Execution Date, Purchaser is qualified to own and
assume operatorship (or to continue operatorship) of the Properties, and the
consummation of the transactions contemplated by this Agreement will not cause
Purchaser to be disqualified as such owner or operator. Prior to the Execution
Date, Purchaser has obtained and will maintain in effect, lease bonds and any
other surety bonds as may be required by, and in accordance with, all applicable
laws governing the ownership and operation of the Properties. Purchaser will
file any and all required reports necessary for the aforementioned operations
with all governmental authorities having jurisdiction over such operations. To
Purchaser’s knowledge, there are no matters or circumstances applicable to
Purchaser that would preclude or inhibit unconditional approval by governmental
authorities of the assignment of the Properties from the Seller to Purchaser.

(i) Financing. As of the Execution Date, Purchaser has sufficient cash,
available lines of credit or other sources of immediately available funds (in
United States dollars) to enable Purchaser to pay the Adjusted Purchase Price to
the Seller on the Execution Date and to pay all expenses incurred by Purchaser
in connection with this Agreement and the transactions contemplated hereby.

(j) Investment. Purchaser is an experienced and knowledgeable investor in the
oil and gas business. Prior to entering into this Agreement, Purchaser was
advised by and has relied solely on its own legal, tax and other professional
counsel concerning this Agreement, the Assets and the value thereof. In making
the decision to enter into this Agreement and consummate the transactions
contemplated hereby, Purchaser has relied solely on the basis of its own
independent valuation and due diligence investigation of the Assets.

10. Closing.

(a) Consummation of the purchase and sale transaction as contemplated by this
Agreement (the “Closing”) shall occur contemporaneously with the execution of
this Agreement and shall be conditioned upon the following:

(i) The Parties shall execute and deliver an assignment in the form of the
Assignment and Bill of Sale attached hereto as Exhibit B (the “Assignment and
Bill of Sale”) for the conveyance of the Assets from Seller to Purchaser., save
and except any Leases identified on Schedule 8(i) upon which consents and/or
preferential right waivers have yet to be obtained. For the avoidance of doubt,
at Closing Seller will deliver and receive consideration for (i) those Leases
not subject to any consent or preferential right, (ii) those Leases subject to a
consent that has been obtained or waived, (iii) those Leases subject to a
preferential right that has been waived, or (iv) those Leases subject to a
consent or preferential right requirement that has been waived by Purchaser.

 

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(ii) Purchaser shall deliver to Seller in immediately available funds and
pursuant to any wiring instructions provided by Seller an amount equal to the
Purchase Price less any amounts withheld because of the failure to obtain a
consent or waiver of a preferential right. Each Seller appoints Prime Operating
Company to receive all payments of the Purchase Price, and shall hold Purchaser
harmless from any claim for payments so delivered. Prime Operating Company shall
deliver to each Seller its allocated share of the Purchase Price.

(iii) Seller shall deliver a certificate of non-foreign status in form and
substance satisfactory to Purchaser.

(iv) The Parties shall deliver such additional documents as are customary in
similar transactions as might be reasonably requested by the other Party.

(b) Closing shall occur on or before January 23, 2017. Should Closing fail to
occur by January 25, 2017, this Agreement shall terminate and will be of no
further force and effect.

(c) After Closing, if, as and when consents to assign or waivers of a
preferential right in form and substance satisfactory to Purchaser are obtained
as to a Lease identified on Schedule 8(i), Purchaser shall pay to Seller the
Allocated Value attributable to such Lease. Leases for which consents or waivers
of a preferential right have not been obtained within thirty (30) days following
Closing shall be excluded from this Agreement, unless Purchaser waives obtaining
consent or waiver. Likewise, if, as and when consents to assign or waivers of
preferential rights are obtained, Seller shall, upon delivery of consideration
allocated to the affected Lease(s), provide an additional assignment of said
Lease(s) to Purchaser, in the same form as Exhibit B.

11. Allocation of Expenses and Revenues. Seller shall be entitled to all amounts
realized from and accruing to the Assets prior to the Effective Time including
the right to all Production, storage, processing and inventory and shall be
responsible for all Expenses for the ownership, development and operation of the
Assets prior to the Effective Time. Purchaser shall be entitled to any amounts
realized from and accruing to the Assets on or after the Effective Time and
shall be responsible for all Expenses for the ownership, development and
operation of the Assets on or after the Effective Time.

12. Taxes. Severance and other production taxes attributable to the Production
shall be the obligation of the Party entitled to such Production. All other
property taxes and ad valorem taxes assessed against the Properties shall be
prorated between Seller and Purchaser as of the Effective Time if and as paid,
whether before or after the post-closing accounting (as set forth in Section 13)

13. Post-Closing Accounting. A post-Closing accounting shall be held no later
than ninety (90) days after the date hereof. The Final Settlement Statement
shall be prepared by Purchaser and approved by both Parties. Such account shall
be settled between the Parties by the payment of cash, as appropriate, pursuant
to a final settlement statement setting forth any adjustments to the Purchase
Price made in accordance with Section 5 and taking into account any payments
related to such matters made as of the date hereof (the “Final Settlement
Statement”).

14. Survival. All of the covenants, agreements, representations and warranties
(other than the Fundamental Representations) made by the Parties in this
Agreement shall survive the Closing, in each case, for a period of 12 months,
and they shall not be merged into or superseded by the Assignment and Bill of
Sale or other documents delivered hereunder. The representations and warranties
set forth in Sections 8(a), 8(b), 8(c), 8(q), 9(a), 9(b), 9(c) and 9(f) (the
“Fundamental Representations”) shall survive the Closing indefinitely, and they
shall not be merged into or superseded by the Assignment and Bill of Sale or
other documents delivered hereunder.

 

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15. Disclaimers. OTHER THAN THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS
AGREEMENT AND IN THE ASSIGNMENT AND BILL OF SALE, SELLER MAKES NO, AND EXPRESSLY
DISCLAIMS, ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO (I) TITLE
TO ANY OF THE ASSETS, (II) THE CONTENTS, CHARACTER OR NATURE OF ANY DESCRIPTIVE
MEMORANDUM, OR ANY REPORT OF ANY PETROLEUM ENGINEERING CONSULTANT, OR ANY
GEOLOGICAL OR SEISMIC DATA OR INTERPRETATION, RELATING TO THE ASSETS, (III) THE
QUANTITY, QUALITY, OR RECOVERABILITY OF PETROLEUM SUBSTANCES IN OR FROM THE
ASSETS, (IV) THE EXISTENCE OF ANY PROSPECT, RECOMPLETION, INFILL, OR STEP-OUT
DRILLING OPPORTUNITIES, (V) ANY ESTIMATES OF THE VALUE OF THE ASSETS OR FUTURE
REVENUES GENERATED BY THE ASSETS, (VI) THE PRODUCTION OF PETROLEUM SUBSTANCES
FROM THE ASSETS, OR WHETHER PRODUCTION HAS BEEN CONTINUOUS, OR IN PAYING
QUANTITIES, OR ANY PRODUCTION OR DECLINE RATES, (VII) THE MAINTENANCE, REPAIR,
CONDITION, ENVIRONMENTAL CONDITION, QUALITY, SUITABILITY, DESIGN, OR
MARKETABILITY OF THE ASSETS, (VIII) INFRINGEMENT OF ANY INTELLECTUAL PROPERTY
RIGHT, (IX) ANY OTHER MATERIALS OR INFORMATION THAT MAY HAVE BEEN MADE AVAILABLE
OR COMMUNICATED TO PURCHASER OR ITS AFFILIATES, OR ITS OR THEIR EMPLOYEES,
AGENTS, CONSULTANTS, REPRESENTATIVES, OR ADVISORS IN CONNECTION WITH THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND ANY DOCUMENTS EXECUTED HEREUNDER
OR ANY DISCUSSION OR PRESENTATION RELATING THERETO OR (X) COMPLIANCE WITH ANY
ENVIRONMENTAL LAW, AND FURTHER DISCLAIM ANY REPRESENTATION OR WARRANTY, EXPRESS
OR IMPLIED, OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR CONFORMITY
TO MODELS OR SAMPLES OF MATERIALS OF ANY EQUIPMENT, IT BEING EXPRESSLY
UNDERSTOOD AND AGREED BY THE PARTIES THAT THE ASSETS ARE BEING TRANSFERRED “AS
IS, WHERE IS,” WITH ALL FAULTS AND DEFECTS, AND THAT PURCHASER HAS MADE OR
CAUSED TO BE MADE SUCH INSPECTIONS AS PURCHASER DEEMS APPROPRIATE.

16. Assumed and Retained Obligations.

(a) Subject to Seller’s indemnity obligations set forth in Section 18, Purchaser
hereby assumes all duties, obligations and liabilities of every kind and
character with respect to the Assets or the ownership or operation thereof
occurring at or after the Effective Time arising out of (i) the terms and
conditions of the Contracts or Leases comprising all or any part of the Assets;
(ii) the physical condition of the Assets; (iii) obligations to properly plug
and abandon or re-plug or re-abandon or remove wells, flowlines, gathering lines
or other facilities, equipment or other personal property or fixtures comprising
part of the Assets; (iv) obligations to restore the surface of the Properties
and obligations to bring the Properties into compliance with applicable
environmental laws (including conducting any remediation activities that may be
required on or otherwise in connection with activities on the Properties); and
(v) any other duty, obligation, event, condition, or liability expressly assumed
by Purchaser under the terms of this Agreement or any document executed in
connection herewith (the “Assumed Obligations”).

(b) Subject to Purchaser’s indemnity obligations set forth in Section 17, Seller
hereby retains all duties, obligations and liabilities of every kind and
character with respect to (i) the items in subparts (i) - (v) in Section 16(a)
above to the extent occurring prior to the Effective Time, (ii) actions, suits
or proceedings against Seller or with respect to the Assets that are pending or
threatened in writing as of the Closing Date; (iii) any personal injury or death
occurring on or attributable to the Assets prior to

 

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the Closing Date; (iv) the payment or mis-payment of royalties, rentals and
other similar payments prior to the Closing Date; (v) the payment or mis-payment
of any property taxes and/or ad valorem taxes prorated and allocable to Seller
pursuant Section 12; and (vi) the Excluded Assets (collectively, the “Retained
Obligations”).

17. Purchaser’s Indemnification. PURCHASER SHALL HEREAFTER RELEASE, DEFEND,
INDEMNIFY AND HOLD HARMLESS SELLER AND SELLER’S INTEREST HOLDERS, PARTNERS,
MEMBERS, MANAGERS, AFFILIATES, AND ITS AND THEIR RESPECTIVE OFFICERS, DIRECTORS,
MANAGERS, EMPLOYEES, AGENTS, SPONSORS, PARTNERS, REPRESENTATIVES, MEMBERS,
SHAREHOLDERS, AFFILIATES, SUBSIDIARIES, SUCCESSORS, HEIRS AND ASSIGNS
(COLLECTIVELY, THE “SELLER INDEMNITEES”) FROM AND AGAINST ANY AND ALL LOSSES AS
A RESULT OF, ARISING OUT OF, OR RELATED TO (I) ANY BREACH OF ANY REPRESENTATION
OR WARRANTY OF PURCHASER CONTAINED HEREIN OR IN ANY CERTIFICATE, DOCUMENT OR
OTHER INSTRUMENT DELIVERED BY OR ON BEHALF OF PURCHASER IN CONNECTION WITH THE
TRANSACTIONS CONTEMPLATED HEREBY, TO THE EXTENT AND ONLY UNTIL THE TERMINATION
DATE OF EACH SUCH REPRESENTATION OR WARRANTY; (II) ANY BREACH OF OR FAILURE BY
PURCHASER TO PERFORM ANY COVENANT OR OBLIGATION CONTAINED HEREIN, TO THE EXTENT
AND ONLY UNTIL THE TERMINATION DATE OF EACH SUCH COVENANT OR OBLIGATION; AND
(III) ANY OF PURCHASER’S ASSUMED OBLIGATIONS, REGARDLESS OF WHETHER CAUSED OR
CONTRIBUTED TO BY THE SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE, STRICT
LIABILITY OR OTHER LEGAL FAULT OF ANY OF THE SELLER INDEMNITEES, BUT EXCLUDING
SELLER INDEMNITEES’ GROSS NEGLIGENCE AND WILLFUL MISCONDUCT, WHICH
INDEMNIFICATION OBLIGATION SHALL SURVIVE INDEFINITELY. FROM AND AFTER THE DATE
HEREOF, INDEMNIFICATION UNDER THIS SECTION 17 SHALL BE SELLER’S SOLE AND
EXCLUSIVE REMEDY WITH RESPECT TO ANY BREACH HEREUNDER. NOTWITHSTANDING ANYTHING
HEREIN TO THE CONTRARY, IN THE EVENT THAT A CLAIM FOR INDEMNIFICATION IS TIMELY
MADE WITHIN THE APPLICABLE SURVIVAL PERIOD SET FORTH ABOVE, SUCH SURVIVAL PERIOD
SHALL BE EXTENDED (SOLELY WITH RESPECT TO SUCH CLAIM FOR INDEMNIFICATION TIMELY
MADE WITHIN THE APPLICABLE SURVIVAL PERIOD SET FORTH ABOVE) UNTIL THE FINAL
RESOLUTION OF SUCH CLAIM.

18. Seller’s Indemnification. SELLER SHALL HEREAFTER RELEASE, DEFEND, INDEMNIFY
AND HOLD HARMLESS PURCHASER AND PURCHASER’S INTEREST HOLDERS, PARTNERS, MEMBERS,
MANAGERS, AFFILIATES, AND ITS AND THEIR RESPECTIVE OFFICERS, DIRECTORS,
MANAGERS, EMPLOYEES, AGENTS, SPONSORS, PARTNERS, REPRESENTATIVES, MEMBERS,
SHAREHOLDERS, AFFILIATES, SUBSIDIARIES, SUCCESSORS, HEIRS AND ASSIGNS
(COLLECTIVELY, THE “PURCHASER INDEMNITEES”) FROM AND AGAINST ANY AND ALL LOSSES
AS A RESULT OF, ARISING OUT OF, OR RELATED TO (I) ANY BREACH OF ANY
REPRESENTATION OR WARRANTY OF SELLER CONTAINED HEREIN OR IN ANY CERTIFICATE,
DOCUMENT OR OTHER INSTRUMENT DELIVERED BY OR ON BEHALF OF SELLER IN CONNECTION
WITH THE TRANSACTIONS CONTEMPLATED HEREBY, TO THE EXTENT AND ONLY UNTIL THE
TERMINATION DATE OF EACH SUCH REPRESENTATION OR WARRANTY; (II) ANY BREACH OF OR
FAILURE BY SELLER TO PERFORM ANY COVENANT OR OBLIGATION CONTAINED HEREIN, TO THE
EXTENT AND ONLY UNTIL THE TERMINATION DATE OF EACH SUCH COVENANT OR OBLIGATION,
AND (III) ANY OF SELLER’S RETAINED OBLIGATIONS, REGARDLESS OF WHETHER CAUSED OR
CONTRIBUTED TO BY THE SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE OR
STRICT LIABILITY OF ANY OF THE PURCHASER INDEMNITEES, BUT EXCLUDING PURCHASER
INDEMNITEES’ GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, WHICH INDEMNIFICATION
OBLIGATION SHALL SURVIVE INDEFINITELY. FROM AND AFTER THE DATE HEREOF,
INDEMNIFICATION UNDER THIS

 

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SECTION 18 SHALL BE PURCHASER’S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO ANY
BREACH HEREUNDER. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IN THE EVENT
THAT A CLAIM FOR INDEMNIFICATION IS TIMELY MADE WITHIN THE APPLICABLE SURVIVAL
PERIOD SET FORTH ABOVE, SUCH SURVIVAL PERIOD SHALL BE EXTENDED (SOLELY WITH
RESPECT TO SUCH CLAIM FOR INDEMNIFICATION TIMELY MADE WITHIN THE APPLICABLE
SURVIVAL PERIOD SET FORTH ABOVE) UNTIL THE FINAL RESOLUTION OF SUCH CLAIM.

19. Claim Notice. To make a claim under Section 17 or Section 18 (as
applicable), the Party entitled to indemnification (the “Indemnified Party”)
must notify the Party having an obligation under Section 17 or Section 18 (as
applicable) (the “Indemnifying Party”) of its claim under this Section 19 (a
“Claim”), including the specific details of and specific basis under this
Agreement for its claim (the “Claim Notice”). The Indemnifying Party shall have
30 days from its receipt of the Claim Notice (a) to cure the Losses complained
of, (b) to admit its liability for those Losses, or (c) to dispute the claim for
those Losses. If the Indemnifying Party does not notify the Indemnified Party
within this 30-day period that it has cured the Losses or that it disputes the
claim for those Losses, the amount of those Losses shall conclusively be deemed
a liability of the Indemnifying Party.

20. Exclusive Remedy. Notwithstanding anything to the contrary contained in this
Agreement, from and after the date hereof, Seller’s and Purchaser’s sole and
exclusive remedy against each other with respect to the purchase and sale of the
Assets shall be pursuant to the express provisions of this Agreement and the
Assignment and Bill of Sale.

21. WAIVER OF CONSUMER RIGHTS. PURCHASER HEREBY WAIVES ITS RIGHTS UNDER THE
PROVISIONS OF THE TEXAS DECEPTIVE TRADE PRACTICES ACT, CHAPTER 17, SUBCHAPTER E,
SECTIONS 17.41 THROUGH 17.63, INCLUSIVE, OF THE TEXAS BUSINESS AND COMMERCE
CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS AND PROTECTIONS. AFTER
CONSULTATION WITH AN ATTORNEY OF PURCHASER’S OWN SELECTION, PURCHASER HEREBY
VOLUNTARILY CONSENTS TO THIS WAIVER. TO EVIDENCE ITS ABILITY TO GRANT SUCH
WAIVER, PURCHASER HEREBY REPRESENTS AND WARRANTS TO SELLER THAT PURCHASER (A) IS
IN THE BUSINESS OF SEEKING OR ACQUIRING, BY PURCHASE OR LEASE, GOODS OR SERVICES
FOR COMMERCIAL OR BUSINESS USE, (B) HAS KNOWLEDGE AND EXPERIENCE IN FINANCIAL
AND BUSINESS MATTERS THAT ENABLE IT TO EVALUATE THE MERITS AND RISKS OF THE
TRANSACTION CONTEMPLATED HEREBY, AND (C) IS NOT IN A SIGNIFICANTLY DISPARATE
BARGAINING POSITION.

22. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original instrument, but all such counterparts together shall
constitute but one agreement.

23. Binding Agreement. This Agreement shall bind and inure to the Parties hereto
and their respective successors and assigns.

24. Notices. All notices that are required or may be given pursuant to this
Agreement shall be sufficient in all respects if given in writing, in English
and delivered personally, by facsimile or by recognized courier service, as
follows:

 

If to Seller:

  

PrimeEnergy Corporation

9821 Katy Freeway, Ste. 1050

Houston, TX 77024

Attention: Kevin M. Fortney

Telephone: 713.735.0000

Facsimile: 713.735.0090

 

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If to Purchaser:      

Guidon Operating LLC

400 E. Las Colinas Blvd., Suite 900

Irving, Texas 75039

Attention: Land Department

Telephone: (972) 427-1698

Facsimile: (469) 677-1783

Either Party may change its address for notice by notice to the other in the
manner set forth above. All notices shall be deemed to have been duly given at
the time of receipt by the Party to which such notice is addressed.

25. Sales or Use Tax, Recording Fees and Similar Taxes and Fees. Notwithstanding
anything to the contrary in this Agreement, Purchaser shall bear any sales, use,
excise, real property transfer or gain, gross receipts, goods and services,
registration, capital, documentary, stamp or transfer taxes, recording fees, and
similar taxes and fees incurred and imposed upon, or with respect to, the
property transfers or other transactions contemplated hereby. Should Seller or
any affiliate thereof pay any amount for which Purchaser is liable under this
Section 25, Purchaser shall, promptly following receipt of Seller’s invoice,
describing the amount in reasonable detail, reimburse the amount paid. If such
transfers are exempt from any such taxes or fees upon the filing of an
appropriate certificate or other evidence of exemption, Purchaser shall timely
furnish to Seller such certificate or evidence.

26. Expenses. Except as otherwise provided in this Agreement, all expenses
incurred by Seller in connection with or related to the authorization,
preparation or execution of this Agreement, and the exhibits hereto, and all
other matters related hereto, including all fees and expenses of counsel,
accountants, brokers and financial advisers employed by Seller, shall be borne
solely and entirely by Seller, and all such expenses incurred by Purchaser shall
be borne solely and entirely by Purchaser.

27. Records.

(a) As soon as practicable, but in no event later than 30 days after the date
hereof, Seller shall deliver or cause to be delivered to Purchaser any Data that
is in the possession of Seller or its affiliates, subject to the next sentence.
Seller may retain the originals of those records relating to tax and accounting
matters and provide Purchaser, at its request, with copies of such records other
than records that pertain solely to income tax matters related to the Assets.
Seller may retain copies of any other records.

(b) Purchaser, for a period of two years following the date hereof, shall:

(i) retain the Data;

(ii) provide Seller, its affiliates, and each of their respective
representatives with reasonable access to the records during normal business
hours for review and copying at Seller’s expense; and

(iii) provide Seller, its affiliates, and each of their respective
representatives with reasonable access, during normal business hours, to
(A) materials received or produced relating to Seller’s obligations under this
Agreement, in each case, for review and copying at Seller’s expense and (B) to
Purchaser’s personnel for the purpose of discussing any such matter or claim.

28. Governing Law. This Agreement and the legal relations between the Parties
shall be governed by and construed in accordance with the laws of the State of
Texas, without regard to principles of conflicts of laws that would direct the
application of the laws of another jurisdiction.

 

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

30. Entire Agreement. This Agreement and the documents to be executed hereunder
and the Exhibits attached hereto constitute the entire agreement among the
Parties pertaining to the subject matter hereof, and supersede all prior
agreements, understandings, negotiations, and discussions, whether oral or
written, of the Parties pertaining to the subject matter hereof; provided,
however, any confidentiality, non-disclosure or similar agreements executed
prior to the date hereof by the Parties shall continue to survive pursuant to
the terms of such agreement(s).

31. Further Assurances. After Closing, each Party agrees to take such further
actions and to execute, acknowledge and deliver all such further documents as
are reasonably requested by the other Parties for carrying out the purposes of
this Agreement or of any document delivered pursuant to this Agreement.

32. No Third-Party Beneficiaries. Nothing in this Agreement shall entitle any
person other than Purchaser and Seller to any claim, cause of action, remedy or
right of any kind, except the rights expressly provided to the persons described
in this Agreement.

33. Severability. If any provision of this Agreement, or any application
thereof, is held invalid, illegal, or unenforceable in any respect under any
law, this Agreement shall be reformed to the extent necessary to conform, in
each case consistent with the intention of the Parties, to such law, and, to the
extent such provision cannot be so reformed, then such provision (or the
invalid, illegal, or unenforceable application thereof) shall be deemed deleted
from (or prohibited under) this Agreement, as the case may be, and the validity,
legality, and enforceability of the remaining provisions contained herein (and
any other application of such provision) shall not in any way be affected or
impaired thereby.

34. Time of the Essence. Time is of the essence in this Agreement. If the date
specified in this Agreement for giving any notice or taking any action is not a
business day (or if the period during which any notice is required to be given
or any action taken expires on a date which is not a business day), then the
date for giving such notice or taking such action (and the expiration of such
period during which notice is required to be given or action taken) shall be the
next day which is a business day.

35. Limitation on Damages. Notwithstanding anything to the contrary contained
herein, neither Purchaser nor Seller, nor any of their respective affiliates
shall be entitled to consequential, special, or punitive damages in connection
with this Agreement and the transactions contemplated hereby (other than
consequential, special, or punitive damages suffered by third party for which
responsibility is allocated between the Parties pursuant to this Agreement) and
Purchaser and Seller, for themselves and on behalf of their respective
affiliates, hereby expressly waive any right to consequential, special, or
punitive damages in connection with this Agreement and the transactions
contemplated hereby (other than consequential, special, or punitive damages
suffered by third party for which responsibility is allocated between the
Parties pursuant to this Agreement).

 

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36. Limitations as to Excluded Wellbores.

(a) As part of the consideration for the purchase of the Assets, Seller
acknowledges that it retains no right to drill any additional wells on the
Leases, even to replace an Excluded Wellbore that is lost for mechanical or any
other reason. Furthermore, Seller will have no right to deepen or recomplete an
Excluded Wellbore. Seller may plug back an Excluded Wellbore and may rework an
Excluded Wellbore in any zone from which such Excluded Wellbore is producing as
of the Effective Time. In connection with the retention of the Excluded
Wellbores, Seller also will retain:

(i) all related personal property and equipment and the right to produce the
Excluded Wellbores and save and sell the production attributable to said
Excluded Wellbores, subject to the terms of this Agreement;

(ii) Subject to all the terms of this Agreement, sufficient rights in the Leases
to produce the Excluded Wellbores under the applicable Texas Railroad Commission
rules; and

(iii) Equal and concurrent access to the surface of the Lands, in accordance
with the terms of the Leases, for ingress and egress to operate the Excluded
Wellbores and performing other functions reasonably necessary to produce
hydrocarbons from the Excluded Wellbores.

(b) After Closing, if there are existing joint operating agreements binding on
the Leases Seller will use its best efforts, to obtain on or before April 1,
2017:

(i) a valid and properly executed release of the Leases from the terms of such
joint operating agreements except as to the Excluded Wellbores, in a form
acceptable to Purchaser in its sole discretion, so that Purchaser may operate
the undeveloped portions of the Leases free and clear of the applicable joint
operating agreement or agreements; or

(ii) a valid and properly executed amendment to the applicable joint operating
agreement or agreements, in a form acceptable to Purchaser in its sole
discretion, providing for:

(1) Purchaser to operate the wells drilled by Purchaser on the Leases,
notwithstanding that Seller remains as operator of the Excluded Wellbores; and

(2) Waiving any claims by the remaining working interest owners with respect to
the maintenance of uniform interest provisions in the applicable agreements, if
any. The document referred to in (i) or (ii), as applicable will be referred to
as the “OA Instrument.”

(c) In the event Seller fails to deliver the OA Instruments as required, Seller
will hold Purchaser harmless from and against any claims by working interest
owners under any joint operating agreements arising or resulting from the
conveyance of the Leases to Purchaser, including but not limited to claims for
violation of the maintenance of uniform interest provision under any such joint
operating agreement.

(d) Seller agrees that it will provide all reasonable support requested by
Purchaser for obtaining permits, field rules, determinations, approvals, and any
other action from the Texas Railroad Commission, including but not limited to
Rule 37 and Rule 38 density exceptions and Statewide Rule 40(d) (16 Texas Admin.
Code §3.40(d)) exceptions necessary to permit duplicate assignment of acreage,
that may be necessary or useful in the formation of units and/or the drilling of
any wells on the Leases by Purchaser, . Such support may include, but is not
limited to, the submission of support and waiver letters to the RRC. Any
requested filings or letters shall be provided within fourteen (14) days
following the request.

 

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(e) In connection with operation of Excluded Wellbores:

(i) If an Excluded Wellbore that is the last producing well on a Lease or a
segregated portion of a Lease that is treated separately for purposes of lease
maintenance is shut-in or fails to produce for fourteen (14) consecutive days,
Seller must notify Purchaser in writing as soon as reasonably possible, but in
no event later than seven (7) days after such fourteen (14) day period (such
notice, an “Event Notice”). The Event Notice shall state whether Seller intends
to take steps to attempt to return the Excluded Wellbore to production.

(ii) Upon receipt of an Event Notice stating that Seller will not take steps to
attempt to return the relevant Excluded Wellbore to production, Purchaser will
have the option to receive an assignment of Seller’s interest in the applicable
Excluded Wellbore and assume operations of the affected Excluded Wellbore by
giving Seller written notice within fourteen (14) days of receiving the Event
Notice, and paying Seller the Salvage Value, unless Seller demonstrates to
Purchaser’s reasonable satisfaction that the event that is the subject of the
Event Notice has been or will be cured. The term “Salvage Value” means the
excess, if any, of the value of the personal property and equipment associated
with the applicable Excluded Wellbore, but specifically excluding any personal
property and/or equipment which is still being utilized by Seller, less the
estimated cost of plugging the Excluded Wellbore and restoring the surface of
the affected portion of the Land. If the estimated cost of plugging exceeds the
value of the personal property and equipment, no money will change hands upon
this assignment and Purchaser will assume the obligation to properly plug and
abandon the Excluded Wellbore. If Purchaser exercises its option to acquire such
Excluded Wellbore the assignment from the Seller to Purchaser will be in the
form of the Excluded Wellbore assignment attached as Exhibit “C”. The
obligations under this Section 36 will terminate three (3) years after the
Effective Time.

(f) If, within three (3) years after the Effective Time, Seller (i) extends or
renews any Lease covering any portion of the Lands, or (ii) takes a new lease
covering any interest previously covered by a Lease that has terminated or
expired and covers any portion of the Lands within two years of the date such
Lease terminated, expired, or would have terminated absent the renewal or
extension; or (iii) acquires additional undivided interests in the Leases; to
the extent such additional interests cover the Lands (any such new lease,
renewal, extension or additional undivided interest on Lands will be referred to
herein as an “Interest” or collectively as “Interests”), Seller shall, within
thirty (30) days of finalizing the acquisition, offer to the Purchaser the right
to purchase the Interest by paying the Seller’s costs (such costs to include,
but are not necessarily limited to, lease bonus, option payments, broker fees,
filing fees and cost of third party title examination). If an acquisition of
Interests includes Interests in Outgoing Lands and other lands, the Seller will
only be required to offer the Interests in Lands. When less than all tracts
covered by an acquisition of several Interests is offered, the Seller’s cost
applicable to the Interests offered will be that portion of the total cost equal
to the ratio of the offered Interests to the total acquisition on a net acre
basis. If two or more Interests are included in a single notice, the Purchaser
will have the right to make separate elections as to each of the acquired
Interests.

(i) An offer made pursuant to this provision must be in writing and include
sufficient information for the Purchaser to reasonably evaluate the offer,
including, a complete description of the acquired Interest and information
specifying the number of gross and net acres, existing overriding royalties or
other burdens affecting the Interest, the purchase price and the terms of the
acquisition, as well as the actual acquisition costs, the obligations required
to earn such interest, including bonus considerations or equivalent if other
than cash, broker’s fees, recording fees, and rentals, and any other information
the acquiring party deems relevant to the acquisition of the Interest. The
Purchaser the offer will have thirty (30) days (the “Acceptance Period”)
following receipt of such notice in which to elect to participate in the
acquisition and to submit payment to the Seller. Payment shall be made by wire
transfer of immediately available funds to an account designated by the Seller.
The failure to reply in writing to an offer and submit payment within the time
period specified herein will be deemed to be a refusal to participate.

 

16

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(ii) If the Purchaser elects to accept the offer, the acquiring party shall
assign the Interest to the Purchaser within ten (10) business days of receiving
the purchaser’s payment, free and clear of any burdens other than those incurred
by the acquiring party to acquire the Interest. Failure of the Purchaser to
(i) respond to an acquisition notice, or (ii) pay the costs within the
Acceptance Period will be deemed an election not to acquire a share of the
Interest.

(iii) If an Interest is to be earned by drilling a well or wells or shooting
seismic, the Purchaser must ratify all appropriate agreements within the
Acceptance Period and agree to participate in and pay for in such required
operations. If the Purchaser fails to ratify such agreements or fails to pay for
its share of such Interest, the Seller shall hold such interest free and clear
of any further obligations under this Agreement.

(iv) Notwithstanding anything herein to the contrary, the provisions set forth
in this Section 36 will not apply to any acquisitions which (i) result from a
merger, consolidation, reorganization with, by, or between a parent company,
subsidiary, or affiliated company of either of the parties, or (ii) result from
a merger or acquisition of the stock of another company or all of an entity or
partnership or an acquisition of all or substantially all of the assets of an
entity by the acquiring party, whether by cash, like-kind exchange, stock
purchase or otherwise.

(g) Seller and Purchaser shall each maintain their own surface facilities and
equipment. If any Party damages the surface facilities or equipment of the other
Party, the Party damaging the surface facilities or equipment shall be
responsible for any costs to repair or replace any such surface facilities or
equipment. Each Party shall be responsible for repairing any damage to jointly
used roads or easements caused by its operations.

37. No Recourse. Notwithstanding anything herein or in any agreement, instrument
or document delivered in connection with this Agreement, the Assignment or any
associated agreement, (i) Seller hereby acknowledges, and agrees, that no person
other than Purchaser, including any current or former director, officer,
employee, member, manager, director, partner, investor, shareholder, agent,
representative or affiliate (the “Purchaser Non-Recourse Parties”), shall have
any liability to Seller, and Seller shall have no recourse against any person
other than Purchaser in connection with any liability, claim or cause of action
arising out of, or in relation to, this Agreement, the Assignment and Bill of
Sale, the transactions contemplated hereby and thereby and any instruments,
documents or discussions in connection therewith, whether pursuant to any
attempt to pierce the corporate veil, any claims for fraud, negligence or
misconduct or any other claims otherwise available or asserted at law or in
equity. Seller acknowledges and agrees that the Purchaser Non-Recourse Parties
have participated in and will continue to participate in (directly or
indirectly) investments in the oil and gas and exploration and production
industry that may, are or will be competitive with the Assets and Seller’s
business (“Purchaser Other Investments”). Not in limitation of the foregoing,
Seller hereby expressly waives any potential conflicts of interest, and none of
the Purchaser Non-Recourse Parties shall have any liability to Seller under this
Agreement or the transactions contemplated hereby in connection with such
Purchaser Other Investments, and (ii) Purchaser hereby acknowledges, and agrees,
that no person other than Seller, including any current or former director,
officer, employee, member, manager, director, partner, investor, shareholder,
agent, representative or affiliate (the “Seller Non-Recourse Parties”), shall
have any liability to Purchaser, and Purchaser shall have no recourse against
any person other than Seller in connection with any liability, claim or cause of
action arising out of, or in relation to, this Agreement, the Assignment and
Bill of Sale, the transactions contemplated hereby and thereby and any
instruments, documents or discussions in connection therewith, whether pursuant
to any attempt to pierce the corporate veil, any claims for fraud, negligence or
misconduct or any other claims otherwise available or asserted at law or in
equity. Purchaser acknowledges and agrees that the Seller Non-Recourse Parties
have participated in and will continue to participate in (directly or
indirectly) investments in the oil and gas and exploration and production
industry that may, are or will be competitive with the Assets and Purchaser’s
business (“Seller’s Other Investments”). Not in limitation of the foregoing,
Purchaser hereby expressly waives any potential conflicts of interest, and none
of the Seller Non-Recourse Parties shall have any liability to Purchaser under
this Agreement or the transactions contemplated hereby in connection with such
Seller Other Investments.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

17

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IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this
Agreement as of the date first set forth above.

 

SELLER: PRIMEENERGY CORPORATION By:    /s/ Beverly A. Cummings Name:   Beverly
A. Cummings Title:   Executive Vice President PRIMEENERGY MANAGEMENT CORPORATION
By:    /s/ Beverly A. Cummings Name:   Beverly A. Cummings Title:   Executive
Vice President PRIMEENERGY ASSET & INCOME FUND, L.P. A-2 By: PRIMEENERGY
MANAGEMENT CORPORATION, its General Partner By:    /s/ Beverly A. Cummings Name:
  Beverly A. Cummings Title:   Executive Vice President PRIMEENERGY ASSET &
INCOME FUND, L.P. A-3 By: PRIMEENERGY MANAGEMENT CORPORATION, its General
Partner By:    /s/ Beverly A. Cummings Name:   Beverly A. Cummings Title:  
Executive Vice President PRIMEENERGY ASSET & INCOME FUND, L.P. AA-2 By:
PRIMEENERGY MANAGEMENT CORPORATION, its General Partner By:    /s/ Beverly A.
Cummings Name:   Beverly A. Cummings Title:   Executive Vice President

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

PRIMEENERGY ASSET & INCOME FUND, L.P. AA-4 By: PRIMEENERGY MANAGEMENT
CORPORATION, its General Partner By:    /s/ Beverly A. Cummings Name:   Beverly
A. Cummings Title:   Executive Vice President PRIME OPERATING COMPANY By:    /s/
Beverly A. Cummings Name:   Beverly A. Cummings Title:   Executive Vice
President PURCHASER: GUIDON OPERATING LLC By:    /s/ Jay P. Still Name:   Jay P.
Still Title:   President and Chief Executive Officer

Exhibit B – Form of Assignment and Bill of Sale

 

19

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Exhibit A to PSA

 

Lessor

  Lessee   Lease
Executed Date   Lease Recorded
Date   County   Section   Block   Survey   Tract   Lease Vol/Pg JP Morgan Chase
Bank, Trustee   PrimeEnergy Corporation   9/1/2011   3/7/2012   Martin   1  
38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/554 Ronald J. Nail Revocable Trust, et
al   PrimeEnergy Corporation   9/1/2011   3/7/2012   Martin   1   38 T1S   T&P
Ry. Co. Sy.   S/2 NE/4   330/557 Mallard Royalty Partners   PrimeEnergy
Corporation   12/20/2011   3/7/2012   Martin   1   38 T1S   T&P Ry. Co. Sy.  
S/2 SE/4   330/563 Mallard Royalty Partners   PrimeEnergy Corporation  
12/20/2011   3/7/2012   Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 NE/4  
330/566 Burley Revocable Living Trust   PrimeEnergy Corporation   9/1/2011  
3/7/2012   Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/572 Burley
Revocable Living Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012   Martin
  1   38 T1S   T&P Ry. Co. Sy.   S/2 NE/4   330/575 J.H.B. Oil and Gas Company,
LLC   PrimeEnergy Corporation   9/1/2011   3/7/2012   Martin   1   38 T1S   T&P
Ry. Co. Sy.   S/2 SE/4   330/581 J.H.B. Oil and Gas Company, LLC   PrimeEnergy
Corporation   9/1/2011   3/7/2012   Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2
NE/4   330/584 Sharon Lynn Gilbert GST Exempt Trust
and the Sharon Lynn Gilbert Trust   PrimeEnergy Corporation   9/1/2011  
3/7/2012   Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/590 Sharon
Lynn Gilbert GST Exempt Trust
and the Sharon Lynn Gilbert Trust   PrimeEnergy Corporation   9/1/2011  
3/7/2012   Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 NE/4   330/593 Dennis
Barrie Stimson GST Exempt Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012
  Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/599 Dennis Barrie
Stimson GST Exempt Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012  
Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 NE/4   330/602 Morris Jerome Stimson
GST Exempt Trust
and Stimson Energy Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012  
Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/608 Morris Jerome Stimson
GST Exempt Trust
and Stimson Energy Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012  
Martin   1   38 T1S   T&P Ry. Co. Sy.   S/2 NE/4   330/611 J.H. Nail, Jr., et al
Trust, Texas American Bank, Trustee   Brazos Petroleum Company   1/14/1985  
4/1/1985   Martin   2   38 T1N   T&P Ry. Co. Sy.   SE/4 SW/4   254/13      
4/1/1985   Martin   2   38 T1N   T&P Ry. Co. Sy.   SW/4 SW/4   Ronald J. Nail
Revocable Trust, et al   PrimeEnergy Corporation   9/1/2011   3/7/2012   Martin
  2   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/560 Mallard Royalty Partners  
PrimeEnergy Corporation   12/20/2011   3/7/2012   Martin   2   38 T1S   T&P Ry.
Co. Sy.   S/2 SE/4   330/569 Burley Revocable Living Trust   PrimeEnergy
Corporation   9/1/2011   3/7/2012   Martin   2   38 T1S   T&P Ry. Co. Sy.   S/2
SE/4   330/578

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

Exhibit A to PSA

 

J.H.B. Oil and Gas Company, LLC   PrimeEnergy Corporation   9/1/2011   3/7/2012
  Martin   2   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/587 Sharon Lynn Gilbert
GST Exempt Trust
and the Sharon Lynn Gilbert Trust   PrimeEnergy Corporation   9/1/2011  
3/7/2012   Martin   2   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/596 Dennis
Barrie Stimson GST Exempt Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012
  Martin   2   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/605 Morris Jerome
Stimson GST Exempt Trust
and Stimson Energy Trust   PrimeEnergy Corporation   9/1/2011   3/7/2012  
Martin   2   38 T1S   T&P Ry. Co. Sy.   S/2 SE/4   330/614 Ronald J. Nail
Revocable Trust, et al   PrimeEnergy Corporation   1/4/2012   3/20/2012   Martin
  2   38 T1S   T&P Ry. Co. Sy.   SE/4 SW/4   331/509         Martin   2   38 T1S
  T&P Ry. Co. Sy.   SW/4 SW/4   Burley Revocable Living Trust   PrimeEnergy
Corporation   9/17/2012   11/5/2012   Martin   2   38 T1S   T&P Ry. Co. Sy.  
SE/4 SW/4   356/109         Martin   2   38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4  
J.H.B. Oil and Gas Company, LLC   PrimeEnergy Corporation   11/8/2012   1/2/2013
  Martin   2   38 T1S   T&P Ry. Co. Sy.   SE/4 SW/4   361/670         Martin   2
  38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4   Flex Family Trust   PrimeEnergy
Corporation   11/15/2013   1/17/2014   Martin   2   38 T1S   T&P Ry. Co. Sy.  
SE/4 SW/4   398/84         Martin   2   38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4  
Morris Jerome Stimson GST Exempt Trust   PrimeEnergy Corporation   3/15/2013  
1/17/2014   Martin   2   38 T1S   T&P Ry. Co. Sy.   SE/4 SW/4   398/86        
Martin   2   38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4   The Stimson Energy Trust  
PrimeEnergy Corporation   3/15/2013   1/17/2014   Martin   2   38 T1S   T&P Ry.
Co. Sy.   SE/4 SW/4   398/90         Martin   2   38 T1S   T&P Ry. Co. Sy.  
SW/4 SW/4   Waddell Strain and wife, Geraldine Strain
Edd Homan Strain
Jerry Dell Haggerton
Larry Waddell Strain
Albert Thomas Morris
Garland Kirk Morris
Scott Douglas Morris   Worth E. Whitworth   11/6/1979   1/30/1980   Martin   14
  36 T1N   T&P Ry. Co. Sy.   SE/4   192/3         Martin   19   35 T1N   T&P Ry.
Co. Sy.   W/2           Martin   24   36 T1N   T&P Ry. Co. Sy.   NW/4  

 

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

Exhibit A to PSA

 

Exchange Oil & Gas Corporation   The Superior Oil
Company   10/5/1983   11/16/1983   Martin   14   36 T1N   T&P Ry. Co. Sy.   SE/4
  234/229         Martin   24   36 T1N   T&P Ry. Co. Sy.   NW/4   Exchange Oil &
Gas Corporation   The Superior Oil Company   10/5/1983   11/16/1983   Martin  
19   36 T1N   T&P Ry. Co. Sy.   W/2   234/233 Marjorie E. Bentley and husband,
John J. Bentley   Clelan D. Atchison and
Gertie Marie Atchison   1/30/1980   3/4/1980   Martin   20   36 T1S   T&P Ry.
Co. Sy.   PT NE/4 Lying
North of IH20   193/435 J.H. Nail, Jr., et al Trust, Texas American Bank,
Trustee   Orseth & Robinson, Inc.   1/13/1984   3/21/1984   Martin   28   38 T1N
  T&P Ry. Co. Sy.   S/2 SE/4   238/443         Martin   28   38 T1N   T&P Ry.
Co. Sy.   S/2 NE/4           Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 NW/4  
Burley Revocable Living Trust   PrimeEnergy Corporation   9/17/2012   11/5/2012
  Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 SE/4   356/106         Martin  
28   38 T1N   T&P Ry. Co. Sy.   S/2 NE/4           Martin   28   38 T1N   T&P
Ry. Co. Sy.   S/2 NW/4   Ronald J. Nail Revocable Trust, et al   PrimeEnergy
Corporation   7/26/2012   11/5/2012   Martin   28   38 T1N   T&P Ry. Co. Sy.  
S/2 SE/4   356/112         Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 NE/4    
      Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 NW/4   J.H.B. Oil & Gas
Company, LLC   PrimeEnergy Corporation   11/8/2012   1/2/2013   Martin   28   38
T1N   T&P Ry. Co. Sy.   S/2 SE/4   361/662         Martin   28   38 T1N   T&P
Ry. Co. Sy.   S/2 NE/4           Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2
NW/4   The Flex Family Trust   PrimeEnergy Corporation   3/15/2013   1/17/2014  
Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 SE/4   398/82         Martin   28  
38 T1N   T&P Ry. Co. Sy.   S/2 NE/4           Martin   28   38 T1N   T&P Ry. Co.
Sy.   S/2 NW/4   Stimson Energy Trust   PrimeEnergy Corporation   3/15/2013  
1/17/2014   Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 SE/4   398/88        
Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 NE/4           Martin   28   38 T1N
  T&P Ry. Co. Sy.   S/2 NW/4  

 

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

Exhibit A to PSA

 

Morris Jerome Stimson GST Exempt Trust   PrimeEnergy Corporation   3/15/2013  
1/17/2014   Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 SE/4   398/92        
Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 NE/4           Martin   28   38 T1N
  T&P Ry. Co. Sy.   S/2 NW/4   Mallard Royalty Partners   PrimeEnergy
Corporation   12/1/2013   3/7/2014   Martin   2   38 T1S   T&P Ry. Co. Sy.  
SE/4 SW/4   403/425         Martin   2   38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4  
        Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 SE/4           Martin   28
  38 T1N   T&P Ry. Co. Sy.   S/2 NE/4           Martin   28   38 T1N   T&P Ry.
Co. Sy.   S/2 NW/4   Sharon Lynn Gilbert, Individually and
Sharon Lynn Gilbert GST Exempt Trust   PrimeEnergy Corporation   2/27/2014  
4/16/2014   Martin   2   38 T1S   T&P Ry. Co. Sy.   SE/4 SW/4   407/67        
Martin   2   38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4           Martin   28   38 T1N
  T&P Ry. Co. Sy.   S/2 SE/4           Martin   28   38 T1N   T&P Ry. Co. Sy.  
S/2 NE/4           Martin   28   38 T1N   T&P Ry. Co. Sy.   S/2 NW/4   Nathan
Heidelberg, Jr. a married man dealing in his sole and separate property   Brazos
Petroleum
Company   9/1/1983   10/13/1983   Martin   29   35 T1N   T&P Ry. Co. Sy.   SW/4
  233/97 Nathan Heidelberg, a widower   Brazos Petroleum
Company   9/1/1983   10/13/1983   Martin   29   35 T1N   T&P Ry. Co. Sy.   SW/4
  233/103 Harlow Royalties, Inc.   Panther Petroleum, Inc.   9/6/1983  
9/19/1983   Martin   29   35 T1N   T&P Ry. Co. Sy.   SW/4   232/269 Sue Henson
Standefer, a married woman dealing in her sole and separate property   Brazos
Petroleum
Company   9/20/1983   10/24/1983   Martin   29   35 T1N   T&P Ry. Co. Sy.   SW/4
  233/280 Ruby Henson Haggard, a married woman dealing in her sole and separate
property   Brazos Petroleum
Company   9/20/1986   11/14/1983   Martin   29   35 T1N   T&P Ry. Co. Sy.   SW/4
  234/94

 

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

Exhibit A to PSA

 

Kentex Mineral Company   Brazos Petroleum Company   1/11/1984   2/9/1984  
Martin   29   35 T1N   T&P Ry. Co. Sy.   N/2 NW/4   237/95         Martin   29  
35 T1N   T&P Ry. Co. Sy.   S/2 NW/4   Nathan Heidelberg   Palomino Oil Co.  
6/6/1983   9/7/1983   Martin   30   35 T1N   T&P Ry. Co. Sy.   W/2 SE/4   232/7
        Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2 SW/4           Martin   30
  35 T1N   T&P Ry. Co. Sy.   E/2 SE/4           Martin   30   35 T1N   T&P Ry.
Co. Sy.   N/2 SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2 NW/4  
        Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NW/4           Martin   30
  35 T1N   T&P Ry. Co. Sy.   N/2 NE/4   Nathan Heidelberg, Jr.   Palomino Oil
Co.   6/6/1983   10/6/1983   Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NW/4  
232/656         Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NE/4          
Martin   30   35 T1N   T&P Ry. Co. Sy.   E/2 SE/4           Martin   30   35 T1N
  T&P Ry. Co. Sy.   S/2 NW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.  
N/2 SW/4   John M. McWhorter and wife, Loretta McWhorter   Robert B. Ross &
Associates, Inc.   10/12/1979   11/19/1979   Martin   30   35 T1N   T&P Ry. Co.
Sy.   N/2 NW/4   189/472         Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2
NE/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   E/2 SE/4          
Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 SW/4           Martin   30   35 T1N
  T&P Ry. Co. Sy.   S/2 NW/4           Martin   31   35 T1N   T&P Ry. Co. Sy.  
E/2 NE/4  

 

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

Exhibit A to PSA

 

Ralph B. McWhorter, a single man   Robert B. Ross &
Associates, Inc.   10/17/1979   1/4/1980   Martin   30   35 T1N   T&P Ry. Co.
Sy.   W/2 SE/4   190/690         Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2
NW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NE/4          
Martin   30   35 T1N   T&P Ry. Co. Sy.   E/2 SE/4           Martin   30   35 T1N
  T&P Ry. Co. Sy.   N/2 SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.  
S/2 NW/4           Martin   31   35 T1N   T&P Ry. Co. Sy.   E/2 NE/4   W.D.
McWhorter and wife, Nora R. McWhorter   Robert B. Ross &
Associates, Inc.   10/17/1979   1/4/1980   Martin   30   35 T1N   T&P Ry. Co.
Sy.   W/2 SE/4   190/693         Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2
SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NW/4          
Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NE/4           Martin   30   35 T1N
  T&P Ry. Co. Sy.   E/2 SE/4           Martin   30   35 T1N   T&P Ry. Co. Sy.  
N/2 SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2 NW/4          
Martin   31   35 T1N   T&P Ry. Co. Sy.   E/2 NE/4   Grace Brown McWhorter
LeMonds, a widow   Robert B. Ross &
Associates, Inc.   10/17/1979   1/4/1980   Martin   30   35 T1N   T&P Ry. Co.
Sy.   W/2 SE/4   190/697         Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2
SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NW/4          
Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 NE/4           Martin   30   35 T1N
  T&P Ry. Co. Sy.   E/2 SE/4           Martin   30   35 T1N   T&P Ry. Co. Sy.  
N/2 SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2 NW/4          
Martin   31   35 T1N   T&P Ry. Co. Sy.   E/2 NE/4  

 

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

Exhibit A to PSA

 

Sue Henson Standefer   Robert B. Ross &
Associates, Inc.   10/7/1980   10/30/1980   Martin   30   35 T1N   T&P Ry. Co.
Sy.   E/2 SE/4   201/605         Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2
SW/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   S/2 NW/4          
Martin   31   35 T1N   T&P Ry. Co. Sy.   E/2 NE/4   Ruby Henson Haggard, dealing
in her sole and separate property   Robert B. Ross &
Associates, Inc.   10/7/1980   12/23/1980   Martin   30   35 T1N   T&P Ry. Co.
Sy.   N/2 NW/4   202/805         Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2
NE/4           Martin   30   35 T1N   T&P Ry. Co. Sy.   E/2 SE/4          
Martin   30   35 T1N   T&P Ry. Co. Sy.   N/2 SW/4           Martin   30   35 T1N
  T&P Ry. Co. Sy.   S/2 NW/4           Martin   31   35 T1N   T&P Ry. Co. Sy.  
E/2 NE/4   George W. Glass and wife, Mabel Holt Glass, et al   Texaco, Inc.  
11/26/1969   2/17/1970   Martin   31   38 T1N   T&P Ry. Co. Sy.   S/2 SE/4  
124/129         Martin   31   38 T1N   T&P Ry. Co. Sy.   S/2 NW/4   Katherine M.
Caton, a widow   Robert B. Ross &
Associates, Inc.   10/12/1979   11/19/1979   Martin   31   35 T1N   T&P Ry. Co.
Sy.   E/2 NE/4   189/466 James H. Nail, Jr., Trustee   Houston Production
Company   12/29/1979   2/6/1980   Martin   38   38 T1N   T&P Ry. Co. Sy.   SE/4
SE/4   192/355         Martin   38   38 T1N   T&P Ry. Co. Sy.   SW/4 SE/4      
    Martin   1   38 T1S   T&P Ry. Co. Sy.   NW/4 SE/4           Martin   1   38
T1S   T&P Ry. Co. Sy.   NE/4 SE/4           Martin   2   38 T1S   T&P Ry. Co.
Sy.   SE/4 SW/4           Martin   2   38 T1S   T&P Ry. Co. Sy.   SW/4 SW/4    
      Martin   6   37 T1S   T&P Ry. Co. Sy.   SE/4 SW/4           Martin   6  
37 T1S   T&P Ry. Co. Sy.   SW/4 SW/4           Martin   6   37 T1S   T&P Ry. Co.
Sy.   N/2 SW/4  

 

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

Exhibit A to PSA

 

Gerald Fitz-Gerald   John L. Cox   8/12/1969   8/12/1969   Martin   39   35 T1N
  T&P Ry. Co. Sy.   S/2 SE/4   121/175 Luther Bohanon   John L. Cox   8/3/1969  
8/25/1969   Martin   39   35 T1N   T&P Ry. Co. Sy.   S/2 SE/4   121/235 Midwest
Oil Corporation   John L. Cox   7/31/1969   8/25/1969   Martin   39   35 T1N  
T&P Ry. Co. Sy.   S/2 SE/4   121/238 Ben J. Shaw   John L. Cox   8/23/1969  
8/25/1969   Martin   39   35 T1N   T&P Ry. Co. Sy.   S/2 SE/4   121/257 Juana
Henke   John L. Cox   8/8/1969   9/23/1969   Martin   39   35 T1N   T&P Ry. Co.
Sy.   S/2 SE/4   121/476 Loyd Hasting and wife, Mildred Hasting   Andrew Hancock
  12/29/1969   1/30/1970   Martin   39   37 T1N   T&P Ry. Co. Sy.   SW/4  
123/461 Robert E. Smyth and wife, Dorothy Smyth   Andrew Hancock   3/2/1970  
3/18/1970   Martin   39   37 T1N   T&P Ry. Co. Sy.   SW/4   124/492 Earl L.
Henke, Duardian of the Estate of Mary Mitchell Henke, a minor   John L. Cox  
3/2/1970   3/25/1970   Martin   39   35 T1N   T&P Ry. Co. Sy.   S/2 SE/4  
125/84 Joe Canon and wife, Verna Marie Canon   Andrew Hancock   5/1/1970  
5/11/1970   Martin   39   37 T1N   T&P Ry. Co. Sy.   SW/4   126/350 W.C. Hines  
Mark Woodside   6/4/1984   7/6/1984   Martin   39   35 T1N   T&P Ry. Co. Sy.  
S/2 SE/4   242/405 C.E. Edgerton   Mark Woodside   6/4/1984   7/6/1984   Martin
  39   35 T1N   T&P Ry. Co. Sy.   S/2 SE/4   242/407 Rosemary Ferrell, a widow  
Mark Woodside   6/11/1984   7/6/1984   Martin   39   35 T1N   T&P Ry. Co. Sy.  
S/2 SE/4   242/409 Alfred F. Anderson and Goldie E. Anderson, husband and wife  
Mark W. Woodside   7/3/1984   7/19/1984   Martin   39   35 T1N   T&P Ry. Co. Sy.
  S/2 SE/4   243/11 E. Hayes Sieber, a single man, Et al  
Trinity Production Company   7/30/1984   10/11/1984   Martin   39   35 T1N   T&P
Ry. Co. Sy.   S/2 SE/4   246/473 RepublicBank First National Midland, Sole
Trustee of the Jessie Blevins Crump Family Trust   Brazos Petroleum
Company   6/24/1985   7/15/1985   Martin   39   35 T1N   T&P Ry. Co. Sy.   S/2
SE/4   259/458 RepublicBank First National Midland, Trustee  
Brazos Petroleum Company   7/8/1985   8/12/1985   Martin   39   35 T1N   T&P Ry.
Co. Sy.   S/2 SE/4   260/539

 

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

Exhibit A to PSA

 

Texas American Bank Fort Worth, N.A. and David C. Blevins, Co-Trustees of the
Joe and Jesse Crump Fund   Brazos Petroleum Company   6/24/1985   11/22/1985  
Martin   39   35 T1N   T&P Ry. Co. Sy.   S/2 SE/4   265/238 Claude S. Williams
and wife, Janis Williams, and Lou Ella Sparks, a feme sole   Andrew Hancock  
10/10/1969   11/13/1969   Martin   46   37 T1N   T&P Ry. Co. Sy.  
S/83.75 acs of W/2   122/264 Clyde E. Thomas, Jr. and wife, Jane Eden Thomas  
Max H. Christensen   12/2/1969   1/12/1970   Martin   46   37 T1N   T&P Ry. Co.
Sy.   S/83.75 acs of W/2   123/311         Martin   46   37 T1N   T&P Ry. Co.
Sy.   S/2 SW/4 NE/4           Martin   46   37 T1N   T&P Ry. Co. Sy.  
S/2 SE/4 NW/4           Martin   46   37 T1N   T&P Ry. Co. Sy.   N/2 NE/4 SW/4  
        Martin   46   37 T1N   T&P Ry. Co. Sy.   N/2 NW/4 SE/4   James H. Nail,
Jr., Trustee   Houston Production Company   12/29/1979   2/6/1980   Martin   38
  38 T1N   T&P Ry. Co. Sy.   SE/4 SE/4   192/355         Martin   38   38 T1N  
T&P Ry. Co. Sy.   SW/4 SE/4           Martin   1   38 T1S   T&P Ry. Co. Sy.  
NW/4 SE/4           Martin   1   38 T1S   T&P Ry. Co. Sy.   NE/4 SE/4          
Martin   2   38 T1S   T&P Ry. Co. Sy.   SE/4 SW/4           Martin   2   38 T1S
  T&P Ry. Co. Sy.   SW/4 SW/4           Martin   6   37 T1S   T&P Ry. Co. Sy.  
SE/4 SW/4           Martin   6   37 T1S   T&P Ry. Co. Sy.   SW/4 SW/4          
Martin   6   37 T1S   T&P Ry. Co. Sy.   N/2 SW/4  

 

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

Defect Schedule

Exhibit “A” to LOI

 

Spraberry ($35,000 x 40%)

  $
 
14,000.00  
                 

WCA ($35,000 x 30%)

  $
 
10,500.00  
      Part of the WCA (5/12 Value)   $ 4,375.00          

WCB ($35,000 x 30%)

  $
 
10,500.00  
                 

Spraberry ($26,000 x 40%)

  $
 
10,400.00  
                 

WCA ($26,000 x 30%)

  $ 7,800.00       Part of the WCA (5/12 Value)   $ 3,250.00          

WCB ($26,000 x 30%)

  $ 7,800.00                  

Prime Energy, et al Leasehold in Martin County, Tx

SEC

  BLK     TWP     SURVEY     ABSTR    

DESCRIPTION

 

LEASE NAME

  GR
ACS     PRIME
NET     PRIME
CONFIRMED
NET    

Formations for Value

 

Depth Confirmed

14

    36       T1N       T&P RR CO SVY       A0805     SE4   STRAIN 14     160    
  43.650704       43.64672     Spraberry and Dean (Part of WCA)   Contractually
limited to Base of Spra/Dean

19

    35       T1N       T&P RR CO SVY       A0050     W/2   STRAIN 19     320    
  87.301408       87.29344     Spraberry and Dean (Part of WCA)   Contractually
limited to Base of Spra/Dean

24

    36       T1N       T&P RR CO SVY       A0913     NW4   STRAIN 24     160    
  43.65072       43.64672     Spraberry and Dean (Part of WCA)   Contractually
limited to Base of Spra/Dean

29

    35       T1N       T&P RR CO SVY       A0055     N2 NW4   RAMSEY 29     80  
    19.3984056       22.1519608     Spraberry/Dean & Wolfcamp A   Surface to
8,600’

29

    35       T1N       T&P RR CO SVY       A0055     S2NW4   RAMSEY     80      
80       80     Spraberry/Dean & Wolfcamp A   Surface to 8550’—being the base of
the WCA

29

    35       T1N       T&P RR CO SVY       A0055     SW/4   HARLOW     160      
43.9276       40.3276     Spraberry and Dean (Part of WCA)   Surface to 8500’

30

    35       T1N       T&P RR CO SVY       A0627     W/2 SE/4   Heidelberg #1  
  80       37.215672       37.215672     Spraberry and Dean (Part of WCA)  
Surface to 8533’

30

    35       T1N       T&P RR CO SVY       A0627     S/2 SW/4   Heidelberg #2  
  80       27.535672       27.5356672     Spraberry and Dean (Part of WCA)  
Surface to 8545’

30

    35       T1N       T&P RR CO SVY       A0627     E/2 SE/4   Heidelberg #3  
  80       56.74461856       56.74461856     Spraberry and Dean (Part of WCA)  
Surface to 8533’

30

    35       T1N       T&P RR CO SVY       A0627     N/2 SW/4   Heidelberg #4  
  80       56.74461856       56.74461856     Spraberry/Dean & Wolfcamp A & B  
Surface to 9197’

30

    35       T1N       T&P RR CO SVY       A0627     S/2 NW/4   Heidelberg #5  
  80       56.74461856       56.74461856     Spraberry/Dean & Wolfcamp A & B  
Surface to 9198’

30

    35       T1N       T&P RR CO SVY       A0627     S/2 NE/4   Heidelberg #6  
  80       19.6716928       19.67176     Spraberry and Dean (Part of WCA)  
Surface to 8567’

30

    35       T1N       T&P RR CO SVY       A0627     N/2 NW/4   Heidelberg #7  
  80       8.16111024       8.1611104     Spraberry and Dean   Surface to 8470’

30

    35       T1N       T&P RR CO SVY       A0627     N/2 NE/4   Heidelberg #8  
  80       8.16111024       8.1611104     Spraberry and Dean   Surface to 8408’

31

    35       T1N       T&P RR CO SVY       A0056     E2NE4   NATHAN     80      
56.744616       56.744616     Spraberry and Dean (Part of WCA)   Surface to 8540

31

    35       T1N       T&P RR CO SVY       A0056     W2NE4   NATHAN     80      
80       80     Spraberry and Dean (Part of WCA)   Surface to 8567

39

    35       T1N       T&P RR CO SVY       A0060     S2SE4   ANDERSON     80    
  65.176392       65.1763848     Spraberry   Spraberry Dean Only

20

    36       T1S       T&P RR CO SVY       A0836     PT NE4 LYING NO OF IH20  
MARGIE BENTLEY     66.7       32.50007525       32.50007525     Spraberry/Dean &
Wolfcamp A   Surface to 8,800’

20

    36       T1S       T&P RR CO SVY       A0836     PT NE4 LYING NO OF IH20  
MARGIE BENTLEY     0       65.366       65.366     Wolfcamp B, Depths below
8,800   8,800’ & Below

6

    37       T1S       T&P RR CO SVY       A0752     SE4SW4   TENNECO-NAIL    
40       20       20     Spraberry/Dean & Wolfcamp A & B   All Depths

6

    37       T1S       T&P RR CO SVY       A0752     SW4SW4   NAIL-P 6     40  
    20       20     Spraberry/Dean & Wolfcamp A & B   All Depths

6

    37       T1S       T&P RR CO SVY       A0752     N2SW/4   NAIL-P 6     80  
    80       80     Spraberry/Dean & Wolfcamp A & B   All Depths

39

    37       T1N       T&P RR CO SVY       A0231     SW4   HASTING     160      
102.7       97.3666816     Spraberry and Dean   Spraberry Dean Only

46

    37       T1N       T&P RR CO SVY       A0933     S2SW4   WILLIAMS     80    
  66.024888       66.024888     Spraberry and Dean   Surface to 9041’

46

    37       T1N       T&P RR CO SVY       A1030     PT S2S2N2 & PT N2N2S2  
WILLIAMS     80       66.303424       66.303424     Spraberry and Dean   Surface
to 9333’

28

    38       T1N       T&P RR CO SVY       A0700     S2NW4   STIMSON-BURLEY    
80       40       40     Spraberry/Dean & Wolfcamp A & B   Below 9479’

28

    38       T1N       T&P RR CO SVY       A0700     S2NW4   STIMSON-BURLEY    
0       26.32       26.32     Spraberry/Dean & Part of WCA   Surface to 9479’

28

    38       T1N       T&P RR CO SVY       A0700     S2NE4   STIMSON-BURLEY    
80       66.24       66.24     Spraberry/Dean & Part of WCA   Surface to 9399’

28

    38       T1N       T&P RR CO SVY       A0700     S2SE4   STIMSON-BURLEY    
80       22.24       25.9918752     Spraberry/Dean & Part of WCA   Surface to
9216’

28

    38       T1N       T&P RR CO SVY       A0700     S2SE4   STIMSON-BURLEY    
0       40       40     Wolfcamp A & B   Wolfcamp A & B

31

    38       T1N       T&P RR CO SVY       A0284     S2SE4   GLASS 31 A     80  
    28.8       28.8     Spraberry/Dean Wolfcamp A  

31

    38       T1N       T&P RR CO SVY       A0284     S2NW4   GLASS 31 B     80  
    28.8       28.8     Spraberry/Dean Wolfcamp A  

38

    38       T1N       T&P RR CO SVY       A0754     SE4SE4   TENNECO-NAIL A    
40       9.48       9.48     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

38

    38       T1N       T&P RR CO SVY       A0754     SW4SE4   NAIL-P 38     40  
    9.48       9.48     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

1

    38       T1S       T&P RR CO SVY       A0291     NW4SE4   TENNECO-NAIL    
40       9.48       9.48     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

1

    38       T1S       T&P RR CO SVY       A0291     NE4SE4   NAIL-P 1     40  
    9.48       9.48     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

1

    38       T1S       T&P RR CO SVY       A0291     S2NE4   NAIL P 1A     80  
    18.96       18.96     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

1

    38       T1S       T&P RR CO SVY       A0291     S2SE4   NAIL P 1B     80  
    18.96       18.96     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

2

    38       T1S       T&P RR CO SVY       A0750     SE4SW4   BURLEY     40    
  9.48       9.48     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

2

    38       T1S       T&P RR CO SVY       A0705     SW4SW4   NAIL-P 2     40  
    9.48       9.48     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B

2

    38       T1S       T&P RR CO SVY       A0750     S2SE4   NAIL-P 2A     80  
    18.96       18.96     Spraberry/Dean & Wolfcamp A & B   Spraberry/Dean &
Wolfcamp A & B                 3266.7       1577.383271       1607.439561      
                    -30.05629077      

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

Defect Schedule

 

                                                             Archer (Includes
Wellbores)   Value per
acre      Updated
Value Per
Acre      Amount      Updated
Amount      PRIME WI      Confirmed
WI      PRIME
NRI      LEASE
NRI %     ORRI
%     Net Acres      Confirmed
Net Acres      ArcherWI      Confirmed
WI      Archer NRI   $ 18,375.00      $ 14,000.00      $ 802,081.69      $
611,054.08        0.272816900        0.272792000        0.204612675        75.00
%        8.949        8.93        0.055931250        0.055812500       
0.041948440   $ 18,375.00      $ 14,000.00      $ 1,604,163.37      $
1,222,108.16        0.272816900        0.272792000        0.204612675       
75.00 %        17.898        17.86        0.055931250        0.055812500       
0.041948440   $ 18,375.00      $ 14,000.00      $ 802,081.98      $ 611,054.08  
     0.272817000        0.272792000        0.204612750        75.00 %       
8.949        8.93        0.055931250        0.055812500        0.041948440   $
24,500.00      $ 24,500.00      $ 475,260.94      $ 542,723.04       
0.242480070        0.276899510        0.181860053        75.00 %              
   $ 24,500.00      $ 24,500.00      $ 1,960,000.00      $ 1,960,000.00       
1.000000000        1.000000000        0.780000000        78.00 %              
   $ 18,375.00      $ 18,375.00      $ 807,169.65      $ 741,019.65       
0.274547500        0.252047500        0.205910625        75.00 %              
   $ 18,375.00      $ 18,375.00      $ 683,837.97      $ 683,837.97       
0.465195900        0.465195900        0.346570946        74.50 %        6.08  
     6.08        0.076000000        0.076000000        0.056620000   $ 18,375.00
     $ 18,375.00      $ 505,967.97      $ 505,967.88        0.344195900       
0.344195840        0.256425946        74.50 %        6.08        6.08       
0.076000000        0.076000000        0.056620000   $ 18,375.00      $ 18,375.00
     $ 1,042,682.37      $ 1,042,682.37        0.709307732        0.709307732  
     0.528434260        74.50 %        3.40398736        3.40398736       
0.042549842        0.042549842        0.031699640   $ 35,000.00      $ 35,000.00
     $ 1,986,061.65      $ 1,986,061.65        0.709307732        0.709307732  
     0.528434260        74.50 %        3.40398736        3.40398736       
0.042549842        0.042549842        0.031699640   $ 35,000.00      $ 35,000.00
     $ 1,986,061.65      $ 1,986,061.65        0.709307732        0.709307732  
     0.528434260        74.50 %        3.40398736        3.40398736       
0.042549842        0.042549842        0.031699640   $ 18,375.00      $ 18,375.00
     $ 361,467.36      $ 361,468.59        0.245896160        0.245897000       
0.183192639        74.50 %        2.01500696        2.01500696       
0.025187587        0.025190000        0.018764750   $ 14,000.00      $ 14,000.00
     $ 114,255.54      $ 114,255.55        0.102013878        0.102013880       
0.076000339        74.50 %        4.92656984        4.92656984       
0.061582123        0.061582120        0.045878680   $ 14,000.00      $ 14,000.00
     $ 114,255.54      $ 114,255.55        0.102013878        0.102013880       
0.076000339        74.50 %        4.92656984        4.92656984       
0.061582123        0.061582120        0.045878680   $ 18,375.00      $ 18,375.00
     $ 1,042,682.32      $ 1,042,682.32        0.709307700        0.709307700  
     0.531980775        75.00 %        3.40398736        3.40398736       
0.042549842        0.042549842        0.031912380   $ 18,375.00      $ 18,375.00
     $ 1,470,000.00      $ 1,470,000.00        1.000000000        1.000000000  
     0.745000000        74.50 %                  $ 14,000.00      $ 14,000.00  
   $ 912,469.49      $ 912,469.39        0.814704900        0.814704810       
0.607281032        74.54 %                  $ 24,500.00      $ 24,500.00      $
796,251.84      $ 796,251.84        0.487257500        0.487257500       
0.384933425        79.00 %        4.752375        4.752375        0.071250000  
     0.071250000        0.056137500   $ 10,500.00      $ 10,500.00      $
686,343.00      $ 686,343.00        0.980000000        0.980000000       
0.757050000        77.25 %                  $ 26,000.00      $ 26,000.00      $
520,000.00      $ 520,000.00        0.500000000        0.500000000       
0.406250000        81.25 %      3.13 %                $ 26,000.00      $
26,000.00      $ 520,000.00      $ 520,000.00        0.500000000       
0.500000000        0.406250000        81.25 %      3.13 %                $
26,000.00      $ 26,000.00      $ 2,080,000.00      $ 2,080,000.00       
1.000000000        1.000000000        0.812500000        81.25 %      3.13 %   
            $ 10,400.00      $ 10,400.00      $ 1,068,080.00      $ 1,012,613.49
       0.641875000        0.608541760        0.500662500        78.00 %        
         $ 10,400.00      $ 10,400.00      $ 686,658.84      $ 686,658.84       
0.825311100        0.825311500        0.618983325        75.00 %              
   $ 10,400.00      $ 10,400.00      $ 689,555.61      $ 689,555.61       
0.828792800        0.828792500        0.621594600        75.00 %              
   $ 26,000.00      $ 26,000.00      $ 1,040,000.00      $ 1,040,000.00       
0.500000000        0.500000000        0.375000000        75.00 %              
   $ 13,650.00      $ 13,650.00      $ 359,268.00      $ 359,268.00       
0.829000000        0.829260080        0.621750000        75.00 %              
   $ 13,650.00      $ 13,650.00      $ 904,176.00      $ 904,176.00       
0.828000000        0.828454050        0.621000000        75.00 %              
   $ 13,650.00      $ 13,650.00      $ 303,576.00      $ 354,789.10       
0.278000000        0.324898440        0.208500000        75.00 %              
   $ 15,600.00      $ 15,600.00      $ 624,000.00      $ 624,000.00       
0.500000000        0.500000000        0.375000000        75.00 %              
   $ 18,200.00      $ 18,200.00      $ 524,160.00      $ 524,160.00       
0.360000000        0.360000000        0.270000000        75.00 %        1.9     
  1.9        0.023750000        0.023750000        0.017812500   $ 18,200.00  
   $ 18,200.00      $ 524,160.00      $ 524,160.00        0.360000000       
0.360000000        0.270000000        75.00 %        1.9        1.9       
0.023750000        0.023750000        0.017812500   $ 26,000.00      $ 26,000.00
     $ 246,480.00      $ 246,480.00        0.237000000        0.237000000       
0.192562500        81.25 %      1.48 %                $ 26,000.00      $
26,000.00      $ 246,480.00      $ 246,480.00        0.237000000       
0.237000000        0.192562500        81.25 %      1.48 %                $
26,000.00      $ 26,000.00      $ 246,480.00      $ 246,480.00       
0.237000000        0.237000000        0.192562500        81.25 %      1.48 %   
            $ 26,000.00      $ 26,000.00      $ 246,480.00      $ 246,480.00  
     0.237000000        0.237000000        0.192562500        81.25 %      1.48
%                $ 26,000.00      $ 26,000.00      $ 492,960.00      $
492,960.00        0.237000000        0.237000000        0.177750000        75.00
%                  $ 26,000.00      $ 26,000.00      $ 492,960.00      $
492,960.00        0.237000000        0.237000000        0.177750000        75.00
%                  $ 26,000.00      $ 26,000.00      $ 246,480.00      $
246,480.00        0.237000000        0.237000000        0.177750000        75.00
%                  $ 26,000.00      $ 26,000.00      $ 246,480.00      $
246,480.00        0.237000000        0.237000000        0.177750000        75.00
%                  $ 26,000.00      $ 26,000.00      $ 492,960.00      $
492,960.00        0.237000000        0.237000000        0.177750000        75.00
%                  $ 19,623.95         $ 30,954,488.77      $ 30,187,437.79     
               81.99247108        81.91647108              Grand Total:      $
38,121,181.22      $ 767,050.98        DEFECTS                           

 

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

Defect Schedule

 

                    Clint Hurt (Includes Wellbores)   Archer
Lease
NRI %     Amount      Updated
Amount      Net Acres      Confirmed
Net Acres      Clint Hurt
WI      Confirmed
WI      Clint Hurt
NRI      Clint Hurt
Lease
NRI %     Amount     75.0000 %    $ 164,437.88      $ 125,286.00        26.847  
     26.79        0.167793750        0.167437500        0.125845310       
75.0000 %    $ 493,313.63     75.0000 %    $ 328,875.75      $ 250,572.00       
53.694        53.58        0.167793750        0.167437500        0.125845310  
     75.0000 %    $ 986,627.25     75.0000 %    $ 164,437.88      $ 125,286.00  
     26.847        26.79        0.167793750        0.167437500       
0.125845310        75.0000 %    $ 493,313.63             4.130334       
8.260668        0.051629175        0.103258350        0.038721880        75.0000
%    $ 101,193.18                                      29.07        29.07       
0.181687500        0.181687500        0.136265620        75.0000 %    $
534,161.25     74.5000 %    $ 111,720.00      $ 111,720.00        18.24       
18.24        0.228000000        0.228000000        0.169860000        74.5000 % 
  $ 335,160.00     74.5000 %    $ 111,720.00      $ 111,720.00        18.24     
  18.24        0.228000000        0.228000000        0.169860000        74.5000
%    $ 335,160.00     74.5000 %    $ 62,548.27      $ 62,548.27       
10.21196208        10.21196208        0.127649526        0.127649526       
0.095098900        74.5000 %    $ 187,644.80     74.5000 %    $ 119,139.56     
$ 119,139.56        10.21196208        10.21196208        0.127649526       
0.127649526        0.095098890        74.5000 %    $ 357,418.67     74.5000 %   
$ 119,139.56      $ 119,139.56        10.21196208        10.21196208       
0.127649526        0.127649526        0.095098900        74.5000 %    $
357,418.67     74.5000 %    $ 37,025.75      $ 37,025.75        6.04502104     
  6.04502104        0.075562763        0.075563000        0.056294255       
74.5000 %    $ 111,077.26     74.5000 %    $ 68,971.98      $ 68,971.98       
14.77970952        14.77970952        0.184746369        0.184746370       
0.137636040        74.5000 %    $ 206,915.93     74.5000 %    $ 68,971.98      $
68,971.98        14.77970952        14.77970952        0.184746369       
0.184746370        0.137636040        74.5000 %    $ 206,915.93     75.0000 %   
$ 62,548.27      $ 62,548.27        10.21196208        10.21196208       
0.127649526        0.127649526        0.095737140        75.0000 %    $
187,644.80                                                       78.7895 %    $
133,066.50      $ 133,066.50        14.257125        14.257125       
0.213750000        0.213750000        0.168412500        78.7895 %    $
349,299.56                                                                     
                                                                                
                                                                              
                                 6.899964        6.899964        0.086249550  
     0.086249550        0.064687160        75.0000 %    $ 94,184.51             
                75.0000 %    $ 34,580.00      $ 34,580.00        5.7        5.7
       0.071250000        0.071250000        0.053437500        75.0000 %    $
103,740.00     75.0000 %    $ 34,580.00      $ 34,580.00        5.7        5.7  
     0.071250000        0.071250000        0.053437500        75.0000 %    $
103,740.00                                                                     
                                                                                
                                                                               $
1,621,763.36      $ 1,465,155.86        286.0777114        289.9800454        
        $ 5,544,929.08  

 

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

PSA Schedule 8 (e) (ii)—Contracts

Gas Contracts

 

  1. Casinghead Gas Contract dated September 26, 1983, between Brazos Petroleum
Company and Phillips Petroleum Company, filed of record in Volume 233, Page 748.

 

  2. Casinghead Gas Contract dated January 25, 1984, between Brazos Petroleum
Company and Phillips Petroleum Company, filed of record in Volume 239, Page 137.

 

  3. Amendatory Agreement dated April 30, 1984, between Brazos Petroleum Company
and Phillips Petroleum Company, filed of record in Volume 242, Page 436.

 

  4. Amendatory Agreement dated June 25, 1984, between Brazos Petroleum Company
and Phillips Petroleum Company, filed of record in Volume 245, Page 350.

 

  5. Casinghead Gas Contract dated November 11, 1984, between Brazos Petroleum
Company and Phillips Petroleum Company, filed of record in Volume 251, Page 451.

 

  6. Gas Purchase Contract dated February 1, 1985, between Brazos Petroleum
Company and Northern Gas Products Company, unrecorded.

 

  7. Casinghead Gas Contract dated April 1, 1985, between James B. Lewis Land &
Oil Co., Seller, and Northern Gas Products Company, Buyer, unrecorded.

 

  8. Casinghead Gas Contract dated April 3, 1985, between The Superior Oil
Company and Phillips Petroleum Company, filed of record in Volume 257, Page 725.

 

  9. Casinghead Gas Contract dated February 11, 1986, between Brazos Petroleum
Company and Phillips 66 Natural Gas Company, filed of record in Volume 270, Page
712.

 

  10. Gas Purchase Contract dated February 1, 1994, between Prime Operating
Company and GPM Gas Corporation, a Memorandum of which is recorded in Volume 41,
Page 181.

 

  11. Gas Purchase Contract dated September 20, 1999, between Prime Operating
Company and GPM Gas Corporation (BEN 0478-00R)

 

  12. Amendment to Gas Purchase Contract dated January 1, 2002, between Prime
Operating Company and Duke Energy Field Services, LP (BEN047800R)

 

  13. Amendment to Gas Purchase Contract dated September 1, 2005, between Prime
Operating Company and Duke Energy Field Services, LP (BEN047800R)

 

  14. Amendment to Gas Purchase Contract dated January 28, 2009, effective
December 1, 2008, between Prime Operating Company and DCP Midstream, LP (BEN
0478-00R)

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

  15. Amendment to Gas Purchase Contract dated effective October 1, 2013,
between Prime Operating Company and DCP Midstream, LP (BEN 0478-00R)

 

  16. Gas Purchase Contract dated May 09, 2006 between Prime Operating Company
and WTG Gas Processing (41-00033-20060509 GPC)

 

  17. Gas Purchase Contract dated December 17, 2010 between Endeavor Energy
Resources, L.P., and WTG Gas Processing, L.P. (40-00074 GPC)

 

  18. Amendment to Gas Purchase Contract dated January 20, 2011 between Endeavor
Energy Resources, L.P., and WTG Gas Processing, L.P. (40-00074 GPC)

 

  19. Amendment to Gas Purchase Contract dated February 06, 2012 between
Endeavor Energy Resources, L.P., and WTG Gas Processing, L.P. (40-00074 GPC)

 

  20. Amendment to Gas Purchase Contract dated February 06, 2012 between
Endeavor Energy Resources, L.P., and WTG Gas Processing, L.P. (40-00074 GPC)

 

  21. Amendment to Gas Purchase Contract dated May 04, 2012 between Endeavor
Energy Resources, L.P., and WTG Gas Processing, L.P. (40-00074 GPC)

 

  22. Amendment to Gas Purchase Contract dated March 25, 2013 between Endeavor
Energy Resources, L.P., and WTG Gas Processing, L.P. (40-00074 GPC)

 

  23. Gas Purchase Contract dated October 01, 2013 between Endeavor Energy
Resources, L.P., and WTG Gas Processing (41-2013-22 GPC)

 

  24. Amendment to Gas Purchase Contract dated July 15, 2014 between Endeavor
Energy Resources, L.P., and WTG Gas Processing, L.P. (41-2013-22 GPC)

 

  25. Amendment to Gas Purchase Contract dated November 15, 2014 between
Endeavor Energy Resources, L.P., and WTG Gas Processing, L.P. (41-2013-22 GPC)

Agreements:

 

  26. Trade Letter Agreement dated May 12, 1983, by and between Exxon Company,
U.S.A. and Palomino Oil Company, and Amendments dated August 29, 1983 with
Palomino Oil Co., and Amendments dated August 29 and 30, 1983 with Brazos
Petroleum Company.

 

  27. Farmout Letter dated June 29, 1983, by and between Palomino Oil Co. and
Brazos Petroleum Company.

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

  28. Operating Agreement dated August 22, 1983, between Lewis & Atkins Oil &
Gas, Inc., Operator, and Hasting Prospect Working Interest Owners, Non-Operators
(Hasting)

 

  29. Operating Agreement dated September 8, 1983, between Brazos Petroleum
Company, Operator, and Saturn Energy Company, et al, Non-Operators (Margie
Bentley)

 

  30. Tangent Drilling Program (1984-2) Limited Partnership Agreement.

 

  31. Tangent Drilling Program (1984-3) Limited Partnership Agreement.

 

  32. Farmout Contract Agreement, by and between Amoco Production Company and
The Superior Oil Company, dated January 13, 1984.

 

  33. Joint Venture Agreement for Spraberry Development 1984 Joint Venture and
Brazos 1984-A Participation and Nominee Agreement, both dated May 1, 1984.

 

  34. Operating Agreement dated September 4, 1984, by and between Brazos
Petroleum Company, Operator, and Clint Hurt & Associates, Inc., et al, as
Non-Operators.

 

  35. Farmout Operating Agreement, by and between The Superior Oil Company and
Brazos Petroleum Company, dated August 10, 1984, as amended October 29, 1984.

 

  36. Farmout Agreement dated October 31, 1984, by and between Texaco, Inc. and
James B. Lewis Land & Oil Co.

 

  37. Operating Agreement dated November 1, 1984, between Brazos Petroleum
Company, Operator, and Clint Hurt & Associates, et al, Non-Operators (Strain,
Harlow)

 

  38. Operating Agreement dated March 9, 1985, between Brazos Petroleum Company,
Operator, and Brazos 1984-N, LTD., et al, Non-Operators (Heidelberg)

 

  39. Joint Venture Agreement dated December 18, 1984, by and between Brazos
Petroleum Company and Harbour Energy, Ltd.

 

  40. Operating Agreement dated May 8, 1985, by and between Brazos Petroleum
Company, Operator, and Brazos 1984-B, Ltd., et al, Non-Operators (Stimson-Burley
and N/2 SW/4 Section 28)

 

  41. Letter Agreement dated June 28, 1985, by and between Brazos Petroleum
Company and LSSCO Trading Company, Inc.

 

  42. Operating Agreement dated July 1, 1985, between Brazos Petroleum Company,
Operator, and David Meyer, et al, Non-Operators (Heidelberg, Nathan)

 

  43. Operating Agreement dated July 10, 1985, between James B. Lewis Land & Oil
Co, Operator, and Glass Prospect, Phase I Working Interest Owners, Non-Operators
(Glass)

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

  44. Letter Agreement dated December 12, 1985, by and between Brazos Petroleum
Company and Tangent Oil & Gas, Inc.

 

  45. Turnkey Agreement dated December 17, 1985, and amended December 17, 1985,
between Brazos Petroleum Company and Tangent Oil & Gas, Inc.

 

  46. Operating Agreement dated February 26, 1986, by and between Brazos
Petroleum Company and Tangent Oil & Gas, Inc.

 

  47. Operating Agreement dated March 19, 1986, by and between Brazos Petroleum
Company, Operator, and Melba Davis Whately, et al, Non-Operators
(Stimson-Burley)

 

  48. Letter Agreement re: amendment to Strain Ranch Prospect JOA dated
January 9, 1987, between Brazos Petroleum Company, and Brazos 1984-A Joint
Venture, et al. (Strain)

 

  49. Letter Agreement dated August 26, 2011, between PrimeEnergy Corporation
and Endeavor Energy Resources, LP (Tenneco Nail JV)

 

  50. Letter Agreement dated February 13, 2012, between PrimeEnergy Corporation
and Endeavor Energy Resources, LP (Nail Ranch JV)

 

  51. Letter Agreement dated September 10, 2015, between PrimeEnergy Corporation
and Endeavor Energy Resources, LP, (Nail Area)

END OF SCHEDULE

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

PSA Schedule 8 (n) (i)—Expenses

NONE.

END OF SCHEDULE

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

Schedule 3

Excluded Wellbores

 

API#

  

Well Name

  

Well#

  

Operator

  

Section

  

BLK

  

TWP

  

Survey

  

Abstract

  

County

  

State

42-317-33325

   ANDERSON    1    PRIME OPERATING COMPANY    39    35    T1N    T&P RR CO SVY
   A0060    Martin    Texas

42-317-32720

   BENTLEY, MARGIE    1    PRIME OPERATING COMPANY    20    36    T1S    T&P RR
CO SVY    A0836    Martin    Texas

42-317-33203

   BURLEY    3    PRIME OPERATING COMPANY    2    38    T1S    T&P RR CO SVY   
A0750    Martin    Texas

42-317-33216

   GLASS 31 “B”    4    PRIME OPERATING COMPANY    31    38    T1N    T&P RR CO
SVY    A0284    Martin    Texas

42-317-33210

   GLASS 31 -A-    3    PRIME OPERATING COMPANY    31    38    T1N    T&P RR CO
SVY    A0284    Martin    Texas

42-317-33208

   GLASS 31 -A-    1    PRIME OPERATING COMPANY    31    38    T1N    T&P RR CO
SVY    A0284    Martin    Texas

42-317-32995

   HARLOW    2    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO SVY   
A0055    Martin    Texas

42-317-32996

   HARLOW    1    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO SVY   
A0055    Martin    Texas

42-317-32748

   HASTING    1    PRIME OPERATING COMPANY    39    37    T1N    T&P RR CO SVY
   A0231    Martin    Texas

42-317-32948

   HEIDELBERG    8    PRIME OPERATING COMPANY    30    35    T1N    T&P RR CO
SVY    A0627    Martin    Texas

42-317-32949

   HEIDELBERG    7    PRIME OPERATING COMPANY    30    35    T1N    T&P RR CO
SVY    A0627    Martin    Texas

42-317-33116

   HEIDELBERG    6    PRIME OPERATING COMPANY    30    35    T1N    T&P RR CO
SVY    A0627    Martin    Texas

42-317-33166

   HEIDELBERG    4    PRIME OPERATING COMPANY    30    35    T1N    T&P RR CO
SVY    A0627    Martin    Texas

42-317-33165

   HEIDELBERG    5    PRIME OPERATING COMPANY    30    35    T1N    T&P RR CO
SVY    A0627    Martin    Texas

42-317-32788

   HEIDELBERG    1    PRIME OPERATING COMPANY    30    35    T1N    T&P RR CO
SVY    A0627    Martin    Texas

42-317-38764

   HEIDELBERG A    1    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO
SVY    A0055    Martin    Texas

42-317-38811

   HEIDELBERG A    2    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO
SVY    A0055    Martin    Texas

42-317-37426

   NAIL -P- ‘1’    1    PRIME OPERATING COMPANY    1    38    T1S    T&P RR CO
SVY    A0291    Martin    Texas

42-317-38133

   NAIL -P- ‘2’    1    PRIME OPERATING COMPANY    2    38    T1S    T&P RR CO
SVY    A0705    Martin    Texas

42-317-37664

   NAIL -P- ‘38’    1    PRIME OPERATING COMPANY    38    38    T1N    T&P RR CO
SVY    A0754    Martin    Texas

42-317-37465

   NAIL -P- ‘6’    1    PRIME OPERATING COMPANY    6    37    T1N    T&P RR CO
SVY    A0752    Martin    Texas

42-317-39488

   NAIL-P ‘1A’    1    PRIME OPERATING COMPANY    1    38    T1S    T&P RR CO
SVY    A0291    Martin    Texas

42-317-39489

   NAIL-P ‘1B’    1    PRIME OPERATING COMPANY    1    38    T1S    T&P RR CO
SVY    A0291    Martin    Texas

42-317-39496

   NAIL-P ‘2A’    1    PRIME OPERATING COMPANY    2    38    T1S    T&P RR CO
SVY    A0705    Martin    Texas

42-317-33164

   NATHAN    4    PRIME OPERATING COMPANY    31    35    T1N    T&P RR CO SVY   
A0056    Martin    Texas

42-317-32905

   RAMSEY    1    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO SVY   
A0055    Martin    Texas

42-317-37736

   RAMSEY ‘29A’    1    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO
SVY    A0055    Martin    Texas

42-317-38152

   RAMSEY ‘29B’    1    PRIME OPERATING COMPANY    29    35    T1N    T&P RR CO
SVY    A0055    Martin    Texas

42-317-33121

   STIMSON-BURLEY    2802    PRIME OPERATING COMPANY    28    38    T1N    T&P
RR CO SVY    A0700    Martin    Texas

42-317-39193

   STIMSON-BURLEY    2803    PRIME OPERATING COMPANY    28    38    T1N    T&P
RR CO SVY    A0700    Martin    Texas

42-317-33331

   STIMSON-BURLEY -A-    2    PRIME OPERATING COMPANY    28    38    T1N    T&P
RR CO SVY    A0700    Martin    Texas

42-317-33330

   STIMSON-BURLEY -A-    1    PRIME OPERATING COMPANY    28    38    T1N    T&P
RR CO SVY    A0700    Martin    Texas

42-317-39972

   STIMSON-BURLEY -A-    4    PRIME OPERATING COMPANY    28    38    T1N    T&P
RR CO SVY    A0700    Martin    Texas

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

Schedule 3

Excluded Wellbores

 

42-317-33006

   STRAIN “14”    1    PRIME OPERATING COMPANY    14    36    T1N   
T&P RR CO SVY    A0805    Martin    Texas

42-317-33001

   STRAIN “19”    1    PRIME OPERATING COMPANY    19    35    T1N    T&P RR CO
SVY    A0050    Martin    Texas

42-317-33068

   STRAIN “19”    2    PRIME OPERATING COMPANY    19    35    T1N    T&P RR CO
SVY    A0050    Martin    Texas

42-317-33067

   STRAIN “19”    4    PRIME OPERATING COMPANY    19    35    T1N    T&P RR CO
SVY    A0050    Martin    Texas

42-317-33083

   TENNECO-NAIL    102    PRIME OPERATING COMPANY    1    38    T1S    T&P RR CO
SVY    A0291    Martin    Texas

42-317-33104

   TENNECO-NAIL    602    PRIME OPERATING COMPANY    6    37    T1N    T&P RR CO
SVY    A0752    Martin    Texas

42-317-33099

   TENNECO-NAIL -A-    3801    PRIME OPERATING COMPANY    38    38    T1N    T&P
RR CO SVY    A0754    Martin    Texas

42-317-33301

   WILLIAMS    1    PRIME OPERATING COMPANY    46    37    T1N    T&P RR CO SVY
   A0933    Martin    Texas

42-317-33350

   WILLIAMS    2    PRIME OPERATING COMPANY    46    37    T1N    T&P RR CO SVY
   A0933    Martin    Texas

End of Schedule 3—Excluded Wellbores

 

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

Schedule 8 (i)

 

Lessor

   Lessee    Lease
Executed
Date    Lease
Recorded
Date    County    Section    Block    Survey    Tract    Lease
Vol/Pg    Attributable
Net Acres
PRIMENERGY    Price Per
Acre      Allocated
Lease
Value  

Exchange Oil & Gas Corporation

   The Superior Oil Company    10/5/1983    11/16/1983    Martin    19    35 T1N
   T&P Ry. Co. Sy.    W/2    234/233    22.4650    $ 14,000.00      $ 314,510.00
 

Exchange Oil & Gas Corporation

   The Superior Oil Company    10/5/1983    11/16/1983    Martin    14    36 T1N
   T&P Ry. Co. Sy.    SE/4    234/229    7.8300    $ 14,000.00      $ 109,620.00
              Martin    24    36 T1N    T&P Ry. Co. Sy.    NW/4       8.1838   
$ 14,000.00      $ 114,572.65  

Burley Revocable Living Trust

   PrimeEnergy Corporation    9/17/2012    11/5/2012    Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 SE/4    356/106    1.6919192    $ 13,650.00      $
23,094.70               Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4   
   1.6919192    $ 13,650.00      $ 23,094.70               Martin    28    38
T1N    T&P Ry. Co. Sy.    S/2 NW/4       1.6919192    $ 26,000.00      $
43,989.90  

Ronald J. Nail Revocable Trust, et al

   PrimeEnergy Corporation    7/26/2012    11/5/2012    Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 SE/4    356/112    30.0051296    $ 13,650.00      $
409,570.02               Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4
      30.0051296    $ 13,650.00      $ 409,570.02               Martin    28   
38 T1N    T&P Ry. Co. Sy.    S/2 NW/4       30.0051296    $ 26,000.00      $
780,133.37  

J.H.B. Oil & Gas Company, LLC

   PrimeEnergy Corporation    11/8/2012    1/2/2013    Martin    28    38 T1N   
T&P Ry. Co. Sy.    S/2 SE/4    361/662    1.6919192    $ 13,650.00      $
23,094.70               Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4   
   1.6919192    $ 13,650.00      $ 23,094.70               Martin    28    38
T1N    T&P Ry. Co. Sy.    S/2 NW/4       1.6919192    $ 26,000.00      $
43,989.90  

The Flex Family Trust

   PrimeEnergy Corporation    3/15/2013    1/17/2014    Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 SE/4    398/82    0.5555556    $ 13,650.00      $
7,583.33               Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4   
   0.5555556    $ 13,650.00      $ 7,583.33               Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 NW/4       0.5555556    $ 26,000.00      $ 14,444.45  

Stimson Energy Trust

   PrimeEnergy Corporation    3/15/2013    1/17/2014    Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 SE/4    398/88    0.5555556    $ 13,650.00      $
7,583.33               Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4   
   0.5555556    $ 13,650.00      $ 7,583.33               Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 NW/4       0.5555556    $ 26,000.00      $ 14,444.45  

Morris Jerome Stimson GST Exempt Trust

   PrimeEnergy Corporation    3/15/2013    1/17/2014    Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 SE/4    398/92    0.5555556    $ 13,650.00      $
7,583.33               Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4   
   0.5555556    $ 13,650.00      $ 7,583.33               Martin    28    38 T1N
   T&P Ry. Co. Sy.    S/2 NW/4       0.5555556    $ 26,000.00      $ 14,444.45  

JP Morgan Chase Bank, Trustee

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/554    3.380536869    $ 26,000.00      $
87,893.96  

Ronald J. Nail Revocable Trust, et al

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/557    3.380536869    $ 26,000.00      $
87,893.96  

Mallard Royalty Partners

   PrimeEnergy Corporation    12/20/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/563    0.431874749    $ 26,000.00      $
11,228.74  

Mallard Royalty Partners

   PrimeEnergy Corporation    12/20/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/566    0.431874749    $ 26,000.00      $
11,228.74  

Burley Revocable Living Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/572    0.803137125    $ 26,000.00      $
20,881.57  

Burley Revocable Living Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/575    0.803137125    $ 26,000.00      $
20,881.57  

J.H.B. Oil and Gas Company, LLC

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/581    0.803137125    $ 26,000.00      $
20,881.57  

J.H.B. Oil and Gas Company, LLC

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/584    0.803137125    $ 26,000.00      $
20,881.57  

Sharon Lynn Gilbert GST Exempt Trust
and the Sharon Lynn Gilbert Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/590    1.082793362    $ 26,000.00      $
28,152.63  

Sharon Lynn Gilbert GST Exempt Trust
and the Sharon Lynn Gilbert Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/593    1.082793362    $ 26,000.00      $
28,152.63  

Dennis Barrie Stimson GST Exempt Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/599    0.541396681    $ 26,000.00      $
14,076.31  

Dennis Barrie Stimson GST Exempt Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/602    0.541396681    $ 26,000.00      $
14,076.31  

Morris Jerome Stimson GST Exempt Trust
and Stimson Energy Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/608    0.541396681    $ 26,000.00      $
14,076.31  

Morris Jerome Stimson GST Exempt Trust
and Stimson Energy Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    1    38 T1S   
T&P Ry. Co. Sy.    S/2 NE/4    330/611    0.541396681    $ 26,000.00      $
14,076.31  

Ronald J. Nail Revocable Trust, et al

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/560    14.24313497    $ 26,000.00      $
370,321.51  

Mallard Royalty Partners

   PrimeEnergy Corporation    12/20/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/569    1.819607531    $ 26,000.00      $
47,309.80  

Burley Revocable Living Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/578    0.803137125    $ 26,000.00      $
20,881.57  

J.H.B. Oil and Gas Company, LLC

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/587    0.803137125    $ 26,000.00      $
20,881.57  

Sharon Lynn Gilbert GST Exempt Trust
and the Sharon Lynn Gilbert Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/596    0.527433376    $ 26,000.00      $
13,713.27  

Dennis Barrie Stimson GST Exempt Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/605    0.263716688    $ 26,000.00      $
6,856.63  

Morris Jerome Stimson GST Exempt Trust
and Stimson Energy Trust

   PrimeEnergy Corporation    9/1/2011    3/7/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    S/2 SE/4    330/614    0.263716688    $ 26,000.00      $
6,856.63  

Ronald J. Nail Revocable Trust, et al

   PrimeEnergy Corporation    1/4/2012    3/20/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    SE/4 SW/4    331/509    7.121567485    $ 26,000.00      $
185,160.75               Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4
      7.121567485    $ 26,000.00      $ 185,160.75  

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

Burley Revocable Living Trust

   PrimeEnergy
Corporation    9/17/2012    11/5/2012    Martin    2    38 T1S   
T&P Ry. Co. Sy.    SE/4 SW/4    356/109    0.401568563    $ 26,000.00      $
10,440.78               Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4   
   0.401568563    $ 26,000.00      $ 10,440.78  

J.H.B. Oil and Gas Company, LLC

   PrimeEnergy
Corporation    11/8/2012    1/2/2013    Martin    2    38 T1S    T&P Ry. Co. Sy.
   SE/4 SW/4    361/670    0.803137125    $ 26,000.00      $ 20,881.57        
      Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4       0.803137125   
$ 26,000.00      $ 20,881.57  

Flex Family Trust

   PrimeEnergy
Corporation    11/15/2013    1/17/2014    Martin    2    38 T1S    T&P Ry. Co.
Sy.    SE/4 SW/4    398/84    0.131858344    $ 26,000.00      $ 3,428.32        
      Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4       0.131858344   
$ 26,000.00      $ 3,428.32  

Morris Jerome Stimson GST Exempt Trust

   PrimeEnergy
Corporation    3/15/2013    1/17/2014    Martin    2    38 T1S    T&P Ry. Co.
Sy.    SE/4 SW/4    398/86    0.131858344    $ 26,000.00      $ 3,428.32        
      Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4       0.131858344   
$ 26,000.00      $ 3,428.32  

The Stimson Energy Trust

   PrimeEnergy
Corporation    3/15/2013    1/17/2014    Martin    2    38 T1S    T&P Ry. Co.
Sy.    SE/4 SW/4    398/90    0.131858344    $ 26,000.00      $ 3,428.32        
      Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4       0.131858344   
$ 26,000.00      $ 3,428.32  

Mallard Royalty Partners

   PrimeEnergy
Corporation    12/1/2013    3/7/2014    Martin    2    38 T1S    T&P Ry. Co. Sy.
   SE/4 SW/4    403/425    0.909803766    $ 26,000.00      $ 23,654.90        
      Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4       0.909803766   
$ 26,000.00      $ 23,654.90               Martin    28    38 T1N    T&P Ry. Co.
Sy.    S/2 SE/4       3.8332544    $ 13,650.00      $ 52,323.92              
Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4       3.8332544    $
13,650.00      $ 52,323.92               Martin    28    38 T1N    T&P Ry. Co.
Sy.    S/2 NW/4       3.8332544    $ 26,000.00      $ 99,664.61  

Sharon Lynn Gilbert, Individually and
Sharon Lynn Gilbert GST Exempt Trust

   PrimeEnergy
Corporation    2/27/2014    4/16/2014    Martin    2    38 T1S    T&P Ry. Co.
Sy.    SE/4 SW/4    407/67    0.263716688    $ 26,000.00      $ 6,856.63        
      Martin    2    38 T1S    T&P Ry. Co. Sy.    SW/4 SW/4       0.263716688   
$ 26,000.00      $ 6,856.63               Martin    28    38 T1N    T&P Ry. Co.
Sy.    S/2 SE/4       1.11111    $ 13,650.00      $ 15,166.65              
Martin    28    38 T1N    T&P Ry. Co. Sy.    S/2 NE/4       1.11111    $
13,650.00      $ 15,166.65               Martin    28    38 T1N    T&P Ry. Co.
Sy.    S/2 NW/4       1.11111    $ 26,000.00      $ 28,888.86                 
                    TOTAL      $ 4,066,464.92