Exhibit 10.7

PURCHASE AND SALE AGREEMENT
BY AND AMONG
MID-CON ENERGY PROPERTIES, LLC
MID-CON ENERGY OPERATING, LLC
AS SELLER
AND
PO&G PANHANDLE, LP
AS PURCHASER
Executed on May 26, 2016

 
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TABLE OF CONTENTS
Page

SECTION 1.1 PURCHASE AND
SALE..........................................................................9
Section 1.2
Assets.........................................................................................9

Section 1.3
Excluded
Assets.......................................................................12

Section 1.4
Effective Time; Proration of Costs and Revenues...................13

Section 1.5
Delivery and Maintenance of Records....................................14

ARTICLE 2 PURCHASE
PRICE.....................................................................................15
Section 2.1
Purchase
Price.........................................................................15

Section 2.2
Adjustments to Purchase Price................................................15

Section 2.3
Deposit....................................................................................17

Section 2.4
Allocated
Values.....................................................................17

ARTICLE 3 TITLE
MATTERS.......................................................................................17
Section 3.1
Seller’s
Title...........................................................................17

Section 3.2
Definition of Defensible Title................................................18

Section 3.3
Definition of Permitted Encumbrances..................................19

Section 3.4
Notice of Title Defect Adjustments........................................21

Section 3.5
Casualty or Condemnation Loss.............................................25

Section 3.6
Limitations on
Applicability....................................................25

ARTICLE 4 ENVIRONMENTAL
MATTERS.................................................................26
Section 4.1
Assessment..............................................................................26

Section 4.2
NORM, Wastes and Other Substances....................................27

Section 4.3
Environmental
Defects............................................................27

Section 4.4
Inspection
Indemnity...............................................................29

Section 4.5
Exclusive
Remedy...................................................................29

ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF SELLER........................29
Section 5.1
Generally.................................................................................30

Section 5.2
Existence and
Qualification....................................................30

Section 5.3
Power......................................................................................30

Section 5.4
Authorization and Enforceability...........................................30

Section 5.5
No
Conflicts...........................................................................30

Section 5.6
Liability for Brokers’
Fees.....................................................31

Section 5.7
Litigation................................................................................31

Section 5.8
Taxes and
Assessments...........................................................31

Section 5.9
Compliance with
Laws...........................................................31

Section 5.10
Outstanding Capital Commitments........................................32

Section 5.11
Imbalances..............................................................................32

Section 5.12
Bankruptcy..............................................................................32

 
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TABLE OF CONTENTS
Page

Section 5.13
Transfer
Requirements............................................................32

Section 5.14
Preference
Rights....................................................................32

Section 5.15
Payment of
Royalties..............................................................32

Section 5.16
Oil and Gas
Operations...........................................................32

Section 5.17
Well Status; Plugging and Abandonment................................33

Section 5.18
Non-Consent
Operations.........................................................33

Section 5.19
Permits.....................................................................................33

Section 5.20
Tax
Partnership........................................................................33

Section 5.21
Suspense
Accounts..................................................................34

Section 5.22
Insurance;
Bonding.................................................................34

Section 5.23
Material
Contracts...................................................................34

Section 5.24
Environmental
Matters............................................................34

Section 5.25
Mortgages and Other Instruments...........................................35

Section 5.26
Payments for Hydrocarbon Production...................................36

Section 5.27
Payout
Balances......................................................................36

Section 5.28
Hedging...................................................................................36

ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF PURCHASER...............36
Section 6.1
Existence and
Qualification....................................................36

Section 6.2
Power.......................................................................................36

Section 6.3
Authorization and Enforceability............................................36

Section 6.4
No
Conflicts............................................................................37

Section 6.5
Liability for Brokers’
Fees......................................................37

Section 6.6
Litigation................................................................................37

Section 6.7
Financing................................................................................37

Section 6.8
Limitation...............................................................................37

Section 6.9
SEC
Disclosure......................................................................37

Section 6.10
Bankruptcy.............................................................................38

Section 6.11
Qualification..........................................................................38

Section 6.12
Consents................................................................................38

Section 6.13
Independent
Evaluation.........................................................38

ARTICLE 7 COVENANTS OF THE
PARTIES.............................................................39
Section 7.1
Government Reviews............................................................39

Section 7.2
Notification of
Breaches.......................................................39

Section 7.3
Letters-in-Lieu; Assignments; Operatorship.........................40

Section 7.4
Public Announcements..........................................................40

Section 7.5
Operation of
Business...........................................................40

Section 7.6
Transfer
Requirements..........................................................41

Section 7.7
Tax
Matters...........................................................................42

Section 7.8
Further
Assurances...............................................................42

Section 7.9
Insurance..............................................................................43

Section 7.10
Record
Retention.................................................................43

 
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Section 7.11
Bonds, Letters of Credit and Guarantees.................................43

Section 7.12
Cure of
Misrepresentations......................................................43

Section 7.13
Plugging, Abandonment, Decommissioning and Other Costs.44

Section 7.14
Employees................................................................................44

Section 7.15
Satisfaction of
Conditions........................................................44

ARTICLE 8 CONDITIONS TO
CLOSING......................................................................44
Section 8.1
Conditions of Seller to
Closing................................................44

Section 8.2
Conditions of Purchaser to Closing.........................................46

ARTICLE 9
CLOSING......................................................................................................47
Section 9.1
Time and Place of
Closing.......................................................47

Section 9.2
Obligations of Seller at
Closing...............................................47

Section 9.3
Obligations of Purchaser at Closing........................................48

Section 9.4
Closing Adjustments and Closing Payment.............................49

ARTICLE 10
TERMINATION..........................................................................................51
Section 10.1
Termination..............................................................................51

Section 10.2
Effect of
Termination...............................................................52

Section 10.3
Distribution of Deposit Upon Termination..............................52

ARTICLE 11 POST-CLOSING OBLIGATIONS; INDEMNIFICATION;
LIMITATIONS; DISCLAIMERS AND
WAIVERS..........................................................53
Section 11.1
Assumed Seller
Obligations.....................................................53

Section 11.2
Survival....................................................................................54

Section 11.3
Indemnification by
Seller.........................................................55

Section 11.4
Indemnification by Purchaser..................................................55

Section 11.5
Indemnification Proceedings...................................................56

Section 11.6
Release.....................................................................................58

Section 11.7
Disclaimers..............................................................................58

Section 11.8
Waiver of Trade Practices Acts................................................60

Section 11.9
Redhibition
Waiver..................................................................60

Section 11.10
Recording.................................................................................61

Section 11.11
Non-Compensatory Damages..................................................61

Section 11.12
Disclaimer of Application of Anti-Indemnity Statutes............61

ARTICLE 12
MISCELLANEOUS....................................................................................61
Section 12.1
Counterparts.............................................................................61

Section 12.2
Notices.....................................................................................62

 
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Section 12.3
Sales or Use Tax Recording Fees and Similar Taxes and Fees..62

Section 12.4
Exhibits and
Schedules............................................................62

Section 12.5
Expenses..................................................................................63

Section 12.6
Change of
Name......................................................................63

Section 12.7
Governing Law; Venue; and Waiver of Jury Trial...................63

Section 12.8
Captions...................................................................................64

Section 12.9
Waivers....................................................................................64

Section 12.10
Assignment..............................................................................64

Section 12.11
Entire
Agreement.....................................................................64

Section 12.12
Amendment.............................................................................64

Section 12.13
No Third-Party Beneficiaries..................................................64

Section 12.14
References...............................................................................65

Section 12.15
Construction............................................................................65

Section 12.16
Conspicuousness.....................................................................65

Section 12.17
Severability.............................................................................66

Section 12.18
Time of
Essence......................................................................66

 
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EXHIBITS
Exhibit A
Leases

Exhibit A-1
Wells and Units

Exhibit A-2
Working Interests and Net Revenue Interests

Exhibit B
Form of Assignment, Conveyance and Bill of Sale

Exhibit C
Form of Title Indemnity Agreement

SCHEDULES
Schedule 1.2(d)
Contracts

Schedule 1.2(e)
Easements

Schedule 1.2(k)
Vehicles and Vessels

Schedule 1.3(e)
Excluded Assets

Schedule 3.3(l)
Permitted Encumbrances

Schedule 3.4(a)
Allocated Values

Schedule 5.7
Litigation

Schedule 5.8
Taxes and Assessments

Schedule 5.9
Compliance with Laws

Schedule 5.10
Outstanding Capital Commitments

Schedule 5.11
Imbalances

Schedule 5.13
Transfer Requirements

Schedule 5.16
Oil and Gas Operations

Schedule 5.17
Plugging and Abandonment

Schedule 5.21
Suspense Accounts

Schedule 5.22
Insurance; Bonding

Schedule 5.23
Material Contracts

Schedule 5.24
Environmental Matters

Schedule 7.5
Operation of Business

Schedule 7.14
Employees

 
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DEFINITIONS
“Adjustment Period” means the period beginning at the Effective Time and ending
on the Closing Date.
“Adjusted Purchase Price” shall mean the Purchase Price after calculating and
applying the adjustments set forth in Section 2.2.
“AFE” means authority for expenditure.
“Affiliates” with respect to any Person, means any Person that directly or
indirectly controls, is controlled by or is under common control with such
Person. The concept of control, controlling or controlled as used in the
aforesaid context means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of another, whether
through the ownership of voting securities, by contract or otherwise. No Person
shall be deemed an Affiliate of any Person by reason of the exercise or
existence of rights, interests or remedies under this Agreement.
“Agreed Accounting Firm” has the meaning set forth in Section 9.4(c).
“Agreed Interest Rate” means the rate of interest published in the Wall Street
Journal from time to time, as the one month London Interbank Offered Rate
(LIBOR) plus 250 basis points, with adjustments in that rate to be made on the
same day as any change in that rate.
“Agreement” has the meaning set forth in the preamble hereto.
“Allocated Value” has the meaning set forth in Section 3.4(a).
“Applicable Contracts” means all Contracts by which the Properties and other
Assets are bound or that primarily relate to the Properties or other Assets and
(in each case) that will be binding on the Assets or Purchaser after the
Closing, including, without limitation; farmin and farmout agreements;
bottomhole agreements; crude oil, condensate and natural gas purchase and sale,
gathering, transportation and marketing agreements; hydrocarbon storage
agreements; acreage contribution agreements; operating agreements; balancing
agreements; pooling declarations or agreements; unitization agreements;
processing agreements; saltwater disposal agreements; facilities or equipment
leases; crossing agreements; letters of no objection; platform use agreements;
production handling agreements; and other similar contracts and agreements, of
Seller and primarily related to the Properties or other Assets, but exclusive of
any master service agreements.
“Assessment” has the meaning set forth in Section 4.1(b).
“Assets” has the meaning set forth in Section 1.2.
“Assumed Seller Obligations” has the meaning set forth in Section 11.1.
“Business Day” means any calendar day except Saturdays, Sundays, and Federal
holidays.

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“Claim” or “Claims” means any demand, claim or notice sent or given in writing
by a Person to another Person in which the former asserts that it has suffered a
Loss, has become a party to a Proceeding or subjected to a demand that is the
responsibility of the latter Person.
“Claim Notice” has the meaning set forth in Section 11.2(c).
“Closing” has the meaning set forth in Section 9.1(a).
“Closing Date” has the meaning set forth in Section 9.1(b).
“Closing Payment” has the meaning set forth in Section 9.4(a).
“Closing Statements” means the Preliminary Closing Statement and the Final
Closing Statement.
“Code” means the Internal Revenue Code of 1986, as amended.
“Confidentiality Agreement” has the meaning set forth in Section 4.1(g).
“Contracts” has the meaning set forth in Section 1.2(d).
“Conveyance” has the meaning set forth in Section 3.1(b).
“Cure Period” has the meaning set forth in Section 3.4(c).
“Customary Post-Closing Consents” means the consents, approvals, required
notices, filing with or other actions for the assignment of the Assets to
Purchaser that are customarily obtained after the assignment of properties
similar to the Assets.
“Defensible Title” has the meaning set forth in Section 3.2(a).
“Deposit” has the meaning set forth in Section 2.3.
“DOJ” shall mean the Department of Justice.
“DTPA” has the meaning set forth in Section 11.8(a).
“Easements” has the meaning set forth in Section 1.2(e).
“Effective Time” has the meaning set forth in Section 1.4(a).
“Environmental Claim Date” has the meaning set forth in Section 4.3.
“Environmental Defect” has the meaning set forth in Section 4.3.
“Environmental Defect Amount” has the meaning set forth in Section 4.3.
“Environmental Defect Deductible” has the meaning set forth in Section 4.3.

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“Environmental Defect Notice” has the meaning set forth in Section 4.3.
“Environmental Laws” means, as the same may have been amended, superseded or
replaced, any federal, state or local statute, law, regulation, ordinance, rule,
order or decree including any rule of common law, relating to (i) the control of
any potential pollutant or protection of the environment, including air, water,
land or endangered, threatened, or protected species, (ii) the generation, use,
handling, treatment, storage, disposal, production or transportation of waste
materials, petroleum or natural gas, or (iii) the regulation of or exposure to
Hazardous Materials, including, but not limited to, the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.
(“CERCLA”); the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.
(“RCRA”); the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the
Clean Air Act, 42 U.S.C. § 7401 et seq. the Hazardous Materials Transportation
Act, 49 U.S.C. § 1471 et seq.; the Toxic Substances Control Act, 15 U.S.C. §§
2601 through 2629; the Oil Pollution Act, 33 U.S.C. § 2701 et seq.; the
Emergency Planning and Community Right-to-Know Act, 42 U.S.C. § 11001 et seq.;
the Safe Drinking Water Act, 42 U.S.C. §§ 300f through 300j; the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136 et seq.; the
Endangered Species Act, 16 U.S.C. § 1531 et seq.; the Occupational Safety and
Health Act, 29 U.S.C. § 651 et seq.; the Atomic Energy Act, 42 U.S.C. § 2011 et
seq.; and all applicable related law, whether local, state, territorial, or
national, of any Governmental Body having jurisdiction over the property in
question addressing pollution or protection of human health, safety, natural
resources or the environment and all regulations implementing the foregoing. The
term “Environmental Laws” includes all judicial and administrative decisions,
orders, directives, and decrees issued by a Governmental Body pursuant to the
foregoing.
“Environmental Liabilities” shall mean any and all environmental response costs
(including costs of remediation), damages, natural resource damages,
settlements, consulting fees, expenses, penalties, fines, orphan share,
prejudgment and post-judgment interest, court costs, attorneys’ fees, and other
liabilities incurred or imposed (i) pursuant to any order, notice of
responsibility, directive (including requirements embodied in Environmental
Laws), injunction, judgment or similar act (including settlements) by any
Governmental Body to the extent arising out of any violation of, or remedial
obligation under, any Environmental Laws which are attributable to the ownership
or operation of the Assets prior to, on or after the Effective Time or (ii)
pursuant to any claim or cause of action by a Governmental Body or other Person
for personal injury, property damage, damage to natural resources, remediation
or response costs to the extent arising out of any exposure to Hazardous
Materials, any violation of, or any remediation or obligation under, any
Environmental Laws which is attributable to the ownership or operation of the
Assets prior to, on or after the Effective Time; provided that “Environmental
Liabilities” excludes any of the foregoing to the extent caused by or relating
to NORM or disclosed in any Schedule. Notwithstanding the foregoing, the phrases
“violation of Environmental Laws” and “remedial obligation under any
Environmental Laws” and words of similar import shall mean, as to any given
Asset, the violation of or failure to meet specific objective requirements or
standards that are clearly applicable to such Asset under applicable
Environmental Laws where such requirements or standards are in effect as of the
Effective Time. The phrase does not include good or desirable operating
practices or standards that may be employed or adopted by other oil or gas well
operators or recommended by a Governmental Body.

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“Environmental Permits” has the meaning set forth in Section 5.24(a)(ii).
“Equipment” has the meaning set forth in Section 1.2(f).
“Excluded Assets” has the meaning set forth in Section 1.3.
“Excluded Seller Obligations” has the meaning set forth in Section 11.1.
“Final Adjustment” has the meaning set forth in Section 9.4(b).
“Final Closing Statement” has the meaning set forth in Section 9.4(b).
“Final Purchase Price” has the meaning set forth in Section 9.4(b).
“Final Settlement Date” has the meaning set forth in Section 9.4(b).
“Form 8594” has the meaning set forth in Section 2.4.
“FTC” shall mean the Federal Trade Commission.
“Fundamental Representations” has the meaning set forth in Section 11.2(a).
“Geologic Data” means all seismic, geological, geochemical or geophysical data
(including cores and other physical samples of materials from wells or tests)
belonging to Seller or licensed from third parties relating to the Properties
that can be transferred without additional consideration to such third parties
other than tape copying costs and expenses (or including such licensed data in
the event Purchaser agrees to pay such additional consideration).
“Governmental Body” or “Governmental Bodies” means any federal, state, local,
municipal, or other government; any governmental, regulatory or administrative
agency, commission, body or other authority exercising or entitled to exercise
any administrative, executive, judicial, legislative, police, regulatory or
taxing authority or power; and any court or governmental tribunal.
“Hazardous Material” means (i) any “hazardous substance,” as defined by CERCLA,
(ii) any “hazardous waste” or “solid waste,” in either case as defined by RCRA,
and any analogous state statutes, and any regulations promulgated thereunder,
(iii) any solid, hazardous, dangerous or toxic chemical, material, waste or
substance, within the meaning of and regulated by any applicable Environmental
Laws, (iv) any radioactive material, including any naturally occurring
radioactive material, and any source, special or byproduct material as defined
in 42 U.S.C. 2011 et seq. and any amendments or authorizations thereof, (v) any
regulated asbestos-containing materials in any form or condition, (vi) any
regulated polychlorinated biphenyls in any form or condition, and (vii)
petroleum, petroleum hydrocarbons or any fraction, derivative or byproducts
thereof.
“Hydrocarbons” means (i) oil, gas, casinghead gas, condensate and other gaseous
and liquid hydrocarbons or any combination thereof and (ii) all other minerals
(whether similar or dissimilar to the minerals listed in (i) above) of every
kind and character which may be extracted from or

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produced from the Properties and (iii) sulphur and other minerals extracted from
or produced with the foregoing.
“Imbalance” or “Imbalances” means any over-production, under-production,
over-delivery, under-delivery or similar imbalance of Hydrocarbons produced from
or allocated to the Assets, regardless of whether such over-production,
under-production, over-delivery under-delivery or similar imbalance arises at
the platform, wellhead, pipeline, gathering system, transportation system,
processing plant or other location.
“Indemnified Party” has the meaning set forth in Section 11.5(a).
“Indemnifying Party” has the meaning set forth in Section 11.5(a).
“Indemnity Agreement” has the meaning set forth in Section 3.4(d)(i).
“Indemnity Deductible” has the meaning set forth in Section 11.5(d)(ii).
“Independent Expert” has the meaning set forth in Section 4.3.
“Individual Benefit Threshold” has the meaning set forth in Section 3.4(j).
“Individual Environmental Threshold” has the meaning set forth in Section 4.3.
“Individual Title Threshold” has the meaning set forth in Section 3.4(j).
“Lands” has the meaning set forth in Section 1.2(a).
“Laws” means all statutes, laws, rules, regulations, ordinances, orders, and
codes of or by any Governmental Bodies.
“Leases” has the meaning set forth in Section 1.2(a).
“Losses” means any and all debts, obligations and other liabilities (whether
absolute, accrued, contingent, fixed or otherwise, or whether known or unknown,
or due or to become due or otherwise), diminution in value, monetary damages,
fines, fees, Taxes, penalties, interest obligations, deficiencies, losses and
expenses (including amounts paid in settlement, interest, court costs, costs of
investigators, reasonable fees and expenses of attorneys, accountants, financial
advisors and other experts, and other actual out of pocket expenses incurred in
investigating and preparing for or in connection with any Proceeding).
“Lowest Cost Response” means the response or action required under Environmental
Laws or Environmental Permits that addresses the condition present sufficient to
bring the condition or the affected Asset into compliance with Environmental
Laws or Environmental Permits or to address the liability created under
Environmental Law, at a reasonable cost (considered as a whole taking into
consideration the use of the Properties and in order to avoid any material
negative impact such response or action may have on the operations of the
relevant Assets and any potential material

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additional costs or liabilities that may likely arise as a result of such
response or action) as compared to any other response that is required or
allowed under Environmental Laws.
“Material Adverse Effect” means any effect that is material and adverse to the
ownership, operation or value of the Assets, taken as a whole, and as currently
operated; provided, however, that “Material Adverse Effect” shall not include
(i) any effect resulting from entering into this Agreement or the announcement
of the transactions contemplated by this Agreement; (ii) any effect resulting
from changes in general market, economic, financial or political conditions or
any outbreak of hostilities or war unless such result in a disproportionate
impact on the Assets, (iii) any effect that affects the Hydrocarbon exploration,
production, development, processing, gathering and/or transportation industry
generally (including changes in commodity prices or general market prices in the
Hydrocarbon exploration, production, development, processing, gathering and/or
transportation industry generally), and (iv) any effect resulting from a change
in Laws or regulatory policies.
“Material Contracts” means those Contracts that are material to the ownership or
current operation of the Assets, including (i) all of the unit agreements,
farmout and farmin agreements, pooling agreements, pooling designations, unit
operating agreements and operating agreements, exploration agreements,
participation agreements, transportation and gathering agreements, rig
contracts, pipe and other supply contracts and area of mutual interest
agreements, (ii) all of the production sales, marketing and processing
agreements, other than such agreements which are terminable by Seller without
penalty on 90 or fewer days’ notice, (iii) any Contract that could reasonably be
expected to obligate Seller to expend, or pursuant to which Seller may receive,
in excess of $75,000 in any calendar year, (iv) any Contract that is with an
Affiliate and (v) any Contract that evidences an obligation to pay the deferred
purchase price of property or services.
“Material Environmental Defect” means an uncured Environmental Defect that
exceeds the Individual Environmental Threshold.
“Material Title Benefit” means a Title Benefit that exceeds the Individual
Benefit Threshold.
“Material Title Defect” means an uncured Title Defect that exceeds the
Individual Title Threshold.
“Net Revenue Interest” has the meaning set forth in Section 3.2(a)(i).
“NORM” means naturally occurring radioactive material.
“Notice Period” has the meaning set forth in Section 11.5(a).
“Permitted Encumbrances” has the meaning set forth in Section 3.3.
“Person” means any individual, firm, corporation, partnership, limited liability
company, joint venture, association, trust, unincorporated organization,
Governmental Body or any other entity.
“Personal Property” has the meaning set forth in Section 1.2(g).
“Phase II” has the meaning set forth in Section 4.1(b).

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“Pipelines” has the meaning set forth in Section 1.2(g).
“Preference Right” means any right or agreement that enables any Person to
purchase or acquire any Asset or any interest therein or portion thereof as a
result of or in connection with (i) the sale, assignment or other transfer of
any Asset or any interest therein or portion thereof or (ii) the execution or
delivery of this Agreement or the consummation or performance of the terms and
conditions contemplated by this Agreement.
“Preliminary Closing Statement” has the meaning set forth in Section 9.4(a).
“Proceeding” has the meaning set forth in Section 5.7.
“Properties” has the meaning set forth in Section 1.2(c).
“Property Costs” has the meaning set forth in Section 1.4(b).
“Purchase Price” has the meaning set forth in Section 2.1.
“Purchaser” has the meaning set forth in the preamble hereto.
“Purchaser Indemnified Persons” has the meaning set forth in Section 11.3.
“Purchaser’s Representatives” has the meaning set forth in Section 4.1(a).
“Records” has the meaning set forth in Section 1.2(j).
“REGARDLESS OF FAULT” means WITHOUT REGARD TO THE CAUSE OR CAUSES OF ANY CLAIM,
INCLUDING, WITHOUT LIMITATION, EVEN THOUGH A CLAIM IS CAUSED IN WHOLE OR IN PART
BY:
OTHER THAN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, THE NEGLIGENCE (WHETHER SOLE,
JOINT, CONCURRENT, COMPARATIVE, CONTRIBUTORY, ACTIVE OR PASSIVE), STRICT
LIABILITY, OR OTHER FAULT OF THE SELLER INDEMNIFIED PERSONS; AND/OR
A PRE-EXISTING DEFECT, WHETHER PATENT OR LATENT, OF THE PREMISES OF PURCHASER’S
PROPERTY OR SELLER’S PROPERTY (INCLUDING WITHOUT LIMITATION THE ASSETS).
“Retained Asset” has the meaning set forth in Section 7.6(b).
“Retained Employee Liabilities” shall mean any liabilities of Seller or any of
its Affiliates arising out of claims by or on behalf of employees of Seller or
any of its Affiliates with respect to events that occur on or prior to the
Closing and that relate to their employment with, or the terminations of their
employment from, Seller.
“Seller” has the meaning set forth in the preamble hereto.

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“Seller Indemnified Persons” has the meaning set forth in Section 11.4.
“Seller Operated Assets” shall mean Assets operated by Seller.
“Taxes” means all federal, state, local, and foreign income, profits, franchise,
sales, use, ad valorem, property, severance, production, excise, stamp,
documentary, real property transfer or gain, gross receipts, goods and services,
registration, capital, transfer, or withholding taxes or other governmental fees
or charges imposed by any taxing authority, including any interest, penalties or
additional amounts which may be imposed with respect thereto.
“Termination Date” has the meaning set forth in Section 10.1(b)(i).
“Third Party Claim” has the meaning set forth in Section 11.5(a).
“Title Arbitrator” has the meaning set forth in Section 3.4(i).
“Title Benefit” has the meaning set forth in Section 3.2(b).
“Title Benefit Amount” has the meaning set forth in Section 3.4(e).
“Title Benefit Deductible” has the meaning set forth in Section 3.4(j).
“Title Benefit Notice” has the meaning set forth in Section 3.4(b).
“Title Claim Date” has the meaning set forth in Section 3.4(a).
“Title Defect” has the meaning set forth in Section 3.2(b).
“Title Defect Amount” has the meaning set forth in Section 3.4(d)(i).
“Title Defect Deductible” has the meaning set forth in Section 3.4(j).
“Title Defect Notice” has the meaning set forth in Section 3.4(a).
“Title Defect Property” has the meaning set forth in Section 3.4(a).
“Transfer Requirement” means any consent, approval, authorization or permit of,
or filing with or notification to, any Person which is required to be obtained,
made or complied with for or in connection with any sale, assignment or transfer
of any Asset or any interest therein; provided, however, that “Transfer
Requirement” shall not include any Customary Post-Closing Consents.
“Transfer Taxes” has the meaning set forth in Section 12.3.
“Units” has the meaning set forth in Section 1.2(c).
“UTPCPL” has the meaning set forth in Section 11.8(a).
“Wells” has the meaning set forth in Section 1.2(b).

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PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this “Agreement”) is executed on May 26, 2016,
by and between MID-CON ENERGY PROPERTIES, LLC, a Delaware limited liability
company, and MID-CON ENERGY OPERATING, LLC, an Oklahoma limited liability
company (collectively, “Seller”), and PO&G PANHANDLE, LP, a Texas limited
partnership (“Purchaser”).
RECITALS
A.    Seller desires to sell to Purchaser and Purchaser desires to purchase from
Seller the properties and rights of Seller hereafter described, in the manner
and upon the terms and subject to the conditions hereafter set forth.
B.    Capitalized terms used herein shall have the meanings ascribed to them in
this Agreement as such terms are identified and/or defined in the preceding
Definitions Section hereof.
NOW, THEREFORE, in consideration of the premises and of the mutual promises,
representations, warranties, covenants, conditions and agreements contained
herein, and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto, intending to be legally bound
by the terms hereof, agree as follows:
ARTICLE 1

PURCHASE AND SALE
Section 1.1 Purchase and Sale.
At the Closing, and upon the terms and subject to the conditions of this
Agreement, Seller agrees to sell, assign, transfer and convey the Assets to
Purchaser and Purchaser agrees to purchase, accept and pay for the Assets and to
assume the Assumed Seller Obligations.
Section 1.2 Assets.
As used herein, the term “Assets” means, subject to the terms and conditions of
this Agreement, all of Seller’s right, title, interest and estate, real or
personal, recorded or unrecorded, movable or immovable, tangible or intangible,
in and to the following (but excluding the Excluded Assets):
(a) All of the oil and gas leases; subleases and other leaseholds; net profits
interests; carried interests; farmout rights; options; and other properties and
interests described on Exhibit A (collectively, the “Leases”), together with
each and every kind and character of right, title, claim, and interest that
Seller has in and to the Leases and the lands covered by the Leases or the lands
currently pooled, unitized, communitized or consolidated therewith (the
“Lands”);

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(b) All oil, gas, water, disposal or injection wells located on or associated
with the Lands, whether producing, shut-in, or abandoned (even to the extent not
located on the Lands provided that each such well is listed on Exhibit A-1),
including the wells shown on Exhibit A-1 (collectively, the “Wells”);
(c) All interest of Seller derived from the Leases in or to any currently
existing pools or units which include any Lands or all or a part of any Leases
or include any Wells, including those pools or units shown on Exhibit A-1 (the
“Units”; the Units, together with the Leases, Lands and Wells, being hereinafter
referred to as the “Properties”), and including all interest of Seller derived
from or allocated to the Leases in production of Hydrocarbons from any such
Unit, whether such Unit production of Hydrocarbons comes from wells located on
or off of a Lease, and all tenements, hereditaments and appurtenances belonging
to the Leases and Units;
(d) All contracts, agreements and instruments by which the Properties are bound,
or that relate to or are otherwise applicable to the Properties and will be
binding on the Properties after Closing, but only to the extent applicable to
the Properties rather than Seller’s other properties and only with respect to
rights and obligations arising thereunder from and after the Effective Time
unless such right or obligation is an Assumed Seller Obligation, including but
not limited to, operating agreements, unitization, pooling and communitization
agreements, declarations and orders, joint venture agreements, farmin and
farmout agreements, exploration agreements, participation agreements, area of
mutual interest agreements, disposal agreements, water use agreements,
facilities or equipment leases, letters of no objection, production handling
agreements, exchange agreements, transportation or gathering agreements,
bottomhole agreements, balancing agreements, storage agreements, and agreements
for the sale and purchase of oil, gas, casinghead gas or processing agreements
to the extent applicable to the Properties or the production of Hydrocarbons
produced in association therewith from the Properties, including those
identified on Schedule 1.2(d) (hereinafter collectively referred to as
“Contracts”), but excluding any master service agreements scheduled on Schedule
1.3(e) and any contracts, agreements and instruments to the extent transfer is
restricted by third-party agreement to the extent scheduled on Schedule 5.13 or
applicable Law and the necessary consents to transfer are not obtained pursuant
to Section 7.6 and provided that “Contracts” shall not include the instruments
constituting the Leases;
(e) All easements, permits, licenses, servitudes, rights-of-way, surface leases
and other surface rights (“Easements”) appurtenant to, and used or held for use
in connection with the Properties (including those identified on Schedule
1.2(e)), but excluding any permits and other rights to the extent transfer is
restricted by third-party agreement to the extent scheduled on Schedule 5.13 or
applicable Law and the necessary consents to transfer are not obtained pursuant
to Section 7.6;
(f) All equipment, machinery, fixtures and other tangible personal property and
improvements located on or used, or held for use, in connection with the
Properties (including well equipment, casing, rods, tanks, boilers, buildings,
tubing, pumps, motors, and compression equipment) (other than vehicles or
vessels listed on Schedule 1.3(e)) (collectively, “Equipment”);
(g) All flow lines, pipelines, gathering systems, processing and separation
facilities, and appurtenances thereto located on the Properties or used, or held
for use, in connection with the

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operation of the Properties (“Pipelines” and, together with the Equipment and
Wells, “Personal Property”);
(h) All Hydrocarbons produced from or attributable to the Properties from and
after the Effective Time;
(i) All Imbalances;
(j) All of the files, records, information and data, whether written or
electronically stored, relating solely to the Assets, including: lease files;
land files; well files; gas and oil sales contract files; gas processing files;
division order files; abstracts; title opinions; land surveys; logs; maps;
engineering data and reports; technical evaluations and technical outputs;
evaluations; interpretive data or studies (including, without limitation,
geological or geophysical interpretative data); and other books, records, data,
files, and accounting records, in each case to the extent related to the Assets,
or used or held for use in connection with the maintenance or operation thereof,
but excluding (i) any books, records, data, files, logs, maps, evaluations,
outputs, and accounting records to the extent disclosure or transfer would
result in a violation of applicable Law or is restricted by any Transfer
Requirement scheduled on Schedule 5.13 that is not satisfied pursuant to Section
7.6, (ii) computer or communications software or intellectual property
(including tapes, codes, data and program documentation and all tangible
manifestations and technical information relating thereto),
(iii) attorney-client privileged communications and work product of Seller’s or
any of its Affiliates’ legal counsel (other than title opinions and title
reports), (iv) reserve studies, and (v) records relating to the negotiation and
consummation of the sale of the Assets (subject to such exclusions, the
“Records”); provided, however, that Seller may retain copies of such Records as
Seller has reasonably determined may be required for existing litigation, tax,
accounting, and auditing purposes;
(k) All vehicles and vessels used, or held for use, in connection with the
ownership and operation of the Assets, including those specifically listed on
Schedule 1.2(k);
(l) All Geological Data;
(m) Hydrocarbons stored in tanks and pipelines attributable to the ownership and
operation of the Assets that belong to Seller as of the Effective Time;
(n) Any claim against third parties relating to the Assumed Seller Obligations;
and
(o) Any claims and causes of action arising under or with respect to any Asset
and all proceeds arising from such claims and causes of action, including any
settlements thereof, to the extent such claims, causes of action and proceeds
are attributable to the period after the Effective Time or that relate to an
Assumed Seller Obligation.

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Section 1.3 Excluded Assets.
Notwithstanding the foregoing, the Assets shall not include, and there is
excepted, reserved and excluded from the purchase and sale contemplated hereby
(collectively, the “Excluded Assets”):
(a) all limited liability company, financial, income and franchise tax and legal
records of Seller that relate to Seller’s business generally (whether or not
relating to the Assets), and all books, records and files that relate to the
Excluded Assets and those records retained by Seller pursuant to Section 1.2(j)
and copies of any other Records retained by Seller pursuant to Section 1.5;
(b) All reserve estimates and economic estimates;
(c) all rights to any refund of Taxes or other costs or expenses borne by Seller
or Seller’s predecessors in interest and title attributable to periods prior to
the Effective Time, except to the extent the same relate to Assumed Seller
Obligations;
(d) Seller’s area-wide bonds, permits and licenses or other permits, licenses or
authorizations used in the conduct of Seller’s business generally;
(e) those items listed in Schedule 1.3(e);
(f) all trade credits, account receivables, note receivables, take-or-pay
amounts receivable, and other receivables attributable to the Assets with
respect to any period of time prior to the Effective Time (other than
Hydrocarbons stored in tanks and pipelines attributable to the ownership and
operation of the Assets that belong to Seller as of the Effective Time);
(g) all claims and causes of action (including any claims for insurance
proceeds) arising from acts, omissions or events or damage to or destruction of
property with respect to all periods prior to the Effective Time, except to the
extent the same relate to Assumed Seller Obligations;
(h) all right, title and interest of Seller in and to vehicles or vessels listed
on Schedule 1.3(e);
(i) except to the extent the same relate to Assumed Seller Obligations, all
rights, titles, claims and interests of Seller or any Affiliate of Seller (i) to
or under any policy or agreement of insurance or any insurance proceeds; except
to the extent provided in Section 3.5, and (ii) to or under any bond or bond
proceeds;
(j) any patent, patent application, logo, service mark, copyright, trade name,
trademark or other intellectual property of or associated with Seller or any
Affiliate of Seller or any business of Seller or of any Affiliate of Seller;
(k) all personal computers and associated peripherals and all radio and
telephone equipment;

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(l) all proprietary and other computer software;
(m) all documents and instruments of Seller that may be protected by an
attorney-client privilege (other than title opinions and title reports);
(n) all Geologic Data listed on Schedule 1.3(e);
(o) any offices, office leases or personal property that are not directly
related to the Assets; and
(p) all Assets that are excluded and not conveyed to Purchaser under Sections
3.4(d)(ii), 3.5 or 7.6 (or any other provision) of this Agreement.
Section 1.4 Effective Time; Proration of Costs and Revenues.
(a) Subject to Section 1.5, possession of the Assets shall be transferred from
Seller to Purchaser at the Closing, but for purposes of the adjustments made to
the Closing Statements certain financial benefits and burdens of the Assets
shall be transferred effective as of 7:00 A.M., local time, on May 1, 2016 (the
“Effective Time”), as described below.
(b) “Earned” and “incurred”, as used in this Agreement, shall be interpreted in
accordance with generally accepted accounting principles and Council of
Petroleum Accountants Society (COPAS) standards, as applicable. “Property Costs”
means all costs attributable to the ownership and operation of the Assets
(including without limitation costs of insurance relating specifically to the
Assets, royalties and overriding royalties payable on account of production from
the Assets, and ad valorem, property, severance, Hydrocarbon production and
similar Taxes based upon or measured by the ownership or operation of the Assets
or the production of Hydrocarbons therefrom, but excluding any other Taxes) and
capital expenditures incurred in the ownership and operation of the Assets in
the ordinary course of business and, where applicable, in accordance with the
relevant operating or unit agreement, if any, and overhead costs charged to the
Assets under the relevant operating agreement or unit agreement, if any, by
unaffiliated third parties and, with respect to Assets operated by Seller, an
amount equal to the amount Seller is entitled to receive under the applicable
operating or unit agreement (pro-rated for any partial months as applicable),
but excluding without limitation liabilities, losses, costs, and expenses
attributable to (i) Claims for personal injury or death, property damage or
violation of any Law, (ii) obligations to plug wells or dismantle, abandon and
salvage facilities, (iii) obligations to remediate any contamination of
groundwater, surface water, soil, Equipment or Pipelines under applicable
Environmental Laws, (iv) obligations to furnish make-up gas according to the
terms of applicable gas sales, gathering or transportation contracts, (v) gas
balancing obligations and (vi) obligations to pay working interests, royalties,
overriding royalties or other interests held in suspense by Seller that are
reflected on Schedule 5.21, all of which are addressed in Article 11. For
purposes of this Section 1.4, determination of whether Property Costs are
attributable to the period before or after the Effective Time for purposes of
the adjustments in the Closing Statements shall be based on when services are
rendered, when the goods are delivered, or when the work is performed. For
clarification, the date an item or work is ordered is not the date of a
transaction for settlement purposes in the Closing Statements, but rather the
date on which the item ordered is delivered to the job site, or the date on
which the work ordered is

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performed, shall be the relevant date. For purposes of allocating Hydrocarbon
production (and accounts receivable with respect thereto) under this Section
1.4, (i) liquid Hydrocarbons shall be deemed to be “from or attributable to” the
Properties when they pass through the pipeline connecting into the storage
facilities into which they are run and (ii) gaseous Hydrocarbons shall be deemed
to be “from or attributable to” the Properties when they pass through the
delivery point sales meters on the pipelines through which they are transported.
Seller shall utilize reasonable interpolative procedures to arrive at an
allocation of Hydrocarbon production when exact meter readings or gauging and
strapping data is not available. Seller shall provide to Purchaser, no later
than five (5) Business Days prior to Closing, all data necessary to support any
estimated allocation, for purposes of establishing the adjustment to the
Purchase Price pursuant to Section 2.2 hereof that will be used to determine the
Closing Payment for purposes of the Preliminary Closing Statement (as defined in
Section 9.4(a)). Taxes (except income, franchise and similar taxes),
right-of-way fees, insurance premiums and the Property Costs that are paid
periodically (but not delay rentals, bonuses, minimum royalties, option
payments, lease extension payments or shut-in royalties) shall be prorated based
on the number of days in the applicable period falling before and the number of
days in the applicable period falling at or after the Effective Time, except
that Hydrocarbon production, severance and similar Taxes shall be prorated based
on the number of units actually produced, purchased or sold or proceeds of sale,
as applicable, before, and at or after, the Effective Time.
(c) Purchaser shall be entitled to all Hydrocarbon production from or
attributable to the Properties at and after the Effective Time (and all products
and proceeds attributable thereto) and to all other income, proceeds, receipts
and credits earned with respect to the Assets at or after the Effective Time,
and shall be responsible for (and entitled to any refunds with respect to) all
Property Costs incurred at and after the Effective Time. Seller shall be
entitled to all Hydrocarbon production from or attributable to the Properties
prior to the Effective Time (and all products and proceeds attributable thereto)
and to all other income, proceeds, receipts and credits earned with respect to
the Assets prior to the Effective Time, and shall be responsible for (and
entitled to any refunds with respect to) all Property Costs incurred prior to
the Effective Time. In each case, Purchaser shall be responsible for the portion
allocated to the period at and after the Effective Time and Seller shall be
responsible for the portion allocated to the period before the Effective Time.
Section 1.5 Delivery and Maintenance of Records.
Seller, at Purchaser’s sole cost and expense, shall deliver the Records to
Purchaser not later than ten (10) days following Closing. Purchaser shall be
entitled to all original Records maintained by Seller and to a copy of all
electronic Records maintained by Seller. Seller shall be entitled to keep a copy
or copies of all Records; provided, however, that Seller shall keep confidential
and not disclose and shall not sell or otherwise allow third parties to review,
copy or otherwise use (for any purpose) any Records retained by Seller for their
own account, except as required by law and for disclosures to Seller’s
representatives, consultants and legal counsel bound by an obligation of
confidentiality. Purchaser shall preserve the Records for a period of seven (7)
years following the Closing and will allow Seller and its representatives,
consultants and advisors reasonable access, during normal business hours and
upon reasonable notice, to the Records (at the location of such Records in
Purchaser’s organization) for any legitimate business reason of Seller,
including in order for Seller to comply with a Tax or other legally required
reporting obligation or Tax or legal dispute;

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provided, however, that Purchaser shall not be required to grant access to
Seller or any of its representatives, consultants or advisors, to any Records
that are subject to an attorney/client or attorney work product privilege, that
would cause Purchaser to violate any obligation to any third party or breach any
restriction legally binding on Purchaser or that are trade secrets of Purchaser.
Any such access shall be at the sole cost and expense of Seller.
ARTICLE 2
    

PURCHASE PRICE
Section 2.1 Purchase Price.
The purchase price for the Assets (the “Purchase Price”) shall be Eighteen
Million Dollars ($18,000,000.00) payable in United States currency by wire
transfer in same day funds as and when provided in this Agreement and as
adjusted as provided in Section 2.2.
Section 2.2 Adjustments to Purchase Price.
For purposes of the Closing Statements, the Purchase Price for the Assets shall
be adjusted as follows (with such adjustments being made so as not to give any
duplicative effect) with all such amounts being determined in accordance with
generally accepted accounting principles and Council of Petroleum Accountants
Society (COPAS) standards:
(a) Reduced by the aggregate amount of the following proceeds actually received
by Seller: (i) proceeds from the sale of Hydrocarbons (net of any royalties,
overriding royalties or other burdens paid by Seller to third parties on or
payable out of Hydrocarbon production, gathering, processing and transportation
costs and any Hydrocarbon production, severance, sales or excise Taxes not
reimbursed to Seller by the purchaser of Hydrocarbon production) produced from
or attributable to the Properties during the period between the Effective Time
and the Final Settlement Date, and (ii) other proceeds earned with respect to
the Assets during the period between the Effective Time and the Final Settlement
Date;
(b) Increased by the aggregate amount of the following proceeds actually
received by Purchaser: (i) proceeds from the sale of Hydrocarbons (net of any
royalties, overriding royalties or other burdens paid by Purchaser to third
parties on or payable out of Hydrocarbon production, gathering, processing and
transportation costs and any Hydrocarbon production, severance, sales or excise
Taxes not reimbursed to Purchaser by the purchaser of Hydrocarbon production)
produced from or attributable to the Properties for periods prior to the
Effective Time except for Hydrocarbons described in Section 2.2(i), and (ii)
other proceeds earned with respect to the Assets for periods prior to the
Effective Time;
(c) (i) If Seller makes the election under Section 3.4(d)(i) with respect to a
Material Title Defect, subject to the Title Defect Deductible, reduced by the
Title Defect Amount with respect to such Material Title Defect for which the
Title Defect Amount has been determined and (ii) subject

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to the Title Benefit Deductible, increased by the Title Benefit Amount with
respect to each Material Title Benefit for which the Title Benefit Amount has
been determined;
(d) Subject to the Environmental Defect Deductible, reduced by the Environmental
Defect Amount with respect to each Material Environmental Defect if the
Environmental Defect Amount has been determined;
(e) Increased by the amount of all Property Costs and other costs attributable
to the ownership and operation of the Assets after the Effective Time which are
actually paid by Seller and incurred by Seller (including any overhead costs
under Section 1.4 with respect to the Seller Operated Assets deemed charged to
the Assets with respect to the Adjustment Period even though not actually paid),
except any Property Costs and other such costs already deducted in the
determination of proceeds in Section 2.2(a);
(f) Reduced to the extent provided in Section 3.4(d)(ii) for any Properties
excluded from the Assets pursuant to Section 3.4(d);
(g) Reduced to the extent provided in Section 4.3 for any Properties excluded
from the Assets pursuant to Section 4.3;
(h) Increased or reduced as provided elsewhere in this Agreement or as agreed
upon in writing by Seller and Purchaser;
(i) Increased by the value of the amount of merchantable Hydrocarbons stored in
tanks and pipelines attributable to the ownership and operation of the Assets
that belong to Seller as of the Effective Time (which value shall be computed at
the applicable third-party contract prices for the month of March 2016 for such
stored Hydrocarbons);
(j) INTENTIONALLY OMITTED;
(k) Reduced to the extent provided in Section 7.6 with respect to Retained
Assets;
(l) Reduced by the amount of funds held in suspense listed on Schedule 5.21; and
(m) Reduced by the amount of all Property Costs and other costs attributable to
the ownership and operation of the Assets prior to the Effective Time which are
actually paid by Purchaser and incurred by Purchaser, or which Purchaser is
required to assume under this Agreement, except any Property Costs and other
such costs already deducted in the determination of proceeds in Section 2.2(b).
For purposes of the Preliminary Closing Statement and Final Closing Statement,
but subject to the indemnities provided in this Agreement, each adjustment made
pursuant to Section 2.2(a) or Section 2.2(b) shall serve to satisfy, up to the
amount of the adjustment, Purchaser’s or Seller’s, as applicable, entitlement to
Hydrocarbon production from or attributable to the Properties during the
Adjustment Period, and to the value of other income, proceeds, receipts and
credits earned with respect to the Assets during the Adjustment Period, and as
such, Purchaser shall not have any separate rights to receive any Hydrocarbon
production or income, proceeds, receipts and credits with respect

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to which an adjustment has been made. Similarly, the adjustments described in
Sections 2.2(e) or Section 2.2(m) shall serve to satisfy, up to the amount of
the adjustment, Purchaser’s or Seller’s, as applicable, obligation to pay
Property Costs and other costs attributable to the ownership and operation of
the Assets which are incurred during the Adjustment Period, and as such,
notwithstanding anything in this Agreement to the contrary, Purchaser or Seller,
as applicable, shall not be separately obligated to pay for any Property Costs
or other such costs with respect to which an adjustment has been made.
Where available, actual figures will be used to prepare the Preliminary Closing
Statement. To the extent actual figures are not available, estimates will be
used subject to adjustment as provided in Section 9.4.
Section 2.3 Deposit.
Concurrently with the execution of this Agreement, Purchaser has paid to Seller
an earnest money deposit in an amount equal to five percent (5%) of the Purchase
Price (the “Deposit”). The Deposit shall be non-interest bearing and applied
against the Purchase Price if the Closing occurs or shall be otherwise
distributed in accordance with the terms of this Agreement.
Section 2.4 Allocated Values.
Purchaser has determined the allocation of the Purchase Price among the
Properties being acquired. The Allocated Values are set forth in Schedule
3.4(a). Prior to the Closing, Purchaser shall prepare Internal Revenue Service
Form 8594, Asset Acquisition Statement Under Section 1060 (“Form 8594”), in
conformity with the Allocated Values. Purchaser and Seller shall attach such
Form 8594 to their respective tax returns for the 2016 tax year, and to the
extent that the Purchase Price is adjusted, consistently revise and amend the
allocation schedule and Form 8594 as necessary. The allocation derived pursuant
to this Section shall be binding on Purchaser and Seller for all tax reporting
purposes and neither Purchaser nor Seller (or any of their respective
Affiliates) shall take any position (whether in tax returns, tax audits, or
other administrative or court proceedings with respect to taxes) which is
inconsistent with such allocation unless required to do so by applicable law.
ARTICLE 3
    

TITLE MATTERS
Section 3.1 Seller’s Title.
(a) Except for the special warranty of title referenced in Section 3.1(b) and
contained in the Conveyance and without limiting the rights expressly provided
in this Article 3, Seller makes no warranty or representation, express, implied,
statutory or otherwise, with respect to Seller’s title to any of the Assets, and
Purchaser hereby acknowledges and agrees that the Purchaser’s sole remedy for
any defect of title, including any Title Defect, with respect to any of the
Assets (i) before Closing, shall be as set forth in Section 3.4(c), Section
3.4(d), Section 8.2 and Article 10 and (ii) after Closing,

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shall be pursuant to the special warranty of title referenced in Section 3.1(b)
and contained in the Conveyance or pursuant to Section 3.4(i) with respect to
any Title Defects or Title Defect Amounts that are not agreed upon by Closing.
(b) The conveyance covering the Assets to be delivered by Seller to Purchaser
shall be substantially in the form of Exhibit B (the “Conveyance”). The
Conveyance shall contain a special warranty of Defensible Title by, through and
under Seller and its Affiliates, but not otherwise, but shall otherwise be
without warranty of title of any kind, express, implied or statutory or
otherwise.
(c) Purchaser shall not be entitled to protection under Seller’s special
warranty of title in the Conveyance against any Title Defect reported by
Purchaser under Section 3.4(a) prior to the Title Claim Date.
(d) Notwithstanding anything herein provided to the contrary, if a Title Defect
that may be asserted under this Article 3 results from any matter which could
also result in the breach of any representation or warranty of Seller set forth
in Article 5 (but excluding Section 5.18, Section 5.23, Section 5.26 (with
respect to calls on production) and Section 5.27), then Purchaser shall only be
entitled to assert such matter (i) before Closing, as a Title Defect to the
extent permitted by this Article 3, or (ii) after Closing, as a breach of
Seller’s special warranty of title referenced in Section 3.1(b) and contained in
the Conveyance, and shall be precluded from also asserting such matter as the
basis of the breach of any such representation or warranty.
Section 3.2 Definition of Defensible Title.
(a) As used in this Agreement, the term “Defensible Title” means that record
title of Seller with respect to the Units, Wells or other Assets shown in
Exhibit A-1 that, except for and subject to Permitted Encumbrances:
(i) Entitles Seller to receive a share of the Hydrocarbons produced, saved and
marketed (and the proceeds therefrom) from any Unit, Well or other Asset shown
in Exhibit A-1 throughout the duration of the productive life of such Unit, Well
or other Asset and in all applicable depths and formations (after satisfaction
of all royalties, overriding royalties, net profits interests or other similar
burdens on or measured by production of Hydrocarbons) (a “Net Revenue
Interest”), of not less than the Net Revenue Interest shown in Exhibit A-1 for
such Unit, Well or other Asset, except (solely to the extent that such actions
do not cause a breach of Seller’s covenants under Section 7.5) for decreases in
connection with those operations in which Seller may, with Purchaser’s consent,
from and after the date hereof become a non-consenting co-owner, decreases
resulting from the election to ratify or the establishment or amendment of pools
or units after the date hereof, in each case with Purchaser’s consent, and
decreases required to allow other working interest owners to make up past
underproduction or pipelines to make up past under deliveries as shown in each
case on Schedule 5.11, and except as stated in such Exhibit A-1;
(ii) Obligates Seller to bear a percentage of the costs and expenses for the
maintenance and development of, and operations relating to, (i) any Unit, Well
or other Asset shown in Exhibit A-1 not greater than the “working interest”
shown in Exhibit A-1 for such Unit, Well or other Asset in all applicable depths
and formations without increase throughout the productive

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life of such Unit, Well or other Asset, except as stated in Exhibit A-1 and
except for increases resulting from contribution requirements with respect to
non-consenting co-owners under applicable operating agreements and increases
that are accompanied by at least a proportionate increase in Seller’s Net
Revenue Interest as shown in Exhibit A-1; and
(iii) Is free and clear of liens, encumbrances, obligations, security interests,
irregularities, pledges, or other defects.
(b) As used in this Agreement, the term “Title Defect” means any lien, charge,
encumbrance, obligation (including contract obligation), defect, or other matter
(including without limitation a discrepancy in Net Revenue Interest or working
interest) that causes Seller not to have Defensible Title in and to the Units,
Wells or other Assets shown on Exhibit A-1 as of the Effective Time and the
Closing. As used in this Agreement, the term “Title Benefit” shall mean any
right, circumstance or condition that operates to increase the Net Revenue
Interest of Seller in any Unit, Well or other Asset shown on Exhibit A-1
throughout the duration of the productive life of such Asset and in all depths
and formations, without causing a greater than proportionate increase in
Seller’s working interest above that shown in Exhibit A-1 as of the Effective
Time and the Closing. Notwithstanding the foregoing, the following shall not be
considered Title Defects:
(i) defects based solely on a lack of information in Seller’s files;
(ii) defects arising out of lack of corporate or other entity authorization
unless Purchaser provides affirmative evidence that the action was not
authorized and results in another Person’s actual and superior claim of title to
the relevant Asset;
(iii) defects based on a gap in Seller’s chain of title in the county or parish
records as to the oil and gas leases comprising the Leases, unless such gap is
affirmatively shown to exist in such records by an abstract of title, title
opinion or landman’s title chain (which documents shall be included in a Title
Defect Notice);
(iv) defects that have been cured by applicable Laws of limitation or
prescription; and
(v) defects arising out of a lack of survey, unless a survey is expressly
required by applicable Laws.
Section 3.3 Definition of Permitted Encumbrances.
As used herein, the term “Permitted Encumbrances” means any or all of the
following:
(a) Royalties and any overriding royalties, reversionary interests and other
burdens on production, to the extent that the net cumulative effect of such
burdens does not reduce Seller’s Net Revenue Interest below that shown in
Exhibit A-1 as to any applicable depth or formation or as to any period of time
or increase Seller’s working interest above that shown in Exhibit A-1 as to any
applicable depth or formation or as to any period of time without a
corresponding increase in the Net Revenue Interest;

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(b) All Leases to the extent that they do not, individually or in the aggregate,
(i) reduce Seller’s Net Revenue Interest below that shown in Exhibit A-1 as to
any depth or formation or as to any period of time, (ii) increase Seller’s
working interest above that shown in Exhibit A-1 as to any depth or formation or
as to any period of time without a proportionate increase in the Net Revenue
Interest, or (iii) interfere in any material respect with the use, ownership or
operation of, the Assets subject thereto or affected thereby;
(c) Transfer Requirements applicable to this or any future transaction;
(d) Liens for current Taxes or assessments not yet delinquent or, if delinquent,
are being contested in good faith in the normal course of business;
(e) Materialman’s, mechanic’s, repairman’s, employee’s, contractor’s, operator’s
and other similar liens or charges arising in the ordinary course of business
for amounts not yet delinquent (including any amounts being withheld as provided
by Law), provided such amounts are paid prior to delinquency;
(f) All rights to consent by, required notices to, filings with, or other
actions by, Governmental Bodies in connection with the sale or conveyance of the
Assets or interests therein pursuant to this or any future transaction if they
are not required or customarily obtained prior to the sale or conveyance;
(g) Excepting circumstances where such rights have already been triggered,
rights of reassignment arising upon final intention to abandon or release the
Assets, or any of them;
(h) Easements listed on Schedule 1.2(e) and Contracts listed on Schedule 1.2(d)
to the extent that the net cumulative effect of such Easements and Contracts do
not (i) reduce Seller’s Net Revenue Interest below that shown in Exhibit A-1,
(ii) increase Seller’s working interest above that shown in Exhibit A-1 without
a corresponding increase in Net Revenue Interest, or (iii) detract in any
material respect from the value of, or interfere in any material respect with
the use, ownership, operation or development of the Assets;
(i) Calls on Hydrocarbon production under existing Contracts that are listed on
Schedule 1.2(d);
(j) All rights reserved to or vested in any Governmental Body to control or
regulate any of the Assets in any manner, and all obligations and duties under
all applicable Laws or under any franchise, grant, license or permit issued by
any such Governmental Body, provided there is no existing breach thereof or
non-compliance therewith;
(k) Any encumbrance on or affecting the Assets which is discharged by Seller at
or prior to Closing;
(l) Any matters shown on Schedule 3.3(l);
(m) Imbalances associated with the Assets;

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(n) Liens granted under applicable joint operating agreements for amounts not
delinquent; and
(o) Such Title Defects as Purchaser may have waived expressly in writing.
Section 3.4 Notice of Title Defect Adjustments.
(a) To assert a claim of a Title Defect prior to Closing, Purchaser must deliver
claim notices to Seller (each, a “Title Defect Notice”) on or before July 15,
2016 (the “Title Claim Date”); provided, however, that Purchaser agrees that it
shall furnish Seller once every two (2) weeks, commencing on the fourteenth
(14th) day following the date of this Agreement until the Title Claim Date with
a Title Defect Notice if any officer of Purchaser or its Affiliates discover or
learn of any Title Defect during such two (2) week period, which notice may be
preliminary in nature and supplemented before the expiration of the Title Claim
Date. Each Title Defect Notice shall be in writing and shall include (i) a
description of the alleged Title Defect(s), (ii) the Units, Wells or other
Assets in Exhibit A-1 affected by the Title Defect (each, a “Title Defect
Property”), (iii) the Allocated Value of each Title Defect Property, (iv) to the
extent available and in Purchaser’s possession, supporting documents reasonably
necessary for Seller (as well as any title attorney or examiner hired by Seller)
to verify the existence of the alleged Title Defect(s), and (v) the amount by
which Purchaser reasonably believes the Allocated Value of each Title Defect
Property is reduced by the alleged Title Defect(s) and the computations and
information upon which Purchaser’s belief is based. Notwithstanding any other
provision of this Agreement to the contrary, but subject to Section 3.1(d) and
Purchaser’s rights in connection with the special warranty of title referenced
in Section 3.1(b) and contained in the Conveyance, Purchaser shall be deemed to
have waived its right to assert Title Defects of which Seller has not been given
notice on or before the Title Claim Date. For purposes hereof, the “Allocated
Value” of an Asset shall mean the portion of the Purchase Price that has been
allocated to a particular Unit or Well in Schedule 3.4(a).
(b) Seller shall have the right, but not the obligation, to deliver to Purchaser
on or before the Title Claim Date, with respect to each Title Benefit, a notice
(a “Title Benefit Notice”) including (i) a description of the Title Benefit,
(ii) the Units, Wells or other Assets in Exhibit A-1 affected, (iii) the
Allocated Values of the Units, Wells or other Assets in Exhibit A-1 subject to
such Title Benefit, (iv) supporting documents reasonably necessary for Purchaser
(as well as any title attorney or examiner hired by Purchaser) to verify the
existence of the alleged Title Benefit(s) and (v) the amount by which Seller
reasonably believes the Allocated Value of those Units, Wells or other Assets is
increased by the Title Benefit, and the computations and information upon which
Seller’s belief is based. Seller shall be deemed to have waived all Title
Benefits of which it has not given notice to Purchaser on or before the Title
Claim Date.
(c) Seller shall have the right, but not the obligation, to attempt, at its sole
cost, to cure to the reasonable satisfaction of Purchaser at any time on or
prior to Closing (the “Cure Period”), unless the parties may otherwise agree,
any Title Defects of which it has been advised in writing by Purchaser pursuant
to the procedures hereof.
(d) In the event that (A) any Title Defect is not waived by Purchaser and
(B) Seller does not elect on or before Closing to cure any Title Defect or
Seller has elected before Closing to

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cure a Title Defect but such Title Defect has not been cured by the expiration
of the Cure Period, then subject to the parties’ rights under Section 3.4(i),
Article 8 and Article 10, Seller shall:
(i) Convey the Property that is subject to such Title Defect, and subject to the
Individual Title Threshold and the Title Defect Deductible, reduce the Purchase
Price by an amount agreed upon (“Title Defect Amount”) pursuant to Section
3.4(g) by Purchaser and Seller as being the value of such Title Defect, taking
into consideration the Allocated Value of the Property subject to such Title
Defect, the portion of the Property subject to such Title Defect and the legal
effect of such Title Defect on the Property affected thereby; provided, however,
that the methodology, terms and conditions of Section 3.4(g) shall control any
such determination;
However, Seller may alternatively elect, with Purchaser’s consent, to:
(i) indemnify Purchaser against all liability, loss, cost and expense resulting
from such Title Defect pursuant to an indemnity agreement (the “Indemnity
Agreement”) in the form to be mutually agreed upon; or
(ii) retain the portion or percentage of the Property that is subject to such
Title Defect, together with all associated Assets, in which event the Purchase
Price shall be reduced by an amount equal to the Allocated Value associated
therewith.
(e) Subject to the Individual Benefit Threshold and the Title Benefit
Deductible, with respect to each Unit, Well or other Asset in Exhibit A-1
affected by Title Benefits reported under Section 3.4(b), the Purchase Price
shall be increased by an amount (the “Title Benefit Amount”) equal to the
increase in the Allocated Value for such Unit, Well or other Asset in Exhibit
A-1 caused by such Title Benefits, as determined pursuant to Section 3.4(h).
(f) Except as provided in Section 8.2 and Article 10, Section 3.4(d) shall be
the exclusive right and remedy of Purchaser with respect to Title Defects
asserted by Purchaser pursuant to Section 3.4(a). Section 3.4(e) shall be the
exclusive right and remedy of Seller with respect to Title Benefits asserted by
Seller pursuant to Section 3.4(b).
(g) The Title Defect Amount resulting from a Title Defect shall be the amount by
which the Allocated Value of the Title Defect Property affected by such Title
Defect is reduced as a result of the existence of such Title Defect and shall be
determined in accordance with the following methodology, terms and conditions:
(i) if Purchaser and Seller agree on the Title Defect Amount, that amount shall
be the Title Defect Amount;
(ii) if the Title Defect is a lien, encumbrance or other charge which is
undisputed and liquidated in amount, then the Title Defect Amount shall be the
amount necessary to be paid to remove the Title Defect from the Title Defect
Property;
(iii) if the Title Defect represents a discrepancy between (A) the Net Revenue
Interest for any Title Defect Property and (B) the Net Revenue Interest stated
on Exhibit A-1 for

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such Title Defect Property, then the Title Defect Amount shall be the product of
the Allocated Value of such Title Defect Property multiplied by a fraction, the
numerator of which is the Net Revenue Interest decrease and the denominator of
which is the Net Revenue Interest stated on Exhibit A-1 for such Title Defect
Property;
(iv) if the Title Defect represents an obligation, encumbrance, burden or charge
upon or other defect in title to the Title Defect Property of a type not
described in subsections (i), (ii) or (iii) above, then the Title Defect Amount
shall be determined by taking into account the Allocated Value of the Title
Defect Property, the portion of the Title Defect Property affected by the Title
Defect, the legal effect of the Title Defect, the potential economic effect of
the Title Defect over the life of the Title Defect Property, the values placed
upon the Title Defect by Purchaser and Seller and such other factors as are
necessary to make a proper evaluation; and
(v) the Title Defect Amount with respect to a Title Defect Property shall be
determined without duplication of any costs or losses included in another Title
Defect Amount hereunder; and
(vi) notwithstanding anything to the contrary in this Article 3, the aggregate
Title Defect Amounts attributable to the effect of all Title Defects upon any
Title Defect Property shall not exceed the Allocated Value of the Title Defect
Property.
(h) Title Benefit Amount. The Title Benefit Amount resulting from a Title
Benefit shall be determined in accordance with the following methodology, terms
and conditions:
(i) if Purchaser and Seller agree on the Title Benefit Amount, then that amount
shall be the Title Benefit Amount; and
(ii) the Title Benefit Amount for any Title Benefit not determined pursuant to
subsection (i) above shall be the product of the Allocated Value of the affected
Property multiplied by a fraction, the numerator of which is the Net Revenue
Interest increase and the denominator of which is the Net Revenue Interest
stated on Exhibit A-1 for such Property.
(i) Seller and Purchaser shall attempt in good faith to agree on all Title
Defects, Title Benefits, Title Defect Amounts and Title Benefit Amounts prior to
Closing. If Seller and Purchaser are unable to agree by Closing, then subject to
each party’s rights under Article 8 and Article 10, the Title Defects, Title
Benefits, Title Defect Amounts and Title Benefit Amounts in dispute shall be
exclusively and finally resolved by arbitration pursuant to this Section 3.4(i).
There shall be a single arbitrator, who shall be a title attorney with at least
ten (10) years’ experience in oil and gas titles involving properties in the
regional area in which the Properties are located, as selected by mutual
agreement of Purchaser and Seller within fifteen (15) Business Days after the
end of the Cure Period, and absent such mutual agreement, by the Dallas office
of the American Arbitration Association (the “Title Arbitrator”). The
arbitration proceeding shall be held in Fort Worth, Texas and shall be conducted
in accordance with the Commercial Arbitration Rules of the American Arbitration
Association, to the extent such rules do not conflict with the terms of this
Section. The Title Arbitrator’s determination shall be made within fifteen (15)
Business Days after submission of the matters in dispute and shall be final and
binding upon both parties, without right

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of appeal. In making his determination, the Title Arbitrator shall be bound by
the rules set forth in Sections 3.4(a), 3.4(b), 3.4(c), 3.4(d), 3.4(e), 3.4(f),
3.4(g), 3.4(h), and 3.4(j) and may consider such other matters as in the opinion
of the Title Arbitrator are necessary or helpful to make a proper determination.
Additionally, the Title Arbitrator may consult with and engage disinterested
third parties to advise the Title Arbitrator, including without limitation
petroleum engineers. The Title Arbitrator shall act as an expert for the limited
purpose of determining the specific disputed Title Defects, Title Benefits,
Title Defect Amounts and Title Benefit Amounts submitted by either party and may
not award damages, interest or penalties to either party with respect to any
matter. Seller and Purchaser shall each bear its own legal fees and other costs
of presenting its case. Each party shall bear one-half of the costs and expenses
of the Title Arbitrator, including any costs incurred by the Title Arbitrator
that are attributable to such third party consultation. Within ten (10) days
after the Title Arbitrator delivers written notice to Purchaser and Seller of
his award with respect to a Title Defect Amount or a Title Benefit Amount, (i)
Purchaser shall pay to Seller the amount, if any, so awarded by the Title
Arbitrator to Seller, plus interest payable on such amount at the Agreed
Interest Rate from (but not including) the Closing Date to (and including) the
date on which such amount is paid to Seller and (ii) Seller shall pay to
Purchaser the amount, if any, so awarded by the Title Arbitrator to Purchaser,
plus interest payable on such amount at the Agreed Interest Rate from (but not
including) the Closing Date to (and including) the date on which such amount is
paid to Purchaser.
(j) Notwithstanding anything to the contrary in this Agreement, (i) in no event
shall there be any adjustments to the Purchase Price for any individual uncured
Title Defect for which the Title Defect Amount therefor does not exceed $10,000
(“Individual Title Threshold”); and (ii) in no event shall there be any
adjustments to the Purchase Price for uncured Title Defects unless the aggregate
Title Defect Amounts attributable to all uncured Material Title Defects exceeds
a deductible in an amount equal to one and five tenths Percent (1.5%) of the
Purchase Price (the “Title Defect Deductible”), after which point adjustments to
the Purchase Price shall be made or available to Purchaser only to the extent
the aggregate Title Defect Amounts with respect to uncured Material Title
Defects are in excess of such Title Defect Deductible. Notwithstanding anything
to the contrary in this Agreement, (A) in no event shall there be any increase
in the Purchase Price for any individual Title Benefit for which the Title
Benefit Amount therefor does not exceed $10,000 (“Individual Benefit
Threshold”); and (B) in no event shall there be any increase in the Purchase
Price for Title Benefits unless the aggregate Title Benefit Amounts attributable
to all Material Title Benefits exceeds a deductible in an amount equal to one
and five tenths (1.5%) of the Purchase Price (the “Title Benefit Deductible”),
after which point adjustments to the Purchase Price shall be made only to the
extent the aggregate Title Benefit Amounts with respect to Material Title
Benefits are in excess of such Title Benefit Deductible.

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Section 3.5 Casualty or Condemnation Loss.
(a) From and after the Effective Time, but subject to the provisions of Section
3.5(b), and below, Purchaser shall assume all risk of loss with respect to and
any change in the condition of the Assets during the Adjustment Period for
production of Hydrocarbons through normal depletion (including but not limited
to the watering out of any Well, collapsed casing or sand infiltration of any
Well) and the depreciation of personal property due to ordinary wear and tear.
(b) If, during the Adjustment Period any portion of the Assets is destroyed by
fire or other casualty or is taken in condemnation or under right of eminent
domain or if proceedings for such purposes shall be pending or threatened, and
the sum of all Losses from all such casualties and takings exceeds or is
expected to exceed Twenty Percent (20%) of the total unadjusted Purchase Price,
either party shall have the right to terminate this Agreement and Purchaser
shall promptly receive back the Deposit. If the sum of all Losses from all such
casualties and takings is Twenty Percent (20%) or less of the total unadjusted
Purchase Price, Purchaser shall be required to close notwithstanding any such
destruction, taking or proceeding or the threat thereof, and Seller shall (i) at
Closing pay to Purchaser all sums paid or payable to Seller by third parties by
reason of any casualty or taking insofar as with respect to the Assets and shall
assign, transfer and set over to Purchaser or subrogate Purchaser to all of
Seller’s right, title and interest (if any) in insurance claims, unpaid awards
and other rights against third parties (other than Affiliates of Seller and its
directors, officer, employees and agents) arising out of the casualty or taking
and (ii) indemnify Purchaser through a document reasonably acceptable to Seller
and Purchaser against any costs or expenses that Purchaser reasonably incurs to
repair the Assets subject to such casualty or taking that are, in the aggregate,
in excess of the amount paid to Purchaser by Seller pursuant to subsection (i)
above.
Section 3.6 Limitations on Applicability.
The right of Purchaser to assert a Title Defect under this Agreement and receive
a remedy therefor under this Article 3 shall terminate as of the Title Claim
Date, provided there shall be no termination of Purchaser’s or Seller’s rights
under Section 3.4 with respect to any bona fide Title Defect properly reported
in a Title Defect Notice or bona fide Title Benefit Claim properly reported in a
Title Benefit Notice on or before the Title Claim Date. From and after Closing,
subject to Purchaser’s right to assert a breach of the representations and
warranties set forth in Section 5.18, Section 5.23, Section 5.26 (with respect
to calls on production) and Section 5.27 or Seller’s breach of its covenants
under Section 7.5, Purchaser’s sole and exclusive rights and remedies with
regard to title to the Assets shall be as set forth in, and shall arise under,
the Conveyance transferring the Assets from Seller to Purchaser.

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ARTICLE 4
    

ENVIRONMENTAL MATTERS
Section 4.1 Assessment.
(a) From and after the date hereof and up to and including the Closing Date (or
earlier termination of this Agreement) but subject to (i) applicable Laws, (ii)
the other provisions of this Section 4.1 and (iii) obtaining any required
consents of third parties (with respect to which consents Seller shall use
commercially reasonable efforts to obtain), Seller shall afford to Purchaser and
its officers, employees, agents, accountants, attorneys, investment bankers
consultants, and other authorized representatives (“Purchaser’s
Representatives”) full access, during normal business hours and upon reasonable
notice, to the Assets and all Records and other documents in Seller’s or any
their respective Affiliates’ possession relating primarily to the Assets
(provided, however, that Purchaser’s right to access all Records and such other
documents shall not be subject to the limitation set forth in subsection (iii)
of this Section 4.1(a)). Seller shall also make available to Purchaser and
Purchaser’s Representatives, upon reasonable notice during normal business
hours, Seller’s personnel knowledgeable with respect to the Assets in order that
Purchaser may make such diligence investigation as Purchaser considers necessary
or appropriate, and shall provide Purchaser access to the complete environmental
reports, audits, data, and other documents related to the environmental
condition or compliance of the Assets in Seller’s possession or control . All
investigations and due diligence conducted by Purchaser or any Purchaser’s
Representative shall be conducted at Purchaser’s sole cost, risk and expense and
any conclusions made from any examination done by Purchaser or any Purchaser’s
Representative shall result from Purchaser’s own independent review and
judgment, provided Seller complies with this Section 4.1(a).
(b) Upon reasonable notice to Seller, Purchaser shall have the right to conduct
a Phase 1 environmental site assessment, environmental compliance audit or other
visual inspection of all or any portion of the Assets (the “Assessment”), to be
conducted by a reputable environmental consulting or engineering firm. In the
event the Assessment identifies a “recognized environmental condition” as such
term is defined in ASTM Standard 1527 13 or a compliance audit identifies a
material non-compliance finding, Purchaser shall have the right to conduct a
subsurface investigation, testing or other review as Purchaser reasonably
determines (the “Phase II”). The Assessment and Phase II shall be conducted at
the sole cost and expense of Purchaser, and shall be subject to the indemnity
provisions of Section 4.4. If any of the proposed activities unreasonably
interfere with normal operation of the Properties, Seller may require an
appropriate reasonable modification of the proposed activity. Seller shall have
the right to be present during any Assessment or Phase II of the Assets and
shall have the right, at its option and expense, to split samples with
Purchaser.
(c) Purchaser shall coordinate its Assessments and Phase II of the Assets with
Seller to minimize any unreasonable inconvenience to or interruption of the
conduct of business by Seller. Purchaser shall abide by Seller’s safety rules,
regulations and operating policies while conducting its due diligence evaluation
of the Assets including any environmental or other inspection or assessment of
the Assets.

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(d) Purchaser agrees to provide Seller promptly, but not later than the
Environmental Claim Date, copies of all reports, test results, and other
non-privileged documentation and data prepared or compiled by Purchaser and/or
any of Purchaser’s Representatives to the extent related to an Environmental
Defect and which contain information collected or generated from Purchaser’s due
diligence with respect to the Assets. Seller shall not be deemed by its receipt
of said documents or otherwise to have made any representation or warranty,
expressed, implied or statutory, as to the condition to the Assets or to the
accuracy of said documents or the information contained therein, provided Seller
notifies Purchaser of an material inaccuracies identified by Seller in its
review of the documents or information.
(e) Upon completion of Purchaser’s due diligence, Purchaser shall at its sole
cost and expense and without any cost or expense to Seller or its Affiliates,
(i) repair all damage done to the Assets to the extent caused by Purchaser’s due
diligence and complete such work in accordance with recognized industry
standards, (ii) restore the Assets to the approximate same condition than
existed prior to commencement of Purchaser’s due diligence, to the extent of any
damage related to Purchaser’s due diligence, and (iii) remove all equipment,
tools or other property brought onto the Assets in connection with Purchaser’s
due diligence. Any damage to the Assets (including, without limitation, any real
property, platform or other fixtures associated with such Assets) to the extent
caused by Purchaser’s due diligence will be promptly corrected by Purchaser.
(f) During all periods that Purchaser, and/or any of Purchaser’s Representatives
are on the Assets, Purchaser shall maintain, at its sole expense and with
insurers reasonably satisfactory to Seller, policies of insurance of the types
and in the amounts consistent with recognized industry practices. Coverage under
all insurance required to be carried by Purchaser hereunder will list Seller
Indemnified Parties as additional named insureds. Upon request by Seller,
Purchaser shall provide evidence of such insurance to Seller prior to entering
upon the Assets.
(g) Seller shall not, and shall cause its representatives to not, disclose any
information obtained by Purchaser and its representatives pursuant to this
Section 4.1 without Purchaser’s express written consent. Seller shall maintain
such information in strict confidence in the same manner contemplated by the
terms of that certain confidentiality agreement dated March 8, 2016, by and
between Seller and Purchaser (the “Confidentiality Agreement”).
Section 4.2 NORM, Wastes and Other Substances.
Purchaser acknowledges that the Assets have been used for the exploration,
development, and production of Hydrocarbons and that Equipment and sites
included in the Assets may contain NORM.
Section 4.3 Environmental Defects.
If, as a result of its investigation pursuant to Section 4.1, Purchaser
determines that with respect to any individual Asset, there exists a violation
of an Environmental Law or Environmental Permit or a condition thereon that
currently creates liability or requires investigation or remediation under
applicable Environmental Laws (other than with respect to NORM ) (in each case,
an “Environmental Defect”), then on or prior to July 15, 2016 (the
“Environmental Claim Date”),

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Purchaser may notify Seller in writing of such Environmental Defect (an
“Environmental Defect Notice”). Except for the indemnity for an Excluded Seller
Obligation or breach of the environmental representation and warranty set forth
in Section 5.24, for all purposes of this Agreement and applicable Law,
Purchaser shall be deemed to have waived any Environmental Defect and any right
or remedy arising as a result thereof which Purchaser fails to assert as an
Environmental Defect by an Environmental Defect Notice received by Seller on or
before the Environmental Claim Date. To be effective, each such notice shall set
forth (i) a description of the matter constituting the alleged Environmental
Defect, (ii) the Units/Wells and associated Assets affected by the Environmental
Defect, (iii) the estimated Lowest Cost Response to eliminate the Environmental
Defect in question (the “Environmental Defect Amount”), and (iv) supporting
documents reasonably necessary for Seller to verify the existence of the alleged
Environmental Defect and the Environmental Defect Amount. Purchaser shall
furnish Seller once every two (2) weeks until the Environmental Claim Date with
an Environmental Defect Notice if any officer of Purchaser or its Affiliates
discover or become aware of an Environmental Defect during such two (2) week
period, which notice may be preliminary in nature and supplemented before the
expiration of the Environmental Claim Date. Subject to the following sentence,
with respect to each Environmental Defect asserted by Purchaser in an
Environmental Defect Notice, Seller shall elect to have one of the following
remedies apply: (i) reduce the Purchase Price by an amount agreed upon in
writing by Purchaser and Seller as being a reasonable estimate of the cost of
curing the Environmental Defect, provided that if an Environmental Defect is
estimated to result in a cost higher than the Allocated Value of the Asset,
Purchaser may elect to exclude the Asset and such Asset shall be retained by
Seller, in which event the Purchase Price shall be reduced by an amount equal to
the Allocated Value of such Property, (ii) with Purchaser’s consent, retain the
Property or part of the Asset that is associated with such Environmental Defect
Notice and affected by such Environmental Defect, in which event the Purchase
Price shall be reduced by an amount equal to the Allocated Value of such
Property or part of the Asset, (iii) with Purchaser’s consent, perform or cause
to be performed such operations or actions as are necessary to cure any
Environmental Defect to the reasonable satisfaction of Purchaser before Closing
and provide Purchaser documents to demonstrate that each Environmental Defect
has been cured or (iv) with Purchaser’s consent, enter into an agreement with
Purchaser to be negotiated in good faith with Purchaser for a plan of
investigation and remediation or compliance with respect to such Environmental
Defect and the time period by which such remediation or compliance shall take
place after Closing. If Seller disagrees with any of Purchaser’s assertions with
respect to the existence of an Environmental Defect or the Environmental Defect
Amount, Purchaser and Seller will attempt to resolve the dispute prior to
Closing. If the dispute cannot be resolved within twenty (20) days of the first
meeting of Purchaser and Seller, either party may submit the dispute to an
environmental consultant approved in writing by Seller and Purchaser that is
experienced in environmental corrective or compliance action at oil and gas
properties in the relevant jurisdiction and that shall not have performed
professional services for either party or any of their respective Affiliates
during the previous five years (the “Independent Expert”). The Independent
Expert will conduct the dispute resolution proceeding by written submissions
from Purchaser and Seller with exhibits, including interrogatories, supplemented
with appearances by Purchaser and Seller, if necessary, as the Independent
Expert may deem necessary. After the parties and Independent Expert have had the
opportunity to review all such submissions, which in no event shall be later
than thirty (30) days counted from and after such submissions are made, the
Independent Expert shall call for a final, written offer of resolution from each
party, which shall be provided

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within five (5) Business Days. The Independent Expert shall render its decision
within twenty (20) Business Days of the deadline for receiving such offers by
selecting one or the other of the offers it has received or some compromise
based upon the two offers received. The Independent Expert may not award
damages, interest or penalties to either party with respect to any matter. The
decision of the Independent Expert shall be final and binding upon both parties,
without right of appeal. Seller and Purchaser shall each bear its own legal fees
and other costs of presenting its case to the Independent Expert. Each party
shall bear one-half of the costs and expenses of the Independent Expert. The
parties shall adjust the Purchase Price to reflect the Environmental Defect
Amounts, as agreed by the parties or as determined by the Independent Expert,
for all uncured Environmental Defects (subject to the estimate delivered under
Section 9.4(a) for then unresolved Environmental Defects); provided, that
notwithstanding anything to the contrary, (a) in no event shall there be any
adjustments to the Purchase Price for any individual uncured Environmental
Defect for which the Environmental Defect Amount therefor does not exceed
$50,000 (“Individual Environmental Threshold”); and (b) in no event shall there
be any adjustments to the Purchase Price for any uncured Environmental Defect
unless the aggregate Environmental Defect Amount attributable to all Material
Environmental Defects exceeds one and five tenths Percent (1.5%) of the Purchase
Price (the “Environmental Defect Deductible”), after which point Purchaser shall
be entitled to adjustments to the Purchase Price only to the extent the
aggregate Environmental Defect Amounts with respect to all uncured Material
Environmental Defects are in excess of such Environmental Defect Deductible. To
the extent the Independent Expert fails to determine any disputed Environmental
Defect Amounts prior to Closing, then, within ten (10) days after the
Independent Expert delivers written notice to Purchaser and Seller of his award
with respect to an Environmental Defect Amount, Seller shall pay to Purchaser
the amount, if any, so awarded by the Independent Expert.
Section 4.4 Inspection Indemnity.
Purchaser hereby agrees to defend, indemnify and hold harmless owners of the
Assets and Seller Indemnified Parties from and against any and all Losses to the
extent resulting from the Assessment or any field visit, environmental property
assessment, or other due diligence activity conducted by Purchaser or any
Purchaser’s Representative with respect to the Assets.
Section 4.5 Exclusive Remedy.
Subject to the limitations contained therein and subject further to the
indemnity for breach of the environmental representation and warranty contained
in Section 5.24, Section 4.3 shall be the exclusive right and remedy of
Purchaser with respect to any Environmental Defect, provided Seller has complied
with its obligations under this Article 4. Purchaser hereby waives any claims of
cost recovery or contribution from Seller or its Affiliates related to the
Assets under any Environmental Law or other cause of action, provided Seller has
complied with its obligations under this Article 4.
ARTICLE 5
    

REPRESENTATIONS AND WARRANTIES OF SELLER

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Section 5.1 Generally.
(a) Any representation or warranty qualified “to the knowledge of Seller” or “to
Seller’s knowledge” or with any similar knowledge qualification is limited to
matters within the actual knowledge of the officers of Seller. “Actual
knowledge” for purposes of this Agreement means information actually personally
known by such Persons, without any further duty of inquiry or investigation.
(b) Inclusion of a matter on a Schedule to a representation or warranty which
addresses matters having a Material Adverse Effect shall not be deemed an
indication that such matter does, or may, have a Material Adverse Effect.
Likewise, the inclusion of a matter on a Schedule in relation to a
representation or warranty shall not be deemed an indication that such matter
necessarily would, or may, breach such representation or warranty absent its
inclusion on such Schedule.
(c) Subject to the foregoing provisions of this Section 5.1, the disclaimers and
waivers contained in Sections 11.7, 11.8, 11.9, 11.11 and 11.12 and the other
terms and conditions of this Agreement, Seller represents and warrants to
Purchaser the matters set out in the remainder of this Article 5.
Section 5.2 Existence and Qualification.
Seller is a limited liability company duly organized, validly existing and in
good standing under the laws of the States of Delaware and Oklahoma and is duly
qualified to do business, and is in good standing, in each jurisdiction where
the Assets are located.
Section 5.3 Power.
Seller has full limited liability company power and authority to enter into and
perform its obligations under this Agreement and to consummate the transactions
contemplated by this Agreement.
Section 5.4 Authorization and Enforceability.
The execution, delivery and performance of this Agreement, and the performance
of the transactions contemplated hereby, have been duly and validly authorized
by all necessary limited liability company action on the part of Seller. This
Agreement has been duly executed and delivered by Seller (and all documents
required hereunder to be executed and delivered by Seller at Closing will be
duly executed and delivered by Seller) and this Agreement constitutes, and at
the Closing such documents will constitute, the valid and binding obligations of
Seller, enforceable against Seller in accordance with their terms except as such
enforceability may be limited by applicable bankruptcy or other similar laws
affecting the rights and remedies of creditors generally as well as to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
Section 5.5 No Conflicts.

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Subject to the giving of all notices to third parties and the receipt of all
consents, approvals and waivers from third parties set forth in Schedule 5.13,
the execution, delivery and performance by Seller of this Agreement and the
consummation of the transactions contemplated herein will not (a) conflict with
or result in a breach of any provisions of the organizational documents of
Seller, (b) result in a material default (with due notice or lapse of time or
both) or the creation of any material lien or encumbrance or give rise to any
right of termination, cancellation or acceleration under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license or
agreement to which Seller is a party or which affect the Assets, (c) violate any
judgment, order, ruling, or decree in any material respect applicable to Seller
as a party in interest, or (d) violate any Laws in any material respect
applicable to Seller or any of the Assets.
Section 5.6 Liability for Brokers’ Fees.
Purchaser shall not directly or indirectly have any responsibility, liability or
expense, as a result of undertakings or agreements of Seller or its Affiliates
for brokerage fees, finder’s fees, agent’s commissions or other similar forms of
compensation in connection with this Agreement or any agreement or transaction
contemplated hereby.
Section 5.7 Litigation.
With respect to the Assets, Seller’s ownership, operation, development,
maintenance, or use of any of the Assets or the transactions contemplated
herein, except to the extent the foregoing relate to Environmental Laws or
Environmental Liabilities and except as set forth in Schedule 5.7, no
proceeding, arbitration, action, claim, suit, pending settlement, or other legal
proceeding of any kind or nature before or by any Governmental Body, arbitrator
or panel (each, a “Proceeding,” and collectively “Proceedings”) (including any
take-or-pay claims) to which Seller or any of its Affiliates is a party and
which relates to the Assets or the transactions contemplated herein or which are
reasonably likely to impair materially Seller’s ability to perform its
obligations under this Agreement is pending or, to Seller’s knowledge,
threatened against Seller or any of its Affiliates.
Section 5.8 Taxes and Assessments.
Except as disclosed in Schedule 5.8, during the period of Seller’s ownership of
the Assets, to Seller’s knowledge all ad valorem, property, production,
severance and similar taxes and assessments (including penalties and interest)
based on or measured by the ownership of the Assets, the production of
Hydrocarbons or the receipt of proceeds therefrom that have become due and
payable before the Effective Time are being properly paid, other than taxes
which are being contested in good faith.
Section 5.9 Compliance with Laws.
Except as disclosed on Schedule 5.9, the Assets are, and the ownership,
operation, development, maintenance, and use of any of the Assets are, in
material compliance with the provisions and requirements of all Laws of all
Governmental Bodies having jurisdiction with respect to the Assets, or the
ownership, operation, development, maintenance, or use of any of the Assets. No
notice in writing from any Governmental Body or other Person has been received
by Seller

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claiming any violation of or noncompliance with any Law with respect to the
Assets in any material respect. Notwithstanding the foregoing, Seller makes no
representation or warranty, express or implied, under this Section 5.9 relating
to any Environmental Liabilities or Environmental Law.
Section 5.10 Outstanding Capital Commitments.
As of the date hereof, there are no outstanding or proposed AFEs or other
commitments to make capital expenditures which are binding on the Assets and
which Seller reasonably anticipates will individually require expenditures by
the owner of the Assets after the Effective Time in excess of $50,000 (net to
Seller’s interest) other than those shown on Schedule 5.10.
Section 5.11 Imbalances.
Schedule 5.11 accurately sets forth in all material respects all of Seller’s
Imbalances as of the respective dates set forth therein, arising with respect to
the Assets.
Section 5.12 Bankruptcy.
There are no bankruptcy, reorganization, or receivership proceedings pending
against, being contemplated by, or, to Seller’s knowledge, threatened against
Seller.
Section 5.13 Transfer Requirements.
Except as shown on Schedule 5.13 the Assets and transactions contemplated by
this Agreement are not subject to any applicable Transfer Requirements or
Customary Post-Closing Consents.
Section 5.14 Preference Rights.
The Assets and transactions contemplated by this Agreement are not subject to
any applicable Preference Rights.
Section 5.15 Payment of Royalties.
All rentals, royalties, shut in royalties, overriding royalties, in-lieu
royalties and other payments due with respect to the Assets which accrued or are
attributable to the period prior to the date hereof have been properly and fully
paid, or are included within the suspense accounts referenced in Schedule 5.21.
Section 5.16 Oil and Gas Operations.
All Wells that have been drilled, completed, recompleted, worked-over, operated
or produced by Seller as “operator” have been drilled, completed, recompleted,
worked-over, operated and produced in accordance with generally accepted oil and
gas field practices in compliance in all material respects with the applicable
Leases, pooling and unit agreements, joint operating agreements and Laws. To
Seller’s knowledge, all Wells that have not been drilled, completed,
recompleted, worked-over, operated or produced by Seller as “operator” have been
drilled,

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completed, recompleted, worked-over, operated and produced in accordance with
generally accepted oil and gas field practices in compliance in all material
respects with applicable leases, pooling and unit agreements, joint operating
agreements and Laws. Except as provided in Schedule 5.16, Seller operates all of
the Assets and is the operator under each operating agreement listed on Schedule
5.23.
Section 5.17 Well Status; Plugging and Abandonment.
Neither Seller, nor to Seller’s knowledge, any third party operator, has
abandoned, or is in the process of plugging and abandoning, any Wells associated
with the Properties. Except as provided in Schedule 5.17, there are no wells
associated with the Properties:
(a) with respect to which Seller, or, to Seller’s knowledge, any other Person,
has received a governmental order requiring that such well be plugged and
abandoned that has not been plugged and abandoned; or
(b) that have been plugged and abandoned by Seller, or, to Seller’s knowledge,
any other Person, that have not been plugged in accordance with applicable
requirements of each Governmental Body having jurisdiction over the well.
All wells, pits, tanks, salt water disposal facilities, pipelines, compressor
units and pits, and other facilities located on the Properties and no longer
used in connection with the ownership, operation, development, maintenance, or
use of any of the Assets have been filled, plugged, removed and/or abandoned in
compliance with all Laws in all material respects. Seller has not installed (and
to Seller’s knowledge, no other Person has installed) underground storage tanks
or unlined pits in, on or underlying any of the Assets.
Section 5.18 Non-Consent Operations.
No operations are being conducted or have been conducted with respect to the
Assets as to which Seller has elected to be a nonconsenting party under the
terms of the applicable operating agreement and with respect to which Seller has
not yet recovered its full participation.
Section 5.19 Permits.
Seller possesses all material permits, licenses, orders, approvals, variances,
waivers, franchises, rights, and other authorizations, required to be obtained
from any Governmental Body for conducting its business with respect to the
Assets as presently conducted, such authorizations are currently in full force
and effect, there are no material uncured violations of the terms and provision
of such authorizations, and no written notices of violation have been received
by Seller and no proceedings are pending or, to Seller’s knowledge, threatened,
that might result in any modification, revocation, termination or suspension of
any such authorizations or which would require any corrective or remediation
action by Seller.
Section 5.20 Tax Partnership.

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To Seller’s knowledge, none of the Assets is held by or is subject to any
contractual arrangement between Seller and any other Person, whether owning
undivided interests therein or otherwise, that is treated as or constitutes a
partnership for United States federal Tax purposes.
Section 5.21 Suspense Accounts.
Schedule 5.21, lists (i) all funds held in suspense by Seller as of the date set
forth on such Schedule 5.21 that are attributable to the Assets, (ii) a
description from Seller’s existing records of the source of such funds and the
reason they are being held in suspense and (iii) the names of the Persons
claiming such funds or to whom such funds are owed. Purchaser acknowledges that
royalties and payments owed with respect to the Assets are primarily paid by the
purchaser of the Hydrocarbons produced from such Assets. Consequently, Schedule
5.21 has been compiled based on Seller’s actual knowledge based on
representations from such purchasers.
Section 5.22 Insurance; Bonding.
Schedule 5.22 contains a true and complete list of (a) all policies of insurance
(other than officer’s and director’s liability policies) maintained by or for
the benefit of Seller as of the date hereof with respect to the ownership or
operation of the Assets and (b) all bonds, letters of credit and guarantees
posted by Seller or its Affiliates with Governmental Bodies or third parties
with respect to the ownership or operation of the Assets.
Section 5.23 Material Contracts.
(a) As of the date hereof, a true and complete copy of each Material Contract
has been provided to Purchaser and each Material Contract is listed on Schedule
5.23;
(b) Seller has not received or given written notice of default under any of the
Material Contracts or Leases (which default has not been cured or otherwise
resolved) and, to Seller’s knowledge, there is no event that, with the giving of
notice or the lapse of time or both, would constitute a default under any of the
Material Contracts or Leases;
(c) The Material Contracts are in full force and effect as to (and binding upon)
Seller and, to Seller’s knowledge, each counterparty thereto;
(d) Seller has not received written notices of (i) termination of any Lease or
Material Contract or (ii) the exercise of any premature termination, price
redetermination, market-out, or curtailment of any Material Contract; and
(e) There are no fines or penalties currently due and owing with respect to any
Material Contract.
Section 5.24 Environmental Matters.
(a) Except as set forth on Schedule 5.24:

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(i) The Assets have been used by Seller solely for oil and gas and related
operations. The Assets have not been used by Seller, or to the knowledge of
Seller, by anyone else, for the generation, treatment, storage, disposal,
processing, remediation, transportation or transmission of any Hazardous
Materials or as a landfill or other waste disposal site, other than for salt
water disposal, in each case, in compliance with Environmental Laws. There has
not been any spill, discharge, release, disposal or other handling of Hazardous
Materials on, in, through, from or under the Assets in violation of any
Environmental Laws.
(ii) The Seller has timely obtained, maintained in full force and effect, and
currently maintains in full force and effect, all permits, licenses,
authorizations, approvals, registrations, variances and certificates required
under Environmental Laws for the operation of the Assets (“Environmental
Permits”), and has made all notifications and filings required by, and otherwise
complied with, and is in compliance with, in all material respects, all
Environmental Laws applicable to the Assets and all Environmental Permits.
(iii) There is no pending, or to Seller’s knowledge, threatened investigation,
inquiry, hearing, administrative or other proceeding, order, notice, information
request, consent decree, order, complaint, citation, litigation, claim, action,
cause of action or suit, remedial obligation or settlement from, by or with any
Governmental Body or other third party alleging any failure to comply with,
violation of, or liability arising under Environmental Law or Environmental
Permits with respect to the Assets.
(iv) None of the Assets are currently listed on, or have ever been listed on,
any list or database of a Governmental Authority concerning Environmental
Defects, including, the National Priorities List.
(v) There are no Environmental Liabilities to any Governmental Body or to any
private person in connection with any release, discharge, spill, disposal,
storage, treatment, processing, remediation, transportation, transmission or
other handling of Hazardous Materials which would adversely affect the value of
the Assets.
(vi) Neither Seller nor any Affiliate of Seller (or third party operator of the
Assets) has filed or given any notice or report to any Governmental Body or
other third party indicating or reporting any past or present treatment,
storage, disposal, processing, remediation, transportation, transmission or
other handling, or any spill, discharge or release, of any Hazardous Materials
with respect to the Assets in violation of, or in a manner that could reasonably
be expected to result in liability under, Environmental Law or any Environmental
Permit.
(b) Set forth on Schedule 5.24 is a list of all environmental reports,
investigations and audits possessed or controlled by Seller (whether conducted
by or on behalf of Seller, a predecessor entity or a third party, and whether
done at the initiative of Seller, a predecessor entity or directed by any
Governmental Body or any other third party) relating to any matter addressed in
this Section 5.24, true, correct and complete copies of which have been provided
to Purchaser.

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Section 5.25 Mortgages and Other Instruments.
Except for the mortgages filed pursuant to that certain Credit Agreement between
Seller and Wells Fargo Bank, National Association, as Administrative Agent and
Collateral Agent and the lenders party thereto, there is no lien or security
interest in or on any Asset securing indebtedness for borrowed money has been
created by, through or under Seller or any Affiliate of Seller that burden any
of the Assets.
Section 5.26 Payments for Hydrocarbon Production.
Seller is not obligated under any contract or agreement for the sale of gas from
the Assets containing a take-or-pay, advance payment, prepayment or similar
provision, or under any gathering, transmission or any other contract or
agreement with respect to any of the Assets to gather, deliver, process or
transport any gas without then or thereafter receiving full payment therefor.
Except as provided in the Material Contracts set forth on Schedule 5.23, no
Person has any call upon, option to purchase, or similar rights with respect to
the production of Hydrocarbons produced from the Assets.
Section 5.27 Payout Balances.
None of the Wells and Units listed on Exhibit A-1 are subject to a reversion or
other adjustment at some level of cost recovery or payout (or passage of time or
other event other than termination of a Lease by its terms).
Section 5.28 Hedging.
None of the Assets is subject to or is bound by any futures, hedge, swap,
collar, put, call, option or other commodities contract or agreement that will
be binding upon the Purchaser or the Assets after the Closing.
ARTICLE 6
    

REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Seller the following:
Section 6.1 Existence and Qualification.
Purchaser is duly organized, validly existing and in good standing under the
laws of the state of its formation; and Purchaser is duly qualified to do
business, and is in good standing, in every jurisdiction in which it is required
to qualify in order to conduct its business; and Purchaser is or will be as of
Closing duly qualified to do business in each jurisdiction where the Assets are
located.
Section 6.2 Power.

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Purchaser has full power and authority to enter into and perform its obligations
under this Agreement and to consummate the transactions contemplated by this
Agreement.
Section 6.3 Authorization and Enforceability.
The execution, delivery and performance of this Agreement, and the performance
of the transactions contemplated hereby, have been duly and validly authorized
by all necessary management action on the part of Purchaser. This Agreement has
been duly executed and delivered by Purchaser (and all documents required
hereunder to be executed and delivered by Purchaser at Closing will be duly
executed and delivered by Purchaser) and this Agreement constitutes, and at the
Closing such 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).
Section 6.4 No Conflicts.
The execution, delivery and performance by Purchaser of this Agreement and the
consummation of the transactions contemplated herein will not conflict with or
result in a breach of any provisions of the organizational or other governing
documents of Purchaser nor will it violate any Laws in any material respect
applicable to Purchaser or any of its property.
Section 6.5 Liability for Brokers’ Fees.
Seller shall not directly or indirectly have any responsibility, liability or
expense, as a result of undertakings or agreements of Purchaser or its
Affiliates, for brokerage fees, finder’s fees, agent’s commissions or other
similar forms of compensation in connection with this Agreement or any agreement
or transaction contemplated hereby.
Section 6.6 Litigation.
There are no Proceedings pending, or, to the actual knowledge of Purchaser,
threatened in writing before any Governmental Body against Purchaser or any
Affiliate of Purchaser which are reasonably likely to impair materially
Purchaser’s ability to perform its obligations under this Agreement.
Section 6.7 Financing.
On or prior to the Closing Date, Purchaser will have sufficient cash or other
sources of immediately available funds (in each case, in United States dollars)
to enable it to pay the Closing Payment to Seller at the Closing and to
otherwise satisfy its obligations under this Agreement.
Section 6.8 Limitation.
Except for the representations and warranties expressly made by Seller in
Article 5 of this Agreement, in the Conveyances or confirmed in any certificate
furnished or to be furnished to

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Purchaser pursuant to this Agreement, Purchaser represents and acknowledges that
(i) there are no representations or warranties, express, statutory or implied,
as to the Assets or prospects thereof, and (ii) Purchaser has not relied upon
any oral or written information provided by Seller.
Section 6.9 SEC Disclosure.
Purchaser is acquiring the Assets for its own account for use in its trade or
business, and not with a view toward or for sale associated with any
distribution thereof, nor with any present intention of making a distribution
thereof within the meaning of the Securities Act of 1933, as amended, and
applicable state securities laws.
Section 6.10 Bankruptcy.
There are no bankruptcy, reorganization or receivership proceedings pending
against, being contemplated by, or, to Purchaser’s actual knowledge, threatened
against Purchaser.
Section 6.11 Qualification.
Purchaser shall be qualified at Closing to own and assume operatorship of
private, federal and state oil, gas and mineral leases in all jurisdictions
where the Assets to be transferred to it are located, and the consummation of
the transactions contemplated in this Agreement will not cause Purchaser to be
disqualified as such an owner or operator. To the extent required by the
applicable Law, as of the Closing, Purchaser will have lease bonds, area-wide
bonds or any other surety bonds as may be required by, and in accordance with,
such state or federal regulations governing the ownership and operation of the
Assets.
Section 6.12 Consents.
Except for Customary Post-Closing Consents and any Transfer Requirements
relating to the Assets, there are no consents or other restrictions on
assignment that Purchaser is obligated to obtain or furnish, including, but not
limited to, requirements for consents from third parties to any assignment (in
each case) that would be applicable in connection with the consummation of the
transactions contemplated by this Agreement by Purchaser.
Section 6.13 Independent Evaluation.
Purchaser is sophisticated in the evaluation, purchase, ownership and operation
of oil and gas properties and related facilities. In making its decision to
enter into this Agreement and to consummate the transactions contemplated
herein, Purchaser (a) has relied or shall rely solely on its own independent
investigation and evaluation of the Assets and the advice of its own legal, tax,
economic, insurance, environmental, engineering, geological and geophysical
advisors and the express provisions of this Agreement and not on any comments,
statements, projections or other materials made or given by any representatives
or consultants or advisors engaged by Seller, and (b) has satisfied or shall
satisfy itself through its own due diligence as to the environmental and
physical condition and state of repair of and contractual arrangements and other
matters affecting the Assets.

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Section 6.14 No Known Title or Environmental Defects
As of the execution date, Purchaser is not aware of any Title Defects or
Environmental Defects against the Assets for which it will submit a Title Defect
Notice or an Environmental Defect Notice.
ARTICLE 7
    

COVENANTS OF THE PARTIES
Section 7.1 Government Reviews.
Before and after the Closing, Seller and Purchaser shall in a timely manner (a)
make all required filings, if any, with and prepare applications to and conduct
negotiations with, each Governmental Body as to which such filings, applications
or negotiations are necessary or appropriate in the consummation of the
transactions contemplated hereby and (b) provide such information as each may
reasonably request to make such filings, prepare such applications and conduct
such negotiations. Each party shall cooperate with and use all commercially
reasonable efforts to assist the other with respect to such filings,
applications and negotiations.
Section 7.2 Notification of Breaches.
Until the Closing,
(a) Purchaser shall notify Seller promptly after Purchaser obtains actual
knowledge that any representation or warranty of Seller contained in this
Agreement is untrue in any material respect or will be untrue in any material
respect as of the Closing Date, or that any covenant or agreement to be
performed or observed by Seller prior to or on the Closing Date has not been so
performed or observed in any material respect.
(b) Seller shall notify Purchaser promptly after Seller obtains actual knowledge
that any representation or warranty of Purchaser contained in this Agreement is
untrue in any material respect or will be untrue in any material respect as of
the Closing Date, or that any covenant or agreement to be performed or observed
by Purchaser prior to or on the Closing Date has not been so performed or
observed in any material respect.
(c) Without limiting a party’s rights under Section 10.1(c) or Section 10.1(d),
if any of Purchaser’s or Seller’s representations or warranties is untrue or
shall become untrue in any material respect between the date of execution of
this Agreement and the Closing Date, or if any of Purchaser’s or Seller’s
covenants or agreements to be performed or observed prior to or on the Closing
Date shall not have been so performed or observed in any material respect, but
if such breach of representation, warranty, covenant or agreement shall (if
curable) be cured by the Closing, then such breach shall be considered not to
have occurred for all purposes of this Agreement. No such notification under
subsection (a) or (b) above shall affect the representations or warranties of
the parties or the conditions to their respective obligations hereunder.

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(d) There shall be no breach of the covenants in this Section as a result of a
party’s failure to report a breach of any representation or warranty or a
failure to perform or observe any covenant or agreement of which it had actual
knowledge if the party subject to the breach or failure also had actual
knowledge thereof prior to Closing.
Section 7.3 Letters-in-Lieu; Assignments; Operatorship.
(a) Seller will execute on the Closing Date letters in lieu of division and
transfer orders relating to the Assets, on forms prepared by Purchaser (with the
cooperation of Seller) and reasonably satisfactory to Seller, directing all
purchasers of production to make payment to Purchaser of proceeds attributable
to production from the Assets from and after the Effective Time to reflect the
transaction contemplated hereby.
(b) Seller will prepare (with the cooperation of Purchaser) and execute, and
Purchaser will execute, on the Closing Date, all assignments necessary to convey
to Purchaser all federal and state Leases (if any) in the form as prescribed by
the applicable Governmental Body and otherwise acceptable to Purchaser and
Seller.
(c) Seller will reasonably assist Purchaser in Purchaser’s efforts to succeed
Seller as operator of any Wells and Units included in the Assets. Purchaser
shall, promptly following Closing, file all appropriate forms and declarations
or bonds with federal and state agencies relative to its assumption of
operatorship of the Assets. At Closing, for all Seller Operated Assets, Seller
shall execute and deliver to Purchaser, on forms to be supplied by Purchaser
(with the cooperation of Seller), and Purchaser shall promptly file, the
appropriate forms with the applicable regulatory agency transferring
operatorship of such Assets to Purchaser.
Section 7.4 Public Announcements.
Until the Closing, neither Seller nor Purchaser shall make, or permit any agent
or Affiliate to make, any press release or other public announcement regarding
the existence of this Agreement, the contents hereof or the transactions
contemplated hereby without the prior written consent of the other party;
provided, however, the foregoing shall not restrict disclosures by Purchaser or
Seller which are required by applicable securities or other Laws or regulations
or the applicable rules of any stock exchange having jurisdiction over the
disclosing party or its Affiliates. At or after Closing, the content of any
press release or public announcement first announcing the consummation of this
transaction shall be subject to the prior review and reasonable approval of
Seller and Purchaser; provided, however, the foregoing shall not restrict
disclosures by Purchaser or Seller which are required by applicable securities
or other Laws or regulations or the applicable rules of any stock exchange
having jurisdiction over the disclosing party or its Affiliates.
Section 7.5 Operation of Business.
Except as set forth on Schedule 7.5, until the Closing, Seller (a) will operate
the Assets and the business thereof in the ordinary course, (b) will cause the
Assets to be maintained and operated in a prudent, good and workmanlike manner
and pay or cause to be paid all costs and expenses in connection therewith
promptly when due (including, all rentals, royalties, shut in royalties,

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overriding royalties and in-lieu royalties), (c) will maintain Seller's
relationships with suppliers, customers and others having business relations
with Seller with respect to the ownership or operation of the Assets so that
they will be preserved for Purchaser on and after the Closing Date, (d) will
not, without the prior written consent of Purchaser, which consent shall not be
unreasonably withheld, (i) commit to any operation, or series of related
operations, reasonably anticipated to require future capital expenditures by
Purchaser as owner of the Assets in excess of $50,000, proportionate to Seller’s
working interest, (ii) make any capital expenditures in respect of the Assets in
excess of $50,000, proportionate to Seller’s working interest, (iii) agree not
to participate in any operation, (iv) terminate, materially amend, or extend any
Material Contracts, (v) grant or create any Preference Right or Transfer
Requirement with respect to the Assets, (vi) enter into any contract or
agreement which, if entered into prior to the date of this Agreement, would have
been required to be listed as a Material Contract on Schedule 5.23, (vii) enter
into any settlement of any pending or threatened Proceeding relating to the
Assets or consent to the entry of any decree or order by a Governmental Body
with respect to the Assets or (viii) voluntarily relinquish Seller's position as
operator with respect to any of the Seller Operated Assets; (e) will maintain
insurance coverage on the Assets presently furnished by nonaffiliated third
parties in the amounts and of the types presently in force, (f) will use
commercially reasonable efforts to maintain in full force and effect all Leases,
(g) will maintain all governmental permits and approvals affecting the Assets,
(h) will not transfer, farmout, sell, hypothecate, encumber or otherwise dispose
of any Assets except for sales and dispositions of Hydrocarbon production and
Equipment made in the ordinary course of business consistent with past
practices, (i) will give prompt written notice to Purchaser of any notice of
default (or threat of default, whether disputed or denied) received or given by
Seller under any instrument or agreement affecting the Assets to which Seller is
a party or by which Seller of any of the Assets are bound and (j) will not
commit to do any of the foregoing. Purchaser’s approval of any action restricted
by this Section 7.5 shall be considered granted within ten (10) days (unless a
shorter time is reasonably required by the circumstances and such shorter time
is specified in Seller’s written notice) of Seller’s written notice to Purchaser
requesting such consent unless Purchaser notifies Seller to the contrary in
writing during that period. In the event of an emergency, Seller may take such
action as a reasonably prudent operator would take and shall notify Purchaser of
such action promptly thereafter.
Purchaser acknowledges that Seller may own an undivided interest in certain of
the Assets, and Purchaser agrees that the acts or omissions of the other working
interest owners who are not affiliated with Seller shall not constitute a
violation of the provisions of this Section 7.5 nor shall any action required by
a vote of working interest owners constitute such a violation so long as Seller
has voted its interest in a manner consistent with the provisions of this
Section 7.5, provided that until the Closing Seller shall use commercially
reasonable efforts to provide Purchaser with notice of any such actions, but
shall have no liability to Purchaser for any failure to so notify.
Section 7.6 Transfer Requirements.
(a) The transactions contemplated by this Agreement are expressly subject to all
validly existing and applicable Transfer Requirements, including those that are
listed on Schedule 5.13. Promptly after the execution hereof, Seller shall
initiate all procedures which are required to

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comply with or obtain the waiver of all applicable Transfer Requirements with
respect to the transactions contemplated by this Agreement.
(b) If a Transfer Requirement applicable to the transactions contemplated by
this Agreement is not obtained, complied with or otherwise satisfied prior to
the Closing Date, then, at Purchaser’s option, any Asset or portion thereof
affected by such Transfer Requirement (a “Retained Asset”) shall be held back
from the Assets to be transferred and conveyed to Purchaser at Closing and the
Purchase Price to be paid at Closing shall be reduced by an amount equal to the
Allocated Value of such Asset. Any Retained Asset so held back at the initial
Closing will be conveyed to Purchaser within ten (10) days following the date on
which Seller obtains, complies with or otherwise satisfies all Transfer
Requirements with respect to such Retained Asset for a purchase price equal to
the amount by which the Purchase Price was reduced on account of the holding
back of such Retained Asset; provided, however, that if all Transfer
Requirements with respect to any Retained Assets so held back at the initial
Closing are not obtained, complied with or otherwise satisfied within ninety
(90) days following the Closing Date, then Purchaser shall have the right to
elect in writing to (a) have such Retained Assets eliminated from the Assets and
this Agreement or (b) waive the Transfer Requirements which have not been
obtained, complied with or satisfied with respect to such Retained Assets, in
which case Seller shall immediately convey such Retained Asset to Purchaser for
the portion of the Purchase Price withheld with respect thereto. Any subsequent
conveyance of a Retained Asset will be subject to all Closing requirements and
conditions applicable to the initial Closing hereunder and appropriate
adjustments to Purchase Price in accordance with the provisions of Section 2.2
will be made to account for any delayed Closing with respect to a Retained
Asset.
(c) Seller shall use its commercially reasonable efforts to obtain all
applicable consents; provided, however, Seller shall not be obligated to pay any
consideration to (or incur any cost or expense for the benefit of) the holder of
any Transfer Requirement in order to obtain compliance therewith.

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Section 7.7 Tax Matters.
Subject to the provisions of Section 12.3, Purchaser shall be responsible for
all Taxes related to the Assets (other than ad valorem, property, severance,
Hydrocarbon production and similar Taxes based upon or measured by the ownership
or operation of the Assets or the production of Hydrocarbons therefrom, which
are addressed in Section 1.4, and income, franchise and similar Taxes).
Notwithstanding the foregoing, Seller shall handle payment to the appropriate
Governmental Body of all Taxes with respect to the Assets which are required to
be paid prior to Closing (and shall file all Tax Returns with respect to such
Taxes). If requested by Purchaser, Seller will assist Purchaser with preparation
of all ad valorem and property Tax Returns for periods ending on or before the
Closing Date (including any extensions requested). Seller shall deliver to
Purchaser within thirty (30) days of filing copies of all Tax Returns to be
filed by Seller relating to the Assets and any supporting documentation to be
provided by Seller to Governmental Bodies for Purchaser’s approval, which shall
not be unreasonably withheld, excluding Tax Returns related to income tax,
franchise tax, or other similar Taxes. Purchaser shall file all Tax Returns
covering Taxes treated as Property Costs that are required to be filed after the
Closing Date unless covered above.
Section 7.8 Further Assurances.
After Closing, Seller and Purchaser each agrees to take such further actions
(including using commercially reasonable efforts to obtain all applicable
Customary Post-Closing Consents) and to execute, acknowledge and deliver all
such further documents, including any further instruments of conveyance and
transfer, as are reasonably requested by the other party for carrying out the
purposes of this Agreement or of any document delivered pursuant to this
Agreement. Additionally, prior to Closing, Seller agrees to cooperate with
Purchaser to negotiate a mutually agreeable contract related to the supply of
water to the Midwell Unit from the Tepee Creek Unit on terms similar to those
terms contained in the Appleby Water Supply Agreement dated January 2016.
Section 7.9 Insurance.
Effective as of the Closing Date, Purchaser shall cause the following insurance
to be carried and maintained with respect to the Assets: (i) general liability
insurance with combined single limits per occurrence of not less than
$1,000,000.00 for bodily injury and property damage, including property damage
by completed operations, and contractual liability as respects any contract into
which Purchaser may enter under the terms of this Agreement; and (ii) any other
policies identified in Section 8.1(h).
Section 7.10 Record Retention.
Purchaser, for a period of seven (7) years following Closing, will (i) retain
the Records, (ii) provide Seller, its Affiliates and its and their officers,
employees and representatives with access to the Records (to the extent that
Seller has not retained a copy) during normal business hours for review and
copying at Seller’s expense and upon reasonable notice, and (iii) provide
Seller, its Affiliates and its and their officers, employees and representatives
with access, during normal business hours, to materials received or produced
after Closing relating to any indemnity claims made under Sections 11.3 and 11.4
of this Agreement for review and copying at Seller’s expense.

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If Purchaser shall desire to dispose of or transfer any such Records or other
materials upon or after the expiration of such seven-year period, Purchaser
shall, prior to any disposition, give Seller notice and a reasonable opportunity
at Seller’s expense to segregate and remove or copy such Records or other
materials as Seller may select.
Section 7.11 Bonds, Letters of Credit and Guarantees
Purchaser acknowledges that none of the bonds, letters of credit and guarantees
set forth on Schedule 5.22 posted by Seller or its Affiliates with Governmental
Bodies or third parties and relating to the Assets are transferable to
Purchaser. Except to the extent that Purchaser will, as of Closing, be covered
by the bonds of the operators of the applicable Assets, then on or before the
Closing Date, Purchaser shall obtain, or cause to be obtained in the name of
Purchaser, and make available replacements for such bonds, letters of credit and
guarantees. After Closing, Purchaser shall reasonably cooperate with Seller to
obtain cancellation of the bonds, letters of credit and guarantees posted by
Seller and/or its Affiliates that are related solely to the Assets conveyed to
Purchaser.
Section 7.12 Cure of Misrepresentations.
If any of the representations and warranties contained in Articles 5 or 6 hereof
are determined (whether by notice from a party or otherwise) to have been untrue
or incorrect as of the date of this Agreement, then any cure by the party making
such representations and warranties shall be at such party’s own expense.

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Section 7.13 Plugging, Abandonment, Decommissioning and Other             Costs.
In addition to its other obligations under this Agreement, Purchaser shall
comply with all Laws, Leases, Contracts (including all joint and unit operating
agreements) and prevailing industry standards relating to (i) the plugging,
abandonment and/or replugging of all Wells, including inactive Wells or
temporarily abandoned Wells, included in the Assets, (ii) the dismantling or
decommissioning and removal of any Equipment and other property of whatever kind
related to or associated with operations and activities conducted by the owner
or operator on the Properties, pursuant to the Leases or Applicable Contracts
and (iii) the clean up, restoration and/or remediation of the property covered
by the Leases or related to the Assets (collectively, “P&A Obligations”).
Section 7.14 Employees.
Schedule 7.14 sets forth a list of all current employees or contractors of
Seller and its Affiliates involved in the current day-to-day operation,
development, maintenance or use of any of the Assets and until the Closing,
Seller shall use commercially reasonable efforts to facilitate discussions
between Purchaser and each such employee or contractor regarding the possibility
of Purchaser hiring such employees or contractors to continue their involvement
in the day-to-day operation, development, maintenance or use of any of the
Assets after Closing; provided, however, that Purchaser shall not be obligated
to hire any such employees or contractors.
Section 7.15 Satisfaction of Conditions.
Seller and Purchaser will each use commercially reasonable efforts to take all
actions and to do all things necessary to consummate, make effective and comply
with all of the terms of this Agreement (including satisfaction, but not waiver,
of the conditions to Closing for which such party is responsible or otherwise in
control).
ARTICLE 8
    

CONDITIONS TO CLOSING
Section 8.1 Conditions of Seller to Closing.
The obligations of Seller to consummate the transactions contemplated by this
Agreement are subject, at the option of Seller, to the satisfaction or waiver by
Seller on or prior to Closing of each of the following conditions:
(a) Each of the representations and warranties of Purchaser contained in this
Agreement shall be true and correct in all material respects (other than those
representations and warranties of Purchaser that are qualified by materiality,
which shall be true and correct in all respects) as of the Closing Date as
though made on and as of the Closing Date, except to the extent that any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct in all material
respects (other than those

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representations and warranties of Purchaser that are qualified by materiality,
which shall be true and correct in all respects) as of such specified date;
(b) Purchaser shall have performed and observed, in all material respects, all
covenants and agreements to be performed or observed by it under this Agreement
prior to or on the Closing Date;
(c) No Proceeding by a third party (including any Governmental Body) seeking to
restrain, enjoin or otherwise prohibit the consummation of the transactions
contemplated by this Agreement shall be pending or threatened before any
Governmental Body and no order, writ, injunction or decree shall have been
entered and be in effect by any court or any Governmental Body of competent
jurisdiction, and no statute, rule, regulation or other requirement shall have
been promulgated or enacted and be in effect, that on a temporary or permanent
basis restrains, enjoins or invalidates the transactions contemplated hereby;
(d) Purchaser shall have delivered (or be ready, willing and able to immediately
deliver) to Seller duly executed counterparts of the Conveyances and all other
documents and certificates to be delivered by Purchaser under Section 9.3 and
shall have performed (or be ready, willing and able to immediately perform) the
other obligations required to be performed by it under Section 9.3 (including,
without limitation, delivery of the Closing Payment);
(e) The sum of (i) all uncured Title Defect Amounts for Material Title Defects
determined under Section 3.4(g) prior to Closing, plus (ii) the Allocated Value
of all Properties retained by Seller pursuant to Section 3.4(d)(ii), plus (iii)
all Title Defect Amounts asserted by Purchaser for all Title Defects and Title
Defect Amounts that have not been agreed upon by the parties, less (iv) the sum
of all Title Benefit Amounts for Material Title Benefits determined under
Section 3.4(h) prior to the Closing, plus (v) Environmental Defects Amounts
attributable to Material Environmental Defects, determined or asserted in
accordance with this Agreement, plus (vi) all Environmental Defect Amounts
asserted by Purchaser for all Environmental Defects and Environmental Defect
Amounts that have not been agreed upon by the parties, plus (vii) the Allocated
Value of all Properties retained by Seller pursuant to Section 4.3, plus (viii)
the sum of the aggregate reductions in the Purchase Price determined under
Section 7.6(b), shall be less than ten percent (10%) of the total unadjusted
Purchase Price;
(f) The sum of all Losses from casualties to and takings of the Assets,
determined or asserted in accordance with this Agreement, shall be less than
twenty percent (20%) of the unadjusted Purchase Price;
(g) Purchaser shall have obtained, or caused to be obtained, in the name of
Purchaser, and made available replacements for Seller’s and/or its Affiliates’
bonds, letters of credit and guaranties, if any, to the extent required by the
second sentence of Section 7.11; and
(h) Purchaser shall have furnished Seller with certificates of insurance on
forms reasonably acceptable to Seller which list Purchaser’s insurance policies
relating to the Assets, including (i) insurance which complies with all
applicable workers’ compensation and occupational disease laws covering all of
Purchaser’s employees performing any work or activities as to oil and

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gas leasehold interests subject to this Agreement, (ii) commercial general
liability insurance (including contractual liability coverage) and pollution
liability insurance, (iii) excess liability insurance (including contractual
liability coverage) of at least $4,000,000, and (iv) such other insurance and
proof of financial responsibility as is required under the applicable Laws.
Section 8.2 Conditions of Purchaser to Closing.
The obligations of Purchaser to consummate the transactions contemplated by this
Agreement are subject, at the option of Purchaser, to the satisfaction or waiver
by Purchaser on or prior to Closing of each of the following conditions:
(a) Each of the representations and warranties of Seller contained in this
Agreement shall be true and correct in all material respects (other than those
representations and warranties of Seller that are qualified by materiality,
which shall be true and correct in all respects) as of the Closing Date as
though made on and as of the Closing Date, except to the extent that any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct in all material
respects (other than those representations and warranties of Seller that are
qualified by materiality, which shall be true and correct in all respects) as of
such specified date;
(b) Seller shall have performed and observed, in all material respects, all
covenants and agreements to be performed or observed by it under this Agreement
prior to or on the Closing Date;
(c) No Proceeding by a third party (including any Governmental Body) seeking to
restrain, enjoin or otherwise prohibit the consummation of the transactions
contemplated by this Agreement shall be pending or threatened before any
Governmental Body and no order, writ, injunction or decree shall have been
entered and be in effect by any court or any Governmental Body of competent
jurisdiction, and no statute, rule, regulation or other requirement shall have
been promulgated or enacted and be in effect, that on a temporary or permanent
basis restrains, enjoins or invalidates the transactions contemplated hereby;
(d) Seller shall have delivered (or be ready, willing and able to immediately
deliver) to Purchaser duly executed counterparts of the Conveyances and all
other documents and certificates to be delivered by Seller under Section 9.2 and
shall have performed (or be ready, willing and able to immediately perform) the
other obligations required to be performed by it under Section 9.2;
(e) The sum of (i) all uncured Title Defect Amounts for Material Title Defects
determined under Section 3.4(g) prior to Closing, plus (ii) the Allocated Value
of all Properties retained by Seller pursuant to Section 3.4(d)(ii), plus (iii)
all Title Defect Amounts asserted by Purchaser for all Title Defects and Title
Defect Amounts that have not been agreed upon by the parties, less (iv) the sum
of all Title Benefit Amounts for Material Title Benefits determined under
Section 3.4(h) prior to the Closing, plus (v) Environmental Defects Amounts
attributable to Material Environmental Defects, determined or asserted in
accordance with this Agreement, plus (vi) all Environmental Defect Amounts
asserted by Purchaser for all Environmental Defects and Environmental Defect
Amounts that have not been agreed upon by the parties, plus (vii) the Allocated

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Value of all Properties retained by Seller pursuant to Section 4.3, plus (viii)
the sum of the aggregate reductions in the Purchase Price determined under
Section 7.6(b), shall be less than ten percent (10%) of the total unadjusted
Purchase Price;
(f) The sum of all Losses from casualties to and takings of the Assets,
determined or asserted in accordance with this Agreement, shall be less than
twenty percent (20%) of the unadjusted Purchase Price; and
(g) Seller shall have delivered to Purchaser all consents, authorizations and
approvals that are (i) required to be obtained under each of the operating
agreements listed on Schedule 5.23 from any one or more parties to such
agreements in order to appoint and elect Purchaser as successor operator
thereunder as of the Closing and (ii) reasonably acceptable to Purchaser.
ARTICLE 9
    

CLOSING
Section 9.1 Time and Place of Closing.
(a) Unless this Agreement shall have been terminated and the transactions herein
contemplated shall have been abandoned pursuant to Article 10, and subject to
the satisfaction or waiver of the conditions set forth in Article 8 (other than
conditions the fulfillment of which by their nature is to occur at the
completion of the transactions contemplated by this Agreement (the “Closing”)),
the Closing shall take place at 10:00 a.m., local time, on July 29, 2016, at
Seller’s offices in Dallas, Texas, unless another date, time or place is
mutually agreed to in writing by Purchaser and Seller. If any of the conditions
(other than conditions the fulfillment of which by their nature is to occur at
the Closing) set forth in Article 8 are not satisfied or waived at the time the
Closing is to occur pursuant to the foregoing sentence of this Section 9.1(a),
then subject to Article 10 the Closing shall occur on a date thereafter that is
the third Business Day after the satisfaction or waiver of all such conditions.
(b) The date on which the Closing occurs is herein referred to as the “Closing
Date.”
Section 9.2 Obligations of Seller at Closing.
At the Closing, upon the terms and subject to the conditions of this Agreement,
Seller shall deliver or cause to be delivered to Purchaser, or perform or cause
to be performed, the following:
(a) the Conveyances in sufficient duplicate originals to allow recording in all
appropriate jurisdictions and offices, and any other conveyances on official
forms and related documentation necessary to transfer the Assets to Purchaser in
accordance with the requirements of any Governmental Body, duly executed by
Seller;

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(b) letters-in-lieu of transfer orders contemplated by Section 7.3, duly
executed by Seller;
(c) a certificate duly executed by an authorized corporate officer of Seller,
dated as of Closing, certifying on behalf of Seller that the conditions set
forth in Section 8.2(a) and Section 8.2(b) have been fulfilled;
(d) a certificate duly executed by an authorized corporate officer of Seller,
dated as of the Closing, (i) attaching and certifying on behalf of Seller
complete and correct copies of (x) the certificate of formation and the
operating agreement of Seller, each as in effect as of the Closing, and (y) the
resolution of the [managers] of Seller authorizing the execution, delivery and
performance by Seller of this Agreement and the transactions contemplated
hereby, and (ii) certifying on behalf of Seller the incumbency of each
authorized representative of Seller executing this Agreement or any document
delivered in connection with the Closing;
(e) the Preliminary Closing Statement;
(f) an executed statement described in Treasury Regulation 1.1445-2(b)(2)
certifying that Seller is not a foreign person within the meaning of the Code;
(g) any other agreements, instruments and documents which are required by other
terms of this Agreement to be executed and/or delivered at Closing;
(h) full releases, effective as of the Closing, of all liens and security
interests securing indebtedness for borrowed money created by, through or under
Seller or any of its Affiliates that burden any of the Assets; and
(i) all written consents, authorizations and approvals required pursuant to
Section 8.2(g).
Section 9.3 Obligations of Purchaser at Closing.
At the Closing, upon the terms and subject to the conditions of this Agreement,
Purchaser shall deliver or cause to be delivered to Seller, or perform or cause
to be performed, the following:
(a) a wire transfer of the Closing Payment, in same-day funds to an account or
accounts designated in writing by Seller at least three (3) Business Days before
Closing;
(b) the Conveyances and any other conveyances on official forms and related
documentation necessary to transfer the Assets to Purchaser in accordance with
the requirements of any Governmental Body, duly executed by Purchaser;
(c) letters-in-lieu of transfer orders contemplated by Section 7.3, duly
executed by Purchaser;
(d) a certificate by an authorized officer of Purchaser, dated as of Closing,
certifying on behalf of Purchaser that the conditions set forth in Sections
8.1(a) and 8.1(b) have been fulfilled;

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(e) the Preliminary Closing Statement; and
(f) any other agreements, instruments and documents which are required by other
terms of this Agreement to be executed and/or delivered at Closing.
Section 9.4 Closing Adjustments and Closing Payment.
(a) Not later than five (5) Business Days prior to the Closing Date, Seller
shall prepare and deliver to Purchaser, based upon the information reasonably
available to Seller, a preliminary settlement statement reasonably estimating
the Adjusted Purchase Price after giving effect to all adjustments listed in
Sections 2.2 and Section 2.3 (the “Preliminary Closing Statement”). The estimate
delivered in accordance with this Section 9.4(a) shall constitute the dollar
amount to be paid by Purchaser to Seller at the Closing (the “Closing Payment”).
Within three (3) Business Days after receipt of the Preliminary Closing
Statement, Purchaser may deliver to Seller a written report containing all
changes with the explanation therefor that Purchaser proposes to be made to the
Preliminary Closing Statement. The Preliminary Closing Statement, as agreed upon
by the parties hereto, will be used to determine the amount of the Closing
Payment. If the parties hereto are unable to reach agreement, the Preliminary
Closing Statement as prepared by Seller will be used to determine the Closing
Payment, absent manifest error.
(b) As soon as reasonably practicable after the Closing but not later than
ninety (90) days following the Closing Date, Seller shall prepare and deliver to
Purchaser a statement (the “Final Closing Statement”) setting forth the final
calculation of the Purchase Price and showing the calculation of each
adjustment, based, to the extent possible, on actual credits, charges, receipts
and other items before and after the Effective Time and taking into account all
adjustments provided for in this Agreement (the “Final Purchase Price”). Seller
shall, at Purchaser’s request, supply reasonable documentation available to
support any credit, charge, receipt or other item. Seller shall afford Purchaser
and its representatives the opportunity to review such statement and the
supporting schedules, analyses, work papers, and other underlying records or
documentation as are reasonably necessary and appropriate in Purchaser’s review
of such statement. Each party shall cooperate fully and promptly with the other
and their respective representatives in such examination with respect to all
reasonable requests related thereto. As soon as reasonably practicable but not
later than the 30th day following receipt of Seller’s statement hereunder,
Purchaser shall deliver to Seller a written report containing any changes that
Purchaser proposes be made to such statement. Seller and Purchaser shall
undertake to agree on the final statement of the Final Purchase Price on a date
that is no later than October 31, 2016 (such date, the “Final Settlement Date”).
Unless the parties are unable to reach agreement on the Final Closing Statement
on or before the Final Settlement Date, then on the Final Settlement Date, (x)
Purchaser shall pay to Seller the amount by which the Final Purchase Price
exceeds the Closing Payment or (y) Seller shall pay to Purchaser the amount by
which the Closing Payment exceeds the Final Purchase Price, as applicable (in
either case, the “Final Adjustment”).
(c) In the event that Seller and Purchaser cannot reach agreement by the Final
Settlement Date, either party may refer the remaining matters in dispute to a
mutually agreed upon independent accounting firm, for review and final
determination (the “Agreed Accounting Firm”). If issues are submitted to the
Agreed Accounting Firm for resolution, Seller and Purchaser shall

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each enter into a customary engagement letter with the Agreed Accounting Firm at
the time the issues remaining in dispute are submitted to the Agreed Accounting
Firm. The Agreed Accounting Firm will be directed to (i) review the statement
setting forth Seller’s calculation of the Final Purchase Price and the records
relating thereto only with respect to items identified by Purchaser in its
written report containing changes to such statement that remain disputed
immediately following the Final Settlement Date and (ii) determine the final
adjustments in accordance with the terms of this Agreement. Each party shall
furnish the Agreed Accounting Firm such work papers and other records and
information relating to the objections in dispute as the Agreed Accounting Firm
may reasonably request and that are available to such party or its Affiliates
(and such parties’ independent public accountants). The parties will, and will
cause their representatives to, cooperate and assist in the conduct of any
review by the Agreed Accounting Firm, including, but not limited to, making
available books, records and, as available, personnel as reasonably required.
The Agreed Accounting Firm shall conduct the arbitration proceedings in Fort
Worth, Texas in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, to the extent such rules do not conflict with the terms
of this Section 9.4. The Agreed Accounting Firm’s determination shall be made
within thirty (30) days after submission of the matters in dispute and shall be
final and binding on both parties, without right of appeal and such decision
shall constitute an arbitral award upon which a judgment may be entered by a
court having jurisdiction thereof. In determining the proper amount of any
adjustment to the Final Purchase Price, the Agreed Accounting Firm shall not
increase the Final Purchase Price more than the increase proposed by Seller nor
decrease the Final Purchase Price more than the decrease proposed by Purchaser,
as applicable, and may not award damages or penalties to either party with
respect to any matter. Seller and Purchaser shall each bear its own legal fees
and other costs of presenting its case. Each party shall bear one-half of the
costs and expenses of the accounting firm. Within ten (10) Business Days after
the date on which the parties or the Agreed Accounting Firm, as applicable,
finally determines the disputed matters, (x) Purchaser shall pay to Seller the
amount by which the Final Purchase Price exceeds the Closing Payment or (y)
Seller shall pay to Purchaser the amount by which the Closing Payment exceeds
the Final Purchase Price, as applicable. Any post-Closing payment pursuant to
this Section 9.4(b) shall bear interest at the Agreed Interest Rate from (but
not including) the Closing Date to (and including) the date both Purchaser and
Seller have executed the final settlement statement. The parties acknowledge
that it is not the intent of this Agreement that either party be deprived of
material amounts of revenue or be burdened by material amounts of expense until
the final adjustment pursuant to Section 9.4(b). If at any time after Closing
either party believes it is owed material revenues or material expense
reimbursement, which revenues and expense reimbursement owed shall be netted
against revenues and expenses due the other party, it may request payment from
the other party, not more frequently than monthly, and such party shall make
payment of any undisputed amounts within a commercially reasonable period of
time. For purposes of the immediately preceding sentence, material shall mean an
amount in excess of $500,000.
(d) All payments made or to be made hereunder to Seller shall be by electronic
transfer of immediately available funds to the account of Seller as may be
specified by Seller in writing. All payments made or to be made hereunder to
Purchaser shall be by electronic transfer of immediately available funds to a
bank and account specified by Purchaser in writing to Seller. Upon execution of
the Final Closing Statement by the parties and the payment of the Final
Adjustment by one party to the other, neither party shall have any further
obligation for any additional

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adjustments to the Purchase Price under Section 2.2. Notwithstanding anything in
this Agreement to the contrary, after the Final Settlement Date, (i) if a party
receives revenues that belong to the other party under this Agreement, the party
receiving the revenues agrees to promptly remit those revenues to the other
party, and (ii) if a party pays Property Costs when the other party is required
to pay pursuant to Section 1.2(c), the party on whose behalf the Property Costs
were paid agrees to promptly reimburse the other party for the Property Costs
paid on its behalf upon receiving satisfactory evidence of such payment;
provided, however, that neither party will be obligated to reimburse the other
party for any such Property Cost in excess of $10,000 unless it has been
consulted about that Property Cost prior to payment.
ARTICLE 10
    

TERMINATION
Section 10.1 Termination.
This Agreement may be terminated and the transactions contemplated hereby
abandoned at any time prior to the Closing:
(a) by mutual written consent of Seller and Purchaser;
(b) by either Seller or Purchaser, if:
(i) the Closing shall not have occurred on or before August 12, 2016 (the
“Termination Date”); provided, however, that no party shall have the right to
terminate this Agreement under this Section 10.1(b)(i) if such party is at such
time in material breach of any provision of this Agreement; or
(ii) there shall be any Law that makes consummation of the transactions
contemplated hereby illegal or otherwise prohibited or a Governmental Body shall
have issued an order, decree, or ruling or taken any other action permanently
restraining, enjoining, or otherwise prohibiting the consummation of the
transactions contemplated hereby, and such order, decree, ruling, or other
action shall have become final and non-appealable;
(c) by Seller, if (i) any of the representations and warranties of Purchaser
contained in this Agreement shall not be true and correct in all material
respects (provided that any such representation or warranty that is already
qualified by a materiality standard or a material adverse effect qualification
shall not be further qualified); or (ii) Purchaser shall have failed to fulfill
in any material respect any of its obligations under this Agreement required to
be performed prior to Closing; and, in the case of each of clauses (i) and (ii),
such misrepresentation, or breach of warranty or failure, if curable, has not
been cured within ten (10) days after written notice thereof from Seller to
Purchaser; provided that any cure period shall not extend beyond the Termination
Date and shall not extend the Termination Date;
(d) by Purchaser, if (i) any of the representations and warranties of Seller
contained in this Agreement shall not be true and correct in all material
respects (provided that any such

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representation or warranty that is already qualified by a materiality or
Material Adverse Effect qualification shall not be further qualified); or (ii)
Seller shall have failed to fulfill in any material respect any of its
obligations under this Agreement required to be performed prior to Closing, and,
in the case of each of clauses (i) and (ii), such misrepresentation, breach of
warranty or failure, if curable, has not been cured within ten (10) days after
written notice thereof from Purchaser to Seller; provided that any cure period
shall not extend beyond the Termination Date and shall not extend the
Termination Date; or
(e) by either Seller or Purchaser pursuant to Section 3.5(b).
Section 10.2 Effect of Termination.
If this Agreement is terminated pursuant to Section 10.1, this Agreement shall
become void and of no further force or effect (except for the provisions of
Section 4.4, Section 5.6, Section 6.5, Section 7.4, Section 11.7, Section 11.8,
Section 11.9, Section 11.11 and Section 11.12 of this Agreement and this Article
10, the Section entitled “Definitions,” and Article 12, all of which shall
continue in full force and effect). Notwithstanding the foregoing, nothing
contained in this Section 10.2 shall relieve any party from liability for Losses
resulting from its breach of this Agreement.
Section 10.3 Distribution of Deposit Upon Termination.
(a) If Seller terminates this Agreement solely (i) because any of the conditions
to Closing set forth in Section 8.1(a) or Section 8.1(b) have not been satisfied
or (ii) because of Purchaser’s refusal to close notwithstanding the satisfaction
of the conditions precedent set forth in Section 8.2 , then Seller may retain
the Deposit, as its sole and exclusive remedy as liquidated damages, free of any
claims by Purchaser or any other Person with respect thereto. It is expressly
stipulated by the parties that the actual amount of damages resulting from such
a termination would be difficult if not impossible to determine accurately
because of the unique nature of this Agreement, the unique nature of the Assets,
the uncertainties of applicable commodity markets and differences of opinion
with respect to such matters, and that the liquidated damages provided for
herein are a reasonable estimate by the parties of such damages. Upon such
termination by Seller, Seller shall be free immediately to enjoy all rights of
ownership of the Assets and to sell, transfer, encumber or otherwise dispose of
the Assets to any Person without any restriction under this Agreement.
(b) If this Agreement is terminated for any reason other than the reasons set
forth in Section 10.3(a), then Seller shall deliver within one (1) Business Day
thereafter the Deposit to Purchaser by electronic transfer of immediately
available funds to an account or accounts designated in writing by Purchaser,
without interest thereon, free of any claims by Seller or any other Person with
respect thereto, and Purchaser shall be entitled to all remedies available at
Law or in equity.
(c) Notwithstanding anything to the contrary in this Agreement, Purchaser shall
not be entitled to receive interest on the Deposit, whether the Deposit is
applied against the Purchase Price or returned to Purchaser pursuant to this
Section 10.3.

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ARTICLE 11
    

POST-CLOSING OBLIGATIONS; INDEMNIFICATION;
LIMITATIONS; DISCLAIMERS AND WAIVERS
Section 11.1 Assumed Seller Obligations.
Subject to the indemnification by Seller under Section 11.3, on the Closing
Date, Purchaser shall assume and hereby agrees to fulfill, perform, pay and
discharge (or cause to be fulfilled, performed, paid or discharged) all of the
obligations and liabilities of Seller, known or unknown, with respect to the
Assets, regardless of whether such obligations or liabilities arose prior to, on
or after the Effective Time, including but not limited to obligations to (a)
furnish makeup gas according to the terms of applicable gas sales, gathering or
transportation contracts, and to satisfy all other gas balancing obligations, if
any, (b) pay working interests, royalties, overriding royalties and similar
burdens affecting the Assets, and all amounts attributable to any such interests
held in suspense that are described on Schedule 5.21, (c) properly plug and
abandon any and all wells (including, without limitation, the Wells), including
inactive wells or temporarily abandoned wells, drilled on the Properties, as
required by applicable Law, (d) replug any well, wellbore, or previously plugged
well on the Properties to the extent required by a Governmental Body, (e)
dismantle, salvage and remove any equipment, structures, materials, platforms,
flow lines, and property of whatever kind related to or associated with
operations and activities conducted on the Properties, (f) clean up, restore
and/or remediate the premises covered by or related to the Assets in accordance
with applicable agreements and Laws, (g) pay all Property Costs, and (h) perform
all obligations applicable to or imposed on the lessee, owner, or operator under
the Leases or attributable to the ownership or operation of the Assets and
related Contracts, or as required by applicable Laws (all of said obligations
and liabilities, subject to the exclusions below, herein being referred to as
the “Assumed Seller Obligations”); provided, however, that notwithstanding any
other provision of this Agreement to the contrary, the Assumed Seller
Obligations shall not include, and Purchaser shall have no obligation to assume,
any obligations or liabilities of Seller to the extent that they are (such
excluded obligations and liabilities, the “Excluded Seller Obligations”):
(i) attributable to or arise out of the Excluded Assets;
(ii) except to the extent constituting Environmental Liabilities, all
obligations and liabilities to the extent attributable to or arising out of the
ownership, operation or use of any of the Assets on or before the Effective
Time;
(iii) attributable to or arising out of the actions, suits or proceedings, if
any, set forth on Schedule 5.7 or Schedule 5.24;
(iv) Retained Employee Liabilities and any liability or obligation for
compensation or reimbursement to any of Seller’s current or former employees for
work performed,

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including any liabilities or obligations related to or arising under any
employee benefit plan, express or implied contract, wages, bonuses, commissions
or severance benefits prior to Closing;
(v) Attributable to all Property Costs before the Effective Time;
(vi) the transport or disposal or the arrangement for transport or disposal of
any Hazardous Material prior to the Closing Date from the Properties to any
off-site location;
(vii) any fines, penalties and sanctions asserted, imposed or levied by any
Governmental Body resulting from any criminal investigation or proceedings
arising out of or related to Seller’s ownership, use, maintenance or operation
of the Assets; or
(viii) any death, physical injury or illness to any employees or contractors of
Seller related to or arising out of Seller’s ownership or operation of the
Assets.
Section 11.2 Survival.
(a) All representations and warranties of Seller and Purchaser contained herein
shall survive Closing until the 15 month anniversary of the Closing Date;
provided, however, that the representations and warranties contained in Section
5.2, Section 5.3, Section 5.4, Section 5.6, Section 6.1, Section 6.2, Section
6.3, and Section 6.5 (collectively, the “Fundamental Representations”) shall
survive until the expiration of the applicable statute of limitations period.
Upon the expiration of a representation or warranty in accordance with the
foregoing, such representation or warranty shall be deemed terminated and have
no further force or effect for any purpose under this Agreement, after which
time no claim may be made under such expired representation or warranty. The
parties intend to shorten the applicable statute of limitations as provided
herein.
(b) Except as provided in the remainder of this paragraph, the covenants and
other agreements of Seller and Purchaser set forth in this Agreement shall
survive the Closing Date until fully performed. Section 7.5 and all other
covenants and agreements that are expressly required to be performed by Seller
prior to Closing shall survive Closing until the 15 month anniversary of the
Closing Date. Section 7.9 shall survive the Closing until the 12 month
anniversary of the Closing Date. Seller’s indemnities under Section 11.3(a) and
Section 11.3(b) and Purchaser’s indemnities under Section 11.4(a) and Section
11.4(b) shall terminate as of the termination date of each respective
representation, warranty, covenant or agreement that is subject to
indemnification, except in each case as to matters for which a Claim Notice has
been delivered to the Indemnifying Party on or before such expiration date. All
other indemnity obligations shall survive until the expiration of the applicable
statute of limitations period.
(c) No party hereto shall have any indemnification obligation pursuant to this
Article 11 or otherwise hereunder unless it shall have received from the party
seeking indemnification a written notice (a “Claim Notice”) of the existence of
the claim for or in respect of which indemnification is being sought hereunder
on or before the expiration of the applicable survival period set forth in
Section 11.2. If an Indemnified Party delivers a Claim Notice with respect to a
representation or warranty to an Indemnifying Party before the expiration of the
applicable survival

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period set forth in Section 11.2, then the applicable representation, warranty,
covenant or agreement shall survive until, but only for purposes of, the
resolution of the matter covered by such Claim Notice. A Claim Notice shall set
forth with reasonable specificity (1) the basis for such claim under this
Agreement, and the facts that otherwise form the basis of such claim and (2) to
the extent reasonably estimable, an estimate of the amount of such claim (which
estimate shall not be conclusive of the final amount of such claim) and an
explanation of the calculation of such estimate.
Section 11.3 Indemnification by Seller.
From and after the Closing, subject to the terms and conditions of this Article
11 (including, without limitation, the survival and the timing requirement in
Section 11.2), Seller shall indemnify, defend and hold harmless, and shall pay
on a current basis, Purchaser and its Affiliates and its and their respective
directors, officers, employees, stockholders, managers, members, general
partners, equity owners, agents, consultants, advisors and other representatives
(including legal counsel, accountants and financial advisors) and the successors
and permitted assigns of this Agreement of Purchaser (collectively, the
“Purchaser Indemnified Persons”) from and against any and all Losses asserted
against, resulting from, imposed upon, or incurred or suffered by any Purchaser
Indemnified Person to the extent resulting from, arising out of or relating to:
(a) any breach of any representation or warranty of Seller contained in this
Agreement or confirmed in any certificate furnished by or on behalf of Seller to
Purchaser in connection with this Agreement;
(b) any breach or nonfulfillment of or failure to perform any covenant or
agreement of Seller contained in this Agreement or confirmed in any certificate
furnished by or on behalf of Seller in connection with this Agreement;
(c) any Excluded Seller Obligations; or
(d) Any other indemnity obligations of Seller contained herein.
Section 11.4 Indemnification by Purchaser.
From and after the Closing, subject to the adjustments to the Purchase Price for
purposes of the Closing Statements contained in Section 2.2 and Section 9.4 and
the terms and conditions of this Article 11 (including, without limitation, the
survival and timing requirements of Section 11.2), and except for Losses from
which Seller is required to indemnify Purchaser Indemnified Persons (subject to
all survival, timing, amount and other limitations hereunder) under this
Agreement, Purchaser shall indemnify, defend and hold harmless, and pay on a
current basis, Seller, Seller’s Affiliates, and each of their respective
directors, officers, employees, stockholders, managers, members, general
partners, equity owners, agents, consultants, advisors and other representatives
(including legal counsel, accountants and financial advisors) (all such persons
referred to collectively as the “Seller Indemnified Persons”) from and against
any and all Losses, asserted against, resulting from, imposed upon, or incurred
or suffered by any Seller Indemnified Person, directly or indirectly, to the
extent resulting from, arising out of, or relating to:

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(a) any breach of any representation or warranty of Purchaser contained in this
Agreement or confirmed in any certificate furnished by or on behalf of Purchaser
to Seller in connection with this Agreement REGARDLESS OF FAULT;
(b) any breach or nonfulfillment of or failure to perform any covenant or
agreement of Purchaser contained in this Agreement or confirmed in any
certificate furnished by or on behalf of Purchaser to Seller in connection with
this Agreement REGARDLESS OF FAULT;
(c) any and all Property Costs from and after the Effective Time;
(d) the Assumed Seller Obligations REGARDLESS OF FAULT;
(e) to the extent applicable to the ownership, operation or use of the Assets,
Environmental Laws, Environmental Liabilities, the release of materials into the
environment or protection of human health, safety, natural resources or the
environment, or any other environmental condition of the Assets, REGARDLESS OF
FAULT; or
(f) Any other indemnity obligations of Purchaser contained herein, including
without limitation, Section 4.4.
Section 11.5 Indemnification Proceedings.
(a) In the event that any claim or demand for which Seller or Purchaser (such
Person, an “Indemnifying Party”) may be liable to a Purchaser Indemnified Person
under Section 11.3 or to an Seller Indemnified Person under Section 11.4 (an
“Indemnified Party”) is asserted against or sought to be collected from an
Indemnified Party by a third party (a “Third Party Claim,”) the Indemnified
Party shall with reasonable promptness notify the Indemnifying Party of such
Third Party Claim by delivery of a Claim Notice, provided that the failure or
delay to so notify the Indemnifying Party shall not relieve the Indemnifying
Party of its obligations under this Article 11, except (and solely) to the
extent that the Indemnifying Party demonstrates that its defense of such Third
Party Claim is actually and materially prejudiced thereby. The Indemnifying
Party shall have thirty (30) days from receipt of the Claim Notice from the
Indemnified Party (in this Section 11.5, the “Notice Period”) to notify the
Indemnified Party whether or not the Indemnifying Party desires, at the
Indemnifying Party’s sole cost and expense, to defend the Indemnified Party
against such claim or demand; provided, that the Indemnified Party is hereby
authorized prior to and during the Notice Period, and at the cost and expense of
the Indemnifying Party, to file any motion, answer or other pleading that it
shall reasonably deem necessary to protect its interests or those of the
Indemnifying Party. The Indemnifying Party shall have the right to assume the
defense of such Third Party Claim only if and for so long as the Indemnifying
Party (i) notifies the Indemnified Party during the Notice Period that the
Indemnifying Party is assuming the defense of such Third Party Claim, (ii) uses
counsel of its own choosing that is reasonably satisfactory to the Indemnified
Party, and (iii) conducts the defense of such Third Party Claim in an active and
diligent manner. If the Indemnifying Party is entitled to, and does, assume the
defense of any such Third Party Claim, the Indemnified Party shall have the
right to employ separate counsel at its own expense and to participate in the
defense thereof. If the Indemnifying Party elects (and is entitled) to assume
the defense of such Third Party Claim, (i) no compromise or settlement thereof
or consent to any

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admission or the entry of any judgment with respect to such Third Party Claim
may be effected by the Indemnifying Party without the Indemnified Party’s
written consent (which shall not be unreasonably withheld, conditioned or
delayed) unless the sole relief provided is monetary damages that are paid in
full by the Indemnifying Party (and no injunctive or other equitable relief is
imposed upon the Indemnified Party) and there is an unconditional provision
whereby each plaintiff or claimant in such Third Party Claim releases the
Indemnified Party from all liability with respect thereto and (ii) the
Indemnified Party shall have no liability with respect to any compromise or
settlement thereof effected without its written consent (which shall not be
unreasonably withheld). If the Indemnifying Party elects not to assume the
defense of such Third Party Claim (or fails to give notice to the Indemnified
Party during the Notice Period or otherwise is not entitled to assume such
defense), the Indemnified Party shall be entitled to assume the defense of such
Third Party Claim with counsel of its own choice, at the expense and for the
account of the Indemnifying Party; provided, however, that the Indemnified Party
shall make no settlement, compromise, admission, or acknowledgment that would
give rise to liability on the part of any Indemnifying Party without the prior
written consent of such Indemnifying Party, which consent shall not be
unreasonably withheld, conditioned or delayed.
(b) Notwithstanding the foregoing, the Indemnifying Party shall not be entitled
to control (but shall be entitled to participate at its own expense in the
defense of), and the Indemnified Party, shall be entitled to have sole control
over, the defense or settlement, compromise, admission, or acknowledgment of any
Third Party Claim (i) at the reasonable expense of the Indemnifying Party, as to
which the Indemnifying Party fails to assume the defense during the Notice
Period after the Indemnified Party gives notice thereof to the Indemnifying
Party or (ii) at the reasonable expense of the Indemnifying Party, to the extent
the Third Party Claim seeks an order, injunction, or other equitable relief
against the Indemnified Party which, if successful, could materially adversely
affect the business, condition (financial or other), capitalization, assets,
liabilities, results of operations or prospects of the Indemnified Party. The
Indemnified Party shall make no settlement, compromise, admission, or
acknowledgment that would give rise to liability on the part of the Indemnifying
Party without the prior written consent of the Indemnifying Party (which consent
shall not be unreasonably withheld, conditioned or delayed).
(c) In any case in which an Indemnified Party seeks indemnification hereunder
and no Third Party Claim is involved, the Indemnified Party shall deliver a
Claim Notice to the Indemnifying Party within a reasonably prompt period of time
after an [officer] of such Indemnified Party or its Affiliates has obtained
knowledge of the Loss giving rise to indemnification hereunder. The failure or
delay to so notify the Indemnifying Party shall not relieve the Indemnifying
Party of its obligations under this Article 11 except to the extent such failure
results in insufficient time being available to permit the Indemnifying Party to
effectively mitigate the resulting Losses or otherwise prejudices the
Indemnifying Party.
(d) Notwithstanding any other provision of this Agreement to the contrary:
(i) Subject to the following sentence, Seller shall not be required to indemnify
any Person under Section 11.3(a) with respect to a breach of any representation
and warranty that

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is not a Fundamental Representation for any individual liability, loss, cost,
expense, claim, award or judgment that does not exceed $50,000.
(ii) Seller shall not be required to indemnify any Person under Section 11.3(a)
with respect to a breach of any representation and warranty that is not a
Fundamental Representation until and unless the aggregate amount of liability
for all Losses for which Claim Notices are delivered by Purchaser in accordance
with this Agreement exceeds an amount equal to three percent (3%) of the
Purchase Price (the “Indemnity Deductible”), after which point Purchaser shall
be entitled to claim Losses only to the extent such Losses are in excess of the
Indemnity Deductible.
(iii) Seller shall not be required to indemnify any Person under Section 11.3
for aggregate Losses in excess of an amount equal to twenty five percent (25%)
of the Purchase Price, except for claims made under the indemnity in Section
11.3(b) or Section 11.3(c) as it relates to the Excluded Seller Obligations.
(iv) For purposes of determining whether there has been a breach of any
representation or warranty of Seller for which Seller is required to indemnify
any Person under Section 11.3(a), any dollar or materiality qualifiers in
Seller’s representations or warranties shall be disregarded.
Section 11.6 Release.
EXCEPT FOR MATTERS FOR WHICH SELLER IS REQUIRED TO INDEMNIFY PURCHASER
INDEMNIFIED PERSONS UNDER SECTION 11.3 OR PURSUANT TO SECTION 3.4(d)(i), OR WITH
RESPECT TO POST-CLOSING REMEDIATION AGREED TO PURSUANT TO SECTION 4.3 (IF ANY)
OR EXCLUDED SELLER OBLIGATIONS, AT THE CLOSING PURCHASER HEREBY RELEASES,
REMISES AND FOREVER DISCHARGES THE SELLER INDEMNIFIED PERSONS FROM ANY AND ALL
CLAIMS, KNOWN OR UNKNOWN, WHETHER NOW EXISTING OR ARISING IN THE FUTURE,
CONTINGENT OR OTHERWISE, WHICH PURCHASER MIGHT NOW OR SUBSEQUENTLY MAY HAVE
AGAINST THE SELLER INDEMNIFIED PERSONS, RELATING DIRECTLY OR INDIRECTLY TO THE
CLAIMS ARISING OUT OF OR INCIDENT TO ENVIRONMENTAL LAWS, ENVIRONMENTAL
LIABILITIES, THE RELEASE OF MATERIALS INTO THE ENVIRONMENT OR PROTECTION OF
HUMAN HEALTH, SAFETY, NATURAL RESOURCES OR THE ENVIRONMENT, INCLUDING, WITHOUT
LIMITATION, RIGHTS TO CONTRIBUTION UNDER CERCLA, REGARDLESS OF FAULT.
Section 11.7 Disclaimers.
(a) EXCEPT AS AND TO THE EXTENT EXPRESSLY SET FORTH IN ARTICLE 5 OF THIS
AGREEMENT, OR CONFIRMED IN THE CERTIFICATE OF SELLER TO BE DELIVERED PURSUANT TO
SECTION 9.2(c), OR IN THE CONVEYANCE, (I) SELLER MAKES NO REPRESENTATIONS OR
WARRANTIES, (EXPRESS, STATUTORY OR IMPLIED) WITH RESPECT TO THE ASSETS OR THE

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TRANSACTIONS CONTEMPLATED HEREBY AND (II) SELLER EXPRESSLY DISCLAIMS ALL
LIABILITY AND RESPONSIBILITY FOR ANY REPRESENTATION, WARRANTY, STATEMENT OR
INFORMATION MADE OR COMMUNICATED (ORALLY OR IN WRITING) TO PURCHASER OR ANY OF
ITS AFFILIATES, EMPLOYEES, AGENTS, CONSULTANTS OR REPRESENTATIVES (INCLUDING,
WITHOUT LIMITATION, ANY OPINION, INFORMATION, PROJECTION OR ADVICE THAT MAY HAVE
BEEN PROVIDED TO PURCHASER BY ANY OFFICER, DIRECTOR, EMPLOYEE, AGENT,
CONSULTANT, REPRESENTATIVE OR ADVISOR OF SELLER OR ANY OF ITS AFFILIATES).
(b) EXCEPT AS EXPRESSLY REPRESENTED OTHERWISE IN ARTICLE 5 OF THIS AGREEMENT, OR
CONFIRMED IN THE CERTIFICATE OF SELLER TO BE DELIVERED PURSUANT TO SECTION
9.2(c), OR IN THE CONVEYANCE, AND WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, SELLER EXPRESSLY DISCLAIMS ANY REPRESENTATION OR WARRANTY, EXPRESS,
STATUTORY OR IMPLIED, AS TO (I) TITLE TO ANY OF THE ASSETS, (II) ANY MATTER OR
CIRCUMSTANCE RELATING TO ENVIRONMENTAL LAWS, ENVIRONMENTAL LIABILITIES, THE
RELEASE OF MATERIALS INTO THE ENVIRONMENT OR THE PROTECTION OF HUMAN HEALTH,
SAFETY, NATURAL RESOURCES OR THE ENVIRONMENT, OR ANY OTHER ENVIRONMENTAL
CONDITION OF THE ASSETS, (III) 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,
(IV) THE QUANTITY, QUALITY OR RECOVERABILITY OF PETROLEUM SUBSTANCES IN OR FROM
THE ASSETS, (V) ANY ESTIMATES OF THE VALUE OF THE ASSETS OR FUTURE REVENUES
GENERATED BY THE ASSETS, (VI) THE PRODUCTION OF HYDROCARBONS FROM THE ASSETS,
(VII) THE MAINTENANCE, REPAIR, CONDITION, QUALITY, SUITABILITY, DESIGN OR
MARKETABILITY OF THE ASSETS, (VIII) THE CONTENT, CHARACTER OR NATURE OF ANY
DESCRIPTIVE MEMORANDUM, REPORTS, BROCHURES, CHARTS OR STATEMENTS PREPARED BY
THIRD PARTIES, (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 OR ANY DISCUSSION OR
PRESENTATION RELATING THERETO, AND FURTHER DISCLAIMS ANY REPRESENTATION OR
WARRANTY, EXPRESS, STATUTORY OR IMPLIED, OF MERCHANTABILITY, FREEDOM FROM
REDHIBITORY VICES OR DEFECTS (INCLUDING THOSE CONTEMPLATED IN LOUISIANA CIVIL
CODE ARTICLES 2475, AND 2520 THROUGH 2548), 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 HERETO THAT PURCHASER SHALL BE
DEEMED TO BE OBTAINING THE ASSETS IN THEIR PRESENT STATUS, CONDITION AND STATE
OF REPAIR, “AS IS” AND “WHERE IS” WITH ALL FAULTS (EXCEPT FOR EXCLUDED

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SELLER OBLIGATIONS) AND THAT PURCHASER HAS MADE OR CAUSED TO BE MADE SUCH
INSPECTIONS AS PURCHASER DEEMS APPROPRIATE, OR (X) ANY IMPLIED OR EXPRESS
WARRANTY OF FREEDOM FROM PATENT OR TRADEMARK INFRINGEMENT.
Section 11.8 Waiver of Trade Practices Acts.
(a) It is the intention of the parties that Purchaser’s rights and remedies with
respect to this transaction and with respect to all acts or practices of Seller,
past, present or future, in connection with this transaction shall be governed
by legal principles other than the Texas Deceptive Trade Practices--Consumer
Protection Act, Tex. Bus. & Com. Code Ann. § 17.41 et seq. (the “DTPA”) or the
Louisiana unfair trade practices and consumer protection law, La. R.S. 51:1402,
et seq. (the “UTPCPL”). As such, Purchaser hereby waives the applicability of
the DTPA and the UTPCPL to this transaction and any and all duties, rights or
remedies that might be imposed by the DTPA and/or the UTPCPL, whether such
duties, rights and remedies are applied directly by the DTPA or the UTPCPL
itself or indirectly in connection with other statutes; provided, however,
Purchaser does not waive § 17.555 of the DTPA. Purchaser acknowledges,
represents and warrants that it is purchasing the goods and/or services covered
by this Agreement for commercial or business use; that it has assets of
$5,000,000.00 or more according to its most recent financial statement prepared
in accordance with GAAP; that it has knowledge and experience in financial and
business matters that enable it to evaluate the merits and risks of a
transaction such as this; and that it is not in a significantly disparate
bargaining position with Seller.
(b) Purchaser expressly recognizes that the price for which Seller has agreed to
perform its obligations under this Agreement has been predicated upon the
inapplicability of the DTPA and the UTPCPL and this waiver of the DTPA and the
UTPCPL. Purchaser further recognizes that Seller, in determining to proceed with
the entering into of this Agreement, has expressly relied on this waiver and the
inapplicability of the DTPA and the UTPCPL.
Section 11.9 INTENTIONALLY OMITTED.

Section 11.10 Recording.
As soon as practicable after Closing, Purchaser shall record the Conveyances in
the appropriate counties and/or parishes and provide Seller with copies of all
recorded or approved instruments. The Conveyances are intended to convey all of
the Properties being conveyed pursuant to this Agreement. Certain Properties or
specific portions of the Properties that are leased from, or require the
approval to transfer by, a Governmental Body are conveyed under the Conveyances
and also are described and covered by other separate assignments made by Seller
to Purchaser on officially approved forms, or forms acceptable to such entity,
in sufficient multiple originals to satisfy applicable statutory and regulatory
requirements. The interests conveyed by such separate assignments are the same,
and not in addition to, the interests conveyed in the Conveyances attached as
Exhibit B. Further, such assignments shall be deemed to contain the special
warranty of title of Seller and all of the exceptions, reservations, rights,
titles, power and privileges set forth herein and

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in the Conveyances as fully and only to the extent as though they were set forth
in each such separate assignment.
Section 11.11 Non-Compensatory Damages
None of the Purchaser Indemnified Parties nor Seller Indemnified Parties shall
be entitled to recover from Seller or Purchaser, or their respective Affiliates,
any indirect, consequential, punitive or exemplary damages or damages for lost
profits of any kind arising under or in connection with this Agreement or the
transactions contemplated hereby, except to the extent any such party suffers
such damages (including costs of defense and reasonable attorney’s fees incurred
in connection with defending of such damages) to a third party, which damages
(including costs of defense and reasonable attorney’s fees incurred in
connection with defending against such damages) shall not be excluded by this
provision as to recovery hereunder. Subject to the preceding sentence,
Purchaser, on behalf of each of the Purchaser Indemnified Parties, and Seller,
on behalf of each of Seller Indemnified Parties, waive any right to recover
punitive, special, exemplary and consequential damages, including damages for
lost profits, arising in connection with or with respect to this Agreement or
the transactions contemplated hereby.
Section 11.12 Disclaimer of Application of Anti-Indemnity Statutes
The parties acknowledge and agree that the provisions of any anti-indemnity
statute relating to oilfield services and associated activities shall not be
applicable to this Agreement and/or the transactions contemplated hereby.
ARTICLE 12
    

MISCELLANEOUS
Section 12.1 Counterparts.
This Agreement may be executed and delivered (including by facsimile
transmission) in counterparts, each of which shall be deemed an original
instrument, but all such counterparts together shall constitute but one
agreement.
Section 12.2 Notices.
All notices which are required or may be given pursuant to this Agreement shall
be sufficient in all respects if given in writing and delivered personally, by
telecopy or by registered or certified mail, postage prepaid, or sent by
electronic mail (provided any such electronic mail transmission is confirmed
either orally or by written confirmation), as follows:
If to Seller:
Mid-Con Energy Properties, LLC

Attn: Charles L. McLawhorn, III
2431 E. 61st Street, Suite 850
Tulsa, Oklahoma 74136
Telephone: (918) 743-7575

62    

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

Telecopy: (918) 743-8859
Email: cmclawhorn@midcon-energy.com

If to Purchaser:
PO&G Resources, LP

Attn: George A. Oggero, General Counsel, Chief Compliance Officer, & Land
Manager
5847 San Felipe, Suite 3200
Houston, Texas 77057
Telephone: 713-589-8138
Telecopy: 713-244-0650
Email: George_oggero@pogresources.com

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.
Section 12.3 Sales or Use Tax Recording Fees and Similar Taxes and
            Fees.
Purchaser shall bear any sales, use, excise, real property transfer, gross
receipts, goods and services, registration, capital, documentary, stamp or
transfer Taxes, recording fees and similar Taxes and fees (collectively
“Transfer Taxes”) incurred and imposed upon, or with respect to, the
transactions contemplated by this Agreement. Seller will determine, and
Purchaser will cooperate with Seller in determining the amount of any Transfer
Taxes, if any, that is due in connection with the transactions contemplated by
this Agreement and Purchaser agrees to pay any such Transfer Tax to Seller or to
the appropriate Governmental Body. If any of the transactions contemplated by
this Agreement are exempt from any such Transfer Taxes upon the filing of an
appropriate certificate or other evidence of exemption, Purchaser will timely
furnish to Seller such certificate or evidence.
Section 12.4 Exhibits and Schedules.
All of the Exhibits and Schedules referred to in this Agreement constitute a
part of this Agreement. Seller and Purchaser and their respective counsel have
received a complete set of the Exhibits and Schedules prior to and as of the
execution of this Agreement. Purchaser agrees that, with respect to the
representations and warranties of Seller contained in this Agreement, Seller
shall have the continuing right until the Closing to add, supplement or amend
the Schedules to its representations and warranties with respect to any matter
first arising hereafter that does not result in a breach by Seller of any
provision of Section 7.5 which, if existing at the date of this Agreement or
thereafter, would have been required to be set forth or described in such
Schedules. For purposes of determining whether the conditions set forth in
Section 8.2(a) have been fulfilled, the Schedules to Seller’s representations
and warranties contained in this Agreement shall be deemed to include only that
information contained therein on the date of this Agreement and shall be deemed
to exclude all information contained in any addition, supplement or amendment
thereto after the date of this Agreement; provided, however, that if the Closing
shall occur, then all Claims with respect to all matters disclosed pursuant to
any such addition, supplement or amendment at or prior to the Closing

63    

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

shall be waived and Purchaser shall not be entitled to make a claim with respect
thereto pursuant to Section 11.3(a) of this Agreement for a breach of the
representations and warranty to which such matters relate.
Section 12.5 Expenses.
Except as otherwise expressly provided in Section 12.3, or elsewhere in this
Agreement, (a) all expenses incurred by Seller in connection with or related to
the authorization, preparation or execution of this Agreement, the Conveyance
delivered hereunder and the Exhibits and Schedules hereto and thereto, and all
other matters related to the Closing, including without limitation, all fees and
expenses of counsel, accountants and financial advisers employed by Seller,
shall be borne solely and entirely by Seller, and (b) all such expenses incurred
by Purchaser shall be borne solely and entirely by Purchaser.
Section 12.6 Change of Name.
As promptly as practicable after Closing, but in any case within ninety (90)
days after the Closing Date, Purchaser shall eliminate the names “Mid-Con Energy
Properties, LLC”, “Mid-Con” and any variants thereof from the Assets acquired
pursuant to this Agreement and, except with respect to such grace period for
eliminating existing usage, shall have no right to use any logos, trademarks or
trade names belonging to Seller.
Section 12.7 Governing Law; Venue; and Waiver of Jury Trial.
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 OTHERWISE APPLICABLE TO SUCH DETERMINATIONS.
EXCEPT TO THE EXTENT PROVIDED IN SECTION 3.4(i) SECTION 4.3 OR SECTION 9.4(c),
JURISDICTION AND VENUE WITH RESPECT TO ANY DISPUTES ARISING HEREUNDER SHALL BE
PROPER ONLY IN HARRIS COUNTY, TEXAS, AND THE PARTIES HEREBY IRREVOCABLY WAIVE,
TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THEY MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY DISPUTE ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY BROUGHT IN SUCH COURTS
OR ANY DEFENSE OF INCONVENIENT FORUM FOR THE MAINTENANCE OF SUCH DISPUTE. EACH
OF THE PARTIES HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY IN
ANY PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.
Section 12.8 Captions.
The captions in this Agreement are for convenience only and shall not be
considered a part of or affect the construction or interpretation of any
provision of this Agreement.
Section 12.9 Waivers.

64    

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

Any failure by any party to comply with any of its obligations, agreements or
conditions herein contained may be waived in writing, but not in any other
manner, by the party to whom such compliance is owed. No waiver of, or consent
to a change in, any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of, or consent to a change in, other provisions hereof
(whether or not similar), nor shall such waiver constitute a continuing waiver
unless otherwise expressly provided. The rights of Seller and Purchaser under
this Agreement shall be cumulative and the exercise or partial exercise of any
such right shall not preclude the exercise of any other right.
Section 12.10 Assignment.
No party shall assign all or any part of this Agreement (other than by Purchaser
to an Affiliate of Purchaser), nor shall any party assign or delegate any of its
rights or duties hereunder (other than by Purchaser to an Affiliate of
Purchaser), without the prior written consent of the other party. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
Section 12.11 Entire Agreement.
The Confidentiality Agreement, this Agreement and the Exhibits and Schedules
attached hereto, and the documents to be executed hereunder constitute the
entire agreement between 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.
Section 12.12 Amendment.
(a) This Agreement may be amended or modified only by an agreement in writing
executed by the parties hereto.
(b) No waiver of any right under this Agreement shall be binding unless executed
in writing by the party to be bound thereby.
Section 12.13 No Third-Party Beneficiaries.
Nothing in this Agreement shall entitle any Person other than Purchaser or
Seller to any claims, remedy or right of any kind, except as to those rights
expressly provided to the Seller Indemnified Persons and Purchaser Indemnified
Persons (provided, however, any claim for indemnity hereunder on behalf of a
Seller Indemnified Person or a Purchaser Indemnified Person must be made and
administered by a party to this Agreement).
Section 12.14 References.
In this Agreement:
(a) References to any gender includes a reference to all other genders;

65    

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

(b) References to the singular includes the plural, and vice versa;
(c) Reference to any Article or Section means an Article or Section of this
Agreement;
(d) Reference to any Exhibit or Schedule means an Exhibit or Schedule to this
Agreement, all of which are incorporated into and made a part of this Agreement;
(e) Unless expressly provided to the contrary, “hereunder”, “hereof’, “herein”
and words of similar import are references to this Agreement as a whole and not
any particular Section or other provision of this Agreement;
(f) “Include” and “including” shall mean include or including without limiting
the generality of the description preceding such term; and
(g) Capitalized terms used herein shall have the meanings ascribed to them in
this Agreement as such terms are identified and/or defined in the Definitions
section hereof.
Section 12.15 Construction.
Purchaser is a party capable of making such investigation, inspection, review
and evaluation of the Assets as a prudent party would deem appropriate under the
circumstances including with respect to all matters relating to the Assets,
their value, operation and suitability. Each of Seller and Purchaser has had
substantial input into the drafting and preparation of this Agreement and has
had the opportunity to exercise business discretion in relation to the
negotiation of the details of the transactions contemplated hereby. This
Agreement is the result of arm’s-length negotiations from equal bargaining
positions. In the event of a dispute over the meaning or application of this
Agreement, it shall be construed fairly and reasonably and no consideration
shall be given to the fact or presumption that one party had a greater or lesser
hand in drafting this Agreement.
Section 12.16 Conspicuousness.
The parties agree that provisions in this Agreement in “bold” type satisfy any
requirements of the “express negligence rule” and any other requirements at law
or in equity that provisions be conspicuously marked or highlighted.
Section 12.17 Severability.
If any term or other provisions of this Agreement is held invalid, illegal or
incapable of being enforced under any rule of law, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in a materially adverse manner with respect to either
party; provided, however, that if any such term or provision may be made
enforceable by limitation thereof, then such term or provision shall be deemed
to be so limited and shall be enforceable to the maximum extent permitted by
applicable Law. Upon determining that any term or other provision is invalid,
illegal or incapable of being enforced, the parties shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties as closely as

66    

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

possible in an acceptable manner to the end that the transactions contemplated
hereby are fulfilled to the extent possible.
Section 12.18 Time of 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 date of such period during
which notice is required to be given or action taken) shall be the next day
which is a Business Day.

[SIGNATURES BEGIN ON THE FOLLOWING PAGE]

67    

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

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties hereto
on the date first above written.
SELLER:
MID-CON ENERGY PROPERTIES, LLC, 
a Delaware limited liability company

By:      Mid-Con Energy Partners, LP, a
   Delaware limited partnership, its
   Sole Member

By:      Mid-Con Energy GP, LLC, a
   Delaware limited liability company,
   Its General Partner

   By: Jeffrey R. Olmstead
      Chief Executive Officer
MID-CON ENERGY OPERATING, LLC, 
an Oklahoma limited liability company

By: Jeffrey R. Olmstead
   Chief Executive Officer

PURCHASER:
PO&G PANHANDLE, LP, 
a Texas limited partnership

By:      PO&G Panhandle Manager, LLC, a
   Texas limited liability company,
Its General Partner

By:      TJK, LLC, a
   Nevada limited liability company
   Its Sole Member

By: Steven A. Pfeifer
      Manager
 
 
 

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

EXHIBIT A
Attached to and for all purposes made a part of that certain Purchase and Sale
Agreement dated May 26, 2016, by and among MID-CON ENERGY PROPERTIES, LLC, as
Seller, and PO&G PANHANDLE, LP, as Purchaser.

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

Unit/Lease
LESSOR
LESSEE
LEASE DATE
BOOK
PAGE
ST
COUNTY
LEGAL
LEGAL DESCRIPTION
HRMU
ANADARKO LAND CORP., A NEBRASKA CORPORATION
MID-CON ENERGY CORPORATION
12/19/2005
2006
224734
CO
CHEYENNE
013S-043W-001, 013S-043W-13
W/2 SE/4 of Sec 1-13S-43W and N/2 NW/4 of Sec 13-13S-43W
HRMU
ANADARKO E & P COMPANY LP, A DELAWARE LIMITED PARTNERSHIP
MID-CON ENERGY CORPORATION
12/192005
2006
224735
CO
CHEYENNE
013S-043W-001, 013S-043W-14
SW/4; E/2 SE/4 of Sec 1-13S-43W and NE/4 & S/2 NW/4 of Sec 13-13S-43W
HRMU
LAS ANIMAS MINERALS LTD
WILBANKS & ASSOCIATES INC
1/11/1988
249
533
CO
CHEYENNE
013S-043W-012
Lots 11 – 14 (aka SW/4) of Sec 12-13S-43W
ONA
ESTATE OF ZANE RAYMOND SMALTS, A MINOR, RAYMOND SMALTS, GUARDIAN
THE ATLANTIC REFINING COMPANY
7/1/1959
84
305
OK
CIMARRON
004N-009E-025
E/2 NE/4; Limited to Morrow formation
ONA
RAYMOND AND NADINE SMALTS - HUSBAND AND WIFE
THE ATLANTIC REFINING COMPANY
9/17/1959
84
319
OK
CIMARRON
004N-009E-025
NE/4 SE/4, N/2 SE/4 SE/4; Limited to Morrow formation - 25; S/2 SE/4 SE/4;
Limited to Morrow formation
ONA
IVA ELIZA WILSON, JESSIE MAE WILSON, KALL AND REX E. WILSON
THE ATLANTIC REFINING COMPANY
4/1/1962
100
159
OK
CIMARRON
004N-009E-025
NE/4 SE/4, N/2 SE/4 SE/4; Limited to Morrow formation - 25; S/2 SE/4 SE/4;
Limited to Morrow formation
MIDWELL
CLAUDYA JO SMITH AND CYRUS L. SMITH
BURK ROYALTY CO.
9/29/1992
280
722
OK
CIMARRON
004N-009E-035
NE/4
MIDWELL
ROSALIE LANDAU & DAVID LANDAU
BURK ROYALTY CO.
12/17/1992
281
881
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
BARBARA CRISS BENNETT ALEXANDER & JOHN ALEXANDER, WH
BURK ROYALTY CO.
12/20/1992
281
792
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
RAEANN ZAHN, HEIR OF ROSE BRYANT, AND THOMAS ZAHN, WH
BURK ROYALTY CO.
12/20/1992
282
135
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
MICHAEL BATTAGLIA, HEIR OF ROSE BRYANT, AND NIELA BATTAGLIA, HW
BURK ROYALTY CO.
12/20/1992
283
48
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
JILL L. ENNIS HOPKINS AND EARL D. HOPKINS, WH
BURK ROYALTY CO.
12/20/1992
282
596
OK
CIMARRON
004N-009E-035
NE/4 SW/4

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

MIDWELL
TILFORD R. BAILEY & INEZROSE BAILEY
BURK ROYALTY CO.
12/20/1992
281
909
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
KIP DANIEL ENNIS
BURK ROYALTY CO.
12/20/1992
282
250
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
DICK AND DELMA M. WHITE, HW
BURK ROYALTY CO.
12/20/1992
281
684
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
JANE AND RONALD SHOUSE
BURK ROYALTY CO.
12/20/1992
281
883
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
RICHARD W. ENNIS AND MARY ANN ENNIS, HW
BURK ROYALTY CO.
12/20/1992
282
91
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
JERRY C. ENNIS AND ANITA A. ENNIS, HW
BURK ROYALTY CO.
12/20/1992
 
 
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
BECKY AND TONY WOODS
BURK ROYALTY CO.
12/20/1992
282
14
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
PEGGY AND JIM MUSAL
BURK ROYALTY CO.
12/20/1992
281
770
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
EMILY B. PEARCE
BURK ROYALTY CO.
12/20/1992
281
772
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
MODESTA BAILEY, A WIDOW
BURK ROYALTY CO.
12/20/1992
281
764
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
JANET S. HODGE
BURK ROYALTY CO.
12/20/1992
281
766
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
JAMES M. AND RITA ENNIS
BURK ROYALTY CO.
12/20/1992
282
12
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
JACK C. ENNIS
BURK ROYALTY CO.
12/20/1992
281
885
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
KIMBERLY A. ENNIS HARROUGH & RANDY HARROUGH
BURK ROYALTY CO.
12/20/1992
 
 
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
MADONNA AND JOSEPH BRYANT
BURK ROYALTY CO.
12/20/1992
281
790
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
CECIL G. & ANNA G. BAILEY
BURK ROYALTY CO.
12/20/1992
281
768
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
DAVID R. ENNIS & HELEN ENNIS
BURK ROYALTY CO.
12/20/1992
281
776
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
HERSHELL AND DEANN WALTZ
BURK ROYALTY CO.
12/20/1992
281
879
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
ANDREA LYNETTE WALTZ CLAYTON AND TODD CLAYTON
BURK ROYALTY CO.
12/20/1992
 
 
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
GREGORY AND TERESA WALTZ
BURK ROYALTY CO.
12/20/1992
281
877
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
RONALD FRANKLIN STILES
BURK ROYALTY CO.
12/20/1992
281
774
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
DAVID AND CAROLE BRIDGES
BURK ROYALTY CO.
12/20/1992
 
 
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
MICHAEL AND ALLISON WALTZ
BURK ROYALTY CO.
12/20/1992
282
52
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
SHEILA R. ENNIS CHITWOOD & JEFF CHITWOOD
BURK ROYALTY CO.
12/20/1992
 
 
OK
CIMARRON
004N-009E-035
NE/4 SW/4
MIDWELL
WINONA KEIFFER AND DICK KIEFFER
BURK ROYALTY CO.
12/20/1992
 
 
OK
CIMARRON
004N-009E-035
NE/4 SW/4

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

MIDWELL
THE ROXIE M. HANKE TESTAMENTARY TRUST UNDER THE WILL OF ROXIE M. HANKE, EDWARD
L. NEWLIN, TRUSTEE
BURK ROYALTY CO.
11/30/1992
281
463
OK
CIMARRON
004N-009E-035
NW/4
MIDWELL
THE PAUL HANKE TESTAMENTARY TRUST UNDER THE WILL OF PAUL HANKE EDWARD L. NEWLIN,
TRUSTEE
BURK ROYALTY CO.
11/30/1992
281
429
OK
CIMARRON
004N-009E-035
NW/4
SMALTZ
RETA NADINE SMALTS ESTATE, A MINOR, RAYMOND SMALTS, GUARDIAN
THE ATLANTIC REFINING COMPANY
7/1/1959
84
307
OK
CIMARRON
004N-009E-025
SW/4
SMALTZ
IVA ELIZA WILSON, JESSIE MAE WILSON, KALL AND REX E. WILSON
THE ATLANTIC REFINING COMPANY
4/4/1962
100
160
OK
CIMARRON
004N-009E-025
SE/4
SMALTZ
RAYMOND AND NADINE SMALTS - HUSBAND AND WIFE
THE ATLANTIC REFINING COMPANY
9/17/1959
84
319
OK
CIMARRON
004N-009E-025
SE/4
SMALTZ
ESTATE OF ZANE RAYMOND SMALTS, A MINOR, RAYMOND SMALTS, GUARDIAN
THE ATLANTIC REFINING COMPANY
7/1/1959
84
305
OK
CIMARRON
004N-009E-025
NE/4
SMALTZ
ESTATE OF JAMES CLYDE SMALTS, RAYMOND SMALTS, GUARDIAN
THE ATLANTIC REFINING COMPANY
10/1/1959
84
321
OK
CIMARRON
004N-009E-025
NW/4
EVA
WILLIAM C EGGERS ET AL
HW LONG
6/28/1954
252
398
OK
TEXAS
003N-011E-005
S/2 SE/4, NW/4 SE/4
EVA
C F WEBB AND GUYNETH V WEBB HIS WIFE
F P HAMBRIGHT
12/12/1959
312
69
OK
TEXAS
003N-011E-005
W/2
EVA
BERNICE MILES AND E E MILES HER HUSBAND
F P HAMBRIGHT
12/15/1959
312
78
OK
TEXAS
003N-011E-005
W/2
EVA
SYLVESTER N IVIE, A WIDOWER
CARTER OIL COMPANY
1/8/1955
305
487
OK
TEXAS
003N-011E-006
PORTION OF THE SE/4 SE/4 OF SEC. 6, LYING S AND E OF THE TEPEE CREEK FAULT WHICH
IS A STRAIGHT LINE BEGINNING AT A POINT 1 ,320' FSL AND 300' FEL OF SEC. 6 AND
ENDING AT A POINT ON THE SOUTH LINE OF SEC. 6 ,1 ,200' FEL
EVA
JAMES PETROLEUM CORPORATION
WILLIAM N PRICE
7/6/1961
336
290
OK
TEXAS
003N-011E-006
PORTION OF THE SE/4 SE/4 OF SEC. 6, LYING S AND E OF THE TEPEE CREEK FAULT WHICH
IS A STRAIGHT LINE BEGINNING AT A POINT 1 ,320' FSL AND 300' FEL OF SEC. 6 AND
ENDING AT A POINT ON THE SOUTH LINE OF SEC. 6, 1 ,200' FEL
EVA
F HINER DALE ADMIN. OF WILL OF ORLIA A WEEDE, DECEASED
THE CARTER OIL COMPANY
4/3/1954
301
187
OK
TEXAS
003N-011E-007
PORTION OF THE NE/4 LYING S AND E OF THE TEPEE CREEK FAULT, WHICH IS A STRAIGHT
LINE BEGINNING AT A POINT ON THEN LINE OF SEC. 7, 1200' FEL, AND ENDING AT A
POINT 2640' FEL AND 3190' FSL OF SEC. 7

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

EVA
W F DUNAWAY AND MADAL DUNAWAY HUSBAND AND WIFE
THE CARTER OIL COMPANY
9/3/1953
302
1
OK
TEXAS
003N-011E-007
PORTION OF THE NE/4 LYING S AND E OF THE TEPEE CREEK FAULT, WHICH IS A STRAIGHT
LINE BEGINNING AT A POINT ON THEN LINE OF SEC. 7, 1200' FEL, AND ENDING AT A
POINT 2640' FEL AND 3190' FSL OF SEC. 7
EVA
W F DUNAWAY
THE CARTER OIL CO
12/14/1954
305
473
OK
TEXAS
003N-011E-008
NW/4
EVA
COMMERCIAL NATIONAL BANK OF KANSAS CITY, TRUSTEE
THE CARTER OIL CO
12/14/1954
305
474
OK
TEXAS
003N-011E-008
NW/4
EVA
BERNICE V SHORES
ENSIGN OPERATING CO
8/17/1992
867
168
OK
TEXAS
003N-011E-008
NW/4 NE/4, N/2 NE/4 NE/4
EVA
LOYD V PETERSON AND NORLENE T. LOYD V PETERSON AND NORLENE T.
ENSIGN OPERATING CO
8/17/1992
867
171
OK
TEXAS
003N-011E-008
NW/4 NE/4, N/2 NE/4 NE/4
EVA
ALLEN JOE NORRIS
ENSIGN OPERATING CO
8/17/1992
867
174
OK
TEXAS
003N-011E-008
NW/4 NE/4, N/2 NE/4 NE/4
EVA
MARY LOU NORRIS KENNEY, DANIEL V. NORRIS & STEPHEN W. NORRIS
ENSIGN OPERATING CO
8/17/1992
867
489
OK
TEXAS
003N-011E-008
NW/4 NE/4, N/2 NE/4 NE/4
ONA
KENNETH BOWMAN & WILMA BOWMAN, HIS WIFE & CLIFFORD H. BOWMAN & ELSIA M. BOWMAN,
HIS WIFE
DAWSON OPERATING CO. INC.
11/22/1973
 
 
OK
TEXAS
004N-010E-017
S/2 SW/4, NW/4 SW/4 - 17; NE/4 SW/4
ONA
J.D. VOILES & T.F. VOILES, TRUSTEES OF J.D. & T.F. VOILES CHILDREN TRUST
BEARD OIL CO.
3/21/1990
 
 
OK
TEXAS
004N-010E-018
E/2 SE/4, SW/4 SE/4, S/2 NW/4 SE/4
ONA
IMOGENE METCALF
BEARD OIL CO.
3/21/1990
 
 
OK
TEXAS
004N-010E-018
E/2 SE/4, SW/4 SE/4, S/2 NW/4 SE/4
ONA
CHARLOTTE BUTLER
BEARD OIL CO.
3/22/1990
 
 
OK
TEXAS
004N-010E-018
E/2 SE/4, SW/4 SE/4, S/2 NW/4 SE/4
ONA
ADRIENNE LEBLANC
BEARD OIL CO.
3/28/1990
 
 
OK
TEXAS
004N-010E-018
E/2 SE/4, SW/4 SE/4, S/2 NW/4 SE/4
ONA
VONCIELE W. GRAY, A SINGLE WOMAN
BEARD OIL CO.
5/10/1990
 
 
OK
TEXAS
004N-010E-018
E/2 SE/4, SW/4 SE/4, S/2 NW/4 SE/4
ONA
BILLY F. BRUNS & JANET E. BURNS, HUSBAND & WIFE
HP O&G PROPERTIES INC.
8/26/1992
 
 
OK
TEXAS
004N-010E-018
S/2 NE/4 SW/4, SE/4 SW/4
ONA
ETHEL BRUMLEY, DARREL C. BRUMLEY & ELISABETH JEAN BRUMLEY
HP O&G PROPERTIES INC.
10/30/1958
 
 
OK
TEXAS
004N-010E-019
Lots 1, 2, 3, 4; E/2 W/2, E/2 (being all of Section 19)
ONA
EDWARD KAAR AND DOROTHY KAAR, HIS WIFE
RALPH H. GRAY
3/2/1973
 
 
OK
TEXAS
004N-010E-029
NW/4
ONA
C.D. LONG & MARY A. LONG, HIS WIFE
RALPH H. GRAY
3/8/1973
 
 
OK
TEXAS
004N-010E-029
NW/4
ONA
HUBERT X. ELROD & HELEN L. ELROD, HIS WIFE
RALPH H. GRAY
3/9/1973
 
 
OK
TEXAS
004N-010E-029
NW/4
ONA
JOHN MARCHBANKS AND FRANCES B. MARCHBANKS, HIS WIFE
RALPH M. REYNOLDS
4/9/1973
 
 
OK
TEXAS
004N-010E-029
NW/4
ONA
JACK K. CREATE
DAWSON OPERATING CO. INC.
4/12/1973
 
 
OK
TEXAS
004N-010E-029
NW/4

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

ONA
WALLACE R. HOUSTON
RJ SULLIVAN AND WE LEROUX DBA SULLIVAN & LEROUX
6/22/1968
 
 
OK
TEXAS
004N-010E-030
E/2 NW/4, Ltd. from surface to 103' into Mississippi Chester - 30; W/2 NW/4,
Ltd. from surface to 4750'
ONA
LEWIS W LONG, E UX
J C SOWERS, JR.
2/22/1972
438
387
OK
TEXAS
004N-010E-030
Lots 3 & 4 a/k/a W/2 SW/4 & E/2 SW/4
ONA
DARLENE S. FISKE, TRUSTEE
HP O&G PROPERTIES INC.
2/20/1992
 
 
OK
TEXAS
004N-010E-030
NE/4, Ltd. from surface to 100' below producing zone
ONA
MARTIN S. MILLER, TRUSTEE OF THOMAS S. MILLER 1975 TRUST
HP O&G PROPERTIES INC.
2/20/1992
 
 
OK
TEXAS
004N-010E-030
NE/4, Ltd. from surface to 100' below producing zone
ONA
DONALD E. SHARP
HP O&G PROPERTIES INC.
2/20/1992
 
 
OK
TEXAS
004N-010E-030
NE/4, Ltd. from surface to 100' below producing zone
ONA
CHAUNCEY HAMMOND PERSONAL REPRESENTATIVE FOR ESTATE OF HERBERT EUGENE HAMMOND,
DECEASED
BEARD OIL CO.
3/6/1992
 
 
OK
TEXAS
004N-010E-030
NE/4, Ltd. from surface to 100' below producing zone
WPWFU I
AUGUSTA HENRICHS
PANHANDLE EASTERN PIPE LINE COMPANY
8/4/1941
231
223
OK
TEXAS
002N-016E-005
SW/4 SECTION 5-2N-16ECM
WPWFU I
AUGUSTA HENRICHS
PANHANDLE EASTERN PIPE LINE COMPANY
8/19/1941
231
224
OK
TEXAS
002N-016E-005
SE/4 SECTION 5-2N-16ECM
WPWFU I
H G WITT ETUX
JOE E. DENHAM
1/2/1937
207
300
OK
TEXAS
002N-016E-007
NE/4 SECTION 7-2N-16ECM
WPWFU I
ADELLE DAVIS ETAL
THE TEXAS COMPANY
9/1/1937
211
98
OK
TEXAS
002N-016E-007
S/2 SECTION 7-2N-16ECM
WPWFU I
DAVID THOMAS
JOE E. DENHAM
12/19/1936
207
15
OK
TEXAS
002N-016E-008
E/2 SECTION 8-2N-16ECM
WPWFU I
DAVID THOMAS
JOE E. DENHAM
12/19/1936
207
5
OK
TEXAS
002N-016E-008
NW/4 SECTION 8-2N-16ECM
WPWFU I
A J GROSS ETUX
JOE E. DENHAM
1/1/1937
207
282
OK
TEXAS
002N-016E-008
SW/4 SECTION 8-2N-16ECM
WPWFU I
ATHOL COCHRAN ETUX
SKELLY OIL COMPANY
2/11/1937
207
319
OK
TEXAS
002N-016E-017
E/2 AND SW/4 SECTION 17-2N-16ECM
WPWFU I
N H READ
PHILLIPS PETROLEUM COMPANY
8/23/1943
243
158
OK
TEXAS
002N-016E-017
NW/4 SECTION 17-2N-16ECM
WPWFU I
WILLIAM F DOTTS ETUX
STANLEY MARSH, JR.
1/5/1940
217
136
OK
TEXAS
002N-016E-018
ALL SECTION 18-2N-16ECM
WPWFU II
W L & ISABEL BUSTER
JOE E. DENHAM
1/13/1937
207
149
OK
TEXAS
002N-015E-001
NW/4 SECTION 1-2N-15ECM
WPWFU II
W L & ISABEL BUSTER
JOE E. DENHAM
1/13/1937
207
149
OK
TEXAS
002N-015E-001
NE/4 SECTION 1-2N-15ECM
WPWFU II
CHRISTIAN & CLIFFIE OLSON
JOE E. DENHAM
12/21/1936
207
210
OK
TEXAS
002N-015E-001
S/2 SECTION 1-2N-15ECM
WPWFU II
HENRY & HELEN MARTIN
JOE E. DENHAM
1/13/1937
207
140
OK
TEXAS
002N-015E-012
NE/4 SECTION 12-2N-15ECM
WPWFU II
NELLIE M WATSON
PANHANDLE EASTERN PIPE LINE COMPANY
8/28/1939
217
96
OK
TEXAS
002N-016E-005
NW/4 SECTION 5-2N-16ECM
WPWFU II
ALICE STROTHER ETAL
SKELLY OIL COMPANY
3/2/1937
195
209
OK
TEXAS
002N-016E-006
ALL SECTION 6-2N-16ECM
WPWFU II
H G WITT ETUX
STANLEY MARSH, JR.
3/8/1941
210
97
OK
TEXAS
002N-016E-007
NW/4 SECTION 7-2N-16ECM
WPWFU II
JACOB REWERTS
R.G.KELLER & I.L. ENNIS
6/14/1922
114
535
OK
TEXAS
003N-015E-025
SW/4 SECTION 25-3N-15ECM
WPWFU II
JACOB REWERTS
R.G.KELLER & I.L. ENNIS
6/14/1922
114
535
OK
TEXAS
003N-015E-026
SE/4 SECTION 26-3N-15ECM
WPWFU II
GAIL F KING ETUX
H.W. LONG
10/19/1937
209
545
OK
TEXAS
003N-015E-035
SE/4 SECTION 35-3N-15ECM
WPWFU II
ALLIANCE LIFE INSURANCE
H.W. LONG
3/10/1941
210
17
OK
TEXAS
003N-015E-035
E/2 SECTION 35-3N-15ECM
WPWFU II
CLAUDE LAIRD ETAL
SKELLY OIL COMPANY
5/5/1937
206
486
OK
TEXAS
003N-015E-036
ALL SECTION 36-3N-15ECM

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

WPWFU II
R D & CARRY M HALL
STANLEY MARSH, JR.
1/7/1941
231
302
OK
TEXAS
003N-016E-031
SW/4 SECTION 31-3N-16ECM
Clawson
Clawson, Carl H.,et al
Landmark Exploration Company
12122/1986
770
371
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: NW/4 NW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
1212211986
770
338
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: SW/4SW/4
Clawson
Clawson,Carl H., et al
Landmark Exploration Company
12/2211986
770
335
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: NW/4 SW/4
Clawson
Clawson,Carl H., et al
Landmark Exploration Company
12122/1986
770
332
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: SE/4 SW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/2211986
770
329
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: NE/4 SW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12122/1986
770
326
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: SW/4 NW/4
Clawson
Mathewson, C.L., et ux
Skelly Oil Company
03/03/1937
206
173
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: W/2 NE/4, E/2 NW/4
Clawson
Cabot Carbon Company
Phillips Petroleum Company
07/1211944
255
171
OK
TEXAS
001N-016E-001
INSOFAR AND ONLY INSOFAR as said lease covers Township 1 North, Range 16 ECM
Section 1: E/2 NE/4,W/2 NW/4, SW/4
Clawson
Clawson, Kirby, et al
Samson Resources Company
05/25/2000
1012
598
OK
TEXAS
001N-016E-001
Township 1 North, Range 16 ECM Section 1: W/2 SE/4
Clawson
Clawson, Carl H.,et al
Tidemark Exploration Company
08/0211983
614
440
OK
TEXAS
001N-016E-002
Township 1 North. Range 16 ECM Section 2: E/2 SW/4
Clawson
Clawson, Carl H., et al
Tidemark Exploration Company
08/02/1983
614
392
OK
TEXAS
001N-016E-002
Township 1 North, Range 16 ECM Section 2: E/2 SE/4
Clawson
Clawson, Carl H.,et al
Landmark Exploration Company
1212211986
770
347
OK
TEXAS
001N-016E-002
Township 1 North, Range 16 ECM Section 2: SE/4 NW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12122/1986
770
344
OK
TEXAS
001N-016E-002
Township 1 North. Range 16 ECM Section 2: NE/4 NW/4
Clawson
Clawson,Carl H., et al
Landmark Exploration Company
12122/1986
770
341
OK
TEXAS
001N-016E-002
Township 1 North, Range 16 ECM Section 2: NW/4 NE/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
1212211986
770
323
OK
TEXAS
001N-016E-002
Township 1 North, Range 16 ECM Section 2: SE/4 NE/4
Clawson
Clawson, Carl H.,et al
Landmark Exploration Company
1212211986
770
320
OK
TEXAS
001N-016E-002
Township 1 North, Range 16 ECM Section 2: SW/4 NE/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
1212211986
770
317
OK
TEXAS
001N-016E-002
Township 1 North, Range 16 ECM Section 2: NE/4 NE/4
Clawson
Cabot Carbon Company
Phillips Petroleum Company
07/1211944
255
170
OK
TEXAS
001N-016E-002
INSOFAR AND ONLY INSOFAR as said lease covers Township 1 North, Range 16 ECM
Section 2: E/2 W/2, E/2
Clawson
Clawson, Kirby,et al
Samson Resources Company
05/25/2000
1012
616
OK
TEXAS
001N-016E-002
Township 1 North. Range 16 ECM Section 2: W/2 SE/4
Clawson
Clawson, Carl H., et ux
Tidemark Exploration Company
1/12/1982
610
1
OK
TEXAS
001N-016E-011
Township 1 North. Range 16 ECM Section 11: E/2 NE/4
Clawson
Clawson, Carl H., et ux
Tidemark Exploration Company
1/12/1982
610
14
OK
TEXAS
001N-016E-011
Township 1 North. Range 16 ECM Section 11: W/2 SW/4

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

Clawson
Clawson,Carl H., et ux
Tidemark Exploration Company
1/12/1982
610
53
OK
TEXAS
001N-016E-011
Township 1 North, Range 16 ECM Section 11: W/2 SE/4
Clawson
Clawson, Carl H., et ux
Tidemark Exploration Company
1/12/1982
610
66
OK
TEXAS
001N-016E-011
Township 1 North, Range 16 ECM Section 11: E/2 SE/4
Clawson
Clawson, Carl H.,et ux
Tidemark Exploration Company
1/12/1982
610
79
OK
TEXAS
001N-016E-011
Township 1 North, Range 16 ECM Section 11: E/2 NW/4
Clawson
Clawson,Carl H., et ux
Tidemark Exploration Company
1/12/1982
610
92
OK
TEXAS
001N-016E-011
Township 1 North, Range 16 ECM Section 11: W/2 NE/4
Clawson
Cabot Carbon Company
Phillips Petroleum Company
7/12/1944
255
165
OK
TEXAS
001N-016E-011
Township 1 North, Range 16 ECM Section 11: N/2, SE/4,W/2 SW/4
Clawson
Clawson, Kirby, et al
Samson Resources Company
5/25/2000
1012
589
OK
TEXAS
001N-016E-011
Township 1 North, Range 16 ECM Section 11: W/2 NW/4
Clawson
Clawson, Kirby,et al
Samson Resources Company
5/25/2000
1012
607
OK
TEXAS
001N-016E-011
Township1 North, Range 16 ECM Section 11: E/2 SW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/22/1986
770
368
OK
TEXAS
001N-016E-012
Township 1 North, Range 16 ECM Section 12: NE/4 NW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/22/1986
770
365
OK
TEXAS
001N-016E-012
Township 1 North, Range 16 ECM Section 12: SW/4 NW/4
Clawson
Clawson, Carl H.,et al
Landmark Exploration Company
12/22/1986
770
296
OK
TEXAS
001N-016E-012
Township 1 North, Range 16 ECM Section 12: NW/4 NW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/22/1986
770
293
OK
TEXAS
001N-016E-012
Township1 North, Range 16 ECM Section 12: SE/4 NW/4
Clawson
Cabot Carbon Company
Phillips Petroleum Company
7/12/1944
255
164
OK
TEXAS
001N-016E-012
Township 1 North, Range 16 ECM Section 12: NW/4
Clawson
Miller, Charles A., et ux, et al
Panhandle Eastern Pipe Line Company
1/27/1943
240
36
OK
TEXAS
002N-016E-025
Township 2 North, Range 16 ECM Section 25: SW/4,W/2 SE/4
Clawson
Miller, Charles R., et ux
THE TEXAS COMPANY
9/13/1937
211
124
OK
TEXAS
002N-016E-026
INSOFAR AND ONLY INSOFAR as said lease covers Township North. Range 16 ECM  
Section 26: E/2 SE/4
Clawson
Clawson,Carl H., et al
Landmark Exploration Company
12/22/1986
770
362
OK
TEXAS
002N-016E-035
Township 2 North. Range 16 ECM   Section 35: NE/4 SE/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/22/1986
770
359
OK
TEXAS
002N-016E-035
Township 2 North. Range 16 ECM   Section 35: NW/4 SE/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/22/1986
770
356
OK
TEXAS
002N-016E-035
Township 2 North.Range 16 ECM   Section 35: SE/4 SW/4
Clawson
Clawson, Carl H., et al
Landmark Exploration Company
12/22/1986
770
308
OK
TEXAS
002N-016E-035
Township 2 North. Range 16 ECM   Section 35: NE/4 SW/4
Clawson
Clawson, Carl H., et a
Landmark Exploration Company
12/22/1986
770
305
OK
TEXAS
002N-016E-035
Township 2 North. Range 16 ECM   Section 35: SW/4 SE/4
Clawson
Clawson, CarlH., et al
Landmark Exploration Company
12/22/1986
770
302
OK
TEXAS
002N-016E-035
Township 2 North, Range 16 ECM    Section 35: SE/4 SE/4
Clawson
Cabot Carbon Company
PETROLEUM COMPANY
7/12/1944
255
173
OK
TEXAS
002N-016E-035
INSOFAR AND ONLY INSOFAR as said lease covers Township North. Range 16 ECM  
Section 35: E/2 SW/4, SE/4
Clawson
Prudential Insurance Company of America
FRANK PARKES
9/9/1941
231
263
OK
TEXAS
002N-016E-035
INSOFAR AND ONLY INSOFAR as said lease covers Township North. Range 16 ECM  
Section 35: E/2 NW/4, NE/4

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

Clawson
Miller C. A., et ux
Panhandle Eastern Pipe Line Company
1/27/1943
240
19
OK
TEXAS
002N-016E-036
Township 2 North. Range 16 ECM   Section 36: W/2
Clawson
Miller C. A., et ux, et al
Panhandle Eastern Pipe Line Company
8/19/1941
231
218
OK
TEXAS
002N-016E-036
Township 2 North. Range 16 ECM   Section 36: E/2
Bivins
OLIVER W BIVINS ET AL
BAKER & TAYLOR DRILLING CO
4/9/1982
1433
285
TX
POTTER
 
ALL LANDS INCLUDED WITHIN THE BIVINS RANCH PENN UNIT, 40-ACRE PRORATION UNITS,
BEING IN SECTIONS 2 AND 3, BLOCK 4, ACH&B SURVEY AND N /4 SECTION 209, BLOCK 2,
AB&M SURVEY, FROM THE SURFACE TO THE STRATIGRAPHIC EQUIVALENT OF 5,849 FEET
WHICH IS 100 FEET BELOW THE BASE OF THE PENN SAND AS IDENTIFIED ON THE
HALLIBURTON SPECTRAL DENSITY DUAL SPACED NEUTRON II LOG RUN ON JANUARY 19, 2002
IN THE BIVINS RANCH #15-3 WELL LOCATED IN THE NW/4 OF SECTION 3, BLOCK 4, ACH&B
SURVEY, POTTER COUNTY TX
Bivins
MARY E BIVINS TRUST
BAKER & TAYLOR DRILLING CO
4/9/1982
1433
279
TX
POTTER
 
ALL LANDS INCLUDED WITHIN THE BIVINS RANCH PENN UNIT, 40-ACRE PRORATION UNITS,
BEING IN SECTIONS 2 AND 3, BLOCK 4, ACH&B SURVEY AND N/4 SECTION 209, BLOCK 2,
AB&M SURVEY, FROM THE SURFACE TO THE STRATIGRAPHIC EQUIVALENT OF 5,849 FEET
WHICH IS 100 FEET BELOW THE BASE OF THE PENN SAND AS IDENTIFIED ON THE
HALLIBURTON SPECTRAL DENSITY DUAL SPACED NEUTRON II LOG RUN ON JANUARY 19, 2002
IN THE BIVINS RANCH #15-3 WELL LOCATED IN THE NW/4 OF SECTION 3, BLOCK 4, ACH&B
SURVEY, POTTER COUNTY TEXAS
Bivins
STATE OF TEXAS, THROUGH AGENT LX CATTLE COMPANY
QUESTAR EXPLORATION AND PRODUCTION COMPANY
10/21/2000
3013
330
TX
POTTER
 
SECTION 1, BLOCK B, LEE BIVINS SURVEY, A-1540, POTTER COUNTY TX
Bivins
OLIVER W BIVINS ET AL
JOE E WATKINS
7/18/1995
2512
677
TX
POTTER
 
12 PARCELS OF LAND CONTAINING 40 ACRES AROUND EACH SHALLOW GAS WELL LOCATED IN
SECTION 2 ACH&B SVY BLK 4 A-1355 AND IN SECTION 3 ACH&B BLK 4 A-81, SLIMITED
FROM THE SURFACE TO 50' BELOW THE LOWEST PRODUCING ZONE, POTTER COUNTY TX
Bivins
OLIVER BIVINS ET AL TRUST
SAND RIVER O&E LLC
12/11/2003
3573
711
TX
POTTER
 
SECTION 3, ACH&B SVY BLK 4, 40 ACRES DESCRIBED AS 40 ACRE PRORATION UNIT
COVERING THE BIVINS RANCH 3005 SURFACE TO 50' BELOW BOTTOM OF LOWEST PRODUCING
ZONE IN THE BIVINS RANCH 3005, POTTER COUNTY TEXAS

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

Bivins
J M HUBER CORPORATION
SAND RIVER O&E LLC
12/11/2003
3573
728
TX
POTTER
 
SECTION 3, ACH&B SVY BLK 4, 40 ACRES DESCRIBED AS 40 ACRE PRORATION UNIT
COVERING THE BIVINS RANCH 3005 SURFACE TO 50' BELOW BOTTOM OF LOWEST PRODUCING
ZONE IN THE BIVINS RANCH 3005, POTTER COUNTY TEXAS

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

EXHIBIT A-1
Attached to and for all purposes made a part of that certain Purchase and Sale
Agreement dated May 26, 2016, by and among MID-CON ENERGY PROPERTIES, LLC, as
Seller, and PO&G PANHANDLE, LP, as Purchaser.

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

UNIT/LEASE
WELL NAME
ALTERNATE WELL NAME
LOCATION
API/ALT WELL NAME
ST
COUNTY
HRMU
HRMU 1 INJ
 
NE NW 12-13S-43W
05-017-07046
CO
CHEYENNE
HRMU
HRMU 11 INJ
 
NW NW 13-13S-43W
05-017-07793
CO
CHEYENNE
HRMU
HRMU 2 INJ
 
SW NE 12-13S-43W
05-017-07078
CO
CHEYENNE
HRMU
HRMU 4 INJ
 
NW SE 12-13S-43W
05-017-07112
CO
CHEYENNE
HRMU
HRMU 14-1
 
SW SW 1-13S-43W
05-017-07148
CO
CHEYENNE
HRMU
HRMU 3
 
SW NW 12-13S-43W
05-017-07111
CO
CHEYENNE
HRMU
HRMU 5
 
SW SE 1-13S-43W
05-017-07157
CO
CHEYENNE
HRMU
HRMU 6
 
SW SW 12-13S-43W
05-017-07145
CO
CHEYENNE
HRMU
HRMU 7
 
NE SW 12-13S-43W
05-017-07080
CO
CHEYENNE
HRMU
HRMU 8 WSW
 
NE NW 13-13S-43W
05-017-07166
CO
CHEYENNE
HRMU
HRMU 9
 
Lot 14 12-13S043W
05-017-07709
CO
CHEYENNE
OMU
OMU 2512
 
CSE4 NE4 of 25-T4N-R9E
3502520885
OK
CIMARRON
Midwell
MIDWELL 2
 
SE4 SE4 of 26-T4N-R9E
3502520007
OK
CIMARRON
Midwell
MIDWELL 103
 
SW4 SE4 of 26-T4N-R9E
3502520072
OK
CIMARRON
Midwell
MIDWELL 206
 
S2 N2 SW4 SW4 of 25-T4N-R9E
3502520390
OK
CIMARRON
Midwell
MIDWELL 7-35
 
NW4 NW4 NE4 NE4 of 35-T4N-R9E
3502521017
OK
CIMARRON
Midwell
MIDWELL 8-35
 
NW NW SW NE of 35-T4N-R9E
3502521018
OK
CIMARRON
Midwell
MIDWELL 9-35
 
SE NE SW NW of 35-T5N-R9E
3502521058
OK
CIMARRON
Midwell
SMALTZ 1 WSW
 
C E2 E2 SE4 of 26-T4N-R9E
 
OK
CIMARRON
SMALTZ
SMALTS UNIT 7
 
CSE4 SW4 of 25-T4N-R9E
3502520460
OK
CIMARRON
SMALTZ
SMALTS UNIT 8-25
 
SW4 SW4 NE4 SW4 of 25-T4N-R9E
3502521060
OK
CIMARRON
EVA
ESU 8
 
CSW4 NE4 of 7-T3N-R11E
3513900289
OK
TEXAS
EVA
ESU 3
 
SW4 SW4 SW4 of 5-T3N-R11E
3513922240
OK
TEXAS
EVA
ESU #4 WSW
 
SE4 SE4 SE4 of 6-T3N-R11E
3513922481
OK
TEXAS
EVA
ESU 9
 
CNW4 SE4 SE4 of 5-T3N-R11E
3513922556
OK
TEXAS
EVA
ESU 10
 
SE4 SE4 NW4 NE4 of 7-T3N-R11E
3513922583
OK
TEXAS
EVA
ESU 11
 
S2 N2 SE4 NE4 of 7-T3N-R11E
3513922664
OK
TEXAS
EVA
ESU 12
 
SE4 NE4 NW4 NW4 of 8-T3N-R11E
3513922724
OK
TEXAS
EVA
ESU 13-H
 
SE4 SW4 SE4 SE4 of 6-T3N-R11E
3513923072
OK
TEXAS
EVA
ESU 14
 
W2 NE4 NE4 NW4 of 8-T3N-R11E
3513924036
OK
TEXAS
EVA
ESU 15
 
N2 SW4 NW4 NW4 of 8-T3N-R11E
3513924150
OK
TEXAS
EVA
ESU 17
 
C SW SW SE of 5-T3N-R11E
3513924549
OK
TEXAS
EVA
ESU 16
 
S2 NE SE SW of 5-T3N-R11E
3513924550
OK
TEXAS
EVA
ESU 4
 
CSE4 SE4 of 6-T3N-R11E
3513935647
OK
TEXAS
EVA
ESU 6
 
CN2 NW4 of 8-T3N-R11E
3513936000
OK
TEXAS
EVA
ESU #1 WSW
 
N2 SW NW of 8-T3N-R11E
3513921753
OK
TEXAS
EVA
ESU #2 WSW
 
C SE NW of 7-T3N-R11E
3513935649
OK
TEXAS
OMU
OMU 1
BRUMLEY 1
NW4 of 19-T4N-R10E
3513900217
OK
TEXAS
OMU
OMU 3-19
BRUMLEY 3-19
CSW4 NE4 of 19-T4N-R10E
3513920537
OK
TEXAS

EXHIBIT B

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

OMU
OMU 3031
 
NE4 SW4 NW4 of 30-T4N-R10E
3513920538
OK
TEXAS
OMU
OMU 3011X
 
NW4 NE4 of 30-T4N-R10E
3513920541
OK
TEXAS
OMU
OMU 3042X
 
CN2 NW4 SW4 of 30-T4N-R10E
3513920543
OK
TEXAS
OMU
OMU 1914X
 
CSE4 SE4 of 19-T4N-R10E
3513920562
OK
TEXAS
OMU
OMU 2015
 
CSW4 SW4 of 20-T4N-R10E
3513920578
OK
TEXAS
OMU
OMU 3012X
 
NE4 NE4 of 30-T4N-R10E
3513920594
OK
TEXAS
OMU
OMU 2012
 
CNW4 SW4 of 20-T4N-R10E
3513920609
OK
TEXAS
OMU
OMU 1915
 
SW4 SE4 of 19-T4N-R10E
3513920626
OK
TEXAS
OMU
OMU 1821X
 
SE4 SE4 of 18-T4N-R10E
3513920631
OK
TEXAS
OMU
OMU 2013
 
SW4 SE4 NW4 of 20-T4N-R10E
3513920636
OK
TEXAS
OMU
OMU 1711
 
NW4 SW4 SW4 of 17-T4N-R10E
3513920712
OK
TEXAS
OMU
OMU 6-19
 
S2 N2 NE4 SE4 of 19-T4N-R10E
3513920713
OK
TEXAS
OMU
OMU 3041
 
CN2 NE4 SW4 of 30-T4N-R10E
3513920728
OK
TEXAS
OMU
OMU 2911X
 
NW4 SW4 NW4 of 29-T4N-R10E
3513922196
OK
TEXAS
OMU
OMU 2016
 
C N2 NW of 20-T4N-R10E
3513922587
OK
TEXAS
OMU
OMU 2017
 
C NW SW NW of 20-T4N-R10E
3513924592
OK
TEXAS
OMU
OMU 2912Y
 
W2 NW4 NW4 NW4 of 29-T4N-R10E
3513922597
OK
TEXAS
OMU
OMU 3032
 
NE SW NW NW of 30-T4N-R10E
3513923112
OK
TEXAS
OMU
OMU 1917
 
CNE4 SE4 NW4 of 19-T4N-R10E
3513923150
OK
TEXAS
OMU
OMU 1918
 
SE4 SE4 NE4 SE4 of 19-T4N-R10E
3513924192
OK
TEXAS
OMU
OMU 3043
 
SE4 SE4 SW4 NW4 of 30-T4N-R10E
3513924193
OK
TEXAS
OMU
OMU 3044
 
E2 W2 NE NW of 30-T4N-R10E
3513924566
OK
TEXAS
OMU
OMU 1919
 
W2 SE NE NE of 19-T4N-R10E
3513924567
OK
TEXAS
OMU
OMU 1920
 
SE SE SE NE of 19-T4N-R10E
35139245910001
OK
TEXAS
OMU
OMU 1
 
NE SE NW SE of 19-T4N-R10E
3513924600
OK
TEXAS
OMU
OMU 2-19
 
NE4 NE4 NW4 of 19-T4N-R10E
3513935646
OK
TEXAS
WPWFU I
WPWF 5#1
HIGGINS 5-1
SW/4 of 5-T2N-R16E
3513922882
OK
TEXAS
WPWFU I
WPWF 5#2
HIGGINS 5-2
SW/4 of 5-T2N-R16E
3513923290
OK
TEXAS
WPWFU I
WPWF HIGGINS 5-3
HIGGINS 5-3
SW/4 of 5-T2N-R16E
3513924534
OK
TEXAS
WPWFU I
WPWF 5#3
AUBREY 5-1
SE/4 of 5-T2N-R16E
3513923327
OK
TEXAS
WPWFU I
WPWF 5#4
AUBREY 5-2
SE/4 of 5-T2N-R16E
3513923361
OK
TEXAS
WPWFU I
WPWF 7#2
PETUNIA PIG 7-2
NE/4 of 7-T2N-R16E
3513923269
OK
TEXAS
WPWFU I
WPWF 7#5
DAVIS HITCH 7-5
NE/4 of 7-T2N-R16E
3513923055
OK
TEXAS
WPWFU I
WPWF 7#1
PETUNIA PIG 7-1
SE/4 of 7-T2N-R16E
3513923264
OK
TEXAS
WPWFU I
WPWF 7#3
PETUNIA PIG 7-3
SE/4 of 7-T2N-R16E
3513923270
OK
TEXAS
WPWFU I
WPWF 7#4
DAVIS HITCH 7-4
SE/4 of 7-T2N-R16E
3513922877
OK
TEXAS
WPWFU I
WPWF 8#11
PORKY PIG 8-11
NE/4 of 8-T2N-R16E
3513923231
OK
TEXAS
WPWFU I
WPWF 8#13
PORKY PIG 8-13
NE/4 of 8-T2N-R16E
3513923306
OK
TEXAS
WPWFU I
WPWF 8#15
PORKY PIG 8-15
NE/4 of 8-T2N-R16E
3513923331
OK
TEXAS
WPWFU I
WPWF 8#12
PORKY PIG 8-12
NW/4 of 8-T2N-R16E
3513923271
OK
TEXAS
WPWFU I
WPWF 8#17
PORKY PIG 8-17
NW/4 of 8-T2N-R16E
3513923983
OK
TEXAS
WPWFU I
WPWF 8#8
PORKY PIG 8-8
NW/4 of 8-T2N-R16E
3513923228
OK
TEXAS
WPWFU I
WPWF 8#9
PORKY PIG 8-9
NW/4 of 8-T2N-R16E
3513923229
OK
TEXAS
WPWFU I
WPWF 8#2
PORKY PIG 8-2
SW/4 of 8-T2N-R16E
3213923132
OK
TEXAS
WPWFU I
WPWF 8#3
PORKY PIG 8-3
SW/4 of 8-T2N-R16E
3513923182
OK
TEXAS
WPWFU I
WPWF 8#6
PORKY PIG 8-6
SW/4 of 8-T2N-R16E
3513923226
OK
TEXAS
WPWFU I
WPWF 8#7
PORKY PIG 8-7
SW/4 of 8-T2N-R16E
3513923227
OK
TEXAS
WPWFU I
WPWF 8#10
PORKY PIG 8-10
SE/4 of 8-T2N-R16E
3513923230
OK
TEXAS
WPWFU I
WPWF 8#16
PORKY PIG 8-16
SE/4 of 8-T2N-R16E
3513923368
OK
TEXAS
WPWFU I
WPWF 8#4
PORKY PIG 8-4
SE/4 of 8-T2N-R16E
3513923183
OK
TEXAS
WPWFU I
WPWF 8#5
PORKY PIG 8-5
SE/4 of 8-T2N-R16E
3513923184
OK
TEXAS
WPWFU I
WPWF 17#3
HITCH ENTERPRISES 17-3
NE/4 of 17-T2N-R16E
3513923185
OK
TEXAS

    

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

WPWFU I
WPWF 17#6
HITCH ENTERPRISES 17-6
NE/4 of 17-T2N-R16E
3513923259
OK
TEXAS
WPWFU I
WPWF 17#7
HITCH ENTERPRISES 17-7
NE/4 of 17-T2N-R16E
3513923277
OK
TEXAS
WPWFU I
WPWF 17#4
HITCH ENTERPRISES 17-4
NW/4 of 17-T2N-R16E
3513923195
OK
TEXAS
WPWFU I
WPWF 17#5
HITCH ENTERPRISES 17-5
NW/4 of 17-T2N-R16E
3513923233
OK
TEXAS
WPWFU I
WPWF 18#1
HITCH ENTERPRISES 18-1
NE/4 of 18-T2N-R16E
3513923292
OK
TEXAS
WPWFU II
WP2 1 #1
BUSTER, W.L. 1#1
NE NE of 1-T2N-R15E
3513923054
OK
TEXAS
WPWFU II
WP2 1 #3
MINA 1#3
NW NW of 1-T2N-R15E
3513923972
OK
TEXAS
WPWFU II
WP2 MINA 1-4
 
SE NE of 1-T2N-R15E
3513924535
OK
TEXAS
WPWFU II
MINA 1-4
MINA 1#4
SW NE of 1-T2N-R15E
3513924553
OK
TEXAS
WPWFU II
MINA 1-5
MINA 1#5
NE SE of 1-T2N-R15E
3513924613
OK
TEXAS
WPWFU II
WP2 12 #1
MARTIN 12#1
NE NE of 12-T2N-R15E
3513923131
OK
TEXAS
WPWFU II
WP2 5 #1
KAUFFMAN 5#1
SW NW of 5-T2N-R16E
3513922929
OK
TEXAS
WPWFU II
WP2 5 #2
KAUFFMAN 5#2
SW NW of 5-T2N-R16E
3513923500
OK
TEXAS
WPWFU II
WP2 6 #1
MISS PIGGIE 6#1
SE NW of 6-T2N-R16E
3513923266
OK
TEXAS
WPWFU II
WP2 6 #2H
TRUESDELL 6#2H
SW SW of 6-T2N-R16E
3513922730
OK
TEXAS
WPWFU II
WP2 6 #3
TRUESDELL 6#3
SW NW of 6-T2N-R16E
3513922800
OK
TEXAS
WPWFU II
WP2 6 #4
TRUESDELL 6#4
NE SW of 6-T2N-R16E
3513922851
OK
TEXAS
WPWFU II
WP2 6 #5
TRUESDELL 6#5
SW SE of 6-T2N-R16E
3513922866
OK
TEXAS
WPWFU II
WP2 6 #6
TRUESDELL 6#6
NE NW of 6-T2N-R16E
3513922848
OK
TEXAS
WPWFU II
WP2 6 #7
TRUESDELL 6#7
SW NE of 6-T2N-R16E
3513922875
OK
TEXAS
WPWFU II
WP2 6 #8
TRUESDELL 6#8
NE SE of 6-T2N-R16E
3513922876
OK
TEXAS
WPWFU II
WP2 7 #2
DAVIS-HITCH 7#2
SE NW of 7-T2N-R16E
3513922350
OK
TEXAS
WPWFU II
WP2 7 #3
DAVIS-HITCH 7#3
NW NW of 7-T2N-R16E
3513922787
OK
TEXAS
WPWFU II
WP2 35 #6
SCHLUCKENIER 35#6
NE SE of 35-T3N-R15E
3513922811
OK
TEXAS
WPWFU II
WP2 35 #7
SCHLUCKENIER 35#7
NE NE of 35-T3N-R15E
3513922831
OK
TEXAS
WPWFU II
WP2 35 #8
SCHLUCKENIER 35#8
SE SE of 35-T3N-R15E
3513923930
OK
TEXAS
WPWFU II
WP2 36 #1
ARA 36#1
SW SE of 36-T3N-R15E
3513922795
OK
TEXAS
WPWFU II
WP2 36 #2 (ARA)
ARA 36#2
NE SE of 36-T3N-R15E
3513922821
OK
TEXAS
WPWFU II
WP2 36 #2 (LAIRD)
LAIRD 36#2
NE NW of 36-T3N-R15E
3513922792
OK
TEXAS
WPWFU II
WP2 36 #3 (ARA)
ARA 36#3
SW NE of 36-T3N-R15E
3513922822
OK
TEXAS
WPWFU II
WP2 36 #3 (LAIRD)
LAIRD 36#3
NE SW of 36-T3N-R15E
3513922793
OK
TEXAS
WPWFU II
WP2 36 #4
LAIRD 36#4
SW NW of 36-T3N-R15E
3513922796
OK
TEXAS
WPWFU II
WP2 36 #5
LAIRD 36#5
SW SW of 36-T3N-R15E
3513922819
OK
TEXAS
WPWFU II
WP2 36 #6
LAIRD 36#6
NW SW of 36-T3N-R15E
3513923310
OK
TEXAS
WPWFU II
WP2 36 #7
LAIRD 36#7
NW NW of 36-T3N-R15E
3513923569
OK
TEXAS
WPWFU II
WP2 31 #1
AIRWAVES 31#1
SW SW of 31-T3N-R16E
3513922834
OK
TEXAS
WPWFU II
WP2 36 #8
LAIRD 36#8
C NW of 35-T3N-R15E
3513924536
OK
TEXAS
WPWFU II
WP2 36 #9
LAIRD 36#9
SE SW of 36-T3N-R15E
3513924541
OK
TEXAS
Clawson
STEPHENS #7-25
 
W/2 SW/4 of 25-T02N-R16ECM
3513922920
OK
TEXAS
Clawson
STEPHENS #8-25
 
SW/4 NE/4 SW/4 of 25-T02N-R16ECM
35-139-22962
OK
TEXAS
Clawson
STEPHENS #6-25
 
C SW/4 SE/4 of 25-T02N-R16ECM
35-139-22756
OK
TEXAS
Clawson
MILLER Q #4
 
W/2 NW/4 of 36-T02N-R16ECM
35-139-22727
OK
TEXAS
Clawson
MILLER Q #6
 
NW/4 SE/4 NW/4 NW/4 of 36-T02N-R16ECM
35-139-24372
OK
TEXAS
Clawson
MILLER Q #2
 
E/2 NW/4 of 36-T02N-R16ECM
35-139-22725
OK
TEXAS
Clawson
MILLER Q #5
 
NW/4 SE/4 SE/4 NW/4 of 36-T02N-R16ECM
35-139-24367
OK
TEXAS
Clawson
STEPHENS #4-36
 
W/2 NE/4 of 36-T02N-R16ECM
35-139-22751
OK
TEXAS

    

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

Clawson
STEPHENS #5-36
 
NE/4 NE/4 of 36-T2N-R16ECM
35-139-24611
OK
TEXAS
Clawson
CLAWSON TRUST #3-35
 
E/2 SW/4 of 35-T02N-R16ECM
35-139-22233
OK
TEXAS
Clawson
CLAWSON TRUST #1-35
 
W/2 SE/4 of 35-T02N-R16ECM
35-139-22209
OK
TEXAS
Clawson
CLAWSON TRUST #2-35
 
E/2 SE/4 of 35-T02N-R16ECM
35-139-22258
OK
TEXAS
Clawson
MILLER TRUST #1-36
 
W/2 SW/4 of 36-T02N-R16ECM
35-139-22295
OK
TEXAS
Clawson
MILLER TRUST #2-36
 
SW/4 SE/4 NW/4 SW/4 of 36-T02N-R16ECM
35-139-24378
OK
TEXAS
Clawson
MILLER TRUST #3-36
 
SE NW SE SW of 36-T2N-R16ECM
35-139-24564
OK
TEXAS
Clawson
STEPHENS #1-36
 
E/2 SW/4 of 36-T02N-R16ECM
35-139-22661
OK
TEXAS
Clawson
STEPHENS #2-36
 
W/2 SE/4 of 36-T02N-R16ECM
35-139-22673
OK
TEXAS
Clawson
STEPHENS #3-36
 
C NE/4 SE/4 of 36-T02N-R16ECM
35-139-22746
OK
TEXAS
Clawson
BERNICE #7-2
 
NE SE SE NE of 2-T1N-R16ECM
35-139-24604
OK
TEXAS
Clawson
BERNICE #6-2
 
E/2 NW/4 of 2-T01N-R16ECM
35-139-22235
OK
TEXAS
Clawson
BERNICE #4-2
 
W/2 NE/4 of 2-T01N-R16ECM
35-139-22162
OK
TEXAS
Clawson
BERNICE #5-2
 
C NE/4 NE/4 of 2-T01N-R16ECM
35-139-22208
OK
TEXAS
Clawson
CARL #2-1
 
SE/4 NE/4 SW/4 NW/4 of 1-T01N-R16ECM
35-139-24275
OK
TEXAS
Clawson
KIRBY #1-1
 
E/2 NW/4 of 1-T01N-R16ECM
35-139-22662
OK
TEXAS
Clawson
KIRBY #2-1
 
C SW/4 NE/4 of 1-T01N-R16ECM
35-139-22683
OK
TEXAS
Clawson
KIRBY #3-1
 
E/2 NE/4 of 1-T01N-R16ECM
35-139-22740
OK
TEXAS
Clawson
KIRBY #4-1
 
C NW NW of 1-T1N-R16ECM
35-139-24562
OK
TEXAS
Clawson
BERNICE #2-2
 
E/2 SW/4 of 2-T01N-R16ECM
35-139-21943
OK
TEXAS
Clawson
BERNICE #1-2
 
W/2 SE/4 of 2-T01N-R16ECM
35-139-21829
OK
TEXAS
Clawson
BERNICE #3-2
 
W/2 NE/4 SE/4 of 2-T01N-R16ECM
35-139-27946
OK
TEXAS
Clawson
LANDON #1
 
W/2 SW/4 of 1-T01N-R16ECM
35-139-22163
OK
TEXAS
Clawson
LANDON #2-1
 
E/2 SW/4 of 1-T01N-R16ECM
35-139-22217
OK
TEXAS
Clawson
CLAWSON #4-11
 
W/2 NE/4 of 11-T01N-R16ECM
35-139-21690
OK
TEXAS
Clawson
CLAWSON #5-11
 
E/2 NE/4 of 11-T01N-R16ECM
35-139-21745
OK
TEXAS
Clawson
LANDON #4
 
NW/4 NW/4 NW/4 of 12-T01N-R16ECM
35-139-22232
OK
TEXAS
Clawson
LANDON #3
 
E/2 NW/4 of 12-T01N-R16ECM
35-139-22231
OK
TEXAS
Clawson
PRUDENTIAL #2
 
E/2 NE/4 of 35-T02N-R16ECM
35-139-22892
OK
TEXAS
Clawson
CLAWSON #8-11
 
W/2 NW/4 of 11-T01N-R16ECM
35-139-21902
OK
TEXAS
Clawson
CLAWSON #6-11
 
E/2 NW/4 of 11-T01N-R16ECM
35-139-21818
OK
TEXAS
Clawson
CLAWSON #2-11
 
W/2 SW/4 of 11-T01N-R16ECM
35-139-21641
OK
TEXAS
Clawson
CLAWSON #1-11
 
E/2 SW/4 of 11-T01N-R16ECM
35-139-20283-A
OK
TEXAS
Clawson
CLAWSON #3-11
 
W/2 SE/4 of 11-T01N-R16ECM
35-139-21653
OK
TEXAS
Clawson
CLAWSON #7-11
 
E/2 SE/4 of 11-T01N-R16ECM
35-139-21881
OK
TEXAS
Bivins
BIVINS RANCH 202
 
2800’ FSL & 1055’ FEL SEC 2
42 375 31407
TX
POTTER
Bivins
BIVINS RANCH 302
 
2800’ FSL & 2255’ FEL SEC 2
42 375 31421
TX
POTTER
Bivins
BIVINS RANCH 602
 
2876’ FEL & 1416’ FNL SEC 2
42 375 31459
TX
POTTER
Bivins
BIVINS RANCH 702
 
1416’ FNL & 4126’ FEL SEC 2
42 375 31465
TX
POTTER
Bivins
BIVINS RANCH 902
 
1625’ FWL & 2748’ FSL SEC 2
42 375 31462
TX
POTTER
Bivins
BIVINS RANCH 1102
 
1500’ FEL & 2375’ FSL SEC 2
42 375 31747
TX
POTTER
Bivins
BIVINS RANCH 1202
 
NE/4 NE/4 SW/4 FEL SEC 2
42 375 31745
TX
POTTER
Bivins
BIVINS RANCH 1302
 
2800’ FSL & 2255’ FWL SEC 2
42 375 31794
TX
POTTER
Bivins
BIVINS RANCH 1502
 
1840’ FWL & 1749’ FNL SEC 2
42 375 31808
TX
POTTER
Bivins
BIVINS RANCH 103
 
1760’ FSL & 745’ FWL SEC 3
42 375 31378
TX
POTTER
Bivins
BIVINS RANCH 303
 
SW/4 SW/4 NW/4 OF SEC 3
42 375 31393
TX
POTTER
Bivins
BIVINS RANCH 503
 
SW/4 SE/4 NW/4 SEC 3
42 375 31461
TX
POTTER
Bivins
BIVINS RANCH 803
 
2800’ FSL & 2850’ FWL SEC 3
42 375 31463
TX
POTTER
Bivins
BIVINS RANCH 1103
 
1230’ FNL & 2500’ FWL SEC 3
42 375 31538
TX
POTTER
Bivins
BIVINS RANCH 1303
 
1230’ FNL & 2500’ FWL SEC 3
42 375 31614
TX
POTTER
Bivins
BIVINS RANCH 1703
 
SEC 3, BLK 4, ACH&B SVY
42 375 31793
TX
POTTER

    

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

Bivins
BIVINS RANCH 1603
 
4687’ FEL & 3830’ FNL SEC 3
42 375 31746
TX
POTTER
Bivins
BIVINS RANCH 2203
 
SEC 3, BLK 4, ACH&B SVY
42 375 31807
TX
POTTER
Bivins
BIVINS RANCH 1003
 
1800’ FSL & 1756’ FEL SEC 3
42 375 31467
TX
POTTER
Bivins
BIVINS RANCH 502
 
1416’ FNL & 476’ FEL SEC 2
42 375 31460
TX
POTTER
Bivins
BIVINS RANCH 403
 
1615’ FSL & 2163’ FWL SEC 3
42 375 31458
TX
POTTER
Bivins
BIVINS RANCH 1503
 
1700’ FNL & 800’ FWL SEC 3
42 375 31641
TX
POTTER
Bivins
BIVINS RANCH 2001
 
900’ FWL & 1010’ FNL SEC 2
42 375 31433
TX
POTTER
Bivins
BIVINS RANCH 102 (WOLFCAMP)
 
1320’ FSL & 2025’ FWL SEC 2
42 375 31374
TX
POTTER
Bivins
BIVINS RANCH 1029 (WOLFCAMP)
 
SEC 29, BLK GM-05, G&M SVY
42 375 31348
TX
POTTER
Bivins
BIVINS RANCH 203 (RED CAVE)
 
1328’ FSL & 967’ FEL SEC 2
42 375 31366
TX
POTTER
Bivins
BIVINS RANCH 3002 (WOLFCAMP)
 
1640’ FWL & 950’ FSL SEC 3
42 375 31472
TX
POTTER
Bivins
BIVINS RANCH 3003 (WOLFCAMP)
 
NW/4 SW/4 SE/4 SEC 3
42 375 31473
TX
POTTER
Bivins
BIVINS RANCH C 3001 (RED CAVE)
 
SW/4 NW/4 SEC 3
42 375 31471
TX
POTTER
Bivins
BIVINS RANCH B 2003 (RED CAVE)
 
SW/4 NE/4 SEC 3
42 375 31474
TX
POTTER
Bivins
BIVINS RANCH 3004 (RED CAVE)
 
Sec 3, Blk 4, ACH&B Svy
42 375 31599
TX
POTTER
Bivins
BIVINS RANCH 3005 (RED CAVE)
 
Sec 3, Blk 4, ACH&B Svy
42 375 31615
TX
POTTER

It is the intent for this instrument to include all of Seller’s right, title and
interest in and to the above described leases, whether such interests are
properly described herein or no, including, but not limited to the following:

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST IN AND TO THE HARKER RANCH
MORROW SAND UNIT ESTABLISHED UNDER THE OIL AND GAS CONSERVATION COMMISSION OF
THE STATE OF COLORADO, ORDER #477-4, CAUSE #477, COVERING THE SOUTH HALF OF
SECTION 1, TOWNSHIP 13, RANGE 43 WEST; ALL OF SECTION 12, TOWNSHIP 13 SOUTH,
RANGE 43 WEST; AND THE NORTH HALF OF SECTION 13, TOWNSHIP 13 SOUTH, RANGE 43
WEST IN CHEYENNE COUNTY, COLORADO.

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST, IN THE MIDWELL WATERFLOOD
UNIT, COVERING THE SW/4 SW/4 OF SECTION 25, E/2 OF SECTION 26, NE/4 SW/4 AND N/2
OF SECTION 35, ALL IN TOWNSHIP 4 NORTH, RANGE 9 EAST, CIMARRON COUNTY, OKLAHOMA
AS UNITIZED UNDER ORDER NO. 375069, CD CAUSE NO. 93016774, CONTAINING 720 ACRES,
MORE OR LESS

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST, IN THE ONA NORTHWEST MORROW
SAND UNIT, COVERING THE W/2 SW/4 AND SE/4 SW/4 OF SECTION 17; THE E/2 SE/4 AND
SW/4 SE/4 AND S/2 NW/4 SE/4 AND S/2 NE/4 SW/4 AND SE/4 SW/4 OF SECTION 18; ALL
OF SECTION 19; THE W/2 OF SECTION 20; THE SW/4 OF SECTION 29; THE N/2 AND N/2
S/2 AND N/2 S/2 SW/4 OF SECTION 30, ALL IN TOWNSHIP 4 NORTH, RANGE 10 EAST,
TEXAS COUNTY, OKLAHOM AND THE E/2 NE/4 AND NE/4 SE/4 AND

    

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

N/2 SE/4 SE/4 OF SECTION 25, TOWNSHIP 4 NORTH, RANGE 9 EAST, CIMARRON COUNTY,
OKLAHOMA AS UNITIZED UNDER ORDER NO. 371665 (CD CAUSE NO. 930166378), CONTAINING
2061.54 ACRES, MORE OR LESS

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST IN THE EVA SOUTH MORROW SAND
UNIT, COVERING ALL OF SE/4 SE/4 OF SECTION 6 LYING SOUTH AND EAST OF THE TEPEE
CREEK FAULT WHICH IS A STRAIGHT LINE BEGINNING AT A POINT 1320 FEET FROM THE
SOUTH LINE AND 300 FEET FROM THE EAST LINE OF SECTION 6 AND ENDING AT A POINT ON
THE SOUTH LINE OF SECTION 6, 1200 FEET FROM THE EAST LINE; AND ALL OF NE/4 OF
SECTION 7 LYING SOUTH AND EAST OF THE TEPEE CREEK FAULT WHICH IS A STRAIGHT LINE
BEGINNING AT A POINT ON THE NORTH LINE OF SECTION 7, 1200 FEET FROM THE EAST
LINE, AND ENDING AT A POINT 2640 FEET FROM THE EAST LINE AND 3190 FEET FROM THE
SOUTH LINE OF SECTION 7; AND S/2 SW/4 OF SECTION 5; AND NW/4 OF SECTION 8; AND
S/2 SE/4 OF SECTION 5; AND NW/4 NE/4 AND N/2 NE/4 NE/4 OF SECTION 8, ALL IN
TOWNSHIP 3 NORTH, RANGE 11 ECM, TEXAS COUNTY, OKLAHOMA, AS UNITIZED UNDER ORDER
NO 376157 (CAUSE CD NO. 930166378)

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST, IN THE WAR PARTY WATERFLOOD
UNIT I, COVERING THE S/2 OF SECTION 5, E/2 OF SECTION 7, ALL OF SECTION 8, N/2
OF SECTION 17 AND NE/4 OF SECTION 18, TOWNSHIP 2 NORTH, RANGE 16 ECM, TEXAS
COUNTY, OKLAHOMA, AS UNITIZED UNDER ORDER 457185 (CAUSE CD NO. 200104363)

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST, IN THE WAR PARTY WATERFLOOD
UNIT II, COVERING THE E/2 AND N/2 NW/4 OF SECTION 1 AND THE NE/4 OF SECTION 12,
TOWNSHIP 2 NORTH, RANGE 15 EAST CM, THE NW/4 OF SECTION 5, ALL OF SECTION 6 AND
THE NW/4 OF SECTION 7, TOWNSHIP 2 NORTH, RANGE 16 EAST CM, THE SW/4 OF SECTION
25, SE/4 OF SECTION 26, E/2 OF SECTION 35 AND ALL OF SECTION 36, TOWNSHIP 3
NORTH, RANGE 15 EAST CM, AND THE SW/4 OF SECTION 31, TOWNSHIP 3 NORTH, RANGE 16
EAST CM, TEXAS COUNTY, OKLAHOMA, AS UNITIZED UNDER ORDER 470777 (CAUSE CD NO.
200205514)

THIS EXHIBIT INCLUDES ALL RIGHT, TITLE AND INTEREST, IN THE CLAWSON RANCH
WATERFLOOD UNIT, COVERING PARTS OF SECTIONS 25, 26, 35, ALL OF SECTION 36,
TOWNSHIP 2 NORTH, RANGE 16 ECM AND PARTS OF SECTIONS 1,2,12, ALL OF SECTION 11,
TOWNSHIP 1 NORTH, RANGE 16 ECM, TEXAS COUNTY, OKLAHOMA, AS UNITIZED UNDER ORDER
444359 (CAUSE CD NO. 990002444-T)

    

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

EXHIBIT A-2
Attached to and for all purposes made a part of that certain Purchase and Sale
Agreement dated May 26, 2016, by and among MID-CON ENERGY PROPERTIES, LLC, as
Seller, and PO&G PANHANDLE, LP, as Purchaser.

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

WELL NAME
WORKING INTEREST
NET REVENUE INTEREST
HARKER RANCH MORROW UNIT
100.00
%
82.780876
%
MIDWELL WATERFLOOD UNIT
100.00
%
80.00
%
ONA NORTHWEST MORROW UNIT
100.00
%
81.31909
%
SMALTS LEASE
100.00
%
80.00
%
EVA SOUTH MORROW SAND UNIT
100.00
%
84.523118% WI
0.885217% ORRI

WAR PARTY WATERFLOOD UNIT I
100.00
%
87.1923% WI
0.11215% ORRI

WAR PARTY WATERFLOOD UNIT II
99.00
%
86.198014% WI
0.109354% ORRI

CLAWSON RANCH WATERFLOOD UNIT
100.00
%
83.45325
%
BIVINS RANCH PENN UNIT
84.582225
%
59.580163% WI
0.115334% ORRI

BIVINS RANCH GAS WELLS
85.00
%
63.75
%

    

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

EXHIBIT B
Attached to and for all purposes made a part of that certain Purchase and Sale
Agreement dated May 26, 2016, by and among MID-CON ENERGY PROPERTIES, LLC, and
MID-CON ENERGY OPERATING, LLC, as Seller, and PO&G PANHANDLE, LP, as Purchaser.

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

PRIOR TO CLOSING, THE PARTIES AGREE TO NEGOTIATE A MUTUALLY AGREEABLE ASSIGNMENT
FORM

    

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

EXHIBIT C
Attached to and for all purposes made a part of that certain Purchase and Sale
Agreement dated May 26, 2016, by and among MID-CON ENERGY PROPERTIES, LLC, and
MID-CON ENERGY OPERATING, LLC, as Seller, and PO&G PANHANDLE, LP, as Purchaser.

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

[Indemnity Agreement to follow]

EXHIBIT C

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

INDEMNITY AGREEMENT
This Indemnity Agreement is executed on _____________, 2016 (the “Effective
Date”), by and among MID-CON ENERGY PROPERTIES, LLC, a          limited
liability company (“Indemnifying Party”), and [________________], a
___________________ (“Indemnified Party”).
WHEREAS, Indemnifying Party, as seller, and Indemnified Party, as purchaser,
entered into that certain Purchase and Sale Agreement, dated ________________,
2016 (the “PSA”); and
WHEREAS, pursuant to Section 3.4(d)(ii) of the PSA, Indemnifying Party desires
to indemnify and hold Indemnified Party harmless with respect to certain losses
associated with certain Title Defects (as defined in the PSA), as more fully set
forth in this Agreement.
NOW, THEREFORE, in consideration of the premises, covenants and agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1.    Indemnification by Indemnifying Party. Indemnifying Party hereby
indemnifies and holds harmless the Indemnified Party from and against loss of
property value, as well as reasonable outside counsel attorney fees and other
actual and reasonable third-party costs and expenses of investigation and
litigation (“Losses”) arising out of or attributable to Third Party Claims (as
defined below) relating to the Title Defects identified on Exhibit A attached
hereto and incorporated herein by reference (individually, a “Subject Title
Defect”, collectively, the “Subject Title Defects”), up to the amount attributed
to each Subject Title Defect, which amount is also identified on Exhibit A (with
respect to each Subject Title Defect, the “Individual Defect Amount”, with
respect to the aggregate amount for all Subject Title Defects identified on
Exhibit A, the “Aggregate Defect Amount”).
2.    Limits on Indemnification, Dispute regarding Losses.
(a)    Notwithstanding anything in the PSA or this Agreement to the contrary,
the Indemnified Party and the Indemnifying Party hereby agree and acknowledge
that the Indemnified Party’s sole and exclusive remedy with relation to Losses
suffered by the Indemnified Party relating to all Subject Title Defects shall be
limited to the Aggregate Defect Amount and with relation to Losses suffered by
the Indemnified Party regarding any individual Subject Title Defect shall be
limited to the corresponding Individual Defect Amount. Additionally,
notwithstanding anything in the PSA or this Agreement to the contrary, the
Indemnified Party’s sole and exclusive remedy with respect to any and all
claims, liabilities, suits, controversies, losses, costs and expenses relating
to the Subject Title Defects shall be limited to a claim for reimbursement of
Losses pursuant to this Agreement. Each of the parties to this Agreement
expressly waives and agrees not to seek, and to cause its affiliates not to
seek, indirect, consequential, punitive or exemplary damages or damages for lost
profits of any kind with respect to any dispute arising under, related to, or in
connection with this Agreement or the Subject Title Defects.

INDEMNITY AGREEMENT        PAGE 1

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

(b)    For purposes of calculating the amount of any Losses payable by the
Indemnifying Party, the amount of such Losses shall be determined as agreed upon
by the Indemnifying Party and the Indemnified Party with reference to the
applicable Individual Defect Amount in accordance with the terms of, and subject
to the limitations contained in, this Agreement and with regard to the portion
of the Individual Defect Amount that is affected by a Third Party Claim. In the
event the parties to this Agreement are unable to agree upon the amount of any
Losses, the dispute shall be exclusively and finally resolved pursuant to this
Section 2(b). There shall be a single arbitrator, who shall be a title attorney
with at least ten (10) years experience in oil and gas titles involving
properties in the regional area in which the properties constituting the Subject
Title Defect are located, as selected by mutual agreement of the parties hereto
(the “Title Expert”). The Title Expert’s determination shall be made within
twenty (20) days after submission of the matters in dispute and shall be final
and binding upon all parties to this Agreement, without right of appeal. In
making his determination, the Title Expert shall be bound by the rules and
limitations set forth in this Agreement and may consider such other matters as
in the opinion of the Title Expert are necessary or helpful to make a proper
determination. The Title Expert may allow the parties to make written
submissions of their positions in the manner and to the extent the Title Expert
deems appropriate, and the Title Expert may call on the parties to submit such
other materials as the Title Expert deems helpful and appropriate to resolution
of the dispute. Additionally, the Title Expert may consult with and engage
disinterested third parties to advise the Title Expert, including without
limitation petroleum engineers. The parties hereto shall each bear its own legal
fees and other costs of presenting its case. Each party shall bear one-half of
the costs and expenses of the Title Expert, including any costs incurred by the
Title Expert that are attributable to such third party consultation. Within ten
(10) days after the Title Expert delivers written notice to the parties to this
Agreement of his award with respect to the disputed Losses, the Indemnifying
Party shall pay to the Indemnified Party the amount, if any, so awarded by the
Title Expert to the Indemnified Party.
(c)    Claims by the Indemnified Party for reimbursement for Losses pursuant to
this Agreement shall be limited to claims made within the Claim Period (as
defined below). To the extent the Indemnified Party fails to notify the
Indemnifying Party of any claims for reimbursement for Losses within the Claim
Period, the Indemnified Party shall be deemed to have waived any right to
reimbursement for any Losses or any other damages the Indemnified Party may have
suffered or incurred with respect to any such Subject Title Defect.
3.    Indemnification Proceedings.
(a)    At any time prior to the date which is two (2) years following the
Effective Date (the “Claim Period”), the Indemnified Party will have the right
to notify the Indemnifying Party in writing that the Indemnified Party is making
an indemnification claim for reimbursement for any Losses incurred or reasonably
anticipated to be incurred with respect to any third party claim regarding title
to or ownership of an interest in a property which is identified as a Subject
Title Defect. In the event that any third party makes a claim regarding title to
or ownership of an interest in a property which is identified as a Subject Title
Defect for which the Indemnifying Party may be liable to the Indemnified Party
pursuant to Section 1 above (a “Third Party Claim”), the Indemnified Party shall
with reasonable promptness notify the Indemnifying Party of such Third Party
Claim by delivery of a written notice to the Indemnifying Party (a “Claim
Notice”), provided

INDEMNITY AGREEMENT        PAGE 2

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

that the failure or delay to so notify the Indemnifying Party shall not relieve
the Indemnifying Party of their obligations under this Agreement, except to the
extent that the Indemnifying Party demonstrates that its defense of such Third
Party Claim is materially prejudiced thereby. The Indemnifying Party shall have
thirty (30) days from receipt of the Claim Notice from the Indemnified Party
(the “Notice Period”) to notify the Indemnified Party whether or not the
Indemnifying Party desires, at the Indemnifying Party’s sole cost and expense,
to defend the Indemnified Party against such claim or demand; provided, that the
Indemnified Party is hereby authorized prior to and during the Notice Period,
and at the cost and expense of the Indemnifying Party, to file any motion,
answer or other pleading that it shall reasonably deem necessary to protect its
interests or those of the Indemnifying Party. The Indemnifying Party shall have
the right to assume the defense of such Third Party Claim only if and for so
long as the Indemnifying Party (i) notifies the Indemnified Party during the
Notice Period that the Indemnifying Party is assuming the defense of such Third
Party Claim, (ii) uses counsel of its own choosing that is reasonably
satisfactory to the Indemnified Party, and (iii) conducts the defense of such
Third Party Claim in an active and diligent manner. If the Indemnifying Party is
entitled to, and does, assume the defense of any such Third Party Claim, the
Indemnified Party shall have the right to employ separate counsel at its own
expense and to participate in the defense thereof. If the Indemnifying Party
elects (and are entitled) to assume the defense of such Third Party Claim,
(i) no compromise or settlement thereof or consent to any admission or the entry
of any judgment with respect to such Third Party Claim may be effected by the
Indemnifying Party without the Indemnified Party’s written consent (which shall
not be unreasonably withheld, conditioned or delayed) unless the sole relief
provided is monetary damages that are paid in full by the Indemnifying Party
(and no injunctive or other equitable relief is imposed upon the Indemnified
Party) and there is an unconditional provision whereby each plaintiff or
claimant in such Third Party Claim releases the Indemnified Party from all
liability with respect thereto and (ii) the Indemnified Party shall have no
liability with respect to any compromise or settlement thereof effected without
its written consent (which shall not be unreasonably withheld). If the
Indemnifying Party elects not to assume the defense of such Third Party Claim
(or fails to give notice to the Indemnified Party during the Notice Period), the
Indemnified Party shall be entitled to assume the defense of such Third Party
Claim with counsel of its own choice, at the expense and for the account of the
Indemnifying Party; provided, however, that the Indemnified Party shall make no
settlement, compromise, admission, or acknowledgment that would give rise to
liability on the part of the Indemnifying Party without the prior written
consent of such Indemnifying Party, which consent shall not be unreasonably
withheld, conditioned or delayed.
(b)    Notwithstanding the foregoing, the Indemnifying Party shall not be
entitled to control (but shall be entitled to participate at its own expense in
the defense of), and the Indemnified Party shall be entitled to have sole
control over, the defense or settlement, compromise, admission, or
acknowledgment of any Third Party Claim (i) at the reasonable expense of the
Indemnifying Party, as to which the Indemnifying Party fails to assume the
defense during the Notice Period after the Indemnified Party gives notice
thereof to the Indemnifying Party or (ii) at the reasonable expense of the
Indemnifying Party, to the extent the Third Party Claim seeks an order,
injunction, or other equitable relief against the Indemnified Party which, if
successful, could materially adversely affect the business, condition (financial
or other), capitalization, assets, liabilities, results of operations or
prospects of the Indemnified Party. The Indemnified Party shall make no
settlement, compromise, admission, or acknowledgment that would give rise to
liability on the part of the Indemnifying Party

INDEMNITY AGREEMENT        PAGE 3

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

without the prior written consent of the Indemnifying Party (which consent shall
not be unreasonably withheld, conditioned or delayed).
4.    Tax Treatment of Indemnification Payments. All indemnification payments
pursuant to this Agreement shall be treated as adjustments to the Purchase Price
(as defined in the PSA).
5.    Counterparts.  This Agreement may be executed and delivered (including by
facsimile transmission) in counterparts, each of which shall be deemed an
original instrument, but all such counterparts together shall constitute but one
agreement.
6.    Notice. All notices which are required or may be given pursuant to this
Agreement shall be sufficient in all respects if given in writing and delivered
personally, by telecopy or by registered or certified mail, postage prepaid, or
sent by electronic mail (provided any such electronic mail transmission is
confirmed either orally or by written confirmation), as follows:
If to Indemnifying Party:

If to Indemnified Party:
 
Mid-Con Energy Properties, LLC
Attn: Charles L. McLawhorn, III
2431 E. 61st Street, Suite 850
Tulsa, Oklahoma 74136
Telephone: (918) 743-7575
Telecopy: (918) 743-8859
Email: cmclawhorn@midcon-energy.com

PO&G Panhandle, LP
Attn: George A. Oggero, General Counsel, Chief Compliance Officer, & Land
Manager
5847 San Felipe, Suite 3200
Houston, Texas 77057
Telephone: 713-589-8138
Telecopy: 713-244-0650
Email: George_oggero@pogresources.com

INDEMNITY AGREEMENT        PAGE 4

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

Any 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.
7.    Governing Law and Venue. 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 OTHERWISE
APPLICABLE TO SUCH DETERMINATIONS. JURISDICTION AND VENUE WITH RESPECT TO ANY
DISPUTES ARISING HEREUNDER SHALL BE PROPER ONLY IN TARRANT COUNTY, TEXAS.
8.    Captions. The captions in this Agreement are for convenience only and
shall not be considered a part of or affect the construction or interpretation
of any provision of this Agreement.
9.    Waivers. Any failure by any party or parties to comply with any of its or
their obligations, agreements or conditions herein contained may be waived in
writing, but not in any other manner, by the party or parties to whom such
compliance is owed. No waiver of, or consent to a change in, any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of, or
consent to a change in, other provisions hereof (whether or not similar), nor
shall such waiver constitute a continuing waiver unless otherwise expressly
provided.
10.    Assignment. No party to this Agreement shall assign all or any part of
this Agreement, nor shall any party assign or delegate any of its rights or
duties hereunder, without the prior written consent of the other parties.
Notwithstanding the preceding, however, either of the Indemnifying Party may,
without the Indemnified Party’s consent, assign its rights and duties hereunder
to a successor to all or substantially all of the Indemnifying Party’s business
or assets. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
11.    Amendment.
This Agreement may be amended or modified only by an agreement in writing
executed by the parties hereto.
No waiver of any right under this Agreement shall be binding unless executed in
writing by the party to be bound thereby.
12.    No Third-Party Beneficiaries. Nothing in this Agreement shall entitle any
Person (as defined in the PSA) other than the parties to this Agreement to any
benefit, claims, remedy or right of any kind.
13.    Construction. Each of the parties to this Agreement has had substantial
input into the drafting and preparation of this Agreement and has had the
opportunity to exercise business discretion in relation to the negotiation of
the details of the transactions contemplated hereby. This Agreement is the
result of arm’s-length negotiations from equal bargaining positions. In the
event

INDEMNITY AGREEMENT        PAGE 5

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

of a dispute over the meaning or application of this Agreement, it shall be
construed fairly and reasonably and neither more strongly for nor against any
party.
14.    Severability. If any term or other provisions of this Agreement is held
invalid, illegal or incapable of being enforced under any rule of law, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in a materially adverse manner with respect
to any party; provided, however, that if any such term or provision may be made
enforceable by limitation thereof, then such term or provision shall be deemed
to be so limited and shall be enforceable to the maximum extent permitted by
applicable Law (as defined in the PSA).
[SIGNATURE PAGE FOLLOWS.]

INDEMNITY AGREEMENT        PAGE 6

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

IN WITNESS WHEREOF, this Agreement has been signed by each of the parties hereto
on the date first above written.
INDEMNIFYING PARTY:
MID-CON ENERGY PROPERTIES, LLC, 
a Delaware limited liability company

By:      Mid-Con Energy Partners, LP, a
   Delaware limited partnership, its
   Sole Member

By:      Mid-Con Energy GP, LLC, a
   Delaware limited liability company,
   Its General Partner

   By:________________________                    Jeffrey R. Olmstead
      Chief Executive Officer
MID-CON ENERGY OPERATING, LLC, 
an Oklahoma limited liability company

By: ________________________
   Jeffrey R. Olmstead
   Chief Executive Officer

INDEMNIFIED PARTY:
PO&G PANHANDLE, LP, 
a Texas limited partnership

By:      PO&G Panhandle Manager, LLC, a
   Texas limited liability company,
Its General Partner

By:      TJK, LLC, a
   Nevada limited liability company
   Its Sole Member

   By:________________________                    Steven A. Pfeifer
      Manager
 
 
 

INDEMNITY AGREEMENT        PAGE 7

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

SCHEDULE 1.2(d)
CONTRACTS
•
Gas Marketing Agreement with DCP Midstream, LP (Contract No. CRG022450A) dated
September 1, 2014

•
Gas Marketing Agreement with DCP Midstream, LP (Contract No. CRG0229500) dated
July 1, 2009

•
Gas Marketing Agreement with DCP Midstream, LP (Contract No. BOR1413503) dated
August 31, 2012

•
Gas Marketing Agreement with DCP Midstream, LP (Contract No. NHC029200)
terminated February 1, 2016

•
Crude Marketing Agreement with Plains Marketing, LP (Contract No. 8220-1004)
dated May 1, 2016

•
Crude Marketing Agreement with Plains Marketing, LP (Contract No. 8220-1003)
dated May 1, 2016

•
Crude Marketing Agreement with CHS McPherson Refinery, Inc. (Contract No.
213692) dated May 1, 2016

•
Crude Marketing Agreement with Valero and Marketing Supply Company (Contract No.
11-0030) dated June 1, 2013

•
Crude Marketing Agreement with Valero and Marketing Supply Company (Contract No.
12-0015) dated March 1, 2012

•
Unit Agreement for Bivins Rach Penn Unit dated October 15, 2001

•
Unit Operating Agreement for Bivins Ranch Penn Unit dated October 15, 2001

•
Line Well Agreement dated February 1, 2014.

•
Unit Agreement for Harker Ranch Morrow Sand Unit dated October 17, 2005

•
Unit Operating Agreement for Harker Ranch Morrow Sand Unit dated October 17,
2005

•
Plan of Unitization for Clawson Ranch Waterflood Unit dated July 1, 1999

•
Plan of Unitization for Eva South Morrow Sand Unit dated November 2, 1992

•
Plan of Unitization for Midwell Waterflood Unit dated March 10, 1993

•
Plan of Unitization for Ona Northwest Morrow Sand Unit dated September 23, 1992

•
Plan of Unitization for War Party Waterflood Unit dated August 23, 2001

•
Plan of Unitization for War Party II Waterflood Unit dated November 5, 2002

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

SCHEDULE 1.2(e)
EASEMENTS/SURFACE AGREEMENTS
•
Surface Damage Agreement with LX Cattle Company and Mid-Con Energy Operating,
LLC.

•
Surface Damage Agreement with LX Cattle Company and Mid-Con Energy Operating,
LLC.

•
Surface Damage Agreement with LX Cattle Company and Mid-Con Energy Operating,
LLC.

•
Surface Agreement with Stephens Land & Cattle dated January 24, 2001.

•
Agreement for Surface Damages with Carl & Bernice Clawson dated May 5, 2000.

•
Surface Damage Agreement between Kirby B. Clawson and Mid-Con Energy Operating,
Inc. dated February 15, 2013.

•
Surface Damage Agreement between Carl & Bernice Clawson Trust and Mid-Con Energy
Operating, LLC.

•
Surface Agreement with Mid-Con Energy Operating, LLC and Stephens Land & Cattle
dated May 22, 2014.

•
Surface Agreement with Mid-Con Energy Operating, LLC and Stephens Land & Cattle
dated January 1, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Douglas &
Kay Horton Inter Vivos Trust dated October 30, 2012.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Webb Red
Living Trust dated December 21, 2012.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Donna
Campbell dated March 6, 2012.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Donna
Campbell dated April 29, 2014.

•
Surface Damage Agreement between RDT Properties and Donna Campbell and Campbell
Family Trust dated May 20, 2006.

•
Surface Agreement and Right of Way Easement between Robert H. Campbell and Bass
Enterprises Production Company dated March 23, 1990.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Harker Family
Registered, LLLP dated June 23, 2014.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Barry J. &
Carolyn L. Gerstner dated June 3, 2014.

•
Addendum to Surface Damage Agreement between Mid-Con Energy Operating, LLC and
Hanke Properties, LLC dated July 19, 2014.

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

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Ada Phillips,
LLC dated January 31, 2014.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Ada Phillips,
LLC dated September 4, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Triple S.
Land Company dated September 9, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and JB & Carol
J. Stewart dated March 22, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and N&R Dry
Acres, LLC.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and James B. &
Kim R. Alleman dated June 5, 2012.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Steven C.
Robin K. Laird dated April 26, 2012.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Steven C.
Robin K. Laird dated April 26, 2012.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Neva Joyce
Keesecker Revocable Trust dated September 20, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating, Inc. and Loren J. &
Anita C. Witt, Kathleen Fyffe and Eugene & Bonita Harke.

•
Surface Damage Agreement between & Mid-Con Energy Operating, Inc. and Ada
Phillips, LLC dated November 12, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating Inc. and Triple S Land
Company dated March 22, 2013.

•
Surface Damage Agreement between Mid-Con Energy Operating, LLC and Barry J. and
Carolyn L. Gerstner dated November 15, 2014.

•
Surface Damage Agreement between RDT Properties, Inc. and Donna M. Campbell
dated July 26, 2011.

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

SCHEDULE 1.2(k)
VEHICLES AND VESSELS
None.

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

SCHEDULE 1.3(e)
EXCLUDED ASSETS
VEHICLES
 
 
 
 
 
 
Unit No.
Year
Make
Model
VIN
OK-Tag
14584
2012
Ford
F-150
1FTFW1EFXCFB14584
696JGE
80418
2013
Ford
F-150
1FTFX1EFXDKD80418
820JPW
15197
2012
Ford
F-250
1FT7X2B6XCEA15197
I39706
2454
2011
Ford
F-250
1FT7X2B66BED02454
I39649
7228
2012
Ford
F-250
1FT7X2B69CED07228
490JPW
56397
2012
Ford
F-250
1FT7X2B63CEA56397
327JGG
23240
2013
Ford
F-250
1FT7X2B68DEB23240
928JPX
53447
2014
Ford
F-150
1FTFW1EF0EKF53447
838KSS
2609
2016
Toyota
Tacoma
5TFSZ5AN7GX002609
Z33695

EQUIPMENT
 
 
 
 
 
 
 
 
 
 
 
FIELD
Equipment Type
MAKE
SIZE
SERIAL NUMBER
MOTOR HP
Midwell
Pumping Unit
Unknown
C-114-143-74
20060701
20
Midwell
Pumping Unit
Lufkin
C114D
 
20
Midwell
Pumping Unit
American
80-119-54
T11F54-11-1322
 

CONTRACTS
 
 
 
 
 
 
 
 
 
 
 
•
    Water Supply Well Agreement dated January 2016; between Mid-Con Energy
Properties, LLC and
Mid-Con Energy III, LLC

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

SCHEDULE 3.3(l)
PERMITTED ENCUMBRANCES
None.

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

SCHEDULE 3.4(a)
ALLOCATED VALUES ($)
Unit
Allocation
Bivins Ranch
2,199,000
Clawson Ranch Waterflood
1,064,000
Eva South Morrow Unit
0
Harker Ranch Morrow Unit
2,525,000
Midwell Unit
1,882,000
Ona Morrow Unit
7,060,000
Smaltz Unit
270,000
War Party Unit I
0
War Party Unit II
3,000,000
Total
18,000,000

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

SCHEDULE 5.7
LITIGATION

None.

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

SCHEDULE 5.8
TAXES AND ASSESSMENTS
None.

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

SCHEDULE 5.9
COMPLIANCE WITH LAWS
None.

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

SCHEDULE 5.10
OUTSTANDING CAPITAL COMMITMENTS
•
May 15, 2016 AFE for Harker Ranch #9 well -- $61,890

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

SCHEDULE 5.11
IMBALANCES
None.

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

SCHEDULE 5.13
TRANSFER REQUIREMENTS
•
War Party II Waterflood Unit Plan of Unitization

•
Bivins Ranch leases

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

SCHEDULE 5.16
OIL & GAS OPERATIONS
None.

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

SCHEDULE 5.17
PLUGGING & ABANDONMENT
None.

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

SCHEDULE 5.21
SUSPENSE ACCOUNTS
$3,969.67.

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

SCHEDULE 5.22
INSURANCE; BONDING
INSURANCE:
•
2015-07-01 Commercial Umbrella - Chubb #7988-64-97 - MCEO, Inc.

•
2015-07-01 Commercial Umbrella - Chubb #7988-64-97 - amendment to MCEO LLC

•
2015-07-01 Commercial Umbrella 2nd layer - AIG #047721714 - MCEO Inc.

•
2015-07-01 Commercial Umbrella 2nd layer - AIG #047721714 - amendment to MCEO
LLC

•
2015-07-01 General Liability - Chubb #3600-37-89 - MCEO, Inc.

•
2015-07-01 General Liability - Chubb #3600-37-89 - amendment to MCEO, LLC

•
2015-07-01 General Liability - Chubb #3600-37-89 - WFB to additional insured

•
2015-07-01 General Liability Certificate of Insurance - Chubb #3600-37-89 -
MCEO, LLC w WF

•
2015-10-02 General Liability - Chubb #3600-37-89 - 30-day cancellation notice to
Harwood

•
2015-07-01 Pollution Liability - Chubb #3733-43-65 - MCEO, Inc.

•
2015-07-01 Pollution Liability - Chubb #3733-43-65 - amend to MCEO, LLC

•
2015-07-01 Property Equipment - Allianz #MXI93067888 - MCEO Inc.

•
2015-07-01 Property Equipment - Allianz #MXI93067888 - amend to MCEO LLC

•
2015-09-09 Worker's Compensation - Chubb-Federal Insurance Co. #16-7174-65-95 -
MCEO LLC

•
2015-09-09 Worker's Compensation - Chubb-Federal Insurance Co. #16-7174-65-95 -
final audit 2015-12-29

•
2015-07-01 Control of Well - Lloyd's #AMW146847 - MCEO Inc.

•
2015-10-15 Control of Well - Lloyd's #AMW146847 - amendment to MCEO, LLC

•
2015-12-31 Control of Well - Lloyd's #AMW146847 - terrorism exclusion

•
2016-01-05 Control of Well - Lloyd's #AMW156987 - MCEO, Inc.

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

BONDS:
•
Mid-Con Energy Operating, LLC – Colorado Oil & Gas Conservation;

◦
Surety ID 2016-0018 Cash Blanket Plugging Bond for $60,000.

•
Mid-Con Energy Operating, LLC – Oklahoma Corporation Commission;

o

Irrevocable Letter of Credit #320 - $25,000.

•
Mid-Con Energy Operating, LLC – Oklahoma Secretary of State;

o

Irrevocable Letter of Credit #321 - $25,000.

•
Mid-Con Energy Operating, LLC – Commissioners of the Land Office, State of
Oklahoma;

o

Irrevocable Letter of Credit #322 - $10,000.

•
Mid-Con Energy Operating, LLC – Texas Railroad Commission;

o

Irrevocable Letter of Credit #323 - $250,000.

•
Mid-Con Energy Operating, LLC – Anadarko E&P Company;

o

Irrevocable Letter of Credit #315 - $50,000.

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

SCHEDULE 5.23
MATERIAL CONTRACTS
•
Unit Agreement for Bivins Rach Penn Unit dated October 15, 2001

•
Unit Operating Agreement for Bivins Ranch Penn Unit dated October 15, 2001

•
Line Well Agreement dated February 1, 2014

•
Unit Agreement for Harker Ranch Morrow Sand Unit dated October 17, 2005

•
Unit Operating Agreement for Harker Ranch Morrow Sand Unit dated October 17,
2005

•
Plan of Unitization for Clawson Ranch Waterflood Unit dated July 1, 1999

•
Plan of Unitization for Eva South Morrow Sand Unit dated November 2, 1992

•
Plan of Unitization for Midwell Waterflood Unit dated March 10, 1993

•
Plan of Unitization for Ona Northwest Morrow Sand Unit dated September 23, 1992

•
Plan of Unitization for War Party Waterflood Unit dated August 23, 2001

•
Plan of Unitization for War Party II Waterflood Unit dated November 5, 2002

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

SCHEDULE 5.24
ENVIRONMENTAL MATTERS
None.

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

SCHEDULE 7.5
OPERATIONS OF BUSINESS
None.

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

SCHEDULE 7.14
Employees
•
Anthony Aton, Field Supervisor

•
Jeremy Lavielle, Fluid Tech

•
John Byrd, Jr., Pumper

•
Guy Dickerson, Pumper

•
Luis Gutierrez, Pumper

•
Jesus Nevarez, Pumper

•
Juan Carlos Rodriguez, Pumper

•
Will Berry, Pumper