EXHIBIT 10.1

 

AMENDED AND RESTATED

BUSINESS OPPORTUNITIES AGREEMENT

 

This AMENDED AND RESTATED BUSINESS OPPORTUNITIES AGREEMENT (this “Agreement”),
dated as of January 31, 2003, is entered into by Dorchester Minerals, L.P., a
Delaware limited partnership (the “Partnership”); Dorchester Minerals Management
LP, a Delaware limited partnership and the general partner of the Partnership
(the “General Partner”); Dorchester Minerals Management GP LLC, a Delaware
limited liability company and the general partner of the General Partner
(“Management GP”); SAM Partners, Ltd., a Texas limited partnership (“SAM”),
Vaughn Petroleum, Ltd., a Texas limited partnership (“Vaughn”), Smith Allen Oil
& Gas, Inc., a Texas corporation (“SAOG”), P.A. Peak, Inc., a Delaware
corporation or any successor thereto by conversion or reorganization (“Peak”),
and James E. Raley, Inc., a Delaware corporation or any successor thereto by
conversion or reorganization (“Raley”) (as used herein, each of SAM, Vaughn,
SAOG, Peak and Raley are referred to as a “GP Party”), and each individual that
both is an executive officer of any Operating Company (defined below) and has
agreed in writing to be bound as an “Officer” under this Agreement (each, an
“Officer”).

 

RECITALS:

 

A Business Opportunities Agreement, dated December 13, 2001, (the “Original
Agreement”) was executed and delivered simultaneously with the execution and
delivery of the Combination Agreement dated December 13, 2001 (the “Combination
Agreement”) among the Partnership, the General Partner, the Management GP,
Dorchester Minerals Operating LP, a Delaware limited partnership and a
subsidiary of the General Partner (the “Operating Subsidiary” and, together with
its general partner, Dorchester Minerals Operating GP LLC, the “Operating
Companies”), Dorchester Hugoton, Ltd., a Texas limited partnership (“DHL”),
Republic Royalty Company, a Texas general partnership (“RRC”), and Spinnaker
Royalty Company, L.P., a Texas limited partnership (“SRC”). Pursuant to the
Combination Agreement, DHL, RRC and SRC will combine their businesses and
properties into the Partnership (the “Transaction”). The parties to the Original
Agreement (i) have, pursuant to that certain letter agreement dated January 22,
2003 (the “Amendment”), amended the Original Agreement and (ii) desire to amend
and restate the Original Agreement in its entirety in this Agreement as of the
date hereof to provide for the following terms and conditions of the Original
Agreement, as amended by the Amendment. All capitalized terms used and not
defined herein (as well as the term person) have the meanings attributable to
them in the Combination Agreement. As used herein, the term “Affiliate” means,
in addition to any “affiliate” as defined in the Combination Agreement, any
owner, director, manager, managing member, officer or employee of any such
affiliate; provided, however, that the Operating Companies shall not be
Affiliates of the General Partner for purposes of this Agreement, and neither
the Operating Companies nor the General Partner shall be Affiliates of any GP
Party for purposes of this Agreement.

 

The GP Parties are currently all of the general partners of RRC, SRC and DHL.
Immediately following the Transaction, the GP Parties will (directly or
indirectly) own all of

 

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the equity of the General Partner and own units of limited partnership interest
in the Partnership.

 

Each of the GP Parties believes that it and its respective partners in RRC, SRC
or DHL, as applicable, will benefit from the Transaction and that the
Transaction is in its best interest and in the best interest of its respective
partners. The GP Parties, however, are unwilling to permit the General Partner,
the Management GP and the Operating Subsidiary to enter into the Combination
Agreement and to agree in the Combination Agreement to enter into the Amended
and Restated Partnership Agreement of the Partnership (the “Partnership
Agreement”) upon the closing of the Transaction unless the respective rights and
responsibilities of the GP Parties, the General Partner, the Management GP, the
Operating Companies and their Affiliates and the Partnership with respect to the
matters addressed in this Agreement are clearly delineated and agreed upon in
advance for the reasons referred to below.

 

The GP Parties engage in the acquisition and ownership of oil and gas
properties, including but not limited to oil and gas net profits interests,
mineral interests and royalty interests in the United States. The businesses in
which the GP Parties engage are similar to those in which the Partnership will
engage following the Transaction.

 

As the owners of the General Partner following the Transaction, the GP Parties
may owe certain duties to the Partnership. Pursuant to the Limited Liability
Company Agreement of Management GP, each GP Party will have the right to
designate a person (the “Designees”) to serve on the committee of managers of
the Management GP following the Transaction. Certain of the Designees may be
directors, members, managers and/or officers of or employed by the General
Partner, an Operating Company, a GP Party, an entity which possesses management
authority over a GP Party, or a company in which the General Partner or a GP
Party has an interest. These Designees will have duties to the Partnership and
duties to the General Partner, an Operating Company, the GP Party or such other
companies (as applicable).

 

The law relating to the duties that the GP Parties or their Designees or
Affiliates may owe to the Partnership is not clear. The application of such law
to particular circumstances is often difficult to predict, and if a court were
to hold that a GP Party or one of their Designees or Affiliates breached any
such duty, the GP Party or such Designee or Affiliate could be held liable for
damages in a legal action brought on behalf of the Partnership.

 

In order to induce the GP Parties to permit the General Partner, the Management
GP and the Operating Subsidiary to enter into the Combination Agreement and/or
the Partnership Agreement, as applicable, the Partnership is willing to enter
into this Agreement in order (i) to renounce, effective upon the consummation of
the Transaction, any interest or expectancy it may have in the classes or
categories of business opportunities specified herein that are presented to or
identified by any Affiliate of the General Partner, a GP Party or any Affiliate
thereof, or any of the Designees, as more fully described herein; (ii) to permit
the GP Parties and their respective Affiliates to continue to conduct their
respective businesses and to

 

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pursue certain business opportunities without an obligation, except as provided
herein, to offer such opportunities to the Partnership, and (iii) to permit any
Designee to continue to discharge his or her responsibilities as a director,
member, manager, officer or employee of the General Partner, an Operating
Company, a GP Party or Affiliate thereof or a company in which a GP Party has an
interest.

 

NOW, THEREFORE, in consideration of the foregoing, the mutual covenants, rights,
and obligations set forth in this Agreement, and the benefits to be derived
herefrom, and other good and valuable consideration, the receipt and the
sufficiency of which each of the parties hereto acknowledges and confesses, the
parties hereto agree as follows:

 

1. Scope of Business of the Partnership Following the Transaction. The
Partnership covenants and agrees that, following consummation of the
Transaction, except with the consent of General Partner (which it may withhold
in its sole discretion), the Partnership will not engage in any business not
allowed by the Partnership Agreement as in effect immediately following the
closing of the Transaction. The Partnership hereby renounces, effective upon
consummation of the Transaction, any interest or expectancy in any business
opportunity (each, together with those business opportunities so designated in
Section 3(d) hereof, a “Renounced Opportunity”) that does not consist of the Oil
and Gas Business (as defined below) within the Designated Area (as defined
below). The “Oil and Gas Business” means the acquisition, management, ownership
or sale of oil and gas assets or properties, including but not limited to
mineral fee interests, net profits interests and royalty and overriding royalty
interests but specifically excluding working interests. “Designated Areas” means
the areas identified on Schedule A attached hereto.

 

2. Business Opportunities. The Partnership recognizes that Affiliates of the
General Partner, the GP Parties and their Affiliates, and the Designees (i)
participate and will continue to participate in the Oil and Gas Business,
directly and through Affiliates, (ii) may have interests in, participate with,
and maintain seats on the boards of directors of or serve as officers, managers,
partners, members or employees of other companies engaged in the Oil and Gas
Business and (iii) may develop business opportunities for the GP Parties and
their Affiliates and such other companies. The Partnership recognizes that the
GP Parties and their Affiliates and the Designees may be engaged in the Oil and
Gas Business in competition with the Partnership. The Partnership:

 

  (a)   acknowledges and agrees that Affiliates of the General Partner, the GP
Parties and their Affiliates, the Designees, and such other companies shall not
be restricted or proscribed by the relationship between the Partnership and
General Partner and/or the Operating Companies, or otherwise, from engaging in
the Oil and Gas Business or any other business, regardless of whether such
business activity is in direct or indirect competition with the business or
activities of the Partnership, if such business activity either

 

  (i)   is a Renounced Opportunity; or

 

 

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  (ii)   is engaged in on any basis that is consistent with the standards set
forth in Section 5 hereof;

 

  (b)   acknowledges and agrees that Affiliates of the General Partner, the GP
Parties and their Affiliates, the Designees, and such other companies shall not
have any obligation to offer the Partnership any business opportunity if either

 

  (i)   such business opportunity is a Renounced Opportunity; or

 

  (ii)   their activities are conducted in accordance with the standards set
forth in Section 5 hereof;

 

  (c)   renounces any interest or expectancy in any business opportunity pursued
by any Affiliate of the General Partner, any GP Party or any Affiliate thereof,
any Designee, or any such other company if such business opportunity either

 

  (i)   is a Renounced Opportunity; or

 

  (ii)   is pursued in accordance with the standards set forth in Section 5
hereof; and

 

  (d)   waives any claim that any business opportunity pursued by any Affiliate
of the General Partner, any GP Party or Affiliate thereof, any Designee, or any
such other company constitutes a business opportunity of the Partnership that
should have been presented to the Partnership, unless such business opportunity
both

 

  (i)   is not a Renounced Opportunity; and

 

  (ii)   was pursued in violation of the standards set forth in Section 5
hereof.

 

The parties agree (x) that, notwithstanding the foregoing, the renouncement and
other matters set forth above in this Section 2 shall not limit the contractual
obligations in Sections 3 and 4 of the persons specified in such Sections 3 and
4, and (y) the contractual obligations contained in Sections 3 and 4 shall not
be limited by virtue of the renouncement and other matters set forth above in
this Section 2.

 

3. Notification of the Partnership Business Opportunities.

 

(a) If (i) a GP Party or any Subsidiary thereof or any Officer or any Subsidiary
thereof has signed a binding agreement to purchase (a “Purchase Agreement”)

 

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oil and gas interests, including but not limited to, (a) oil and gas net profits
interests in the United States, (b) royalty interests and other mineral
interests in the United States, and (c) to the extent such interests are within
the geographic boundaries of any lease, tract, unit or parcel of land then owned
by the Partnership or in which the Partnership at that time has an interest,
working interests and other cost bearing interests (the “Oil and Gas Interests”)
and (ii) the purchase price to be paid for such Oil and Gas Interests is greater
than three percent (3%) of the Market Capitalization of the Partnership (as
defined herein) as determined on the date such Purchase Agreement is fully
executed (a transaction meeting the requirements of both (i) and (ii) shall be
referred to herein as a “Qualifying Acquisition Opportunity”), then such party
(the “Notifying Party”) hereby agrees to provide, or to cause its applicable
Subsidiary to provide, written notice to the Partnership (the “Partnership
Notice”) of the Qualifying Acquisition Opportunity at least 21 days prior to the
consummation the transactions contemplated by the Purchase Agreement, so that
the Partnership may determine whether to pursue the purchase of the Oil and Gas
Interests directly from the seller of the Oil and Gas Interests (the “Seller”).
Beginning on January 1, 2004, a Manager of Management GP that is also an
Affiliate or employee of (a) the GP Parties or any Subsidiary thereof or (b) any
Officer or any Subsidiary thereof shall also be subject to the obligations
provided in this Section 3 and such obligations on such Manager will apply to
all opportunities without regard to the amount of the purchase price to be paid
for such Oil and Gas Interests. As used herein, “Market Capitalization of the
Partnership” shall mean the total value of all outstanding units of limited
partnership interest in the Partnership as determined by the “Current Market
Price” (as defined in the Partnership Agreement). In the event that the purchase
price to be paid by the Notifying Party to the Seller pursuant to the Purchase
Agreement will be paid in consideration other than cash, the value of such
consideration shall be determined by the Advisory Committee (the “Advisory
Committee”) of the Partnership (as defined in the Agreement of Limited
Partnership of the Partnership), upon request of the Notifying Party. At the
option of the Notifying Party, the Notifying Party may (but is not obligated to)
provide the Partnership Notice and the information described in subsection (b)
below with respect to a transaction which would otherwise qualify as a
Qualifying Acquisition Opportunity prior to signing a binding agreement with
respect to such transaction.

 

(b) As general partner of the General Partner, Management GP shall, on behalf of
the Partnership, forward copies of such Partnership Notice and other information
to the persons serving on the Advisory Committee as promptly as practicable upon
the Partnership’s receipt thereof. Within 5 days of receipt of such notice, the
Partnership shall notify the Notifying Party as to whether the Partnership will
exercise its right to pursue such opportunity (the “Partnership Option”), unless
such opportunity reasonably requires a shorter response time, in which case
Notifying Party shall describe the circumstances giving rise to the need for a
shorter response time in the Partnership Notice and the Partnership shall be
required to respond within such shorter time period.

 

(c) If the Partnership timely notifies the Notifying Party of its intent to
exercise a Partnership Option pursuant to subsection (b) above and, within 10
days after

 

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the Partnership’s receipt of the Partnership Notice (or such extended period as
is agreed by the Partnership and the Seller and is specified in a written notice
of the Partnership and the Seller to the Notifying Party), the Notifying Party
receives written notice from the Partnership and the Seller that the Seller
desires to sell the oil and gas interests to the Partnership instead of the
Notifying Party, the Notifying Party hereby agrees to take, or cause to be
taken, any and all commercially reasonable action as is necessary to effect the
termination of the Purchase Agreement between the Notifying Party and the
Seller; provided Seller agrees such termination is to be effective only upon the
execution of a binding agreement between the Partnership and the Seller. Upon
exercise of the Partnership Option, the Partnership is not required to pursue
such Qualifying Acquisition Opportunity on terms identical to those under which
the Notifying Party intended to pursue such opportunity.

 

(d) If the Partnership notifies the Notifying Party that it declines to pursue
such Qualifying Acquisition Opportunity, or fails to respond to a Partnership
Notice within the time period provided in Section 3(b) above, the Notifying
Party shall have no further obligation to the Partnership under this Section 3
with respect to such Qualifying Acquisition Opportunity and, in addition, such
Qualifying Acquisition Opportunity shall be a “Renounced Opportunity” for
purposes of this Agreement even if would not fall within such definition but for
this sentence. If the binding agreement between the Seller and the Partnership
with respect to the Qualifying Acquisition Agreement is terminated, then
notwithstanding any other provision of this Section 3, the Notifying Party may
pursue the relevant Qualifying Acquisition Opportunity without further
obligation under this Section 3.

 

(e) Determinations regarding whether the Partnership shall exercise the
Partnership Option shall be made by the Advisory Committee.

 

4. Other Rights to Purchase by the Partnership.

 

(a) In the event that any GP Party or a Subsidiary thereof or any Officer or any
Subsidiary thereof (each, an “Offeror”) acquires any Oil and Gas Interests or
oil and gas working interests which are located in the Designated Areas or which
as a package include Oil and Gas Interests or oil and gas working interests at
least twenty percent (20%) of the net acreage of which is located within the
Designated Area (any such interests are referred to herein as the “Restricted
Assets”), then not later than one month after the consummation of the
acquisition by such Offeror of the Restricted Assets, such Offeror shall notify
the Partnership of such purchase and offer the Partnership the opportunity to
purchase such Restricted Assets. Such notice shall furnish to the Partnership
all information in Offeror’s possession regarding such the Restricted Assets
that is material to the Partnership’s decision regarding whether or not to
exercise the option set forth in this Section 4. Within twenty (20) days of
receipt of such notice and information (forty (40) days in the event Offeror
notifies the Partnership of more than one such opportunity during the same time
period), the Partnership shall notify the Offeror that either (i) the General
Partner has elected, with the approval of the Advisory

 

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Committee, not to cause the Partnership to purchase such Restricted Assets, in
which event the Offeror shall be forever free to continue to own or operate such
Restricted Assets, or (ii) the General Partner has elected to cause the
Partnership to purchase such Restricted Assets, in which event the closing of
such transaction shall occur on a mutually agreeable date not more than twenty
(20) business days after the date of such notice of intent to exercise the
option. The purchase price, which shall be payable in immediately available
funds, shall be equal to the purchase price paid for the Restricted Assets. In
the event that the Restricted Assets were purchased by the Offeror other than
for cash and the Partnership and the Offeror are unable to agree on the value of
such consideration, the value of such consideration shall be determined (the
“Appraisal”) by an appraiser appointed by mutual agreement of the Partnership
and the Offeror (the “Appraiser”). The fees and expenses of the Appraisal shall
be paid one-half by the Partnership and one-half by the Offeror. The Partnership
and the Offeror shall furnish such information to the Appraiser as shall be
needed to complete the appraisal. Such Appraisal shall be completed within
thirty (30) days after the appointment of Appraiser. The Partnership may revoke
its election to purchase the Restricted Assets within five (5) days of the
receipt of the Appraisal, provided that if the Partnership so elects to revoke,
it shall pay 100% of the fees and expenses of the Appraiser.

 

(b) The General Partner and its Subsidiaries and the GP Parties and their
Subsidiaries shall have no obligation under this Section 4 with respect to
interests or properties which were part of a Qualifying Acquisition Opportunity
if such party has not violated the provisions of Section 3.

 

5. Standards for Separate Conduct of Business. Any GP Party or any Affiliate
thereof, any Designee or any other company in which any Affiliate of the General
Partner, or any GP Party or any Affiliate thereof, has an interest or of which a
Designee is an owner, director, manager, partner, officer or employee (except
for the Management GP, the General Partner and their Subsidiaries) (“Separate
Parties”) shall be deemed to meet the standards referred to in Sections
2(a)(ii), 2(b)(ii), 2(c)(ii) and 2(d)(ii) if its businesses are conducted
entirely through the use of its own personnel and assets and not with the use of
any personnel or assets of the Partnership, the General Partner or the Operating
Subsidiary. Without limiting the foregoing, such standards will be deemed met
with respect to a business opportunity if (a) it is identified by or presented
to such Designee or personnel of such Separate Party and developed and pursued
solely through the use of their personnel and assets (and not based on
confidential information disclosed by or on behalf of the Partnership, the
Management GP, the General Partner or a Subsidiary of the General Partner during
the course of the relationship of such Designee or such Separate Party’s
personnel with the Partnership, the Management GP, the General Partner or a
Subsidiary of the General Partner), and (b) it did not come to the attention of
such Designee or such Separate Party’s personnel in, and as a direct result of,
his or her capacity as a manager of the Management GP or an officer or employee
of the General Partner, an Operating Company or a Subsidiary of either; provided
that (i) if such opportunity is separately identified by a Designee or a
Separate Party or its personnel or separately presented to a Separate Party or
its personnel by a person other than such

 

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Designee, the Separate Party or such personnel, then the Designee, the Separate
Party or its personnel, as applicable, shall be free to pursue such opportunity
even if it also came to such person’s attention as a result of and in his or her
capacity as an owner or manager of the Management GP or a director, manager,
officer or employee of the General Partner, an Operating Company or a Subsidiary
of either and (ii) if such opportunity is presented to or identified by a
Designee, a Separate Party or its personnel other than solely as a result of and
in his or her capacity as an owner or manager of the Management GP or an owner
or employee of the General Partner, an Operating Company or a Subsidiary
thereof, such person shall be free to pursue such opportunity even if it also
came to such person’s attention as a result of and in his or her capacity as an
owner or manager of the Management GP or an owner or employee of the General
Partner, an Operating Company or a Subsidiary of either. Nothing in this
Agreement will allow a Designee or personnel of a Separate Party to usurp a
corporate opportunity solely for his or her personal benefit (as opposed to
pursuing, for the benefit of a Separate Party, an opportunity in accordance with
the standards set forth in this Section 5).

 

6. Ownership of Securities. Notwithstanding the foregoing, neither Section 3 nor
Section 4 shall apply to the purchase or ownership of (i) limited partnership
interests in the Partnership or (ii) securities of any class registered under
Section 12 of the Securities Exchange Act of 1934 (regardless of the types or
locations of businesses in which the issuer thereof engages) if, in the case of
this clause (ii), following any such purchase the applicable party owns, in the
aggregate, less than 5% of such class.

 

7. Termination of Restrictions.

 

(a) All restrictions imposed by this Agreement on any person (other than the
Partnership) shall terminate at such time as the General Partner no longer
serves as a general partner of the Partnership, with respect to any business
opportunity or other matter that is first presented to or becomes known to such
person after such time as the General Partner no longer serves as a general
partner of the Partnership; and shall terminate as to all business opportunities
and other matters six (6) months after such time as the General Partner no
longer serves as a general partner of the partnership, regardless of when such
business opportunity arose or was presented to or became known to such person.

 

(b) Without limiting the generality of Section 7(a), all restrictions imposed by
this Agreement on any Officer shall terminate at such time as such person no
longer serves as an executive officer of any Operating Company, with respect to
any business opportunity or other matter that is first presented to or becomes
known to such person after such time as such person no longer serves as an
executive officer of any Operating Company; and shall terminate as to all
business opportunities and other matters six (6) months after such time as such
Officer no longer serves as an executive officer of any Operating Company,
regardless of when such business opportunity arose or was presented to or became
known to such person.

 

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8. Future Officers. Each GP Party agrees to use commercially reasonable efforts
to cause any person elected or appointed as an executive officer of any
Operating Company to agree to be bound as an “Officer” under this Agreement.

 

9. Waiver of Rights; Amendment. Any rights of the Partnership under this
Agreement, including but not limited to rights to receive certain notices
pursuant to Section 3 and 4, may be waived on behalf of the Partnership by the
Advisory Committee. This Agreement may not be amended by or on behalf of the
Partnership without the approval of the Advisory Committee (as defined in the
Partnership Agreement) of the Partnership.

 

10. Notices. All notices, requests, demands and other communications required or
permitted to be given or made hereunder by any party hereto shall be in writing
and shall be deemed to have been duly given or made if (i) delivered personally,
(ii) transmitted by first class registered or certified mail, postage prepaid,
return receipt requested, (iii) sent by prepaid overnight courier service or
(iv) sent by telecopy or facsimile transmission, answer back requested, to the
parties at the following addresses (or at such other addresses as shall be
specified by the parties by like notice):

 

If to the Partnership, the General Partner or the Management GP:

c/o Dorchester Minerals Management GP LLC

3738 Oak Lawn Ave., Suite 300

Dallas, Texas 75219

Attention: Chief Executive Officer

Telecopy No.: 214-559-0301

 

If to Vaughn:

c/o VPL(GP), LLC

3738 Oak Lawn Ave., Suite 101

Dallas, Texas 75219

Attention: Robert C. Vaughn

Telecopy No.: 214-522-7433

 

with a copy to:

 

c/o VPL(GP), LLC

3738 Oak Lawn Ave., Suite 101

Dallas, Texas 75219

Attention: Benny D. Duncan

Telecopy No.: 214-522-7433

 

If to SAM:

c/o SAM Partners Management, Inc.

3738 Oak Lawn Ave., Suite 300

Dallas, Texas 75219

 

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Attention: H. C. Allen, Jr.

Telecopy No.: 214-559-0301

 

If to SAOG:

3738 Oak Lawn Ave., Suite 300

Dallas, Texas 75219

Attention: William Casey McManemin

Telecopy No.: 214-559-0301

 

If to Peak:

1919 S. Shiloh Rd.

Suite 600 B LB48

Garland, Texas 75042

Attention: Preston A. Peak

Telecopy No.: 972-864-9095

 

If to Raley :

1919 S. Shiloh Rd.

Suite 600 B LB48

Garland, Texas 75042

Attention: James E. Raley

Telecopy No.: 972-864-9095

 

Such notices, requests, demands and other communications shall be effective (i)
if delivered personally or sent by courier service, upon actual receipt by the
intended recipient, (ii) if mailed, upon the earlier of five days after deposit
in the mail or the date of delivery as shown by the return receipt therefor or
(iii) if sent by telecopy or facsimile transmission, when the answer back is
received.

 

11. Binding Effect; Assignment; Third Party Benefit. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided, however, that neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned by
any of the parties hereto (by operation of law or otherwise) without the prior
written consent of the other parties. This Agreement is intended to confer
rights and benefits upon the Designees, Affiliates of the GP Parties and the
companies referred to in Section 2. Except as provided in the preceding
sentence, nothing in this Agreement, express or implied, is intended to or shall
confer upon any person other than the parties hereto any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement.

 

12. Severability. If any provision of this Agreement is held to be
unenforceable, this Agreement shall be considered divisible and such provision
shall be deemed inoperative to the extent it is deemed unenforceable, and in all
other respects this Agreement shall remain in full force and effect; provided,
however, that if any such provision may be made enforceable by limitation
thereof, then such provision shall be

 

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deemed to be so limited and shall be enforceable to the maximum extent permitted
by Applicable Law.

 

13. Injunctive Relief. The parties hereto acknowledge and agree that irreparable
damage would occur in the event any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement, and shall
be entitled to enforce specifically the provisions of this Agreement, in any
court of the United States or any state thereof having jurisdiction, in addition
to any other remedy to which the parties may be entitled under this Agreement or
at law or in equity.

 

14. Miscellaneous. This Agreement may be signed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original, and
such counterparts together shall constitute one instrument. This Agreement shall
be governed by and construed in accordance with the laws of the State of
Delaware, without regard to conflict of law principles.

 

[SIGNATURES APPEAR ON FOLLOWING PAGE]

 

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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of the
date set forth above.

 

DORCHESTER MINERALS, L.P.

By:

 

  Dorchester Minerals Management LP, General

  Partner

   

By:

 

  Dorchester Minerals Management GP LLC,
General Partner

       

By:

 

/s/    JAMES E. RALEY        

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James E. Raley, COO

 

DORCHESTER MINERALS MANAGEMENT LP

By:

 

  Dorchester Minerals Management GP LLC,

  General Partner

   

By:

 

/s/    JAMES E. RALEY        

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James E. Raley, COO

 

DORCHESTER MINERALS MANAGEMENT GP LLC

By:

 

/s/    JAMES E. RALEY        

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James E. Raley, COO

   

 

SAM PARTNERS, LTD.

By:

 

  SAM Partners Management, Inc., General Partner

By:

 

/s/    WILLIAM CASEY MCMANEMIN        

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William Casey McManemin, Vice-President

 

VAUGHN PETROLEUM, LTD.

By:

 

  VPL(GP), LLC, General Partner

By:

 

/s/    ROBERT C. VAUGHN        

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Robert C. Vaughn, Manager

 

SMITH ALLEN OIL & GAS, INC.

By:

 

/s/    WILLIAM CASEY MCMANEMIN, Vice President        

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William Casey McManemin, Vice President

 

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P.A. PEAK, INC.

By:

 

/s/    PRESTON A. PEAK        

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Preston A. Peak, President

 

JAMES E. RALEY, INC.

By:

 

/s/    JAMES E. RALEY        

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James E. Raley, President

 

The following persons are executing this Agreement as “Officers”:

 

/s/    WILLIAM CASEY MCMANEMIN        

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William Casey McManemin

 

/s/    JAMES E. RALEY        

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James E. Raley

 

/s/    H. C. ALLEN, JR.        

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H. C. Allen, Jr.

 

13

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Schedule A

 

Designated Area

 

Texas County, Oklahoma:

 

T 2N - 6N

R 14 ECM - 19 ECM

 

Stevens County, Kansas:

 

T 33S - 35S

R 38W - 39W

 

14