Exhibit 10.3
 
NOTICE OF CONFIDENTIALITY RIGHTS:  IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE
OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT BEFORE IT IS
FILED FOR RECORD IN THE PUBLIC RECORDS:  YOUR SOCIAL SECURITY NUMBER OR YOUR
DRIVER'S LICENSE NUMBER.
 

 
CONVEYANCE
 

 
EXILE OIL & GAS COMPANY, a Texas corporation, whose address is 512 Main Street,
Suite 1007, Fort Worth, Texas 76102 (herein called "Grantor"), for Ten Dollars
and other good and valuable consideration (the receipt and sufficiency of which
are hereby acknowledged), does hereby GRANT, BARGAIN, SELL, CONVEY, ASSIGN,
TRANSFER, SET OVER, and DELIVER unto VANGUARD PERMIAN, LLC, a Delaware  limited
liability company, whose address is 7700 San Felipe, Ste 485 Houston, Texas
77063 (herein called "Grantee"), the following described properties, rights and
interests:
 
(a)         The "Gross Working Interests" and "Net Revenue Interests" specified
on Exhibit A attached hereto and made a part hereof in, and in addition thereto,
but subject to the reservation set forth below, all right, title and interest of
Grantor in and to the oil and gas leases described on Exhibit A attached hereto
and made a part hereof (and any extensions, ratifications and amendments
thereof, whether or not the same are described on Exhibit A) and in and to the
wells located thereon; and

(b)           Without limitation of the foregoing, all other right, title and
interest (of whatever kind or character, whether legal or equitable, and whether
vested or contingent) of Grantor in and to the oil, gas and other minerals in
and under or that may be produced from the lands described in Exhibit A hereto
(including interests in oil, gas or mineral leases covering such lands,
overriding royalties, production payments and net profits interests in such
lands or such leases, and fee mineral interests, fee royalty interests and other
interests in such oil, gas and other minerals), whether such lands be described
in a description set forth in such Exhibit A or be described in such Exhibit A
by reference to another instrument (and without limitation by any depth
limitations that may be set forth in such Exhibit A or in any such instrument so
referred to for description), even though Grantor's interest in such oil, gas
and other minerals may be incorrectly described in, or omitted from, such
Exhibit A;
 
(c)           All rights, titles and interests of Grantor in and to, or
otherwise derived from, all presently existing and valid oil, gas or mineral
unitization, pooling, and/or communitization agreements, declarations and/or
orders and in and to the properties covered and the units created thereby
(including all units formed under orders, rules, regulations, or other official
acts of any federal, state, or other authority having jurisdiction, voluntary
unitization agreements, designations and/or declarations) relating to the
properties described in paragraphs (a) and (b) above;
 
(d)           All rights, titles and interests of Grantor in and to all
presently existing and valid production sales (and sales related) contracts,
operating agreements, and other agreements and contracts which relate to any of
the properties described in paragraphs (a), (b) and (c) above, or which relate
to the exploration, development, operation, or maintenance thereof or the
treatment, storage, transportation or marketing of production therefrom (or
allocated thereto);
 
(e)           All rights, titles and interests of Grantor in and to all
materials, supplies, machinery, equipment, improvements and other personal
property and fixtures (including all wells, wellhead equipment, pumping units,
flowlines, tanks, buildings, injection facilities, saltwater disposal
facilities, compression facilities, gathering systems, and other equipment), and
all easements, rights-of-way, surface leases and other surface rights, all
permits and licenses, and all other appurtenances being used or held for use in
connection with, or otherwise related to, the exploration, development,
operation or maintenance of any of the properties described in paragraphs (a),
(b) and (c) above, or the treatment, storage, transportation or marketing of
production therefrom (or allocated thereto); and
 
(f)           All of Grantor's lease files, abstracts and title opinions,
production records, well files, accounting records (but not including general
financial accounting records), seismic records and surveys, gravity maps,
electric logs, geological or geophysical data and records, and other files,
documents and records of every kind and description which relate to the
properties described above.
 
The properties, rights and interests described in subparagraphs (a) through (e)
above, are herein sometimes called the "Properties".
 
TO HAVE AND TO HOLD the Properties unto Grantee, and its successors and assigns,
forever, and Grantor agrees to warrant and forever defend title to the
Properties unto Grantee and its successors and assigns by, through and under
Grantor only, but not otherwise.
 
 Grantee hereby agrees (a) to assume, and to timely pay and perform, all duties,
obligations and liabilities relating to the ownership and/or operation of the
Properties arising or occurring after the Effective Time, and (b) to indemnify
and hold Grantor (and the affiliates of Grantor, and the respective directors,
officers, employees, attorneys, contractors and agents of such affiliates and
Grantor) harmless from and against any and all claims, actions, causes of
action, liabilities, damages, losses, costs or expenses (including, without
limitation, court costs and attorneys' fees) of any kind or character arising
out of or otherwise relating to the duties, obligations and liabilities assumed
by Grantee.  In connection with (but not in limitation of) the foregoing, it is
specifically understood and agreed that such duties, obligations and liabilities
arising out or otherwise relating to the ownership and/or operation of the
Properties arising or occurring after the Effective Time shall (notwithstanding
anything herein appearing to be to the contrary) be deemed to include all
matters arising out of the condition of the Properties on the Effective Time
(including, without limitation, within such matters all obligations to properly
plug and abandon, or replug and re-abandon, wells located on the Properties, to
restore the surface of the Properties and to comply with, or to bring the
Properties into compliance with, applicable environmental laws, rules,
regulations and orders, including conducting any remediation activities which
may be required on or otherwise in connection with activities on the
Properties), regardless of whether such condition or the events giving rise to
such condition arose or occurred before or after the Effective Time, and the
assumptions and indemnifications by Grantee provided for in the first sentence
of this paragraph shall expressly cover and include such matters.  Grantor
hereby agrees (a) to timely pay and perform, all duties, obligations and
liabilities relating to the ownership and/or operation of the Properties arising
or occurring prior to the Effective Time, and (b) to indemnify and hold Grantee
(and the affiliates of Grantee, and the respective directors, officers,
employees, attorneys, contractors and agents of such affiliates and Grantee)
harmless from and against any and all claims, actions, causes of action,
liabilities, damages, losses, costs or expenses (including, without limitation,
court costs and attorneys' fees) of any kind or character arising out of or
otherwise relating to the duties, obligations and liabilities arising or
occurring prior to the Effective Time. THE FOREGOING ASSUMPTIONS AND
INDEMNIFICATIONS SHALL APPLY WHETHER OR NOT SUCH DUTIES, OBLIGATIONS OR
LIABILITIES, OR SUCH CLAIMS, ACTIONS, CAUSES OF ACTION, LIABILITIES, DAMAGES,
LOSSES, COSTS OR EXPENSES ARISE OUT OF (i) NEGLIGENCE (INCLUDING SOLE
NEGLIGENCE, SINGLE NEGLIGENCE, CONCURRENT NEGLIGENCE, ACTIVE OR PASSIVE
NEGLIGENCE, BUT EXPRESSLY NOT INCLUDING GROSS NEGLIGENCE OR WILLFUL MISCONDUCT)
OF ANY INDEMNIFIED PARTY, OR (ii) STRICT LIABILITY.
 
Grantor agrees to execute and deliver to Grantee, from time to time, such other
and additional instruments, notices, division orders, transfer orders and other
documents, and to do all such other and further acts and things as may be
necessary to more fully and effectively grant, convey and assign to Grantee the
Properties.
 
Grantor shall be entitled to all proceeds of production from the Properties and
shall bear all costs, liabilities, obligations and expenses arising from or
related to the ownership and operation of the Properties prior to the Effective
Time (as defined below) and Grantee shall be entitled to all proceeds of
production from the Properties and shall bear all costs, liabilities,
obligations and expenses arising from or related to the ownership and operation
of the Properties after the Effective Time.

Grantor warrants and represents to Grantee that:

1.  
The Properties are free and clear of all liens, charges and encumbrances created
by, through or under Grantor;

2.  
Grantor has the right and power to make the transfer and conveyance effectuated
by this instrument.

This Conveyance may be executed in several counterparts all of which are
identical.  All of such counterparts together shall constitute one and the same
instrument.

IN WITNESS WHEREOF this Conveyance has been executed by the Grantor on the dates
of its acknowledgement, effective as to runs of oil and deliveries of gas, and
for all other purposes, as of 7:00 a.m. Central Time on October 1, 2009 (the
"Effective Time").
 

EXILE OIL & GAS COMPANY

By:           /s/ John S. Tittl                                                 

Title:          President                                                   

STATE OF TEXAS                                                                §
§
COUNTY OF
______________                                                                §

The foregoing instrument was acknowledged before me this _____ day of
_____________, 2009, by ________________, _____________ of EXILE OIL & GAS
COMPANY, a Texas corporation, on behalf of said corporation.
 

____________________________________
Notary Public in and for the State of Texas

Name:__________________________
(typed, printed or stamped)

My Commission Expires:

______________________

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

Exhibit A

Attached to and made a part of that certain Conveyance from Exile Oil & Gas
Company to Vanguard Permian, LLC

LESSOR
LESSEE
LEASE DATE
RECORDING
       
Lochridge, Lloyd P. Jr
Fortson Oil Company
4/1/2003
738/738
Bull, Stephen Medaris
Fortson Oil Company
4/1/2003
738/720
Bull, Jefferson Lochridge
Fortson Oil Company
4/1/2003
738/718
Hartwell, Ware
Fortson Oil Company
4/1/2003
739/632
Hartwell, Jay
Fortson Oil Company
4/1/2003
738/730
Beyer, John L., III
Fortson Oil Company
4/1/2003
741/486
Beyersmith, Holly
Fortson Oil Company
4/1/2003
685/686
Beyer, Andrew L.
Fortson Oil Company
4/1/2003
738/716
Beyer John, Jr. Trust
Fortson Oil Company
4/1/2003
741/488
Massie, Chloe Lochridge
Fortson Oil Company
4/1/2003
738/740
Ross, James B.
Fortson Oil Company
4/1/2003
738/742
Hoover, Wanda Sue
Fortson Oil Company
4/1/2003
740/657
Whitener, Charles C.
Fortson Oil Company
4/1/2003
740/661
Lewis, Ben H. Estate
Fortson Oil Company
4/1/2003
738/736
Kirk, Mary Anne
Fortson Oil Company
4/1/2003
738/734
Graham, Charles Carter
Fortson Oil Company
4/1/2003
738/726
Graham, Ambrose W., Jr.
Fortson Oil Company
4/1/2003
738/746
Chinn, Elizabeth Graham
Fortson Oil Company
4/1/2003
738/724
Graham, Cecilia Louise
Fortson Oil Company
4/1/2003
738/744
Graham, Grady Ross
Fortson Oil Company
4/1/2003
738/728
Graham, Robert Bruce Trust
Fortson Oil Company
4/1/2003
740/659
Carter, Reeves B.
Fortson Oil Company
4/1/2003
738/722
Jones, Susan Carter
Fortson Oil Company
4/1/2003
739/634
Hill, Vernon B. Jr., et al
Fortson Oil Company
4/1/2003
738/732
Seely, Linda Byrd
Fortson Oil Company
2/10/2003
738/445
Stacey, Gretchen
Fortson Oil Company
2/10/2003
738/443
Williamson, Ralph E.
Fortson Oil Company
2/10/2003
738/441
Lord, Hodge Edward
Fortson Oil Company
2/10/2003
738/439
Lord, Brenda Gail
Fortson Oil Company
2/10/2003
738/437
Lord, Kent Edward
Fortson Oil Company
2/10/2003
738/435
Richards, Sidney Lord Trust
Fortson Oil Company
2/10/2003
738/447
Cotugno, Jane L. Martin
Fortson Oil Company
2/10/2003
738/427
Martin, Mark G.
Fortson Oil Company
2/10/2003
738/429
Martin, Roy Jr.
Fortson Oil Company
2/10/2003
738/431
Martin, Stewart K.
Fortson Oil Company
2/10/2003
738/433
Martin, Thomas L.
Fortson Oil Company
2/10/2003
738/748
Uppercu, Ella K. et al
C. L. Milburn
4/21/1962
246/444
McDonnold, M., Jr.
Fortson Oil Company
4/28/2003
739/366
Uppercu, Ella K. et al
C. L. Milburn
4/21/1962
246/444
       

All Memorandum and Leases recorded in the Official Records of Ward County, Texas