Exhibit 10.1

Execution Version

PURCHASE AGREEMENT

among

CONTANGO OIL & GAS COMPANY

and

THE PURCHASERS PARTY HERETO

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TABLE OF CONTENTS

 

     Page  

ARTICLE I DEFINITIONS

     1  

Section 1.01

 

Definitions

     1  

ARTICLE II AGREEMENT TO SELL AND PURCHASE

     4  

Section 2.01

 

Authorization of Sale of the Purchased Securities

     4  

Section 2.02

 

Sale and Purchase

     4  

Section 2.03

 

Closing

     4  

Section 2.04

 

Conditions to Closing

     5  

Section 2.05

 

Contango Deliveries

     6  

Section 2.06

 

Purchasers’ Deliveries

     6  

Section 2.07

 

Independent Nature of the Purchasers’ Obligations and Rights

     6  

Section 2.08

 

Further Assurances

     7  

ARTICLE III REPRESENTATIONS AND WARRANTIES AND COVENANTS RELATED TO CONTANGO

     7  

Section 3.01

 

Corporate Existence

     7  

Section 3.02

 

Subsidiaries

     7  

Section 3.03

 

Capitalization

     8  

Section 3.04

 

Listing

     8  

Section 3.05

 

Valid Issuance of Purchased Securities

     9  

Section 3.06

 

Authorization

     9  

Section 3.07

 

No Conflicts, Breach or Default

     9  

Section 3.08

 

Approvals

     10  

Section 3.09

 

Permits and Licenses

     10  

Section 3.10

 

Litigation

     10  

Section 3.11

 

Financial Statements

     10  

Section 3.12

 

Internal Controls

     11  

Section 3.13

 

Disclosure Controls

     11  

Section 3.14

 

Reserves

     11  

 

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Section 3.15

 

Stock Plans

     12  

Section 3.16

 

No Material Adverse Change

     12  

Section 3.17

 

Investment Company Status

     12  

Section 3.18

 

Title to Properties

     12  

Section 3.19

 

Rights-of-Way

     13  

Section 3.20

 

Oil and Gas Properties

     13  

Section 3.21

 

Intellectual Property

     13  

Section 3.22

 

Employee Matters

     14  

Section 3.23

 

Environmental Matters

     14  

Section 3.24

 

Tax Matters

     15  

Section 3.25

 

Insurance

     15  

Section 3.26

 

Sarbanes-Oxley Act

     15  

Section 3.27

 

FCPA

     15  

Section 3.28

 

Anti-Money Laundering

     16  

Section 3.29

 

Sanctions

     16  

Section 3.30

 

Dividends, Distributions

     17  

Section 3.31

 

No Preemptive Rights

     17  

Section 3.32

 

Certain Fees

     17  

Section 3.33

 

Stabilization

     17  

Section 3.34

 

Information Technology

     17  

Section 3.35

 

No Registration

     17  

Section 3.36

 

No Integration

     18  

Section 3.37

 

No Disqualification Events

     18  

Section 3.38

 

No General Solicitation

     18  

Section 3.39

 

Shell Company Status

     18  

Section 3.40

 

Related Party Transactions

     18  

Section 3.41

 

Disclosure

     18  

Section 3.42

 

Information on Shareholdings

     19  

Section 3.43

 

Removal of Legend

     19  

 

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ARTICLE IV REPRESENTATIONS AND WARRANTIES AND COVENANTS OF THE PURCHASERS

     20  

Section 4.01

 

Existence

     20  

Section 4.02

 

Authorization, Enforceability

     20  

Section 4.03

 

No Breach

     20  

Section 4.04

 

Certain Fees

     21  

Section 4.05

 

Unregistered Securities.

     21  

Section 4.06

 

No Legal, Tax or Investment Advice

     22  

Section 4.07

 

Short Selling

     22  

ARTICLE V INDEMNIFICATION

     22  

Section 5.01

 

Indemnification by Contango

     22  

Section 5.02

 

Indemnification by the Purchasers

     23  

Section 5.03

 

Indemnification Procedure

     23  

Section 5.04

 

Tax Treatment of Indemnification Payments

     24  

ARTICLE VI TERMINATION

     25  

Section 6.01

 

Termination

     25  

Section 6.02

 

Certain Effects of Termination

     25  

ARTICLE VII MISCELLANEOUS

     25  

Section 7.01

 

Expenses

     25  

Section 7.02

 

Interpretation

     25  

Section 7.03

 

Survival of Provisions

     26  

Section 7.04

 

No Waiver; Modifications in Writing.

     26  

Section 7.05

 

Binding Effect; Assignment

     27  

Section 7.06

 

Communications

     27  

Section 7.07

 

Entire Agreement

     28  

Section 7.08

 

Governing Law; Submission to Jurisdiction

     28  

Section 7.09

 

Waiver of Jury Trial

     28  

Section 7.10

 

Execution in Counterparts

     29  

Section 7.11

 

Recapitalizations, Exchanges, Etc. Affecting the Purchased Securities

     29  

Section 7.12

 

Certain Tax Matters

     29  

 

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SCHEDULE A – Schedule of Purchasers

SCHEDULE B – Schedule of Subsidiaries

EXHIBIT A – Form of Registration Rights Agreement

 

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PURCHASE AGREEMENT

This PURCHASE AGREEMENT, dated as of October 23, 2020 (this “Agreement”), is
entered into by and among Contango Oil & Gas Company, a Texas corporation
(“Contango”), and each of the purchasers set forth in Schedule A hereto (the
“Purchasers”).

RECITALS:

WHEREAS, Contango desires to sell the Purchased Securities (as defined below)
and the Purchasers desire to purchase from Contango the Purchased Securities, in
accordance with the provisions of this Agreement; and

WHEREAS, Contango has agreed to provide the Purchasers with certain registration
rights with respect to the Purchased Securities acquired pursuant hereto.

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Contango and each of the Purchasers, severally and
not jointly, hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions. As used in this Agreement, the following terms have
the meanings indicated:

“Affiliate” means, with respect to a specified Person, any other Person,
directly or indirectly controlling, controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
“control” (including, with correlative meanings, “controlling,” “controlled by”
and “under common control with”) means the power to direct or cause the
direction of the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
provided however, that Contango and the Purchasers shall not be considered
Affiliates for purposes of this Agreement.

“Agreement” has the meaning set forth in the introductory paragraph of this
Agreement.

“Allocated Purchase Price” means with respect to each Purchaser, the dollar
amount set forth opposite such Purchaser’s name under the heading “Allocated
Purchase Price” on Schedule A hereto.

“Basic Documents” means, together, this Agreement and the Registration Rights
Agreement.

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“Business Day” means any day other than a Saturday, Sunday, any federal legal
holiday or day on which banking institutions in the State of Texas are
authorized or required by Law or other governmental action to close.

“Closing” shall have the meaning specified in Section 2.03.

“Closing Date” shall have the meaning specified in Section 2.03.

“Common Stock” means the Common Stock, par value $0.04 per share, of Contango.

“Contango” has the meaning set forth in the introductory paragraph of this
Agreement.

“Contango Bylaws” shall have the meaning specified in Section 3.05.

“Contango Charter” shall have the meaning specified in Section 3.05.

“Contango Related Parties” shall have the meaning specified in Section 5.02.

“Credit Agreement” shall have the meaning specified in Section 3.02.

“Disqualification Event” shall have the meaning specified in Section 3.37.

“Environmental Law” shall have the meaning specified in Section 3.21.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, and the rules and regulations of the SEC promulgated thereunder.

“FCPA” shall have the meaning specified in Section 3.25.

“GAAP” shall have the meaning specified in Section 3.11.

“Indemnified Party” shall have the meaning specified in Section 5.03.

“Indemnifying Party” shall have the meaning specified in Section 5.03.

“Intellectual Property” shall have the meaning specified in Section 3.19.

“Issuer Covered Person” shall have the meaning specified in Section 3.37.

“IT Systems” means, collectively, Contango and its Subsidiaries’ information
technology assets and equipment, computers, systems, networks, hardware,
software, websites, applications, and databases.

“Law” means any federal, state, local or foreign order, writ, injunction,
judgment, settlement, award, decree, statute, law (including common law), rule
or regulation.

 

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“Lien” means any mortgage, claim, encumbrance, pledge, lien (statutory or
otherwise), security agreement, conditional sale or trust receipt or a lease,
consignment or bailment, preference or priority, assessment, deed of trust,
charge, easement, servitude or other encumbrance upon or with respect to any
property of any kind.

“Material Adverse Effect” shall have the meaning specified in Section 3.01.

“Mid-Con” means Mid-Con Energy Partners, a Delaware limited partnership.

“Money Laundering Laws” shall have the meaning specified in Section 3.26.

“NYSE American” means the NYSE American LLC.

“Outside Date” shall have the meaning specified in Section 6.01(a).

“Person” means any individual, corporation, company, voluntary association,
partnership, joint venture, trust, limited liability company, unincorporated
organization, government or any agency, instrumentality or political subdivision
thereof or any other form of entity.

“Placement Agent” means Perry Advisors.

“Property” means any interest in any kind of property or asset, whether real,
personal or mixed, or tangible or intangible.

“Purchased Securities” means, with respect to each Purchaser, the number of
shares of Common Stock as set forth opposite such Purchaser’s name on Schedule A
hereto.

“Purchaser Related Parties” shall have the meaning specified in Section 5.01.

“Purchasers” has the meaning set forth in the introductory paragraph of this
Agreement.

“Registration Rights Agreement” means the Registration Rights Agreement, to be
entered into on or before the Closing, between Contango and the Purchasers in
substantially the form attached hereto as Exhibit A.

“Regulatory Authority” shall have the meaning specified in Section 3.07(a).

“Representatives” means, with respect to a specified Person, the officers,
directors, partners, members, managers, employees, investment advisers, agents,
counsel, accountants, investment bankers and other representatives of such
Person.

“Sanctioned Country” shall have the meaning specified in Section 3.27.

“Sanctioned Person” shall have the meaning specified in Section 3.27.

“Sanctions” shall have the meaning specified in Section 3.27.

 

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“Sarbanes-Oxley Act” shall have the meaning specified in Section 3.24.

“SEC” means the United States Securities and Exchange Commission.

“SEC Reports” means reports and statements filed (but not furnished) by Contango
with the SEC under the Exchange Act, including all amendments, exhibits and
schedules thereto, and documents incorporated by reference therein.

“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations of the SEC promulgated thereunder.

“Short Sales” means, without limitation, all “short sales” as defined in Rule
200 promulgated under Regulation SHO under the Exchange Act, whether or not
against the box, and forward sale contracts, options, puts, calls, short sales,
“put equivalent positions” (as defined in Rule 16a-1(h) under the Exchange Act)
and similar arrangements, and sales and other transactions through non-U.S.
broker dealers or foreign regulated brokers.

“Stock Plan” shall have the meaning specified in Section 3.13.

“Subsidiaries” shall have the meaning specified in Section 3.02.

“TBOC” means the Texas Business Organizations Code.

ARTICLE II

AGREEMENT TO SELL AND PURCHASE

Section 2.01 Authorization of Sale of the Purchased Securities. Contango has
authorized the issuance and sale to the Purchasers of the Purchased Securities
on the terms and subject to the conditions set forth in this Agreement.

Section 2.02 Sale and Purchase. Subject to the terms and conditions hereof,
Contango hereby agrees to issue and sell to each Purchaser, free and clear of
any and all Liens (other than the transfer restrictions under applicable federal
and state securities laws and other than those arising under the TBOC), and each
Purchaser, severally and not jointly, hereby agrees to purchase from Contango,
such number of Purchased Securities on the Closing Date as set forth on Schedule
A, and each Purchaser agrees to pay Contango its Allocated Purchase Price with
respect to such Purchased Securities.

Section 2.03 Closing. Subject to the terms and conditions hereof, the
consummation of the purchase and sale of the Purchased Securities hereunder (the
“Closing”) shall take place at 9:00 a.m. Central Time on October 27, 2020, or
such other date or time as agreed by the parties. The date of the Closing shall
be the “Closing Date.” The parties agree that the Closing may occur via delivery
of facsimiles or portable document format (PDF) documents.

 

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Section 2.04 Conditions to Closing.

(a) Mutual Conditions. The respective obligations of each party to consummate
the purchase and issuance and sale of the Purchased Securities to be purchased
and issued at the Closing shall be subject to the satisfaction on or prior to
the Closing Date of each of the following conditions (any or all of which may be
waived by a particular party on behalf of itself in writing, in whole or in
part, to the extent permitted by applicable Law):

(i) no statute, rule, order, decree or regulation shall have been enacted or
promulgated, and no action shall have been taken, by any Regulatory Authority
which temporarily, preliminarily or permanently restrains, precludes, enjoins or
otherwise prohibits the consummation of the transactions contemplated hereby or
makes the transactions contemplated hereby illegal; and

(ii) there shall not be pending any suit, action or proceeding by any Regulatory
Authority seeking to restrain, preclude, enjoin or prohibit the transactions
contemplated by this Agreement.

(b) Conditions of the Purchasers’ Obligations at the Closing. The respective
obligations of each Purchaser to consummate the purchase of the Purchased
Securities to be purchased by such Purchaser at the Closing shall be subject to
the satisfaction (or waiver by such Purchaser) on or prior to the Closing Date
of each of the following conditions:

(i) the representations and warranties of Contango contained in this Agreement
that are qualified by materiality shall be true and correct as of the Closing
Date as if made on and as of the Closing Date and all other representations and
warranties shall be true and correct in all material respects as of the Closing
Date as if made on and as of the Closing Date (except that representations and
warranties made as of a specific date shall be required to be true and correct
in all material respects as of such date only);

(ii) Contango and the Subsidiaries shall have performed and complied, in all
material respects, with all of the covenants and agreements required to be
performed and complied with by it hereunder on or prior to the Closing Date; and

(iii) Contango shall have delivered, or caused to be delivered, to such
Purchaser, Contango’s closing deliveries described in Section 2.05.

(c) Conditions of Contango’s Obligations at the Closing. The obligation of
Contango to consummate the sale of the Purchased Securities to be sold to each
Purchaser at the Closing shall be subject to the satisfaction (or waiver by
Contango) on or prior to the Closing Date of each of the following conditions:

(i) the representations and warranties of such Purchaser contained in this
Agreement that are qualified by materiality shall be true and correct as of the
Closing Date as if made on and as of the Closing Date and all other
representations and warranties shall be true and correct in all material
respects as of the Closing Date as if made on and as of the Closing Date (except
that representations and warranties made as of a specific date shall be required
to be true and correct in all material respects as of such date only);

 

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(ii) such Purchaser shall have performed and complied, in all material respects,
with all of the covenants and agreements required to be performed and complied
with by such Purchaser on or prior to the Closing Date; and

(iii) such Purchaser shall have delivered, or caused to be delivered, to
Contango such Purchaser’s closing deliveries as described in Section 2.06 of
this Agreement.

Section 2.05 Contango Deliveries. At the Closing, Contango shall deliver or
cause to be delivered to each Purchaser:

(a) reasonably available evidence of the Purchased Securities purchased by such
Purchaser credited to book-entry accounts maintained by the transfer agent of
Contango and issued by Contango free and clear of any Liens, other than the
transfer restrictions under applicable federal and state securities laws and
other than those arising under the TBOC, registered in such names as such
Purchaser shall have designated; provided that DRS statements may be delivered
promptly after the Closing; and

(b) the Registration Rights Agreement in substantially the form attached hereto
as Exhibit A, which shall have been duly executed by Contango.

Section 2.06 Purchasers’ Deliveries. At the Closing, each Purchaser shall
deliver or cause to be delivered to Contango:

(a) subject to receipt of evidence of issuance referred to in Section 2.05(a),
its Allocated Purchase Price as of the Closing Date, such payments to be made by
wire transfers of immediately available funds on the Closing Date to an account
designated by Contango at least two (2) Business Days (or such shorter period of
time as shall be agreeable by such Purchaser and Contango) prior to the Closing
Date; and

(b) the Registration Rights Agreement in substantially the form attached hereto
as Exhibit A, which shall have been duly executed by such Purchaser.

Section 2.07 Independent Nature of the Purchasers’ Obligations and Rights. The
obligations of each Purchaser under any Basic Document are several and not joint
with the obligations of any other Purchaser, and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser under any Basic Document. The failure or waiver of performance under
any Basic Document of any Purchaser by Contango does not excuse performance by
any other Purchaser and the waiver of performance of Contango by any Purchaser
does not excuse performance by Contango with respect to each other Purchaser.
Nothing contained herein or in any other Basic Document, and no action taken by
any Purchaser pursuant thereto, shall be deemed to constitute the Purchasers as
a partnership, an association, a joint venture or any

 

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other kind of entity, or create a presumption that the Purchasers are in any way
acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Basic Documents. Each Purchaser shall be
entitled to independently protect and enforce its rights, including without
limitation, the rights arising out of this Agreement or out of the other Basic
Documents, and it shall not be necessary for any other Purchaser to be joined as
an additional party in any proceeding for such purpose.

Section 2.08 Further Assurances. From time to time after the date hereof,
without further consideration, Contango and the Purchasers shall use their
commercially reasonable efforts to take, or cause to be taken, all actions
necessary or appropriate to consummate the transactions contemplated by this
Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES AND

COVENANTS RELATED TO CONTANGO

Contango represents and warrants to and covenants with each Purchaser as
follows:

Section 3.01 Corporate Existence. Contango has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the State
of Texas, with full corporate power and authority to own, lease and operate its
properties and assets and conduct its business as described in the SEC Reports,
to execute and deliver this Agreement and to issue, sell and deliver the
Purchased Securities as contemplated herein. Contango is duly qualified to do
business as a foreign corporation and is in good standing in each jurisdiction
where the ownership or leasing of its properties and assets or the conduct of
its business requires such qualification, except where the failure to be so
qualified and in good standing would not, individually or in the aggregate,
reasonably be expected to either (i) have a material adverse effect on the
business, properties, condition (financial or otherwise), liquidity, results of
operations or prospects of Contango and the Subsidiaries taken as a whole or
(ii) prevent or materially interfere with consummation of the transactions
contemplated hereby (the occurrence of any such effect or any such prevention or
interference described in the foregoing clauses (i) and (ii) being herein
referred to as a “Material Adverse Effect”).

Section 3.02 Subsidiaries. Contango owns, through wholly owned subsidiaries, the
issued and outstanding capital stock, membership interests, partnership
interests or other ownership interests (as applicable) of each of the entities
listed on Schedule B hereto in the percentages set forth on Schedule B hereto,
which constitute all direct or indirect subsidiaries of Contango. References
herein to “Subsidiaries” refer to the entities listed on Schedule B hereto. Each
Subsidiary has been duly organized and is validly existing and in good standing
under the laws of the jurisdiction of its organization, with full power and
authority to own, lease and operate its properties and assets and to conduct its
business as described in the SEC Reports, except where the failure to be in good
standing would not have a Material Adverse Effect. Each Subsidiary is duly
qualified to do business and is in good standing in each jurisdiction where the
ownership or leasing of its properties and assets or the conduct of its business
requires such qualification, except where the failure to be so qualified and in
good standing would not, individually or in the

 

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aggregate, have a Material Adverse Effect. Except as disclosed in the SEC
Reports, all of the outstanding shares of capital stock of, or other equity
interests in, each of the Subsidiaries have been duly authorized and validly
issued, are fully paid and non-assessable, have been issued in compliance with
all applicable securities laws, were not issued in violation of any preemptive
right, resale right, right of first refusal or similar right and are owned by
Contango or applicable Subsidiary subject to no security interest, other
encumbrance or adverse claims, except for such liens, encumbrances, equities or
claims granted in connection with that certain Credit Agreement, dated as of
September 17, 2019, among Contango, as borrower, JPMorgan Chase Bank, N.A., as
administrative agent, and each of JPMorgan Chase Bank, N.A., Royal Bank of
Canada and Cadence Bank, N.A., as joint bookrunners and the lenders from time to
time party thereto, and as amended, restated or modified from time to time
(collectively, the “Credit Agreement”), or as could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect. No options, warrants
or other rights to purchase, agreements or other obligations to issue or other
rights to convert any obligation into shares of capital stock of, or equity
interests in, the Subsidiaries are outstanding. Contango owns, directly or
indirectly, 37% of the outstanding limited liability company interests in Exaro
Energy III LLC, a Delaware limited liability company, and 23.7% of the
outstanding limited liability company interests in Alta Resources Investments
LLC, a Delaware limited liability company. Such limited liability company
interests are owned by Contango subject to no security interest, other
encumbrance or adverse claims, except for such liens, encumbrances, equities or
claims granted in connection with the Credit Agreement or as could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.

Section 3.03 Capitalization. As of the date of this Agreement, Contango has
400,000,000 shares of Common Stock and 5,000,000 shares of preferred stock
authorized and, prior to the issuance and sale of the Purchased Securities as
contemplated hereby, has 133,038,930 shares of Common Stock issued and
outstanding. All of the issued and outstanding shares of capital stock of
Contango have been duly authorized and validly issued and are fully paid
and non-assessable, have been issued in compliance with all applicable
securities laws and were not issued in violation of any preemptive right, resale
right, right of first refusal or similar right.

Section 3.04 Listing. The Common Stock is duly listed, and admitted and
authorized for trading, on the NYSE American. Contango has not received any
notice from the NYSE American regarding the delisting or potential delisting of
the Common Stock from the NYSE American. Concurrently with the Closing, Contango
shall apply to list or quote all of the Purchased Securities on the NYSE
American and promptly secure the listing of all of the Purchased Securities.
Contango hereby agrees to use commercially reasonable efforts to maintain the
listing or quotation of the Common Stock, including the Purchased Securities
when listed, on the NYSE American and will comply in all respects with
Contango’s reporting, filing and other obligations under the rules and
regulations of the NYSE American. Contango further agrees, if Contango applies
to have the Common Stock traded on any other trading market, it will then
include in such application all of the Purchased Securities, and will take such
other action as is necessary to cause all of the Purchased Securities to be
listed or quoted on such other trading market as promptly as possible. For so
long as Contango maintains a listing or quotation of the Common Stock on the
NYSE American or any other trading market, Contango agrees to maintain the
eligibility of the Common Stock for electronic transfer through the Depository
Trust Company or another established clearing corporation, including, without
limitation, by timely payment of fees to the Depository Trust Company or such
other established clearing corporation in connection with such electronic
transfer.

 

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Section 3.05 Valid Issuance of Purchased Securities. The Purchased Securities
have been duly and validly authorized and, when issued and delivered against
payment therefor as provided herein, will be duly and validly issued, fully paid
and non-assessable and free of statutory and contractual preemptive rights,
resale rights, rights of first refusal and similar rights and any restriction
upon the voting or transfer thereof pursuant to the TBOC or the Amended and
Restated Certificate of Formation of Contango, dated June 14, 2019, as amended
(“Contango Charter”), or the Bylaws of Contango, dated June 14, 2019, as amended
(“Contango Bylaws”), or any agreement or other instrument to which Contango is a
party. No holder of Purchased Securities will be subject to personal liability
by reason of being such a holder.

Section 3.06 Authorization. This Agreement has been duly authorized, executed
and delivered by Contango and the other Basic Documents have been duly
authorized, and will be executed and delivered by Contango on or prior to the
Closing.

Section 3.07 No Conflicts, Breach or Default. (a) Neither Contango nor any of
the Subsidiaries is in breach or violation of or in default under (nor has any
event occurred which, with notice, lapse of time or both, would result in any
breach or violation of, constitute a default under or give the holder of any
indebtedness (or a Person acting on such holder’s behalf) the right to require
the repurchase, redemption or repayment of all or a part of such indebtedness
under) (A) its charter or bylaws or similar organizational documents, or (B) any
indenture, mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other agreement or
instrument to which it is a party or by which it or any of its properties or
assets may be bound or affected, or (C) any U.S. federal, state, local or
foreign law, or (D) any rule or regulation of any U.S. federal, state, local or
foreign governmental or regulatory commission, board, body, authority or agency
or any self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the NYSE American) (collectively, a
“Regulatory Authority”), or (E) any decree, judgment or order applicable to it
or any of its properties, except, in the case of clauses (B), (C), (D) and (E),
to the extent that any such conflict, breach, violation or default would not
reasonably be expected to have a Material Adverse Effect.

(b) The execution, delivery and performance of the Basic Documents, the issuance
and sale of the Purchased Securities and the consummation of the transactions
contemplated hereby do not and will not conflict with, result in any breach or
violation of or constitute a default under (nor constitute any event which, with
notice, lapse of time or both, would result in any breach or violation of,
constitute a default under or give the holder of any indebtedness (or a Person
acting on such holder’s behalf) the right to require the repurchase, redemption
or repayment of all or a part of such indebtedness under) (or result in the
creation or imposition of a lien, charge or encumbrance on any property or asset
of Contango or any Subsidiary pursuant to) (A) the charter or bylaws or similar
organizational document of Contango or any of the Subsidiaries, or (B) any

 

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indenture, mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other agreement or
instrument to which Contango or any of the Subsidiaries is a party or by which
any of them or any of their respective properties or assets may be bound or
affected, or (C) any U.S. federal, state, local or foreign law, or (D) any rule
or regulation of any Regulatory Authority (including, without limitation, the
rules and regulations of the NYSE American), or (E) any decree, judgment or
order applicable to Contango or any of the Subsidiaries or any of their
respective properties or assets.

Section 3.08 Approvals. No approval, authorization, license, registration,
qualification, decree, consent or order of or filing with any Regulatory
Authority or approval of the stockholders of Contango is necessary or required
in connection with the issuance and sale of the Purchased Securities or the
consummation by Contango of the transactions contemplated hereby, other than
(i) any necessary qualification under the state or non-U.S. securities or blue
sky laws of the various jurisdictions in which the Purchased Securities are
being offered, (ii) the filing under the Securities Act of the registration
statement contemplated by the Registration Rights Agreement, and (iii) such
filings as may be required to be made by Contango under the Exchange Act, NYSE
American rules or the Rules of the Financial Industry Regulatory Authority, Inc.

Section 3.09 Permits and Licenses. Each of Contango and the Subsidiaries has all
necessary permits, licenses, authorizations, consents and approvals issued by
the appropriate Regulatory Authorities and has made all necessary filings
required under any applicable law, regulation or rule, and has obtained all
necessary permits, licenses, authorizations, consents and approvals from other
Persons, in order to conduct their respective businesses as described in the SEC
Reports. Neither Contango nor any of the Subsidiaries is in violation of, or in
default under, or has received notice of any proceedings relating to revocation
or modification of, any such permit, license, authorization, consent or approval
or any U.S. federal, state, local or foreign law, regulation or rule or any
decree, judgment or order applicable to Contango or any of the Subsidiaries,
except where such violation, default, revocation or modification would not,
individually or in the aggregate, have a Material Adverse Effect.

Section 3.10 Litigation. Except as disclosed in the SEC Reports, there are no
actions, suits, proceedings, claims, investigations or inquiries pending or, to
Contango’s knowledge, threatened to which Contango or any of the Subsidiaries or
any of their respective directors or officers is or would be a party or of which
any of their respective properties or assets is or would be subject at law or in
equity, before or by any Regulatory Authority, except any such action, suit,
proceeding, claim, investigation or inquiry which, if resolved adversely to
Contango or any Subsidiary, would not, individually or in the aggregate, have a
Material Adverse Effect.

Section 3.11 Financial Statements. The financial statements included or
incorporated by reference in SEC Reports, together with the related notes and
schedules, present fairly the consolidated financial position of Contango and
the Subsidiaries as of the dates indicated and the consolidated results of
operations, cash flows and changes in stockholders’ equity of Contango and the
Subsidiaries for the periods specified and have been prepared in compliance with
the requirements of the Securities Act and the Exchange Act and in conformity
with U.S. generally accepted accounting principles (“GAAP”) applied on a
consistent basis during the periods

 

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involved. The other financial and statistical data included or incorporated by
reference in the SEC Reports are accurately and fairly presented in all material
respects and are prepared on a basis consistent with the financial statements
and books and records of Contango. Other than in connection with the merger
between Contango and Mid-Con, Contango and the Subsidiaries do not have any
material liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not described or incorporated by reference in
the SEC Reports. All disclosures included or incorporated by reference in the
SEC Reports regarding “non-GAAP financial measures” (as such term is defined by
the rules and regulations of the SEC) comply with Regulation G under the
Exchange Act and Item 10 of Regulation S-K under the Securities Act, to the
extent applicable. The interactive data in eXtensible Business Reporting
Language included or incorporated by reference in the SEC Reports fairly
presents the information called for in all material respects and has been
prepared in accordance with the SEC’s rules and guidelines applicable thereto.

Section 3.12 Internal Controls. Contango and each of its Subsidiaries maintain
effective internal control over financial reporting (as defined in Rules 13a-15
and 15d-15 under the Exchange Act) and a system of internal accounting controls
sufficient to provide reasonable assurance that: (i) transactions are executed
in accordance with management’s general or specific authorization;
(ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s general
or specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences. Contango’s independent registered public
accountants and the Audit Committee of the Board of Directors of Contango have
been advised of (1) all significant deficiencies and material weaknesses, if
any, in the design or operation of Contango’s internal control over financial
reporting (whether or not remediated) and (2) all fraud, if any, whether or not
material, that involves management or other employees who have a role in
Contango’s internal control over financial reporting. All significant
deficiencies and material weaknesses, if any, in Contango’s internal control
over financial reporting are disclosed SEC Reports. Since the end of Contango’s
most recent audited fiscal year, except as disclosed in the SEC Reports, there
have not been any changes in Contango’s internal control over financial
reporting that have materially affected, or are reasonably likely to materially
affect, Contango’s internal control over financial reporting.

Section 3.13 Disclosure Controls. Contango and each of its Subsidiaries maintain
effective disclosure controls and procedures (as defined in Rules 13a-15 and
15d-15 under the Exchange Act) designed to ensure that information required to
be disclosed by Contango in the reports it files or submits under the Exchange
Act is recorded, processed, summarized and reported, within the time period
specified in the SEC’s rules and forms, and is accumulated and communicated to
management of Contango, including its principal executive officer and its
principal financial officer, as appropriate, to allow timely decisions regarding
disclosure.

Section 3.14 Reserves. The factual information underlying the estimates of
reserves of Contango and the Subsidiaries included or incorporated by reference
in the SEC Reports, including, without limitation, production, costs of
operation and development, current prices for

 

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production, agreements relating to current and future operations and sales of
production, was true and correct in all material respects on the dates such
estimates were made and such information was supplied and was prepared in
accordance with customary industry practices. Other than normal production of
reserves, intervening market commodity price fluctuations, fluctuations in
demand for such products, adverse weather conditions, unavailability or
increased costs of rigs, equipment, supplies or personnel, the timing of third
party operations and other factors, changes in applicable regulations or
regulatory guidance regarding the rules for estimating reserves, in each case in
the ordinary course of business, and/or in connection with the merger with
Mid-Con, and except as described in the SEC Reports, neither of Contango nor any
of the Subsidiaries is aware of any facts or circumstances that would result in
a material adverse change in the aggregate net reserves, or the aggregate
present value of future net cash flows therefrom, as described in the SEC
Reports.

Section 3.15 Stock Plans. Except as disclosed in the SEC Reports, each stock
option granted under any stock option plan of Contango or any Subsidiary (each,
a “Stock Plan”) was granted with a per share exercise price no less than the
fair market value per share of Common Stock on the grant date of such option,
and no such grant involved any “back-dating,” “forward-dating” or similar
practice with respect to the effective date of such grant. Each such stock
option (i) was granted in compliance with applicable law and with the applicable
Stock Plan(s), (ii) was duly approved by the board of directors (or a duly
authorized committee thereof) of Contango or such Subsidiary, as applicable, and
(iii) has been properly accounted for in Contango’s consolidated financial
statements in accordance with GAAP and disclosed in the SEC Reports.

Section 3.16 No Material Adverse Change. Except as disclosed in the SEC Reports
and/or in connection with the merger with Mid-Con, subsequent to the respective
dates as of which information is given in the SEC Reports, there has not been,
whether or not arising in the ordinary course of business, (i) any material
adverse change, or any development involving a prospective material adverse
change, in the business, properties, management, condition (financial or
otherwise), liquidity, or results of operations of Contango and the Subsidiaries
taken as a whole, (ii) any transaction which is material to Contango and the
Subsidiaries taken as a whole, (iii) any obligation or liability, direct or
contingent (including any off-balance sheet obligations) incurred by Contango or
any Subsidiary that is material to Contango and the Subsidiaries taken as a
whole, (iv) any change in the capital stock of, or other equity interests in, or
outstanding indebtedness of, Contango or any Subsidiaries or (v) any dividend or
distribution of any kind declared, paid or made on the capital stock of, or
other equity interests in, Contango or any Subsidiary.

Section 3.17 Investment Company Status. Neither Contango nor any Subsidiary is,
and, after giving effect to the offer and sale of the Purchased Securities and
the application of the proceeds thereof, neither of them will be, an “investment
company,” as defined in the Investment Company Act of 1940, as amended.

Section 3.18 Title to Properties. Contango and the Subsidiaries have good and
marketable title to all of their interests in oil and gas properties and all
other real property owned by Contango and the Subsidiaries and good title to all
other properties owned by them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or

 

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encumbrances of any kind except such as (i) are disclosed in the SEC Reports,
(ii) arise under the Credit Agreement, (iii) liens and encumbrances under
operating agreements, unitization and pooling agreements, production sales
contracts, farm-out agreements and other oil and gas exploration participation
and production agreements, in each case that secure payment of amounts not yet
due and payable for the performance of other unmatured obligations and are of a
scope and nature customary in the oil and gas industry or arise in connection
with drilling and production operations, or (iv) would not, in the aggregate,
have a Material Adverse Effect. Except as would not, in the aggregate,
reasonably be expected to have a Material Adverse Effect or as described in the
SEC Reports, all of the oil and gas leases of Contango or any of the
Subsidiaries and under which Contango or any of the Subsidiaries holds
properties described in the SEC Reports, are in full force and effect, and
neither Contango nor any of the Subsidiaries has received written notice of any
claim of any sort that has been asserted by anyone adverse to the rights of
Contango or any of the Subsidiaries under any of such leases, or affecting or
questioning the rights of Contango or such Subsidiary to the continued
possession of the leased or subleased premises under any such lease, except for
such claims that would not have a Material Adverse Effect.

Section 3.19 Rights-of-Way. Contango and the Subsidiaries have such consents,
easements, rights-of-way or licenses from any Person (collectively,
“rights-of-way”) as are necessary to enable Contango to conduct its business in
the manner described in the SEC Reports, subject to qualifications as may be set
forth in the SEC Reports, except where failure to have such rights-of-way would
not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.

Section 3.20 Oil and Gas Properties. As of the date hereof, (i) all royalties,
rentals, deposits and other amounts owed under the oil and gas leases
constituting the oil and gas properties of Contango and the Subsidiaries have
been properly and timely paid (other than amounts held in suspense accounts
pending routine payments or related to disputes about the proper identification
of royalty owners and except where the failure to timely pay or pay such amounts
would not reasonably be expected to have a Material Adverse Effect); and no
material amount of proceeds from the sale or production attributable to the oil
and gas properties of Contango and the Subsidiaries are currently being held in
suspense by any purchaser thereof, except where such amounts due would not
reasonably be expected to have a Material Adverse Effect, and (ii) there are no
claims under take-or-pay contracts pursuant to which natural gas purchasers have
any makeup rights affecting the interests of Contango or the Subsidiaries in
their respective oil and gas properties, except where such claims would not
reasonably be expected to have a Material Adverse Effect.

Section 3.21 Intellectual Property. Each of Contango and the Subsidiaries owns,
licenses or otherwise has the right to use all inventions, patent applications,
patents, trademarks (both registered and unregistered), trade names, service
names, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures),
copyrights, service marks and other intellectual property as described in the
SEC Reports and which is necessary for the conduct of, or material to, its
business (collectively, the “Intellectual Property”), and Contango is unaware of
any claim to the contrary or any challenge by any other Person to the rights of
Contango or any of the Subsidiaries with respect to the Intellectual Property.
Neither Contango nor any of the Subsidiaries has infringed or is infringing on
the intellectual property of a third party, and neither Contango nor any
Subsidiary is subject to any pending claim, or aware of any threatened claim, by
a third party to the contrary.

 

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Section 3.22 Employee Matters. Except for matters which would not, individually
or in the aggregate, have a Material Adverse Effect, (i) there is (A) no unfair
labor practice complaint pending or, to Contango’s knowledge, threatened against
Contango or any of the Subsidiaries before the National Labor Relations Board,
and no grievance or arbitration proceeding arising out of or under collective
bargaining agreements is pending or, to Contango’s knowledge, threatened, (B) no
strike, labor dispute, slowdown or stoppage pending or, to Contango’s knowledge,
threatened against Contango or any of the Subsidiaries and (C) no union
representation dispute currently existing concerning the employees of Contango
or any of the Subsidiaries, (ii) to Contango’s knowledge, no union organizing
activities are currently taking place concerning the employees of Contango or
any of the Subsidiaries and (iii) to Contango’s knowledge, there has been no
violation of any federal, state, local or foreign law relating to discrimination
in the hiring, promotion or pay of employees, any applicable wage or hour laws
or any provision of the Employee Retirement Income Security Act of 1974, as
amended, or the rules and regulations promulgated thereunder concerning the
employees of Contango or any of the Subsidiaries.

Section 3.23 Environmental Matters. Contango and the Subsidiaries and their
respective properties, assets and operations are in compliance with, and
Contango and each of the Subsidiaries hold all permits, authorizations and
approvals required under, Environmental Laws (as defined below), except to the
extent that failure to so comply or to hold such permits, authorizations or
approvals would not, individually or in the aggregate, have a Material Adverse
Effect. There are no past or present conditions, circumstances, activities,
practices, actions, omissions or plans that could reasonably be expected to give
rise to any material costs or liabilities to Contango or any Subsidiary under,
or to interfere with or prevent compliance by Contango or any Subsidiary with,
Environmental Laws. Except as would not, individually or in the aggregate, have
a Material Adverse Effect, neither Contango nor any of the Subsidiaries (i) is
the subject of any investigation, (ii) has received any notice or claim,
(iii) is a party to or affected by any pending or, to Contango’s knowledge,
threatened action, suit or proceeding, (iv) is bound by any decree, judgment or
order or (v) has entered into any agreement, in each case relating to any actual
or alleged violation of any Environmental Law or any actual or alleged release
or threatened release or cleanup at any location of any Hazardous Materials (as
defined below) (as used herein, “Environmental Law” means any U.S. federal,
state, local or foreign law, statute, ordinance, rule, regulation, order,
decree, judgment, injunction, permit, license, authorization or other binding
requirement, or common law, relating to the protection of human health, the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife, including, without
limitation, those relating to the distribution, processing, generation,
treatment, storage, disposal, transportation, other handling or release or
threatened release of Hazardous Materials, and “Hazardous Materials” means any
material (including, without limitation, any flammable explosives, radioactive
materials, toxic chemicals, pollutants, contaminants, hazardous or toxic
substances or wastes, petroleum or petroleum products, asbestos-containing
materials or mold) or any other hazardous materials as defined or regulated by
or which

 

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may give rise to liability under any Environmental Law). In the ordinary course
of their business, Contango and each of the Subsidiaries conduct periodic
reviews of the effect of the Environmental Laws on their respective properties,
assets and operations, in the course of which they identify and evaluate
associated costs and liabilities (including, without limitation, any capital or
operating expenditures required for cleanup, closure of properties or compliance
with the Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties).

Section 3.24 Tax Matters. All tax returns required to be filed by Contango or
any of the Subsidiaries have been timely filed, and all taxes and other
assessments of a similar nature (whether imposed directly or through
withholding), including any interest, additions to tax or penalties applicable
thereto due or claimed to be due from such entities, have been timely paid,
other than those being contested in good faith and for which adequate reserves
have been provided or those that would not, individually or in the aggregate,
have a Material Adverse Effect.

Section 3.25 Insurance. Contango and each of the Subsidiaries maintain insurance
covering their respective properties, assets, operations, personnel and
businesses as Contango reasonably deems adequate. Such insurance insures against
such losses and risks to an extent which is adequate in accordance with
customary industry practice for similar companies to protect Contango and the
Subsidiaries and their respective properties, assets, operations, personnel and
businesses in all material respects. All such insurance is fully in force.
Neither Contango nor any Subsidiary has reason to believe that it will not be
able to renew any such insurance as and when such insurance expires.

Section 3.26 Sarbanes-Oxley Act. The principal executive officers (or their
equivalents) and principal financial officers (or their equivalents) of Contango
have made all certifications required by the Sarbanes-Oxley Act of 2002 (the
“Sarbanes-Oxley Act”) and any related rules and regulations promulgated by the
SEC, and the statements contained in each such certification are complete and
correct in all material respects. Contango, the Subsidiaries and Contango’s
directors and executive officers are each in compliance in all material respects
with all applicable effective provisions of the Sarbanes-Oxley Act and the rules
and regulations of the SEC and the NYSE American promulgated thereunder.

Section 3.27 FCPA. Neither Contango nor any of its Subsidiaries nor, to the
knowledge of Contango, any director, officer, agent, employee or Affiliate of
Contango or any of its Subsidiaries is aware of or has taken any action,
directly or indirectly, that would result in a violation by such persons of the
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations
thereunder (the “FCPA”), including, without limitation, making use of the mails
or any means or instrumentality of interstate commerce corruptly in furtherance
of an offer, payment, promise to pay or authorization of the payment of any
money, or other property, gift, promise to give, or authorization of the giving
of anything of value to any “foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any candidate for
foreign political office, in contravention of the FCPA; and Contango, its
Subsidiaries and, to the knowledge of Contango, its Affiliates have conducted
their businesses in compliance with the FCPA and have instituted and maintain
policies and procedures designed to ensure, and which are reasonably expected to
continue to ensure, continued compliance therewith.

 

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Section 3.28 Anti-Money Laundering. The operations of Contango and its
Subsidiaries are and have been conducted at all times in compliance with all
applicable financial recordkeeping and reporting requirements and the money
laundering statutes and the rules and regulations thereunder, including but not
limited to the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the United States Bank Secrecy Act, as amended by the USA PATRIOT Act
of 2001, the United States Money Laundering Control Act of 1986, as amended, and
the applicable anti-money laundering statutes of jurisdictions where Contango
and its Subsidiaries conduct business, the rules and regulations thereunder and
any related or similar rules, regulations or guidelines, issued, administered or
enforced by any governmental agency (collectively, the “Money Laundering Laws”)
and no action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving Contango or any of its
Subsidiaries with respect to the Money Laundering Laws is pending or, to the
best knowledge of Contango, threatened.

Section 3.29 Sanctions. None of Contango, any of its Subsidiaries or, to the
knowledge of Contango, any director, officer, agent, employee or Affiliate of
Contango or any of its Subsidiaries is currently the subject or the target of
any applicable sanctions administered or enforced by the U.S. Government
(including, without limitation, the Office of Foreign Assets Control of the U.S.
Department of the Treasury), the United Nations Security Council, the European
Union, Her Majesty’s Treasury, or other relevant sanctions authority
(collectively, “Sanctions”), nor is Contango or any of its Subsidiaries located,
organized, or resident in a country or territory that is the subject or target
of Sanctions; and Contango will not directly or indirectly use the proceeds of
the offering hereunder, or lend, contribute or otherwise make available such
proceeds to any subsidiary, joint venture partner or other person or entity
(i) to fund any activities of or business with any person, or in any country or
territory, that, at the time of such funding, is the subject of Sanctions or
(ii) in any other manner that will result in a violation by any person
(including any person participating in the transaction, whether as underwriter,
advisor, investor or otherwise) of Sanctions. Neither Contango nor any of its
Subsidiaries nor, to the knowledge of Contango, any director, officer, agent,
employee or Affiliate of Contango or any of its Subsidiaries, is a person that
is, or is 50% or more owned or otherwise controlled by a person that is: (i) the
subject of any Sanctions (a “Sanctioned Person”); or (ii) located, organized or
a resident in a country or territory that is, or whose government is, the
subject of Sanctions that broadly prohibit dealings with that country or
territory (currently, Cuba, Iran, North Korea, Venezuela, Syria and the Crimea
region of Ukraine claimed by Russia) (collectively, “Sanctioned Countries” and
each, a “Sanctioned Country”). Except as has been disclosed to each Purchaser or
is not material to the analysis under any Sanctions, neither Contango nor any of
its Subsidiaries has engaged in any dealings or transactions with or for the
benefit of a Sanctioned Person, or with or in a Sanctioned Country, in the
preceding five (5) years, nor does Contango or any of its Subsidiaries have any
plans to increase its dealings or transactions with Sanctioned Persons, or with
or in Sanctioned Countries.

 

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Section 3.30 Dividends, Distributions. No Subsidiary is currently prohibited,
directly or indirectly, from paying any dividends or making other distributions
to Contango, from repaying to Contango any loans or advances to such Subsidiary
from Contango or from transferring any of such Subsidiary’s properties or assets
to Contango or any other Subsidiary of Contango, except, in each case, as
described in the SEC Reports.

Section 3.31 No Preemptive Rights. The issuance and sale of the Purchased
Securities will not cause any holder of any shares of capital stock, securities
convertible into or exchangeable or exercisable for capital stock or options,
warrants or other rights to purchase capital stock or any other securities of
Contango to have any right to acquire any shares of capital stock of Contango.

Section 3.32 Certain Fees. Other than fees or commissions paid or to be paid to
the Placement Agent in connection with the transactions contemplated by this
Agreement, no fees or commissions are or will be payable by Contango to brokers,
finders or investment bankers with respect to the sale of any of the Purchased
Securities or the consummation of the transactions contemplated by this
Agreement. Contango agrees that it will indemnify and hold harmless each
Purchaser from and against any and all claims, demands, or liabilities by the
Placement Agent or any other Person for broker’s, finder’s, placement, or other
similar fees or commissions incurred by Contango or alleged to have been
incurred by Contango in connection with the sale of the Purchased Securities or
the consummation of the transactions contemplated by this Agreement.

Section 3.33 Stabilization. Neither Contango nor any of the Subsidiaries nor any
of their respective directors, officers, Affiliates or controlling Persons has
taken, directly or indirectly, any action that is designed, or might reasonably
be expected, to cause or result in, or any action that constitutes, the
stabilization or manipulation of the price of any security of Contango to
facilitate the sale or resale of the Purchased Securities or a violation of
Regulation M under the Exchange Act.

Section 3.34 Information Technology. Contango and its Subsidiaries are presently
in material compliance with all applicable laws or statutes and all judgments,
orders, rules and regulations of any court or arbitrator or governmental or
Regulatory Authority, internal policies and contractual obligations relating to
the privacy and security of IT Systems and personal data and to the protection
of such IT Systems and personal data from unauthorized use, access,
misappropriation or modification, except to the extent that failure to so comply
would not, individually or in the aggregate, have a Material Adverse Effect. To
the knowledge of Contango, there has been no security breach or attack or other
compromise of or relating to any of Contango’s and its Subsidiaries’ IT Systems,
except as would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.

Section 3.35 No Registration. Assuming the accuracy of the representations and
warranties of the Purchasers contained in Section 4.05, the issuance and sale of
the Purchased Securities pursuant to this Agreement is exempt from registration
requirements of the Securities Act, and Contango has not taken nor will take any
action hereafter that would cause the loss of such exemption.

 

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Section 3.36 No Integration. Contango has not, directly or through any agent,
issued, sold, offered for sale, solicited offers to buy or otherwise negotiated
in respect of, any security (as defined in the Securities Act), that is or will
be integrated with the issuance and sale of the Purchased Securities
contemplated by this Agreement pursuant to the Securities Act, the rules and
regulations thereunder or the interpretations thereof by the SEC.

Section 3.37 No Disqualification Events. With respect to the Purchased
Securities to be offered and sold hereunder, none of Contango, any of its
predecessors, any affiliated issuer, any director, executive officer, other
officer of Contango participating in the offering hereunder, any beneficial
owner of 20% or more of Contango’s outstanding voting equity securities,
calculated on the basis of voting power, nor any promoter (as that term is
defined in Rule 405 under the Securities Act) connected with Contango in any
capacity at the time of sale (each, an “Issuer Covered Person” and, together,
“Issuer Covered Persons”) is subject to any of the “Bad Actor” disqualifications
described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a
“Disqualification Event”), except for a Disqualification Event covered by Rule
506(d)(2) or (d)(3). Contango has exercised reasonable care to determine whether
any Issuer Covered Person is subject to a Disqualification Event. Other than the
Placement Agent, Contango is not aware of any person (other than any Issuer
Covered Person) that has been or will be paid (directly or indirectly)
remuneration for solicitation of purchasers in connection with the sale of any
Purchased Securities. Contango will notify the Purchasers and the Placement
Agent in writing, prior to the Closing Date of (i) any Disqualification Event
relating to any Issuer Covered Person and (ii) any event that would, with the
passage of time, become a Disqualification Event relating to any Issuer Covered
Person.

Section 3.38 No General Solicitation. Neither Contango, any of its Affiliates
nor any Person acting on behalf of Contango has offered or sold any of the
Purchased Securities by any form of general solicitation or general advertising.
Contango has offered the Purchased Securities for sale only to the Purchasers
and certain other “accredited investors” within the meaning of Rule 501 under
the Securities Act.

Section 3.39 Shell Company Status. Contango is not, and has not been at any time
since December 31, 2000, an issuer identified in Rule 144(i)(1) and satisfies
the requirements in Rule 144(i)(2).

Section 3.40 Related Party Transactions. All transactions that have occurred
between or among Contango, on the one hand, and any of its officers or
directors, or any Affiliates of any such officer or director, on the other hand,
prior to the date hereof that are required to be disclosed by applicable SEC
rules and regulations have been disclosed in the SEC Reports.

Section 3.41 Disclosure. On or before 9:30 a.m., New York local time, on the
Business Day following execution of this Agreement, Contango shall issue a press
release and/or a Current Report on Form 8-K (the “Press Release”) announcing the
entry into this Agreement and describing any other material, nonpublic
information that Contango may have provided any Purchaser at any time prior to
the issuance of the Press Release. On or before the fourth Business Day
following the date hereof, Contango shall file a Current Report on Form 8-K with
SEC

 

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describing the terms of the transactions contemplated by the Basic Documents in
the form required by the Exchange Act. As of the time of the issuance of the
Press Release, no Purchaser shall be in possession of any material, non-public
information received from Contango, any Subsidiary or any of their respective
officers, directors, employees or agents (including the Placement Agent). In
addition, effective upon the issuance of such Press Release, Contango
acknowledges and agrees that any and all confidentiality or similar obligations
under any agreement entered into in connection with the transactions
contemplated hereby, whether written or oral, between Contango, any of its
Subsidiaries or any of their respective officers, directors, agents, employees
or Affiliates on the one hand, and any of the Purchasers or any of their
Affiliates on the other hand, shall terminate. Contango and each Purchaser shall
consult with each other in issuing any other press releases with respect to the
transactions contemplated hereby, and neither Contango nor any Purchaser shall
issue any such press release nor otherwise make any such public statement
without the prior consent of Contango, with respect to any press release of any
Purchaser, or without the prior consent of each Purchaser, with respect to any
press release of Contango, which consent shall not unreasonably be withheld or
delayed, except if such disclosure is required by law, in which case the
disclosing party shall promptly provide the other party with prior notice of
such public statement or communication. Notwithstanding the foregoing, Contango
shall not publicly disclose the name of any Purchaser, or include the name of
any Purchaser in any filing with the SEC or any regulatory agency or NYSE
American, without the prior written consent of such Purchaser, except (a) as
required by federal securities law in connection with the filing of the Basic
Documents with the SEC and (b) to the extent such disclosure is required by law
or NYSE American regulations, in which case Contango shall provide the
Purchasers with prior notice of such disclosure permitted under this clause (b).

Section 3.42 Information on Shareholdings. After the Closing, Contango shall
promptly and accurately respond, and shall use its commercially reasonable
efforts to cause its transfer agent to respond, to reasonable requests for
information (which is otherwise not publicly available) made by a Purchaser or
its auditors relating to the actual holdings of such Purchaser or its accounts;
provided that Contango shall not be obligated to provide any information that
could reasonably result in a violation of applicable law or conflict with
Contango’s insider trading policy or a confidentiality obligation of Contango.

Section 3.43 Removal of Legend. In connection with a sale of the Purchased
Securities by a Purchaser in reliance on Rule 144, the applicable Purchaser or
its broker shall deliver to the transfer agent and Contango a seller or broker
representation letter and an executed stock power with a medallion guarantee,
each as applicable, providing to the transfer agent and Contango any information
deemed reasonably necessary to determine that the sale of the Purchased
Securities is made in compliance with Rule 144, including, as may be
appropriate, a certification that the Purchaser is not an Affiliate of Contango
and regarding the length of time the Purchased Securities have been held. Upon
receipt of such representation letter and stock power, Contango shall promptly
direct its transfer agent to remove the notation of a restrictive legend in such
Purchaser’s book-entry account maintained by the transfer agent, including the
legend referred to in Section 4.05(d), and Contango shall bear all costs
associated therewith. After a registration statement under the Securities Act
permitting the public resale of the Purchased Securities has become effective or

 

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any Purchaser or its permitted assigns have held the Purchased Securities for
one year, if the book-entry account of such Purchased Securities still bears the
notation of the restrictive legend referred to in Section 4.05(d), Contango
agrees, upon request of the Purchaser or permitted assignee, to take all steps
necessary to promptly effect the removal of the legend described in
Section 4.05(d) from the Purchased Securities, and Contango shall bear all costs
associated therewith, regardless of whether the request is made in connection
with a sale or otherwise, so long as such Purchaser or its permitted assigns
provide to Contango any information deemed reasonably necessary to determine
that the legend is no longer required under the Securities Act or applicable
state laws, including (if there is no such registration statement) a
certification that the holder is not an Affiliate of Contango and regarding the
length of time the Purchased Securities have been held.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES AND

COVENANTS OF THE PURCHASERS

Each Purchaser, severally and not jointly, hereby represents and warrants and
covenants to Contango as follows:

Section 4.01 Existence. Such Purchaser is duly organized and validly existing
and in good standing under the laws of its state of formation, with all
necessary power and authority to own properties and to conduct its business as
currently conducted.

Section 4.02 Authorization, Enforceability. Such Purchaser has all necessary
legal power and authority to execute, deliver and perform its obligations under
the Basic Documents to which such Purchaser is or will be a party. The
execution, delivery and performance by such Purchaser of the Basic Documents to
which such Purchaser is or will be a party and the consummation by it of the
transactions contemplated hereby and thereby have been duly and validly
authorized by all necessary legal action, and no further consent or
authorization of such Purchaser is required. This Agreement to which such
Purchaser is a party has been duly and validly authorized, executed and
delivered by such Purchaser and constitutes the legal, valid and binding
obligation of such Purchaser and, when executed by such Purchaser, the other
Basic Documents to which such Purchaser is a party will be duly and validly
authorized, executed and delivered by such Purchaser and will constitute the
legal, valid and binding obligations of such Purchaser, in each case enforceable
in accordance with their terms, except as such enforceability may be limited by
bankruptcy, insolvency, fraudulent transfer and similar laws affecting
creditors’ rights generally or by general principles of equity and except as the
rights to indemnification may be limited by applicable law.

Section 4.03 No Breach. The execution, delivery and performance by such
Purchaser of the Basic Documents and the consummation by such Purchaser of the
transactions contemplated hereby or thereby does not and will not (a) assuming
the accuracy of the representations and warranties of Contango contained herein
and its compliance with the covenants contained herein, violate any provision of
any Law or permit having applicability to such Purchaser or the property or
assets of such Purchaser, (b) conflict with or result in a violation or breach
of any provision of the organizational documents of such Purchaser, or
(c) conflict with or result in a breach or

 

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violation of any of the terms or provisions of, or constitute a default under,
any material agreement to which such Purchaser is a party or by which such
Purchaser is bound or to which any of the property or assets of such Purchaser
is subject, except in the case of clauses (a) and (c), for such conflicts,
breaches, violations or defaults as would not have a material adverse effect on
the ability of such Purchaser to consummate the transactions contemplated by the
Basic Documents.

Section 4.04 Certain Fees. No fees or commissions are or will be payable by such
Purchaser to brokers, finders or investment bankers with respect to the purchase
of any of the Purchased Securities or the consummation of the transactions
contemplated by this Agreement.

Section 4.05 Unregistered Securities.

(a) Accredited Investor Status; Sophisticated Purchasers. Such Purchaser is an
“accredited investor” within the meaning of Rule 501 under the Securities Act
and is able to bear the risk of its investment in the Purchased Securities. Such
Purchaser has such knowledge and experience in financial and business matters
that it is capable of evaluating the merits and risks of the purchase of the
Purchased Securities.

(b) Information. Such Purchaser and its Representatives have been furnished with
all materials relating to the business, finances and operations of Contango that
have been requested and materials relating to the offer and sale of the
Purchased Securities that have been requested by such Purchaser and its
Representatives. Such Purchaser and its Representatives have been afforded the
opportunity to ask questions of Contango. Neither such inquiries nor any other
due diligence investigations conducted at any time by such Purchaser and its
Representatives shall modify, amend or affect such Purchaser’s right (i) to rely
on Contango’s representations and warranties contained in Article III above or
(ii) to indemnification or any other remedy based on, or with respect to the
accuracy or inaccuracy of, or compliance with, the representations, warranties,
covenants and agreements in this Agreement, or any other Basic Document. Such
Purchaser understands that the purchase of the Purchased Securities involves a
high degree of risk. Such Purchaser has sought such accounting, legal and tax
advice as it has considered necessary to make an informed investment decision
with respect to its acquisition of the Purchased Securities.

(c) Cooperation. Such Purchaser shall cooperate reasonably with Contango to
provide any information necessary for any applicable securities filings required
to be made by Contango in connection with the transactions contemplated hereby.

(d) Legends. Such Purchaser understands that the Purchased Securities will bear
a restrictive legend substantially in the form as set forth below:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS.
THESE SECURITIES MAY NOT BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.

 

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(e) Purpose of Purchase. Such Purchaser is purchasing the Purchased Securities
for its own account and not with a view to distribution in violation of any
securities laws. Such Purchaser has been advised and understands that the
Purchased Securities have not been registered under the Securities Act or under
the “blue sky” laws of any jurisdiction and may be resold only if registered
pursuant to the provisions of the Securities Act (or if eligible, pursuant to
the provisions of Rule 144 promulgated under the Securities Act or pursuant to
another available exemption from the registration requirements of the Securities
Act).

(f) Rule 144. Such Purchaser understands that the Purchased Securities must be
held indefinitely unless and until the Purchased Securities are registered for
resale under the Securities Act or an exemption from such registration is
available. Such Purchaser has been advised by its advisors of and is aware of
the provisions of Rule 144 promulgated under the Securities Act.

(g) Reliance by Contango. Such Purchaser understands that the Purchased
Securities are being offered and sold in reliance on transactional exemptions
from the registration requirements of federal and state securities laws and that
Contango is relying upon the truth and accuracy of the representations,
warranties, covenants, acknowledgments and understandings of such Purchaser set
forth herein in order to determine the applicability of such exemptions and the
suitability of such Purchaser to acquire the Purchased Securities.

Section 4.06 No Legal, Tax or Investment Advice. Such Purchaser understands that
nothing in this Agreement or any other materials presented by or on behalf of
Contango to the Purchaser in connection with the offer and sale of the Purchased
Securities constitutes legal, tax or investment advice. Such Purchaser has
consulted such legal, tax and investment advisors as it, in its sole discretion,
has deemed necessary or appropriate in connection with its purchase of the
Purchased Securities. Such Purchaser understands that the Placement Agent has
acted solely as the agents of Contango in this placement of the Purchased
Securities, and that the Placement Agent makes no representation or warranty
with regard to the merits of this transaction or as to the accuracy of any
information such Purchaser may have received in connection therewith. Such
Purchaser acknowledges that it has not relied on any information or advice
furnished by or on behalf of the Placement Agent.

Section 4.07 Short Selling. Such Purchaser has not engaged in any Short Sales
involving Common Stock owned by it between the time it first began discussions
with Contango about the transaction contemplated by this Agreement and the date
of execution of this Agreement.

ARTICLE V

INDEMNIFICATION

Section 5.01 Indemnification by Contango. Contango agrees to indemnify each
Purchaser and its Representatives (collectively, “Purchaser Related Parties”)
from, and hold each of them harmless against, any and all losses, actions,
suits, proceedings (including any investigations, litigation or inquiries),
demands and causes of action, and, in connection therewith, and promptly upon
demand, pay or reimburse each of them for all reasonable costs, losses,

 

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liabilities, damages or expenses of any kind or nature whatsoever (including the
reasonable fees and disbursements of counsel and all other reasonable expenses
incurred in connection with investigating, defending or preparing to defend any
such matter that may be incurred by them or asserted against or involve any of
them), involving a third party claim, as a result of, arising out of, or in any
way related to (i) the failure of any of the representations or warranties made
by Contango contained herein to be true and correct in all material respects as
of the date hereof (except with respect to any provisions including the word
“material” or words of similar import, with respect to which such
representations and warranties must have been true and correct) or (ii) the
material breach of any covenants of Contango contained herein, provided that, in
the case of the immediately preceding clause (i), such claim for indemnification
is made prior to the expiration of such representation or warranty; provided,
however, that for purposes of determining when an indemnification claim has been
made, the date upon which a Purchaser Related Party shall have given notice
(stating in reasonable detail the basis of the claim for indemnification) to
Contango shall constitute the date upon which such claim has been made.

Section 5.02 Indemnification by the Purchasers. Each Purchaser agrees, severally
and not jointly, to indemnify Contango and its respective Representatives
(collectively, “Contango Related Parties”) from, and hold each of them harmless
against, any and all losses, actions, suits, proceedings (including any
investigations, litigation or inquiries), demands and causes of action, and, in
connection therewith, and promptly upon demand, pay or reimburse each of them
for all reasonable costs, losses, liabilities, damages or expenses of any kind
or nature whatsoever (including the reasonable fees and disbursements of counsel
and all other reasonable expenses incurred in connection with investigating,
defending or preparing to defend any such matter that may be incurred by them or
asserted against or involve any of them), involving a third party claim, as a
result of, arising out of, or in any way related to (i) the failure of any of
the representations or warranties made by such Purchaser contained herein to be
true and correct in all material respects as of the date hereof or (ii) the
material breach of any of the covenants of such Purchaser contained herein,
provided that, in the case of the immediately preceding clause (i), such claim
for indemnification relating to a breach of any representation or warranty is
made prior to the expiration of such representation or warranty; provided,
however, that for purposes of determining when an indemnification claim has been
made, the date upon which a Contango Related Party shall have given notice
(stating in reasonable detail the basis of the claim for indemnification) to
such Purchaser shall constitute the date upon which such claim has been made;
provided, further, that the liability of such Purchaser shall not be greater in
amount than such Purchaser’s Allocated Purchase Price.

Section 5.03 Indemnification Procedure. A claim for indemnification for any
matter not involving a third party claim may be asserted by notice to the party
from whom indemnification is sought; provided, however, that failure to so
notify the Indemnifying Party shall not preclude the Indemnified Party from any
indemnification which it may claim in accordance with this Article V, except as
otherwise provided in Sections 5.01 and 5.02. Promptly after any Contango
Related Party or Purchaser Related Party (hereinafter, the “Indemnified Party”)
has received notice of any indemnifiable claim hereunder, or the commencement of
any action, suit or proceeding by a third Person, which the Indemnified Party
believes in good faith is an indemnifiable claim under this

 

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Agreement, the Indemnified Party shall give the indemnitor hereunder (the
“Indemnifying Party”) written notice of such claim or the commencement of such
action, suit or proceeding, but failure to so notify the Indemnifying Party will
not relieve the Indemnifying Party from any liability it may have to such
Indemnified Party hereunder except to the extent that the Indemnifying Party is
materially prejudiced by such failure. Such notice shall state the nature and
the basis of such claim to the extent then known. The Indemnifying Party shall
have the right to defend and settle, at its own expense and by its own counsel,
any such matter as long as the Indemnifying Party pursues the same diligently
and in good faith. If the Indemnifying Party undertakes to defend or settle such
claim, it shall promptly after such determination, and in no event later than
five (5) days, notify the Indemnified Party of its intention to do so, and the
Indemnified Party shall cooperate with the Indemnifying Party and its counsel in
all commercially reasonable respects in the defense thereof and/or the
settlement thereof. Such cooperation shall include, but shall not be limited to,
furnishing the Indemnifying Party with any books, records and other information
reasonably requested by the Indemnifying Party and in the Indemnified Party’s
possession or control relevant to the claim. Such cooperation of the Indemnified
Party shall be at the cost of the Indemnifying Party. After the Indemnifying
Party has notified the Indemnified Party of its intention to undertake to defend
or settle any such asserted liability, and for so long as the Indemnifying Party
diligently pursues such defense, the Indemnifying Party shall not be liable for
any additional legal expenses incurred by the Indemnified Party in connection
with any defense or settlement of such asserted liability; provided, however,
that the Indemnified Party shall be entitled (i) at its expense, to participate
in the defense of such asserted liability and the negotiations of the settlement
thereof and (ii) if (A) the Indemnifying Party has, within ten (10) Business
Days of when the Indemnified Party provides written notice of a claim, failed
(y) to assume the defense or settlement of such claim and employ counsel or
(z) to notify the Indemnified Party of such assumption, or (B) if the defendants
in any such action include both the Indemnified Party and the Indemnifying Party
and counsel to the Indemnified Party shall have concluded that there may be
reasonable defenses available to the Indemnified Party that are different from
or in addition to those available to the Indemnifying Party or if the interests
of the Indemnified Party reasonably may be deemed to conflict with the interests
of the Indemnifying Party, then the Indemnified Party shall have the right to
select a separate counsel and to assume such legal defense and otherwise to
participate in the defense of such action, with the expenses and fees of such
separate counsel and other expenses related to such participation to be
reimbursed by the Indemnifying Party as incurred. Notwithstanding any other
provision of this Agreement, the Indemnifying Party shall not settle any
indemnified claim without the consent of the Indemnified Party, unless the
settlement thereof imposes no liability or obligation on, and includes a
complete release from liability of, and does not contain any admission of wrong
doing by, the Indemnified Party.

Section 5.04 Tax Treatment of Indemnification Payments. Any indemnification
payments made under this Article V shall be treated for all tax purposes as an
adjustment to the relevant Purchaser’s Allocated Purchase Price except as
otherwise required by applicable Law.

 

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ARTICLE VI

TERMINATION

Section 6.01 Termination. Notwithstanding anything in this Agreement to the
contrary, this Agreement may be terminated at any time:

(a) by any Purchaser (with respect to the obligations of such Purchaser) or
Contango, upon written notice to the other party, if the Closing shall not have
occurred on or before November 2, 2020 (the “Outside Date”); provided, however,
that the right to terminate this Agreement under this Section 6.01(a) shall not
be available to any party whose (i) breach of any provision of this Agreement,
(ii) failure to comply with its obligations under this Agreement or
(iii) actions not taken in good faith shall have been the cause of, or shall
have resulted in, the failure of the Closing to occur on or prior to the Outside
Date or the failure of a condition in Section 2.04(b) or Section 2.04(c) to be
satisfied at such time; or

(b) by either Contango or any Purchaser (with respect to the obligations of such
Purchaser) if any court of competent jurisdiction in the United States or other
United States Regulatory Authority shall have issued a final order, decree or
ruling or taken any other final action restraining, enjoining or otherwise
prohibiting the transactions contemplated hereby and such order, decree, ruling
or other action is or shall have become final and nonappealable.

Section 6.02 Certain Effects of Termination. If this Agreement is terminated as
provided in Section 6.01, except as set forth in Section 7.03, this Agreement
shall become null and void and have no further force or effect, but the parties
shall not be released from any liability arising from or in connection with any
breach hereof occurring prior to such termination.

ARTICLE VII

MISCELLANEOUS

Section 7.01 Expenses. All other costs and expenses, including, without
limitation, fees and disbursements of counsel, financial advisors and
accountants, incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such costs and
expenses, whether or not the Closing shall have occurred.

Section 7.02 Interpretation. Article, Section, Schedule and Exhibit references
in this Agreement are references to the corresponding Article, Section, Schedule
or Exhibit to this Agreement, unless otherwise specified. All Exhibits and
Schedules to this Agreement are hereby incorporated and made a part hereof as if
set forth in full herein and are an integral part of this Agreement. All
references to instruments, documents, contracts and agreements are references to
such instruments, documents, contracts and agreements as the same may be
amended, supplemented and otherwise modified from time to time, unless otherwise
specified. The word “including” shall mean “including but not limited to” and
shall not be construed to limit any general statement that it follows to the
specific or similar items or matters immediately following it. Whenever Contango
has an obligation under the Basic Documents, the expense of complying with that
obligation shall be an expense of Contango unless otherwise specified. Any
reference in

 

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this Agreement to $ shall mean U.S. dollars. Whenever any determination, consent
or approval is to be made or given by any Purchaser, such action shall be in
such Purchaser’s sole discretion, unless otherwise specified in this Agreement.
If any provision in the Basic Documents is held to be illegal, invalid, not
binding or unenforceable, (i) such provision shall be fully severable and the
Basic Documents shall be construed and enforced as if such illegal, invalid, not
binding or unenforceable provision had never comprised a part of the Basic
Documents, and the remaining provisions shall remain in full force and effect
and (ii) the parties hereto shall negotiate in good faith to modify the Basic
Documents so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated
hereby are consummated as originally contemplated to the greatest extent
possible. When calculating the period of time before which, within which or
following which any act is to be done or step taken pursuant to the Basic
Documents, the date that is the reference date in calculating such period shall
be excluded. If the last day of such period is a non-Business Day, the period in
question shall end on the next succeeding Business Day. Any words imparting the
singular number only shall include the plural and vice versa. The words such as
“herein,” “hereinafter,” “hereof” and “hereunder” refer to this Agreement as a
whole and not merely to a subdivision in which such words appear unless the
context otherwise requires. The provision of a Table of Contents, the division
of this Agreement into Articles, Sections and other subdivisions and the
insertion of headings are for convenience of reference only and shall not affect
or be utilized in construing or interpreting this Agreement.

Section 7.03 Survival of Provisions. The representations and warranties set
forth in Sections 3.01, 3.02, 3.03, 3.05, 3.06, 3.30, 4.02, 4.04 and 4.05
hereunder shall survive the execution and delivery of this Agreement for a
period of one (1) year, and the other representations and warranties set forth
herein shall survive for a period of six (6) months following the final Closing
Date regardless of any investigation made by or on behalf of Contango or a
Purchaser. The covenants made in this Agreement shall survive the final Closing
and remain operative and in full force and effect regardless of acceptance of
any of the Purchased Securities and payment therefor and repayment, conversion
or repurchase thereof. Regardless of any purported general termination of this
Agreement, the provisions of Article V and all indemnification rights and
obligations of Contango and the Purchasers thereunder, Section 6.02 and this
Article VII shall remain operative and in full force and effect as between
Contango and each Purchaser, unless Contango and each Purchaser execute a
writing that expressly (with specific references to the applicable Section or
subsection of this Agreement) terminates such rights and obligations as between
Contango and such Purchaser.

Section 7.04 No Waiver; Modifications in Writing.

(a) Delay. No failure or delay on the part of any party in exercising any right,
power or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or remedy preclude any other
or further exercise thereof or the exercise of any other right, power or remedy.
The remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to a party at law or in equity or otherwise.

 

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(b) Specific Waiver. Except as otherwise provided herein, no amendment, waiver,
consent, modification or termination of any provision of this Agreement or any
other Basic Document shall be effective unless signed by each of the parties
hereto or thereto affected by such amendment, waiver, consent, modification or
termination. Any amendment, supplement or modification of or to any provision of
this Agreement or any other Basic Document, any waiver of any provision of this
Agreement or any other Basic Document and any consent to any departure by
Contango from the terms of any provision of this Agreement or any other Basic
Document shall be effective only in the specific instance and for the specific
purpose for which made or given. Except where notice is specifically required by
this Agreement, no notice to or demand on Contango in any case shall entitle
Contango to any other or further notice or demand in similar or other
circumstances. Any investigation by or on behalf of any party shall not be
deemed to constitute a waiver by the party taking such action of compliance with
any representation, warranty, covenant or agreement contained herein.

Section 7.05 Binding Effect; Assignment.

(a) Binding Effect. This Agreement shall be binding upon Contango, each
Purchaser and their respective successors and permitted assigns. Except as
expressly provided in this Agreement, this Agreement shall not be construed so
as to confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and permitted assigns.

(b) Assignment of Rights. Without the written consent of Contango, no portion of
the rights and obligations of any Purchaser under this Agreement may be assigned
or transferred by such Purchaser. No portion of the rights and obligations of
Contango under this Agreement may be transferred or assigned without the prior
written consent of the Purchasers.

Section 7.06 Communications. All notices and demands provided for hereunder
shall be (i) in writing and shall be given by registered or certified mail,
return receipt requested, air courier guaranteeing overnight delivery or
personal delivery, and (ii) via e-mail, to the following addresses:

(a) If to the Purchasers:

At such address indicated on Schedule A attached hereto.

(b) If to Contango:

Contango Oil & Gas Company

717 Texas Avenue, Suite 2900

Houston, Texas 77002

Attention: Wilkie S. Colyer, Jr.

E-mail: WColyer@contango.com

 

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with a copy (which shall not constitute notice) to:

Gibson, Dunn & Crutcher LLP

811 Main Street, Suite 3000

Houston, Texas 77002

Attention: Hillary H. Holmes

E-mail: HHolmes@gibsondunn.com

or to such other address as Contango or such Purchaser may designate in writing.
All notices and communications shall be deemed to have been duly given: at the
time delivered by hand, if personally delivered; upon actual receipt if sent by
certified or registered mail, return receipt requested, or regular mail, if
mailed; upon actual receipt if sent by overnight courier copy; when receipt is
acknowledged, if sent via e-mail; and upon actual receipt when delivered to an
air courier guaranteeing overnight delivery.

Section 7.07 Entire Agreement. This Agreement, the other Basic Documents and the
other agreements and documents referred to herein are intended by the parties as
a final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and therein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein or the other Basic Documents with respect to the rights
granted by Contango or any of its Affiliates or the Purchasers or any of their
Affiliates set forth herein or therein. This Agreement, the other Basic
Documents and the other agreements and documents referred to herein or therein
supersede all prior agreements and understandings between the parties with
respect to such subject matter.

Section 7.08 Governing Law; Submission to Jurisdiction. This Agreement, and all
claims or causes of action (whether in contract or tort) that may be based upon,
arise out of or relate to this Agreement or the negotiation, execution or
performance of this Agreement (including any claim or cause of action based
upon, arising out of or related to any representation or warranty made in or in
connection with this Agreement), will be construed in accordance with and
governed by the laws of the State of Texas without regard to principles of
conflicts of laws. Any action against any party relating to the foregoing shall
be brought in any federal or state court of competent jurisdiction located
within the State of Texas, and the parties hereto hereby irrevocably submit to
the non-exclusive jurisdiction of any federal or state court located within the
State of Texas over any such action. The parties hereby irrevocably waive, to
the fullest extent permitted by applicable Law, any objection which they may now
or hereafter have to the laying of venue of any such dispute brought in such
court or any defense of inconvenient forum for the maintenance of such dispute.
Each of the parties hereto agrees that a judgment in any such dispute may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by Law.

Section 7.09 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT EACH
HEREBY WAIVES, AND AGREES TO CAUSE ITS AFFILIATES TO WAIVE, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION (i) ARISING UNDER THIS

 

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AGREEMENT OR (ii) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO IN RESPECT OF THIS AGREEMENT OR ANY OF THE
TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. EACH OF THE PARTIES
TO THIS AGREEMENT HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE
PARTIES TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS
AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

Section 7.10 Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which counterparts, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, taken together, shall constitute
but one and the same Agreement. A signed copy of this Agreement delivered by
facsimile, portable document format (PDF) or other means of electronic
transmission shall be deemed to have the same legal effect as delivery of an
original signed copy of this Agreement; provided, however, that each party
hereto shall deliver an original signed copy of this Agreement executed by such
party to any other party hereto promptly upon the request of any such other
party.

Section 7.11 Recapitalizations, Exchanges, Etc. Affecting the Purchased
Securities. The provisions of this Agreement shall apply to the full extent set
forth herein with respect to any and all equity interests of Contango or any
successor or assign of Contango (whether by merger, consolidation, sale of
assets or otherwise) which may be issued in respect of, in exchange for or in
substitution of, the Purchased Securities.

Section 7.12 Certain Tax Matters. Contango agrees that, provided that each
Purchaser delivers to Contango a properly executed IRS Form W-9, or similar form
sufficient under current Law to cause Contango (including any paying agent of
Contango) to avoid a requirement to withhold on any payments or deemed payments
to any such Purchaser, Contango (including any paying agent of Contango) will
not withhold on any payments or deemed payments to any such Purchaser.

[Remainder of Page Left Intentionally Blank]

 

29

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IN WITNESS WHEREOF, the parties hereto execute this Agreement, effective as of
the date first above written.

 

CONTANGO OIL & GAS COMPANY By:   /s/ E. Joseph Grady Name:   E. Joseph Grady
Title:   Senior Vice President and Chief Financial Officer

[Signatures continued on following page.]

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PURCHASERS

 

ACB HOLDINGS LP

By:   /s/ Adam Blum Name:   Adam Blum Title:   Vice President of ACP Holdings
Management, LLC, General Partner

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AVONDALE GROWTH CAPITAL LP

 

By: KLS GP LLC, General Partner

By:   /s/ Kenneth L. Schnitzer, Jr. Name:   Kenneth L. Schnitzer, Jr. Title:  
Manager

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BABCOCK & WILCOX PENSION TRUST By:   /s/ Stephen C. Wagstaff Name:   Stephen C.
Wagstaff Title:  

Chief Financial Officer

Cannell Capital LLC

Investment Adviser to the

Babcock & Wilcox Pension Trust

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BAMCAP PARTNERS II LP, a Texas limited partnership

 

By: BAMCAP Partners II GP LLC, its General Partner

 

By: Barnes Asset Management LLC, its manager

By:   /s/ Steven Cramer Name:   Steven Cramer Title:   President

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BROOKLINE SPV LLC By:   /s/ J. Rainer Twiford Name:   J. Rainer Twiford Title:  
Authorized Person

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

CLEARVIEW CROWN PARTNERS, L.P. By:   /s/ Michael D. Starcher Name:   Michael D.
Starcher Title:  

Manager, CCP, GP, LLC

General Partner

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

LOUIS BLAUVELT CUSHMAN By:   /s/ Louis Blauvelt Cushman Name:   Louis Blauvelt
Cushman Title:       

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

DWS GROWTH CAPITAL LP

 

By: DS Investments GP LLC, General Partner

By:   /s/ Douglas W. Schnitzer Name:   Douglas W. Schnitzer Title:   Manager

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

GLOBAL UNDERVALUED SECURITIES MASTER FUND, LP By:   /s/ James K. Phillips Name:
  James K. Phillips Title:   Chief Operating Officer

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JAMES MICHAEL NAKFOOR TRUST, DTD 1/1/17 By:   /s/ James M. Nakfoor Name:   James
M. Nakfoor Title:   Beneficiary / Trustee

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

JAMES A. C. KENNEDY, LLC By:   /s/ James A. C. Kennedy Name:   James A. C.
Kennedy Title:       

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

MICHAEL LINDLEY By:   /s/ Michael Lindley Name:   Michael Lindley Title:       

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

LKCM INVESTMENT PARTNERSHIP, L.P. By:   /s/ J. Luther King, Jr. Name:   J.
Luther King, Jr. Title:   President of LKCM Investment Partnership GP, LLC, its
general partner

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LKCM INVESTMENT PARTNERSHIP II, L.P. By:   /s/ J. Luther King, Jr. Name:   J.
Luther King, Jr. Title:   President of LKCM Investment Partnership GP, LLC, its
general partner

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

RICHARD PERRY By:   /s/ Richard Perry Name:   Richard Perry Title:   Private
Investor

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

RED OAK ASSOCIATES, LP By:   /s/ I. Jon Brumley Name:   I. Jon Brumley Title:  
President

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

TONGA PARTNERS, L.P. By:   /s/ Stephen C. Wagstaff Name:   Stephen C. Wagstaff
Title:  

Chief Financial Officer

Cannell Capital LLC

General Partner of Tonga Partners, L.P.

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TRISTAN OFFSHORE FUND, LTD. By:   /s/ Stephen C. Wagstaff Name:   Stephen C.
Wagstaff Title:  

Chief Financial Officer

Cannell Capital LLC

Investment Adviser of Tristan Offshore Fund, Ltd.

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

TRISTAN PARTNERS, L.P. By:   /s/ Stephen C. Wagstaff Name:   Stephen C. Wagstaff
Title:  

Chief Financial Officer

Cannell Capital LLC

General Partner of Tristan Partners, L.P.

 

[Signature Page to Purchase Agreement]

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SCHEDULE A

Schedule of Purchasers

 

Purchaser

  

Notice
Address

   Number of
Shares
of Common Stock      Allocated
Purchase Price  

ACB Holdings LP

  

[Redacted]

     28,655      $ 42,982  

Avondale Growth Capital LP

  

[Redacted]

     5,000,000      $ 7,500,000  

Babcock & Wilcox Pension Trust

  

[Redacted]

     278,773      $ 418,160  

BAMCAP Partners II LP

  

[Redacted]

     666,667      $ 1,000,000  

Brookline SPV LLC

  

[Redacted]

     8,423,333      $ 12,635,000  

Clearview Crown Partners, L.P.

  

[Redacted]

     333,333      $ 500,000  

Cushman, Louis Blauvelt

  

[Redacted]

     66,667      $ 100,000  

DWS Growth Capital LP

  

[Redacted]

     5,000,000      $ 7,500,000  

Global Undervalued Securities Master Fund, LP

  

[Redacted]

     2,000,000      $ 3,000,000  

James Michael Nakfoor Trust, DTD 1/1/17

  

[Redacted]

     200,000      $ 300,000  

Kennedy, James A. C.

  

[Redacted]

     666,667      $ 1,000,000  

Lindley, Michael

  

[Redacted]

     333,333      $ 500,000  

LKCM Investment Partnership, L.P.

  

[Redacted]

     1,920,000      $ 2,880,000  

LKCM Investment Partnership II, L.P.

  

[Redacted]

     80,000      $ 120,000  

Perry, Richard

  

[Redacted]

     66,667      $ 100,000  

Red Oak Associates, LP

  

[Redacted]

     333,333      $ 500,000  

Tonga Partners, L.P.

  

[Redacted]

     328,520      $ 492,780  

Tristan Offshore Fund, Ltd.

  

[Redacted]

     220,640      $ 330,960  

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

Purchaser

  

Notice
Address

   Number of
Shares
of Common Stock      Allocated
Purchase Price  

Tristan Partners, L.P.

  

[Redacted]

     505,400      $ 758,100        

 

 

    

 

 

 

Total

        26,451,988      $ 39,677,982        

 

 

    

 

 

 

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SCHEDULE B

Schedule of Subsidiaries

 

Subsidiary

   Ownership
Percentage

Contango Alta Investments, Inc.

   100%

Contango Operators, Inc.

   100%

Contango Resources, Inc.

   100%

Contango Midstream Company

   100%

Contaro Company

   100%

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EXHIBIT A

FORM OF REGISTRATION RIGHTS AGREEMENT