EX-10.4



 Exhibit 10.4 

Execution Version 

TRANSITION SERVICES AGREEMENT 

This Transition Services Agreement (this “Agreement”) is executed and agreed to as of December 19, 2016 (the
“Effective Date”) by and among WildHorse Resource Development Corporation, a Delaware corporation (the “Parent”), Esquisto Resources II, LLC, a Delaware limited liability company (the
“Company”), and CH4 Energy IV, LLC, a Delaware limited liability company, PetroMax Operating Co., Inc., a Texas corporation, and Crossing Rocks Energy, LLC, a Delaware limited liability company (collectively, the
“Service Providers” and each a “Service Provider”). The Parent, the Company and the Service Providers are hereinafter each referred to as a “Party” and are collectively referred
to as the “Parties”. 
 RECITALS 

WHEREAS, the Service Providers have in place a staff of management, administrative, financial, accounting, marketing, and human resource
personnel capable of providing transition services to the Company; 
 WHEREAS, the Parent and the Company desire to enter into this
Agreement with the Service Providers to obtain certain services necessary to manage the certain operations of the Company’s business, as more fully described herein; and 

WHEREAS, the Service Providers desire to provide the Services (as defined below) to the Company. 

NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows: 
 ARTICLE I. 

DEFINITIONS 
 1.1
Definitions. As used in this Agreement, the following terms shall have the respective meanings set forth below: 

“Agreement” is defined in the preamble. 

“Asset” or “Assets” means all assets and property, real or personal, owned by the Company.

 “Company” is defined in the preamble. 

“Effective Date” is defined in the preamble. 

“Force Majeure Event” means any event not reasonably within the control of the Party claiming the force majeure,
including the following to the extent such events are not reasonably within the control of the Party claiming the force majeure: act of God, act of the public enemy, war, blockade, public riot, lightning, fire, storm, flood or other act of nature,
explosion, governmental action (including changes in Laws, regulations or policies with the effect of Law 







 
or, in each case, the enforcement thereof), and governmental delay or restraint (including with respect to the issuance of permits); provided, however, that a “Force Majeure Event”
shall not include (i) lack of financing or funds and (ii) to the extent affecting only such Party’s or such Party’s affiliate’s employees, any strike, work stoppage or other organized labor difficulty. 

“Governmental Authority” means any federal, state, local, municipal, tribal or other government; any governmental,
regulatory or administrative agency, commission, body or other authority exercising or entitled to exercise any administrative, executive, judicial, legislative, regulatory or taxing authority or power; and any court or governmental tribunal having
or asserting jurisdiction. 
 “Law” means any applicable constitutional provision, statute, act, code, law,
regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision, declaration or interpretative or advisory opinion or letter of a Governmental Authority. 

“Management Fee” is defined in Section 3.1. 

“Outsourced Service” is defined in Section 2.1. 

“Parent” is defined in the preamble. 

“Party” and “Parties” are defined in the preamble. 

“Person” means a natural person, partnership (whether general or limited), limited liability company, Governmental
Authority, trust, estate, association, corporation, venture, custodian, nominee or any other individual or entity in its own or any representative capacity. 

“Prudent Industry Practice” means, at a particular time, any of the practices, methods, standards of care, skill,
safety and diligence, as the same may change from time to time, but applied in light of the facts known at the time, that are consistent with the general standards applied or utilized under comparable circumstances by a reasonably prudent operator,
in a good and workmanlike manner, with due diligence and dispatch, in accordance with good industry practice. Service Providers have been and are currently providing services to the Company with regard to the Assets and for the purpose of this
agreement the Service Providers’ past practices shall be deemed Prudent Industry Practice. 
 “Service
Providers” is defined in the preamble. 
 “Services” is defined in Section 2.1. 

“Term” is defined in Section 4.1. 

“Third Party” means a Person other than a Party. 

  
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 ARTICLE II. 

SERVICES 
 2.1
Services. The Service Providers shall provide the Company with the services necessary to manage the day to day operations of the Company, including engineering, land, operating, financial and other similar services necessary and sufficient or
appropriate to conduct the affairs of the Company (the “Services”). The Services shall include, but are not limited to, the services set forth on Schedule 2.1 hereto. Such Services shall be provided by the Service
Providers solely for the benefit of the Parent and the Company. The Service Providers may cause one or more Third Party contractors, subject to the prior approval of the Company, to provide any of the Services (any such Services provided by Third
Party contractors being referred to herein as an “Outsourced Service”); provided, however, that except as expressly provided in this Agreement, any Outsourced Services shall be subject to the provisions of this
Agreement in the same way as any Service that is not an Outsourced Service is subject to the provisions of this Agreement. 
 2.2 Records
and Auditing Rights. Each Service Provider shall at all times maintain adequate books and records to verify the accounts and transactions under this Agreement. Such records shall be retained and kept available for inspection and audit by the
Parent and the Company, and other representatives of the Parent and the Company on days such Service Provider is open for business during normal working hours upon reasonable notice to such Service Provider. 

2.3 Standard of Care. Each Service Provider hereby warrants that it will perform all of its obligations under this Agreement in
accordance with Prudent Industry Practices and in compliance with all applicable Laws. 
 2.4 Duty to the Company. Each Service
Provider shall dedicate sufficient personnel and resources to provide the Services in accordance with Prudent Industry Practices. 
 2.5
Conditions of Service. 
 (a) Subject to Sections 2.3 and 2.4, the Service Providers shall have complete
authority and discretion to elect the means, manner and method of performing the Services. 
 (b) All Third Party contractors
that provide Outsourced Services shall be selected by the Service Providers with reasonable care and with reasonable assurances that such Third Party contractors can perform the Services pursuant to the requirements of this Agreement. 

(c) The Service Providers shall perform the Services as an “independent contractor” of the Company and nothing in
this Agreement is intended, and nothing shall be construed, to create an agency, employer/employee, partnership, joint venture, association or other similar relationship between the Service Providers and the Company. 

  
 3 








 (d) This Agreement is a purely commercial transaction between the Parties and
nothing stated in this Agreement shall operate to create any special or fiduciary duty between the Parties. 
 (e)
Notwithstanding anything to the contrary, all matters pertaining to the employment, supervision, compensation, promotion and discharge of any personnel of each Service Provider are the responsibility of such Service Provider. All such employment
arrangements are solely each Service Provider’s obligation, and the Company shall have no liability with respect thereto or with respect to the employment arrangements of any other Service Provider. 

ARTICLE III. 
 PAYMENTS

 3.1 Management Fee. As sole consideration for the Services rendered by the Service Providers to the Company under this
Agreement, the Company shall pay the Service Providers an aggregate management fee of $10.00 per month during the Term (the “Management Fee”). The Company will pay the Management Fee no later than the 20th day of the month
following the calendar month in which services are provided. The Management Fee is intended to reimburse the Service Providers for expenses for the Services that are general and administrative charges as accounted for under standard accounting
methods. The Management Fee shall also be deemed to include reimbursement for geoscience expenses. Direct third party expenses incurred by the Service Providers in connection with Services that are not general and administrative expenses or
geoscience expenses, including lifting and operating expenses, capital expenditures and lease acquisitions costs, will be reimbursed to the Service Providers on a monthly basis; provided, however, the Service Providers shall provide
documentation for any such third party expenses prior to any reimbursement by the Company. 
 3.2 Call for Company Advances. On an as
needed basis, each Service Provider may request the Company advance funds to such Service Provider to cover all out-of-pocket third-party costs and expenses to be incurred by such Service Provider at the request of, and for the benefit of, the
Company, including, without limitation, the direct operating expenses of the Company and any cost or expense relating to a capital project of the Company. Any requests for advances hereunder shall be accompanied by appropriate documentation from
such Service Provider supporting such costs and expenses. Upon the Company’s approval, the Company shall advance such funds within ten business days following such request from such Service Provider, subject to extension to the extent necessary
to provide any additional documentation reasonably requested of such Service Provider by the Parent or the Company. Such Service Provider, the Parent and the Company shall determine, no less frequently than on a monthly basis, whether excess cash
advances may be returned to the Company; provided, that any unused advances shall be returned to the Company at the end of the Term. 

ARTICLE IV. 
 TERM;
TERMINATION 
 4.1 Term. This Agreement will commence on the Effective Date and will remain in effect until 180 days following
the Effective Date; provided, that this Agreement may be terminated at any time by the Company, by delivering written notice to the Service Providers (such period of time during which this Agreement is in effect, the “Term”).


  
 4 








 4.2 Transition Services. During (i) the last 30 days of the Term or (ii) the
period of time commencing on the date a termination notice is provided by the Company pursuant to Section 4.1 until the effective date of such termination, the Service Providers shall in good faith assist and cooperate with the Parent
and the Company to facilitate the transfer of the Services to any Person designated by the Parent and the Company; provided, that, during such period, the Company shall pay to the Service Providers any amounts payable by the Company to the
Service Providers pursuant to this Agreement. 
 ARTICLE V. 

DUTIES AND RESPONSIBILITIES 

5.1 Duties and Responsibilities. Each Service Provider shall comply in all respects with the terms of this Agreement and shall use its
reasonable commercial efforts, in the conduct of business and operations of the Company, (i) to comply, in all material respects, with the terms and provisions of all agreements relating to the Company’s business, operations or properties
to which it is a party or to which the Company’s properties are subject and (ii) to comply, in all material respects, with all applicable Laws, ordinances or governmental rules and regulations to which the Company is subject (including,
without limitation, all applicable federal, state and local environmental Laws, ordinances, rules and regulations). 
 5.2 Personnel.
Each Service Provider covenants and agrees that it will at all times retain and have available to it and the Company a professional staff and outside consultants that together will be reasonably adequate in size, experience and competency to
discharge properly the duties and functions of such Service Provider and the Company hereunder and under any applicable operating and other agreements, including, but not limited to, technical personnel, attorneys, accountants and secretarial and
clerical personnel. 
 5.3 Utilized Property. In connection with providing the Services, each Service Providers shall utilize certain
personal property and other assets of such Service Provider (the “Utilized Property”). Ownership of the Utilized Property shall remain with such Service Provider notwithstanding that the Utilized Property may be used
primarily for the benefit of the Company. The Utilized Property include, but are not limited to, (i) all rights of such Service Provider in respect of the lease of office space for its principal office, (ii) all tangible personal property
owned by such Service Provider, including corporate office build-out, computers, office furniture, computer hardware and software and corporate pool cars, (iii) utilities, telecommunications, office supplies and mailing expenses,
(iv) professional services that benefit the Company, and (v) insurance premiums for the corporate office and corporate shared pool vehicles, including D&O insurance premiums, as applicable. Such Service Provider shall be responsible
for maintaining all Utilized Property in good condition and repair, reasonable wear and tear excepted, and may refurbish or replace, at such Service Provider’s expense, such items as they become worn out or obsolete. If any Service Provider
uses or licenses intellectual property owned by Third Parties in the performance of Services under this Agreement, such Service Provider shall obtain and maintain any such licenses and authorizations necessary to authorize its use of such
intellectual property in connection with such Services. 

  
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 ARTICLE VI. 

LIMITED WARRANTY; LIMITATION ON LIABILITY; INSURANCE; AND 

INDEMNIFICATION 
 6.1
Limited Warranty; Warranties Disclaimer. THE WARRANTY CONTAINED IN THIS SECTION 6.1 SHALL BE EXCLUSIVE, AND IS GIVEN AND ACCEPTED IN LIEU OF ANY EXPRESS OR IMPLIED WARRANTIES, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. WITH RESPECT TO ANY DEFECT IN THE SERVICES RENDERED OR PRODUCTS OBTAINED FOR THE COMPANY (WHETHER A CLAIM FOR SUCH DEFECT ARISES UNDER CONTRACT, TORT, STRICT LIABILITY, STATUTE, OR ANY OTHER LEGAL OR EQUITABLE THEORY OR PRINCIPLE
INCLUDING NEGLIGENCE), EACH SERVICE PROVIDER’S SOLE LIABILITY AND RESPONSIBILITY AND THE COMPANY’S SOLE REMEDY SHALL BE THE REPERFORMANCE OF THE SERVICES IN ACCORDANCE WITH THIS AGREEMENT, UNLESS THE DEFECT WAS CAUSED BY THE FRAUD, GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH SERVICE PROVIDER. 
 6.2 Limitation on Liability. It is expressly understood by each Service
Provider and the Company that no Service Provider shall have liability for the failure of Third Party providers to perform any Outsourced Services hereunder and further that no Service Provider shall have liability whatsoever for the Services
provided by any such Third Party unless in either event such Outsourced Services are provided in a manner that would evidence gross negligence or intentional misconduct on the part of such Service Provider but the Service Provider shall, on behalf
of the Company, pursue all rights and remedies under any such Third Party contract. It is further understood by each Service Provider and the Company that no Service Provider shall have liability for the Services provided by any other Service
Provider and that any liabilities for the Service Providers under this Agreement shall be several and not joint. The Parent and the Company agree that the remuneration paid to the Service Providers hereunder for the Services to be performed reflect
this limitation of liability and disclaimer of warranties. In no event shall the any Service Provider be liable to the Parent and the Company or any other Person for any indirect, special or consequential damages resulting from any error in the
performance of Services or from the breach of this Agreement, regardless of the fault of such Service Provider, or any Third Party provider or whether such Service Provider, or the Third Party provider, is wholly, concurrently, partially or solely
negligent. To the extent any Third Party provider has limited its liability to any Service Provider for Outsourced Services under an agreement, the Company agrees to be bound by such limitation of liability for any product or Outsourced Service
provided to the Company by such Third Party provider under such Service Provider’s agreement. 
 6.3 Insurance. Each Service
Provider agrees to the terms and its obligations set forth on Schedule 6.3 with respect to insurance. 
 6.4 Indemnification.
Each Service Providers, severally and not jointly, shall defend, indemnify and hold Parent and Company harmless from and against any and all claims that the Parties may suffer due to such Service Provider’s failure to comply with all of the
insurance requirements in this Agreement. In no event shall the amount or scope of the insurance required herein place any limitation on the liability assumed by such Service Provider elsewhere in this


  
 6 








 
Agreement. Each Service Provider, severally and not jointly, hereby agrees to release, protect, defend, indemnify and hold the Company and Parent harmless from and against any and all claims
arising out of bodily injury to persons, including, but not limited to, sickness or death, in any manner caused by, directly or indirectly resulting from, incident to, connected with or arising out of, performance of the Services, WHETHER OR NOT
RESULTING IN WHOLE OR IN PART FROM THE SOLE, CONCURRENT OR COMPARATIVE NEGLIGENCE (EXCEPT TO THE EXTENT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE COMPANY OR PARENT) OR STRICT LIABILITY OF THE COMPANY OR PARENT, OR ANY DEFECT IN THE
PREMISES, EQUIPMENT OR TOOLS OWNED, OPERATED OR CONTROLLED BY THE COMPANY OR PARENT. Company hereby agrees to release, protect, defend, indemnify and hold each Service Provider harmless from and against any and all claims arising out of bodily
injury to persons employed by Company, including, but not limited to, sickness or death, in any manner caused by, directly or indirectly resulting from, incident to, connected with or arising out of, performance of the Services up to the amount of
such limits on such Service Provider’s indemnification obligations set forth in the immediately preceding sentence, WHETHER OR NOT RESULTING IN WHOLE OR IN PART FROM THE SOLE, CONCURRENT OR COMPARATIVE NEGLIGENCE (EXCEPT TO THE EXTENT OF THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH SERVICE PROVIDER) OR STRICT LIABILITY OF SERVICE PROVIDER, OR ANY DEFECT IN THE PREMISES, EQUIPMENT OR TOOLS OWNED, OPERATED OR CONTROLLED BY SUCH SERVICE PROVIDER. The indemnification obligations of
the Parties under this Article 6 shall expressly survive the termination of this Agreement. 
 ARTICLE VII. 

FORCE MAJEURE 
 7.1
Excused Performance. A Party shall not be responsible or liable for or deemed in breach of this Agreement for any delay or failure in the performance of its obligations under this Agreement to the extent such performance is prevented by a
Force Majeure Event; provided that: 
 (a) the affected Party gives the other Party prompt notice describing the
particulars of the Force Majeure Event and the proposed cure; 
 (b) the suspension of performance is of no greater scope and
of no longer duration than is reasonably attributable to the Force Majeure Event; 
 (c) the affected Party uses commercially
reasonable efforts to remedy its inability to perform its obligations under this Agreement or the Force Majeure Event; and 

(d) when the affected Party is able to resume performance of its obligations under this Agreement, that Party shall give the
other Party written notice to that effect. 
 7.2 No Preclusion. The existence of a Force Majeure Event shall not relieve any Party of
(a) any of its payment obligations under this Agreement, or (b) any other obligation under this Agreement to the extent that performance of such other obligation is not precluded by such Force Majeure Event. 

  
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 7.3 Limitations on Effect of Force Majeure. In no event will any delay or failure of
performance caused by a Force Majeure Event extend this Agreement beyond its Term. 
 ARTICLE VIII. 

REPRESENTATIONS AND WARRANTIES 

8.1 Company Representations. The Parent and the Company represent and warrant as of the Effective Date that: 

(a) the Parent is a corporation incorporated and validly existing under the Laws of the State of Delaware and the Company is a
limited liability company duly organized and validly existing under the Laws of the State of Delaware, as applicable, and each has all necessary authorizations required by applicable Law to perform its obligations under this Agreement; 

(b) the execution, delivery and performance of this Agreement by the Parent and the Company has been duly authorized by all
requisite corporate or limited liability company action, as applicable, and will not: (i) violate any provisions of its organizational documents or (ii) result in the breach or acceleration of any performance required by the terms of any
contract, agreement or arrangement to which it is a party or any applicable Laws; and 
 (c) this Agreement is a valid and
binding obligation of the Parent and the Company, enforceable against the Parent and the Company in accordance with its terms, subject to the effects of bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors’
rights generally and by general equitable principles, regardless of whether the issue of enforceability is considered in a proceeding in equity or at law. 

8.2 Service Provider Representations. Each Service Provider represents and warrants as of the Effective Date that: 

(a) such Service Provider is a corporation or limited liability company, as applicable, duly organized and validly existing
under the Laws of the State of Delaware or Texas, as applicable, and has all necessary authorizations required by applicable Law to perform its obligations under this Agreement; 

(b) the execution, delivery and performance of this Agreement by such Service Provider have been duly authorized by all
requisite corporate or limited liability company action, as applicable, and will not: (i) violate any provisions of its organizational documents or (ii) result in the breach or acceleration of any performance required by the terms of any
contract, agreement or arrangement to which it is a party, or any applicable Laws; and 
 (c) this Agreement is a valid and
binding obligation of such Service Provider, enforceable against such Service Provider in accordance with its terms, subject to the effects of bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors’ rights
generally and by general equitable principles, regardless of whether the issue of enforceability is considered in a proceeding in equity or at law. 

  
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 ARTICLE IX. 

MISCELLANEOUS 
 9.1
Counterparts. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any
signature hereto delivered by a Party by facsimile transmission shall be deemed an original signature hereto. 
 9.2 Notices. 

(a) Except as expressly set forth to the contrary in this Agreement, all notices and communications required or permitted to be
given hereunder shall be sufficient in all respects if given in writing and delivered personally, or sent by overnight courier, or mailed by U.S. Express Mail or by certified or registered United States Mail with all postage fully prepaid, or sent
by facsimile transmission (provided any such facsimile transmission is confirmed either orally or by written confirmation) or sent by email, addressed to the appropriate Party at the address or email address for such Party shown below or at such
other address as such Party shall have theretofore designated by written notice delivered to the Party giving such notice: 
 If to the
Parent: 
 WildHorse Resource Development Corporation 

9805 Katy Freeway, Suite 400 

Houston, Texas 77024 
 Attn:
General Counsel 
 Facsimile: (713) 568-4911 

If to the Company: 
 Esquisto
Resources II, LLC 
 c/o WildHorse Resource Development Corporation 

9805 Katy Freeway, Suite 400 

Houston, Texas 77024 
 Attn:
General Counsel 
 Facsimile: (713) 568-4911 

If to the Service Providers: 

 


	
	 Crossing Rocks Energy, LLC

	 301 Commerce St, Suite 2001

	 Fort Worth, Texas 76102

	 Attn: Scott Lakey

	 Facsimile: (817)796-1155

	
	 PetroMax Operating Co., Inc.

	 603 Main Street, Ste 201

	 Garland, TX 75040

	 Attn: Will Shaw

	 Facsimile: 972-271-2533






	
	 CH4 Energy IV, LLC

	
421 W. 3rd Street, Suite 
750

	 Fort Worth, Texas 76102

	Attn: Richard Brannon
	Facsimile: (817) 924-8697

 
 


  
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 (b) Any notice given in accordance herewith shall be deemed to have been given
when delivered to the addressee by email, or in person, or by courier, or transmitted by facsimile transmission during normal business hours, or upon actual receipt by the addressee after such notice has either been delivered to an overnight courier
or deposited in the United States Mail, as the case may be. The Parties may change the address, telephone numbers, and facsimile numbers to which such communications are to be addressed by giving written notice to the other Parties in the manner
provided in this Section 9.2. 
 9.3 Entire Agreement; Conflicts. This Agreement and the Schedules hereto collectively
constitute the entire agreement among the Parties pertaining to the subject matter hereof and supersede all prior agreements, understandings, negotiations and discussions, whether oral or written, of the Parties pertaining to the subject matter
hereof. In the event of a conflict between the terms and provisions of this Agreement and the terms and provisions of any Schedule hereto, the terms and provisions of this Agreement shall govern and control; provided, however, that the inclusion in
any of the Schedules hereto of terms and provisions not addressed in this Agreement shall not be deemed a conflict, and all such additional provisions shall be given full force and effect, subject to the provisions of this Section 9.3.

 9.4 Amendment. This Agreement may be amended only by an instrument in writing executed by all of the Parties and expressly
identified as an amendment or modification. 
 9.5 Parties in Interest. Nothing in this Agreement shall entitle any Person other than
the Parties to any claim, cause of action, remedy or right of any kind. 
 9.6 Successors and Permitted Assigns. This Agreement shall
be binding upon and inure to the benefit of the Parties and their successors and permitted assigns. 
 9.7 Assignment. Except for the
ability of a Service Provider to cause one or more of the Services to be performed by a Third Party provider (subject to the terms of this Agreement), no Party shall have the right to assign its rights or obligations under this Agreement without the
prior written consent of the other party and any such assignment that is made without such consent shall be void and of no force and effect. No permitted assignment shall release any Party from any of its obligations under this Agreement. All of the
terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the Parties hereto and their respective successors and permitted assignees. 

9.8 Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Party shall execute and
deliver all such future instruments and take such other and further action as may be reasonably necessary or appropriate to carry out the provisions of this Agreement and the intention of the Parties as expressed herein. 

  
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 9.9 Severability. If any term or other provision of this Agreement is invalid, illegal, or
incapable of being enforced by any rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any adverse manner to any Party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible. 

9.10 No Recourse. For the avoidance of doubt, the provisions of this Agreement shall not give rise to any right of recourse against any
current or former stockholder, member, partner, owner, director, manager, officer or employee of any Service Provider or of the Parent or the Company or any of their respective officers, directors, employees, agents, representatives or affiliated
companies. 
 9.11 Governing Law. THIS AGREEMENT IS TO BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE
STATE OF TEXAS. 
 9.12 Interpretation. All references in this Agreement to Schedules, Articles, Sections, subsections and other
subdivisions refer to the corresponding Schedules, Articles, Sections, subsections and other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any Articles, Sections, subsections and other
subdivisions of this Agreement are for convenience only, do not constitute any part of this Agreement, and shall be disregarded in construing the language hereof. The words “this Agreement,” “herein,” “hereby,”
“hereunder” and “hereof,” and words of similar import, refer to this Agreement as a whole and not to any particular Article, Section, subsection or other subdivision unless expressly so limited. The words “this
Article,” “this Section” and “this subsection,” and words of similar import, refer only to the Article, Section or subsection hereof in which such words occur. The word “including” (in its various forms) means
including without limitation. All references to “$” or “dollars” shall be deemed references to United States dollars. Each accounting term not defined herein will have the meaning given to it under GAAP as interpreted as of the
date of this Agreement. Pronouns in masculine, feminine or neuter genders shall be construed to state and include any other gender, and words, terms and titles (including terms defined herein) in the singular form shall be construed to include the
plural and vice versa, unless the context otherwise requires. Schedules referred to herein are attached to and by this reference incorporated herein for all purposes. References to any Law or agreement shall mean such Law or agreement as it may be
amended from time to time. 
 [Signature Page Follows] 

  
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 IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly
authorized representatives as of the date and year first above written. 
  

			
	PARENT:
	
	WILDHORSE RESOURCE DEVELOPMENT CORPORATION
		
	By:	 	 /s/ Jay C. Graham

	Name:	 	Jay C. Graham
	Title:	 	CEO
	
	COMPANY:
	
	ESQUISTO RESOURCES II, LLC
		
	By:	 	 /s/ Jay C. Graham

	Name:	 	Jay C. Graham
	Title:	 	CEO


 SIGNATURE PAGE 

TRANSITION SERVICES AGREEMENT 







 
			
	
	SERVICE PROVIDERS:
	
	CH4 ENERGY IV, LLC
		
	By:	 	 /s/ Richard D. Brannon

	Name:	 	Richard D. Brannon
	Title:	 	President
	
	PETROMAX OPERATING CO., INC.
		
	By:	 	 /s/ Mike Hoover

	Name:	 	Mike Hoover
	Title:	 	President
	
	CROSSING ROCKS ENERGY, LLC
		
	By:	 	 /s/ Bruce Selkirk

	Name:	 	Bruce Selkirk
	Title:	 	President and CEO


 SIGNATURE PAGE 

TRANSITION SERVICES AGREEMENT 







 Schedule 2.1 

Services 
 The Services
shall include any services necessary or appropriate for the management and operation of the Company and may include, without limitation, employee services related to supporting the following: 

 

	 	1.	Administrative and Land Services (as described below) 

  

	 	2.	Operator Services (as described below) 

  

	 	3.	Financial and Accounting Services, including KPMG and or EY audit support 

  

	 	4.	Accounts Payable and Receivables 

  

	 	5.	Land and Land Administration 

  

	 	6.	Strategic Planning and Budgeting Cooperation with the Company and the Parent 

  

	 	7.	Any Other Services as Reasonably Requested by the Parent or the Company from Time to Time 


Administrative and Land Services: To fulfill its obligation to manage the day-to-day affairs of the Company, each Service
Provider: 
 (i) may, in the name of such Service Provider or the Company or as agent for the Company, as appropriate,
negotiate, enter into or settle contracts and agreements which are necessary to prudently manage the Assets of the Company in accordance with the terms of this Agreement. Such contracts and agreements may include, but are not limited to, furnishment
of utilities to Assets of the Company, gathering or processing agreements and contract services agreements. Company will, when necessary, appoint such Service Provider as its agent to act on Company’s behalf; 

(ii) as directed by the Parent, will cause the Company to retain qualified accountants and legal counsel, as applicable, to
assist in developing appropriate accounting procedures, compliance procedures and testing systems with respect to financial reporting obligations and to conduct compliance reviews with respect thereto; 

(iii) will use commercially reasonable efforts to cause third-party expenses incurred by or on behalf of the Company to be
commercially reasonable or commercially customary and within any budgeted parameters or expense guidelines set by the Company from time to time; provided, however, any expenditures that will exceed the applicable budgeted parameter by more than 10%
shall require the Company’s prior approval; 







 (iv) will correspond with Company’s partners and generally conduct industry
standard lease administration duties on Company’s Assets; 
 (v) will perform such other services as may be required
from time to time for management and other activities relating to the Assets of the Company as the Company shall reasonably request or such Service Provider shall deem appropriate under the particular circumstances and approved by the Company; and

 (vi) will perform other land functions as such Service Provider and the Company may deem necessary to manage the
Company’s Assets. 
 Operator Services: Each Service Provider shall perform such services as are typically provided by an
operator for non-operators for each of the Operator Services with respect to the Assets for which the Company would otherwise serve as an operator, and to perform those Operator Services required for the non-operated Assets owned by the Company.
“Operator Services” is defined as disbursing actual received revenues to revenue interest owners on such Service Provider’s normal monthly revenue distribution schedule; 

Financial and Accounting Services: To fulfill its obligation to manage certain of the operations of the Company, each Service
Provider: 
 (i) will enter and maintain the revenue and expense decks of the Company’s Assets in such Service
Provider’s land and accounting systems; and 
 (ii) will provide access to historical Company data for financial
statement audits requested by the Parent and will perform, cause to be performed and cooperate with the Parent with respect to any other accounting, financial or audit related services as the Parent or Company may reasonably request. 







 Schedule 6.3 

Insurance 
  

	1)	Throughout the term of this Agreement, each Service Provider shall adequately secure and maintain, with reliable insurers with an A.M. Best rating of no less than A-VII and with adequate terms, conditions and limits,
insurance including: 

  

	 	a)	Commercial General Liability insurance; 

  

	 	b)	Automobile Liability Insurance for all owned, leased and non-owned vehicles; 

  

	 	c)	follow-form Excess/Umbrella Liability insurance (minimum $5 million limit); 

  

	 	d)	Workers’ Compensation (statutory limits); and 

  

	 	e)	Employers Liability (minimum $1 million limit). 

  

	2)	Commercial General Liability Insurance, Automobile Liability and Excess/Umbrella Liability shall not contain any cross liability exclusion, shall name Parent and Company as an additional insured and shall waive rights
of subrogation in favor of Parent and Company. The Workers’ Compensation policy shall waive its rights of subrogation in favor of Parent and Company and include an Alternate Employer endorsement, if applicable. The Commercial General Liability
policy shall not contain any provision, definition or endorsement that would serve to eliminate third party action over claims coverage and shall include coverage for contractual liability and products/completed operations. 


 

	3)	All insurance coverage carried by a Service Provider with respect to the risks and liabilities assumed by such Service Provider hereunder shall extend to and protect the Parent and Company to the full extent and amount
of such coverage, and shall be primary to, and receive no contribution from, any other insurance or self-insurance programs maintained by or on behalf of or benefiting the Parent or Company. 


 

	4)	Each Service Provider shall provider Company or Parent a Certificates of Insurance, along with applicable Endorsements, evidencing required current insurance as set forth in this Agreement. 


 

	5)	If a Third Party contractor or service provider is utilized to perform any Services under this Agreement, the applicable Service Provider shall require that such Third Party contractor or service provider maintain
insurance including limits, coverages, terms, and conditions applicable for the Services performed. As applicable, such Third Party contractor or service provider shall name Parent and Company as an Additional Insured and waive subrogation rights in
favor or Parent and Company.