exhibit10-2.htm


     

    Exhibit
10.2

     

     

    LEASE
AMENDMENT AND

    LEASE
ROYALTY CONVEYANCE AGREEMENT

    


    This
LEASE AMENDMENT AND LEASE ROYALTY CONVEYANCE AGREEMENT (“Agreement”) is made
and entered into by and between Ben J. Fortson also
known as Benjamin J. Fortson,
trustee of the Mattie K. Carter Trust, and Ben J. Fortson, individually, Benco
Energy, Inc., Katherine Fortson Wynne, Karen Fortson Davis, and Lisa Fortson
Burton, each dealing in their separate property, Hannah E. Davis 2006 Trust,
David Paul Davis 2006 Trust a/k/a David P. Davis 2006 Trust, Katherine Rose
Davis 2006 Trust a/k/a Katherine R. Davis 2006 Trust, Wynne Children’s
Irrevocable Asset Trust f/b/o John R. Wynne II a/k/a Wynne Children’s
Irrevocable Asset Trust f/b/o John Robert Wynne II, Wynne Children’s Irrevocable
Asset Trust f/b/o Lisa Katherine Wynne a/k/a Wynne Children’s Irrevocable Asset
Trust f/b/o Lisa Wynne Trust, Wynne Children’s Irrevocable Asset Trust f/b/o
David Mitchell Wynne a/k/a Wynne Children’s Irrevocable Asset Trust f/b/o David
Mitchell Wynne Trust, and Burton Family Children’s
Trust (collectively the “Fortson Parties”),
and Vanguard Permian,
LLC (“Vanguard”).

    


    WHEREAS, Ben J. Fortson also known as
Benjamin J. Fortson, Trustee of the Mattie K. Carter Trust, and Ben J. Fortson,
individually,
Benco Energy, Inc., Katherine Fortson Wynne, Karen Fortson Davis, and
Lisa Fortson Burton, each dealing in their separate property, (the “Fortson Lessors”),
are current lessors under those certain oil and gas leases described on Exhibit “A” hereto
(the “Leases”);

    


    WHEREAS, Ben J. Fortson also known as
Benjamin J. Fortson, Trustee of the Mattie K. Carter
Trust, and Ben J. Fortson, individually, Benco Energy, Inc.,
Katherine Fortson Wynne, Karen Fortson Davis, and Lisa Fortson Burton, each
dealing in their separate property, Hannah E. Davis 2006 Trust, David Paul Davis
2006 Trust a/k/a David P. Davis 2006 Trust, Katherine Rose Davis 2006 Trust
a/k/a Katherine R. Davis 2006 Trust, Wynne Children’s Irrevocable Asset Trust
f/b/o John R. Wynne II a/k/a Wynne Children’s Irrevocable Asset Trust f/b/o John
Robert Wynne II, Wynne Children’s Irrevocable Asset Trust f/b/o Lisa Katherine
Wynne a/k/a Wynne Children’s Irrevocable Asset Trust f/b/o Lisa Wynne Trust,
Wynne Children’s Irrevocable Asset Trust f/b/o David Mitchell Wynne a/k/a Wynne
Children’s Irrevocable Asset Trust f/b/o David Mitchell Wynne Trust, and Burton
Family Children’s Trust (collectively the “Royalty Owners”) are
the current lessors and/or owners of the lessor’s royalties under the three oil
and gas leases described on Exhibit “B” hereto (the “Fortson 47
Leases”);

    


    WHEREAS, Vanguard has entered into a
Purchase and Sale Agreement (the “PSA”) of even date
herewith, in order to acquire working interests in the Leases and the Fortson 47
Leases and this Agreement constitutes the “letter agreement” described in
Section 9.2 and 9.3 of the PSA;

    


    WHEREAS, contingent upon, and
immediately after, the transfer of the working interest in the Leases to
Vanguard at the closing pursuant to the PSA (the “Closing”), Vanguard
and the Fortson Lessors have agreed to enter into one or more amendments of the
Leases, in the form attached hereto as Exhibit “C” (the
“Lease
Amendments”), in order to accomplish a reduction in the lessor’s royalty
burden in each of the Leases from one-quarter (1/4) to three-sixteenths
(3/16);

    


    WHEREAS, contingent upon, and
immediately after, the Closing, the Royalty Owners have agreed to execute and
deliver the conveyance of royalty interests, in the form attached hereto as
Exhibit “D”
(the “Royalty
Deed”), conveying to Vanguard one-quarter (1/4) of the royalties the
Royalty Owners are currently entitled to under the Fortson 47
Leases.

    
 

    NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged and
confessed, the Fortson Parties and Vanguard agree as follows:

    


    1.           Execution and Delivery of
the Lease Amendments.  At the Closing, immediately following
the transfer of the working interest in the Leases and the Fortson 47 Leases to
be transferred pursuant to the PSA, the Fortson Lessors shall execute and
deliver to Vanguard the Lease Amendments.  Vanguard shall promptly
record the Lease Amendments in the appropriate deed records, and thereafter
deliver to the Fortson Lessors a recorded copy of the Lease
Amendments.

    


    2.           Execution and Delivery of
the Royalty Deed.  At the Closing, immediately following the
transfer of the working interest in the Leases and the Fortson 47 Leases to be
transferred pursuant to the PSA, the Royalty Owners shall execute and deliver to
Vanguard the Royalty Deed in order to accomplish a reduction in the lessor’s
royalty burden (as to the Royalty Owners’ interest) in each of the Fortson 47
Leases from one-quarter (1/4) to three-sixteenths (3/16).  Vanguard
shall promptly record the Royalty Deed in the appropriate deed records and
notify Cimarex Energy Co. of the transfer, and thereafter deliver to the Royalty
Owners a recorded copy of the Royalty Deed.

    


    3.           Payment.  As
consideration for execution and delivery of the Lease Amendments and the Royalty
Deed, Vanguard will pay to the Fortson Parties, at Closing, the sum of Five
Million Six Hundred Sixty Eight Thousand Fifty Nine Dollars and No Cents ($5,668,059.00) by wire transfer
of immediately available funds into an account to be designated by the Fortson
Parties.

    


    4.           Agreements and
Acknowledgements by Royalty Owners.  The Royalty Owners
acknowledge and agree with Vanguard as follows:

    


    
      	
              a)  

            	
              All
      notices to Royalty Owners and/or information to be provided to Royalty
      Owners which are required or may be given under any Fortson 47 Lease may
      be made jointly to the Royalty Owners at the following
      address:

            


    

    


    Fortson
Production Company

    301
Commerce St., Suite 2900

    Fort
Worth, Texas 76102

    Attn:           David
Frazier

    Telephone:                      (817)
335-5641

    Telecopy:                      (817)
336-4853

    


    
      	
              b)  

            	
              The
      Royalty Owners hereby waive any claims against Vanguard (but no other
      working interest owners in the Fortson 47 Leases) for: (i) lack of consent
      to the execution of any currently in place production sales contracts,
      marketing contracts and other contracts applicable to the sale of oil or
      the sale of gas produced from the lands covered by the applicable Fortson
      47 Lease; or (ii) any claim asserting that the methodology for the
      calculation of prices under such existing contracts does not reflect the
      “market value” for purposes of the calculation of royalties under the
      applicable Fortson 47 Lease.

            


    

    


    


    


    
      	
              c)  

            	
              The
      Royalty Owners hereby waive any claims against Vanguard (but no other
      working interest owner in the Fortson 47 Leases) arising prior to the
      Effective Date of this Agreement, asserting that royalties under any of
      the Fortson 47 Leases have been improperly charged with deduction or cost
      of gathering, transporting, separating, dehydrating, compressing or
      otherwise in making the oil or gas ready for sale or use as prohibited by
      the Fortson 47 Leases.

            


    

    


    
      	
              d)  

            	
              Any
      forfeiture described in each Fortson 47 Lease shall apply with respect to
      the well for which the applicable sum has not been paid, and a portion of
      the leased premises sufficient (a) to include the entire wellbore, (b) to
      permit such well to produce with a full allowable, and (c) to make the
      location of its entire wellbore in compliance with all applicable well
      spacing and density rules of the Railroad Commission of Texas; such
      portion of the leased premises shall be designated by the Royalty Owners
      in their reasonable discretion.

            


    

    


    
      	
              e)  

            	
              Each
      Fortson 47 Lease is in full force and effect, and the Royalty Owners
      ratify each Fortson 47 Lease as to all of its terms including those
      contained herein, and agree that no default or breach has occurred under
      any Fortson 47 Lease.

            


    

    


    5.           Further
Assurances.  The Fortson Parties and Vanguard agree to execute
and deliver such other and further instruments, documents and assurances as
either of them may reasonably request of the other to effectuate the purpose and
intent of this agreement.

    


    6.           Ad-Valorem Tax
Issues.  Ad valorem real property and personal property taxes
and assessments related to the interest conveyed in the Royalty Deed, and the
reduced lessor’s royalty burden accomplished by the Lease Amendments, shall all
be prorated as of October 1, 2009.  All such prorations shall be
allocated so that those items relating to time periods ending on or prior
to October 1, 2009 shall be allocated to the Fortson Lessors in the case of the
Lease Amendments, and to the Royalty Owners in the case of the Royalty Deed, and
items relating to time periods beginning after October 1, 2009 shall be
allocated to Vanguard.  The amount of all such prorations shall be
finally settled and paid at Closing based upon the most recent available tax
bill, tax notice or notification of appraised value.

    


    7.           Entire
Agreement. This Agreement
(including the exhibits hereto) contains the entire agreement between the
parties, and no oral statements or prior written matter not specifically
incorporated herein shall be of any force and effect.  No variation,
modification, or changes hereof shall be binding on either party hereto unless
set forth in a document executed by all parties hereto.

    


    8.           Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas without giving effect to any
choice of law or conflict of law provision or rule that would cause the
application of the laws of any jurisdiction other than the State of
Texas.

    


    9.           Counterparts.  This
Agreement may be executed in multiple counterparts, each of which shall, for all
purposes, be deemed an original, but which together shall constitute one and the
same instrument.

    


    


    EXECUTED
and EFFECTIVE on this the 27 day of November, 2009.

    


    


    FORTSON
PARTIES:

    


    
      


      By:   /s/ Ben J.
Fortson                          


      BEN J.
FORTSON,  INDIVIDUALLY

      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      


      FORTSON PARTIES
(con’t):

      


      


      


      


      /s/ Katherine Fortson Wynne

      KATHERINE
FORTSON WYNNE

      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      


      
 

      FORTSON PARTIES
(con’t):

      


      


      BENCO
ENERGY, INC.

      


      


      


      By:   /s/ Ben J.
Fortson, III_____________

      Ben J. Fortson, III, its
President

      


      


      


      
 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      


      


      FORTSON PARTIES
(con’t):

      


      


      


      


      /s/ Karen Fortson
Davis             


      KAREN
FORTSON DAVIS

      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      


      
 

      


      FORTSON PARTIES
(con’t):

      


      


      


      


      /s/ Lisa Fortson
Burton           
 

      LISA
FORTSON BURTON

      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      


      


      FORTSON PARTIES
(con’t):

      


      


      MATTIE
K. CARTER TRUST

      


      


      


      By: /s/ Ben J.
Fortson                      


      Ben J. Fortson, as Trustee

      


      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      


      FORTSON PARTIES
(con’t):

      


      


      HANNAH
E. DAVIS 2006 TRUST

      


      


      


      By:_/s/ Ben J. Fortson,
III                         


      Ben J. Fortson, III, as
Trustee

      


      


      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      


      FORTSON PARTIES
(con’t):

      


      


      KATHERINE
ROSE DAVIS 2006 TRUST

      


      


      


      By:_ /s/ Ben J. Fortson,
III                     


      Ben J. Fortson, III, as
Trustee

      


      


      


      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      

 

      


      FORTSON PARTIES
(con’t):

      


      


      DAVID
PAUL DAVIS 2006 TRUST

      


      


      


      By:_ /s/ Ben J. Fortson,
III                  
 

      Ben J.
Fortson, III, as Trustee

      


      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      


      


      FORTSON PARTIES
(con’t):

      


      


      WYNNE
CHILDREN’S IRREVOCABLE ASSET TRUST

      F/B/O
JOHN R. WYNNE II

      


      


      


      By: /s/ Mitchell S.
Wynne                    
   

      Mitchell S. Wynne, as
Trustee

      


      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      


      


      


      FORTSON PARTIES
(con’t):

      


      


      WYNNE
CHILDREN’S IRREVOCABLE ASSET TRUST

      F/B/O
LISA KATHERINE WYNNE

      


      


      


      By:_ /s/ Mitchell S.
Wynne                      
 

      Mitchell S. Wynne, as
Trustee

      


      


      
 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      


      FORTSON PARTIES
(con’t):

      


      


      WYNNE
CHILDREN’S IRREVOCABLE ASSET TRUST

      F/B/O
DAVID MITCHELL WYNNE

      


      


      


      By:  
/s/ Mitchell S.
Wynne                               


      Mitchell S. Wynne, as
Trustee

      


      


      


      


      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
 

      FORTSON PARTIES
(con’t):

      


      


      BURTON
FAMILY CHILDREN’S TRUST

      


      


      


      By: /s/ William K.
Burton                            


      William K. Burton, as
Trustee

      


      


      


      
 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      


      


      


      


      


      VANGUARD:

      


      VANGUARD
PERMIAN, LLC.

      


      


      By:           /s/ Scott W.
Smith                                              


      


      Name: 
Scott W.
Smith                                                     


                         



      Title:   
Manager                                                            


    

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    EXHIBIT
“A”

    


    [list
“Leases” to be amended]

    


    


    


    
      
        	
                Lease
      #

              	
                Lessor

              	
                Lessee

              	
                Lease
      Date

              	
                Vol.
      /Page

              	
                Description

              
	
                Benjamin

              	 
      	 
      	 
      	 
      
	
                FEE-0002

              	
                Mattie
      Kay Carter Trust, et al

              	
                Fortson
      Oil Company

              	
                5/1/2003

              	
                740  /695

              	
                Tract
      1:  526.64 acres, more or less, being all of Section No. 47, Scrap
      File 7850, Ward County, Texas by re-survey determined to contain 766.64
      acres, LESS AND
      EXCEPT 80 acres covered by those two certain Oil, Gas and Mineral
      Leases(“Pioneer and Parker & Parsley Leases”), one dated September 20,
      1997, by and between Ben J. Fortson, Trustee, et al, Lessor, and Pioneer
      Natural Resources USA, Inc., Lessee, recorded in Volume 663, Pages
      681-688; and one dated July 18, 1997, by and between Benjamin J. Fortson,
      Trustee, et al, Lessor, and Parker & Parsley Development, L.P., Lessee
      recorded in Volume 662, Page 66-74 of the Deed Records, Ward County,
      Texas, and  LESS AND EXCEPT 80 acres
      covered by that certain Oil and Gas Lease dated February 22, 1998, by and
      between Ben J. Fortson, Trustee of the Mattie K. Carter Trust, Lessor, and
      Ben J. Fortson, Individually, et al, Lessees, recorded in Volume 666, Page
      573, of the Deed Records, Ward County, Texas, said 80 acres surrounding
      the Fortson Oil Company Benjamin #3, located 660 feet from the northwest
      line and 330 feet from the southwest line of Section 47, D. T. Johnson
      Survey, Ward County, Texas, as described in that certain Correction of
      Assignment and Bill of Sale dated August 7, 2003 from Benjamin J. Fortson,
      Trustee, et al, to Fortson Oil Company, recorded in Volume743, Page 433,
      Official Public Records, Ward County, Texas, and LESS AND EXCEPT the
      south 80 acres, more or less, also known as the Fortson Tract, being those
      acres not included in the “Pioneer and Parker and Parsley
      Leases”,  included in that certain Pooling Agreement and
      Designation of Pooled Unit Fortson 47 Unit No. 1H Well (160-Acre Oil and
      Gas Unit No. 1), dated effective February 6, 2008, by and between Cimarex
      Energy Co., Fortson Oil Company, and Energen Resources Corporation,
      recorded in Volume 837, Page 88, Official Public Records, Ward County,
      Texas, limited INSOFAR AS
      AND ONLY INSOFAR AS to the Interval Pooled as more fully described
      therein.

                Tract
      2:  462.63 acres, more or less, out of Section 45, D. T. Johnson
      Survey, Scrap 7849, Ward County, Texas.

              
	
                Miller

              	 
      	 
      	 
      	 
      
	
                FEE-0003

              	
                Mattie
      Kay Carter Trust, et al

              	
                Fortson
      Oil Company

              	
                9/1/2008

              	
                850  /399

              	
                Section
      7, G. D. Houston Survey, SF 7038, Ward County, Texas, containing 634.5
      acres, more or less.

              
	
                Benjamin
      #3-H

              	 
      	 
      	 
      	 
      
	
                FEE-0004

              	
                Mattie
      Kay Carter Trust et al

              	
                Benjamin
      J. Fortson, Trustee, et al

              	
                2/22/1998

              	
                666  /573

              	
                80
      acres surrounding and associated with the Fortson Oil Company Benjamin #3,
      located 660 feet from the northwest line and 330 feet from the southwest
      line of Section 47, D. T. Johnson Survey, Ward County, Texas, as described
      in that certain Correction of Assignment and Bill of Sale dated August 7,
      2003 from Benjamin J. Fortson, Trustee, et al, to Fortson Oil Company,
      recorded in Volume743, Page 433, Official Public Records, Ward County,
      Texas, as to those depths described in that certain Amendment of Oil and
      Gas Lease dated effective July 1, 2007 from Ben J. Fortson, Trustee, et
      al, to Mattie K. Carter Trust, et al, recorded in Vol.   , Page  , Official Public Records, Ward,
      County, Texas.

              


      



    


    


    


    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    EXHIBIT
“B”

    


    [list
the three “Fortson 47 Leases”]

    


    


    


    


    
      	
              Lease
      #

            	
              Lessor

            	
              Lessee

            	
              Lease
      Date

            	
              Vol.
      /Page

            	
               

              Description

            
	
              Fortson
      47 #1-H

            	 
      	 
      	 
      	 
      
	
              FEE-0002

            	
              Mattie
      Kay Carter Trust, et al

            	
              Fortson
      Oil Company

            	
              5/1/2003

            	
              740  /695

            	
              80
      acres, more or less, out of Tract 1 being the south 80 acres, also known
      as the Fortson Tract, described in that certain Pooling Agreement and
      Designation of Pooled Unit Fortson 47 Unit No. 1H Well (160-Acre Oil and
      Gas Unit No. 1), dated effective February 6, 2008, by and between Cimarex
      Energy Co., Fortson Oil Company, and Energen Resources Corporation,
      recorded in Volume 837, Page 88, Official Public Records, Ward County,
      Texas, limited INSOFAR AS
      AND ONLY INSOFAR AS to the Interval Pooled as more fully described
      therein.

            
	
              FEE-0005

            	
              Mattie
      Kay Carter Trust et al

            	
              Pioneer
      Natural Resources USA, Inc.

            	
              9/20/1997

            	
              663  /681

            	
              80
      acres of land out of Section 47, Scrap File 7850 Ward County,
      Texas.

            
	
              FEE-0006

            	
              Benjamin
      J. Fortson, Trustee

            	
              Parker
      & Parsley Development L.P.

            	
              7/18/1997

            	
              662  /66

            	
              80
      acres of land out of Section 47, Scrap File 7850 Ward County,
      Texas.

            


    

    


    


    


    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    


    


    


    


    EXHIBIT
“C”

    


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

     

    


    
      	
              STATE OF TEXAS

            	
              §

            	 
      
	 
      	
              §

            	
              KNOW ALL MEN BY THESE
    PRESENTS:

            
	
              COUNTY OF WARD

            	
              §

            	 
      


    

    


    AMENDMENT TO OIL AND GAS
LEASE

    


    Reference is hereby made to that
certain Oil and Gas Lease, entered into as of the ___ day of _____ ___, by and
between _______________________________, and _____________________, recorded at
Volume ___ Page _____ of the Deed Records of Ward County, Texas (the “Lease”).

    


    WHEREAS,
___________________________________, whose addresses collectively are 301
Commerce Street, Suite 2900, Fort Worth, Texas  76102 are the current
owners of the lessor’s interest under the Lease (collectively the “Current Lessors”);

    


    WHEREAS, Vanguard Permian, LLC, whose
address is 7700 San Felipe, Suite 465, Houston, Texas  77063 is the
current owner of the lessee’s interest in the Lease (the “Current Lessee”);
and

    


    WHEREAS, the Current Lessors and the
Current Lessee hereby desire to execute this Amendment to Oil and Gas Lease (the
“Lease
Amendment”) to reduce the Current Lessors’ royalty currently provided for
in the Lease;

    


    NOW, THEREFORE, the Current Lessors and
Current Lessee, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged and confessed, and the covenants and agreements
stated herein, hereby amend the terms of the Lease as set forth
below:

    


    1.           All
of the references to the amount “twenty-five percent (25%)” in paragraph 5 of
the Lease shall be deleted and replaced with the amount
“three-sixteenths (3/16th).”

    


    2.           All
notices to Current Lessors and/or information to be provided to Current Lessors
which are required or may be given under the Lease may be made jointly to the
Current Lessors at the following address:

    


    


                                               Fortson
Production Company

    301 Commerce St., Suite
2900

    Fort Worth, Texas 76102

    Attn:           David
Frazier

    Telephone:                      (817)
335-5641

    Telecopy:                      (817)
336-4853

    


     3.           Current
Lessors acknowledge that Current Lessors have provided their consent to the
execution of all currently in place production sales contracts, marketing
contracts and other contracts applicable to the sale of oil or the sale of gas
produced from the lands covered by the Lease, and that the methodology for the
calculation of prices under such contracts reflects “market value” for purposes
of the calculation of royalties under the Lease.

    


    4.           Current
Lessors acknowledge that all royalties that have been paid under the Lease have
been made without deduction or cost of gathering, transporting, separating,
dehydrating, compressing or otherwise in making the oil or gas ready for sale or
use as required by the Lease.

    


    5.           Current
Lessors agree that any forfeiture described in Section 5(i) of the Lease shall
apply with respect to the well for which the applicable sum has not been paid,
and a portion of the leased premises sufficient (a) to include the entire
wellbore, (b) to permit such well to produce with a full allowable, and (c) to
make the location of its entire wellbore in compliance with all applicable well
spacing and density rules of the Railroad Commission of Texas; such portion of
the leased premises shall be designated by the Current Lessors in their
reasonable discretion.

    


               6.           Pursuant
to Section 14 of the Lease, Current Lessors acknowledge that Current Lessors
have received all information required to be furnished to Current Lessors and
Current Lessors have approved the assignment of the Lease to the Current
Lessee.

    


    7.           This
Lease Amendment may be signed in any number of counterparts, each of which shall
be considered an original for all purposes, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

    


    8.           By
executing this Lease Amendment, the Current Lessors acknowledge that the Lease
is in full force and effect, and ratify the Lease as to all of its terms
including those contained herein, and the Current Lessors acknowledge that no
default or breach has occurred under the Lease.

    


    EXECUTED on the date(s) subscribed to
the acknowledgements below, but for all purposes effective as of 7:00
am CST, on October 1, 2009.

    


    CURRENT
LESSORS:

    


    [insert
signature blocks]

    


    CURRENT
LESSEE:

    


    [insert
signature blocks]

    ACKNOWLEDGMENTS

    [insert
acknowledgements]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
“D”

    


    NOTICE
OF CONFIDENTIALITY RIGHTS:  IF YOU ARE A NATURAL PERSON, YOU MAY
REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT
THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE
PUBLIC RECORDS:  YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE
NUMBER.

    


    ROYALTY
DEED

    


    
      	
              STATE OF TEXAS

            	
              §

            	 
      
	 
      	
              §

            	
              KNOW ALL MEN BY THESE
    PRESENTS:

            
	
              COUNTY OF WARD

            	
              §

            	 
      


    

    


    That Ben J. Fortson also known as
Benjamin J. Fortson, Trustee of the Mattie K. Carter
Trust, and Ben J. Fortson, individually, Benco Energy, Inc.,
Katherine Fortson Wynne, Karen Fortson Davis, and Lisa Fortson Burton, each
dealing in their separate property, Hannah E. Davis 2006 Trust, David Paul Davis
2006 Trust a/k/a David P. Davis 2006 Trust, Katherine Rose Davis 2006 Trust
a/k/a Katherine R. Davis 2006 Trust, Wynne Children’s Irrevocable Asset Trust
f/b/o John R. Wynne II a/k/a Wynne Children’s Irrevocable Asset Trust f/b/o John
Robert Wynne II, Wynne Children’s Irrevocable Asset Trust f/b/o Lisa Katherine
Wynne a/k/a Wynne Children’s Irrevocable Asset Trust f/b/o Lisa Wynne Trust,
Wynne Children’s Irrevocable Asset Trust f/b/o David Mitchell Wynne a/k/a Wynne
Children’s Irrevocable Asset Trust f/b/o David Mitchell Wynne Trust, and Burton
Family Children’s Trust, all of whose
address is 301 Commerce Street, Suite 2900, Fort Worth, Texas  76102
(collectively, “Grantor”), for good
and valuable consideration in hand paid by Vanguard Permian, LLC, whose address is 7700
San Felipe, Suite 465, Houston, Texas  77063  (“Grantee”), the
receipt and sufficiency of which is hereby acknowledged and confessed, has
GRANTED, BARGAINED, SOLD and CONVEYED, and by these presents does hereby GRANT,
BARGAIN, SELL and CONVEY unto Grantee, an undivided twenty-five percent (25%) of
Grantor’s right, title, and interest in and to all of the royalties payable to
the lessor under the three oil and gas leases described on Exhibit “1” hereto
(the “Subject
Leases”), reserving unto Grantor an undivided seventy-five percent (75%)
of Grantor’s right, title, and interest in and to all of the royalties payable
to the lessor under the Subject Leases.

    


    Grantor hereby agrees to WARRANT and
FOREVER DEFEND, all and singular the above-conveyed undivided interest in the
lease royalties unto Grantee and Grantee’s successors and assigns, against every
person whomsoever lawfully claiming or to claim the same or any
part  thereof, by, through, or under Grantor, but not
otherwise.

    


    This conveyance may be executed in
multiple counterparts, each of which shall constitute an original hereof, and
the execution and delivery of any one of such counterparts by any signatory
party shall have the same force and effect and shall be binding upon such
signatory to the same extent as if the same counterpart were executed and
delivered by all of the signatory parties.

    


    IN WITNESS WHEREOF, this Royalty Deed
is executed as of the dates subscribed to the respective acknowledgments set
forth below to be EFFECTIVE as of 7:00 A.M., C.S.T., on October 1,
2009.

    


    


    [INSERT SIGNATURE BLOCK FOR EACH
GRANTOR]

    ACKNOWLEDGMENTS

    


    [INSERT FORM OF ACKNOWLEDGMENT FOR
EACH GRANTOR]

    


    STATE OF
TEXAS                                                      §

    §

    COUNTY
OF__________                                                      §

    


    This instrument was acknowledged before
me on this the ___ day of __________, 2009 by
______________________.

    


    


    


    Notary
Public in and for the State of Texas

    


    


    (Type or
print Notary's name)

    My
commission
expires:                                                                

    


    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    Exhibit
“1”

    


    [describe
the 3 Fortson 47 Leases here]