Exhibit 10.80


                           PURCHASE AND SALE AGREEMENT

                                     BETWEEN

                              BARON PRODUCTION LLC.

                                    AS SELLER

                                       AND

                                 PCEC SUB 1, LLC

                                    AS BUYER

                                   DATED AS OF

                                  JULY 28, 2014

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Purchase and Sale Agreement                  20

                             TABLE OF CONTENTS

ARTICLE I. DEFINITIONS........................................................1
Section 1.1 Certain Definitions...............................................1
Section 1.2 Other Definitions; Incorporation of Conveyance and Production
            and Marketing Agreement Definitions...............................3
Section 1.3 Rules of Construction.............................................3

ARTICLE II. TRANSACTIONS......................................................4
Section 2.1 Purchase and Sale.................................................4
Section 2.2 Tax Reporting.....................................................4

ARTICLE III. REPRESENTATIONS, WARRANTIES AND COVENANTS OF WORKING
             INTEREST OWNER...................................................4
Section 3.1 Representations and Warranties of Working Interest Owner..........4
Section 3.2 Use of Proceeds..................................................12

ARTICLE IV. REPRESENTATIONS OF ROYALTY OWNER.................................12
Section 4.1 Representations of Royalty Owner.................................12

ARTICLE V. CONDITIONS TO CLOSING.............................................12
Section 5.1 Conditions to Obligations of Working Interest Owner..............12
Section 5.2 Conditions to Obligations of Royalty Owner.......................13

ARTICLE VI. CLOSING..........................................................14
Section 6.1 Place of Closing.................................................14
Section 6.2 Closing Documents................................................14
Section 6.3 Preclosing and Funding...........................................16

ARTICLE VII. MISCELLANEOUS...................................................16
Section 7.1 Announcements; Confidentiality; Patriot Act......................16
Section 7.2 Survival.........................................................17
Section 7.3 Expenses.........................................................17
Section 7.4 Notices..........................................................18
Section 7.5 Governing Law....................................................18
Section 7.6 Successors and Assigns...........................................18
Section 7.7 Entire Agreement; Amendments; Waivers............................19
Section 7.8 Counterparts.....................................................19
Section 7.9 WAIVER OF JURY TRIAL AND OF PUNITIVE DAMAGES.....................20
Section 7.10 CONSENT TO JURISDICTION.........................................20

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EXHIBITS AND SCHEDULES

EXHIBIT A     Certification of Non-Foreign Status
EXHIBIT B-1   Form of Legal Opinion of Stewart & Bonnett, LLP
EXHIBIT B-2   Form of Legal Opinion of Lionel Sawyer & Collins

SCHEDULE 3.1  Disclosure Schedule
SCHEDULE 6.3  Wire Instructions

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                           PURCHASE AND SALE AGREEMENT

     This Purchase and Sale  Agreement  (this  "Agreement")  dated as of July 28
2014, is made by and between  Baron  Production  LLC, a Texas limited  liability
company ("Working  Interest Owner" and a "Party"),  and PCEC Sub 1, LLC, a Texas
limited liability company ("Royalty Owner" and a "Party").

                              W I T N E S S E T H:

     WHEREAS,  Working Interest Owner is the owner of the Subject  Interests (as
defined in the Conveyance referred to below); and

     WHEREAS,  Working  Interest Owner desires to sell and Royalty Owner desires
to purchase the Production Payment (as defined in the Conveyance);

     NOW, THEREFORE,  in consideration of the mutual benefits and obligations of
the Parties contained herein, the Parties hereby agree as follows:

                                   ARTICLE I.
                                  DEFINITIONS

     Section 1.1 Certain Definitions.  As used herein, the following terms shall
have the meanings set forth below, except as otherwise expressly provided:

     "Closing" means the completion of certain of the transactions  contemplated
hereby as described in Section 6.4.

     "Closing Date" means the date on which the Closing is completed.

     "Closing  Documents"  means,  collectively,  the Conveyance,  and any other
documents or  instruments  executed or delivered by or on behalf of any Party at
or before or in connection with the Closing.

     "Conveyance" means the Conveyance of Term Overriding Royalty Interest dated
as of the date hereof made by Working  Interest  Owner to Royalty  Owner that is
executed in connection herewith.

     "Disclosure Schedule" means Schedule 3.1 to this Agreement.

     "Good and  Defensible  Title"  means  such title to the  Subject  Interests
(properly  reflected  of record)  that,  after  giving  effect to the  Permitted
Encumbrances,  (a) will enable  Working  Interest  Owner to truthfully  make the
representations  and  warranties in Section 1.9 of the Conveyance and (b) except
for the Permitted Encumbrances (i) is free and clear of any encumbrances, liens,
security interests, mortgages, pledges, preferential purchase rights (other than
those that have been waived),  or requirements for consents to assignment (other
than those that have been  obtained)  that would be applicable to or exercisable

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as a result of the Conveyance and the other Closing Documents,  and (ii) is free
and clear of any defects  that would  materially  affect or  interfere  with the
operation, use, possession, ownership or value thereof.

     "Initial  Engineers"  means  Cawley,  Gillespie  and  Associates  and  Haas
Petroleum Engineering Services, Inc.

     "Internal  Revenue  Code"  means  the  Internal  Revenue  Code of 1986,  as
amended.

     "Mortgage" means the Second Lien Deed of Trust,  Assignment of As-Extracted
Collateral,  Security Agreement,  Fixture Filing and Financing Statement of even
date herewith executed in connection  herewith by Working Interest Owner for the
benefit of Royalty  Owner with  respect to the  Retained  Interests  and certain
Related Assets.

     "Parent" means Baron Energy, Inc. a Nevada corporation.

     "Parent  Guaranty  Agreement"  means the  Guaranty  Agreement  of even date
herewith  executed in connection  herewith by Working interest Owner in favor of
Royalty Owner.

     "Parties" means Working Interest Owner and Royalty Owner.

     "Production  and Marketing  Agreement"  means the  Production and Marketing
Agreement dated as of the date hereof between Royalty Owner and Working Interest
Owner that is executed in connection herewith.

     "Production Payment" has the meaning specified in the Conveyance.

     "Projected Yield" means twenty percent (20%) per annum.

     "Purchase Price" means $6,100,000.00.

     "Related   Assets"  means  (i)  the  Subject   Interests  and  the  Subject
Hydrocarbons,  together  with  all  rights,  titles,  interests,  appurtenances,
benefits and privileges of Working  Interest Owner  attributable to each Subject
Interest;  (ii) all of the real,  immovable,  personal and mixed property of the
Working Interest Owner (whether located on or off the Subject Interests) used in
connection  with or attributable in any manner to the exploration or development
of the  Subject  Interests  for  Hydrocarbons,  the  operation  of  the  Subject
Interests,  the treating,  storing or transporting of Hydrocarbons produced from
the  Subject  Interests,  or the  disposal  or  transporting  of water and other
byproducts of such production  (including salt water injection wells and related
facilities);  (iii) all rights of the Working Interest Owner with respect to any
and all contracts, agreements, instruments,  governmental orders and contractual
rights  insofar as they cover or relate in any manner  whatsoever to the Subject
Interests; (iv) all rights of the Working Interest Owner with respect to any and
all easements,  rights-of-way,  rights, permits, licenses and servitudes insofar
as they are used or held in  connection  with the  exploration,  development  or

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operation  of the  Subject  Interests  or  the  transportation  of  Hydrocarbons
produced  therefrom;  (v) all  proceeds  of the  foregoing;  and (vi) all files,
records,  data and  documentation  of the Working  Interest Owner  pertaining or
related to the Subject Interests or any of the assets described in the preceding
clauses (i) through (v).

     "Ricochet  PSA" means the Purchase and Sale  Agreement  dated as of May 29,
2014,  among Ricochet  Energy,  Inc.,  the other sellers party thereto,  and the
Parent.

     Section 1.2 Other  Definitions;  Incorporation of Conveyance and Production
and Marketing Agreement  Definitions.  Other capitalized terms defined elsewhere
in this Agreement have the meanings so given them herein.  Each capitalized term
used herein but not defined herein has the meaning given to it in the Conveyance
or (if not defined therein) in the Production and Marketing Agreement.

     Section  1.3  Rules of  Construction.  The  headings  of the  articles  and
sections of this  Agreement  are for  convenience  of reference  only and do not
limit or otherwise affect any of the terms or provisions of this Agreement.  All
references  in this  Agreement  to  articles,  sections,  subsections  and other
subdivisions refer to corresponding  articles,  sections,  subsections and other
subdivisions  of this Agreement  unless  expressly  provided  otherwise.  Titles
appearing at the beginning of any of such subdivisions are for convenience only,
do not  constitute  part of  such  subdivisions,  and  will  be  disregarded  in
construing  the  language  contained  in  such  subdivisions.  The  words  "this
Agreement",  "this  instrument",  "herein",  "hereof",  "hereunder" and words of
similar  import  refer to this  Agreement  as a whole and not to any  particular
subdivision unless expressly so limited.  Unless the context otherwise requires:
"including" its grammatical variations mean "including without limitation"; "or"
is not  exclusive;  words in the singular  form will be construed to include the
plural and vice versa; words in any gender include all other genders; references
herein to the Conveyance,  the Production and Marketing Agreement, the Mortgage,
the Parent Guaranty Agreement or any other instrument or agreement refer to such
instrument or agreement as it may be from time to time amended,  supplemented or
restated;  and references herein to any Person include such Person's  successors
and assigns. All references in this Agreement to exhibits and schedules refer to
exhibits and schedules to this Agreement  unless expressly  provided  otherwise,
and all such exhibits and schedules are hereby  incorporated herein by reference
and made a part hereof for all  purposes.  This  Agreement and the other Closing
Documents  have been drafted with the joint  participation  of Working  Interest
Owner and Royalty Owner and are to be construed  neither against nor in favor of
either Party but rather in accordance with the fair meaning hereof.

                                  ARTICLE II.
                                 TRANSACTIONS

     Section 2.1 Purchase and Sale.  Subject to and in accordance with the terms
hereof,  Working  Interest Owner agrees to sell and convey to Royalty Owner, and
Royalty Owner agrees to purchase from Working  Interest  Owner,  the  Production

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Payment for consideration  equal to the Purchase Price, and the Parties agree to
execute and deliver the Closing  Documents.  Working Interest Owner acknowledges
and agrees that the foregoing  constitutes  payment to Working Interest Owner of
reasonably  equivalent value for the Production Payment.  Royalty Owner will pay
the  Purchase  Price to Working  Interest  Owner at the  Closing as  provided in
Section 6.3.

     Section 2.2 Tax Reporting. The Parties intend for the Production Payment to
be treated for federal income tax purposes (and for the purpose of any similarly
calculated  state income or  franchise  taxes,  but for no other  purposes) as a
mortgage loan (and not a "royalty" or other  "economic  interest"  Hydrocarbons)
within the meaning of the Internal Revenue Code and the regulations and judicial
authority  relating  thereto,  and the  Parties  agree to report the  Production
Payment accordingly on all applicable tax returns. In so doing, Working Interest
Owner will apply the  "noncontingent  bond method" of calculating  principal and
interest  as  provided  in  Treasury  Regulation  section  1.1275-4(b),  using a
comparable  yield  equal to the  Projected  Yield and  calculating  a  projected
payment schedule based on the Scheduled  Quantities  provided in the Conveyance.
If the Scheduled  Quantities are ever adjusted as provided in the Production and
Marketing Agreement, Working Interest Owner, with the approval of Royalty Owner,
will  adjust the  projected  payment  schedule  to reflect  such  changes in the
Scheduled Quantities and will appropriately reflect such adjustment to projected
payments  in  determining  the  amount of the net  adjustment  to be taken  into
account under Treasury Regulation section 1.1275-4(b)(6).

                                  ARTICLE III.
              REPRESENTATIONS, WARRANTIES AND COVENANTS OF WORKING
                                 INTEREST OWNER

     Section 3.1  Representations  and Warranties of Working  Interest Owner. In
order to induce  Royalty  Owner to enter  into this  Agreement  and the  Closing
Documents and to consummate the transactions  described herein, Working Interest
Owner hereby  represents and warrants to Royalty Owner,  and to each beneficiary
under any Mortgage,  both as of the date Working  Interest  Owner  executes this
Agreement and as of the Closing Date, as follows:

     (a)  Existence and  Authorization.  Working  Interest  Owner and is limited
liability  company duly organized,  validly  existing and in good standing under
the Laws of the State of Texas.  Working  Interest  Owner has the right,  power,
authority,  and  qualifications  necessary  to conduct its  business and own its
properties  (including,  as  applicable,  the Subject  Interests and the Related
Assets) in such State, to execute and deliver the Closing  Documents to which it
is a party, to perform all of its  obligations  under the same, and to convey to
Royalty Owner the Production  Payment.  Working Interest Owner is not a "foreign
person"  within the meaning of Sections  1445 and 7701 of the  Internal  Revenue
Code  (i.e.,  Working  Interest  Owner  is  not a  non-resident  alien,  foreign
corporation, foreign partnership, foreign trust or foreign estate as those terms
are  defined  in the  Internal  Revenue  Code  and any  regulations  promulgated
thereunder).

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     (b) No  Conflicts.  The  execution,  delivery  and  performance  by Working
Interest  Owner of the  Closing  Documents  to  which  it is a party  (including
Working  Interest  Owner's  application  of the  Purchase  Price as  provided in
Section 3.2) are within the limited  liability company power of Working Interest
Owner,  have been duly authorized by all necessary action on the part of Working
Interest Owner and its members and managers, as applicable,  and do not and will
not (i) violate any provision of Working Interest  Owner's charter  documents or
other governing documents, (ii) violate any provision of Law or any order, writ,
judgment,  decree or determination  currently in effect having  applicability to
Working  Interest  Owner,  (iii)  result in a breach of or  constitute a default
under any Lease,  any agreement  binding or affecting the Subject  Interests (or
Working  Interest Owner with respect to the Subject  Interests),  any indenture,
bank loan, credit agreement or farmout  agreement,  program  agreement,  area of
mutual interest agreement,  unit agreement or operating agreement,  or any other
agreement or instrument to which Working  Interest  Owner is a party or by which
Working Interest Owner or Working  Interest Owner's  properties may be currently
bound or affected,  (iv) cause Working Interest Owner to become obligated to (or
obligated  to offer to) prepay,  redeem or  purchase  any  indebtedness,  or (v)
except as set forth in Section 3.1(b) of the Disclosure  Schedule and other than
pursuant to the Mortgage, result in or require the creation or imposition of any
mortgage,  lien, pledge, security interest,  charge or other encumbrance upon or
of any of the  properties or assets of Working  Interest  Owner  (including  the
Subject  Interests).  Working  Interest Owner is not in default under any order,
writ, judgment, decree, determination, indenture, agreement or instrument in any
manner that now or in the future could  adversely  affect the ability of Working
Interest  Owner to  perform  Working  Interest  Owner's  obligations  under this
Agreement or the Closing  Documents to which it is a party,  and all consents or
approvals under such indentures,  agreements and instruments necessary to permit
the valid execution,  delivery, and performance by Working Interest Owner of the
Closing  Documents to which it is a party and the  conveyance of the  Production
Payment to Royalty Owner have been obtained.

     (c) Consents, Preferential Rights and Required Notices. Except as disclosed
in Section  3.1(c) of the  Disclosure  Schedule,  all  consents  and  waivers of
preferential  purchase or other rights  necessary to permit the valid conveyance
to Royalty  Owner of the  Production  Payment and execution and delivery of this
Agreement  and  the  Closing   Documents   have  been   obtained.   All  advance
notifications (if any) to third parties of the transactions  contemplated herein
and in the Closing Documents necessary to permit the valid conveyance to Royalty
Owner of the Production Payment and execution and delivery of this Agreement and
the Closing  Documents  have been or will be, prior to the Closing Date,  timely
and properly given.

     (d) Financial  Statements;  No Material Adverse  Changes.  Working Interest
Owner has  heretofore  delivered  to Royalty  Owner true,  correct and  complete
copies of the Parent's most recent audited annual financial statements (dated as
of  July  31,  2011),  the  Parent's  most  recent  unaudited  annual  financial
statements  (dated  July  31,  2013)  and the  Parent's  most  recent  unaudited
quarterly  financial  statements  (dated as of April 30, 2014).  Such  financial
statements  were  prepared in  accordance  with  generally  accepted  accounting
principles,   consistently   applied,  and  fairly  represent  the  consolidated

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financial  position of Parent and its  subsidiaries  as of the dates thereof and
their  consolidated  results of operations and  consolidated  cash flows for the
periods  indicated  therein  (subject,  in the case of such unaudited  financial
statements, to normal year-end adjustments and the absence of footnotes). Except
for matters  described in Section 3.1(d) of the Disclosure  Schedule,  since the
date of the most  recent  audited  balance  sheet  contained  in such  financial
statements,  no  material  adverse  change  has  occurred  to  the  consolidated
financial  condition  of Parent and its  subsidiaries  or to their  consolidated
operations, cash flows, properties or prospects.

     (e)   Governmental   Approvals.   Except  for  approvals  by   governmental
authorities  that are  customarily  obtained after closing and listed in Section
3.1(e) of the Disclosure  Schedule,  (i) Working Interest Owner has obtained all
authorizations,  consents,  approvals,  licenses and exemptions of, and has made
all  filings  and  registrations  with,  any court or  governmental  department,
commission, board, bureau, agency or instrumentality,  domestic or foreign, that
are necessary for the valid execution and delivery by Working  Interest Owner of
the Closing  Documents to which it is a party,  and (ii) Working  Interest Owner
has  obtained  all  such  authorizations,   consents,  approvals,  licenses  and
exemptions,  and has made all such filings or registrations,  that are currently
required for the  performance  of its  obligations  under this Agreement and the
Closing Documents to which it is a party.

     (f) Enforceability.  This Agreement has been duly executed and delivered by
Working Interest Owner, and as of the Closing Date each of the Closing Documents
will have been duly  executed and  delivered  by Working  Interest  Owner.  This
Agreement constitutes,  and as of the Closing Date each of the Closing Documents
will  constitute,  the legal,  valid and binding acts and obligations of Working
Interest Owner,  enforceable in accordance with its terms, subject,  however, to
bankruptcy,  insolvency,  reorganization,  moratorium  and other Laws  affecting
creditors' rights generally and to general principles of equity.

     (g)  Effective  Conveyance  of Property  Interest.  Upon due  execution and
delivery by Working  Interest Owner of the  Conveyance,  (i) the Conveyance will
constitute the legal, valid and binding conveyance of the Production Payment out
of the Subject  Interests,  and (ii) the Production  Payment will  constitute an
interest in real property  owned by Royalty  Owner (and not by Working  Interest
Owner) and will constitute a "production payment" as defined in Section 101(42A)
of  the  Bankruptcy  Code,  and  referred  to in  Section  541(b)(4)(B)  of  the
Bankruptcy Code. Neither the Conveyance nor any Subject Interest constitutes, or
will constitute,  an executory contract or unexpired lease within the meaning of
Section 365 of the United States Bankruptcy Code.

     (h)  Full  Disclosure.  The  information,   memoranda,  exhibits,  reports,
financial  statements  and other  data  furnished  by or on  behalf  of  Working
Interest  Owner to  Royalty  Owner and its  Affiliates  in  connection  with the
transactions  described  herein,  including the data supplied by or on behalf of
Working  Interest Owner to the Initial  Engineers for use in evaluating the data
supplied by Working  Interest Owner to Royalty Owner,  do not contain any untrue
statement  of a  material  fact or omit  to  state  any  material  fact  that is
necessary in order to make the statements therein, in light of the circumstances

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under which such statements were made, not misleading. There is no fact that has
not been  disclosed  to Royalty  Owner  that could  reasonably  be  expected  to
adversely  affect the value of the  Production  Payment or adversely  affect the
value of the  Subject  Interests.  Except  as listed  in  Section  3.1(h) of the
Disclosure  Schedule,  there are no  reserves  in the data  supplied  by Working
Interest Owner to Royalty  Owner's  reserve  engineers that are  attributable to
properties  and  interests  other  than the  Subject  Interests.  Except for (i)
production  from the Subject  Wells in the  ordinary  course of  business,  (ii)
matters listed in Section 3.1(h) of the Disclosure  Schedule,  and (iii) changes
in the general market prices of oil and natural gas, no material  adverse change
in the condition of or remaining recoverable proved reserves attributable to the
existing  Subject Wells or the Subject  Interests  has occurred  since April 30,
2014. The actions of Working Interest Owner in furnishing information to Royalty
Owner in connection with the  transactions  described herein do not and will not
violate  any duty owed by  Working  Interest  Owner to any  Person to which such
information  relates or any  obligation  of  Working  Interest  Owner  under any
existing agreement, document, or instrument.

     (i) Title. Working Interest Owner owns Good and Defensible Title to each of
the  Subject  Interests  and the  other  Related  Assets,  free and clear of any
encumbrances, liens or security interests (other than Permitted Encumbrances).

     (j) Taxes.  All Taxes imposed or assessed with respect to or measured by or
charged  against  or  attributable  to  the  Subject   Interests,   the  Subject
Hydrocarbons  and the Related Assets have been duly paid (including all property
and ad valorem taxes for 2013 and earlier  years),  except for those not yet due
and payable or being contested in good faith by appropriate proceedings. Working
Interest  Owner has filed all Tax returns  required to be filed and such returns
comply with  applicable  Laws.  Except as may be disclosed in Section 3.01(j) of
the Disclosure Schedule,  no taxing authority is asserting that Working Interest
Owner is liable for past due taxes.

     (k) No Tax Partnership or Other Joint Venture.  No Subject Interest is held
by, or for any  purpose  treated  as held by,  any tax  partnership  (i.e.,  any
entity,  organization or group deemed to be a partnership  within the meaning of
section 761 of the Internal  Revenue Code, after giving effect to any applicable
elections and exclusions) or any other partnership or joint venture.

     (l) Status of Leases and  Wells.  The Leases are in full force and  effect,
and Working  Interest Owner has complied with all of the terms of the Leases and
all governmental orders or directives applicable to Working Interest Owner or to
the Subject  Interests.  All rents,  royalties and other payments due or payable
with  respect  to the  Leases  have  been  paid  in a  timely  manner,  and  all
liabilities of any kind or nature  incurred with respect to the Leases have been
paid and performed before becoming delinquent.  Working Interest Owner is not in
default  (and has not received  any notice of default or claimed  default)  with
respect to any  Subject  Interest or any Lease or any part  thereof.  All wells,
facilities and equipment which constitute part of the Related Assets are in good
repair and working  condition  (other than wells  designated  for  plugging  and
abandonment  and  equipment   related  thereto)  and  have  been  installed  and

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maintained  in  accordance  with  good  industry  standards  and all  applicable
statutes,  rules,  regulations,  orders, permits or licenses of any governmental
authority,  agency or court. No well comprising part of the Subject Interests is
or was  subject to any penalty on  allowables  after the  effective  date of the
Conveyance  because of any  over-production  (or any other judgments,  orders or
decrees of any court or  governmental  authority or agency) which would (or did)
prevent  such well from being  entitled to its full legal and regular  allowable
(as prescribed by any  governmental  authority,  agency or court) from and after
such  effective  date.  If a tract or tracts of land are listed on the  Property
Exhibit to the Conveyance  with respect to a Subject Well,  such Subject Well is
located on such tract or tracts of land. If the Subject Interests  pertaining to
a Subject Well are limited in the Conveyance to specified  depths or formations,
such Subject Well is producing  only from such  specified  depths or formations,
and all of such specified  depths or formations are included  within the Subject
Interests that pertain to such Subject Well. None of the reserves which comprise
Production Payment Hydrocarbons are being produced from any wells other than the
Subject  Wells  listed on the  Property  Exhibit,  and if the Subject  Interests
pertaining  to a Subject Well are limited on the Property  Exhibit to particular
depths or formations,  all of such reserves  pertaining to such Subject Well are
located within such depths or formations.

     (m)  Commitments;  Contracts.  Except as set forth in Section 3.1(m) of the
Disclosure Schedule:

     (i) no third  party  has any right to  purchase  any  Subject  Hydrocarbons
(including any call,  right of first refusal or preferential  right to purchase)
that  does not  terminate  within  one  month or is not  terminable  by  Working
Interest Owner without penalty on notice of one month or less;

     (ii)  neither  the  Subject  Interests  nor the  Hydrocarbons  attributable
thereto are subject,  committed,  or dedicated to any joint operating agreement,
unit operating agreement, or area of mutual interest agreement; and

     (iii)  neither  the Subject  Interests  nor the  Hydrocarbons  attributable
thereto are subject,  committed,  or dedicated to any Subject Contract that will
or could  reasonably  be  expected  to (A)  reduce the  percentage  share of the
Hydrocarbons  produced  from or  allocated  to any  Subject  Interest  below the
Warranted  Net Revenue  Interest for such Subject  Interest,  (B) cause  Working
Interest  Owner  to be  obligated  to bear a  percentage  share  of the  cost of
operation of such Subject  Interest that is greater than the  Warranted  Working
Interest   Percentage  for  such  Subject  Interest   (without  a  corresponding
proportional  increase  in the  associated  Net  Revenue  Interest or a right to
reimbursement  from a  non-paying  joint  interest  owner),  or (C)  prevent  or
interfere with the ownership, exploration,  development,  operation, maintenance
or use of any of the Subject  Interests  in  accordance  with  prudent  industry
practices or in  accordance  with the manner in which such  Subject  Interest is
currently being owned, explored, developed, operated, maintained or used.

     (n)  Take or Pay,  etc.  Except  as set  forth  in  Section  3.1(n)  of the
Disclosure  Schedule,   neither  the  Subject  Interests  nor  the  Hydrocarbons
attributable  thereto  are subject to any  contract,  agreement  or  arrangement

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(including   advance  payment   agreements,   prepayments,   take-or-pay  makeup
obligations  or  otherwise)  whereby the owner of the  Hydrocarbons  or any part
thereof is not entitled to convey the Hydrocarbons or to market the Hydrocarbons
and to obtain the full market price or value of the same. No Subject Interest is
subject on the date hereof to any regulatory  refund obligation and, to the best
of Working Interest Owner's knowledge, no facts exist which might cause the same
to be imposed.

     (o)  Compliance  with Laws.  Except as set forth in  Section  3.1(o) of the
Disclosure Schedule,  (i) the Subject Interests have been owned and operated, in
accordance  with  all  applicable  Laws  (including  Environmental  Laws) of all
governmental  authorities  having  or  asserting  jurisdiction  relating  to the
ownership and operation of the Subject Interests, and Working Interest Owner and
all other  operators of the Subject  Interests are in compliance in all respects
with all  licenses  and  permits  required  under any such  Laws;  (ii)  Working
Interest  Owner has taken all steps  reasonably  necessary to determine  and has
determined  that no  Hazardous  Substance  has  been  disposed  of or  otherwise
released  on or to the  Subject  Lands or  produced  on the  Subject  Lands  and
disposed of or released elsewhere, and the use which Working Interest Owner make
and intend to make of the Subject  Lands will not result in any such disposal or
release;  (iii) none of the Subject  Interests  is the  subject of any  federal,
state or local investigation evaluating whether any remedial action is needed to
respond to a release of any Hazardous  Substances into the environment or to the
improper  storage  or  disposal   (including  storage  or  disposal  at  offsite
locations) of any Hazardous Substances; (iv) Working Interest Owner has not and,
to the knowledge of Working Interest Owner no other Person, has filed any notice
under  any  applicable  Law  indicating  that  any  Working  Interest  Owner  is
responsible  for the  improper  release  into the  environment,  or the improper
storage  or  disposal,  of  any  Hazardous  Substances  or  that  any  Hazardous
Substances have been improperly  released,  or are improperly stored or disposed
of, upon any of the Subject Lands;  and (v) neither  Working  Interest Owner nor
any Affiliate of a Working Interest Owner otherwise has any contingent liability
under  any  Environmental  Laws or in  connection  with  the  release  into  the
environment, or the storage or disposal, of any Hazardous Substances.

     (p) No Casualties or Condemnation. Except as disclosed in Section 3.1(p) of
the Disclosure Schedule,  during the twelve months preceding the Closing Date no
Casualty or  Condemnation  has occurred that,  individually or in the aggregate,
adversely  affects  any  material  portion of the  Related  Assets or the use or
operation thereof, or adversely affects the ability of Working Interest Owner to
perform its obligations  under this Agreement or the Closing  Documents to which
it is a party. As used in this subsection,  "Casualty or Condemnation" means (i)
any fire, blowout, leak, explosion, accident, earthquake, act of public enemy or
other casualty  (whether above or below ground and regardless of whether covered
by insurance)  and (ii) any pending or threatened  taking,  in  condemnation  or
under the right of eminent domain, of any Related Asset or portion thereof.

     (q)  Litigation.  Except as set forth in Section  3.1(q) of the  Disclosure
Schedule,  there are no suits or  proceedings  pending or, to the  knowledge  of
Working Interest Owner,  threatened  against or affecting Working Interest Owner

                                       9
<PAGE>
or the Related Assets that involve (i) a dispute or claim  concerning  title to,
operation of, or production from any of the Subject  Interests,  (ii) any actual
or purported lien,  security interest,  charge or burden upon any of the Subject
Interests or Subject Hydrocarbons, or (iii) any other claim which would affect a
transferee of any of the Subject  Interests or would adversely  affect the value
of the  Production  Payment.  Except  as set  forth  in  Section  3.1(q)  of the
Disclosure  Schedule,  there  are no suits or  proceedings  pending  or,  to the
knowledge of Working Interest Owner,  threatened  against Working Interest Owner
or the Related  Assets  that,  if decided  adversely  to the interest of Working
Interest Owner could adversely affect Working Interest Owner, any of the Related
Assets or the rights of Royalty Owner under the Closing Documents.  There are no
bankruptcy, reorganization or similar proceedings pending, being contemplated by
or, to the  knowledge of Working  Interest  Owner,  threatened  against  Working
Interest Owner, and Working Interest Owner has not made a general assignment for
the benefit of creditors.

     (r) No Broker's or Finder's Fees.  Working  Interest Owner has not incurred
any  obligation  or  liability  (or taken any action)  which  might  impose upon
Royalty  Owner or  Royalty  Owner's  lenders or  Affiliates  any  obligation  or
liability,  contingent or otherwise, for broker's or finder's fees in respect of
any of the  matters  provided  for  in  this  Agreement  or  the  other  Closing
Documents.

     (s) Copies of Permitted Encumbrances and Listed Documents. Working Interest
Owner has  furnished  to Royalty  Owner true and  complete  copies of all of the
joint  operating   agreements,   unit  agreements,   and  other  agreements  and
instruments  evidencing the Permitted Encumbrances that exist as of the Closing.
Working  Interest Owner has provided Royalty Owner with true and complete copies
of all contracts and instruments referred to in the Disclosure Schedule.

     (t)  Solvency.  Upon the  execution,  delivery and  performance  by Working
Interest  Owner of the  Closing  Documents  to  which  it is a party  (including
Working  Interest  Owner's  application  of the  Purchase  Price as  provided in
Section  3.2),  Working  Interest  Owner is and will be solvent (as such term is
used in  applicable  bankruptcy,  liquidation,  receivership,  or  insolvency or
similar Laws).  Working  Interest Owner's capital is adequate for the businesses
in which Working  Interest  Owner is engaged and intends to be engaged.  Working
Interest Owner has not incurred (whether hereby or otherwise),  nor does Working
Interest  Owner intend to incur or believe that it will incur,  debts which will
be beyond its ability to pay as such debts mature. None of the Closing Documents
and none of the  transactions  thereunder  constitutes  a fraudulent or voidable
transfer or conveyance within the scope of Section 548 of the Bankruptcy Code or
any other  applicable  Law  pertaining to  fraudulent  or voidable  transfers or
conveyances.

     (u) No  ERISA  Liabilities.  Working  Interest  Owner  does  not  have  any
liabilities or obligations of any kind with respect to any employee benefit plan
that is subject to Title IV of the Employee  Retirement  Income  Security Act of
1974, as amended.

     (v)  Employee  Disputes.  Except  as set  forth in  Section  3.1(v)  of the
Disclosure Schedule,  (i) neither the workers who operate the Related Assets nor
any other  employees of Working  Interest  Owner are presently  carrying out, or

                                       10
<PAGE>
threatening,  any strike, slowdown,  picketing or work stoppage, and (ii) within
the last five years there have not been any strikes, work stoppages,  slowdowns,
lockouts or other material labor disputes  involving any Working  Interest Owner
or any of its Affiliates or any of their respective employees,  or the operation
of the Related Assets.

     (w)  Transmitting  Utility.  Working  Interest Owner is not a "transmitting
utility"  as defined in Section  9.102(a)(81)  of the  Uniform  Commercial  Code
presently in effect in the State of Texas.

     (x) Insurance.  Working Interest Owner is carrying the insurance  described
on Schedule 3.7 to the  Production  and Marketing  Agreement and is otherwise in
compliance with Section 3.7 of the Production and Marketing Agreement.

     (y) No Reliance.  Working  Interest Owner (i) has made its own  independent
decision to enter into this Purchase and Sale  Agreement,  the other  Production
Payment Documents, and the transactions  contemplated herein and therein and its
own  independent  judgment as to whether such  transactions  are  appropriate or
proper for it, in each case,  based upon its own  judgment  and upon advice from
such advisers as it has deemed necessary, and in entering into such transactions
is acting for its own account, (ii) is not relying on any communication (written
or oral) of Royalty  Owner,  or of Royalty  Owner's  Affiliates,  as  investment
advice  or as a  recommendation  to  enter  into  such  transactions,  it  being
understood  that any  information  and  explanations  related  to the  terms and
conditions of such transactions  shall not be considered to be investment advice
or a  recommendation  to enter  into  such  transactions,  (iii) is  capable  of
assessing  the  merits  of and  understanding  (on its  own  behalf  or  through
independent  professional  advice),  and  understands  and accepts the terms and
conditions and risks of, such transactions and is also capable of assuming,  and
assumes,  such  risks,  and (iv)  acknowledges  that  Royalty  Owner and Royalty
Owner's  Affiliates  are not,  and are not  acting  as, an  adviser  to  Working
Interest  Owner  in  respect  of  such   transactions  with  respect  to  legal,
regulatory,  accounting,  taxation,  financial  or  any  other  matters  in  any
jurisdiction.

     Section 3.2 Use of Proceeds.  Working  Interest  Owner  warrants and agrees
that it will  use  the  Purchase  Price  to pay  for  its  and  Royalty  Owner's
out-of-pocket  expenses  and  fees  relating  to the sale  and  purchase  of the
Production  Payment and to the Closing Documents as further set forth herein, to
provide for a portion of the purchase price for the Subject Interests located in
Frio County, Texas, and for general corporate purposes.

                                       11
<PAGE>
                                  ARTICLE IV.
                        REPRESENTATIONS OF ROYALTY OWNER

     Section  4.1  Representations  of  Royalty  Owner.   Royalty  Owner  hereby
represents and warrants to Working Interest Owner as follows:

     (a) Royalty Owner is a limited  liability  company duly organized,  validly
existing  and in good  standing  under  the  Laws of the  State  of  Texas.  The
execution,  delivery and  performance  of this  Agreement  and the  transactions
described  herein have been duly and validly  authorized by all necessary action
on the part of Royalty  Owner.  Royalty Owner is a "United States person" within
the meaning of Section 7701 of the Internal Revenue Code.

     (b) This Agreement has been, and as of the Closing the Closing Documents to
which Royalty Owner is a signatory  will have been,  duly executed and delivered
by or on behalf of Royalty  Owner.  This  Agreement  constitutes,  and as of the
Closing  each of the Closing  Documents to which  Royalty  Owner is a party will
constitute,   the  legal,  valid  and  binding   obligations  of  Royalty  Owner
enforceable  against  Royalty  Owner  in  accordance  with its  terms,  subject,
however, to bankruptcy,  insolvency,  reorganization,  moratorium and other Laws
affecting creditors' rights generally and to general principles of equity.

     (c) Royalty Owner is acquiring the  Production  Payment for its own account
and not with any intention to transfer all or any part of the Production Payment
to others in violation of the Securities Act of 1933, as amended.

                                   ARTICLE V.
                              CONDITIONS TO CLOSING

     Section 5.1  Conditions  to  Obligations  of Working  Interest  Owner.  The
obligation of Working  Interest  Owner to proceed with the Closing is subject to
the  satisfaction,  on or prior to the  Closing  Date,  of all of the  following
conditions  precedent,  provided that any one or more of such  conditions may be
waived in whole or in part in writing by Working Interest Owner:

     (a)  Royalty  Owner  shall have  performed  all  covenants  and  agreements
required to be performed by it hereunder at or prior to the Closing, and

     (b) Each of Royalty  Owner's  representations  and warranties  contained in
Article IV hereof  shall be true and correct on and as of the Closing Date as if
made on such date.

                                       12
<PAGE>
     Section 5.2 Conditions to  Obligations of Royalty Owner.  The obligation of
Royalty Owner to proceed with the Closing is subject to the  satisfaction  on or
prior to the Closing Date of all of the following conditions precedent, provided
that any one or more of such  conditions  may be  waived  in whole or in part in
writing by Royalty Owner:

     (a)  Working   Interest  Owner  shall  have  performed  all  covenants  and
agreements  required to be performed by it hereunder at or prior to the Closing,
and each of the representations  and warranties  contained in Article III hereof
or in any of the other Closing  Documents shall be true and correct on and as of
the Closing Date as if made on such date.

     (b) The  consummation  of the  Closing  on the  Closing  Date  shall not be
prohibited  by any  applicable  Law or any  applicable  order or  decree  of any
federal or state court or agency having competent jurisdiction.  No suit, action
or other  proceeding  shall be pending (i) that could have any adverse effect on
the Related  Assets or the value of the Related  Assets or any adverse effect on
the value of the Production Payment, (ii) in which there is sought any remedy to
restrain,  enjoin or otherwise prevent the consummation of this Agreement or the
transactions  contemplated  in  connection  herewith,  or  (iii)  in  which  any
allegation is made that this Agreement or any of the  transactions  contemplated
hereby is in violation of any Lease,  indenture,  bank loan,  credit  agreement,
farmout agreement,  program agreement,  unit agreement,  operating agreement, or
other  agreement or instrument to which Working  Interest Owner is a party or by
which Working  Interest  Owner or Working  Interest  Owner's  properties  may be
currently bound or affected.

     (c) The sellers under the Ricochet PSA Agreement shall have assigned to the
Working  Interest  Owner the Subject  Interests in Frio County,  Texas,  and the
transactions  contemplated by the Ricochet PSA shall be closed concurrently with
the transactions contemplated by this Agreement.

     (d) Royalty  Owner shall have  received  copies of (i) all of the documents
and  instruments  referred  to in  the  Disclosure  Schedule  hereto,  (ii)  all
consents,  waivers of preferential purchase rights, and advance notices that are
referred  to in  Section  3.1(c),  (iii)  all  operating  agreements  and  other
agreements and instruments relating to Permitted  Encumbrances that are referred
to in Section 3.1(s), and (iv) any other Subject Contracts  requested by Royalty
Owner; and all of the foregoing shall be in full force and effect.

     (e) Royalty Owner, in Royalty Owner's sole  discretion,  shall be satisfied
with the  results  of any  engineering,  environmental  or other  review  of the
Related  Assets that it chooses to undertake,  any due  diligence  investigation
with   respect  to  the   matters   addressed   by  Working   Interest   Owner's
representations and warranties in the Production Payment Documents, and with all
legal matters related to the transactions contemplated in the Production Payment
Documents,  including  the status of the  consents  and  amendments  obtained by
Royalty  Owner  with  respect  to  Working  Interest  Owner's  loan  agreements,
mortgages and indentures.

                                       13
<PAGE>
     (f) Royalty Owner shall have received title opinions, in form and substance
reasonably  acceptable to it, landman  reports or other title  information  with
respect to title to the Subject Interests as may be requested by Royalty Owner.

     (g) Royalty  Owner shall have  received  certificates  from the  applicable
public  officials of the State of Texas showing that Working  Interest  Owner is
organized, validly existing and in good standing under the Laws of such state.

     (h) Royalty Owner shall have received insurance  certificates  establishing
that Working  Interest Owner is in compliance  with the  requirements of Section
3.7 of the Production and Marketing Agreement.

     (i) Royalty Owner shall have received a Certification of Non-Foreign Status
from Working  Interest  Owner,  substantially  in the form attached as Exhibit A
hereto.

     (j) Working  Interest  Owner shall have paid, or reimbursed  Royalty Owner,
for the out-of-pocket costs and expenses incurred by Royalty Owner in connection
with its retention of legal  counsel and  environmental,  engineering  and other
professionals  to assist  with its due  diligence  investigation  of the Subject
Interests and the negotiation and preparation of the Transaction Documents.

     (k) The transactions contemplated by the Credit Agreement,  dated as of the
date hereof,  among the Working  Interest Owner,  the Parent,  the lenders party
thereto,  and Petro Capital Energy Credit, LLC, as administrative agent for such
lenders,  shall have closed  concurrently with the transactions  contemplated by
this Agreement.

                                  ARTICLE VI.
                                    CLOSING

     Section 6.1 Place of Closing.  The Closing will occur at 9:00 a.m. (Dallas,
Texas,  Time) at the offices of Condon  Thornton  Sladek Harrell PLLC in Dallas,
Texas,  on July 28,  2014,  or at such other place and time as Working  Interest
Owner and Royalty Owner may specify.

     Section 6.2  Closing  Documents.  At or before the  Closing  the  following
instruments  shall  be  duly  executed  and  acknowledged,  as  applicable,  and
delivered,  each in form and substance satisfactory to Royalty Owner in its sole
discretion  and in such  numbers of  counterparts  as may be requested by either
Party:

     (a)  Counterparts of the Conveyance,  executed by Royalty Owner and Working
Interest Owner.

     (b) Counterparts of the (i) Production and Marketing Agreement, executed by
Royalty Owner and Working Interest Owner and (ii) the Parent Guaranty  Agreement
executed by the Parent.

     (c) Counterparts of the Mortgage, executed by Working Interest Owner.

                                       14
<PAGE>
     (d) Legal opinions to Royalty Owner, in form and substance  satisfactory to
Royalty Owner, from Stewart & Bonnet,  LLP, special counsel for Working Interest
Owner, and Lionel Sawyer & Collins,  special counsel for the Parent,  as set out
on  Exhibits  B-1  and  B-2  hereto  (with  such   additional   assumptions  and
qualifications as may be acceptable to Royalty Owner).

     (e) A certificate of a senior  executive  officer of Working Interest Owner
given to Royalty Owner, dated as of the Closing Date, certifying (to the best of
his knowledge,  after due inquiry) as to the matters specified in Section 5.2(a)
and (b).

     (f) Certificates of a senior  executive  officer of Working Interest Owner,
given to Royalty  Owner,  containing the names and signatures of the officers of
Working  Interest  Owner  authorized  to execute the Closing  Documents to which
Working  Interest Owner is a party and certifying to the truth,  correctness and
completeness  of  the  following  exhibits  attached  thereto:  (i)  a  copy  of
resolutions or written consents duly adopted by the Board of Directors,  members
or managers,  as  applicable,  of Working  Interest  Owner and in full force and
effect at the Closing Date,  authorizing the execution of the Closing  Documents
to  which  Working  Interest  Owner  is a  party  and  the  consummation  of the
transactions  contemplated  therein, and (ii) a copy of the charter documents of
such  company and all  amendments  thereto,  certified,  as  applicable,  by the
appropriate official of the appropriate state of organization.

     (g) Certificates of a senior executive officer of Parent,  given to Royalty
Owner,  containing the names and signatures of the officers of Parent authorized
to execute the Closing  Documents to which Parent is a party and  certifying  to
the truth,  correctness  and  completeness  of the following  exhibits  attached
thereto: (i) a copy of resolutions or written consents duly adopted by the Board
of Directors,  members or managers,  as applicable,  of Parent and in full force
and  effect at the  Closing  Date,  authorizing  the  execution  of the  Closing
Documents to which Parent is a party and the  consummation  of the  transactions
contemplated  therein,  and (ii) a copy of the charter documents of such company
and  all  amendments  thereto,  certified,  as  applicable,  by the  appropriate
official of the appropriate state of organization.

     (h) Such  other  documents  as  Royalty  Owner may  reasonably  specify  to
effectuate  the  conveyance of the  Production  Payment to Royalty Owner and the
other transactions contemplated herein and in the other Closing Documents.

     Section 6.3 Preclosing and Funding. The Conveyance and the Mortgage will be
executed  prior  to  the  Closing  and  shall  be  delivered  to  Royalty  Owner
contemporaneously  with  the  funding  described  below  and  recorded  promptly
thereafter.  After receipt of such  documents  and the other items  described in
Sections 5.2 and 6.2, the Closing will be completed as follows:

                                       15
<PAGE>
     (a) Working Interest Owner will irrevocably authorize, and Working Interest
Owner does hereby irrevocably authorize, Royalty Owner to accept delivery of the
Conveyance and the Mortgage  concurrently  with Royalty  Owner's  sending of the
wire transfer  described in Schedule 6.3 and to file such instruments for record
thereafter,  and Royalty Owner will pay the Purchase  Price to Working  Interest
Owner by wire transfer of immediately  available funds in the amounts and to the
accounts set out on Schedule 6.3.

     (b) The Parties will take such other actions and make such other deliveries
of documents as Royalty Owner deems  necessary or  appropriate to effectuate the
conveyance of the Production Payment to Royalty Owner and the other transactions
contemplated herein and in the other Closing Documents.

     (c)  Concurrently  with the Closing,  Royalty Owner or its  Affiliates  may
execute such commodity price hedges,  interest rate hedges,  or other derivative
transactions  as  Royalty  Owner  deems   appropriate  in  connection  with  the
Production Payment, the marketing of the Production Payment Hydrocarbons and the
calculation of the final Purchase Price.

                                  ARTICLE VII.
                                 MISCELLANEOUS

     Section 7.1  Announcements;  Confidentiality;  Patriot  Act. (a) Each Party
covenants and agrees with the other that,  subject to applicable Law, each Party
will promptly  advise and consult with the other and obtain the other's  written
consent  before  issuing any press  release or other  public  announcement  with
respect  to this  Agreement  or the  transactions  described  herein;  provided,
however,  that if either Party  believes  that such release or  announcement  is
required by applicable  Laws or by a court or agency having  jurisdiction,  such
Party may make such  release or  announcement  after it has used its  reasonable
efforts to give the other Party written notice thereof, has provided the text of
such release or  announcement  to the other Party,  and has  permitted the other
Party  reasonable  opportunity  to  review  and  comment  upon such  release  or
announcement.  Each  Party will hold in  confidence  this  Agreement,  the other
Production  Payment Documents (except to the extent recorded in public records),
and any  confidential  information it has obtained from another Party,  provided
that disclosure  thereof is permitted:  (i) to the lenders,  hedge providers and
investors  of any Party or any  partner  or member of any such  Party and to the
Affiliates  of any such Party,  lender,  hedge  provider,  investor,  partner or
member,  (ii) to the  officers,  employees,  agents,  consultants,  auditors and
attorneys  of any Party or any Person  described  in the  preceding  clause (i),
(iii) in the course of any arbitration, trial, or other legal proceeding between
any of the Parties or any partner or member of any such  Party,  their  lenders,
hedge  providers or investors,  or the  Affiliates  of any such Party,  partner,
member, lender, hedge provider, or investor, (iv) to the extent legally required

                                       16
<PAGE>
to be disclosed or otherwise subject to legal, judicial, arbitral, regulatory or
self-regulatory  requests for  information  or documents,  and (v) in connection
with  any  assignment  or  potential  assignment  of  such  Party's,  partner's,
member's,  lender's,  hedge provider's or investor's  rights (provided that each
such  assignee  or  potential  assignee is made aware that such  information  is
required to be held in confidence).

     (b) Each Party  notifies the other Party that,  to the extent the notifying
Party is subject to the USA  PATRIOT  Act (Title III of Pub.  L.  107-56),  such
notifying  Party is  required  to obtain,  verify and  record  information  that
identifies  the other Party,  including  the other  Party's name and address and
other information that will allow such the notifying Party to identify the other
Party in accordance with such Act.

     Section  7.2  Survival.   The   representations,   warranties,   covenants,
agreements and indemnities in this Agreement and the Closing Documents and other
Production  Payment  Documents will survive the Closing and the  consummation of
the transactions described herein and therein.

     Section  7.3  Expenses.  Working  Interest  Owner  will  from time to time,
promptly  on  demand,  reimburse  Royalty  Owner for its  expenses  incurred  in
connection with pursuing the transactions  contemplated herein, including all of
Royalty  Owner's  legal  and  title  fees  and  expenses,  engineering  fees and
expenses,  environmental audit fees and expenses and other professional fees and
expenses  incurred by Royalty Owner or its  Affiliates  in  connection  with due
diligence  review and the  preparation,  review,  negotiation or delivery of all
documents  for  such  transactions  (whether  or  not  any  such  documents  are
executed),  including  any term  sheet or  mandate or  commitment  letter,  this
Agreement,  the Closing Documents,  the other Production Payment Documents,  and
any and all  proposed  supplements,  amendments  or  waivers  from  time to time
prepared  with  respect to this  Agreement,  the  Closing  Documents,  the other
Production  Payment  Documents,  and the  transactions  contemplated  herein and
therein.  WORKING INTEREST OWNER SHALL INDEMNIFY AND HOLD HARMLESS ROYALTY OWNER
FROM AND AGAINST ANY AND ALL LIABILITY FOR ANY BROKERS' OR FINDERS' FEES ARISING
WITH RESPECT TO BROKERS OR FINDERS RETAINED OR ENGAGED BY WORKING INTEREST OWNER
OR WORKING INTEREST OWNER'S AFFILIATES IN RESPECT OF THE TRANSACTIONS  DESCRIBED
HEREIN  AND  THEREIN.  In the event  that the  Closing  does not  occur  Working
Interest  Owner shall promptly  reimburse  Royalty Owner for any loss or expense
resulting from reversing or terminating any commodity price hedge, interest rate
hedge, or other derivative transactions described at the end of Section 6.3.

     Section 7.4 Notices. All notices, requests, demands, instructions and other
communications  required or permitted  to be given  hereunder or under the other
Production   Payment  Documents  must  be  in  writing  and  must  be  delivered

                                       17
<PAGE>
personally,  mailed by  certified  mail,  postage  prepaid  and  return  receipt
requested, sent by telecopier, or sent by email confirmed by another writing, to
the Parties as follows:

To Royalty Owner, addressed to:         To Working Interest Owner, addressed to:
------------------------------          ----------------------------------------

PCEC Sub 1, LLC                         Baron Production LLC
3710 Rawlins Street, Suite 1000         300 S CM Allen Pkwy, Suite 400
Dallas, Texas 75219                     San Marcos, Texas 78666
Attention: Rosser C. Newton             Attention: Chief Financial Officer
Fax No.: (214) 661-7760                 Fax No.: (512) 392-5775
Phone No.: (214) 661-7761               Phone No.: (512) 392-7238

with a copy to:                         with a copy to:

Condon Thornton Sladek Harrell PLLC     Corporate Legal, LLC
8080 Park Lane, Suite 700               12354 E. Caley Ave. Suite 201
Dallas, Texas 75231                     Centennial, CO 80111
Attention: Mark Knowles                 Attention: Gordon Dihle
Fax No.:  (214) 691-6311                Fax No.: (303) 974-5587
Phone No.:  (214) 691-6316              Phone No.: (720) 458-4123

Each Party may designate for itself a new or different address by written notice
to  the  other.  In  addition,  a  copy  of  all  notices,  requests,   demands,
instructions and other  communications given under this Section will be provided
to any mortgagee of the Production  Payment that is from time to time designated
by Royalty  Owner or that from time to time  requests  such copies from  Working
Interest Owner. All notices given by personal delivery or mail will be effective
on the date of  actual  receipt  at the  appropriate  address.  Notice  given by
telecopier  or email will be effective  upon actual  receipt if received  during
recipient's  normal  business hours or at the beginning of the next Business Day
after receipt if received after the recipient's normal business hours.

     Section  7.5  Governing  Law.  THIS  AGREEMENT  SHALL  BE  GOVERNED  BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

     Section 7.6 Successors and Assigns. This Agreement will be binding upon the
Parties hereto and their  respective  successors and assigns and, subject to the
restrictions  set forth in Section  1.8 of the  Conveyance,  shall  inure to the
benefit of the Parties and their  respective  successors and permitted  assigns.
Nothing  contained herein or in the other Production  Payment  Documents will in
any way limit or  restrict  the  right of  Royalty  Owner,  or  Royalty  Owner's
successors and assigns, to transfer, assign or pledge their respective rights or
obligations hereunder and under the other Production Payment Documents, in whole
or in part.  Working  Interest  Owner  will not  transfer,  assign or pledge its

                                       18
<PAGE>
rights or obligations  hereunder or under the other Production Payment Documents
without the prior written consent of Royalty Owner.

     Section 7.7 Entire Agreement;  Amendments;  Waivers. This Agreement and the
other Closing Documents and Production  Payment Documents  constitute the entire
agreement between the Parties with respect to the transactions  described herein
and   supersede   all   prior   negotiations,    discussions,   agreements   and
understandings,  whether oral or written,  relating to such subject matter. This
Agreement may not be amended or modified, and no rights hereunder may be waived,
except  by a  written  document  signed  by the  Party to be  charged  with such
amendment,  modification  or waiver.  Provisions of this Agreement that refer to
any consent, approval, amendment or waiver by either Party require such consent,
approval,  amendment  or  waiver  to be in  writing.  No  waiver  of  any of the
provisions of this  Agreement will  constitute a waiver of any other  provisions
hereof  (whether or not  similar)  nor will such waiver  constitute a continuing
waiver unless otherwise expressly provided.  Each Party acknowledges that it has
read and  understands  the  terms of this  Agreement  and the  other  Production
Payment  Documents and has had the  opportunity  to consult with legal,  tax and
accounting  counsel and advisers of its choice concerning the meaning and effect
hereof and  thereof.  No Party has relied upon any other Party or its counsel or
advisers  with  respect  to the  meaning  or  effect  of any such  agreement  or
instrument.

     THIS WRITTEN AGREEMENT AND THE OTHER PRODUCTION PAYMENT DOCUMENTS REPRESENT
THE FINAL AGREEMENT  BETWEENTHE  PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

     THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

     Section 7.8  Counterparts.  This Agreement may be executed by Royalty Owner
and Working Interest Owner in any number of counterparts, each of which shall be
deemed an original instrument and all of which together shall constitute one and
the same Agreement.  Delivery of an executed  counterpart of a signature page of
this Agreement by facsimile or in electronic (i.e., "pdf" or "tif") format shall
be effective as delivery of a manually executed counterpart of this Agreement.

     Section 7.9 WAIVER OF JURY TRIAL AND OF PUNITIVE DAMAGES. EACH PARTY HEREBY
KNOWINGLY,  VOLUNTARILY,  INTENTIONALLY,  AND  IRREVOCABLY  (A)  WAIVES,  TO THE
MAXIMUM EXTENT NOT PROHIBITED BYAPPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION  BASED ON, OR DIRECTLY OR INDIRECTLY AT ANY
TIME ARISING OUT OF, UNDER OR IN  CONNECTION  WITH THIS  AGREEMENT OR ANY OF THE
OTHER PRODUCTION  PAYMENT  DOCUMENTS OR ANY TRANSACTION  CONTEMPLATED  HEREBY OR
THEREBY OR ASSOCIATED  HEREWITH OR THEREWITH;  (B) WAIVES, TO THE MAXIMUM EXTENT
NOT  PROHIBITED BY APPLICABLE  LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN
ANY SUCH LITIGATION ANY "SPECIAL DAMAGES" (AS DEFINED BELOW), (C) CERTIFIES THAT
NO OTHER PARTY AND NO  REPRESENTATIVE OR AGENT OR COUNSEL OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, OR IMPLIED THAT SUCH OTHER PARTY WOULD NOT,

                                       19
<PAGE>
IN THE EVENT OF  LITIGATION,  SEEK TO ENFORCE  THE  FOREGOING  WAIVERS,  AND (D)
ACKNOWLEDGES  THAT IT HAS BEEN INDUCEDTO  ENTER INTO THIS  AGREEMENT,  THE OTHER
PRODUCTION  PAYMENT  DOCUMENTS  AND THE  TRANSACTIONS  CONTEMPLATED  HEREBY  AND
THEREBY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS  CONTAINED
IN  THIS  SECTION.  AS  USED  IN  THIS  SECTION,  "SPECIAL  DAMAGES"  MEANS  ALL
CONSEQUENTIAL,  EXEMPLARY OR PUNITIVE DAMAGES (REGARDLESS OF HOW NAMED) BUT DOES
NOT INCLUDE ANY PAYMENTS OR FUNDS WHICH ANY PARTY HAS EXPRESSLY  PROMISED TO PAY
OR DELIVER TO ANY OTHER PARTY.

     Section 7.10 CONSENT TO JURISDICTION.  ANY LEGAL PROCEEDING  ARISING OUT OF
OR IN ANY WAY RELATED TO ANY OF THE PRODUCTION PAYMENT DOCUMENTS WILL BE BROUGHT
AND LITIGATED  EXCLUSIVELY IN THE UNITED STATES  DISTRICT COURT FOR THE NORTHERN
DISTRICT  OF  TEXAS,  TO THE  EXTENT IT HAS  SUBJECT  MATTER  JURISDICTION,  AND
OTHERWISE IN THE STATE COURTS  SITTING IN DALLAS,  TEXAS,  AND EACH PARTY AGREES
AND CONSENTS THAT SERVICE OF PROCESS MAY BE MADE UPON IT IN ANY LEGAL PROCEEDING
RELATING TO ANY OF THE PRODUCTION  PAYMENT  DOCUMENTS BY ANY MEANS ALLOWED UNDER
TEXAS OR FEDERAL LAW,  PROVIDED  THAT LEGAL  PROCEEDINGS  TO ENFORCE ANY LIEN OR
SECURITY  INTEREST GRANTED UNDER ANY PRODUCTION  PAYMENT DOCUMENT MAY BE BROUGHT
IN ANY COURT HAVING JURISDICTION OVER SUCH PROCEEDINGS. THE PARTIES HEREBY WAIVE
AND AGREE NOT TO ASSERT, BY WAY OF MOTION,  AS A DEFENSE OR OTHERWISE,  THAT ANY
SUCH PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM OR THAT THE VENUE THEREOF IS
IMPROPER,  AND FURTHER AGREE TO A TRANSFER  OFANY SUCH  PROCEEDING TO THE UNITED
STATES DISTRICT COURT FOR THE NORTHERN  DISTRICT OF TEXAS, TO THE EXTENT THAT IT
HAS  SUBJECT  MATTER  JURISDICTION,  AND  OTHERWISE  TO A STATE COURT IN DALLAS,
TEXAS. IN FURTHERANCE THEREOF, EACH PARTY HEREBY ACKNOWLEDGES AND AGREES THAT IT
WILL BE NEITHER  INCONVENIENT  NOR UNFAIR TO LITIGATE OR  OTHERWISE  RESOLVE ANY
DISPUTES OR CLAIMS IN ANY SUCH COURT.


                            [SIGNATURES ON NEXT PAGE]


                                       20
<PAGE>
     IN WITNESS OF THE FOREGOING,  Working Interest Owner and Royalty Owner have
each duly executed and delivered this Agreement.

WORKING INTEREST OWNER:

BARON PRODUCTION LLC

By:
     --------------------------------------------
Name:
     --------------------------------------------
Title:
     --------------------------------------------


                                       21
<PAGE>
ROYALTY OWNER:

PCEC SUB 1, LLC


By:
   --------------------------------------------
   Rosser C. Newton
   Vice President


                                       22
<PAGE>
                                    EXHIBIT A
                       CERTIFICATION OF NON-FOREIGN STATUS

                       CERTIFICATION OF NON-FOREIGN STATUS

     Section 1445 of the Internal  Revenue Code  provides that a transferee of a
U.S.  real property  interest  must withhold tax if the  transferor is a foreign
corporation,  foreign  partnership,  foreign trust or foreign estate.  To inform
PCEC  SUB 1,  LLC,  a  Texas  limited  liability  company  ("TRANSFEREE"),  that
withholding of tax is not required upon the  disposition of a U.S. real property
interest  owned by Baron  Production  LLC,  a Texas  limited  liability  company
("TRANSFEROR"),  the  undersigned  hereby  certifies  the following on behalf of
Transferor:

     1. Transferor is not a foreign corporation,  foreign  partnership,  foreign
trust or  foreign  estate  (as those  terms are  defined  in the  United  States
Internal Revenue Code and the Regulations thereunder);

     2. Transferor's tax identification number is ; and

     3.  Transferor's  address is 300 S. CM Allen Pkwy,  Suite 400,  San Marcos,
Texas 78666..

     The undersigned understands that this certification may be disclosed to the
     Internal  Revenue  Service  by  Transferee  and  that any  false  statement
     contained herein could be punished by fine, imprisonment or both.

     Under  penalties  of perjury,  the  undersigned  declares  that it has full
     authority to execute this certification on behalf of Transferor and that it
     has examined this certification and to the best of its knowledge and belief
     it is true, correct and complete.

     DATED this 28th day of July, 2014.


                            [SIGNATURE PAGE FOLLOWS]


                                       23
<PAGE>
                            BARON PRODUCTION LLC

                            By:
                               --------------------------------------------
                            Name:
                                 ------------------------------------------
                            Title:
                                  -----------------------------------------


                                       24
<PAGE>
                                   EXHIBIT B-1
                 FORM OF LEGAL OPINION OF STEWART & BONNETT, LLP






                                       25
<PAGE>
                                EXHIBIT B-2
                     FORM OF LEGAL OPINION OF LIONEL SAWYER & COLLINS






                                       26
<PAGE>
                                  SCHEDULE 3.1
                                       TO
                           PURCHASE AND SALE AGREEMENT
                               DISCLOSURE SCHEDULE

Section 3.1(b) Conflicts: None

Section 3.1(c) Consents, Preferential Rights and Required Notices: None

Section 3.1(d) Material Adverse Changes: None

Section 3.1(e) Governmental Approvals: None

Section 3.1(h) Full Disclosure: None

Section 3.1(j) Tax Disclosures: None

Section 3.1(n) Take or Pay, etc.: None

Section 3.1(o) Compliance with Laws: None

Section 3.1(p) No Casualties or Condemnation: None

Section 3.1(q) Litigation:: None

Section 3.1(v) Employee Disputes: None


                                       27
<PAGE>
                                  SCHEDULE 6.3
                                       TO
                           PURCHASE AND SALE AGREEMENT
                                WIRE INSTRUCTIONS

In accordance the Disbursement  Letter, dated the date hereof, among the Working
Interest Owner, the Royalty Owner, the Parent,  and Petro Capital Energy Credit,
LLC, as Administrative Agent.


                                       28