Document:

Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

THIS
AGREEMENT is made as of August 15, 2016

 

BETWEEN:

 

ZION
OIL AND GAS INC., a Company incorporated under the laws of Delaware.

 

(the
“Company”)

 

and

 

MICHAEL
B. CROSWELL, Jr.

 

(the “Employee”)

 

CONTEXT
OF THIS AGREEMENT

 

A.          The Company explores for oil and gas in Israel.

 

B.           The Company wishes to employ the Employee as the Company’s Chief Financial Officer (CFO), upon the terms and conditions as
set out herein.

 

FOR
VALUE RECEIVED, the sufficiency of which is acknowledged, the parties agree as follows:

 

PART
1

INTERPRETATION

 

1.1          Definitions.
In this Agreement, the following terms shall have the following meanings:

 

“Agreement”
means this agreement and all schedules attached hereto and all amendments made hereto and thereto in writing by the parties.

 

“Business
Day” means a day other than a Saturday, Sunday or statutory holiday in the U.S.A. and Israel.

 

“Person”
includes individuals, companies, limited partnerships, general partnerships, joint stock companies, joint ventures, associations,
companies, trusts or other organizations, whether or not legal entities.

 

1.2          Entire
Agreement. This Agreement together with the agreements and other documents to be delivered pursuant to this Agreement
(or other agreements pertaining to employee benefits, including, without limitation, stock option and bonus plan agreements),
constitute the entire agreement between the parties pertaining to the subject matter of this Agreement and supersede all
prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties and there are no
warranties, representations or other agreements between the parties in connection with the subject matter of this Agreement
except as specifically set forth in this Agreement and any document delivered pursuant to this Agreement. No supplement,
modification or waiver or termination of this Agreement shall be binding unless executed in writing by the party to be bound
thereby.

 

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1.3          Sections & Headings. The division of this Agreement into parts and sections and the insertion of headings are for convenience
of reference only and shall not affect the construction or interpretation of this Agreement. The terms “this Agreement”,
“hereof’, “hereunder” and similar expressions refer to this Agreement and not to any particular article, section
or other portion hereof and include any agreement or instrument supplemental or ancillary hereto. Unless something in the subject
matter or context is inconsistent therewith, references herein to parts and sections are to parts and sections of this Agreement.

 

1.4          Number
& Gender. Words importing the singular number only shall include the plural and vice versa and words importing the
masculine gender shall include the feminine and neuter genders and vice versa.

 

1.5          Applicable Law. This Agreement shall be construed and enforced in accordance with the laws of the United States of America,
and specifically, those of the State of Texas applicable thereto.

 

1.6          Currency. Unless
otherwise specified, all references herein to currency shall be references to currency of the United States.

 

1.7          Calculation
of Time. When calculating the period of time within which or following which any act is to be done or step taken pursuant
to this Agreement, the date which is the reference date in calculating such period shall be excluded. If the last day of such
period is a non Business Day, the period in question shall end on the next Business Day.

 

PART
2

APPOINTMENT
AND DUTIES

 

2.1          Appointment. The
Company agrees to employ the Employee as its CFO upon the terms and conditions contained herein, and the Employee
accepts such appointment.

 

2.2          Term. The
employment of the Employee hereunder shall commence effective August 15, 2016 and shall continue for an initial term
until December 31, 2017 (the “Initial Term”) unless terminated in accordance with the provisions of this Agreement.
This Agreement shall be automatically renewed for successive one (1) year terms (each a “Renewal Term”) unless the
Company or Employee indicates in writing, more than 30 days prior to the termination of this Initial term or any Renewal
term, that it does not intend to renew this Agreement.

 

2.3          Duties
& Reporting. The Employee will report directly to the Company’s Executive Vice-Chairman and its CEO and shall carry out
all duties and responsibilities which are from time to time assigned to him by the Board of Directors, the Executive Vice-Chairman
and/or its CEO.

 

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PART
3

BENEFITS
& EXPENSES

 

3.1          Gross Salary. During the term hereof, and subject to the performance of the services required to be performed hereunder
by Employee, the Company shall pay to the Employee for all services rendered hereunder, $150,000 as annual base salary, payable
not less often than once per month and in accordance with the Company’s normal and reasonable payroll practices, a monthly gross
amount equal to $12,500 (the “Gross Salary”). Upon recommendation by the Executive Vice-Chairman and/or the CEO, the
Board of Directors will review the Gross Salary annually and, in its sole discretion, consider any increases it deems warranted
at that time.

 

3.2          Intentionally omitted.

 

3.3          Vehicle. Company shall reimburse Employee for all registration, gasoline, maintenance and insurance expenses incurred for
the reasonable business use of his vehicle.

 

3.4          Cell Phone. Company shall reimburse Employee for reasonable cell phone charges.

 

3.5          Benefits. The Employee shall be entitled to fully participate in all of the Company’s benefit plans generally available
to its senior level employees from time to time, including any profit sharing plan, royalty pool, management incentive plan or
similar plan or arrangement; provided, however, nothing herein will be construed to limit, condition or otherwise encumber the
Company’s right to amend, discontinue, substitute or maintain any employee benefits plan, program or perquisite in accordance
with applicable law. Notwithstanding any other provision in this Agreement to the contrary, this Section 3.5 and the rights conferred
on Employee herein shall survive the termination or expiration of this Agreement.

 

3.6          Expenses. The Employee shall be reimbursed for ordinary, necessary and reasonable out-of-pocket trade or business expenses
incurred in connection with the performance of Employee’s duties under this Agreement, together with any applicable sales, services
and other applicable taxes as a result thereof, by the Company within fifteen (15) Business Days after presentation by the Employee
of proper invoices and receipts in keeping with the policies of the Company, as established from time to time, subject to the
reasonable approval of the Executive Vice-Chairman or CEO. The Company also authorizes business class travel when flying on overseas
flights.

 

3.7          Options. Subject to the Employee entering into the Company’s standard Employee Stock Option agreement, for services required
to be performed hereunder by Employee, the Employee shall be entitled to participate in an employee stock option plan of the Company.
Company shall grant to Employee under the Company’s 2011 and any other applicable Stock Option Plan fully vested options to purchase
10,000 shares of Common Stock of the Company during the Initial Term at a per share exercise price of $0.01 (“Vested Options”)
commencing January 5, 2017, and continuing on the fifth (5th) day of January of each applicable successive Renewal Term. In the
event that this Agreement continues after the Initial Term, the Company annually shall grant to the Employee additional stock
options which in no event shall be less than the per term amount granted herein with such other terms to be agreed upon by the
parties. All Options are subject to the terms of the written stock option agreement(s) issued by the Company.

 

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3.8          Paid Time Off/Paid Holidays. The Employee shall be entitled to paid time off (“PTO”) at the rate of twenty (20)
days for each calendar year, pro-rated as applicable for any partial calendar year and subject to the terms of the Company’s vacation
policy. PTO is meant to include all vacation, personal and sick days, and Employee shall be compensated at the usual rate of base
compensation for any PTO. Employee shall not be entitled to any additional PTO. The Employee shall also be entitled to paid Company
Holidays as generally given by the Company. Vacation days may be accumulated for two (2) years, after which they must be
used or redeemed; provided that accumulation of vacation days in excess of forty (40) days may be approved by the Board of Directors
in its discretion. Vacation days shall be prorated for any portion of a year to the date of termination.

 

3.9          Withholding Tax Company shall withhold, or charge Employee with, all taxes and other compulsory payments as required under
applicable law with respect to all payments, benefits and/or other compensation paid to Employee in connection with his employment
with Company.

 

3.10        Insurance. The Employee shall be entitled to participate in all health, dental, vision, disability and term insurance programs
offered by the Company to its employees, for which the Company will contribute up to $2,500 per month.

 

3.11        Professional Fees. The Company shall pay for or reimburse Employee for all reasonable professional license fees and/or
dues incurred by Employee for membership in appropriate accounting associations.

 

PART
4

EMPLOYEE’S
COVENANTS

 

4.1          Service. The Employee shall devote all of his business time, attention and ability to the business of the Company and shall
well and faithfully serve the Company and shall use his best efforts to promote the interests of the Company. The Employee appreciates
that the Employee’s duties may involve significant travel from the Employee’s place of employment, and the Employee agrees to
travel as reasonably required in order to fulfill the Employee’s duties.

 

4.2          Duties and Responsibilities. The Employee shall duly and diligently perform all the duties assigned to him while in the
employment of the Company, and shall truly and faithfully account for and deliver to the Company all money, securities and things
of value belonging to the Company which the Employee may from time to time receive for, from or on account of the Company.

 

4.3          Rules and Regulations. The Employee shall be bound by and shall faithfully observe and abide by all the rules and regulations
of the Company from time to time in force including insider trading policies, blackout periods for the purchase and sale of the
Company’s securities and underwriter lock ups, from time to time in force.

 

PART
5

CONFIDENTIAL
INFORMATION AND DEVELOPMENTS

 

5.1          “Confidential Information” means information, whether or not originated by the Employee, that relates to the
business or affairs of the Company, its affiliates, clients or suppliers and is confidential or proprietary to, about or created
by the Company, its affiliates, clients, or suppliers. Confidential Information includes, but is not limited to, the following
types of confidential information and other proprietary information of a similar nature (whether or not reduced to writing or
designated or marked as confidential):

 

		a)	work
                                         product resulting from or related to work or projects performed for or to be performed
                                         for the Company or its affiliates, including but not limited to, the interim and final
                                         lines of inquiry, hypotheses, research and conclusions related thereto and the methods,
                                         processes, procedures, analysis, techniques and audits used in connection therewith;

 

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		b)	computer
                                         software of any type or form and in any stage of actual or anticipated development, including
                                         but not limited to, programs and program modules, routines and subroutines, procedures,
                                         algorithms, design concepts, design specifications (design notes, annotations, documentation,
                                         flowcharts, coding sheets, and the like), source code, object code and load modules,
                                         programming, program patches and system designs;

 

		c)	information
                                         relating to developments (as hereinafter defined) prior to any public disclosure thereof,
                                         including but not limited to, the nature of the developments, production data, technical
                                         and engineering data, test data and test results, the status and details of research
                                         and development of products and services, and information regarding acquiring, protecting,
                                         enforcing and licensing proprietary rights (including patents, copyrights and trade secrets);

 

		d)	internal
                                         Company personnel and financial information, vendor names and other vendor information,
                                         purchasing and internal cost information, internal services and operational manuals,
                                         and the manner and method of conducting the Company’s business;

 

		e)	marketing
                                         and development plans, price and cost data, price and fee amounts, pricing and billing
                                         policies, quoting procedures, marketing techniques and methods of obtaining business,
                                         forecasts and forecast assumptions and volumes, and future plans and potential strategies
                                         of the Company that have been or are being discussed; and

 

		f)	all
                                         information that becomes known to the Employee as a result of employment that the Employee,
                                         acting reasonably, believes is confidential information or that the Company takes measures
                                         to protect.

 

5.2          Confidential
Information does not include:

 

		a)	the
                                         general skills and experience gained during the Employee’s employment or engagement with
                                         the Company that the Employee could reasonably have been expected to acquire in similar
                                         employment or engagements with other companies;

 

		b)	information
                                         publicly known without breach of this Agreement or similar agreements; or

 

		c)	information,
                                         the disclosure of which is required to be made by any law, regulation, governmental authority
                                         or court (to the extent of the requirement), provided that before disclosure is made,
                                         notice of the requirement is provided to the Company, and to the extent of the requirement,
                                         (to the extent reasonably possible in the circumstances) the Company is afforded an opportunity
                                         to dispute the requirement.

 

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5.3          “Developments” means all discoveries, inventions, designs, works of authorship, improvements and ideas
(whether or not patentable or copyrightable) and legally recognized proprietary rights (including, but not limited to,
patents, copyrights, trademarks, topographies, know-how and trade secrets), and all records and copies of records relating to
the foregoing, that relates solely to the Company’s business and improvements and modifications to it:

 

		a)	resulting
                                         or derived from the Employee’s employment or from the Employee’s knowledge or use of
                                         Confidential Information;

 

		b)	conceived
                                         or made by the Employee (individually or in collaboration with others) during the term
                                         of the Employee’s employment by the Company;

 

		c)	resulting
                                         from or derived from the use or application of the resources of the Company or its affiliates;
                                         or

 

		d)	relating
                                         to the business operations of or actual or demonstrably anticipated research and development
                                         by the Company or its affiliates.

 

For
greater certainty, discoveries, inventions, designs, works of authorship, improvements and ideas (whether or not patentable or
copyrightable) of the Employee that do not relate to the business of the Company are not the subject matter of this Agreement.

 

PART
6

NO
CONFLICTING OBLIGATIONS

 

6.1          The
Employee warrants to the Company that:

 

		a)	the
                                         performance of the Employee’s duties as an employee of the Company will not breach any
                                         agreement or other obligation to keep confidential the proprietary information of any
                                         other party; and

 

		b)	the
                                         Employee is not bound by any agreement with or obligation to any other party that conflicts
                                         with the Employee’s obligations as an employee of the Company or that may affect the
                                         Company’s interest in the Developments.

 

6.2          The
Employee will not, in the performance of the Employee’s duties as a Company employee:

 

		a)	improperly
                                         bring to the Company or use any trade secrets, confidential information or other proprietary
                                         information of any other party; or

 

		b)	knowingly
infringe the intellectual property rights of any other party.

 

PART 7

CONFIDENTIAL
INFORMATION 

 

7.1          Protection of Confidential Information. All Confidential Information, whether it is developed by the Employee during the
Employment Period or by others employed or engaged by or associated with the Company or its affiliates or clients, is the exclusive
and confidential property of the Company or its affiliates or clients, as the case may be, and will at all times be regarded,
treated and protected as such, as provided in this Agreement.

 

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7.2          Covenants
Respecting Confidential Information. As a consequence of the acquisition of Confidential Information, the Employee will
occupy a position of trust and confidence with respect to the affairs and business of the Company and its affiliates and
clients. In view of the foregoing, it is reasonable and necessary for the Employee to make the following covenants regarding
the Employee’s conduct during and subsequent to the Employee’s employment by the Company.

 

7.3          Non-Disclosure. At
all times during and subsequent to the Employee’s employment with the Company, the Employee will not disclose
Confidential Information to any Person (other than as necessary in carrying out the Employee’s duties on behalf of the
Company) without first obtaining the Company’s consent, and the Employee will take all reasonable precautions to prevent
inadvertent disclosure of any Confidential Information. This prohibition includes, but is not limited to, disclosing or
confirming the fact that any similarity exists between the Confidential Information and any other information.

 

7.4          Non-Competition. During
Employee’s employment with the Company and for a period of one (1) year after the termination thereof, the Employee shall
not, directly or indirectly, individually or in partnership or in conjunction with any other person or entity:

 

	 	(i)	be engaged, directly or indirectly, in any manner whatsoever
as an employee, consultant, adviser, principal, agent, member or proprietor in any business that engages in oil and gas exploration
and production in Israel and/or the Palestinian territory;
	 	 	 
	 	(ii)	be engaged, directly or indirectly, in any manner whatsoever
as an employee, consultant, adviser, principal, agent, member or proprietor in any business that engages in oil and gas exploration
and production in Israel and/or the Palestinian territory in a capacity in which the loyal and complete fulfilment of Employee’s
duties to that business would inherently require Employee’s use, copying or transferring Confidential Information; or
	 	 	 
	 	(iii)	advise, invest in, lend money to, guarantee the debts
or obligations of, or otherwise have any other financial or other interest (including an interest by way of royalty or other compensation
arrangements) in or in respect of any person or entity which carries on an oil and gas exploration and production business in
Israel and/or the Palestinian territory.

 

7.5          Using, Copying, etc. At all times during and subsequent to the Employee’s employment with the Company, the Employee will
not use, copy, transfer or destroy any Confidential Information (other than as necessary in carrying out the Employee’s duties
on behalf of the Company) without first obtaining the Company’s consent, and the Employee will take all reasonable precautions
to prevent inadvertent use, copying, transfer or destruction of any Confidential Information. This prohibition includes, but is
not limited to, licensing or otherwise exploiting, directly or indirectly, any products or services that embody or are derived
from Confidential Information or exercising judgment or performing analysis based upon knowledge of Confidential Information.

 

7.6          Return of Confidential Information. Within two (2) Business Days after the termination of the Employee’s employment on
any basis and of receipt by the Employee of the Company’s written request, the Employee will promptly deliver to the Company all
property of or belonging to or administered by Company including without limitation all Confidential Information that is embodied
in any physical or ephemeral form, whether in hard copy or on magnetic media, and that is within the Employee’s possession or
under the Employee’s control.

 

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7.7          Obligations Continue. The Employee’s obligations under this Part 7 are to remain in effect in perpetuity unless provided
otherwise herein.

 

PART
8

INTELLECTUAL
PROPERTY

 

8.1          Ownership. All Developments will be the exclusive property of the Company, and the Company will have sole discretion to
deal with Developments. For greater certainty, all work done during the Employment Period by the Employee for the Company or its
affiliates is a work for hire of which the Company or its affiliate, as the case may be, is the first author for copyright purposes
and in respect of which all copyright will vest in the Company or the relevant affiliate, as the case maybe.

 

8.2          Records. The Employee will keep complete, accurate and authentic notes, reference materials, data and records of all Developments
in the manner and form requested by the Company. All these materials will be Confidential Information upon their creation.

 

8.3          Moral
Rights. The Employee hereby irrevocably waives all moral rights arising under statute in any jurisdiction or under common
law which the employee may have now or in the future with respect to the Developments, including, without limitation, any
rights the Employee may have to have the Employee’s name associated with the Developments or to have the Employee’s name not
associated with the Developments, any rights the Employee may have to prevent the alteration, translation or destruction of
the Developments, and any rights the Employee may have to control the use of the Developments in association with any
product, service, cause or institution. The Employee agrees that this waiver may be invoked by the Company, and by any of its
authorized agents or assignees, in respect of any or all of the Developments and that the Company may assign the benefit of
this waiver to any Person.

 

8.4          Further Assurances. The Employee will do all further things that may be reasonably necessary or desirable in order to give
full effect to the foregoing. If the Employee’s co-operation is required in order for the Company to obtain or enforce legal protection
of the Developments following the termination of the Employee’s employment, the Employee will provide that cooperation so long
as the Company pays to the Employee reasonable compensation for the Employee’s time at a rate to be agreed, provided that the
rate will not be less than the last base salary or compensation rate paid to the Employee by the Company during the Employee’s
employment.

 

8.5          Obligations
Continue. The Employee’s obligations under this Part 8 are to remain in effect in perpetuity.

 

PART
9

CONSENT
TO ENFORCEMENT

 

The
Employee confirms that all restrictions in Part 7 and 8 are reasonable and valid, and all defenses to the strict enforcement
thereof by the Company are waived by the Employee. Without limiting the generality of the foregoing, the Employee hereby
consents to an injunction being granted by a court of competent jurisdiction in the event that the Employee is in any breach
of any of the provisions stipulated in Part 7 and 8. The Employee hereby expressly acknowledges and agrees that injunctive
relief is an appropriate and fair remedy in the event of a breach of any of the said provisions.

 

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PART
10

WARRANTIES,
COVENANTS AND REMEDIES

 

10.1        The obligations of the Employee as set forth in Parts 6 through 9 will be deemed to have commenced as of the date on which
the Employee was first employed by Company. The Employee warrants that the Employee has not, to date, breached any of the obligations
set forth in any of those Sections. Any breach or threatened breach of those sections by the Employee will constitute Just Cause
for immediate termination of the Employee’s employment or engagement by the Company.

 

10.2        The Employee understands that the Company has expended significant financial resources in developing its products and the Confidential
Information. Accordingly, a breach or threatened breach by the Employee of any of Parts 6 through 9 could result in unfair competition
with the Company and could result in the Company and its shareholders suffering irreparable harm that is not capable of being
calculated and that cannot be fully or adequately compensated by the recovery of damages alone. Accordingly, the Employee agrees
that the Company will be entitled to interim and permanent injunctive relief, specific performance and other equitable remedies,
in addition to any other relief to which the Company may become entitled.

 

10.3     
  The Employee’s obligations under each of Parts 6 through 9 are to remain in effect in accordance with each
of their terms and will exist and continue in full force and effect despite any breach or repudiation of this Agreement or
the Employee’s employment (including, without limitation, the Employee’s wrongful dismissal) by the
Company.

 

PART
11

TERMINATION

 

11.1        Termination
by the Employee. The Employee may terminate this Agreement upon 60 Business Days prior written notice given by the Employee
to the Company. The Company, at its sole discretion, may elect to accept the 60 Business Days written notice or to reduce or eliminate
the notice period. In such event, the Employee’s employment shall terminate on the earlier day elected by the Company. Such
election on the part of the Company will not alter the nature of the termination as voluntary, and the Company will not be required
to pay any severance or termination payments in respect of a termination by the Employee under this Section 11.1. Upon the termination
of employment by the Employee under this Section 11.1, the Company shall pay to the Employee all bonuses and other benefits earned
or accrued up to the date of termination, but otherwise all obligations of the Company under this Agreement shall end.

 

11.2        Definition of “Just Cause”. “Just Cause” means:

 

(i)
Employee’s conviction of, or plea of nolo contendere, to any felony or to a crime involving moral depravity or fraud; (ii)
Employee’s commission of an act of dishonesty or fraud or breach of fiduciary duty or act that has a material adverse effect
on the name or public image of the Company, as determined by the Board, provided the Board affords the Employee the opportunity
to personally appear before the Board in order to state his case prior to the Board voting to so terminate the Employee; (iii)
Employee’s commission of an act of willful misconduct or gross negligence, as determined by the Board provided the Employee
shall have the opportunity to state his case before the Board prior to the Board taking such decision to so terminate the Employee;
(iv) the failure of Employee to perform his duties under this Agreement; (v) the material breach of any of Employee’s material
obligations under this Agreement; (vi) the failure of Employee to follow a directive of the Executive Chairman or the Board; or
(vii) excessive absenteeism, chronic alcoholism or any other form of addiction that prevents Employee from performing the essential
functions of his position with or without a reasonable accommodation; provided, however, that the Company may terminate
Employee’s employment for Just Cause, as to (iv) or (v) above, only after failure by Employee to correct or cure, or to
commence or to continue to pursue the correction or curing of, such conduct or omission within ten (10) days after receipt by
Employee of written notice by the Company of each specific claim of any such misconduct or failure.

 

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11.3        Termination
by the Company for Just Cause. The Company may terminate this Agreement at any time for Just Cause without notice and (except
as provided in the immediately following sentence) without payment of any compensation by way of anticipated earnings, damages,
or other relief of any kind whatsoever. Upon the termination of employment by the Company for Just Cause, the Company shall pay
to the Employee all salaries, bonuses, vacation and other benefits, if any, earned or accrued up to the date of termination, but
otherwise all obligations of the Company under this Agreement end.

 

11.4        Termination by the Company for Other Than Just Cause. The Company may terminate this Agreement at any time for other than
Just Cause upon the following terms:

 

		(a)	if
                                         the Company so terminates this Agreement at any time during the Initial Term of this
                                         Agreement, the Company shall pay to the Employee an amount equal to the base salary then
                                         payable, if any, for the longer of (a) the period from the date of such termination to
                                         the end of the Initial Term as if the Agreement had not been so terminated or (b) twelve
                                         months, and in all cases, subject to the deductions in Section 3.9;

 

		(b)	if
                                         the Company so terminates this Agreement after the Initial Term or during a Renewal Term,
                                         the Company shall pay the Employee an amount equal to the base salary, if any, then payable
                                         to the Employee for a period of twelve months as if the Agreement had not been so terminated
                                         or had been renewed, subject to the deductions in Section 3.9; and

 

		(c)	upon
                                         any such termination, all bonuses or other benefits earned or accrued up to the date
                                         of termination or expiry shall be paid by the Company, but except for such payments and
                                         the payments to be made pursuant to Sections 11.4(a) or (b), as applicable, all obligations
                                         of the Company under this Agreement shall end upon such termination or failure to renew.
                                         Payments under Sections 11.4(a) or (b) shall be payable monthly subject to deductions
                                         in Section 3.9.

 

11.5        Termination by the Employee for Good Reason. The Employee may terminate this Agreement at any time upon the occurrence
of any of the following events (each a “Good Reason”), if such occurrence takes place without the express written
consent of the Employee:

 

	 	a)	a change in the Employee’s title or position or a material
diminution in the Employee’s duties or the assignment to the Employee of duties which materially impairs the Employee’s ability
to function in his current capacity for the Company, or, with respect to an assignment of duties only, is materially inconsistent
with his duties; and

 

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	 	b)	any material change in the Employee’s direct reporting
obligations.

 

In
the event that the Employee terminates this Agreement for Good Reason, he shall be entitled to the same payments and benefits
as provided in Section 11.4 of this Agreement as if the Company had terminated this Agreement at the time that the Employee terminates
this Agreement under this Section 11.5.

 

11.6        Full and Final Release. In order to be eligible for the payments as set forth in this Section 11 the Employee must (i)
execute and deliver to the Company a general release, in a form satisfactory to the Company and Employee, and (ii) be and remain
in full compliance with his obligations under this Agreement.

 

11.7        Fair and Reasonable. The parties confirm that the provisions contained in Sections 11.4 and 11.5 are fair and reasonable
and that all such payments shall be in full satisfaction of all claims which the Employee may otherwise have at law against the
Company including, or in equity by virtue of such termination of employment.

 

11.8        Return of Property. Upon the termination of the Employee’s employment for any reason whatsoever, the Employee shall at
once deliver or cause to be delivered to the Company all books, documents, effects, money, computer equipment, computer storage
media, securities or other property belonging to the Company or for which the Company is liable to others, which are in the possession,
charge, control or custody of the Employee.

 

11.9        Provisions Which Operate Following Termination. Notwithstanding any termination of this Agreement for any reason whatsoever,
provisions of this Agreement necessary to give efficacy thereto shall continue in full force and effect.

 

PART
12

GENERAL

 

12.1        Benefit
& Binding. This Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns
of the parties hereto.

 

12.2        Amendments & Waivers. No amendment to this Agreement shall be valid or binding unless set forth in writing and duly
executed by all of the parties hereto. No waiver of any breach of any provision of this Agreement shall be effective or binding
unless made in writing and signed by the party purporting to give the same and, unless otherwise provided in the written waiver,
shall be limited to the specific breach waived.

 

12.3        Time.
Time shall be of the essence of this Agreement.

 

12.4        Assignment. Neither this Agreement nor the rights and obligations hereunder shall be assignable by either party without
the consent of the other.

 

12.5        Severability. If
any provision of this Agreement is determined to be invalid or unenforceable in whole or in part, such invalidity or
unenforceability shall attach only to such provision and all other provisions hereof shall continue in full force and
effect.

 

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12.6        Attornment. For the purposes of all legal proceedings this Agreement shall be deemed to have been performed in the State
of Texas and the courts of Dallas County shall have jurisdiction to entertain any action arising under this Agreement.

 

PART
13

ACKNOWLEDGEMENT

 

The
Employee acknowledges that:

 

		a)	the
                                         Employee has received a copy of this Agreement;

 

		b)	the
                                         Employee has had sufficient time to review and consider this Agreement thoroughly;

 

		c)	the
                                         Employee has read and understands the terms of this Agreement and his obligations under
                                         this Agreement;

 

		d)	the
                                         restrictions placed upon the Employee by this Agreement are reasonably necessary to protect
                                         the Company’s proprietary interests in the Confidential Information and the Developments
                                         and will not preclude the Employee from being gainfully employed in a suitable capacity
                                         following the termination of the Employee’s employment, given the Employee’s knowledge
                                         and experience;

 

		e)	the
                                         Employee has been given an opportunity to obtain independent legal advice, or such other
                                         advice as the Employee may desire, concerning the interpretation and effect of this Agreement
                                         and by signing this Agreement the Employee has either obtained advice or voluntarily
                                         waived the Employee’s opportunity to receive the same; and

 

	 	f)	this Agreement is entered into voluntarily by the Employee.

 

PART
14

NOTICES

 

Any
demand, notice or other communication (the “Notice”) to be given in connection with this Agreement shall be given
in writing on a Business Day and may be given by personal delivery or by transmittal by facsimile addressed to the recipient as
follows:

 

	To
    the Company:	Attention: Executive Vice-Chairman
	 	Email: dustin.guinn@zionoil.com
	 	 
	To the Employee:	Email: mike.croswell@zionoil.com

 

or
such other address or facsimile number as may be designated by notice by any party to the other. Any Notice given by personal
delivery will be deemed to have been given on the day of actual delivery and if transmitted by facsimile before 3:00 pm on a Business
Day, will be deemed to have been given on that Business Day and if transmitted by facsimile after 3:00 pm on a Business Day, will
be deemed to have been given on the next Business Day after the date of transmission.

 

    	 	Page 12 of 13	 

     

    

 

PART
15

FURTHER
ASSURANCES

 

The
parties shall trom time to time execute and deliver all such further documents and do all acts and things as the other party may
reasonably require to effectively carry out or better evidence or perfect the full intent and meaning of this Agreement.

 

PART
16

FAX
SIGNATURES

 

This
Agreement may be signed either by original signature or by facsimile signature.

 

PART
17

COUNTERPARTS

 

This
Agreement may be executed by the parties in one or more counterparts, each of which when so executed and delivered shall be an
original and such counterparts shall together constitute one and the same instrument.

 

IN
WITNESS WHEREOF the parties have duly executed this Agreement.

  

	 	ZION OIL & GAS, INC.
	 	 	 
	 	By	/s/ DUSTIN GUINN
	 	 	DUSTIN GUINN
	 	 	EXECUTIVE VICE CHAIRMAN

 

	 	By	/s/ MICHAEL B. CROSWELL JR
	 	 	MICHAEL B. CROSWELL JR

 

 

Page
13 of 13EX-10.1

 Exhibit 10.1 

J.P. MORGAN SECURITIES LLC 

PURCHASE AGREEMENT 
 CALLON
PETROLEUM COMPANY 
 6.125% Senior Notes due 2024 

Purchase Agreement 
 September 15,
2016 
 J.P. Morgan Securities LLC 
 As Representative of the

 several Initial Purchasers 

listed in Schedule I hereto 
 c/o J.P. Morgan
Securities LLC 
 383 Madison Avenue 
 New York, New York 10179

 Ladies and Gentlemen: 
 Callon Petroleum
Company, a Delaware corporation (the “Company”), proposes to issue and sell to the several initial purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for whom you are acting as representative (the
“Representative”), $400,000,000 principal amount of its 6.125% Senior Notes due 2024 (the “Securities”). The Securities will be issued pursuant to an Indenture to be dated as of October 3, 2016 (the
“Indenture”), among the Company, the guarantors listed in Schedule 2 hereto (the “Guarantors”) and U.S. Bank National Association, as trustee (the “Trustee”), and will be guaranteed on an unsecured
senior basis by the Guarantors (the “Guarantees”).
 If one entity is listed on Schedule 2 hereto, all references to
Guarantors shall refer only to Callon Petroleum Operating Company, and all references to Guarantees shall refer to a Guarantee by Callon Petroleum Operating Company.

The Securities will be sold to the Initial Purchasers without being registered under the Securities Act of 1933, as amended (the
“Securities Act”), in reliance upon an exemption therefrom. The Company and the Guarantors have prepared a preliminary offering memorandum dated September 12, 2016 (the “Preliminary Offering Memorandum”) and
will prepare an offering memorandum dated the date hereof (the “Offering Memorandum”) setting forth information concerning the Company, the Guarantors and the Securities. Copies of the Preliminary Offering Memorandum have been,
and copies of the Offering Memorandum will be, delivered by the Company to the 

 
Initial Purchasers pursuant to the terms of this purchase agreement (the “Agreement”). The Company hereby confirms that it has authorized the use of the Preliminary Offering
Memorandum, the other Time of Sale Information (as defined below) and the Offering Memorandum in connection with the offering and resale of the Securities by the Initial Purchasers in the manner contemplated by this Agreement. Capitalized terms
used but not defined herein shall have the meanings given to such terms in the Preliminary Offering Memorandum. References herein to the Preliminary Offering Memorandum, the Time of Sale Information and the Offering Memorandum shall be deemed
to refer to and include any document incorporated by reference therein and any reference to “amend,” “amendment” or “supplement” with respect to the Preliminary Offering Memorandum or the Offering Memorandum shall be
deemed to refer to and include any documents filed after such date and incorporated by reference therein.
 At or prior to the Time of Sale
(as defined below), the Company had prepared the following information (collectively, the “Time of Sale Information”): the Preliminary Offering Memorandum, as supplemented and amended by the written communications listed on Annex A
hereto. 
 “Time of Sale” means 11:15 A.M., New York City time, on September 15, 2016. 

On September 9, 2016, the Company entered into an amendment (the “Amendment”) to its Fifth Amended and Restated Credit
Agreement, dated as of March 11, 2014 among the Company, the lenders party thereto and JPMorgan Chase Bank, National Association, as Administration Agent, as amended from time to time (the “Credit Agreement”) to permit the offering
of the Securities. The Company intends to use the proceeds of the offering of the Securities to pay off the Company’s outstanding secured second lien term loan in an aggregate amount of $300,000,000 and all accrued and unpaid interest, fees and
other amounts, and cause all guarantees and liens granted by the Company, the Guarantor and any subsidiaries securing such obligations thereunder to be released (the “Debt Repayment”). 

Holders of the Securities (including the Initial Purchasers and their direct and indirect transferees) will be entitled to the benefits of a
Registration Rights Agreement, to be dated the Closing Date (as defined below)    and substantially in the form attached hereto as Exhibit A (the “Registration Rights Agreement”), pursuant to which the Company
and the Guarantors will agree to file one or more registration statements with the Securities and Exchange Commission (the “Commission”) providing for the registration under the Securities Act of the Securities or the Exchange
Securities referred to (and as defined) in the Registration Rights Agreement and the related Guarantee.
 The Company and the Guarantors
hereby confirm their agreement with the several Initial Purchasers concerning the purchase and sale of the Securities, as follows: 

1.    Purchase and Resale of the Securities. 

(a)    The Company agrees to issue and sell the Securities to the several Initial Purchasers as provided in this
Agreement, and each Initial Purchaser, on the basis of the 

 
representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Company the respective
principal amount of Securities set forth opposite such Initial Purchaser’s name in Schedule 1 hereto at a price equal to 97.8175% of the principal amount thereof plus accrued interest, if any, from October 3, 2016 to the Closing Date. The
Company will not be obligated to deliver any of the Securities except upon payment for all the Securities to be purchased as provided herein. 

(b)     The Company understands that the Initial Purchasers intend to offer the Securities for resale on the terms set
forth in the Time of Sale Information. Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that: 

(i)    it is a qualified institutional buyer within the meaning of Rule 144A under the Securities Act (a
“QIB”) and an accredited investor within the meaning of Rule 501(a) of Regulation D under the Securities Act (“Regulation D”); 

(ii)    it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or
sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act;
and 
 (iii)    it has not solicited offers for, or offered or sold, and will not solicit offers for, or
offer or sell, the Securities as part of their initial offering except: 
 (A)    within the United
States to persons whom it reasonably believes to be QIBs in transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”) and in connection with each such sale, it has taken or will take reasonable steps to ensure that the
purchaser of the Securities is aware that such sale is being made in reliance on Rule 144A; or 

(B)    in accordance with the restrictions set forth in Annex C hereto. 

(c)    Each Initial Purchaser acknowledges and agrees that the Company and, for purposes of the “no
registration” opinions to be delivered to the Initial Purchasers pursuant to Sections 6(h) and 6(i), counsel for the Company and the Guarantors and counsel for the Initial Purchasers, respectively, may rely upon the accuracy of the
representations and warranties of the Initial Purchasers, and compliance by the Initial Purchasers with their agreements, contained in paragraph (b) above (including Annex C hereto), and each Initial Purchaser hereby consents to such reliance. 

(d)    The Company acknowledges and agrees that the Initial Purchasers may offer and sell Securities to or through any
affiliate of an Initial Purchaser and that any such affiliate may offer and sell Securities purchased by it to or through any Initial Purchaser. 

 (e)    The Company and the Guarantors acknowledge and agree that each Initial
Purchaser is acting solely in the capacity of an arm’s length contractual counterparty to the Company and the Guarantors with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the
offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company, the Guarantors or any other person. Additionally, neither the Representative nor any other Initial Purchaser is advising the Company, the Guarantors or any
other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company and the Guarantors shall consult with their own advisors concerning such matters and shall be responsible for making their own
independent investigation and appraisal of the transactions contemplated hereby, and neither the Representative nor any other Initial Purchaser shall have any responsibility or liability to the Company or the Guarantors with respect
thereto. Any review by the Representative or any Initial Purchaser of the Company, the Guarantors, and the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the
Representative or such Initial Purchaser, as the case may be, and shall not be on behalf of the Company, the Guarantors or any other person. 

2.    Payment and Delivery.  

(a)    Payment for and delivery of the Securities will be made at the offices of Davis Polk & Wardwell LLP at 10:00
A.M., New York City time, on October 3, 2016, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representative and the Company may agree upon in writing. The time and date of
such payment and delivery is referred to herein as the “Closing Date.” 
 (b)    Payment for the
Securities shall be made by wire transfer in immediately available funds to the account(s) specified by the Company to the Representative against delivery to the nominee of The Depository Trust Company (“DTC”), for the account of
the Initial Purchasers, of one or more global notes representing the Securities (collectively, the “Global Note”), with any transfer taxes payable in connection with the sale of the Securities duly paid by the Company. The
Global Note will be made available for inspection by the Representative not later than 1:00 P.M., New York City time, on the business day prior to the Closing Date. 

3.    Representations and Warranties of the Company and the Guarantors. The Company and the Guarantors jointly
and severally represent and warrant to each Initial Purchaser that: 
 (a)    Preliminary Offering Memorandum, Time
of Sale Information and Offering Memorandum. The Preliminary Offering Memorandum, as of its date, did not, the Time of Sale Information, at the Time of Sale, did not, and at the Closing Date, will not, and the Offering Memorandum, in the
form first used by the Initial Purchasers to confirm sales of the Securities and as of the Closing Date, will not, contain any untrue statement 

 
of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided that the Company and the Guarantors make no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in
writing by such Initial Purchaser through the Representative expressly for use in the Preliminary Offering Memorandum, the Time of Sale Information or the Offering Memorandum. 

(b)    Additional Written Communications. The Company and the Guarantors (including their agents and
representatives, other than the Initial Purchasers in their capacity as such) have not prepared, made, used, authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any written communication that
constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Company and the Guarantors or their agents and representatives (other than a communication referred to in clauses (i) and (ii) below) an
“Issuer Written Communication”) other than (i) the Preliminary Offering Memorandum, (ii) the Offering Memorandum, (iii) the documents listed on Annex A hereto, including a term sheet substantially in the form of Annex B hereto,
which constitute part of the Time of Sale Information, and (iv) any electronic road show or other written communications, in each case used in accordance with Section 4(c). Each such Issuer Written Communication, when taken together with the
Time of Sale Information at the Time of Sale, did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that the Company and the Guarantors make no representation or warranty with respect to any statements or omissions made in each such Issuer Written Communication in reliance upon and
in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representative expressly for use in any Issuer Written Communication.     

(c)    Incorporated Documents. The documents incorporated by reference in each of the Time of Sale Information
and the Offering Memorandum, when filed with the Commission conformed in all material respects to the requirements of the Exchange Act, and none of such documents contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and any further documents so filed and incorporated by reference in each of the Time of
Sale Information and the Offering Memorandum, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. 

(d)    Financial Statements. The financial statements (including the related notes thereto) of the Company and
its consolidated subsidiaries included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum comply 

 
in all material respects with the applicable requirements of the Securities Act and the Exchange Act, as applicable, and present fairly in all material respects the financial position of the
Company and its consolidated subsidiaries as of the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such financial statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent basis throughout the periods covered thereby, and any supporting schedules included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum
present fairly in all material respects the information required to be stated therein; and the other financial information included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum has been derived
from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects the information shown thereby; and the pro forma financial and other information and the related notes thereto included or
incorporated by reference in each of the Time of Sale Information and the Offering Memorandum have been prepared in accordance with the applicable requirements of the Securities Act and the Exchange Act, as applicable, and the pro forma adjustments
to such pro forma financial and other information have been properly applied to the historical amounts in the compilation of such pro forma financial information, and the assumptions underlying such pro forma financial information are reasonable and
are set forth in each of the Time of Sale Information and the Offering Memorandum. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in each of the Preliminary Offering Memorandum, the Time of Sale
Information and the Offering Memorandum fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. 

(e)    Financial Statements of the Big Star Assets. The financial statements (including the related notes
thereto) related to the assets acquired by the Company (the “Big Star Assets”) pursuant to the purchase and sale agreement between the Company and BSM Energy LP, Crux Energy LP and Zaniah Energy, LP dated April 19, 2016 included or
incorporated by reference in each of the Time of Sale Information and the Offering Memorandum comply in all material respects with the applicable requirements of the Securities Act and the Exchange Act, as applicable, and present in all material
respects the financial position related to the Big Star Assets as of the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such financial statements have been prepared in conformity
with generally accepted accounting principles in the United States applied on a consistent basis throughout the periods covered thereby, except as disclosed therein, and any supporting schedules included or incorporated by reference in each of the
Time of Sale Information and the Offering Memorandum present fairly in all material respects the information required to be stated therein; and the other financial information included or incorporated by reference in each of the Time of Sale
Information and the Offering Memorandum has been derived from the accounting records related to the Big Star Assets and presents fairly in all material respects the information shown thereby. 

(f)    No Material Adverse Change. Except as described in the Time of Sale Information or the Offering
Memorandum, since the date of the most recent financial 

 
statements of the Company included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum, (i) there has not been any change in the capital stock (other
than the issuance of shares of common stock upon exercise of stock options described as outstanding in, and the grant of options and awards under existing equity incentive plans described in, the Time of Sale Information and the Offering Memorandum)
or material change in short-term debt or long-term debt of the Company or any of its subsidiaries, or any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital stock, or any
material adverse change, or any development involving a prospective material adverse change, in or affecting the business, properties, management, financial position, stockholders’ equity, or results of operations of the Company and its
subsidiaries taken as a whole; (ii) neither the Company nor any of its subsidiaries has entered into any transaction or agreement (whether or not in the ordinary course of business) that is material to the Company and its subsidiaries taken as a
whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiaries taken as a whole; and (iii) neither the Company nor any of its subsidiaries has sustained any loss or interference with its
business that is material to the Company and its subsidiaries taken as a whole and that is either from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or
decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in each of the Time of Sale Information and the Offering Memorandum. 

(g)    Organization and Good Standing. The Company, the Guarantors and each of their respective subsidiaries
have been duly organized and are validly existing and in good standing under the laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in each jurisdiction in which their respective
ownership or lease of property or the conduct of their respective businesses requires such qualification, and have all power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged,
except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, properties, management, financial
position, stockholders’ equity, results of operations or prospects of the Company and its subsidiaries taken as a whole or on the performance by the Company of its obligations under this Agreement, the Securities and the Guarantees (a
“Material Adverse Effect”). The subsidiaries listed in Schedule 2 to this Agreement are the only significant subsidiaries of the Company. 

(h)    Capitalization. The Company has an authorized capitalization as set forth in each of the Time of Sale
Information and the Offering Memorandum under the heading “Capitalization”; all the outstanding shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable. All the
outstanding shares of capital stock or other equity interests of each subsidiary owned, directly or indirectly, by the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly
by the Company, free and clear of any lien, charge, encumbrance, security interest, restriction on voting or 

 
transfer or any other claim of any third party (collectively, “Liens”), except for (i) Liens pursuant to the Company’s outstanding secured second lien term loan in an
aggregate amount of $300,000,000 (the “Second Lien Indebtedness”), which will be fully repaid and terminated upon consummation of the Debt Repayment, and (ii) Liens pursuant to the Company’s Credit Agreement in an aggregate
amount of $385,000,000 as described in each of the Time of Sale Information and the Offering Memorandum. 

(i)    Due Authorization. The Company and each of the Guarantors have full right, power and authority
to execute and deliver this Agreement, the Securities, the Indenture (including each Guarantee set forth therein), the Exchange Securities, (including the related Guarantee), the Registration Rights Agreement, and the Amendment (collectively, the
“Transaction Documents”) and to perform their respective obligations hereunder and thereunder; and all action required to be taken for the due and proper authorization, execution and delivery of each of the Transaction Documents and
the consummation of the transactions contemplated thereby has been duly and validly taken. 
 (j)    The Exchange
Securities. On the Closing Date, the Exchange Securities (including the related Guarantee) will have been duly authorized by the Company and each of the Guarantors and, when duly executed, authenticated, issued and delivered as contemplated
by the Registration Rights Agreement, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Company, as issuer, and each of the Guarantors, as guarantor, enforceable against the Company and
each of the Guarantors in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture. 

(k)    The Indenture. The Indenture has been duly authorized by the Company and each of the Guarantors and on
the Closing Date will be duly executed and delivered by the Company and each of the Guarantors and, when duly executed and delivered in accordance with its terms by each of the parties thereto, will constitute a valid and legally binding agreement
of the Company and each of the Guarantors enforceable against the Company and each of the Guarantors in accordance with its terms, except as enforceability may be limited by applicable (A) bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability and (B) by public policy, applicable law relating to fiduciary duties and indemnification and
implied covenant of good faith and fair dealing (collectively, the “Enforceability Exceptions”). On the Closing Date, the Indenture will conform in all material respects to the requirements of the Trust Indenture Act of 1939, as
amended (the “Trust Indenture Act”) (except that the Indenture will not be qualified thereunder), and the rules and regulations of the Commission applicable to an indenture that is qualified thereunder. 

(l)    The Securities and the Guarantees. The Securities have been duly authorized by the Company and, when
duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, assuming due authorization of the Securities by the Trustee, will be duly and validly issued and outstanding and will constitute valid
and legally binding obligations of the Company enforceable against the 

 
Company in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture; and the Guarantees have been duly authorized by each of
the Guarantors and, when the Securities have been duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be valid and legally binding obligations of each of the Guarantors, enforceable
against each of the Guarantors in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture. 

(m)    Purchase and Registration Rights Agreements. This Agreement has been duly authorized, executed and delivered
by the Company and each of the Guarantors; and the Registration Rights Agreement has been duly authorized by the Company and each of the Guarantors and on the Closing Date will be duly executed and delivered by the Company and each of the Guarantors
and, when duly executed and delivered in accordance with its terms by each of the parties thereto, will constitute a valid and legally binding agreement of the Company and each of the Guarantors enforceable against the Company and each of the
Guarantors in accordance with its terms, subject to the Enforceability Exceptions, and except that rights to indemnity and contribution thereunder may be limited by applicable law and public policy. 

(n)    Amendment. The Amendment has been duly authorized, executed and delivered by the Company and the
Guarantor and constitutes a valid and legally binding agreement of the Company and the Guarantor enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions. 

(o)    Description of this Agreement. This Agreement conforms in all material respects to the description
thereof contained in each of the Time of Sale Information and the Offering Memorandum. 
 (p)    Descriptions of the
Registration Rights Agreement and the Amendment. The Registration Rights Agreement and Amendment each conform in all material respects to the descriptions thereof contained in each of the Time of Sale Information and the Offering
Memorandum. 
 (q)    No Violation or Default. None of the Company, the Guarantors or any of their
subsidiaries is (i) in violation of its charter or by-laws or similar organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company, the Guarantors or any of their respective subsidiaries is a party or by which
the Company, the Guarantors or any of their respective subsidiaries is bound or to which any of the property or assets of the Company, the Guarantors or any of their respective subsidiaries is subject; or (iii) in violation of any law or statute or
any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, have
a Material Adverse Effect. 

 (r)    No Conflicts. The execution, delivery and
performance by the Company and each of the Guarantors of each of the Transaction Documents to which each is a party, the issuance and sale of the Securities and the issuance of the Guarantees, the issuance of the Exchange Notes and the related
Guarantee, and compliance by the Company and each of the Guarantors with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents will not (i) conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, (ii) result in any violation of the provisions of the charter or by-laws or similar organizational documents of the Company or any of its subsidiaries or (iii) result in the violation of any law or statute or any judgment,
order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (i) and (iii) above, for any such conflict, breach, violation, default, lien, charge or encumbrance that would not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 
 (s)    No Consents
Required. No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or governmental or regulatory authority is required for the execution, delivery and performance by the Company and each
of the Guarantors of each of the Transaction Documents to which each is a party, the issuance and sale of the Securities and the issuance of the Guarantees, the issuance of the Exchange Notes and the related Guarantee, and compliance by the Company
and each of the Guarantors with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents, except for such consents, approvals, authorizations, orders and registrations or qualifications as may be required
(i) under applicable state securities laws in connection with the purchase and resale of the Securities by the Initial Purchasers, (ii) with respect to the Exchange Securities (including the related Guarantee) under the Securities Act, the Trust
Indenture Act and applicable state securities laws as contemplated by the Registration Rights Agreement, and (iii) for such consents, approvals, authorizations, orders, registrations or qualifications which if not obtained or made would not,
individually or in the aggregate, have a Material Adverse Effect. 
 (t)    Legal Proceedings. Except as
described in each of the Time of Sale Information and the Offering Memorandum, there are no legal, governmental or regulatory investigations, actions, suits or proceedings pending to which the Company, the Guarantors or any of their respective
subsidiaries is a party or to which any property of the Company, the Guarantors or any of their respective subsidiaries is the subject that, individually or in the aggregate, if determined adversely to the Company, the Guarantors or any of their
respective subsidiaries, could reasonably be expected to have a Material Adverse Effect; to the knowledge of the Company, no such investigations, actions, suits or proceedings are threatened or contemplated by any governmental or regulatory
authority or threatened by others. 

 (u)    Independent Accountants. Ernst & Young LLP, who has
certified certain financial statements of the Company and its subsidiaries, is an independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable rules and regulations adopted by the Commission
and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act. 

(v)    Independent Accountants. Grant Thornton LLP is an independent registered public accounting firm with
respect to the Company and its subsidiaries within the applicable rules and regulations adopted by the Commission and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act. 

(w)    Independent Accountants. Weaver and Tidwell, L.L.P., who has certified certain financial statements
related to the Big Star, is an independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable rules and regulations adopted by the Commission and the Public Company Accounting Oversight Board
(United States) and as required by the Securities Act. 
 (x)    Title to Real and Personal Property. Except
as otherwise set forth in the each of the Time of Sale Information and the Offering Memorandum or such as in the aggregate does not now cause or will in the future cause a Material Adverse Effect, the Company, the Guarantors and each of their
respective subsidiaries own their respective properties as follows: (i) with respect to wells (including leasehold interests and appurtenant personal property) and non-producing oil and natural gas properties (including undeveloped locations on
leases held by production and those leases not held by production), such title is good and free and clear of all liens, security interests, pledges, charges, encumbrances, mortgages and restrictions, (ii) with respect to non-producing properties in
exploration prospects, such title was investigated in accordance with customary industry procedures prior to the acquisition thereof by the Company, the Guarantors or their respective subsidiaries, (iii) with respect to real property other than oil
and gas interests, such title is good and marketable free and clear of all liens, security interests, pledges, charges, encumbrances, mortgages and restrictions, and (iv) with respect to personal property other than that appurtenant to oil and gas
interests, such title is free and clear of all liens, security interests, pledges, charges, encumbrances, mortgages and restrictions. No real property owned, leased, licensed, or used by the Company, the Guarantors or their respective
subsidiaries lies in an area which is, or to the knowledge of the Company will be, subject to restrictions which would prohibit, and no statements of facts relating to the actions or inaction of another person or entity or his or its ownership,
leasing, licensing, or use of any real or personal property exists or will exist which would prevent, the continued effective ownership, leasing, licensing, exploration, development or production or use of such real property in the business of the
Company, the Guarantors or their respective subsidiaries as presently conducted or as each of the Time of Sale Information and the Offering Memorandum indicates they contemplate conducting, except as may be described in the Time of Sale Information
and the Offering Memorandum or such as in the aggregate do not now cause and will not in the future cause a Material Adverse Effect. 

 (y)    Title to Intellectual Property. The Company, the
Guarantors and each of their respective subsidiaries own or possess adequate rights to use all material patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses
and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) necessary for the conduct of their respective businesses as currently conducted and as proposed to be
conducted, and the conduct of their respective businesses will not conflict in any material respect with any such rights of others except as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse
Effect. The Company, the Guarantors and each of their respective subsidiaries have not received any notice of any claim of infringement, misappropriation or conflict with any such rights of others in connection with its patents, patent rights,
licenses, inventions, trademarks, service marks, trade names, copyrights and know-how, which could reasonably be expected to result in a Material Adverse Effect. 

(z)    No Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company,
the Guarantors and their respective subsidiaries, on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company, the Guarantors or any of their respective subsidiaries, on the other, that would be required by the
Securities Act to be described in a registration statement on Form S-1 to be filed with the Commission and that is not so described in each of the Time of Sale Information and the Offering Memorandum. 

(aa)    Investment Company Act. Neither the Company nor any of the Guarantors is and, after giving effect to
the offering and sale of the Securities and the application of the proceeds thereof as described in each of the Time of Sale Information and the Offering Memorandum, will not be required to register as an “investment company” or an entity
“controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Investment Company
Act”). 
 (bb)    Taxes. The Company, the Guarantors and their respective subsidiaries have paid
all federal, state, local and foreign taxes and filed all tax returns required to be paid or filed through the date hereof, except to the extent that the failure to file such tax returns and/or pay such taxes would not, individually and in the
aggregate, have a Material Adverse Effect; and except as otherwise disclosed in each of the Time of Sale Information and Offering Memorandum, there is no tax deficiency that has been, or could reasonably be expected to be, asserted against the
Company, the Guarantors or any of their respective subsidiaries or any of their respective properties or assets. 

(cc)    Licenses and Permits. The Company, the Guarantors and their respective subsidiaries possess all
licenses, certificates, permits and other authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or
lease of their respective properties or the conduct of their respective businesses as described in each of the Time of Sale Information and Offering Memorandum, except where the failure to possess or make the same would not, individually or in the
aggregate, 

 
have a Material Adverse Effect; and except as described in each of the Time of Sale Information and Offering Memorandum, neither the Company, the Guarantors nor any of their respective
subsidiaries has received notice of any revocation or modification of any such license, certificate, permit or authorization or has any reason to believe that any such license, certificate, permit or authorization will not be renewed in the ordinary
course. 
 (dd)    No Labor Disputes. Except as would not reasonably be expected to result in a
Material Adverse Effect, no labor disturbance by or dispute with employees of the Company, the Guarantors or any of their respective subsidiaries exists or, to the knowledge of the Company or the Guarantors, is contemplated or threatened, and
neither the Company nor the Guarantors are aware of any existing or imminent labor disturbance by, or dispute with, the employees of any of their or their respective subsidiaries’ principal suppliers, contractors or customers. 

(ee)    Compliance with and Liability under Environmental Laws. (i) The Company, the Guarantors and their
respective subsidiaries (A) are in compliance with any and all applicable federal, state, local and foreign laws, rules, regulations, requirements, decisions, judgments, decrees, orders and the common law relating to pollution or the protection of
the environment, natural resources or human health or safety, including those relating to the generation, storage, treatment, use, handling, transportation, Release or threat of Release of Hazardous Materials (collectively, “Environmental
Laws”), (B) have received and are in compliance with all permits, licenses, certificates or other authorizations or approvals required of them under applicable Environmental Laws to conduct their respective businesses, (C) have not received
notice of any actual or potential liability under or relating to, or actual or potential violation of, any Environmental Laws, including for the investigation or remediation of any Release or threat of Release of Hazardous Materials, and have no
knowledge of any event or condition that would reasonably be expected to result in any such notice, (D) are not conducting or paying for, in whole or in part, any investigation, remediation or other corrective action pursuant to any Environmental
Law at any location, and (E) are not a party to any order, decree or agreement that imposes any obligation or liability under any Environmental Law, and (ii) there are no costs or liabilities associated with Environmental Laws of or relating to the
Company or its subsidiaries, except in the case of each of (i) and (ii) above, for any such matter, as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and (iii) except as described in each of
the Time of Sale Information and Offering Memorandum, (A) there are no proceedings that are pending, or that are known to be contemplated, against the Company or any of its subsidiaries under any Environmental Laws in which a governmental entity is
also a party, other than such proceedings regarding which it is reasonably believed no monetary sanctions of $100,000 or more will be imposed, (B) the Company and its subsidiaries are not aware of any facts or issues regarding compliance with
Environmental Laws, or liabilities or other obligations under Environmental Laws, including the Release or threat of Release of Hazardous Materials, that could reasonably be expected to have a material effect on the capital expenditures, earnings or
competitive position of the Company and its subsidiaries, and (C) none of the Company and its subsidiaries anticipates material capital expenditures relating to any Environmental Laws. 

 (ff)    Hazardous Materials. There has been no storage, generation,
transportation, use, handling, treatment, Release or threat of Release of Hazardous Materials by or caused by the Company, the Guarantors or any of their respective subsidiaries (or, to the knowledge of the Company, the Guarantors or any of their
respective subsidiaries, any other entity (including any predecessor) for whose acts or omissions the Company, the Guarantors or any of their respective subsidiaries is or could reasonably be expected to be liable) at, on, under or from any property
or facility now or previously owned, operated or leased by the Company, the Guarantors or any of their respective subsidiaries, or at, on, under or from any other property or facility, in violation of any Environmental Laws or in a manner or amount
or to a location that could reasonably be expected to result in any liability under any Environmental Law, except for any violation or liability which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. “Hazardous Materials” means any material, chemical, substance, waste, pollutant, contaminant, compound, mixture, or constituent thereof, in any form or amount, including petroleum (including crude oil or any fraction
thereof) and petroleum products, natural gas liquids, asbestos and asbestos containing materials, naturally occurring radioactive materials, brine, and drilling mud, regulated or which can give rise to liability under any Environmental Law.
“Release” means any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, dispersing, or migrating in, into or through the environment, or in,
into, from or through any building or structure. 
 (gg)    Compliance with ERISA. (i) Each employee
benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), for which the Company or any member of its “Controlled Group” (defined as any organization
which is a member of a controlled group of corporations within the meaning of Section 414 of the Code) would have any liability (each, a “Plan”) has been maintained in compliance with its terms and the requirements of any applicable
statutes, orders, rules and regulations, including but not limited to ERISA and the Code, except for noncompliance that could not reasonably be expected to result in material liability to the Company, the Guarantors or their respective subsidiaries;
(ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any Plan excluding transactions effected pursuant to a statutory or administrative exemption that could reasonably
be expected to result in a material liability to the Company, the Guarantors or their respective subsidiaries; (iii) for each Plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA, as applicable, has been satisfied (without taking into account any waiver thereof or extension of any amortization period) and is reasonably expected to be satisfied in the future (without taking
into account any waiver thereof or extension of any amortization period); (iv) the fair market value of the assets of each Plan exceeds the present value of all benefits accrued under such Plan (determined based on those assumptions used to fund
such Plan); (v) no “reportable event” (within the meaning of Section 4043(c) of ERISA) has occurred or is reasonably expected to occur that either has resulted, or could reasonably be expected to result, in material liability to the
Company, the Guarantors or their respective subsidiaries; (vi) neither the Company nor any member of the Controlled Group has incurred, nor reasonably expects to incur, any liability under Title IV of

 
ERISA (other than contributions to the Plan or premiums to the PBGC, in the ordinary course and without default) in respect of a Plan (including a “multiemployer plan”, within the
meaning of Section 4001(a)(3) of ERISA); and (vii) there is no pending audit or investigation by the Internal Revenue Service, the U.S. Department of Labor, the Pension Benefit Guaranty Corporation or any other governmental agency or any foreign
regulatory agency with respect to any Plan that could reasonably be expected to result in material liability to the Company, the Guarantors or their respective subsidiaries. None of the following events has occurred or is reasonably likely to occur:
(x) a material increase in the aggregate amount of contributions required to be made to all Plans by the Company, the Guarantors or their respective subsidiaries in the current fiscal year of the Company, the Guarantors or their respective
subsidiaries compared to the amount of such contributions made in the Company and its subsidiaries’ most recently completed fiscal year; or (y) a material increase in the Company and its subsidiaries’ “accumulated post-retirement
benefit obligations” (within the meaning of Statement of Financial Accounting Standards 106) compared to the amount of such obligations in the Company and its subsidiaries’ most recently completed fiscal year. 

(hh)    Disclosure Controls. The Company and its subsidiaries maintain an effective system of “disclosure
controls and procedures” (as defined in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to ensure that information required to be disclosed by the Company in reports that it
files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, including controls and procedures designed to ensure that such information is
accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure. The Company and its subsidiaries have carried out evaluations of the effectiveness of their disclosure
controls and procedures as required by Rule 13a-15 of the Exchange Act. 
 (ii)    Accounting Controls. The
Company and its subsidiaries maintain systems of “internal control over financial reporting” (as defined in Rule 13a-15(f) of the Exchange Act) that comply with the requirements of the Exchange Act and have been designed by, or under the
supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance
with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken
with respect to any differences and (v) interactive data in eXtensible Business Reporting Language included or incorporated by reference in each of the Preliminary Offering Memorandum, the Time of Sale Information and the Offering Memorandum is
prepared in accordance with the 

 
Commission’s rules and guidelines applicable thereto. Based on the Company’s most recent evaluation of its internal controls over financial reporting pursuant to Rule 13a-15(c) of
the Exchange Act, except as disclosed in each of the Time of Sale Information and the Offering Memorandum, there are no material weaknesses in the Company’s internal controls. The Company’s auditors and the Audit Committee of the
Board of Directors of the Company have been advised of: (i) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which have adversely affected or are reasonably likely to
adversely affect the Company’s ability to record, process, summarize and report financial information; and (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s
internal controls over financial reporting. 
 (jj)    Insurance. The Company, the Guarantors and
their respective subsidiaries have insurance covering their respective properties, operations, personnel and businesses, which insurance is in amounts and insures against such losses and risks as are reasonably adequate to protect the Company, the
Guarantors and their respective subsidiaries and their respective businesses; and neither the Company, the Guarantors and their respective subsidiaries has (i) received notice from any insurer or agent of such insurer that capital improvements or
other expenditures are required or necessary to be made in order to continue such insurance or (ii) any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar
coverage at reasonable cost from similar insurers as may be necessary to continue its business. 
 (kk)    No
Unlawful Payments. Neither the Company, the Guarantors nor any of their respective subsidiaries nor any director, officer or employee of the Company, the Guarantors or any of their respective subsidiaries nor, to the knowledge of the Company,
any agent, affiliate or other person associated with or acting on behalf of the Company, the Guarantors or any of their respective subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; (ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful payment or benefit to any foreign or domestic government official or employee, including of any
government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office; (iii)
violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International Business
Transactions, or committed an offence under the Bribery Act 2010 of the United Kingdom or any other applicable anti-bribery or anti-corruption law; or (iv) made, offered, agreed, requested or taken an act in furtherance of any unlawful bribe or
other unlawful benefit, including, without limitation, any rebate, payoff, influence payment, kickback or other unlawful or improper payment or benefit. The Company, the Guarantors and their respective subsidiaries have instituted, maintain and
enforce, and will continue to maintain and enforce policies and procedures designed to promote and ensure compliance with all applicable anti-bribery and anti-corruption laws. 

 (ll)    Compliance with Anti-Money Laundering Laws. The
operations of the Company, the Guarantors and their respective subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements, including those of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions where the Company, the Guarantors or any of their respective subsidiaries conducts business, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”) and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company, the Guarantors or any of their respective subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company or any of the
Guarantors, threatened. 
 (mm)    No Conflicts with Sanctions Laws. None of the Company, the Guarantors or any
of their respective subsidiaries, directors, officers, or employees, nor, to the knowledge of the Company or any of the Guarantors, any agent, affiliate or other person associated with or acting on behalf of the Company, the Guarantors or any of
their respective subsidiaries is currently the subject or the target of any sanctions administered or enforced by the U.S. government, (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury
(“OFAC”) or the U.S. Department of State and including, without limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security Council
(“UNSC”), the European Union, Her Majesty’s Treasury (“HMT”) or other relevant sanctions authority (collectively, “Sanctions”), nor are the Company, the Guarantors or any of their respective
subsidiaries located, organized or resident in a country or territory that is the subject or target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan, Syria and Crimea (each, a “Sanctioned Country”); and
the Company will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund or
facilitate any activities of or business with any person that, at the time of such funding or facilitation, is the subject or target of Sanctions, (ii) to fund or facilitate any activities of or business in any Sanctioned Country or (iii) in any
other manner that will result in a violation by any person (including any person participating in the transaction, whether as Initial Purchaser, advisor, investor or otherwise) of Sanctions. For the past five years, the Company and its
subsidiaries have not knowingly engaged in and are not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any Sanctioned
Country. 
 (nn)    Solvency. On and immediately after the Closing Date, the Company and each Guarantor
(after giving effect to the issuance and sale of the Securities, the issuance of the Guarantees and the other transactions related thereto as described in each of the Time of Sale Information and the Offering Memorandum) will be Solvent. As
used in this paragraph, the term “Solvent” means, with respect to a particular date and entity, that on such date (i) the fair value (and present fair saleable value) of the assets of such entity is not less than the total amount
required to pay the probable liability of such entity on its 

 
total existing debts and liabilities (including contingent liabilities) as they become absolute and matured; (ii) such entity is able to realize upon its assets and pay its debts and other
liabilities, contingent obligations and commitments as they mature and become due in the normal course of business; (iii) assuming consummation of the issuance and sale of the Securities and the issuance of the Guarantees as contemplated by this
Agreement, the Time of Sale Information and the Offering Memorandum, such entity does not have, intend to incur or believe that it will incur debts or liabilities beyond its ability to pay as such debts and liabilities mature; (iv) such entity is
not engaged in any business or transaction, and does not propose to engage in any business or transaction, for which its property would constitute unreasonably small capital; and (v) such entity is not a defendant in any civil action that would
result in a judgment that such entity is or would become unable to satisfy. 
 (oo)    Senior
Indebtedness. The Securities constitute “senior indebtedness” as such term is defined in any indenture or agreement governing any outstanding subordinated indebtedness of the Company. 

(pp)    No Restrictions on Subsidiaries. No subsidiary of the Company is currently prohibited, directly or
indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such subsidiary’s capital stock, from repaying to the Company any loans or
advances to such subsidiary from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other subsidiary of the Company, except for any such restrictions (a) contained in the Credit Agreement, (b)
as contained in the Second Lien Indebtedness, which will be repaid in full and terminated within 30 days of the Closing Date as described in each of the Time of Sale Information and the Offering Memorandum, or (c) that will be permitted by the
Indenture.
 (qq)    No Broker’s Fees. Neither the Company nor any of its subsidiaries is a party to
any contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against the Company or any of its subsidiaries or any Initial Purchaser for a brokerage commission, finder’s fee or like
payment in connection with the offering and sale of the Securities. 
 (rr)    Rule 144A Eligibility. On the
Closing Date, the Securities will not be of the same class as securities listed on a national securities exchange registered under Section 6 of the Exchange Act or quoted in an automated inter-dealer quotation system; and each of the Preliminary
Offering Memorandum and the Offering Memorandum, as of its respective date, contains or will contain all the information that, if requested by a prospective purchaser of the Securities, would be required to be provided to such prospective purchaser
pursuant to Rule 144A(d)(4) under the Securities Act. 
 (ss)    No Integration. None of the Company, the
Guarantors nor any of their respective affiliates (as defined in Rule 501(b) of Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the
Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act. 

 (tt)    Margin Rules. The application of the proceeds received by
the Company from the issuance, sale and delivery of the Securities as described in each of the Time of Sale Information and the Offering Memorandum will not violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any
other regulation of such Board of Governors. 
 (uu)    No General Solicitation or Directed Selling
Efforts. None of the Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no representation is made) has (i) solicited offers for, or offered or sold, the
Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act or (ii) engaged
in any directed selling efforts within the meaning of Regulation S under the Securities Act (“Regulation S”), and all such persons have complied with the offering restrictions requirement of Regulation S. 

(vv)    Securities Law Exemptions. Assuming the accuracy of the representations and warranties of the Initial
Purchasers contained in Section 1(b) (including Annex C hereto) and their compliance with their agreements set forth therein, it is not necessary, in connection with the issuance and sale of the Securities to the Initial Purchasers and the offer,
resale and delivery of the Securities by the Initial Purchasers in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum, to register the Securities under the Securities Act or to qualify the Indenture
under the Trust Indenture Act. 
 (ww)    No Stabilization. Neither the Company nor any of the Guarantors
has taken, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities. 

(xx)    Forward-Looking Statements. No forward-looking statement (within the meaning of Section 27A of the
Securities Act and Section 21E of the Exchange Act) included or incorporated by reference in any of the Time of Sale Information or the Offering Memorandum has been made or reaffirmed without a reasonable basis or has been disclosed other than in
good faith. 
 (yy)    Statistical and Market Data. Nothing has come to the attention of the Company or any
Guarantor that has caused the Company or such Guarantor to believe that the statistical and market-related data included or incorporated by reference in the each of the Time of Sale Information and the Offering Memorandum is not based on or derived
from sources that are reliable and accurate in all material respects. 
 (zz)    Independent Petroleum
Engineers. DeGolyer and MacNaughton and Huddleston & Co., Inc., who have each prepared certain reserve information of the Company, the Guarantors and their respective subsidiaries have each represented to the

 
Company and the Guarantors that they are, and to the knowledge of the Company and the Guarantors are, independent petroleum engineers in accordance with guidelines established by the Commission,
respectively. 
 (aaa)    Reserve Report Data. The oil and gas reserve estimates of the Company and
the Guarantors included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum are derived from reports that have been prepared by either (i) DeGoyler and MacNaughton or (ii) Huddleston & Co., Inc. as
set forth and to the extent indicated therein, and have been prepared in accordance with Commission guidelines in all material respects, and the Company and the Guarantors have no reason to believe that such estimates do not fairly reflect, in all
material respects, the oil and gas reserves of the Company and such Guarantors as of the dates indicated therein. The Company and the Guarantors have no reason to believe that the estimates of reserves included or incorporated by reference in
each of the Time of Sale Information and the Offering Memorandum with respect to the Big Star Assets do not fairly reflect, in all material respects, the oil and gas reserves of the Big Star Assets as of the dates indicated therein. Other than
production of the reserves in the ordinary course of business, intervening product price fluctuations, fluctuations in demand for such products, adverse weather conditions, unavailability or increased costs of rigs, services, supplies or personnel,
the timing of third party operations and other facts, in each case in the ordinary course of business, and as described in each of the Time of Sale Information and the Offering Memorandum, the Company and the Guarantors are not aware of any facts or
circumstances that would cause a Material Adverse Effect in the reserves or the present value of future net cash flows therefrom as described in each of the Time of Sale Information and the Offering Memorandum. 

(bbb)    Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or, to the knowledge
of the Company, any of the Company’s directors or officers, in their capacities as such, to comply with any applicable provision of the Sarbanes-Oxley Act of 2002, as amended and any applicable rules and regulations promulgated in connection
therewith (the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications. 

(ccc)    Acquisition Agreement. The Purchase and Sale Agreement (the “Acquisition Agreement’)
among Plymouth Petroleum, LLC, as Sellers and Callon Petroleum Operating Company (“CPOC”), as Purchaser dated September 1, 2016 has been duly authorized, executed and delivered by, and is a valid and binding agreement of
CPOC, enforceable in accordance with its terms, and, to the knowledge of the Company, the Acquisition Agreement has been duly authorized, executed and delivered by, and is a valid and binding agreement of the parties thereto, enforceable in
accordance with its terms, except as enforcement thereof may be subject to or limited by bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganizations, moratorium or similar laws affecting
enforcement of creditors’ rights generally or by general equitable principles. 

 4.    Further Agreements of the Company and the Guarantors. The
Company and the Guarantors jointly and severally covenant and agree with each Initial Purchaser that: 

(a)    Delivery of Copies. The Company will deliver, without charge, to the Initial Purchasers as many copies
of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including all amendments and supplements thereto) as the Representative may reasonably request. 

(b)    Offering Memorandum, Amendments or Supplements. Before finalizing the Offering Memorandum or making or
distributing any amendment or supplement to any of the Time of Sale Information or the Offering Memorandum or filing with the Commission any document that will be incorporated by reference therein, the Company will furnish to the Representative and
counsel for the Initial Purchasers a copy of the proposed Offering Memorandum or such amendment or supplement or document to be incorporated by reference therein for review, and will not distribute any such proposed Offering Memorandum, amendment or
supplement or file any such document with the Commission to which the Representative reasonably objects. 

(c)    Additional Written Communications. Before making, using, authorizing, approving or referring to any
Issuer Written Communication, the Company and the Guarantors will furnish to the Representative and counsel for the Initial Purchasers a copy of such written communication for review and will not make, use, authorize, approve or refer to any such
written communication to which the Representative reasonably objects. 
 (d)    Notice to the
Representative. The Company will advise the Representative promptly, and confirm such advice in writing, (i) of the issuance by any governmental or regulatory authority of any order preventing or suspending the use of any of the Time of
Sale Information, any Issuer Written Communication or the Offering Memorandum or the initiation or threatening of any proceeding for that purpose; (ii) of the occurrence of any event at any time prior to the completion of the initial offering of the
Securities as a result of which any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances existing when such Time of Sale Information, Issuer Written Communication or the Offering Memorandum is delivered to a purchaser, not misleading; and (iii) of the
receipt by the Company of any notice with respect to any suspension of the qualification of the Securities for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Company will use its
reasonable best efforts to prevent the issuance of any such order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication or the Offering Memorandum or suspending any such qualification of the
Securities and, if any such order is issued, will use its reasonable best efforts to obtain as soon as possible the withdrawal thereof. 

 (e)    Time of Sale Information. If at any time prior to
the Closing Date (i) any event shall occur or condition shall exist as a result of which any of the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with law, the Company will
immediately notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments or supplements to the Time of Sale Information (or any document to be filed with the
Commission and incorporated by reference therein) as may be necessary so that the statements in any of the Time of Sale Information as so amended or supplemented (including such documents to be incorporated by reference therein) will not, in the
light of the circumstances under which they were made, be misleading or so that any of the Time of Sale Information will comply with law.

(f)    Ongoing Compliance of the Offering Memorandum. If at any time prior to the completion of the initial
offering of the Securities (i) any event shall occur or condition shall exist as a result of which the Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Offering Memorandum to comply
with law, the Company will immediately notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments or supplements to the Offering Memorandum (or any document to
be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in the Offering Memorandum as so amended or supplemented (including such document to be incorporated by reference therein) will not, in
the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, be misleading or so that the Offering Memorandum will comply with law. 

(g)    Blue Sky Compliance. The Company will qualify the Securities for offer and sale under the securities or
Blue Sky laws of such jurisdictions as the Representative shall reasonably request and will continue such qualifications in effect so long as required for the offering and resale of the Securities; provided that neither the Company nor any of
the Guarantors shall be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of
process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject. 

(h)    Clear Market. During the period from the date hereof through and including the date that is 30 days
after the date hereof, the Company and each of the Guarantors will not, without the prior written consent of the Representative, offer, sell, contract to sell or otherwise dispose of any debt securities issued or guaranteed by the Company or any of
the Guarantors and having a tenor of more than one year. 

 (i)    Use of Proceeds. The Company will apply the net proceeds
from the sale of the Securities as described in each of the Time of Sale Information and the Offering Memorandum under the heading “Use of proceeds.” 

(j)    Supplying Information. While the Securities remain outstanding and are “restricted
securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company and each of the Guarantors will, during any period in which the Company is not subject to and in compliance with Section 13 or 15(d) of the Exchange Act,
furnish to holders of the Securities and prospective purchasers of the Securities designated by such holders, upon the request of such holders or such prospective purchasers, the information required to be delivered pursuant to Rule 144A(d)(4) under
the Securities Act. 
 (k)    DTC. The Company will assist the Initial Purchasers in arranging for the
Securities to be eligible for clearance and settlement through DTC. 
 (l)    No Resales by the Company. The
Company will not, and will not permit any of its affiliates (as defined in Rule 144 under the Securities Act) to, resell any of the Securities that have been acquired by any of them, except for Securities purchased by the Company or any of its
affiliates and resold in a transaction registered under the Securities Act. 
 (m)    No
Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b) of Regulation D) will, directly or through any agent, sell, offer for sale, solicit offers to buy or otherwise negotiate in respect of, any security (as
defined in the Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act. 

(n)    No General Solicitation or Directed Selling Efforts. None of the Company, the Guarantors or any of
their respective affiliates or any other person acting on their behalf (other than the Initial Purchasers, as to which no covenant is given) will (i) solicit offers for, or offer or sell, the Securities by means of any form of general solicitation
or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act or (ii) engage in any directed selling efforts within the meaning of
Regulation S, and all such persons will comply with the offering restrictions requirement of Regulation S. 

(o)    No Stabilization. Neither the Company nor any of the Guarantors will take, directly or indirectly, any
action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities. 

(p)    Reports. So long as the Securities are outstanding, the Company will furnish to the Representative, as soon
as they are available, copies of all reports or other communications (financial or other) furnished to holders of the Securities, and copies of any reports and financial statements furnished to or filed with the Commission or any national securities
exchange or automatic quotation system; provided the Company will be deemed to have furnished such reports and financial statements to the Representative to the extent they are filed on the Commission’s Electronic Data Gathering, Analysis, and
Retrieval system. 

 (q)    Record Retention. The Company will, pursuant to reasonable
procedures developed in good faith, retain copies of each Issuer Written Communication that is not filed with the Commission in accordance with Rule 433 under the Securities Act. 

(r)    Debt Repayment. The Company and the Guarantor will, within 30 days following the Closing Date complete the
Debt Repayment. 
 (s)    Amendment. Prior to the Closing Date, the Company and the Guarantors shall
have entered into the Amendment consistent in all material respects with the terms described in the Time of Sale Information and the Offering Memorandum and the Representative shall have received conformed counterparts thereof. 

5.     Certain Agreements of the Initial Purchasers. Each Initial Purchaser hereby represents and agrees that it
has not and will not use, authorize use of, refer to, or participate in the planning for use of, any written communication that constitutes an offer to sell or the solicitation of an offer to buy the Securities other than (i) the Preliminary
Offering Memorandum and the Offering Memorandum, (ii) any written communication that contains either (a) no “issuer information” (as defined in Rule 433(h)(2) under the Securities Act) or (b) “issuer information” that was
included (including through incorporation by reference) in the Time of Sale Information or the Offering Memorandum, (iii) any written communication listed on Annex A or prepared pursuant to Section 4(c) (including any electronic road show) above,
(iv) any written communication prepared by such Initial Purchaser and approved by the Company and the Representative in advance in writing or (v) any written communication relating to or that contains the terms of the Securities and/or other
information that was included (including through incorporation by reference) in the Time of Sale Information or the Offering Memorandum. 

6.    Conditions of Initial Purchasers’ Obligations. The obligation of each Initial Purchaser to purchase
the Securities on the Closing Date as provided herein is subject to the performance by the Company and each of the Guarantors of their respective covenants and other obligations hereunder and to the following additional conditions: 

(a)    Representations and Warranties. The representations and warranties of the Company and the Guarantors
contained herein shall be true and correct on the date hereof and on and as of the Closing Date; and the statements of the Company, the Guarantors and their respective officers made in any certificates delivered pursuant to this Agreement shall be
true and correct on and as of the Closing Date. 
 (b)    No Downgrade. Subsequent to the earlier of (A) the Time
of Sale and (B) the execution and delivery of this Agreement, if there are any debt securities or preferred stock of, or guaranteed by, the Company, the Guarantors or any of their respective subsidiaries that are rated by a “nationally
recognized statistical rating organization,” as such term is defined under Section 3(a)(62) of the Exchange Act, (i) no downgrading 

 
shall have occurred in the rating accorded any such debt securities or preferred stock and (ii) no such organization shall have publicly announced that it has under surveillance or review, or has
changed its outlook with respect to, its rating of any such debt securities or preferred stock (other than an announcement with positive implications of a possible upgrading). 

(c)    No Material Adverse Change. No event or condition of a type described in Section 3(f) hereof shall have
occurred or shall exist, which event or condition is not described in each of the Time of Sale Information (excluding any amendment or supplement thereto) and the Offering Memorandum (excluding any amendment or supplement thereto) and the effect of
which in the judgment of the Representative makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the Closing Date on the terms and in the manner contemplated by this Agreement, the Time of Sale
Information and the Offering Memorandum. 
 (d)    Officer’s Certificate. The Representative shall have
received on and as of the Closing Date a certificate of the chief financial officer or chief accounting officer of the Company and of each Guarantor and one additional senior executive officer of the Company and of each Guarantor who is satisfactory
to the Representative (i) confirming that such officers have carefully reviewed the Time of Sale Information and the Offering Memorandum and, to the knowledge of such officers, the representations set forth in Sections 3(a) and 3(b) hereof are true
and correct, (ii) confirming that the other representations and warranties of the Company and each of the Guarantors in this Agreement are true and correct and that the Company and each Guarantor has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date, (iii) confirming that, to the knowledge of such officers, except as described in each of the Time of Sale Information and the Offering Memorandum, (A)
there are no legal, governmental or regulatory investigations, actions, suits or proceedings pending to which the Company, the Guarantors or any of their respective subsidiaries is or may be a party or to which any property of the Company, the
Guarantors or any of their respective subsidiaries is or may be the subject which, individually or in the aggregate, if determined adversely to the Company, the Guarantors or any of their respective subsidiaries, could reasonably be expected to have
a Material Adverse Effect; (B) no such investigations, actions, suits or proceedings are threatened or contemplated by any governmental or regulatory authority or threatened by others; and (C) there are no current or pending legal, governmental or
regulatory actions, suits or proceedings that would be required to be disclosed on a registration statement on Form S-1 under the Securities Act and that are not so described in each of the Time of Sale Information and the Offering Memorandum, and
(iv) to the effect set forth in paragraphs (b) and (c) above. 
 (e)    Accountant’s Comfort
Letters. On the date of this Agreement and on the Closing Date, each of Ernst & Young LLP, Grant Thornton LLP and Weaver and Tidwell, L.L.P. shall have furnished to the Representative, at the request of the Company, letters, dated the
respective dates of delivery thereof and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representative, containing statements and information of the type customarily included in accountants’

 
“comfort letters” to Initial Purchasers with respect to the financial statements and certain financial information contained or incorporated by reference in each of the Time of Sale
Information and the Offering Memorandum; provided, that the letter delivered on the Closing Date shall use a “cut-off” date no more than three business days prior to the Closing Date. 

(f)    Engineer’s Comfort Letter. On the date of this Agreement and on the Closing Date, each of DeGolyer
and MacNaughton, and Huddleston & Co., Inc. shall have furnished to the Representative, at the request of the Company, letters, dated the respective dates of delivery thereof and addressed to the Initial Purchasers (i) confirming that it is an
independent petroleum engineering firm, (ii) confirming, as of such date, its estimates contained in the reserve reports, as of its date, with respect to: (A) the estimated quantities of the Company’s proved net reserves, (B) the future net
revenues from those reserves, (C) their present value as set forth in the Time of Sale Information and the Offering Memorandum and (D) such related matters as the Representative shall reasonably request. 

(g)    Chief Financial Officer’s Certificate. On the date of this Agreement and on the Closing Date, the
Representative shall have received from the chief financial officer of the Company a certificate, dated as of the date of this Agreement and the Closing Time, respectively, in the form attached as Exhibit B hereto, relating to the accuracy of
certain financial information contained in each of the Time of Sale Information and the Offering Memorandum. 

(h)    Opinion and 10b-5 Statement of Counsel for the Company. Haynes and Boone, LLP, counsel for the Company,
shall have furnished to the Representative, at the request of the Company, its written opinion and 10b-5 statement, dated the Closing Date and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representative,
to the effect set forth in Annex D hereto. 
 (i)    Opinion and 10b-5 Statement of Counsel for the Initial
Purchasers. The Representative shall have received on and as of the Closing Date an opinion and 10b-5 statement of Davis Polk & Wardwell LLP, counsel for the Initial Purchasers, with respect to such matters as the Representative may
reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters. 

(j)    No Legal Impediment to Issuance. No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date prevent the issuance or sale of the Securities; and no injunction or order of any federal,
state or foreign court shall have been issued that would, as of the Closing Date prevent the issuance or sale of the Securities. 

(k)    Good Standing. The Representative shall have received on and as of the Closing Date satisfactory evidence of
the good standing of the Company, the Guarantors and their respective subsidiaries in their respective jurisdictions of organization and their 

 
good standing as foreign entities in such other jurisdictions as the Representative may reasonably request, in each case in writing or any standard form of telecommunication from the appropriate
governmental authorities of such jurisdictions. 
 (l)    Registration Rights Agreement. The Initial
Purchasers shall have received a counterpart of the Registration Rights Agreement that shall have been executed and delivered by a duly authorized officer of the Company and each of the Guarantors. 

(m)    DTC. The Securities shall be eligible for clearance and settlement through DTC. 

(n)    Indenture and Securities. The Indenture shall have been duly executed and delivered by a duly
authorized officer of the Company, each of the Guarantors, and the Trustee, and the Securities shall have been duly executed and delivered by a duly authorized officer of the Company and duly authenticated by the Trustee. 

(o)    Amendment. On or prior to the Closing Date the Amendment shall have been entered into by the parties
thereto in form reasonably satisfactory to the Representative and the Initial Purchasers shall have received an executed copy thereof. 

(p)    Additional Documents. On or prior to the Closing Date, the Company and the Guarantors shall have
furnished to the Representative such further certificates and documents as the Representative may reasonably request. 
 All opinions,
letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers.

 7.    Indemnification and Contribution.

(a)    Indemnification of the Initial Purchasers. The Company and each of the Guarantors jointly and
severally agree to indemnify and hold harmless each Initial Purchaser, their affiliates, directors and officers and each person, if any, who controls such Initial Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, reasonable legal fees and other expenses incurred in connection with any suit, action or proceeding or any claim asserted, as such
fees and expenses are incurred), joint or several, that arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in the Preliminary Offering Memorandum, any of the other Time of Sale
Information, any Issuer Written Communication or the Offering Memorandum (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with any information relating to any Initial Purchaser furnished to the Company in writing by such 

 
Initial Purchaser through the Representative expressly for use therein, it being understood and agreed that the only such information furnished by any Initial Purchaser consists of the
information described as such in subsection (b) below. 
 (b)    Indemnification of the Company and the
Guarantors. Each Initial Purchaser agrees, severally and not jointly, to indemnify and hold harmless the Company, each of the Guarantors, each of their respective directors and officers and each person, if any, who controls the Company or
any of the Guarantors within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities
that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Initial Purchaser furnished to the Company in writing by
such Initial Purchaser through the Representative expressly for use in the Preliminary Offering Memorandum, any of the other Time of Sale Information, any Issuer Written Communication or the Offering Memorandum (or any amendment or supplement
thereto), it being understood and agreed upon that the only such information furnished by any Initial Purchaser consists of the following information in the Preliminary Offering Memorandum and the Offering Memorandum: the second and third sentence
of the seventh paragraph and the first sentence of the ninth paragraph. 
 (c)    Notice and Procedures. If any
suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such
person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying
Person shall not relieve it from any liability that it may have under paragraph (a) or (b) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and
provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under paragraph (a) or (b) above. If any such proceeding shall be
brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person (who shall not, without the consent of the
Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person in such proceeding and shall pay the fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified
Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i)) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available
to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and
representation of both parties by the same counsel would 

 
be inappropriate due to actual or potential differing interest between them. It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be paid or reimbursed as they are
incurred. Any such separate firm for any Initial Purchaser, its affiliates, directors and officers and any control persons of such Initial Purchaser shall be designated in writing by the Representative and any such separate firm for the Company, the
Guarantors, their respective directors and officers and any control persons of the Company and the Guarantors shall be designated in writing by the Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement
or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the
Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement. No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending
or threatened proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such
Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault,
culpability or a failure to act by or on behalf of any Indemnified Person. 
 (d)    Contribution. If the
indemnification provided for in paragraphs (a) or (b) above is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in
lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors, on the one hand, and the Initial Purchasers on the other, from the offering of the Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative fault of the Company and the Guarantors, on the one hand, and the Initial Purchasers on the other, in connection with the
statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company and the Guarantors, on the one hand, and the Initial
Purchasers on the other, shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses) received by the Company from the sale of the Securities and the total discounts and commissions

 
received by the Initial Purchasers in connection therewith, as provided in this Agreement, bear to the aggregate offering price of the Securities. The relative fault of the Company and the
Guarantors, on the one hand, and the Initial Purchasers on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Company or any Guarantor or by the Initial Purchasers and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 

(e)    Limitation on Liability. The Company, the Guarantors and the Initial Purchasers agree that it would not
be just and equitable if contribution pursuant to paragraph (d) above were determined by pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of paragraphs (d) and (e), in no event shall an
Initial Purchaser be required to contribute any amount in excess of the amount by which the total discounts and commissions received by such Initial Purchaser with respect to the offering of the Securities exceeds the amount of any damages that such
Initial Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Initial Purchasers’ obligations to contribute pursuant to paragraphs (d) and (e) are several in proportion to their
respective purchase obligations hereunder and not joint. 
 (f)    Non-Exclusive Remedies. The remedies provided
for in this Section 7 paragraphs (a) through (e) are not exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Person at law or in equity. 

8.    Effectiveness of Agreement. This Agreement shall become effective upon the execution and delivery hereof
by the parties hereto. 
 9.    Termination. This Agreement may be terminated in the absolute discretion of the
Representative, by notice to the Company, if after the execution and delivery of this Agreement and on or prior to the Closing Date (a) trading generally shall have been suspended or materially limited on or by any of the New York Stock Exchange or
The Nasdaq Stock Market; (b) trading of any securities issued or guaranteed by the Company or any of the Guarantors shall have been suspended on any exchange or in any over-the-counter market; (c) a general moratorium on commercial banking
activities shall have been declared by federal or New York State authorities; or (d) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis, either within or outside the
United States, that, in the judgment of the Representative, is material and adverse and makes it impracticable or inadvisable to 

 
proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum. 

10.    Defaulting Initial Purchaser.

(a)    If, on the Closing Date, any Initial Purchaser defaults on its obligation to purchase the Securities that it has
agreed to purchase hereunder on such date, the non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such Securities by other persons satisfactory to the Company on the terms contained in this Agreement. If,
within 36 hours after any such default by any Initial Purchaser, the non-defaulting Initial Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours within which to procure
other persons satisfactory to the non-defaulting Initial Purchasers to purchase such Securities on such terms. If other persons become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the non-defaulting
Initial Purchasers or the Company may postpone the Closing Date for up to five full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Representative may be necessary in the Time of Sale
Information, the Offering Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to the Time of Sale Information or the Offering Memorandum that effects any such changes. As
used in this Agreement, the term “Initial Purchaser” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases
Securities that a defaulting Initial Purchaser agreed but failed to purchase. 
 (b)    If, after giving effect to any
arrangements for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate principal amount of such Securities
that remains unpurchased on the Closing Date does not exceed one-eleventh of the aggregate principal amount of all the Securities to be purchased on such date, then the Company shall have the right to require each non-defaulting Initial Purchaser to
purchase the principal amount of Securities that such Initial Purchaser agreed to purchase hereunder on such date plus such Initial Purchaser’s pro rata share (based on the principal amount of Securities that such Initial Purchaser agreed
to purchase hereunder on such date) of the Securities of such defaulting Initial Purchaser or Initial Purchasers for which such arrangements have not been made. 

(c)    If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Initial Purchaser or
Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that remains unpurchased on the Closing Date exceeds one-eleventh of the aggregate
principal amount of all the Securities to be purchased on such date, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement shall terminate without liability on the part of the non-defaulting Initial
Purchasers. Any termination of this Agreement pursuant to this Section 10 shall be without liability on the part of the Company or the Guarantors, except that the Company 

 
and each of the Guarantors will continue to be liable for the payment of expenses as set forth in Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate and
shall remain in effect. 
 (d)    Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability
it may have to the Company, the Guarantors or any non-defaulting Initial Purchaser for damages caused by its default. 

11.    Payment of Expenses.  

(a)    Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the
Company and each of the Guarantors jointly and severally agree to pay or cause to be paid all costs and expenses incident to the performance of their respective obligations hereunder, including without limitation, (i) the costs incident to the
authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (ii) the costs incident to the preparation and printing of the Preliminary Offering Memorandum, any other Time of Sale
Information, any Issuer Written Communication and the Offering Memorandum (including any amendment or supplement thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the
fees and expenses of the Company’s and the Guarantors’ counsel and independent accountants; (v) the fees and expenses incurred in connection with the registration or qualification and determination of eligibility for investment of the
Securities under the laws of such jurisdictions as the Representative may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including the related fees and expenses of counsel for the Initial Purchasers); (vi)
any fees charged by rating agencies for rating the Securities; (vii) the fees and expenses of the Trustee and any paying agent (including related fees and expenses of any counsel to such parties); (viii) all expenses and application fees
incurred in connection with the approval of the Securities for book-entry transfer by DTC; (ix) all expenses incurred by the Company in connection with any “road show” presentation to potential investors. 

(b)    If (i) this Agreement is terminated pursuant to Section 9, (ii) the Company for any reason fails to tender the
Securities for delivery to the Initial Purchasers or (iii) the Initial Purchasers decline to purchase the Securities for any reason permitted under this Agreement, the Company and each of the Guarantors jointly and severally agrees to reimburse the
Initial Purchasers for all out-of-pocket costs and expenses (including the reasonable fees and expenses of their counsel) reasonably incurred by the Initial Purchasers in connection with this Agreement and the offering contemplated hereby. 

12.    Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and directors and any controlling persons referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. No purchaser of Securities from any Initial Purchaser shall be deemed to be a successor merely by reason of such purchase. 

 13.    Survival. The respective indemnities, rights of
contribution, representations, warranties and agreements of the Company, the Guarantors and the Initial Purchasers contained in this Agreement or made by or on behalf of the Company, the Guarantors or the Initial Purchasers pursuant to this
Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Securities and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf
of the Company, the Guarantors or the Initial Purchasers. 
 14.     Certain Defined Terms. For
purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which
banks are permitted or required to be closed in New York City; (c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act; (d) the term “Exchange Act” means the Securities Exchange Act of 1934, as
amended; (e) the term “written communication” has the meaning set forth in Rule 405 under the Securities Act; and (f) the term “significant subsidiary” has the meaning set forth in Rule 1-02 of Regulation S-X under the Exchange
Act. 
 15.    Compliance with USA Patriot Act. In accordance with the requirements of the USA Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the Initial Purchasers are required to obtain, verify and record information that identifies their respective clients, including the Company and the Guarantors, which information may
include the name and address of their respective clients, as well as other information that will allow the Initial Purchasers to properly identify their respective clients. 

16.    Miscellaneous.

(a)    Authority of the Representative. Any action by the Initial Purchasers hereunder may be taken by J.P.
Morgan Securities LLC on behalf of the Initial Purchasers, and any such action taken by J.P. Morgan Securities LLC shall be binding upon the Initial Purchasers.

(b)    Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have
been duly given if mailed or transmitted and confirmed by any standard form of telecommunication. Notices to the Initial Purchasers shall be given to the Representative to c/o J.P. Morgan Securities LLC, 383 Madison Avenue, New York, New York,
10179 (fax: 212-270-1063), Attention: Jack Smith. Notices to the Company and the Guarantors shall be given to them at Callon Petroleum Company, 200 North Canal St., Natchez, Mississippi 39120; Attention: Joseph C. Gatto, Jr. 

(c)    Governing Law. This Agreement and any claim, controversy or dispute arising under or related to this
Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed in such state. 

 (d)    Submission to Jurisdiction. The Company and each of the
Guarantors hereby submit to the exclusive jurisdiction of the U.S. federal and New York state courts in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby. The Company and each of the Guarantors waive any objection which it may now or hereafter have to the laying of venue of any such suit or proceeding in such courts. Each of the Company and each of the Guarantors agrees
that final judgment in any such suit, action or proceeding brought in such court shall be conclusive and binding upon the Company and each Guarantor, as applicable, and may be enforced in any court to the jurisdiction of which Company and each
Guarantor, as applicable, is subject by a suit upon such judgment.
 (e)    Waiver of Jury
Trial. Each of the parties hereto hereby waives any right to trial by jury in any suit or proceeding arising out of or relating to this Agreement. 

(f)    Counterparts. This Agreement may be signed in counterparts (which may include counterparts delivered by
any standard form of telecommunication), each of which shall be an original and all of which together shall constitute one and the same instrument. 

(g)    Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or
approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto. 

(h)    Headings. The headings herein are included for convenience of reference only and are not intended to be
part of, or to affect the meaning or interpretation of, this Agreement. 

 If the foregoing is in accordance with your understanding, please indicate your acceptance of
this Agreement by signing in the space provided below. 
  

			
	Very truly yours,
	
	CALLON PETROLEUM COMPANY
		
	By:	 	 /s/ Joseph C. Gatto Jr.

		 	Name: Joseph C. Gatto Jr.
		 	Title:   President, Chief Financial Officer and Treasurer
	
	CALLON PETROLEUM OPERATING COMPANY
		
	By:	 	 /s/ Joseph C. Gatto Jr.

		 	Name: Joseph C. Gatto Jr.
		 	Title:   President, Chief Financial Officer and Treasurer

 Accepted: As of the date first written above 
  

			
	J.P. MORGAN SECURITIES LLC
		
	By:	 	 /s/ Jack Smith

		 	 Authorized Signatory

 For itself and on behalf of the several Initial Purchasers listed in Schedule 1 hereto. 

  
 [Signature
page to Purchase Agreement] 

 Schedule 1 
  

					
	 Initial Purchaser
	  	Principal Amount
of Securities	 
	 J.P. Morgan Securities LLC
	  	$	144,330,000	  
	 Credit Suisse Securities (USA) LLC
	  	$	72,165,000	  
	 Citigroup Global Markets Inc.
	  	$	39,176,000	  
	 RBC Capital Markets, LLC
	  	$	39,176,000	  
	 Capital One Securities, Inc.
	  	$	24,743,000	  
	 Barclays Capital Inc.
	  	$	11,340,000	  
	 KeyBanc Capital Markets Inc.
	  	$	11,340,000	  
	 Regions Securities LLC
	  	$	11,340,000	  
	 Scotia Capital (USA) Inc.
	  	$	11,340,000	  
	 Seaport Global Securities LLC
	  	$	11,340,000	  
	 SunTrust Robinson Humphrey, Inc.
	  	$	11,340,000	  
	 BOK Financial Securities, Inc.
	  	$	6,185,000	  
	 IBERIA Capital Partners L.L.C.
	  	$	6,185,000	  
		  	  
	  
	 
	 Total
	  	$	400,000,000	  
		  	  
	  
	 

  
 Schedule 1-1 

 Schedule 2 

Significant Subsidiaries 

Callon Petroleum Operating Company 

  
 Schedule 2-1 

 Annex A 

Additional Time of Sale Information 

1.    Term sheet containing the terms of the Securities, substantially in the form of Annex B. 

  
 Annex A-1 

 Annex B 

Callon Petroleum Company 

$400,000,000 6.125% Senior Notes due 2024 

September 15, 2016 
 The information in this
pricing term sheet supplements the Preliminary Offering Memorandum of Callon Petroleum Company (the “Company”) dated September 12, 2016 (the “Preliminary Offering Memorandum”) and updates and supersedes the information
in the Preliminary Offering Memorandum to the extent it is inconsistent with the information in the Preliminary Offering Memorandum. Terms used and not defined herein have the meanings assigned in the Preliminary Offering Memorandum. 

 

					
	Issuer	  	Callon Petroleum Company
		
	Title of Securities	  	6.125% Senior Notes due 2024 (the “Notes”)
		
	Aggregate Principal Amount	  	$400,000,000
		
	Distribution	  	144A/Regulation S with Registration Rights
		
	Maturity Date	  	October 1, 2024
		
	Issue Price	  	100.000%
		
	Coupon	  	6.125%
		
	Yield to Maturity	  	6.125%
		
	Benchmark Treasury	  	UST 2.375% due August 15, 2024
		
	Spread to Benchmark Treasury	  	453 basis points
		
	Interest Payment Dates	  	April 1 and October 1 of each year, beginning on April 1, 2017
		
	Ratings*	  	B3 (Moody’s) / B+ (S&P)
		
	Trade Date	  	September 15, 2016
		
	Settlement Date	  	October 3, 2016 (T+12)
		
	Make-Whole Redemption	  	Make-whole redemption at Treasury Rate + 50 basis points prior to October 1, 2019
		
	Optional Redemption	  	On or after October 1, 2019 at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, on the Notes redeemed during the twelve-month period indicated
beginning on October 1 of the years indicated below:
			
	 	  	 Year
	  	Price
	  	2019	  	104.594%
	  	2020	  	103.063%
	  	2021	  	101.531%
	  	2022 and thereafter	  	100.000%

  
 Annex B-1 

							
	 Equity Clawback
	  	Up to 35% at 106.125% prior to October 1, 2019
		
	 Change of Control
	  	101% plus accrued and unpaid interest
		
	 Joint Book-Running Managers
	  	 J.P. Morgan Securities LLC
 Credit
Suisse Securities (USA) LLC
 Citigroup Global Markets Inc.
 RBC
Capital Markets, LLC
 Capital One Securities, Inc.

		
	 Co-Managers
	  	 Barclays Capital Inc.
 KeyBanc
Capital Markets Inc.
 Regions Securities LLC
 Scotia Capital
(USA) Inc.
 Seaport Global Securities LLC
 SunTrust Robinson
Humphrey, Inc.
 BOK Financial Securities, Inc.
 IBERIA Capital
Partners L.L.C.

		
	 CUSIP Numbers
	  	 Rule 144A: 13123X AR3
 Regulation S:
U1303X AC0

		
	 ISIN Numbers
	  	 Rule 144A: US13123XAR35
 Regulation
S: USU1303XAC03

		
	 Denominations
	  	Minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof

  
  

 

	*	Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time 

We expect that delivery of the notes will be made against payment therefor on or about the closing date specified on the cover page of this offering
memorandum, which will be the twelfth business day following the date of this offering memorandum (such settlement being referred to as “T+12”). Under Rule 15c6-1 under the Exchange Act, trades in the secondary market are required to
settle in three business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade notes on the date of pricing or the next succeeding seven business days will be required, by virtue of the fact
that the notes initially settle in T+12, to specify an alternate settlement arrangement at the time of any such trade to prevent a failed settlement. Purchasers of the notes who wish to trade the notes on the date of pricing or the
next succeeding twelfth business days should consult their advisors. 
 This material is strictly confidential and has been prepared by the
Issuer solely for use in connection with the proposed offering of the securities described in the Preliminary Offering Memorandum. This material is personal to each offeree and does not constitute an offer to any other person or the public generally
to subscribe for or otherwise acquire the securities. Please refer to the Preliminary Offering Memorandum for a complete description. 
 The
securities have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and are being offered only to (1) “qualified institutional buyers” as defined in Rule 144A under the Securities Act and (2)
outside the United States to non-U.S. persons in compliance with Regulation S under the Securities Act, and this communication is only being distributed to such persons. 

  
 Annex B-2 

 This communication is not an offer to sell the securities and it is not a solicitation of an offer to buy the
securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. 
 Any disclaimer or
other notice that may appear below is not applicable to this communication and should be disregarded. Such disclaimer or notice was automatically generated as a result of this communication being sent by Bloomberg or another email system.

  
 Annex B-3 

 Annex C 

Restrictions on Offers and Sales Outside the United States 

In connection with offers and sales of Securities outside the United States: 

(a)    Each Initial Purchaser acknowledges that the Securities have not been registered under the Securities Act and may
not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an exemption from, or in transactions not subject to, the registration requirements of the Securities Act. 

(b)    Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that: 

(i)    Such Initial Purchaser has offered and sold the Securities, and will offer and sell the Securities,
(A) as part of their distribution at any time and (B) otherwise until 40 days after the later of the commencement of the offering of the Securities and the Closing Date, only in accordance with Regulation S under the Securities Act
(“Regulation S”) or Rule 144A or any other available exemption from registration under the Securities Act. 

(ii)    None of such Initial Purchaser or any of its affiliates or any other person acting on its or their
behalf has engaged or will engage in any directed selling efforts with respect to the Securities, and all such persons have complied and will comply with the offering restrictions requirement of Regulation S. 

(iii)    At or prior to the confirmation of sale of any Securities sold in reliance on Regulation S, such
Initial Purchaser will have sent to each distributor, dealer or other person receiving a selling concession, fee or other remuneration that purchases Securities from it during the distribution compliance period a confirmation or notice to
substantially the following effect: 
 The Securities covered hereby have not been registered under the U.S. Securities Act of 1933, as
amended (the “Securities Act”), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons (i) as part of their distribution at any time or (ii) otherwise until 40 days after the
later of the commencement of the offering of the Securities and the date of original issuance of the Securities, except in accordance with Regulation S or Rule 144A or any other available exemption from registration under the Securities
Act. Terms used above have the meanings given to them by Regulation S. 

 (iv)    Such Initial Purchaser has not and will not enter
into any contractual arrangement with any distributor with respect to the distribution of the Securities, except with its affiliates or with the prior written consent of the Company. 

Terms used in paragraph (a) and this paragraph (b) and not otherwise defined in this Agreement have the meanings given to them by Regulation S.

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