Document:

Purchase and Sale Agreement

 Exhibit 10.1 
  
 PURCHASE AND SALE AGREEMENT 
  
 This Purchase and Sale Agreement (this “Agreement”) is entered into this 31st day of October, 2005, by and between MILLENNIUM
OFFSHORE GROUP, INC., a Texas corporation (“Seller”), and ATP OIL & GAS CORPORATION, a Texas corporation, (“Buyer”). Buyer and Seller are collectively referred to herein as the “Parties” and
sometimes individually referred to as a “Party.” 
  
 RECITALS: 
  

	A.	Seller desires to sell and transfer to Buyer certain oil and gas properties and other assets on the terms and conditions set forth in this Agreement. 

  

	B.	Buyer desires to acquire from Seller such assets on the terms and conditions set forth in this Agreement. 

  
 WITNESSETH: 
  

	  	In consideration of the mutual agreements contained in this Agreement, Buyer and Seller agree as follows: 

  

	1.	SALE AND PURCHASE OF THE ASSETS. 

  

	 	1.1	Acquired Assets. Subject to the terms and conditions of this Agreement, Seller agrees to transfer, convey and deliver to Buyer and Buyer agrees to acquire from Seller, as of
the Effective Date (as defined in Article 3), all of Seller’s right, title and interest in and to the following (collectively, the “Assets”): 

  

	 	(A)	(i) All the leasehold interests, mineral interests, royalty interests, overriding royalty interests, reversionary rights, production payments, net profits interests, and
contractual rights to production attributable to the lands described in Exhibit 1.1(A)-1 (collectively the “Leases”); (ii) all wells located on the Leases in which Seller owns an interest (collectively the “Wells”);
(iii) the easements, rights of way, and other rights, privileges, benefits and powers with respect to the use and occupation of the Leases; (iv) any pooled or unitized acreage located in whole or in part within each Lease, and the
interests in any wells within the unit or pool associated with such Lease (collectively the “Units”), regardless of whether such unit or pool production comes from wells located within or without the Leases; 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	(B)	The oil and gas and associated hydrocarbons, crude oil, natural gas, condensate (“Oil and Gas”) after the Effective Date, in, under and produced from or otherwise
attributable to the Leases, Units, and Wells; 

  

	 	(C)	To the extent assignable and applicable to the Assets, all licenses, servitudes, gas purchase and sale contracts, gathering contracts, crude purchase and sale agreements, farmin
agreements, farmout agreements, bottom hole contribution agreements, acreage contribution agreements, operating agreements, unit agreements, processing agreements, options, leases of equipment or facilities, joint venture agreements, pooling
agreements, transportation agreements, rights-of-way and other contracts, agreements and rights, which are owned by Seller, in whole or in part, and relate to any of the Leases or the production of Oil and Gas from the Leases, to the extent that the
same are in force and effect and relate to periods after the Effective Date (collectively, the “Contracts”); 

  

	 	(D)	The real, personal and mixed property and facilities, to the extent situated upon and exclusively used, or situated upon and held exclusively for use, by Seller in connection with
its ownership (in whole or part) or operation of the Leases, including, without limitation, well equipment, casing, tanks, crude oil, natural gas, condensate or products in storage severed after the Effective Date; tubing, compressors, pumps,
motors, fixtures, platforms, tools, machinery and other equipment; pipelines; gathering lines, field processing equipment; inventory and all other improvements used in the operation of the Leases (except geophysical and seismic records, data and
information owned by Seller unless as otherwise provided herein) (the “Related Assets”). A list of the major Related Assets are further described in Exhibit 1.1(A)-2; 

  

	 	(E)	To the extent assignable, all governmental permits, licenses and authorizations, as well as any applications for the same, related to the Leases or the Wells or the ownership or
operation or the use thereof; and 

  

	 	(F)	All of Seller’s files, records and data relating to the items described in subsections (A), (B), (C), (D), and (E) above, including, without limitation, title records
(title curative documents); surveys, maps and drawings; contracts; correspondence; geological records and information; production records, electric logs, core data, pressure data, decline curves, graphical production curves and all related matters
and construction documents, except (i) to the extent the transfer, delivery or copying of such records may be restricted by contract with a third party; (ii) all documents and instruments of Seller that may be protected by the
attorney-client privilege; (iii) all accounting and Tax files, books, records, Tax returns and Tax work papers related to such items; and (iv) any of Seller’s seismic data or seismic data licensed from a third party provided that
Seller shall grant a license to Buyer for Seller’s proprietary geophysical and seismic records that are not restricted by contract with a 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	third party (collectively, the “Records”). In the event Seller provides Buyer a license to its proprietary geophysical and seismic records, Buyer shall be responsible for
all copying costs. 

  

	 	1.2	Excluded Assets. Notwithstanding the foregoing, the Assets shall not include, and there is excepted, reserved and excluded from the purchase and sale contemplated herein
those items listed in Exhibit 1.2 (the “Excluded Assets”), including but not limited to portions of (i) South Timbalier Block 77 bearing MMS Serial Number OCS-G 04827 and (ii) High Island Block 74 bearing MMS Serial Number OCS-G
21348, as further described in Article 17.10 hereof. 

  

	 	1.3	Assumed Liabilities. On the Closing Date, Buyer shall assume and agree to timely and fully pay, perform and otherwise discharge, without recourse to Seller or its affiliates,
all of the liabilities and obligations of Seller and its affiliates, successors, assigns or representatives, direct or indirect, known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, which relate directly, or
indirectly, to the Assets, including but not limited to, Environmental Laws (as defined herein), taxes, securities law, personal injury, plugging, abandonment and surface restoration, and all liabilities and obligations under the Oil and Gas,
Leases, Wells, Contracts, Related Assets and Records, which relate to the Assets (other than the Excluded Assets), whether such liabilities and obligations accrue before, on or after the Effective Date (collectively, the “Assumed
Liabilities”). Notwithstanding the foregoing, Assumed Liabilities shall not include, and there is excepted, reserved and excluded from such Assumed Liabilities, the liabilities and obligations for which Seller indemnifies Buyer against pursuant
to Article 16.1. 

  

	 	1.4	Imbalances. The Parties shall settle all production imbalances relating to the Assets in a letter agreement (“Imbalance Agreement”) to be delivered at Closing. All
adjustments to said production imbalances shall be made post-Closing as further described in Article 2.4 (B). The Imbalance Agreement shall be made a part of this Agreement as Exhibit 7. 

  

	 	1.5	Transition Period for Operator and Bonding Responsibilities. Seller is the Operator of certain of the Leases and Seller has bonding responsibility for certain of the Leases,
and in most, if not all, instances Seller has both responsibilities with respect to each of the affected Leases (collectively the “Transition Leases”), a list of which is attached hereto as Exhibit 1.5. Seller understands that Buyer
intends to qualify for an exemption from bonding with the Minerals Management Service (“MMS”) and shall file the necessary application and documents with the MMS to obtain the exemption within a reasonable period after Buyer has obtained
audited financial statements for YE 2005. The process of obtaining this exemption is expected to take from six to nine months after such application is made to the MMS. From and after the Closing Date until Buyer successfully qualifies for an
exemption from bonding with the MMS and notifies Seller of such exemption as provided in Article 4.2 (D), Seller will, with respect to the Transition Leases, continue, as applicable, to hold the position of Operator with 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	the MMS and maintain the bonds that were in effect on the Effective Date (“Transition Period”). Buyer will, after receipt of an invoice from Seller, make advance payment
to Seller of any premiums that must soon be paid in order to maintain the bonds during the Transition Period. During the Transition Period Seller will: 

  

	 	(a)	Provide Buyer with any notices, letters or other forms of communication from (i) the MMS or other governmental entity concerning any of the Transition Leases, and (ii) the
underwriter, surety or bonding company providing the bonds for the Transition Leases. 

  

	 	(b)	If Buyer requests Seller’s assistance during the Transition Period, Seller will act on Buyer’s behalf. When acting on Buyer’s behalf hereunder, Seller agrees to work
with Buyer to prepare and submit any and all documents, on the appropriate Seller letterhead, or take other reasonable actions which Buyer considers necessary and appropriate. While acting on Buyer’s behalf hereunder, Seller shall make a good
faith effort to provide Buyer with copies of all documents and communications associated with the requested assistance, including all documents and communications sent to or received from the MMS. 

  

	2.	PURCHASE PRICE AND CONTINGENT CONSIDERATION. 

  

	 	2.1	Purchase Price. The purchase price for the Assets shall be Forty Million Dollars ($40,000,000.00), subject to the adjustment, if any, set forth in Article 2.4 (A), hereafter
the “Purchase Price.” The Purchase Price shall be subject to the adjustments provided for in Article 2.4 (B), and the total dollar amount after all adjustments have been made under this Agreement is hereinafter referred to as the
“Adjusted Purchase Price.” In addition to the Purchase Price, Seller shall also be entitled to the Contingent Consideration described in Article 2.5. 

  

	 	2.2	Payment. After all assignments and forms described in Article 4.2 have been properly executed by Seller, the Buyer shall pay the Purchase Price in accordance with the
provisions in Article 2.2 (A) and (B) below. 

  

	 	(A)	The Seller entered into a Credit Agreement with NGP Capital Resources Company (“NGP”) on August 4, 2005, and mortgaged certain of its Assets (the “Mortgage’),
and agreed to provide NGP with a 2% overriding royalty interest on the mortgaged Assets (the “NGP ORRI”). In full satisfaction of the referenced Mortgage and the NGP ORRI (as of the Effective Date), Buyer will pay into NGP’s account
(set forth below) by Electronic Funds Transfer (“EFT”) $23,511,687.05 (the “NGP Payment”). 

  

	 	  	Wells Fargo Bank 

	 	  	Houston, Texas 

	 	  	ABA 121 000 248 

	 	  	For credit to NGP Capital Resources Company 

	 	  	Account number 614-4108-146 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	(B)	After Buyer’s receipt of a facsimile or original of the Mortgage Release and NGP ORRI Assignment (as defined in Article 4.2 (B) below), Buyer will pay $16,488,312.95
(i.e., being the balance of the Purchase Price after deducting the NGP Payment) into Seller’s account (set forth below) by EFT. 

  

	 	  	Amegy Bank 

	 	  	Houston, Texas 

	 	  	ABA #113011258 

	 	  	A/C No. 3348814 

	 	  	Account Name: Millennium Offshore Group, Inc. 

  

	 	2.3	Allocation. The Purchase Price shall be allocated to the Assets in accordance with the schedule of values set forth in Exhibit 3. Seller and Buyer covenant and agree that the
values allocated to various portions of the Assets, which are set forth on Exhibit 3 (singularly with respect to each item, the “Allocated Value” and, collectively, the “Allocated Values”), shall be binding on Seller and Buyer.

  

	 	2.4	Adjustments to Purchase Price.. 

  

	 	(A)	At Closing, the Parties shall, if appropriate, account to one another for (i) proceeds from production from the Leases as of and following the Effective Date and
(ii) costs and expenses associated with the Assets, except as otherwise provided in this Agreement, as of and following the Effective Date as provided for in any applicable operating agreement or other agreements affecting the Assets. Such
proceeds and costs will be calculated by Seller and provided to the Buyer, in the form of a detailed statement, prior to the Closing (“Closing Statement”). Any proceeds and costs not captured in the Closing Statement (if timely provided),
shall be dealt with in the Post-Closing Statement prepared as provided in Article 2.4 (B) below. 

  

	 	(B)	A post-closing adjustment statement based on the actual revenue and expenses related to the Assets shall be prepared and delivered by Seller to Buyer on January 31, 2006,
proposing further adjustments to the Purchase Price based on the information then available (“Post-Closing Statement”). Seller or Buyer, as the case may be, shall be given access to and shall be entitled to review and audit the other
Party’s records pertaining to the computation of amounts claimed in such Post-Closing Statement. Except for adjustment made based on the Post-Closing Statement, if any, no additional adjustments shall be made for proceeds from production and
for costs and expenses associated with the Assets from the Effective Date to Closing Date. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	2.5	Contingent Consideration. Buyer shall pay Ten Million Dollars ($10,000,000.00), the “Contingent Consideration”, by EFT into Seller’s account (set forth in
Article 2.2 (B) above) within three (3) business days after Buyer’s receipt of a written notice by facsimile from Seller that references this provision and contains a schedule providing evidence that the cumulative net production
volume from the Assets, on and after the Effective Date, has met or exceeded one (1) BCFE. 

  

	3.	EFFECTIVE DATE. The effective date for the conveyance of the Assets shall be as of 12:01 a.m., local time at the location of the Leases on October 1, 2005, (the
“Effective Date”). 

  

	4.	CLOSING AND POST-CLOSING. 

  

	 	4.1	Closing and Document Review. Subject to the conditions precedent set forth at Articles 10 and 11 and any termination pursuant to Article 12, the sale and purchase of the
Assets (“Closing”) shall be held on October 31, 2005, or such later date that is mutually acceptable to the Parties (“Closing Date”). The Closing will take place at the offices of Buyer at 4600 Post Oak Place, Suite 200,
Houston, Texas 77027. Prior to the Closing Date, the Parties will have the opportunity to review and examine all documents described in Article 4.2 below, which will be executed at Closing. 

  

	 	4.2	Delivery by Seller. Seller shall deliver the following to Buyer at Closing and after Closing as further specified below. 

  

	 	(A)	Assignments. At Closing, Seller shall properly execute, witness, acknowledge, and deliver to Buyer six (6) original counterparts of each of the following instruments, as
applicable to each Lease, in complete fulfillment of Seller’s obligation to properly convey to Buyer all of Seller’s right, title, and interest in the Assets: a mutually acceptable form of Record Title Assignment and Bill of Sale,
Assignment of Operating Rights and Bill of Sale, Assignment and Bill of Sale, Assignment of Right-of-Way and Assignment of State Lease. These instruments will be in the same form as those assignment forms attached on Exhibits 4.1 through 4.5. Seller
will receive one fully executed counterpart of each assignment, and Buyer will retain the remainder. 

  

	 	(B)	Release of Mortgage and NGP ORRI Assignment. At Closing, Seller shall deliver to Buyer a facsimile or original of the (i) release of the Mortgage, executed by NGP,
effective as of 12:01 a.m. local time at the location of the Leases on October 1, 2005 (“Mortgage Release”), and (ii) an assignment of NGP ORRI, executed by NGP and Seller, effective as of 12:01 a.m. local time at the location of
the Leases on October 1, 2005, assigning to Seller the two percent (2%) overriding royalty interest on the mortgaged Assets (“NGP ORRI Assignment”). If a facsimile of the 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	Mortgage Release, NGP ORRI Assignment, or both is delivered to Buyer at Closing, then an original of each such facsimile document shall be delivered to Buyer no later than the day
after the Closing Date. 

  

	 	(C)	Governmental Forms for Non-Transition Leases. With respect to those Leases that are not Transition Leases (“Non-Transition Leases”), at Closing Seller shall
properly execute and deliver the necessary governmental forms (in the needed number of counterparts), as applicable, to designate Buyer as the Operator of the Non-Transition Leases where Seller was the Operator on the Effective Date; including, but
not limited to, Forms MMS-1123, MMS-1017, and MMS-1022. 

  

	 	(D)	Governmental Forms for Transition Leases. With respect to those Leases that are Transition Leases, Seller will prepare and deliver to Buyer the necessary governmental forms
for the Buyer’s designation of Seller as the Operator of the Transition Leases during the Transition Period. These forms will either be provided at Closing or within four (4) business days after Closing. Within five (5) business days
after Seller’s receipt of a notice from Buyer informing Buyer that Seller has resolved its Bonding Requirements with respect to the Assets, Seller shall properly execute and deliver the necessary governmental forms (in the needed number of
counterparts), as applicable, to designate Buyer as the Operator of the Transition Leases; including, but not limited to, Forms MMS-1123, MMS-1017, and MMS-1022. 

  

	 	(E)	Records and Contracts. It is understood that Seller will require access to the Records and Contracts given the structure of the transactions in this Agreement, however,
within a reasonable time after Seller’s receipt of notice from Buyer (whether one or more), the Seller will deliver to Buyer such copies of the requested Contracts, Records, or both, regarding the Assets. At such time as Seller ceases its
contractual agreement to operate the certain of the Assets, the originals (or copies, if originals are not available) of the Contracts and Records will be delivered to Buyer. 

  

	 	4.3	Further Cooperation. At the Closing, and thereafter as may be necessary, Seller and Buyer shall execute and deliver such other instruments and documents and take such other
actions as may be reasonably necessary to evidence and effectuate the transactions contemplated by this Agreement, including correcting errors and omissions in the Closing documents. This further cooperation will extend to the period after the
Transition Period, when Seller will provide reasonable assistance to Buyer, as needed, to obtain the needed governmental forms (including Forms MMS-1123, MMS-1017, and MMS-1022) from third parties, owning an interest in the Transition Leases, to
effectuate the designation of Buyer as Operator of the Transition Leases. 

  

	5.	GENERAL ACCESS AND REVIEW OF ASSETS. Seller shall provide Buyer free access to the Assets and to all of its Records for Buyer’s examination. In addition, Seller shall
allow Buyer to conduct a physical and environmental examination of the Assets at Buyer’s cost, risk and expense. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	6.	TITLE. 

  

	 	6.1	Examination. Following the execution of this Agreement, Buyer shall conduct such examination of the title to the Leases, based upon the Contracts and Leases and the public
data, as is deemed appropriate by Buyer, at its sole cost, risk and expense. The purpose of such title examination shall be to determine if Seller has “Good and Marketable Title” to its interest in the Leases and Wells.

  

	 	6.2	Good and Marketable Title. As used herein the term “good and marketable title” shall mean: 

  

	 	(A)	As to each of the Leases and Wells, that Seller’s record title, operating rights or Working Interest (whichever may be applicable): 

  

	 	(i)	entitles Seller to receive from each Lease or Well not less than the interests shown in Exhibits 1.1(A)-1 as the “Net Revenue Interest” of all Oil and Gas produced,
saved and marketed from each Lease and Well and of all Oil and Gas produced, saved and marketed from any unit of which each Lease or Well is a part and allocated to such Lease or Well, all without reduction, suspension or termination of the
interests in each Lease or Well throughout the duration of such Lease or the Lease upon which such Well is located, except as stated in such Exhibit; and 

  

	 	(ii)	obligates Seller to bear a percentage of the costs and expenses relating to the maintenance and development of, and operations relating to, the Leases and Wells not greater than the
“Working Interest” shown in Exhibits 1.1(A)-1, all without increase of the interests in each Lease and Well throughout the duration of such Lease and Well, except as stated in such Exhibit. 

  

	 	(B)	That title of Seller to the Assets; 

  

	 	(i)	at Closing, is free and clear of liens, encumbrances (except for Permitted Encumbrances as defined in Article 6.5), including, but not limited to claims, demands, damages,
liabilities, judgments and causes of action and operational restrictions; and 

  

	 	(ii)	with respect to real property interests to be transferred to Buyer, real property interests are of record in the relevant counties and governmental offices; and

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	(iii)	with respect to any Asset subject to preferential rights, such rights have been waived and consents obtained from all third parties. 

  

	 	6.2.1	Title Defect Remedy. 

  

	 	(A)	No later than forty-five (45) the business days after the Closing Date, Buyer may notify Seller in writing (“Title Notice”) of any liens, charges, contracts,
agreements obligations, encumbrances, defects and irregularities of title which would cause title to all or part of the Assets not to be good and marketable as defined in Section 6.2 hereof, or which would cause a breach of a representation or
warranty of Seller (“Title Defect”). Such Title Notice shall describe in reasonable detail the Title Defect and include the estimated value of the Title Defect. 

  

	 	(B)	If a Title Defect as set forth in a Title Notice is given to Seller as set forth above and is not cured to Buyer’s satisfaction within 30 days, then at Seller’s option the
affected Assets shall be removed from this Agreement, conveyed to Seller by Buyer, and the value of such removed Assets will be reflected in the Post-Closing Statement as a downward adjustment of the Purchase Price, or, if the Post-Closing Statement
has already been rendered, Seller shall make payment to Buyer of such amount at the time of the conveyance to Seller. Any Title Defect waived by Buyer under this Section shall become a Permitted Encumbrance as defined herein.

  

	 	(C)	No adjustment to Purchase Price. Notwithstanding anything to the contrary in this Article 6, there shall be no adjustments to the Purchase Price for Title Defects unless the total
adjustment shall exceed One Million Dollars ($1,000,000) in the aggregate. 

  

	 	6.3	Special Warranty. The documents to be executed and delivered by Seller to Buyer transferring the Assets to Buyer shall be subject to the Permitted Encumbrances. Seller shall
warrant and defend the title to the Assets unto Buyer against any claims and demands of all persons lawfully claiming the Assets or any part thereof, by, through or under Seller, but not otherwise; and Assignee shall have the right of full
substitution and subrogation in and to all actions in warranty. Seller shall further warrant and represent that the Assets are free and clear of all liens (including, but not limited to, all U.C.C. liens), burdens (except those identified herein and
those assumed by Assignee under the terms of this Agreement) and claims arising by, through or under Assignor. Seller’s interests in the Assets are to be sold AS IS AND WHERE IS AND WITHOUT WARRANTY OF MERCHANTABILITY, CONDITION OR FITNESS FOR
A PARTICULAR PURPOSE, EITHER EXPRESS OR IMPLIED. 

  

	 	6.4	Successor Operator. Buyer acknowledges and agrees that Seller cannot and does not covenant or warrant that Buyer shall become successor operator of all or any portion of the
Assets, since the Assets or portions thereof may be subject to unit, pooling, communization, operating or other agreements which control the 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	appointment of a successor operator; provided, however, that Seller shall use reasonable commercial efforts to assist Buyer in becoming the successor operator, including as further
provided in Article 1.5 above. 

  

	 	6.5	Permitted Encumbrances. As used herein the term “Permitted Encumbrances” shall mean any one (1) or more of the following described below or created or
described in documents described below: 

  

	 	(A)	The terms and conditions of the Leases, including without limitation lessors’ royalties, overriding royalties totaling 3% proportionately reduced to the Assignor interest in
the Leases (1% each to B. J. Packard, Stan Mendenhall and Kent Singleton), net profits interests, carried interests, production payments, reversionary interests and similar burdens, if the net cumulative effect of the burdens does not operate to
reduce the interest of Seller with respect to all Oil and Gas produced from any Lease below the Net Revenue Interest for such Lease set forth in Exhibit 1.1(A)-1; 

  

	 	(B)	Sales contracts terminable without penalty upon no more than ninety (90) days notice to the purchaser; 

  

	 	(C)	Preferential Rights and required third party consents to assignment and similar agreements with respect to which waivers or consents are obtained from the appropriate parties, or
the appropriate time period for asserting any such right has expired without an exercise of the right; 

  

	 	(D)	All rights to consent by, required notices to, filings with, or other actions by governmental entities in connection with the sale or conveyance of oil and gas leases or interests
therein if they are routinely obtained subsequent to the sale or conveyance; 

  

	 	(E)	Easements, rights-of-way, servitudes, permits, surface leases and other rights in respect of surface operations that do not materially interfere with the oil and gas operations to
be conducted on any Well or Lease; 

  

	 	(F)	All operating agreements, unit agreements, unit operating agreements, pooling agreements and pooling designations and other agreements affecting the Assets; and

  

	 	(G)	All rights reserved to or vested in any governmental, statutory or public authority to control or regulate any of the Assets in any manner, and all applicable laws, rules and orders
of governmental authority. 

  

	7.	Environmental Assessment. 

  

	 	(A)	Physical Condition of the Assets. The Assets have been used for oil and gas drilling and production operations and possibly for the storage and disposal of waste materials or
hazardous substances related to standard oil field operations. Physical changes in or under the Assets or adjacent lands may have occurred as a 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	result of such uses. The Assets also may contain buried pipelines and other equipment, whether or not of a similar nature, the locations of which may not now be known by Seller or
be readily apparent by a physical inspection of the Assets. Buyer understands that Seller does not have the requisite information with which to determine the exact nature or condition of the Assets nor the effect any such use has had on the physical
condition of the Assets. Pursuant to the Safe Water Drinking and Toxic Enforcement Act of 1986, Buyer is hereby notified and assumes the risk that detectable amounts of chemicals known to cause cancer, birth defects and other reproductive harm may
be found in, on or around the Assets. As of the Effective Date, Buyer shall assume the risk that the Assets may contain waste or contaminants and that adverse physical conditions, including the presence of waste or contaminants, may not have been
revealed by Buyer’s investigation. As of the Effective Date, all responsibility and liability related to disposal, spills, waste or contamination on or below the Assets shall be transferred from Seller to Buyer. 

  

	 	  	In addition, Buyer acknowledges that some oil field production equipment located on the Assets may contain asbestos and/or naturally-occurring radioactive material (NORM). In this
regard, Buyer expressly understands that NORM may affix or attach itself to inside of wells, materials and equipment as scale or in other forms, and that wells, materials and equipment located on the Assets described herein may contain NORM and that
NORM-containing materials may be buried or have been otherwise disposed of on the Assets. Buyer also expressly understands that special procedures may be required for the removal and disposal of asbestos and NORM from the Assets where it may be
found, and that Buyer assumes all liability if and when such activities are performed after the Closing Date. This provision shall survive the Closing. 

  

	 	(B)	Inspection and Testing. Prior to Closing, Buyer will have the right, at its sole cost and risk, to conduct a Phase I environmental assessment of the Assets. Any data
obtained shall be immediately provided to Seller, including any reports and conclusions. Seller and Buyer shall keep all information strictly confidential whether or not Closing occurs, except as may be required pursuant to any Environmental Laws.

  

	 	(C)	Notice of Adverse Environmental Conditions. No later than three (3) business days after Closing, Buyer will notify Seller in writing of any Adverse Environmental
Condition with respect to the Assets. Such notice shall describe in reasonable detail the Adverse Environmental Condition and include the estimated Environmental Defect Value attributable thereto. The “Environmental Defect Value”
attributable to any Adverse Environmental Condition will be the estimated amount of all reasonable costs and claims associated with the existence, remediation or correction of the Adverse Environmental Conditions, as reasonably determined and
estimated by Buyer. The term “Adverse Environmental Condition” means (i) the failure of the Assets to be in material compliance with all applicable Environmental Laws; (ii) the Assets being subject to any agreements, consent
orders, decrees or judgments in existence at this time 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	based on any Environmental Laws that negatively and materially impact the future use of any portion of the Assets or that require any material change in the present conditions of
any of the Assets or; (iii) the Assets being subject to any material uncured notices of violations of or material non-compliance with any applicable Environmental Laws. 

  

	 	(D)	Rights and Remedies for Environmental Conditions. 

  

	 	(i)	Notwithstanding anything to the contrary herein, if the collective value of the uncured Adverse Environmental Conditions is less than One Million Dollars ($1,000,000), there will
not be any reduction of the Purchase Price or Adjusted Purchase Price. If the collective value of the uncured Environmental Conditions equals or exceeds One Million Dollars ($1,000,000), the Purchase Price will be adjusted downward, in the
Post-Closing Statement, to reflect the dollar amount of the uncured Adverse Environmental Conditions. ; and 

  

	 	(ii)	If Seller and Buyer are unable to agree on the cost of the Adverse Environmental Condition, then the dispute will be submitted to a mutually agreeable arbitrator (the
“Environmental Arbitrator”) whose determination shall be final and binding upon the Parties. Seller and Buyer shall each bear their respective costs and expenses incurred in connection with any such arbitration process, including and
one-half (1/2) of the fees, costs and expenses charged by the Environmental Arbitrator. 

  

	8.	REPRESENTATIONS AND WARRANTIES OF SELLER. 

  

	 	8.1	Seller’s Representations and Warranties. Subject to the disclosures set forth in the Exhibits referred to in this Article 8, Seller represents and warrants as of the
Effective Date and as of Closing as follows: 

  

	 	(A)	Status. Seller is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Texas. 

  

	 	(B)	Authority. Seller owns the Assets and has the requisite power and authority to enter into this Agreement, to carry out the transactions contemplated hereby, to transfer the
Assets in the manner contemplated by this Agreement, and to undertake all of the obligations of Seller set forth in this Agreement. 

  

	 	(C)	Validity of Obligations. This Agreement and any documents or instruments delivered by Seller at the Closing shall constitute legal, valid and binding obligations of Seller,
enforceable in accordance with their terms. 

  

	 	(D)	Contractual Restrictions. Seller has not entered into any contracts for or received prepayments, take-or-pay arrangements, buydowns, buyouts for 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	Oil and Gas, or storage of the same relating to the Assets which Buyer shall be obligated to honor and make deliveries of Oil and Gas or pay refunds of amounts previously paid under
such contracts or arrangements except those listed on Exhibit 7. 

  

	 	(E)	Litigation. To Seller’s knowledge, after reasonable inquiry, except as set forth in Exhibit 2, there is no suit, action, claim, judgment or proceeding pending, arising
out of, or with respect to the ownership, operation or environmental condition of the Assets that would have a material adverse affect upon the Assets. Buyer shall assume no liability or obligation with respect to the litigation set forth on Exhibit
2. All litigation set forth on Exhibit 2 shall be deemed to have accrued prior to the Effective Date unless specifically identified as accruing on or after the Effective Date. 

  

	 	(F)	Permits and Consents. To Seller’s knowledge, after reasonable inquiry, with respect to Assets for which Seller is the operator, Seller (i) has acquired all material
permits, licenses, approvals and consents from appropriate governmental bodies, authorities and agencies to conduct operations on the Assets in compliance with applicable laws, rules, regulations, ordinances and orders; and (ii) is in material
compliance with all such permits, licenses, approvals and consents and with applicable Environmental Laws. “Environmental Laws” means all applicable local, state, and federal laws, rules, regulations, and orders regulating or otherwise
pertaining to: (i) the use, generation, migration, storage, removal, treatment, remedy, discharge, release, transportation, disposal, or cleanup of pollutants, contamination, hazardous wastes, hazardous substances, hazardous materials, toxic
substances or toxic pollutants; (ii) surface waters, ground waters, ambient air and any other environmental medium on or off any Lease; or (iii) the environment or health and safety-related matters; including the following as from time to
time amended and all others whether similar or dissimilar: the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, the Resource Conservation and
Recovery Act of 1976, as amended by the Used Oil Recycling Act of 1980, the Solid Waste Disposal Act Amendments of 1980, and the Hazardous and Solid Waste Amendments of 1984, the Hazardous Materials Transportation Act, as amended, the Toxic
Substance Control Act, as amended, the Clean Air Act, as amended, the Clean Water Act, as amended, and all regulations promulgated pursuant thereto. 

  

	 	(G)	Broker’s Fees. Seller has incurred no obligation or liability, contingent or otherwise, for brokers’ or finders’ fees in respect of the matters provided for in
this Agreement, and, if any such obligation or liability exists, it shall remain an obligation of Seller, and Buyer shall have no responsibility therefor. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	(H)	Taxes. Seller has filed (with respect to the Assets) all material Tax returns that are due, if any, all Taxes (with respect to the Assets) shown to be due on such returns
have been paid, and there is no material dispute or claim concerning any Tax liability of the Seller (with respect to the Assets) claimed or raised by any Tax authority in writing. For purposes of this Agreement, the term “Tax” or
“Taxes” means any federal, state, local or tribal, income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including taxes under Section 59A of the Code),
custom duties, capital stock, franchise, profits, withholding, social security (or similar excises), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, including any interest, penalty or addition thereto, whether disputed or not. 

  

	 	(I)	No Violations. Seller’s execution and delivery of this Agreement and Seller’s consummation of the transactions contemplated by this Agreement will not:

  

	 	i)	conflict with or require consent of any person or entity under any terms, conditions or provisions of Seller’s certificate of formation or other governing corporate documents;

  

	 	ii)	violate any provision of, or require any filing, consent or approval under any law applicable to Seller (except for consents and approvals of governmental entities or authorities
customarily obtained subsequent to transfer of title); or 

  

	 	iii)	result in the creation or imposition of any lien or encumbrance on the Assets. 

  

	 	(J)	Bankruptcy. There are no bankruptcy or receivership proceedings pending against Seller, being contemplated by Seller or threatened against Seller; 

 

	 	(K)	Leases and Wells. To the best of Seller’s knowledge, after reasonable inquiry, Seller is not in default under any of the material terms and provisions of the Leases or
under any agreement to which the Leases are subject; all royalties, rentals, and other payments due under the Leases have been timely and properly paid in full on or before the due dates thereof; and each Well was drilled within the boundaries of
its respective Lease, and in compliance with all applicable laws, rules, regulations, and permits. 

  

	 	8.2	Scope of Representations of Seller. Except as expressly set forth in this Agreement, Seller disclaims all liability and responsibility for any representation, warranty,
statements or communications (orally or in writing) to Buyer, including 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	  	any information contained in any opinion, information or advice that may have been provided to Buyer by any employee, officer, director, agent, consultant, engineer or engineering
firm, trustee, representative, investment banker, financial advisor, partner, member, beneficiary, stockholder or contractor of Seller wherever and however made, including those made in any data room or internet site and any supplements or
amendments thereto or during any negotiations with respect to this Agreement or any confidentiality agreement previously executed by the Parties with respect to the Asset. EXCEPT AS SET FORTH IN THIS ARTICLE 8 OF THIS AGREEMENT, SELLER MAKES NO
WARRANTY OR REPRESENTATION, EXPRESS, STATUTORY OR IMPLIED, AS TO (i) THE ACCURACY, COMPLETENESS OR MATERIALITY OF ANY DATA, INFORMATION OR RECORDS FURNISHED TO BUYER IN CONNECTION WITH THE ASSETS OR OTHERWISE CONSTITUTING A PORTION OF THE
ASSETS; (ii) THE PRESENCE, QUALITY AND QUANTITY OF HYDROCARBON RESERVES (IF ANY) ATTRIBUTABLE TO THE ASSETS, INCLUDING WITHOUT LIMITATION SEISMIC DATA AND SELLER’S INTERPRETATION AND OTHER ANALYSIS THEREOF; (iii) THE ABILITY OF THE
ASSETS TO PRODUCE HYDROCARBONS, INCLUDING WITHOUT LIMITATION PRODUCTION RATES, DECLINE RATES AND RECOMPLETION OPPORTUNITIES; (iv) THE PRESENT OR FUTURE VALUE OF THE ANTICIPATED INCOME, COSTS OR PROFITS, IF ANY, TO BE DERIVED FROM THE ASSETS;
(v) THE ENVIRONMENTAL CONDITION OF THE ASSETS; (vi) ANY PROJECTIONS AS TO EVENTS THAT COULD OR COULD NOT OCCUR; (vii) THE TAX ATTRIBUTES OF ANY ASSET; (viii) ANY OTHER MATTERS CONTAINED IN OR OMITTED FROM ANY INFORMATION OR
MATERIAL FURNISHED TO BUYER BY SELLER OR OTHERWISE CONSTITUTING A PORTION OF THE ASSETS; AND (ix) THE COMPLETENESS OR ACCURACY OF THE INFORMATION CONTAINED IN ANY EXHIBIT HERETO. ANY DATA, INFORMATION OR OTHER RECORDS FURNISHED BY SELLER ARE
PROVIDED TO BUYER AS A CONVENIENCE AND BUYER’S RELIANCE ON OR USE OF THE SAME IS AT BUYER’S SOLE RISK. 

  

	9.	REPRESENTATIONS AND WARRANTIES OF BUYER. 

  

	 	9.1	Buyer’s Representations and Warranties. Buyer represents and warrants (which representations and warranties shall survive the Closing) as follows:

  

	 	(A)	Status of Incorporation. Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Texas. 

  

	 	(B)	Authority. Buyer has the corporate power and authority to enter into this Agreement, to carry out the transactions contemplated hereby and to undertake all of the obligations
of Buyer set out in this Agreement. 

  

	 	(C)	Validity of Obligations. The execution, delivery and performance of this Agreement and the performance of the transactions contemplated by this 

 Purchase and Sale Agreement Between Millennium and ATP 
  

 Agreement will not in any respect violate, nor be in conflict with, any provision of Buyer’s
charter, by-laws or other governing documents, or any agreement or instrument to which Buyer is a party or is bound, or any judgment, decree, order, statute, rule or regulation applicable to Buyer (subject to governmental consents and approvals
customarily obtained after the Closing). This Agreement constitutes legal, valid and binding obligations of Buyer, enforceable in accordance with its terms. 
  

	 	(D)	Qualification and Bonding. Subject to the provisions in Article 1.5, Buyer is in compliance with the bonding and liability insurance requirements in accordance with all
applicable state or federal laws or regulations and that it is and henceforth will continue to be qualified to own any federal, state oil and gas leases that constitute part of the Assets. 

  

	 	(E)	Evaluation. Buyer represents that by reason of Buyer’s knowledge and experience in the evaluation, acquisition and operation of oil and gas properties, Buyer has
evaluated the merits and risks of purchasing the Assets from Seller and has formed an opinion based solely upon Buyer’s knowledge and experience and not upon any representations or warranties by Seller. 

  

	 	(F)	Broker’s Fees. Buyer has incurred no obligation or liability, contingent or otherwise, for brokers’ or finders’ fees in respect of the matters provided for in
this Agreement, and, if any such obligation or liability exists, it shall remain an obligation of Buyer, and Seller shall have no responsibility therefor. 

  

	10.	RECORDS AND CONTRACTS. Seller shall have the right to make and retain copies of the Records and Contracts as Seller may desire prior to the delivery of the Records and
Contracts to Buyer. Buyer, for a period of three (3) years after the Closing Date, shall make available to Seller (at the location of such Records and Contracts in Buyer’s organization) access to such Records and Contracts as Buyer may
have in its possession (or to which it may have access) upon written request of Seller, during normal business hours. Seller shall provide Buyer the Records and Contracts within seven (7) days of the Closing Date. 

  

	11.	CERTAIN AGREEMENTS OF BUYER. Buyer agrees and covenants that the following provisions shall apply: 

  

	 	11.1	Plugging Obligation. To the extent of the Working Interest acquired by Buyer under this Agreement, Buyer shall perform and assume its proportionate share of the liability for
the necessary and proper plugging and abandonment of all Wells. 

  

	 	11.2	PLUGGING BOND. DURING THE TRANSITION PERIOD (AS MORE SPECIFICALLY DESCRIBED IN ARTICLE 1.5) SELLER, ON BUYER’S BEHALF, WILL, UNLESS PROHIBITED FROM DOING SO BY RULES OR
REGULATIONS OF APPLICABLE GOVERNMENTAL AGENCIES, 

 Purchase and Sale Agreement Between Millennium and ATP 
  

 MAINTAIN THE NECESSARY BONDS OR LETTERS OF CREDIT AS REQUIRED BY THE MMS FOR THE PLUGGING OF ALL
WELLS ON THE TRANSITION LEASES, AND PROVIDE BUYER WITH A COPY OF SAME, AND PROVIDE PROOF SATISFACTORY TO BUYER THAT THE MMS HAS ACCEPTED SUCH BONDS OR LETTERS OF CREDIT AS SUFFICIENT ASSURANCE TO COVER THE PLUGGING OF ALL WELLS AND RELATED MATTERS
FOR THE TRANSITION LEASES. 
  

	 	11.3	CHANGE OF OPERATOR. PRIOR TO FEBRUARY 1, 2006, BUYER SHALL PROVIDE TO SELLER COPIES OF THE APPROVAL BY ANY APPLICABLE REGULATORY AGENCIES CONCERNING CHANGE OF OPERATORSHIP OF
THE NON-TRANSITION LEASES. 

  

	12.	ADDITIONAL COVENANTS. 

  

	 	12.1	Preferential Rights to Purchase. Seller shall use the allocations specified on Exhibit 3 to provide any required notices to holders of preferential rights to purchase
(“PRP Party”). If, prior to or as of the time of Closing, a PRP Party notifies Seller that it elects to exercise its rights with respect to the Assets to which its preferential purchase right applies, the Purchase Price shall be reduced by
the allocated amount to that Asset or Assets and Buyer and Seller will close on the remaining Assets and interests in Assets as provided for in this Agreement. If, prior to or as of the time of Closing, any of said preferential rights of purchase
have not been declined, waived or expired, Buyer and Seller shall close on those Assets as if the preferential rights had been waived. If after Closing of the purchase and sale of the Assets between Seller and Buyer, a PRP Party elects to exercise
any preferential right to purchase any portion of the Assets, then there shall promptly be an additional closing between Buyer and the PRP Party for such portion of the Assets at which Buyer will promptly transfer the affected portion of the Assets
to the PRP Party and Buyer will promptly settle with the PRP Party that portion of the Purchase Price attributable thereto as adjusted in accordance with any allowable adjustments under this Agreement. Any sale to a PRP Party of a portion of the
Assets will be sold to such PRP Party pursuant to, and on the same, terms and conditions of this Agreement. Buyer shall provide a copy of the assignment to Seller upon completion of the assignment and a subsequent copy of the MMS approved
assignment. 

  

	13.	CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER. All obligations of Buyer under this Agreement are, at Buyer’s election, subject to the fulfillment, prior to or at the
Closing, of each of the following conditions: 

  

	 	13.1	No Litigation. At the Closing, no suit, action or other proceeding shall be pending before any court or governmental agency which attempts to prevent the occurrence of the
transactions contemplated by this Agreement. 

  

	 	13.2	Representations and Warranties. All representations and warranties of Seller contained in this Agreement shall be true in all material aspects as of the Closing

 Purchase and Sale Agreement Between Millennium and ATP 
  

 as if such representations and warranties were made as of the Closing Date (except for those
representations or warranties that are expressly made only as of another specific date, which representations and warranties shall be true in all material respects as of such other date) and Seller shall have performed and satisfied in all material
respects all covenants and fulfilled all conditions required by this Agreement to be performed and satisfied by Seller at or prior to the Closing. 
  

	14.	CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER. All obligations of Seller under this Agreement are, at Seller’s election, subject to the fulfillment, prior to or at
the Closing, of each of the following conditions: 

  

	 	14.1	No Litigation. At the Closing, no suit, action or other proceeding shall be pending before any court or governmental agency which attempts to prevent the occurrence of the
transactions contemplated by this Agreement. 

  

	 	14.2	Representations and Warranties. All representations and warranties of Buyer contained in this Agreement shall be true in all material aspects as of the Closing, as if such
representations and warranties were made as of the Closing Date (except for those representations or warranties that are expressly made only as of another specific date, which representations and warranties shall be true in all material respects as
of such other date) and Buyer shall have performed and satisfied in all material respects all covenants and fulfilled all conditions required by this Agreement to be performed and satisfied by Buyer at or prior to the Closing.

  

	15.	TERMINATION. 

  

	 	15.1	Causes of Termination. This Agreement and the transactions contemplated herein may be terminated: 

  

	 	(A)	At any time by mutual consent of the Parties. 

  

	 	(B)	By either Party if a material adverse change to the Assets occurs prior to Closing. A material adverse change shall mean a change that reduces the value of the Assets by more than
One Million Dollars ($1,000,000). 

  

	 	(C)	By Buyer if, on the Closing Date, any of the conditions set forth in Article 13 hereof shall not have been satisfied or waived. 

  

	 	(D)	By Seller if, on the Closing Date, any of the conditions set forth in Article 14 hereof shall not have been satisfied or waived. 

  

	 	15.2	Effect of Termination. In the event of the termination of this Agreement pursuant to the provisions of this Article 15 or elsewhere in this Agreement, this Agreement shall
become void and have no further force and effect and, except for the indemnities provided for in Section 16.3, any breach of this Agreement prior to such termination and any continuing confidentiality requirement, neither Party

 Purchase and Sale Agreement Between Millennium and ATP 
  

 shall have any further right, duty or liability to the other hereunder. Upon termination, Buyer
agrees to use its best efforts to return to Seller or destroy, all materials, documents and copies thereof provided, obtained or discovered in the course of any due diligence investigations. 
  

	16.	INDEMNIFICATION. 

  

	 	16.1	INDEMNIFICATION BY SELLER. UPON CLOSING, SELLER SHALL, TO THE FULLEST EXTENT PERMITTED BY LAW, RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS BUYER, ITS PARENT AND SUBSIDIARY
COMPANIES, AND EACH OF THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS AND OTHER REPRESENTATIVES (THE “BUYER GROUP”) FROM AND AGAINST THE FOLLOWING: 

  

	 	(A)	MISREPRESENTATIONS. ALL CLAIMS, DEMANDS, LIABILITIES, JUDGMENTS, LOSSES AND REASONABLE COSTS, EXPENSES AND ATTORNEYS’ FEES AND COURT COSTS (INDIVIDUALLY A
“LOSS” AND COLLECTIVELY, THE “LOSSES”) ARISING FROM THE BREACH BY SELLER OF ANY REPRESENTATION OR WARRANTY SET FORTH IN THIS AGREEMENT; 

  

	 	(B)	BREACH OF COVENANTS. ALL LOSSES ARISING FROM THE BREACH BY SELLER OF ANY COVENANT SET FORTH IN THIS AGREEMENT; AND 

  

	 	(C)	OWNERSHIP AND OPERATION. ALL LOSSES ARISING FROM THE OWNERSHIP AND OPERATION OF THE ASSETS, UNLESS SPECIFICALLY ASSUMED ELSEWHERE HEREIN BY BUYER, PRIOR TO THE EFFECTIVE
DATE, INCLUDING: 

  

	 	(i)	DAMAGES TO PERSONS OR PROPERTY; 

  

	 	(ii)	THE VIOLATION BY SELLER OF ANY LAW OR REGULATION OR THE TERMS OF ANY AGREEMENT BINDING UPON SELLER; 

  

	 	(iii)	CLAIMS OF SELLER’S CO-OWNERS, PARTNERS, JOINT VENTURERS AND OTHER PARTICIPANTS IN THE WELLS; 

  

	 	(iv)	TAXES ATTRIBUTABLE TO THE ASSETS; AND 

  

	 	(v)	THE INCORRECT PAYMENT OF ROYALTIES UNDER THE LEASES. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	(D)	Notwithstanding the above, the following limitations shall apply to Seller’s indemnification obligations: 

  

	 	(i)	Seller shall not be obligated to indemnify Buyer for any Loss unless Buyer has delivered a written notice of such Loss within the Survival Period (as defined below) applicable to
such Loss. Any Loss for which Seller does not receive written notice before the end of the Survival Period shall be deemed to be an Assumed Liability. The “Survival Period” applicable to Losses shall mean: 

  

	 	(a)	with regard to a breach of covenants and the representations and warranties set forth in Article 8 for a period of two (2) years after Closing and 

  

	 	(b)	one (1) year after Closing for all other matters. 

  

	 	(ii)	The indemnification obligations of Seller pursuant to this Agreement shall be limited to actual Losses and shall not include incidental, consequential, indirect, punitive, or
exemplary Losses or damages, except to the extent that a third party may be awarded the damages; 

  

	 	(iii)	The amount of Losses required to be paid by Seller to indemnify Buyer pursuant to this Agreement shall be reduced to the extent of any amounts actually received by Buyer pursuant to
the terms of the insurance policies (if any) covering such claim and any tax benefits received by Buyer; 

  

	 	(iv)	Seller’s indemnification obligations shall not extend to Environmental liabilities of any kind. 

  

	 	(v)	Seller’s indemnification obligations shall not cover any liabilities, duties and obligations relating to properly plugging and abandoning wells, removal of all pipelines,
equipment, and platforms and related facilities now or hereafter located on the Assets, and cleaning up, restoring and remediation of the Assets in accordance with the applicable Environmental Laws and the Leases, including but not limited to
liabilities, duties and obligations (including but not limited to the payment of fines, penalties, monetary sanctions or other amounts payable for failure to comply with the requirements of applicable Environmental Laws) related to any violation of
any Environmental Laws or the presence, disposal, release or threatened release of any hazardous substance or hazardous waste from the Assets into the atmosphere or into the water whether or not attributable to Seller’s activities or the
activities of third parties; and 

  

	 	(vi)	Buyer acknowledges and agrees that the indemnification provisions in this Article 16 and the termination rights in Article 15 shall be the exclusive remedies of Buyer with respect
to the transactions contemplated by this Agreement. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	16.2	INDEMNIFICATION BY BUYER. UPON CLOSING, BUYER SHALL TO THE FULLEST EXTENT PERMITTED BY LAW, RELEASE, DEFEND, INDEMNIFY, AND HOLD HARMLESS SELLER, ITS PARENT AND SUBSIDIARY
COMPANIES, AND EACH OF THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS AND OTHER REPRESENTATIVES (THE “SELLER GROUP”) FROM AND AGAINST THE FOLLOWING: 

  

	 	(A)	MISREPRESENTATIONS. ALL LOSSES ARISING FROM THE BREACH BY BUYER OF ANY REPRESENTATION OR WARRANTY SET FORTH IN THIS AGREEMENT THAT SURVIVES CLOSING; 

 

	 	(B)	BREACH OF COVENANTS. ALL LOSSES ARISING FROM THE BREACH BY BUYER OF ANY COVENANT SET FORTH IN THIS AGREEMENT; 

  

	 	(C)	OWNERSHIP AND OPERATION. ALL LOSSES ARISING FROM THE ASSUMED LIABILITIES, AND ALL LOSSES ARISING ON OR AFTER THE EFFECTIVE DATE FROM THE OWNERSHIP AND OPERATION OF THE
ASSETS. 

  

	 	(D)	ENVIRONMENTAL LIABILITIES. ALL ENVIRONMENTAL LIABILITIES, ARISING OR ACCRUING FROM THE OWNERSHIP AND OPERATION OF THE ASSETS. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY,
BUYER SHALL BE LIABLE FOR ALL PLUGGING AND ABANDONING LIABILITIES AND PLATFORM REMOVALS REGARDLESS OF WHETHER THEY AROSE OR ACCRUED BEFORE OR AFTER THE EFFECTIVE DATE. “ENVIRONMENTAL LIABILITIES” MEANS ANY AND ALL OBLIGATIONS AND
LIABILITIES ARISING DIRECTLY OR INDIRECTLY FROM ANY IMPAIRMENT OR DAMAGE TO THE ENVIRONMENT CAUSED BY OR PERTAINING TO THE ASSETS OR THE OPERATION THEREOF INCLUDING ANY ABANDONMENT AND RECLAMATION OBLIGATIONS, ANY RELEASE, AND ANY OTHER MATTERS
RELATING TO SURFACE, SUBSURFACE, AIR OR WATER CONTAMINATION OR THE BREACH OF ANY ENVIRONMENTAL LAWS. 

  

	 	16.3	PHYSICAL INSPECTION. BUYER INDEMNIFIES AND AGREES TO RELEASE, DEFEND, INDEMNIFY AND HOLD HARMLESS THE SELLER GROUP FROM AND AGAINST ANY AND ALL LOSSES ARISING FROM
BUYER’S INSPECTING AND OBSERVING THE ASSETS, INCLUDING (A) LOSSES FOR PERSONAL INJURIES TO OR DEATH OF EMPLOYEES OF THE BUYER, ITS CONTRACTORS, AGENTS, CONSULTANTS AND 

 Purchase and Sale Agreement Between Millennium and ATP 
  

 REPRESENTATIVES, AND DAMAGE TO THE PROPERTY OF BUYER OR OTHERS ACTING ON BEHALF OF BUYER; AND
(B) LOSSES FOR PERSONAL INJURIES TO OR DEATH OF EMPLOYEES OF THE SELLER GROUP OR THIRD PARTIES, AND DAMAGE TO THE PROPERTY OF THE SELLER GROUP OR THIRD PARTIES. THE FOREGOING INDEMNITY INCLUDES, AND THE PARTIES INTEND IT TO INCLUDE, AN
INDEMNIFICATION OF THE SELLER GROUP FROM AND AGAINST LOSSES ARISING OUT OF OR RESULTING, IN WHOLE OR PART, FROM THE CONDITION OF THE ASSETS OR THE SELLER GROUP’S SOLE, JOINT, COMPARATIVE, OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR FAULT.

  

	 	16.4	Notification. As soon as reasonably practical after obtaining knowledge thereof, the indemnified Party shall notify the indemnifying Party of any claim or demand which the
indemnified Party has determined has given or could give rise to a claim for indemnification under this Article 16. Such notice shall specify the agreement, representation or warranty with respect to which the claim is made, the facts giving rise to
the claim and the alleged basis for the claim, and the amount (to the extent then determinable) of liability for which indemnity is asserted. In the event any action, suit or proceeding is brought with respect to which a Party may be liable under
this Article 16, the defense of the action, suit or proceeding (including all settlement negotiations and arbitration, trial, appeal, or other proceeding) shall be at the discretion of and conducted by the indemnifying Party. If an indemnified Party
shall settle any such action, suit or proceeding without the written consent of the indemnifying Party (which consent shall not be unreasonably withheld), the right of the indemnified Party to make any claim against the indemnifying Party on account
of such settlement shall be deemed conclusively denied. An indemnified Party shall have the right to be represented by its own counsel at its own expense in any such action, suit or proceeding, and if an indemnified Party is named as the defendant
in any action, suit or proceeding, it shall be entitled to have its own counsel and defend such action, suit or proceeding with respect to itself at its own expense. Subject to the foregoing provisions of this Article 16, neither Party shall,
without the other Party’s written consent, settle, compromise, confess judgment or permit judgment by default in any action, suit or proceeding if such action would create or attach any liability or obligation to the other Party. The Parties
agree to make available to each other, and to their respective counsel and accountants, all information and documents reasonably available to them which relate to any action, suit or proceeding, and the Parties agree to render to each other such
assistance as they may reasonably require of each other in order to ensure the proper and adequate defense of any such action, suit or proceeding. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	17.	MISCELLANEOUS. 

  

	 	17.1	Confidentiality. 

  

	 	(A)	Prior to Closing, to the extent not already public, Buyer shall exercise all due diligence in safeguarding and maintaining secure all engineering, geological and geophysical data,
seismic data, reports and maps, the results and findings of Buyer with regard to its due diligence associated with the Assets (including without limitation with regard to due diligence associated with environmental and title matters) and other data
relating to the Assets (collectively, the “Confidential Information”). Buyer acknowledges that, prior to Closing, all Confidential Information shall be treated as confidential and shall not be disclosed to third parties without the prior
written consent of Seller. Notwithstanding the foregoing, the Buyer shall be entitled to disclose the Confidential Information without Seller’s prior express written consent to the following persons and entities: 

  

	 	(a)	employees, officers and directors of the Buyer; 

  

	 	(b)	employees, officers and directors of an affiliated company; 

  

	 	(c)	any consultant or agent retained by the Buyer or its affiliated company; or 

  

	 	(d)	any bank or other financial institution or entity funding or proposing to fund the transactions contemplated by this Agreement, including any consultant retained by such bank or
other financial institution or entity. 

  

	 	(B)	In the event of termination of this Agreement for any reason, the Confidential Information will be deemed provided to Buyer under the terms of that certain Confidentiality
Agreement, between Buyer and Seller, dated August 24, 2005 (“Confidentiality Agreement”). 

  

	 	(C)	The confidentiality obligations in this Agreement shall not diminish or take precedence over those in the Confidentiality Agreement, and if this Agreement terminates, the
Confidentiality Agreement shall remain in full force and effect. 

  

	 	17.2	Competition. Buyer acknowledges that Seller may presently own interests or have leads, prospects, information or ideas on properties or leaseholds adjacent to, adjoining or
in the vicinity of the Assets. Seller shall not be prohibited in any way from competing with Buyer or pursuing any activity or business opportunity on property not being transferred to Buyer pursuant to this Agreement. 

  

	 	17.3	Notice. Any notice, request, demand, or consent required or permitted to be given hereunder shall be in writing and delivered in person or by certified letter, with

 Purchase and Sale Agreement Between Millennium and ATP 
  

 return receipt requested or by prepaid overnight delivery service, or by facsimile addressed to the
Party for whom intended at the following addresses: 
  

					
	SELLER:	    	 	  	 
	 	    	 Millennium Offshore Group, Inc.
 5300
Memorial Drive, Suite 5300
 Houston, Texas 77007
 Attn: Stan
Mendenhall
 Tel: (713) 652-0137
 Fax:
(713) 652-0482

			
	BUYER:	    	 	  	 
	 	    	Address:	  	 ATP Oil & Gas Corporation
 4600 Post Oak Place, Suite
200
 Houston, Texas 770027

			
	 	    	Representative            	  	 Mr. James S. Tomlin
 Manager of Land and Associate
General Counsel
 Telephone: (713) 386-2408
 Fax: (713)
622-5101
 E-mail: jtomlin@atpog.com

			
	 	    	 Alternative
 Representative
	  	 Mr. Gerald W. Schlief
 Senior Vice President

Telephone: (713) 622-3311
 Fax: (713) 622-5101
 E-mail: jschlief@atpog.com

  
 or at such other
address as any of the above shall specify by like notice to the other. 
  

	 	17.4	Press Releases and Public Announcements. No Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement prior to the
Closing without the prior written approval of the other Party; provided, however, that any Party may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its or its
affiliates’ publicly-traded securities. 

  

	 	17.5	Governing Law. THIS AGREEMENT IS GOVERNED BY AND MUST BE CONSTRUED ACCORDING TO THE LAWS OF THE STATE OF TEXAS, EXCLUDING ANY CONFLICTS-OF-LAW RULE OR PRINCIPLE THAT MIGHT
APPLY THE LAW OF ANOTHER JURISDICTION. ALL DISPUTES RELATED TO THIS AGREEMENT SHALL BE SUBMITTED TO THE JURISDICTION OF THE COURTS OF THE STATE OF TEXAS AND VENUE SHALL BE IN THE CIVIL DISTRICT COURTS OF HARRIS COUNTY, TEXAS.

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	17.6	Exhibits. The Exhibits attached to this Agreement are incorporated into and made a part of this Agreement. 

  

	 	17.7	Fees, Expenses, Taxes and Recording. 

  

	 	(A)	Each Party shall be solely responsible for all costs and expenses incurred by it in connection with this transaction (including, but not limited to fees and expenses of its counsel
and accountants) and shall not be entitled to any reimbursements from the other Party, except as otherwise provided in this Agreement. 

  

	 	(B)	Buyer shall, at its own cost, record all instruments of conveyance and sale in the MMS and the appropriate county or parish offices. Buyer shall supply Seller with a true and
accurate photocopy reflecting the recording information of all the recorded and filed assignments within a reasonable period of time after their recording and filing. 

  

	 	17.8	Assignment. Prior to Closing, this Agreement or any part hereof may not be assigned by either Party without the prior written consent of the other Party. This Agreement is
binding upon the Parties hereto and their respective successors and assigns. 

  

	 	17.9	Continued Operations. In order to facilitate Buyer’s acquisition of the Assets the Parties hereby agree to enter into a mutually acceptable contractual agreement
(Agreement for Contract Operations) as soon a practicable after the Closing Date. The Agreement for Contract Operations shall be effective as of October 31, 2005. Seller shall continue operating the Assets, covered by the Agreement for Contract
Operations, until the Seller’s services are terminated in accordance with the terms of the Agreement for Contract Operations. 

  

	 	17.10	South Timbalier Block 77 and High Island Block 74 (“Retained Acreage”). It is understood and agreed by Seller and Buyer that Seller is retaining Operating Rights as
to portions of South Timbalier Block 77 bearing MMS Serial Number OCS-G 4827, (“ST 77”), and as to portions of High Island Block 74 bearing MMS Serial Number OCS-G 21348, (“HI 74”); however, since Seller currently owns one
hundred percent record title in ST 77 and HI 74, at Closing, Seller will convey to Buyer all of Seller’s record title and operating rights interests in ST 77 and HI 74 and Buyer shall simultaneously, upon the execution of this Agreement,
execute and deliver to Seller the Assignment of Operating Rights attached hereto as Exhibit 4.6, Exhibit 4.7, and Exhibit 4.8. 

  

	 	17.11	Entire Agreement. This Agreement constitutes the entire agreement reached by the Parties with respect to the subject matter hereof, superseding all prior negotiations,
discussions, agreements and understandings, whether oral or written, relating to such subject matter. 

 Purchase and Sale Agreement Between Millennium and ATP 
  

	 	17.12	Severability . In the event that any one or more covenants, clauses or provisions of this Agreement shall be held invalid or illegal, such invalidity or unenforceability
shall not affect any other provisions of this Agreement. 

  

	 	17.13	Captions. The captions in this Agreement are for convenience only and shall not be considered a part of or affect the construction or interpretation of any provision of this
Agreement. 

  

	 	17.14	Counterpart Execution. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original, and all of which
together shall constitute one and the same instrument. 

  

	 	17.15	Waiver of Certain Damages. Each of the Parties hereby waives and agrees not to seek consequential or punitive damages with respect to any claim, controversy, or dispute
arising out of or relating to this Agreement or the breach thereof. 

  

	 	17.16	Amendments and Waivers. This Agreement may not be modified or amended except by an instrument in writing signed by both parties. Any Party hereto may, only by an instrument
in writing, waive compliance by another Party with any term or provision of this Agreement on the part of such other Party hereto to be performed or complied with. The waiver by any Party hereto of a breach of any term or provision of this Agreement
shall not be construed as a waiver of any subsequent breach. 

  

	18.	Exhibits: The exhibits, as indicated below and attached hereto, are incorporated in and made a part of this Agreement. 

  

			
	1.1(A)-1	 	Leases and Permitted Encumbrances
		
	1.1(A)-1.a	 	Assignment of Overriding Royalty to Casey Jones
		
	1.1(A)-1.b	 	Assignment of Overriding Royalty to Bernard J. Packard, et al.
		
	1.1(A)-1.c	 	Assignment of Overriding Royalty St. of Louisiana lease to Bernard J. Packard, et al.
		
	1.1(A)-2	 	Related Assets
		
	1.2	 	Excluded Assets
		
	1.5	 	Transition Leases listing
		
	2	 	Litigation
		
	3	 	Allocated Values
		
	4.1	 	Record Title Assignment and Bill of Sale
		
	4.2	 	Assignment of Operating Rights and Bill of Sale
		
	4.3	 	Assignment and Bill of Sale
		
	4.4	 	Assignment of Right-of-Way
		
	4.5	 	Assignment of State Lease
		
	4.6	 	Assignment of Operating Rights from Buyer to Seller covering portions of South Timbalier Block 77
		
	4.7	 	Assignment of Operating Rights from Buyer to Seller covering portions of High Island Block 74

 Purchase and Sale Agreement Between Millennium and ATP 
  

			
	4.8	  	Assignment of Operating Rights from Buyer to Seller covering portions of High Island Block 74
		
	5	  	Production Imbalances – (Intentionally Deleted)
		
	6	  	Blocks with Preferential Rights
		
	7	  	Imbalance Agreement

  
 -Signature Page
Follows- 

 Purchase and Sale Agreement Between Millennium and ATP 
  

 Executed as of the day and year first above written. 
  

			
	SELLER:
	
	MILLENNIUM OFFSHORE GROUP, INC.
		
	By:	 	  

	 	 	Stan Mendenhall, Executive Vice President
	
	BUYER:
	
	ATP OIL & GAS CORPORATION
		
	By:	 	  

	 	 	Gerald W. Schlief, Senior Vice PresidentAmended and Restated Change in Control Agreement

 Exhibit 10.06 
  
 EL PASO ELECTRIC COMPANY 
 AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT 
 FOR EXECUTIVE OFFICERS 
  
 AGREEMENT by and between El Paso Electric Company, a Texas corporation (the
“Company”), and                      (the “Executive”), dated as of the      day of
                    , 200  . 
  
 W I T N E S S E T H 
  
 WHEREAS, the Executive currently serves as a key employee of the Company and his or her services and knowledge are valuable to the Company in connection
with the management of the Company; and 
  
 WHEREAS, the Board of
Directors of the Company (the “Board”) has determined that it is in the best interests of the Company and its stockholders to secure the Executive’s continued services and to ensure the Executive’s continued dedication and
objectivity in the event of any threat or occurrence of, or negotiation or other action that could lead to, or create the possibility of, a Change in Control (as defined in Attachment 1) of the Company, without concern as to whether the Executive
might be hindered or distracted by personal uncertainties and risks created by any such possible Change in Control, and to encourage the Executive’s full attention and dedication to the Company, the Board has authorized the Company to enter
into this Agreement. 
  
 NOW, THEREFORE, for and in consideration
of the premises and the mutual covenants and agreements herein contained, the Company and the Executive hereby agree as follows: 
  
 1. Employment Period. (a) The Company hereby agrees to employ the Executive and the Executive hereby agrees to accept employment with and remain in
the employment of the Company, subject to the terms and conditions of this Agreement, for the period commencing upon the occurrence of a Change in Control and ending on the second anniversary thereof, or such later date as may be mutually agreed
upon by the Company and the Executive. Notwithstanding the foregoing, the Executive’s employment hereunder may be earlier terminated, subject to Section 4 of this Agreement. The period of time between the commencement of a Change in
Control and the termination of the Executive’s employment hereunder shall be referred to herein as the “Employment Period”. 
  
 (b) Prior to the occurrence of a Change in Control, the Executive’s employment by the Company shall be deemed at will (or shall be governed by any
current contract of employment), and this Agreement shall not confer upon the Executive any right to continued employment by the Company in his or her current position or otherwise nor affect in any manner the right of the Company to change the
Executive’s duties and 

 responsibilities in any manner, or to reduce Executive’s compensation or terminate the employment of the Executive
at any time prior to the occurrence of a Change in Control and/or to cancel this Agreement at any time prior to the occurrence of a Change in Control. In particular, the Executive shall not have any rights under this Agreement for any such change,
reduction or termination of employment or of this Agreement “in anticipation of” any “change of control” that shall occur prior to the occurrence of a Change in Control. 
  
 2. Terms of Employment. (a) Position and Duties. (i) During the
Employment Period, (A) the Executive shall serve as                      of the Company or his or her then current position at the time
of a Change in Control (or the equivalent position in the division, subsidiary or other portion of any post-merger or post-acquisition successor that is operationally responsible for the electric business conducted by the Company prior to the merger
or acquisition), with such authority, duties and responsibilities as are commensurate with such position and as may be consistent with such position as may be assigned to him or her by the Board and (B) the Executive’s services shall be
performed at the Company’s offices in El Paso, Texas. Notwithstanding the foregoing, the Company and the Executive may mutually agree to such changes in the Executive’s position, reporting or location of employment as are in the best
interest of the Company without violating the provisions of this paragraph. 
  
 (ii) During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote substantially all of his or her attention and time during
normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive’s best efforts to perform faithfully and efficiently such
responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements, or
teach at educational institutions, and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with
this Agreement. 
  
 (b) Compensation. (i) Base Salary. During
the Employment Period, the Executive shall receive an annual base salary (“Annual Base Salary”), payable biweekly, at least equal to the annual base salary paid or payable, including any base salary which has been earned but deferred, to
the Executive by the Company in respect of the twelve-month period immediately preceding the occurrence of a Change in Control. During the Employment Period, the Annual Base Salary shall be reviewed no more than 12 months after the last salary
increase awarded to the Executive prior to the occurrence of a Change in Control and thereafter at least annually. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement.
Annual Base Salary shall not be reduced after any such increase and the term Annual Base Salary shall refer to Annual Base Salary as so increased. As used in this Agreement, the term 

  

 2 

 
“affiliated companies” shall include any company controlled by, controlling or under common control with the Company. 
  
 (ii) Annual Bonus. In addition to Annual Base Salary, for each fiscal year
ending during the Employment Period the Executive shall be eligible, based upon the Executive’s achievement of performance goals, and the Company’s achievement of financial and other operating goals, in each case set by the Compensation
Committee of the Board, in consultation with the Executive, at levels substantially consistent with past practice, during such fiscal year, to receive a bonus (the “Annual Bonus”) at a target level of not less than
                     of the Annual Base Salary (the “Target Bonus Amount”) with the opportunity, substantially consistent with past
practice, to earn in excess of such amount based upon the attainment of agreed upon performance goals. Each such Annual Bonus shall be paid no later than the last business day of the third month of the fiscal year next following the fiscal year for
which the Annual Bonus is awarded (the “Last Payment Date”). 
  
 (iii) Long-Term Incentive Compensation. During the Employment Period, the Executive shall be entitled to participate in all long-term incentive plans, practices, policies and programs applicable generally to other peer executives of the
Company. 
  
 (iv) Savings and Retirement Plans. During the
Employment Period, the Executive shall be entitled to participate in all savings and retirement plans, practices, policies and programs on a basis no less favorable than that generally applicable to peer executives of the Company. 
  
 (v) Welfare Benefit Plans. During the Employment Period, the Executive and/or
the Executive’s dependents, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company on a basis no less favorable than that
generally applicable to peer executives of the Company. 
  
 (vi)
Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the Company’s policies. 
  
 (vii) Vacation. During the Employment Period, the Executive shall be entitled
to paid vacation in accordance with the plans, policies, programs and practices of the Company on a basis no less favorable than that generally applicable to peer executives of the Company but, in any event, shall be entitled to no less than four
weeks of vacation per year during the Employment Period. 
  
 3.
Termination of Employment. (a) Death or Disability. The Executive’s employment shall terminate automatically upon the Executive’s death during the Employment Period. If the Disability of the Executive occurs during the Employment
Period pursuant to the definition of Disability set forth below, the Company may give the 
  

 3 

 Executive written notice, in accordance with Section 10(b) of this Agreement, of its intention to terminate the
Executive’s employment. In such event, the Executive’s employment with the Company shall terminate effective on the 60th day after receipt of such notice by the Executive (the “Disability Effective Date”); provided that, within
the 60 days after such receipt, the Executive shall not have returned to substantially full time performance of the Executive’s duties. For purposes of this Agreement, “Disability” shall mean the absence of the Executive from the
performance of the Executive’s duties with the Company on a full time basis for an aggregate of 120 out of any 180 consecutive business days as a result of incapacity due to mental or physical illness which is determined to be total and
permanent by an independent physician selected by the Company or its insurers and reasonably acceptable to the Executive or the Executive’s legal representative. 
  
 (b) Cause. The Company may terminate the Executive’s employment during the Employment Period for Cause. For purposes of
this Agreement, “Cause” shall mean the willful and continued failure by the Executive to perform his or her duties, or the engaging by the Executive in illegal conduct or misconduct which is materially injurious to the Company. The
cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire
membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board) finding that, in
the good faith opinion of the Board, the Executive is guilty of the conduct described above, and specifying the particulars thereof in detail. 
  
 (c) Good Reason. The Executive’s employment may be terminated by the Executive for Good Reason. For purposes of this Agreement, “Good
Reason” shall mean: 
  
 (i) a material reduction in
Executive’s duties or responsibilities, excluding for these purposes (A) assignment to a comparable position and duties in the division, subsidiary or other portion of any post-merger or post-acquisition successor that is operationally
responsible for the electric business conducted by the Company prior to the merger or acquisition, (B) an isolated and insubstantial action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof
given by the Executive, and (C) any action to which the Executive has given his or her written consent; 
  
 (ii) any failure by the Company to comply with any of the provisions of Section 2(b) of this Agreement, other than an isolated and insubstantial
failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive; 
  
 (iii) the Company’s requiring the Executive without the Executive’s written consent to be based at any office or location located more than 100
miles from the office or location provided in Section 2(a)(i)(B) hereof or the Company’s requiring the Executive to travel on 

  

 4 

 
Company business to a substantially greater extent than required immediately prior to the occurrence of a Change in Control; 
  
 (iv) any failure by the Company to comply with and satisfy Section 9(c)
of this Agreement; or 
  
 (v) the Company’s purported
termination of Agreement other than in accordance with its terms. 
  
 (d) Notice of Termination. Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 10(b) of this
Agreement. In the case of a Good Reason termination, such Notice of Termination shall be given within 90 days of the occurrence of the event that provides the basis for the termination as a condition of such claim being treated as a Good Reason
termination hereunder. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination (as defined below) is other than the date
of receipt of such notice, specifies the termination date (which date shall be not more than 30 days after the giving of such notice). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing
the Executive’s or the Company’s rights hereunder. 
  
 (e) Date of Termination. “Date of Termination” means (i) if the Executive’s employment is terminated by the Company for Cause, or by the Executive for any reason (including Good Reason), the date of receipt of the Notice
of Termination or any later date specified therein that is within 30 days of such Notice, as the case may be, (ii) if the Executive’s employment is terminated by the Company other than for Cause or Disability, the Date of Termination shall
be the date on which the Company notifies the Executive of such termination and (iii) if the Executive’s employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the
Disability Effective Date, as the case may be. 
  
 4. Obligations
of the Company upon Termination. (a) Good Reason; Other than for Cause, Death or Disability. If, during the Employment Period, the Company shall terminate the Executive’s employment other than for Cause or Disability or the Executive shall
terminate employment for Good Reason: 
  
 (i) the Company shall
pay to the Executive in a lump sum in cash within 30 days after the Date of Termination the aggregate of the following amounts: 
  

 5 

 A. the sum of (1) the Executive’s Annual Base Salary through the Date of Termination to the
extent not theretofore paid; (2) the product of (x) the target bonus of the Executive for the year of termination under the Company’s Annual Short-Term Bonus Plan (the “Target Bonus”) and (y) a fraction, the numerator
of which is the number of days in the current year through the Date of Termination, and the denominator of which is 365; and (3) any accrued vacation pay to the extent not theretofore paid (the sum of the amounts described in clauses (1), (2),
and (3) shall be hereinafter referred to as the “Accrued Obligations”); 
  
 B. the amount equal to the product of (1) [two] [three]1 and (2) the sum
of (x) the Executive’s Annual Base Salary and (y) the Target Bonus; and 
  
 C. the actuarial equivalent of the amounts by which the Executive’s total vested benefits under The El Paso Electric Company Retirement Plan (or any successor plan put into effect prior to a Change in Control),
computed as if Executive had [two] [three] 1 additional years of benefit accrual service, exceed the
Executive’s actual pension benefits. For this computation, the Executive’s final average salary shall be deemed to be the Executive’s annual base compensation in effect immediately prior to the time a Notice of Termination is given
and the benefit and accrual formulas and actuarial assumptions shall be no less favorable than those in effect at such time; “base compensation” shall include any amounts deducted by the Company for Executive’s account under any
agreement with the Company or Section 125 and 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”). 
  
 (ii) for two years after the Executive’s Date of Termination, or such longer period as may be provided by the terms of the appropriate plan, program,
practice or policy, the Company shall continue the medical, long-term disability, dental, accidental death and dismemberment and life insurance benefits to the Executive and/or the Executive’s dependents at least equal to those which would have
been provided to them in accordance with the plans, programs, practices and policies in effect under Section 2(b)(v) of this Agreement (the “Continuing Benefit Plans”) as if the Executive’s employment had not been terminated
(either by permitting the Executive and/or the Executive’s dependents to participate in the Continuing Benefit Plans, paying Executive’s premiums for COBRA coverage under applicable plans, by providing the Executive and/or the
Executive’s dependents with equivalent benefits outside the Continuing Benefit Plans or by providing Executive a cash payment sufficient for the Executive to purchase equivalent benefits, as the Company may elect, so long as the net after-tax
benefit to them is the same as if the Executive had remained an employee of the Company participating in the Continuing Benefit Plans); provided, however, that if the Executive becomes reemployed with another employer and is eligible to receive
medical, long-term disability, dental, accidental death and dismemberment or life insurance benefits under another employer-provided plan, the 
  

	1	3X for Hedrick, Bates, and Carrillo; 2X for others. 

  

 6 

 medical, long-term disability, dental, accidental death and dismemberment and life insurance benefits described herein
shall be secondary to those provided under such other plan during such applicable period of eligibility. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree benefits pursuant to the
Continuing Benefit Plans and any other welfare benefit plans, practices, policies and programs provided by the Company and its affiliated companies, the Executive shall be considered to have remained employed until two years after the Date of
Termination and to have retired on the last day of such period; 
  
 (iii) for one year after the Executive’s Date of Termination, the Company shall provide outplacement services for the Executive; and 
  
 (iv) to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any other amounts or benefits required to be
paid or provided or which the Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company, as of the Date of Termination (such other amounts are benefits shall be thereinafter referred to as
the “Other Benefits”). 
  
 (b) Death. If the
Executive’s employment is terminated by reason of the Executive’s death during the Employment Period, this Agreement shall terminate without further obligation to the Executive’s Legal Representatives under this Agreement, other than
for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of
Termination. The term Other Benefits as utilized in this Section 4(b) shall include death benefits as in effect on the date of the Executive’s death. 
  

(c) Disability. If the Executive’s employment is terminated by reason of the Executive’s Disability during the Employment Period, this
Agreement shall terminate without further obligation to the Executive, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to the Executive in a lump sum in cash
within 30 days of the Date of Termination. 
  
 (d) Cause; Other
than for Good Reason. If the Executive’s employment shall be terminated for Cause or the Executive terminates his or her employment without Good Reason during the Employment Period, this Agreement shall terminate without further obligation to
the Executive other than the obligation to pay to the Executive (x) his or her Annual Base Salary through the Date of Termination and (y) Other Benefits, in each case to the extent theretofore unpaid. 
  
 5. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company or any of its affiliated companies and for which the Executive may qualify, nor, subject to Section 10(f), shall
anything herein limit or otherwise affect 
  

 7 

 such rights as the Executive may have under any contract or agreement with the Company or any of its affiliated
Companies. Any rights that are vested and any benefits that the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company or any of its affiliated companies at or
subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement. 
  
 6. Full Settlement. In no event shall the Executive be obligated to seek other employment or take any other action by way of
mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and, except as provided in section 4(a)(ii) of this Agreement, such amounts shall not be reduced whether or not the Executive obtains other employment.
The Company agrees to pay as incurred, to the full extent permitted by law, all legal fees and expenses which the Executive may reasonably incur as a result of any contest regardless of the outcome thereof by the Company, the Executive or others of
the validity or enforceability of, liability under, any provision of this Agreement of any guarantee of performance thereof including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement; provided,
however, that the foregoing shall not apply in connection with any such contest in which the finder of fact determines that the contest is frivolous or was brought by the Executive in bad faith. 
  
 7. Gross-Up Provision. (a) If the payments provided by Section 4(a)
hereof (the “Agreement Payments”) would be subject to the tax imposed by Section 4999 of the Code (the “Excise Tax”), the Company shall pay to Executive at the time specified in Section 7(b) below an amount (the
“Gross-up Payment”) such that the net amount retained by Executive, after deduction of any Excise Tax on the Total Payments (as hereinafter defined), and any federal, state and local income tax and Excise Tax upon the Gross-up Payment
provided for by this subsection (a) shall be equal to what the Total Payments would have been had the Excise Tax not applied, as determined by the Company’s independent auditors or another nationally recognized public accounting firm
selected by the Company (in either case, the “Independent Auditors”). 
  
 For purposes of determining whether any of the Agreement Payments will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by Executive in
connection with a Change in Control or Executive’s termination of employment (under this Agreement or any other agreement with the Company or any person whose actions result in a Change in Control or any person affiliated with the Company)
(which, together with the Agreement Payments, shall constitute the “Total Payments”) shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute
payments” within the meaning of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel selected by the Independent Auditors such other payments or benefits (in whole or in part)
are not subject to the Excise Tax, (ii) the amount of the Total Payments which shall be treated as subject to the Excise Tax shall be equal to 
  

 8 

 the lesser of (A) the Total Payments or (B) the amount of excess parachute payments within the meaning of
Section 280G(b)(1) of the Code (after applying clause (i), above), and (iii) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Independent Auditors in accordance with the principles of
Sections 280G(d)(3) and (4) of the Code. 
  
 For purposes of
determining the Gross-up Payment, Executive shall be deemed to pay federal, state, and local income taxes at the highest applicable marginal rate for the calendar year in which the Gross-up Payment is to be made net of the maximum reduction in
federal income taxes which could be obtained from deduction of such state and local taxes. If the Excise Tax is finally determined to be less than the amount taken into account at the time the Gross-up Payment is made, Executive shall repay the
portion attributable to such reduction (plus the portion of the Gross-up Payment attributable to a reduction in Excise Tax and/or a federal and state and local income tax deduction), plus interest on the amount of such repayment at the rate provided
in Section 1274(b)(2)(B)of the Code. If the Excise Tax is later determined to exceed the amount taken into account at the time the Gross-up Payment is made, the Company shall make an additional gross-up payment (plus any interest payable with
respect to such excess at the rate provided in Section 1274(b)(2)(B) of the Code) when such excess is finally determined. 
  
 (b) The Gross-up Payment or portion thereof provided for in subsection (a) above shall be paid not later than the 45th day following payment of any
amounts under Section 4(a)(i). 
  
 8. (a) Confidential
Information. The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or any of its affiliated companies, and their respective businesses, which
shall have been obtained by the Executive during the Executive’s employment by the Company or any of its affiliated companies and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement). The Executive shall not, at any time during his or her employment with the Company or at any time thereafter, for any reason, in any fashion, form or manner, either directly or indirectly, communicate,
divulge, copy or permit to be copied (without the prior written consent of the Company or as may otherwise be required by law or legal process or in order to enforce his or her rights under this Agreement or as necessary to defend himself or herself
against a claim asserted directly or indirectly by the Company or any of its affiliated companies) any secret or confidential information, knowledge or data relating to the Company or any of its affiliated companies, and their respective businesses,
in any manner whatsoever, that is not otherwise publicly available to, or for the benefit of, any person, firm, corporation or other entity, other than the Company and those designated by it or in the course of his or her employment with the Company
and its affiliated companies. As used herein, the term “all secret or confidential information, knowledge or data relating to the Company or any of its affiliated companies, and their respective businesses” shall include, without
limitation, the Company’s plans, 
  

 9 

 strategies, proposals to potential customers and/or partners, costs, prices, proprietary systems for buying and selling,
client and customer lists, identity of prospects, proprietary computer programs, policy or procedure-manuals, proprietary training and recruiting procedures, proprietary accounting procedures, and the status and contents of the Company’s
contracts with its suppliers, clients, customers or prospects. The Executive further agrees to maintain in confidence any confidential information of third parties received as a result of his or her employment with the Company. 
  
 (b) Enforcement. In the event of a breach or threatened breach of this
Section 8, the Executive agrees that the Company shall be entitled, in addition to any other remedies available to it to specific performance and injunctive relief in a court of appropriate jurisdiction to remedy any such breach or threatened
breach, and the Executive acknowledges that damages would be inadequate and insufficient. In no event shall an asserted violation of the provisions of this Section 8 constitute a basis for deferring or withholding any amounts otherwise payable
to the Executive under this Agreement. 
  
 (c) Survival. Any
termination of the Executive’s employment or of this Agreement shall have no effect on the continuing operation of this Section 8. 
  
 9. Successors. (a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives. 
  
 (b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. 

 
 (c) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid (whether or not the Company
ceases to exist) which assumes and agrees to perform this Agreement by operation of law, or otherwise. In the event of any such succession, “Board” shall mean the board of directors or similar managing body of the successor to the Company.

  
 10. Miscellaneous. (a) This Agreement shall be governed
by and construed in accordance with the laws of the State of Texas, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not
be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives. 
  

 10 

 (b) All notices and other communications hereunder shall be in writing and shall be given by hand
delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows: 
  
 If to the Executive: 
  
 [                    ] 
  
 [                    ] 
  
 [                    ] 
  
 If to the Company: 
  
 El Paso Electric Company 
 100 North Stanton 
 El Paso, Texas 79901

 Attention: Board of Directors 
  
 or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually
received by the addressee. 
  
 (c) The invalidity or
unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. 
  
 (d) The Company may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld
pursuant to any applicable law or regulation. 
  
 (e) Subject to
Section 3(d) of this Agreement, the Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder,
including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c)(i)-(v) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or
right of this Agreement. 
  
 (f) This Agreement constitutes the
entire agreement between the parties and is intended to be an integration of all agreements between the parties with respect to the Executive’s employment by the Company on and after the occurrence of a Change in Control, the terms and
conditions of such employment or the termination of such employment. Any and all prior agreements, understandings or commitments between the 

  

 11 

 
Company and the Executive with respect to any such matter are hereby superseded and revoked. 
  
 (g) The Company shall indemnify and hold the Executive and his or her legal representatives harmless to the fullest extent
permitted by applicable law, from and against all judgments, fines, penalties, excise taxes, amounts paid in settlement, losses, expenses, costs, liabilities and legal fees if the Executive is made, or threatened to be made a party to any threatened
or pending or completed action, suit, proceeding, whether civil, criminal, administrative or investigative, including an action by or in the right of the Company or any of its affiliated companies to procure a judgment in its favor, by reasons of
the fact that the Executive is or was serving in any capacity at the request of the Company or any of its affiliated companies for any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise. The right to
indemnification provided, in this paragraph (g) shall not be deemed exclusive under any law or the charter or by-laws of the Company or any of its affiliated companies or otherwise, both as to action in the Executive’s official capacity
and as to action in another capacity while holding such office, and shall continue after the Executive has ceased to be a director or officer and shall inure to the benefit of the Executive’s heirs, executors and administrators. Any
reimbursement obligation arising hereunder shall be satisfied on an as-incurred basis. In addition, the Company agrees to continue to maintain customary and appropriate directors and liability insurance during the Employment Period and the Executive
shall be entitled to the protection of any such insurance policies on no less favorable a basis than is provided to any other officer or director of the Company or any of its affiliated companies. 
  

 12 

 IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written. 
  

	
	“EXECUTIVE”
	
	  

	[                    ]
	
	EL PASO ELECTRIC COMPANY
	
	  

	Gary R. Hedrick
	President and Chief Executive Officer

  

 13 

 Attachment 1 
  
 “Change in Control” shall mean: 
  
 (1) the acquisition by any individual, entity or group (a “Person”), including any “person” within the meaning of Section 13(d)
(3) or 14(d) (2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act, of 30% more of either (i) the then
outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); excluding, however, the following: (A) any acquisition directly from the Company (excluding any acquisition resulting from the exercise of an exercise, conversion or
exchange privilege unless the security being so exercised, converted or exchanged was acquired directly from the Company), (B) any acquisition by the Company, (C) any acquisition by an employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company, or (D) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (3) of this definition;

  
 (2) individuals who, as of March 10, 2005, constitute the
Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of such Board; provided that any individual who becomes a director of the Company subsequent to March 10, 2005 whose election, or
nomination for election by the Company’s stockholders, was approved by the vote of at least a majority of the directors then comprising the Incumbent Board shall be deemed a member of the Incumbent Board; and provided further, that any
individual who was initially elected as a director of the Company as a result of an actual or threatened election contest, as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act, or any other actual or threatened
solicitation of proxies or consents by or on behalf of any Person other than the Board shall not be deemed a member of the Incumbent Board; 
  
 (3) approval by the stockholders of the Company of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of
the assets of the Company (a “Corporate Transaction”); excluding, however, a Corporate Transaction pursuant to which (i) all or substantially all of the individual or entities who are the beneficial owners, respectively, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 60% of, respectively, the outstanding shares of common stock, and
the combined voting power of the outstanding securities of such corporation entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or indirectly) in substantially the same 
  

 A-1 

 proportions relative to each other as their ownership, immediately prior to such Corporate Transaction, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than: the Company; any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company; the corporation resulting from such Corporate Transaction; and any Person which beneficially owned, immediately prior to such Corporate Transaction, directly or indirectly, 30% or more of the Outstanding Company Common
Stock or the Outstanding Company Voting Securities, as the case may be) will beneficially own, directly or indirectly, 30% or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction
or the combined voting power of the outstanding securities of such corporation entitled to vote generally in the election of directors and (iii) individuals who were members of the Incumbent Board will constitute at least a majority of the
members of the board of directors of the corporation resulting from such Corporate Transaction; or 
  
 (4) approval by the stockholders of the Company of a plan of complete liquidation or dissolution of the Company. 
  
 Notwithstanding the foregoing, in no event shall a “Change in
Control” be deemed to have occurred as a result of the formation of a Holding Company. For the purposes hereof, “Holding Company” shall mean an entity that becomes a holding company for the Company or its businesses as a part of any
reorganization, merger, consolidation or other transaction, provided that the outstanding shares of common stock of such entity and the combined voting power of such entity entitled to vote generally in the election of directors is, immediately
after such reorganization, merger, consolidation or other transaction, beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company
Voting Securities immediately prior to such reorganization, merger, consolidation or other transaction in substantially the same proportions as their ownership, immediately prior to such reorganization, merger, consolidation or other transaction, of
such Outstanding Company Voting Securities. 
  

 A-2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00092-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00092-of-00352.parquet"}]]