Document:

Exhibit 10.42

PROMISSORY NOTE

 

	
Borrower:

 

 

	
Community West Bancshares

445 Pine Avenue

Goleta, California 93117

Attention:  Marty Plourd

	
Lender:

	
Grandpoint Bank

355 South Grand Avenue       Suite 2400

Los Angeles, CA 90071

Attention:  Mark Walsh

	
Principal Amount:  $10,000,000.00

	
 

	Date:  October 29, 2015

 

PROMISE TO PAY.  COMMUNITY WEST BANCSHARES, a California corporation (“Borrower”), promises to pay to the order of GRANDPOINT BANK, a California state-chartered bank (“Lender”), the principal amount of Ten Million Dollars ($10,000,000.00) or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each Advance at the applicable interest rate as provided herein.  Interest shall be calculated from the date of each Advance until repayment of each Advance or, with respect to the Term Loan, from the Conversion Date until repayment of the Term Loan.  All principal, interest and other sums due hereunder shall be payable, without offset or deduction, in lawful money of the United States.  This Promissory Note (this “Note”) evidences a loan by Lender to Borrower pursuant to that certain Credit Agreement by Lender and Borrower dated concurrently herewith, as it may be supplemented, amended or restated from time to time (the “Credit Agreement”).  All capitalized terms not defined herein shall have the meanings given to such terms in the Credit Agreement.

PAYMENT.

A.            QUARTERLY INTEREST-ONLY PAYMENTS ON THE LINE OF CREDIT DURING THE REVOLVING TERM.  Borrower shall make quarterly interest payments on February 1, 2016, May 1, 2016, August 1, 2016 and November 1, 2016 in an amount equal to all unpaid interest accrued on the principal balance of this Note based on the average balance outstanding during the preceding three months.  Such payments shall be calculated based on the interest rate applicable hereunder during the period immediately preceding each payment date, as adjusted in accordance with the terms hereof.

B.            PRINCIPAL AND INTEREST PAYMENTS AFTER THE CONVERSION DATE.  Unless the Line of Credit is repaid in full on or before October 31, 2016 (the “Conversion Date”), the Line of Credit shall convert to a Term Loan on the Conversion Date pursuant to the terms of the Credit Agreement.  In such event, Borrower shall make quarterly principal payments equal to five percent (5%) of the principal balance outstanding as of the Conversion Date, plus interest, which quarterly payments shall be due and payable on the first Business Day of each February, May, August and November, commencing February 1, 2017, until October 31, 2021 (the “Maturity Date”).  Borrower shall pay the entire outstanding principal balance of the Term Loan, together with all accrued and unpaid interest, on the Maturity Date.  Interest shall be calculated for each month during the preceding three-month period based on the average balance outstanding for the month at the applicable interest rate hereunder for the month.  Lender shall determine interest as of ten (10) days before the applicable payment date (each, a “Determination Date”), and shall make appropriate adjustments to reflect activity occurring after a Determination Date, which Lender shall carry over to the next applicable billing cycle.

C.            PAYMENT ON MATURITY DATE.  On the Maturity Date, the entire outstanding principal balance of this Note, together with all accrued and unpaid interest, shall become immediately due and payable.

D.            ORDER OF PAYMENT.  Unless otherwise agreed or required by applicable law, for so long as no Event of Default shall exist, payments will be applied first to all costs, advances, expenses or fees due, owing and/or payable to Lender, or paid or incurred by Lender, arising from or out of this Note, the Credit Agreement, the Stock Pledge and Security Agreement and the other Related Documents; second to any late charges and to any and all interest due, owing and/or accrued; and third to payment of the outstanding principal balance on this Note.  Borrower will pay Lender at Lender’s address shown above or at such other place as Lender may designate in writing.  For so long as an Event of Default is continuing, Lender may apply all payments received on account of the Loan to amounts outstanding under this Note in such order and amount as Lender may elect in its sole discretion.  Interest, late charges, costs, or expenses that are not received by Lender within ten (10) calendar days from the date such interest, late charges, costs, or expenses become due, shall, at the sole discretion of Lender, be added to the principal balance and shall from the date due bear interest at the Default Rate specified below.

E.            PRINCIPAL PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges are earned fully as of the date of the Loan and will not be subject to refund upon early payment (whether voluntary or as a result of default), except as otherwise required by law.   Except for the foregoing, and subject to the provisions of the Credit Agreement, including Section 4(B) thereof, Borrower may pay without penalty all or a portion of the amount owed earlier than it is due.  Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued and unpaid interest.  Rather, early payments will reduce the principal balance due.  Borrower agrees not to send Lender payments marked “paid in full,” “without recourse,” or similar language.  If Borrower sends such a payment, Lender may accept it without losing any of Lender’s rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender.

 

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F.            NON-BUSINESS DAYS.  Whenever any payment to be made under this Note shall be due on a day other than a day on which Lender is open for business in Los Angeles, California, (a “Business Day”), then the due date for such payment shall be automatically extended to the next succeeding Business Day, and such extension of time shall in such cases be included in the computation of the interest portion of any payment due hereunder.

INTEREST.

A.            INTEREST RATE.  Except as otherwise expressly provided in this Note, interest shall accrue on the unpaid principal owing hereunder from the date on which any Advances are funded pursuant to the Credit Agreement through the date that all Indebtedness and other amounts evidenced by, or payable under, this Note are paid in full, whether upon the Maturity Date, acceleration, or otherwise, at the per annum rate equal to (the “Regular Interest Rate”) 375 basis points (3.75%) in excess of the rate for the London Interbank Offered Rate (Libor Rate) for one month US Dollar deposits as published in the “Money Rates Section” (or other applicable section) of the Wall Street Journal (the “Index”) on the first Business Day of each month for which interest is calculated.  If the Index becomes unavailable, Lender will choose a new Index based on comparable information.  The selection of an alternative Index shall be made in Lender’s sole discretion.  Lender will give Borrower notice of such selection.

B.            INTEREST CALCULATION METHOD.  Interest on this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.  All interest payable under this Note is computed using this method.

C.            COMPENSATING BALANCE REQUIREMENT.  Borrower agrees to maintain with Lender average collected demand deposit compensating balances that, for any three month period ending January 31, April 30, July 31 or October 31, equal or exceed twenty-five percent (25%) of the average outstanding principal balance under this Note (the “Minimum Balances”).  In the event the Minimum Balances are not met with respect to any applicable three-month period, the Regular Interest Rate for each month during such three month period shall be increased to 425 basis points (4.25%) in excess of the Index. 

D.            INTEREST RATE AFTER DEFAULT.  For so long as an Event of Default shall be continuing (but only after the expiration of any applicable grace periods or notice and cure periods), the interest rate on this Note shall, at Lender’s option, increase to the sum of (a) five percent (5.00%) plus (b) the Regular Interest Rate (the “Default Rate”).

UNUSED COMMITMENT FEE.  During the Revolving Term, Borrower shall pay to Lender quarterly, in arrears, within thirty (30) days after each billing is sent by Lender, an amount calculated as of the last day of each three-month period ending January 31, 2016, April 30, 2016, July 31, 2016 and October 31, 2016 equal to one-half percent (0.5%) per annum of the unused portion of the Line of Credit (the “Unused Commitment Fee”).  The Unused Commitment Fee shall be calculated based on the average unused portion of the Line of Credit during the preceding three-month period.

LATE CHARGE.  Time is of the essence for all payments and other obligations due under this Note.  Borrower acknowledges that if any payment required under this Note is not received by Lender within ten (10) days after the same becomes due and payable, Lender will incur extra administrative expenses (i.e., in addition to expenses incident to receipt of timely payment) and the loss of the use of funds in connection with the delinquency in payment.  Because the actual damages suffered by Lender by reason of such administrative expenses and loss of use of funds would be impracticable or extremely difficult to ascertain, Borrower agrees that five percent (5.00%) of the amount of the delinquent payment, together with interest accruing on the entire unpaid principal balance of this Note at the Default Rate, as provided above, shall be the amount of damages which Lender is entitled to receive upon such breach, in compensation therefor.  Therefore, Borrower shall, in such event, without further demand or notice, pay to Lender, as Lender’s monetary recovery for such extra administrative expenses and loss of use of funds, liquidated damages in the amount of five percent (5.00%) of the amount of the delinquent payment (in addition to interest at the Default Rate).  The provisions of this paragraph are intended to govern only the determination of damages in the event of a breach in the performance of Borrower to make timely payments hereunder.  Nothing in this Note shall be construed as in any way giving Borrower the right, express or implied, to fail to make timely payments hereunder, whether upon payment of such damages or otherwise.  The right of Lender to receive payment of such liquidated and actual damages, and receipt thereof, are without prejudice to the right of Lender to collect such delinquent payments and any other amounts provided to be paid hereunder or under the Credit Agreement, the Stock Pledge and Security Agreement and/or the other Related Documents, or to declare a default hereunder or under the Credit Agreement, the Stock Pledge and Security Agreement and/or the other Related Documents.

ACCELERATION.  Upon the occurrence of an Event of Default or as otherwise provided in the Credit Agreement (but only after the expiration of any applicable grace periods or notice and cure periods), in addition to other default remedies available to Lender, Lender may declare the entire unpaid principal balance under this Note and all accrued unpaid interest immediately due and payable.

 

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ATTORNEYS’ FEES; EXPENSES. Borrower agrees to pay upon demand all of Lender’s reasonable costs and expenses, including Lender’s reasonable attorneys’ fees and Lender’s legal expenses, incurred in connection with the enforcement of this Note.  Lender may hire or pay someone else to help enforce this Note, and Borrower shall pay the costs and expenses of such enforcement.  Costs and expenses include Lender’s reasonable attorneys’ fees and legal expenses whether or not there is a lawsuit, including reasonable attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services.  Borrower also shall pay all court costs and such additional fees as may be directed by the court.  Notwithstanding the foregoing, in the event that an arbitrator appointed pursuant to the section entitled “Arbitration of Disputes,” below, determines that any action brought by Lender against Borrower or its Subsidiary Banks is frivolous, Lender shall be responsible for all costs and expenses, including Borrower’s and its Subsidiary Banks’ reasonable attorneys’ fees and legal expenses, incurred in connection with such frivolous action.

COLLATERAL.  Borrower acknowledges this Note is secured by Stock Pledge and Security Agreement dated concurrently herewith by Borrower in favor of Lender.

LINE OF CREDIT.  Upon and subject to the terms and conditions of the Credit Agreement, during the Revolving Term only, Borrower may borrow against this Note under the circumstances, in the manner and for the purposes specified in the Credit Agreement, but for no other purposes.   Advances against this Note by Lender or other holder shall be governed by the terms of the Credit Agreement.  The unpaid principal balance of this Note at any time shall be the total of all principal lent or advanced against this Note less the sum of all principal payments made on this Note by or for the account of Borrower.  Absent manifest error, Lender’s (or, if applicable, such other holder’s) records shall on any day conclusively evidence the unpaid balance of this Note and its advances and payments history posted up to that day.  Borrower agrees to be liable for all sums either:  (A) advanced in accordance with the instructions of a Responsible Officer or (B) credited to any of Borrower’s accounts with Lender.  The unpaid principal balance owing on this Note at any time may be evidenced by endorsements on this Note or by Lender’s internal records, including daily computer printouts.

NO OFFSETS OR DEDUCTIONS.  All payments under the Note shall be made by Borrower without any offset, decrease, reduction or deduction of any kind or nature whatsoever, including, but not limited to, any decrease, reduction or deduction for, or on account of, any offset, withholdings, present or future taxes, present or future reserves, imposts or duties of any kind or nature that are imposed or levied by or on behalf of any government and/or taxing agency, body or authority by or for any municipality, state, or nation.  If at any time, present or future, Lender shall be compelled by any law, rule, regulation and/or any other such requirement which on its face or by its application requires and/or establishes reserves, or payment, deduction or withholding of taxes, imposts or duties to act such that it causes or results in a decrease, reduction and/or deduction, in payment received by Lender, then Borrower shall pay to Lender such additional amounts, as Lender shall deem necessary and appropriate, such that every payment received under this Note, after such decrease, reserve, reduction, deduction, payment and/or required withholding, shall not be reduced in any manner whatsoever; provided Lender charges other borrowers with similar loans from Lender on generally the same basis that amounts due from Borrower are determined.

WAIVERS.  Lender shall not be deemed to have waived any rights under this Note unless such waiver is given in writing and signed by Lender.  No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right.  A waiver by Lender of a provision of this Note shall not prejudice or constitute a waiver of Lender’s right otherwise to demand strict compliance with that provision or any other provision of this Note.  No prior waiver by Lender, nor any course of dealing between Lender and Borrower, shall constitute a waiver of any of Lender’s rights or of any of Borrower’s obligations as to any future transactions.  Whenever the consent of Lender is required under this Note, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in Lender’s reasonable discretion.  Subject to all applicable notice and cure provisions provided in this Note and the Credit Agreement, Borrower hereby waives grace, diligence, presentment, demand, notice of demand, dishonor, notice of dishonor, protest, notice of protest, any and all exemption rights against the indebtedness evidenced by this Note and the right to plead any statute of limitations as a defense to the repayment of all or any portion of this Note, and interest thereon, to the fullest extent allowed by law, and all compensation of cross‐demands pursuant to California Code of Civil Procedure Section 431.70.

AMENDMENT.  No alteration of or amendment to this Note shall be effective unless given in writing and signed by Lender and Borrower.

SUCCESSORS AND ASSIGNS.  All covenants and agreements by or on behalf of Borrower contained in this Note shall bind Borrower’s successors and assigns and shall inure to the benefit of Lender and its successors and assigns.  Borrower shall not, however, have the right to assign Borrower’s rights under this Note or any interest herein, without the prior written consent of Lender.

GOVERNING LAW.  This Note is governed by the laws of the State of California.  This Note has been accepted by Lender in the State of California.

NOTICES.  Any notice required to be given under this Note shall be given in writing, and shall be effective when actually delivered, by a nationally recognized overnight courier, by the United States mail, as first class, certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Note, or by email.  Notices given by email to Lender shall be sent to mwalsh@grandpointbank.com.  Notices given by email to Borrower shall be sent to mplourd@communitywestbank.com and to cbaltuskonis@communitywestbank.com.  Any party may change its address and/or email address for notices under this Note by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the party’s address.  For notice purposes, Borrower agrees to keep Lender informed at all times of Borrower’s current address.

 

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SEVERABILITY.  If a court of competent jurisdiction finds any provision of this Note to be illegal, invalid, or unenforceable as to any circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other circumstance.  If feasible, the offending provision shall be considered modified so that it becomes legal, valid and enforceable.  If the offending provision cannot be so modified, it shall be considered deleted from this Note.  Unless otherwise required by law, the illegality, invalidity, or unenforceability of any provision of this Note shall not affect the legality, validity or enforceability of any other provision of this Note.

CONSTRUCTION OF NOTE.  Neither this Note nor any uncertainty or ambiguity herein shall be construed or resolved against Lender or Borrower, whether under any rule of construction or otherwise.  On the contrary, this Note has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties.  It is acknowledged by the parties that: (i) each party is of equal bargaining strength; (ii) each party has actively participated in the drafting, preparation and negotiation of this Note; and (iii) any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Note, any portion hereof or any amendments hereto.  Caption headings in this Note are for convenience purposes only and are not to be used to interpret or define the provisions of this Note.

LENDER’S CONSENT.  Wherever in this Note there is a requirement for Lender’s consent, it is understood that Lender shall exercise its consent, right or judgment reasonably and without undue delay.

AUTHORITY TO FILE NOTICES.  Borrower appoints and designates Lender as its attorney-in-fact to file for the record any notice that Lender deems necessary to protect its interest under this Note.  This power shall be deemed coupled with an interest and shall be irrevocable while any sum or performance remains due and owing under any of the Related Documents.

ARBITRATION OF DISPUTES.

A.            EXCEPT AS SPECIFICALLY PROVIDED HEREIN, ALL DISPUTES, CLAIMS, OR CONTROVERSIES (WHETHER SOUNDING IN TORT OR CONTRACT OR BASED UPON A STATUTE) (HEREINAFTER “CLAIMS”) ARISING OUT OF, BASED UPON, OR RELATING TO THIS NOTE SHALL BE SUBMITTED TO BINDING ARBITRATION BEFORE A RETIRED JUDGE OF JAMS, LLC IN CALIFORNIA PURSUANT TO THE JAMS, LLC COMPREHENSIVE ARBITRATION RULES AND PROCEDURES.  JUDGMENT UPON THE ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF AND SHALL BE FINAL, BINDING, AND NONAPPEALABLE.  NOTWITHSTANDING THE FOREGOING, THIS CLAUSE SHALL NOT:

	 	(i)	LIMIT OR PROHIBIT LENDER OR BORROWER FROM BRINGING ANY ACTION IN ANY COURT OF COMPETENT JURISDICTION FOR INJUNCTIVE RELIEF; FOR APPOINTMENT OF A RECEIVER; FOR PROVISIONAL REMEDIES, INCLUDING TEMPORARY PROTECTIVE ORDERS AND WRITS OF ATTACHMENT; OR FOR JUDICIAL FORECLOSURE; AND THE FILING OF SUCH ACTIONS BY LENDER OR BORROWER SHALL NOT:

		(a)	CONSTITUTE A WAIVER OF THIS ARBITRATION PROVISION; OR

		(b)	LIMIT THE COURT FROM REFERRING AS MUCH OF THE CLAIMS IN THE ACTION TO ARBITRATION AS POSSIBLE; OR

		(ii)	LIMIT OR PROHIBIT LENDER FROM EXERCISING ANY OF ITS RIGHTS AS LENDER UNDER THIS NOTE INCLUDING, WITHOUT LIMITATION, THE INVOCATION OF THE POWER OF SALE UNDER ANY DEED OF TRUST SECURING THIS NOTE OR THE USE OF ANY SET‐OFF OR LIEN RIGHTS;

B.            THIS ARBITRATION PROVISION SHALL BE DEEMED TO BE SELF-EXECUTING AND IN THE EVENT THAT LENDER OR BORROWER FAILS TO APPEAR AT ANY PROPERLY NOTICED ARBITRATION PROCEEDING, AN AWARD MAY BE ENTERED AGAINST THE PARTY FAILING TO APPEAR NOTWITHSTANDING ITS FAILURE TO APPEAR.

C.            THE ARBITRATOR IS SPECIFICALLY AUTHORIZED TO, AND AS APPROPRIATE, SHALL RECOMMEND OR AWARD TO THE PREVAILING PARTY IN THE ARBITRATION PROCEEDINGS ITS REASONABLE ATTORNEYS’ FEES AND COSTS, INCLUDING, WITHOUT LIMITATION, JAMS, LLC ADMINISTRATION FEES AND THE ARBITRATOR’S FEES.  THE PREVAILING PARTY SHALL ALSO BE ENTITLED TO RECOVER THE REASONABLE ATTORNEYS’ FEES AND COSTS IT INCURS IN CONNECTION WITH THE CONFIRMATION OF THE AWARD AND ANY PROCEEDINGS REQUIRED TO ENFORCE A JUDGMENT BASED ON THE AWARD.

 

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D.            BY EXECUTING THIS NOTE, BORROWER DOES HEREBY WAIVE TO THE FULLEST EXTENT POSSIBLE ITS RIGHT TO JURY TRIAL UNDER THE UNITED STATES CONSTITUTION, THE CONSTITUTION OF THE STATE OF CALIFORNIA AND ALL APPLICABLE STATUTES, AND SUCH WAIVER SHALL EXTEND TO ANY AND ALL CLAIMS, REGARDLESS OF WHETHER SUCH CLAIMS ARE ULTIMATELY ARBITRATED PURSUANT TO THIS PROVISION OR DECIDED THROUGH JUDICIAL PROCEEDINGS.

 

	 		 
	 	 	 
	 	
Borrower’s Initials

	 

 

GENERAL PROVISIONS.  If any part of this Note cannot be enforced, this fact will not affect the rest of the Note.  Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them.  Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive any applicable statute of limitations, presentment, demand for payment, and notice of dishonor.  Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability.  All such parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or release any party, partner, or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s security interest in the Pledged Stock; and take any other action deemed necessary by Lender without the consent of or notice to anyone.

IN WITNESS WHEREOF, Borrower has executed this Promissory Note on the date first set forth above.

BORROWER:

COMMUNITY WEST BANCSHARES,

a California corporation

 

	
By:

	  	 
	 	
Name:

	 	 
	 	
Title:

	 	 

 

5Exhibit

Exhibit 10.2

SEPARATION AGREEMENT AND RELEASE
This Separation Agreement and Release (this “Agreement”) is entered into by Matador Resources Company, a Texas corporation (“Matador” or the “Company”), and Ryan C. London (“Employee”) as of August 31, 2015 (the “Agreement Date”). Matador and Employee are referred to as the “Parties.” This Agreement cancels and supersedes all prior agreements relating to Employee’s employment with Matador except as provided in this Agreement. 
WHEREAS, Matador and Employee entered into an Employment Agreement as of March 13, 2014, effective January 1, 2014 (the “Employment Agreement”). This Agreement is entered into by and between Employee and Matador pursuant to the Employment Agreement; 
WHEREAS, because of Employee’s employment as an employee of Matador, Employee has obtained intimate and unique knowledge of all aspects of Matador’s business operations, current and future plans, financial plans and other confidential and proprietary information; 
WHEREAS, Employee’s employment with Matador and all other positions, if any, held by Employee in Matador or any of its subsidiaries or affiliates, including officer positions, shall terminate effective as of September 1, 2015 (the “Separation Date”); and 
WHEREAS, except as otherwise provided herein, the Parties desire to finally, fully and completely resolve all disputes that now or may exist between them, including, but not limited to those concerning the Employment Agreement (except for the post-termination obligations contained in the Employment Agreement), Employee’s job performance and activities while employed by Matador and Employee’s hiring, employment and separation from Matador, and all disputes over benefits and compensation connected with such employment; 
NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows: 
1.    End of Employee’s Employment. Employee’s employment with Matador shall terminate on the Separation Date. 
2.    Certain Payments and Benefits. 
(a)    Accrued Obligations. In accordance with Matador’s customary payroll practices, Matador shall pay Employee for all unpaid salary, unreimbursed business expenses, and any accrued but unused vacation through the Separation Date (“Accrued Obligations”). 
(b)    Separation Payments. Subject to Employee’s consent to and fulfillment of Employee’s obligations in this Agreement and Employee’s post-termination obligations in Sections 8 and 9 of the Employment Agreement, modified as described below, Matador shall pay Employee the amount of $225,000, minus normal payroll withholdings and taxes (“Separation Payment”), payable in a lump sum on or 

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before September 4, 2015. The Separation Payment will not be treated as compensation under Matador’s 401(k) Plan or any other retirement plan. 
(c)    Waiver of Additional Compensation or Benefits. Other than the compensation and payments provided for in this Agreement and the post-termination benefits provided for in the Employment Agreement, Employee shall not be entitled to any additional compensation, benefits, payments or grants under any agreement, benefit plan, severance plan or bonus or incentive program established by Matador or any of Matador’s affiliates, other than any vested retirement plan benefits, any vested equity grants or COBRA continuation coverage benefits. Employee agrees that the release in Section 5 covers any claims Employee might have regarding Employee’s compensation, bonuses, stock options or grants and any other benefits Employee may or may not have received during Employee’s employment with Matador. 
3.    Non-Competition and Non-Solicitation Modification. The parties agree that, with respect to the non-competition provision contained in Section 9(a) of the Employment Agreement, the Restricted Period shall last for a time period of six months after the Separation Date. The parties further agree that, with respect to the non-solicitation provision contained in Section 9(b) of the Employment Agreement, the Restricted Period shall last for a time period of twelve months after the Separation Date.
4.    Modification of Post-Termination Determination of Just Cause by the Company. The parties agree that the clawback provision contained in Section 12(e) of the Employment Agreement shall apply only in the event that the Company subsequently discovers the existence of facts or circumstances that would have been grounds for Employee’s termination for Just Cause according to Sections 12(e)(iv), (v), or (vi) of the Employment Agreement.  
5.    General Release and Waiver. In consideration of the payments and other consideration provided for in this Agreement, that being good and valuable consideration, the receipt, adequacy and sufficiency of which are acknowledged by Employee, Employee, on Employee’s own behalf and on behalf of Employee’s agents, administrators, representatives, executors, successors, heirs, devisees and assigns (collectively, the “Releasing Parties”) hereby fully releases, remises, acquits and forever discharges Matador and all of its affiliates, and each of their respective past, present and future officers, directors, shareholders, equity holders, members, partners, agents, employees, consultants, independent contractors, attorneys, advisers, successors and assigns (collectively, the “Released Parties”), jointly and severally, from any and all claims, rights, demands, debts, obligations, losses, causes of action, suits, controversies, setoffs, affirmative defenses, counterclaims, third party actions, damages, penalties, costs, expenses, attorneys’ fees, liabilities and indemnities of any kind or nature whatsoever (collectively, the “Claims”), whether known or unknown, suspected or unsuspected, accrued or unaccrued, whether at law, equity, administrative, statutory or otherwise, and whether for injunctive relief, back pay, fringe benefits, reinstatement, reemployment, or compensatory, punitive or any other kind of damages, which any of the Releasing Parties ever have had in the past or presently have against the Released Parties, and each of them, arising from or relating to Employee’s employment with Matador or its affiliates or the termination of that employment or any circumstances related thereto, or (except as otherwise 

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provided below) any other matter, cause or thing whatsoever, including without limitation all claims arising under or relating to employment, employment contracts, employee benefits or purported employment discrimination or violations of civil rights of whatever kind or nature, including without limitation all claims arising under the Americans with Disabilities Act, as amended, the Family and Medical Leave Act of 1993, the Equal Pay Act of 1963, the Rehabilitation Act of 1973, Title VII of the United States Civil Rights Act of 1964, 42 U.S.C. § 1981, the Employee Retirement Income Security Act, the Civil Rights Act of 1991, the Civil Rights Acts of 1866 and/or 1871, the Genetic Information Nondiscrimination Act, the Texas Payday Law, the Texas Labor Code or any other applicable federal, state or local employment statute, law or ordinance, including, without limitation, any disability claims under any such laws, claims for wrongful discharge, claims arising under state law, contract claims including breach of express or implied contract, alleged tortious conduct, claims relating to alleged fraud, breach of fiduciary duty or reliance, breach of implied covenant of good faith and fair dealing, and any other claims arising under state or federal law, as well as any expenses, costs or attorneys’ fees. Employee further agrees that Employee will not file or permit to be filed on Employee’s behalf any such claim. Notwithstanding the preceding sentence or any other provision of this Agreement, this release is not intended to interfere with Employee’s right to file a charge with the Equal Employment Opportunity Commission (the “EEOC”), or other comparable agency, in connection with any claim Employee believes Employee may have against Matador or its affiliates. However, by executing this Agreement, Employee hereby waives the right to recover in any proceeding Employee may bring before the EEOC or any state human rights commission or in any proceeding brought by the EEOC or any state human rights commission on Employee’s behalf. This release shall not apply to any of Matador’s obligations under this Agreement or post-termination obligations under the Employment Agreement, any vested retirement plan benefits, any vested equity grants or COBRA continuation coverage benefits. Employee acknowledges that certain of the payments and benefits provided for in Section 2 of this Agreement constitute good and valuable consideration for the release contained in this Section 5. 
6.    Return of Matador Property. Within seven days of the Agreement Date, Employee shall, to the extent not previously returned or delivered: (a) return all equipment, records, files, programs or other materials and property in Employee’s possession which belongs to Matador or any of its affiliates, including, without limitation, all computers, printers, laptops, personal data assistants, cell phones, credit cards, keys and access cards; and (b) deliver all original and copies of Confidential Information (as defined in the Employment Agreement) in Employee’s possession and notes, materials, records, plans, technical data or other documents, files or programs (whether stored in paper form, computer form, digital form, electronically or otherwise) in Employee’s possession that contain Confidential Information. By signing this Agreement, Employee represents and warrants that Employee has not retained and has or will timely return and deliver all the items described or referenced in subsections (a) or (b) above; and, that should Employee later discover additional items described or referenced in subsections (a) or (b) above, Employee will promptly notify Matador and return/deliver such items to Matador. 
7.    Non-Disparagement. Employee agrees that Employee will not, directly or indirectly, disclose, communicate, or publish any disparaging information concerning Matador or the Released Parties, or cause others to disclose, communicate or publish any disparaging information concerning the same. Matador, on its own behalf and on behalf of its officers and directors, agrees that they 

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will not, directly or indirectly, disclose, communicate or publish any disparaging information concerning Employee, or cause others to disclose, communicate, or publish any disparaging information concerning Employee. Notwithstanding the foregoing, the provisions of this Section shall not apply with respect to any charge filed by Employee with the EEOC or other comparable agency or in connection with any proceeding with respect to any claim not released by this Agreement. 
8.    Not An Admission of Wrongdoing. This Agreement shall not in any way be construed as an admission by either Party of any acts of wrongdoing, violation of any statute, law or legal or contractual right. 
9.    Voluntary Execution of the Agreement. Employee and Matador represent and agree that they have had an opportunity to review all aspects of this Agreement, and that they fully understand all the provisions of the Agreement and are voluntarily entering into this Agreement. Employee further represents that Employee has not transferred or assigned to any person or entity any claim involving Matador or any portion thereof or interest therein. 
10.    Ongoing Obligations. Employee reaffirms and understands Employee’s ongoing obligations in the Employment Agreement, including Sections 8, 9 (as modified herein), 10, 11 and 21. 
11.    Binding Effect. This Agreement shall be binding upon Matador and upon Employee and Employee’s heirs, administrators, representatives, executors, successors and assigns and Matador’s representatives, successors and assigns. In the event of Employee’s death, this Agreement shall operate in favor of Employee’s estate and all payments, obligations and consideration will continue to be performed in favor of Employee’s estate. 
12.    Severability. Should any provision of this Agreement be declared or determined to be illegal or invalid by any government agency or court of competent jurisdiction, the validity of the remaining parts, terms or provisions of this Agreement shall not be affected and such provisions shall remain in full force and effect. 
13.    Entire Agreement. Except for the post-termination obligations in the Employment Agreement, as modified by this Agreement, any vested retirement plan benefits, any equity grant agreements and COBRA continuation coverage benefits, this Agreement sets forth the entire agreement between the Parties, and fully supersedes any and all prior agreements, understandings, or representations between the Parties pertaining to Employee’s employment with Matador, the subject matter of this Agreement or any other term or condition of the employment relationship between Matador and Employee. Employee represents and acknowledges that in executing this Agreement, Employee does not rely, and has not relied, upon any representation(s) by Matador or its agents except as expressly contained in this Agreement or the Employment Agreement. Employee and Matador agree that they have each used their own judgment in entering into this Agreement. 
14.    Knowing and Voluntary Waiver. Employee, by Employee’s free and voluntary act of signing below, acknowledges that Employee has been advised to consult with an attorney prior to executing this Agreement and agrees to all of the terms of this Agreement and intends to be legally 

4

bound thereby. The Parties acknowledge and agree that each Party has reviewed and negotiated the terms and provisions of this Agreement and has contributed to its preparation (with advice of counsel). Accordingly, the rule of construction to the effect that ambiguities are resolved against the drafting party shall not be employed in the interpretation of this Agreement. Rather, the terms of this Agreement shall be construed fairly as to both Parties and not in favor of or against either Party, regardless of which Party generally was responsible for the preparation of this Agreement. This Agreement will become effective, enforceable and irrevocable on the date on which it is executed by both the Company and Employee (the “Effective Date”). 
15.    Notices. All notices and other communications hereunder will be in writing. Any notice or other communication hereunder shall be deemed duly given if it is delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid, and addressed to the intended recipient as set forth: 
If to Employee: 

Ryan C. London
[Address]
[City, State Zip]

If to Matador: 

Matador Resources Company 
One Lincoln Centre 
5400 LBJ Freeway, Suite 1500 
Dallas, TX 75240 
Attention: Board of Directors 

Any Party may change the address to which notices and other communications are to be delivered by giving the other Party notice. 
16.    Governing Law; Venue; Arbitration. This section of the Agreement shall be governed by Section 23 of the Employment Agreement. 
17.    Counterparts. This Agreement may be executed in counterparts, each of which when executed and delivered (which deliveries may be by facsimile or other electronic method of delivery) shall be deemed an original and all of which together shall constitute one and the same instrument. 
18.    No Assignment of Claims. Employee represents and agrees that Employee has not transferred or assigned, to any person or entity, any claim involving Matador, or any portion thereof or interest therein. 
19.    No Waiver. This Agreement may not be waived, modified, amended, supplemented, canceled or discharged, except by written agreement of the Parties. Failure to exercise and/or delay in exercising any right, power or privilege in this Agreement shall not operate as a waiver. No waiver of any breach of any provision shall be deemed to be a waiver of any preceding or succeeding breach 

5

of the same or any other provision, nor shall any waiver be implied from any course of dealing between or among the Parties. 
I ACKNOWLEDGE THAT I HAVE CAREFULLY READ THE FOREGOING AGREEMENT, THAT I UNDERSTAND ALL OF ITS TERMS AND THAT I AM RELEASING CLAIMS AND THAT I AM ENTERING INTO IT VOLUNTARILY. 
	
			
	AGREED:
	 
	 

	 
	 
	 

	 
	 
	 

	/s/ Ryan C. London
	 
	August 31, 2015

	RYAN C. LONDON
	 
	DATE

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

[NOTARY]

	
				
	MATADOR RESOURCES COMPANY
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 

	/s/ David E. Lancaster
	 
	 

	By:
	David E. Lancaster
	 
	 

	Name:
	Executive Vice President
	 
	 

	 
	 
	 
	 

	Date:
	August 31, 2015
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 

[NOTARY]

6

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