Document:

Purchase and Sale Agreement (Montana and North Dakota Subject Leases)

 Exhibit 10.19 
 PURCHASE AND SALE AGREEMENT 
 (Montana and North Dakota Subject Leases)

 This PURCHASE and SALE AGREEMENT (the “Agreement”) is made this 13th day of January, 2011, by and between
Retamco Operating, Inc., a Texas corporation (“ROI”), and GMX Resources, Inc., an Oklahoma corporation (“GMXR”). GMXR and ROI may be collectively referred to herein as the “Parties” and individually
as a “Party.” 
 RECITALS 
 ROI is the owner of 100% of the working interest in and to the oil and gas leases and properties described on Exhibit A attached hereto (the “Subject Leases”) located in Richland
and Wibaux Counties, Montana and Billings, Dunn, Sheridan and Stark Counties, North Dakota; 
 Subject to the terms hereinafter
set forth, ROI desires to sell to GMXR the Subject Leases, together with certain property relating thereto, which properties comprise the “Subject Interest,” as defined below; and 

GMXR desires to buy and acquire from ROI the Subject Interest, subject to the terms hereinafter set forth. 

In consideration of their mutual promises and of other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties agree as follows: 
 AGREEMENT 

 

	1.	Subject Interest: Subject to the reservations and exceptions provided herein, at Closing (hereafter defined), ROI shall convey, assign and transfer to GMXR the
following property (collectively, the “Subject Interest”): 

  

	 	a.	100% working interest and 80% net revenue interest in the Subject Leases; 

  

	 	b.	All rights and interests in or derived from pooling, communitization or unitization agreements, and orders, declarations, and decisions of state and federal regulatory
authorities, establishing units covering the Subject Leases or any portion thereof (the “Units”); 

  

	 	c.	 All personal property and equipment, rights-of-way, licenses, permits, easements, road use agreements, surface fees, servitudes, franchises, contracts,
agreements and other rights, privileges and benefits (including all rights to participate in seismic surveys pertaining to the Subject Leases) acquired or used in connection with operations for the exploration and production of oil, gas or other
minerals from, or otherwise relating to, the Subject Leases or Units; and Originals (or copies of any copies) of all of ROI’s files, records and data relating to the properties described above, including, without limitation, all lease and land
files, 

	 	 
title records (including title curative documents), surveys, maps and drawings, correspondence, and all geological and geophysical records, including seismic data (“Records”).

  

	2.	Purchase Price; Escrow Matters. The consideration to be paid at Closing by GMXR to ROI for the Subject Interest shall be (i) 2,669,513 shares of common
stock of GMXR, par value $0.001 per share, of GMXR (the “Common Stock”) and (ii) $1,779,675.00 in cash (to be applied from the Cash Deposit); provided, ROI may give written notice to GMXR on or prior to the date two business
days prior to the Closing Date of its election to (i) decrease the Common Stock consideration by 400,542 shares of Common Stock to 2,268,971 shares of Common Stock and (ii) to increase the cash portion of the consideration by $2,403,252.00
(to be released from separate escrow) to $4,182,927.00 (with the number of shares of Common Stock to be issued as consideration (the “Stock Consideration”) pursuant to this Agreement, together with the applicable cash amount (the
“Cash Consideration”), the “Purchase Price”), subject only to any applicable Purchase Price adjustments as provided herein. Contemporaneously with the execution of this Agreement, GMXR and ROI shall enter into an
escrow agreement, substantially in the form attached as Exhibit B hereto (the “Escrow Agreement”), with Capital One, N.A., as escrow agent (the “Escrow Agent”), establishing an escrow account (the
“Escrow Account”). Within one (1) business day after execution and delivery of this Agreement, GMXR shall deposit into the Escrow Account, by wire transfer of cash in immediately available funds, an amount equal to
$1,779,675.00 (the “Cash Deposit”). The Cash Deposit, together with any earnings thereon, shall be either (i) applied to the Purchase Price at Closing, (ii) retained as liquidated damages by ROI if GMXR, in breach of this
Agreement, fails or refuses to close the transactions contemplated hereby, or (iii) refunded to GMXR if the transactions contemplated herein fail to close in accordance with this Agreement, other than due to GMXR’s breach of this
Agreement. 

  

	3.	Conveyance Effective Date. The conveyances of the Subject Interests shall be made from ROI to GMXR on the Closing Date but shall be effective as of
January 1, 2011 at 7:00 a.m., local time where the Subject Interest is located, hereinafter called the “Effective Date.” 

  

	4.	Closing. The closing of the transactions contemplated herein (the “Closing”) shall occur on a date mutually agreed upon by the Parties on or
before February 28, 2011. The date on which Closing actually occurs is referred to herein as the “Closing Date.” The Closing shall take place in the offices of ROI in Red Lodge, Montana at a time mutually agreed upon by the
Parties. At Closing, the following shall occur, each being a condition precedent to the others and each being deemed to have occurred simultaneously with the others: 

 

	 	a.	GMXR will deliver a certificate representing the Stock Consideration; 

  

	 	b.	GMXR will direct the Escrow Agent to disburse to ROI the Cash Deposit and any other applicable cash from escrow, and pay to ROI any additional amount if necessary, in
an amount equal to the applicable Cash Consideration; 

  
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	 	c.	ROI shall execute and deliver to GMXR an Assignment and Bill of Sale in the form of Exhibit C attached hereto, in sufficient counterparts to facilitate
recording; 

  

	 	d.	ROI shall deliver executed separate governmental form assignments of the Subject Interest on officially approved forms, in sufficient counterparts to satisfy applicable
statutory and regulatory requirements; 

  

	 	e.	ROI shall execute and deliver to GMXR a non-foreign certificate, substantially in the form of Exhibit D attached hereto; 

 

	 	f.	ROI shall deliver the Records to GMXR; 

  

	 	g.	The Parties will execute and deliver an executed Registration Rights Agreement in substantially the form of Exhibit H attached hereto; and

  

	 	h.	ROI and GMXR shall execute, acknowledge and deliver such other instruments and take such other action as may be necessary to carry out their obligations under this
Agreement. 

  

	5.	Conditions Precedent to ROI’s Obligation to Close. ROI shall be obligated to consummate the sale of the Subject Interest as contemplated by this Agreement
on the Closing Date, provided the following conditions precedent have been satisfied or have been waived in writing by ROI: 

  

	 	a.	All representations and warranties of GMXR contained in this Agreement shall be true and correct in all material respects, and GMXR shall have complied in all material
respects with all covenants contained in this Agreement to be performed or complied with by GMXR on or prior to the Closing; and 

  

	 	b.	No suit, action or other proceedings shall be pending before any court or governmental entity in which it is sought by a person or entity other than the Parties hereto
or any of their affiliates, officers, directors, or employees to restrain, enjoin or otherwise prohibit the consummation of the transactions contemplated by this Agreement, or to obtain damages in connection with the transactions contemplated
herein. 

  

	6.	Conditions Precedent to GMXR’s Obligation to Close. GMXR shall be obligated to consummate the purchase of the Subject Interest as contemplated by this
Agreement on the Closing Date, provided the following conditions precedent have been satisfied or have been waived in writing by GMXR: 

  

	 	a.	All representations and warranties of ROI contained in this Agreement shall be true and correct in all material respects, and ROI shall have complied in all material
respects with all covenants contained in this Agreement to be performed or complied with by ROI on or prior to the Closing; 

  
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	 	b.	No suit, action or other proceedings shall be pending before any court or governmental entity in which it is sought by a person or entity other than the Parties hereto
or any of their affiliates, officers, directors, or employees to restrain, enjoin or otherwise prohibit the consummation of the transactions contemplated by this Agreement, or to obtain damages in connection with the transactions contemplated
herein, and GMXR shall have received applicable approvals from the New York Stock Exchange (the “NYSE”) relating to the issuance of the Stock Consideration; and 

 

	 	c.	The aggregate sum of downward adjustments to the Purchase Price for Title Defects (including adjustments arising from the failure to obtain required consents) shall not
exceed twenty percent (20%) of the Purchase Price. 

  

	7.	Termination of Agreement. 

  

	 	a.	This Agreement and the transactions contemplated hereby may be terminated in the following instances: 

 

	 	i.	By ROI if any of the conditions set forth in Section 5.a are not satisfied in all material respects or waived as of the Closing Date; provided that ROI is not in
material breach of this Agreement; 

  

	 	ii.	By GMXR if any of the conditions set forth in Section 6.a are not satisfied in all material respects or waived as of the Closing Date; provided that GMXR is not in
material breach of this Agreement; or 

  

	 	iii.	At any time by the mutual written agreement of GMXR and ROI. 

  

	 	b.	If ROI terminates this Agreement in accordance with Section 7a.i due to GMXR’s breach of its representations, warranties or covenants herein, ROI shall
receive the Cash Deposit, together with all earnings thereon, as liquidated damages, not as penalty, as its sole and exclusive remedy. If this Agreement is terminated for any other reason, then the Cash Deposit, together with earnings thereon, shall
be returned to GMXR. If GMXR terminates this Agreement in accordance with Section 7a.ii due to ROI’s breach of this Agreement, then, in addition to the return of the Cash Deposit, GMXR may seek damages, but not injunction, specific
performance or any remedy impairing ROI’s right or ability to transfer of assign the Subject Interest. 

  

	8.	 Files and Records; Diligence. After the execution of this Agreement and prior to Closing, ROI shall allow GMXR and its attorneys, employees and
consultants to examine, at ROI’s offices, all of ROI’s land, contract, and other files and records which relate to the Subject Interest. In this connection, ROI shall make available to GMXR for examination such title information with
respect to the Subject Interest which is in ROI’s files or to which ROI has access. However, ROI shall have no obligations to update any title information currently in ROI’s files. In addition, ROI shall make available to GMXR and its
attorneys, employees and consultants, upon reasonable notice during normal business hours, such officers and employees of ROI who are knowledgeable with respect to the 

  
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Subject Interests in order that GMXR may make, at GMXR’s sole cost and expense, such due diligence investigation as to title and environmental matters as GMXR considers necessary or
appropriate. Further, ROI shall grant to GMXR and its attorneys, employees and consultants access to the Subject Leases and other Subject Interests in order for GMXR to conduct, at GMXR’s sole cost and expense, a physical inspection of the
Subject Interest. GMXR shall release, indemnify, and defend and hold harmless ROI from and against any and all claims, demands, causes of action, damages, liabilities, payments, charges, costs and expenses of any kind or character arising from
GMXR’s inspection of the Subject Interest, including, without limitation, claims for personal injuries to or death of any person or damage to the Subject Interest or the property of any person arising from such inspection.

  

	9.	Title Defects. 

  

	 	a.	GMXR shall, at its sole expense, conduct such examinations of title and data as it sees fit and shall notify ROI, in writing, on or before February 28, 2011 (the
“Defect Notice Deadline”) of any Title Defects, as defined below, with respect to the Subject Interest. Without waiving any of its rights under Section 10 herein or under the special warranty of title in the Assignment and Bill
of Sale delivered at Closing, GMXR will be deemed to have waived any Title Defects as to which GMXR has not given ROI written notice on or before the Defect Notice Deadline. “Title Defect” means a defect in or failure of ROI’s
ownership of any of the Subject Interests that causes ROI to not have Marketable Title to such Subject Interest. “Marketable Title” means a title that can be deduced from the applicable county, state and federal records and is such that:
(a) a reasonable and prudent person engaged in the business of the ownership, development and operation of oil and gas properties with the knowledge of all the facts and their legal bearing would be willing to accept title to the property;
(b) such title will entitle GMXR to receive a net revenue interest in the Subject Leases entitling it to not less than 80% of 8/8ths of all hydrocarbons produced, saved and marketed from the Subject Leases; (c) the net mineral acres
covered by each of the Subject Leases are not less than that set forth in Exhibit A with respect to each such lease; and (d) such title is free and clear from all liens and encumbrances, other than such liens and encumbrances that
(i) are of the nature customarily accepted by prudent purchasers of oil and gas properties; (ii) do not materially affect the value of any property encumbered thereby or materially impair the ability to use any such property in oil and gas
operations; and (iii) do not operate to reduce the net revenue interest to be delivered to GMXR below 80% of 8/8ths. 

  

	 	b.	 In the event GMXR notifies ROI of such Title Defects, ROI may, at its option, attempt to cure any and all such Title Defects. Prior to the Closing
Date, ROI shall notify GMXR of whether it has cured, or expects to cure, any Title Defects identified by GMXR. In the event of a Title Defect which renders title to all or a portion of the Subject Interest to not be Marketable Title and ROI does not
cure the same, the Parties shall adjust the Purchase Price by deducting $1,000.00 per net mineral acre affected by the Title Defect. For purposes of any such adjustment to the Purchase Price, as well as and together with any adjustment

  
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under Section 9c. below, the adjustment shall first be applied to reduce the Cash Consideration payable, and thereafter, shall be applied to the Stock Consideration to reduce the Stock
Consideration by a number of shares of Common Stock equal to such reduced Purchase Price divided by six (6). 

  

	 	c.	Consents. Except with respect to governmental consents customarily obtained post-Closing, as soon as practicable after execution of this Agreement, ROI shall
send requests to the holders of required consents to assignment for their consent to assignment of the affected Subject Interest to GMXR. The form and content of all solicitations for such consents shall be agreed upon by GMXR and ROI. In the event
a required consent is not obtained prior to Closing, then, unless the failure to obtain such consent is waived by GMXR, the affected property will be excluded from the Subject Interests delivered at Closing, and the Purchase Price excluded from the
Subject Interests delivered at Closing, and the Purchase Price will be adjusted downward by an amount equal to $1,000.00 per net mineral acre, multiplied by the number of net mineral acres attributable to the affected property.

  

	10.	Warranty. ROI shall convey to GMXR at Closing title to the Subject Interest free and clear of all liens and encumbrances created by, through or under ROI. In
addition, GMXR shall have full rights of substitution and subrogation to all warranties and covenants heretofore given by others with respect to the Subject Leases or any part thereof. 

 

	11.	Indemnification. 

  

	 	a.	GMXR shall protect, defend, indemnify and hold ROI harmless from all claims, demands, causes of action, damages, taxes, penalties, fines, judgments, costs, expenses and
liabilities, direct, contingent or otherwise (“Claims”), arising from or relating to the ownership of the Subject Interest during the period of time from and after the Effective Date. 

 

	 	b.	ROI shall protect, defend, indemnify and hold GMXR harmless from all Claims arising from or relating to the ownership of the Subject Interest during the period of time
prior to the Effective Date. 

  

	12.	Representations and Warranties of ROI. ROI represents and warrants to GMXR that, as of the date hereof and as of the Closing Date: 

 

	 	a.	Binding Obligation. This Agreement and all other transaction documents it is to execute and deliver at Closing (i) have been duly authorized by all
necessary corporate action pursuant to ROI’s articles of incorporation, bylaws, and other governing documents; (ii) have been duly executed by ROI or its authorized representatives, and (iii) constitute the legal, valid and binding
obligation of ROI, enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to the enforcement of creditor’s rights. 

  
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	 	b.	Authority. ROI is duly organized and in good standing under the laws of its state of formation, is duly qualified to carry on its business in the State of
Wyoming, and has all the requisite power and authority to enter into and perform this Agreement. ROI owns the Subject Interest and has the full power and right to sell and convey the same. 

 

	 	c.	No Violation of Restrictions. The execution, delivery, and performance of this Agreement does not conflict with or violate any agreement or instrument to which
ROI is a party or by which it is bound or any law, rule, regulation, ordinance, judgment, decree, or order to which ROI is subject or by which any of the Subject Interests are bound. 

 

	 	d.	Liens. The Subject Interest is free and clear of any liens, mortgages, security interests or other similar encumbrances arising by, through or under ROI, except
for those which shall be released of record prior to the Closing Date. 

  

	 	e.	Rents and Royalties. All rentals, royalties, overriding royalties and other burdens based upon or measured by the ownership of the Subject Interest or the
production of hydrocarbons therefrom that are due and owing have been fully and timely paid. Exhibit E sets forth a complete and accurate schedule of due dates for rental payments due under for all federal and state Subject Leases.

  

	 	f.	Litigation and Claims. There is no claim (including claims for taxes), demand, cause of action, litigation or other proceeding threatened or pending against ROI
relating to the Subject Interest. 

  

	 	g.	Preferential Rights to Purchase. None of the Subject Interests is subject to any preferential right or option to purchase in favor of any third party.

  

	 	h.	Consents. Except as set forth on Exhibit F, no consent or approval of any third party is necessary for the assignment of any of the Subject Interests,
except for governmental consents customarily obtained post-Closing. 

  

	 	i.	Broker’s Fees & Commissions. ROI has not incurred any obligation or liability, contingent or otherwise, for broker or finder fees with respect to
the matters provided for in this Agreement which will be the responsibility of GMXR. 

  

	 	j.	Bankruptcy. There are no bankruptcy, reorganization, or receivership proceedings pending, or to ROI”s knowledge, threatened against it.

  

	 	k.	Contract Obligations. Exhibit G identifies all contracts comprising or burdening the Subject Interest. ROI is not, nor to ROI’s knowledge is any
third party, in default in any material respect under any such contract. 

  

	 	l.	Taxes. All federal, state and local ad valorem, property, production, severance and similar taxes that are due and owing with respect to the Subject Interest
have been paid in full, and the respective tax return filings have been made. 

  
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	 	m.	Leases. ROI is not in breach or default with respect to any obligation under any of the Subject Leases. Each of the Subject Leases is valid and existing, in full
force and effect, enforceable in accordance with its terms and has not terminated or expired as to any interest covered thereby, in whole or in part. Except for customary “Pugh” clauses contained in the Subject Leases, there are no
contractual obligations under the Subject Leases or otherwise that require the drilling of wells or other material development operations in order to earn or continue to hold all or any portion of the Subject Leases. 

 

	 	n.	FIRPTA; Tax Withholding. ROI is not a “foreign person” within the meaning of Section 1445 if the Internal Revenue Code and is formed under the
laws of a state of the United States and is authorized and otherwise duly qualified to hold real property and interests therein. 

  

	 	o.	Accredited Investor. ROI is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as
amended (the “Securities Act”). ROI understands that GMXR will rely upon the exemptions provided by the Securities Act, Regulation D thereunder and various state securities laws and will rely on the representations and warranties of
ROI contained herein for purposes of such determination. ROI is acquiring Common Stock for its own account and not with a view to, or for the offer or sale in connection with, any distribution thereof. ROI acknowledges that the shares of Common
Stock have not been registered under the Securities Act, or any state securities laws, that the shares of Common Stock may not be transferred or sold except pursuant to a registration statement filed in accordance with the Securities Act or pursuant
to any applicable exemption therefrom under the Securities Act and state securities laws, and that the certificate representing the Purchase Price will bear a restricted legend to the same effect. 

 

	 	p.	Sophisticated Investor. ROI has such knowledge of GMXR and its business and such experience in financial and business matters to enable it to evaluate the merits
and risks of an investment in Common Stock. ROI has made an informed investment decision with respect to the shares of Common Stock to be acquired pursuant to this Agreement. ROI understands that there can be no assurance as to the federal or state
tax result of an investment in Common Stock. ROI understands that no state or federal governmental authority has made any finding or determination relating to the fairness of an investment in Common Stock and no state or federal governmental
authority has recommended or endorsed or will recommend or endorse an investment in Common Stock. ROI is able to bear the risks of an investment in the Common Stock, including the risks set forth in GMXR’s risk factors included in Item 1A
of its most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. 

  
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	13.	Representations and Warranties of GMXR. GMXR represents and warrants to ROI that, as of the date hereof and as of the Closing Date: 

 

	 	a.	Binding Obligation. This Agreement and all other transaction documents it is to execute and deliver at Closing (i) have been duly authorized by all
necessary corporate action pursuant to GMXR’s articles of incorporation, bylaws, and other governing documents; (ii) have been duly executed by GMXR or its authorized representatives, and (iii) constitute the legal, valid and binding
obligation of GMXR enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to the enforcement of creditor’s rights. 

 

	 	b.	Authority. GMXR is duly organized and in good standing under the laws of its state of formation, is, or prior to Closing will be, duly qualified to carry on its
business in the State of Wyoming, and has all the requisite power and authority to enter into and perform this Agreement. GMXR has, or prior to Closing will have, the full power and right to acquire and operate the Subject Interest.

  

	 	c.	No Violation of Restrictions. The execution, delivery, and performance of this Agreement does not conflict with or violate any agreement or instrument to which
GMXR is a party or by which it is bound or any law, rule, regulation, ordinance, judgment, decree, or order to which GMXR is subject. 

  

	 	d.	Broker’s Fees & Commissions. GMXR has not incurred any obligation or liability, contingent or otherwise, for broker or finder fees with respect to
the matters provided for in this Agreement which will be the responsibility of ROI. 

  

	 	e.	Bankruptcy. There are no bankruptcy, reorganization, or receivership proceedings pending, or to GMXR’s knowledge, threatened against it.

  

	 	f.	Capitalization. The authorized capital stock of GMXR consists of 100,000,000 shares of Common Stock, and 10,000,000 shares of preferred stock, par value $.001
per share, of which 6,000,000 shares are designated Series B Cumulative Preferred Stock, and 25,000 are designated Series A Junior Participating Preferred Stock, par value $.001 per share. As of January 11, 2011, there were issued and
outstanding 31,283,353 shares of Common Stock, 2,041,169 shares of Series B Cumulative Preferred Stock and no shares of Series A Junior Participating Preferred Stock. The issued and outstanding shares of Common Stock and Series B Cumulative
Preferred Stock have been duly authorized and validly issued and are fully paid and non-assessable and were not issued in violation of any preemptive, preferential purchase or other similar rights of any person. 

 

	 	g.	Upon delivery of the shares of Common Stock as the Purchase Price to ROI as provided in this Agreement, ROI will acquire good and valid title thereto, and such shares
of Common Stock will be validly issued, fully paid and non-assessable. 

  
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	 	h.	No consent, approval, waiver or authorization of any governmental entity or any other person is required for GMXR to execute and deliver this Agreement or to perform
its obligations hereunder, other than the approval by the NYSE of a supplemental listing application with respect to the Stock Consideration. 

  

	14.	Breach of Representations and Warranties. If, on or before Closing, a Party is in default under any of its representations and warranties hereunder, the
defaulting Party shall use reasonable efforts to cure the same before Closing, but if it is unable to do so, then the Parties shall attempt to agree upon an adjustment to the Purchase Price due to such default. If the Parties are unable to agree as
to such adjustment on or before Closing, then the Party not in default may terminate this Agreement by giving written notice to the other on or before the Closing Date, as provided in Section 7 hereof. 

 

	15.	Preservation of Rights and Interest. ROI agrees to preserve and maintain the Subject Leases in full force and effect as to all lands covered thereby pending the
Closing of the transaction. ROI shall maintain the Subject Interest in a reasonable, prudent, businesslike manner pending the Closing, and shall take no action to encumber the Subject Interest or which would hinder or decrease the value of the
Subject Interest between the date this Agreement is signed and Closing. 

  

	16.	Confidentiality. 

  

	 	a.	Neither Party may make press releases or other public announcements concerning this transaction without the other’s prior written approval, except as may be
required by applicable laws or rules and regulation of any governmental agency or stock exchange. 

  

	 	b.	If the Closing does not occur, GMXR will keep all the information furnished by ROI to GMXR hereunder strictly confidential and will not use any of such information to
GMXR’s advantage or in competition with ROI; provided, however, that such restriction shall not apply to (i) information that is already known to GMXR as of the date hereof; (ii) information that is already publicly available or
becomes publicly available, other than through the act or omission of GMXR; (iii) information that is, upon advice of counsel, required to be disclosed under applicable law, legal process or by a governmental order, decree, regulation or rule
(provided that GMXR shall give written notice to ROI as soon as possible prior to such disclosure so that ROI may seek to obtain a protective order or other appropriate relief); or (iv) information that is acquired independently from a third
party that has the right to disseminate such information at the time it is acquired by GMXR. 

  
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	17.	[RESERVED]. 

  

	18.	Notices. All notices shall be in writing and shall be deemed sufficiently given with receipt obtained, when hand delivered, or sent by overnight courier,
certified mail, email transmission or telefax to the appropriate address as set forth below. Notices to the Parties shall be addressed as follows: 

  

			
	 ROI:
  
	 	 GMXR:
  

	Retamco Operating, Inc.	 	GMX Resources, Inc.
	One South Broadway Ave.	 	One Benham Place, Suite 600
	Suite 2	 	9400 North Broadway
	Red Lodge, MT 59068	 	Oklahoma City, OK 73114
	Attention: Steve Gose	 	Attention: Gary D. Jackson
	Telephone: (210) 225-4031	 	Telephone: (405) 600-0711
	Fax: (210) 222-0586	 	Fax: (405) 600-0600
	E-mail: stevegose@retamco.com	 	E-mail: gjackson@GMXRresources.com

  

			
	 With copies to:
  
	  	 With copies to:

 

	Drought Drought & Bobbitt, LLP	  	Andrews Kurth LLP
	112 E. Pecan Street, Suite 2900	  	600 Travis, Suite 4200
	San Antonio, TX 78205	  	Houston, TX 77002
	Attention: James L. Drought	  	Attention: David C. Buck
	& Calhoun Bobbitt	  	Telephone: (713) 220-4200
	Telephone: (210) 225-4031	  	Fax: (713) 220-4285
	Fax: (210) 222-0586	  	Email: dbuck@andrewskurth.com
	Email: jld@ddb-law.com	  	

  

	19.	Further Assurances. After the Closing, the parties agree to execute such further documents, deliver such further instruments or take such other actions as may be
reasonably requested in order to effectuate the transactions contemplated hereunder and to more effectively assure to each Party all of the respective properties, rights, titles, interests, estates, remedies, powers and privileges intended to be
assigned and delivered in consummation of the transactions contemplated hereby. 

  

	20.	Survival. The terms and conditions of this Agreement shall survive the Closing of the transactions contemplated hereby. 

 

	21.	Time of Essence. Time is expressly declared to be of the essence in this Agreement. 

 

	22.	Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns, and nothing contained
in this Agreement, express or implied, is intended to confer upon any other person or entity any benefits, rights or remedies. 

  
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	23.	Governing Law. The laws of the State of Texas shall govern the interpretation of construction of this Agreement, excluding any conflicts-of-law rule or principle
that might apply the law of another jurisdiction. 

  

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

  

	25.	Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced under any rule of law, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in a materially adverse manner with respect to any Party.

  

	26.	Counterparts. This Agreement may be executed by ROI and GMXR in counterparts, each of which shall be deemed to be an original and all of which shall be deemed to
constitute one Agreement. 

  

	27.	Entire Agreement. This Agreement constitutes the entire agreement between the Parties, supercedes all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the Parties. No supplement, amendment, alteration, modification or waiver of this Agreement shall be binding unless executed in writing by the Parties hereto. 

[Signature Page Follows] 

  
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 Executed this 13th day of January, 2011. 

 

			
	Retamco Operating, Inc.
		
	By:	 	       /s/ Steve Gose

		 	      Steve Gose, President
	
	GMX Resources Inc.
		
	By:	 	       /s/ Ken Kenworthy

		 	      Ken Kenworthy, CEO

  
 13Purchase and Sale Agreement (Wyoming Subject Leases)

 Exhibit 10.20 
 PURCHASE AND SALE AGREEMENT 
 (Wyoming Subject Leases) 

This PURCHASE and SALE AGREEMENT (the “Agreement”) is made this 13th day of January, 2011, by and between Retamco
Operating, Inc., a Texas corporation (“ROI”), and GMX Resources, Inc., an Oklahoma corporation (“GMXR”). GMXR and ROI may be collectively referred to herein as the “Parties” and individually as a
“Party.” 
 RECITALS 
 ROI is the owner of 100% of the working interest in and to the oil and gas leases and properties described on Exhibit A attached hereto (the “Subject Leases”) located in Goshen and
Platte Counties, Wyoming; 
 Subject to the terms hereinafter set forth, ROI desires to sell to GMXR the Subject Leases,
together with certain property relating thereto, which properties comprise the “Subject Interest,” as defined below; and 
 GMXR desires to buy and acquire from ROI the Subject Interest, subject to the terms hereinafter set forth. 
 In consideration of their mutual promises and of other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows: 

AGREEMENT 
  

	1.	Subject Interest: Subject to the reservations and exceptions provided herein, at Closing (hereafter defined), ROI shall convey, assign and transfer to GMXR the
following property (collectively, the “Subject Interest”): 

  

	 	a.	100% working interest and 80% net revenue interest in the Subject Leases; 

  

	 	b.	All rights and interests in or derived from pooling, communitization or unitization agreements, and orders, declarations, and decisions of state and federal regulatory
authorities, establishing units covering the Subject Leases or any portion thereof (the “Units”); 

  

	 	c.	All personal property and equipment, rights-of-way, licenses, permits, easements, road use agreements, surface fees, servitudes, franchises, contracts, agreements and
other rights, privileges and benefits (including all rights to participate in seismic surveys pertaining to the Subject Leases) acquired or used in connection with operations for the exploration and production of oil, gas or other minerals from, or
otherwise relating to, the Subject Leases or Units; and 

	 	d.	Originals (or copies of any copies) of all of ROI’s files, records and data relating to the properties described above, including, without limitation, all lease
and land files, title records (including title curative documents), surveys, maps and drawings, correspondence, and all geological and geophysical records, including seismic data (“Records”). 

 

	2.	Purchase Price; Escrow Matters. The purchase price to be paid at Closing by GMXR to ROI for the Subject Interest shall be $24,032,565.00 (the “Purchase
Price”), subject only to any applicable Purchase Price adjustments as provided herein. Contemporaneously with the execution of this Agreement, GMXR and ROI shall enter into an escrow agreement, substantially in the form attached as
Exhibit B hereto (the “Escrow Agreement”), with Capital One, N.A., as escrow agent (the “Escrow Agent”), establishing an escrow account (the “Escrow Account”). Within one
(1) business day after execution and delivery of this Agreement, GMXR shall deposit into the Escrow Account, by wire transfer of immediately available funds, an amount equal to $2,403,256.50 (10% of the Purchase Price) (the “Cash
Deposit”), which, together with any earnings thereon, shall be (i) applied to the Purchase Price at Closing, (ii) retained as liquidated damages by ROI if GMXR, in breach of this Agreement, fails or refuses to close the
transactions contemplated hereby, (iii) refunded to GMXR if the transactions contemplated herein fail to close, other than due to GMXR’s breach of this Agreement, or (iv) at the option of ROI, as set forth in a Purchase and Sale
Agreement (Montana and North Dakota Subject Leases) between the Parties, dated as of January 13, 2011 (the “MT-ND PSA”), applied to pay a portion of the purchase price payable for the assets under the MT-ND PSA at a closing
expected to occur on or before February 28, 2011. 

  

	3.	Conveyance Effective Date. The conveyances of the Subject Interests shall be made from ROI to GMXR on the Closing Date but shall be effective as of
January 1, 2011 at 7:00 a.m., local time where the Subject Interest is located, hereinafter called the “Effective Date.” 

  

	4.	Closing. The closing of the transactions contemplated herein (the “Closing”) shall occur on a date mutually agreed upon by the Parties on or
before April 30, 2011. The date on which Closing actually occurs is referred to herein as the “Closing Date.” The Closing shall take place in the offices of ROI in Red Lodge, Montana at a time mutually agreed upon by the
Parties. At Closing, the following shall occur, each being a condition precedent to the others and each being deemed to have occurred simultaneously with the others: 

 

	 	a.	GMXR will pay the Purchase Price, less the amount of the Cash Deposit and any earnings thereon applied under Section 4b below, to ROI by wire transfer of
immediately available funds to an account designated by ROI in writing at least two (2) business days prior to Closing; 

  

	 	b.	GMXR will direct the Escrow Agent to disburse the Cash Deposit, together with any earnings thereon, available as of the Closing Date, to ROI; 

  
 2 

	 	c.	ROI shall execute and deliver to GMXR an Assignment and Bill of Sale in the form of Exhibit C attached hereto, in sufficient counterparts to facilitate
recording; 

  

	 	d.	ROI shall deliver executed separate governmental form assignments of the Subject Interest on officially approved forms, in sufficient counterparts to satisfy applicable
statutory and regulatory requirements; 

  

	 	e.	ROI shall execute and deliver to GMXR a non-foreign certificate, substantially in the form of Exhibit D attached hereto; 

 

	 	f.	ROI shall deliver the Records to GMXR; and 

  

	 	g.	ROI and GMXR shall execute, acknowledge and deliver such other instruments and take such other action as may be necessary to carry out their obligations under this
Agreement. 

  

	5.	Conditions Precedent to ROI’s Obligation to Close. ROI shall be obligated to consummate the sale of the Subject Interest as contemplated by this Agreement
on the Closing Date, provided the following conditions precedent have been satisfied or have been waived in writing by ROI: 

  

	 	a.	All representations and warranties of GMXR contained in this Agreement shall be true and correct in all material respects, and GMXR shall have complied in all material
respects with all covenants contained in this Agreement to be performed or complied with by GMXR on or prior to the Closing; and 

  

	 	b.	No suit, action or other proceedings shall be pending before any court or governmental entity in which it is sought by a person or entity other than the Parties hereto
or any of their affiliates, officers, directors, or employees to restrain, enjoin or otherwise prohibit the consummation of the transactions contemplated by this Agreement, or to obtain damages in connection with the transactions contemplated
herein. 

  

	6.	Conditions Precedent to GMXR’s Obligation to Close. GMXR shall be obligated to consummate the purchase of the Subject Interest as contemplated by this
Agreement on the Closing Date, provided the following conditions precedent have been satisfied or have been waived in writing by GMXR: 

  

	 	a.	All representations and warranties of ROI contained in this Agreement shall be true and correct in all material respects, and ROI shall have complied in all material
respects with all covenants contained in this Agreement to be performed or complied with by ROI on or prior to the Closing; 

  

	 	b.	No suit, action or other proceedings shall be pending before any court or governmental entity in which it is sought by a person or entity other than the Parties hereto
or any of their affiliates, officers, directors, or employees to restrain, enjoin or otherwise prohibit the consummation of the transactions contemplated by this Agreement, or to obtain damages in connection with the transactions contemplated
herein; and 

  
 3 

	 	c.	The aggregate sum of downward adjustments to the Purchase Price for Title Defects (including adjustments arising from the failure to obtain required consents) shall not
exceed twenty percent (20%) of the Purchase Price. 

  

	7.	Termination of Agreement. 

  

	 	a.	This Agreement and the transactions contemplated hereby may be terminated in the following instances: 

 

	 	i.	By ROI if any of the conditions set forth in Section 5.a are not satisfied in all material respects or waived as of the Closing Date; provided that ROI is not in
material breach of this Agreement; 

  

	 	ii.	By GMXR if any of the conditions set forth in Section 6.a are not satisfied in all material respects or waived as of the Closing Date; provided that GMXR is not in
material breach of this Agreement; or 

  

	 	iii.	At any time by the mutual written agreement of GMXR and ROI. 

  

	 	b.	If ROI terminates this Agreement in accordance with Section 7a.i due to GMXR’s breach of its representations, warranties or covenants herein, ROI shall
receive the Cash Deposit, together with all earnings thereon, as liquidated damages, not as penalty, as its sole and exclusive remedy. If this Agreement is terminated for any other reason, then the Cash Deposit, together with earnings thereon, shall
be returned to GMXR. If GMXR terminates this Agreement in accordance with Section 7a.ii due to ROI’s breach of this Agreement, then, in addition to the return of the Cash Deposit, GMXR may seek damages, but not injunction, specific
performance or any remedy impairing ROI’s right or ability to transfer or assign the Subject Interest. 

  

	8.	 Files and Records; Diligence. After the execution of this Agreement and prior to Closing, ROI shall allow GMXR and its attorneys, employees and
consultants to examine, at ROI’s offices, all of ROI’s land, contract, and other files and records which relate to the Subject Interest. In this connection, ROI shall make available to GMXR for examination such title information with
respect to the Subject Interest which is in ROI’s files or to which ROI has access. However, ROI shall have no obligations to update any title information currently in ROI’s files. In addition, ROI shall make available to GMXR and its
attorneys, employees and consultants, upon reasonable notice during normal business hours, such officers and employees of ROI who are knowledgeable with respect to the Subject Interests in order that GMXR may make, at GMXR’s sole cost and
expense, such due diligence investigation as to title and environmental matters as GMXR considers necessary or appropriate. Further, ROI shall grant to GMXR and its attorneys, employees and consultants access to the Subject Leases and other Subject
Interests in order for GMXR to conduct, at GMXR’s sole cost and expense, a physical inspection of the Subject Interest. GMXR shall release, indemnify, and defend and hold harmless ROI

  
 4 

	 	 
from and against any and all claims, demands, causes of action, damages, liabilities, payments, charges, costs and expenses of any kind or character arising from GMXR’s inspection of the
Subject Interest, including, without limitation, claims for personal injuries to or death of any person or damage to the Subject Interest or the property of any person arising from such inspection. 

 

	9.	Title Defects. 

  

	 	a.	GMXR shall, at its sole expense, conduct such examinations of title and data as it sees fit and shall notify ROI, in writing, on or before February 28, 2011 (the
“Defect Notice Deadline”) of any Title Defects, as defined below, with respect to the Subject Interest. Without waiving any of its rights under Section 10 herein or under the special warranty of title in the Assignment and Bill
of Sale delivered at Closing, GMXR will be deemed to have waived any Title Defects as to which GMXR has not given ROI written notice on or before the Defect Notice Deadline. “Title Defect” means a defect in or failure of ROI’s
ownership of any of the Subject Interests that causes ROI to not have Marketable Title to such Subject Interest. “Marketable Title” means a title that can be deduced from the applicable county, state and federal records and is such
that: (a) a reasonable and prudent person engaged in the business of the ownership, development and operation of oil and gas properties with the knowledge of all the facts and their legal bearing would be willing to accept title to the
property; (b) such title will entitle GMXR to receive a net revenue interest in the Subject Leases entitling it to not less than 80% of 8/8ths of all hydrocarbons produced, saved and marketed from the Subject Leases; (c) the net mineral
acres covered by each of the Subject Leases are not less than that set forth in Exhibit A with respect to each such lease; and (d) such title is free and clear from all liens and encumbrances, other than such liens and encumbrances that
(i) are of the nature customarily accepted by prudent purchasers of oil and gas properties; (ii) do not materially affect the value of any property encumbered thereby or materially impair the ability to use any such property in oil and gas
operations; and (iii) do not operate to reduce the net revenue interest to be delivered to GMXR below 80% of 8/8ths. 

  

	 	b.	In the event GMXR notifies ROI of such Title Defects, ROI may, at its option, attempt to cure any and all such Title Defects. Prior to the Closing Date, ROI shall
notify GMXR of whether it has cured, or expects to cure, any Title Defects identified by GMXR. In the event of a Title Defect which renders title to all or a portion of the Subject Interest to not be Marketable Title and ROI does not cure the same,
the Parties shall adjust the Purchase Price by deducting $2,450.00 per net mineral acre affected by the Title Defect. 

  

	 	c.	 Consents. Except with respect to governmental consents customarily obtained post-Closing, as soon as practicable after execution of this
Agreement, ROI shall send requests to the holders of required consents to assignment for their consent to assignment of the affected Subject Interest to GMXR. The form and content of all solicitations for such consents shall be agreed upon by GMXR
and ROI. In the event a required consent is not obtained prior to Closing, then, unless the failure 

  
 5 

	 	 
to obtain such consent is waived by GMXR, the affected property will be excluded from the Subject Interests delivered at Closing, and the Purchase Price will be adjusted downward by an amount
equal to $2,450.00 per net mineral acre, multiplied by the number of net mineral acres attributable to the affected property. 

  

	10.	Warranty. ROI shall convey to GMXR at Closing title to the Subject Interest free and clear of all liens and encumbrances created by, through or under ROI. In
addition, GMXR shall have full rights of substitution and subrogation to all warranties and covenants heretofore given by others with respect to the Subject Leases or any part thereof. 

 

	11.	Indemnification. 

  

	 	a.	GMXR shall protect, defend, indemnify and hold ROI harmless from all claims, demands, causes of action, damages, taxes, penalties, fines, judgments, costs, expenses and
liabilities, direct, contingent or otherwise (“Claims”), arising from or relating to the ownership of the Subject Interest during the period of time from and after the Effective Date. 

 

	 	b.	ROI shall protect, defend, indemnify and hold GMXR harmless from all Claims arising from or relating to the ownership of the Subject Interest during the period of time
prior to the Effective Date. 

  

	12.	Representations and Warranties of ROI. ROI represents and warrants to GMXR that, as of the date hereof and as of the Closing Date: 

 

	 	a.	Binding Obligation. This Agreement and all other transaction documents it is to execute and deliver at Closing (i) have been duly authorized by all
necessary corporate action pursuant to ROI’s articles of incorporation, bylaws, and other governing documents; (ii) have been duly executed by ROI or its authorized representatives; and (iii) constitute the legal, valid and binding
obligation of ROI, enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to the enforcement of creditor’s rights. 

 

	 	b.	Authority. ROI is duly organized and in good standing under the laws of its state of formation, is duly qualified to carry on its business in the State of
Wyoming, and has all the requisite power and authority to enter into and perform this Agreement. ROI owns the Subject Interest and has the full power and right to sell and convey the same. 

 

	 	c.	No Violation of Restrictions. The execution, delivery, and performance of this Agreement does not conflict with or violate any agreement or instrument to which
ROI is a party or by which it is bound or any law, rule, regulation, ordinance, judgment, decree, or order to which ROI is subject or by which any of the Subject Interests are bound. 

  
 6 

	 	d.	Liens. The Subject Interest is free and clear of any liens, mortgages, security interests or other similar encumbrances arising by, through or under ROI, except
for those which shall be released of record prior to the Closing Date. 

  

	 	e.	Rents and Royalties. All rentals, royalties, overriding royalties and other burdens based upon or measured by the ownership of the Subject Interest or the
production of hydrocarbons therefrom that are due and owing have been fully and timely paid. Exhibit E sets forth a complete and accurate schedule of due dates for rental payments due under for all federal and state Subject Leases.

  

	 	f.	Litigation and Claims. There is no claim (including claims for taxes), demand, cause of action, litigation or other proceeding threatened or pending against ROI
relating to the Subject Interest. 

  

	 	g.	Preferential Rights to Purchase. None of the Subject Interests is subject to any preferential right or option to purchase in favor of any third party.

  

	 	h.	Consents. Except as set forth on Exhibit F, no consent or approval of any third party is necessary for the assignment of any of the Subject Interests,
except for governmental consents customarily obtained post-Closing. 

  

	 	i.	Broker’s Fees & Commissions. ROI has not incurred any obligation or liability, contingent or otherwise, for broker or finder fees with respect to
the matters provided for in this Agreement which will be the responsibility of GMXR. 

  

	 	j.	Bankruptcy. There are no bankruptcy, reorganization, or receivership proceedings pending, or to ROI”s knowledge, threatened against it.

  

	 	k.	Contract Obligations. Exhibit G identifies all contracts comprising or burdening the Subject Interest. ROI is not, nor to ROI’s knowledge is any
third party, in default in any material respect under any such contract. 

  

	 	l.	Taxes. All federal, state and local ad valorem, property, production, severance and similar taxes that are due and owing with respect to the Subject Interest
have been paid in full, and the respective tax return filings have been made. 

  

	 	m.	Leases. ROI is not in breach or default with respect to any obligation under any of the Subject Leases. Each of the Subject Leases is valid and existing, in full
force and effect, enforceable in accordance with its terms and has not terminated or expired as to any interest covered thereby, in whole or in part. Except for customary “Pugh” clauses contained in the Subject Leases, there are no
contractual obligations under the Subject Leases or otherwise that require the drilling of wells or other material development operations in order to earn or continue to hold all or any portion of the Subject Leases. 

  
 7 

	13.	Representations and Warranties of GMXR. GMXR represents and warrants to ROI that, as of the date hereof and as of the Closing Date: 

 

	 	a.	Binding Obligation. This Agreement and all other transaction documents it is to execute and deliver at Closing (i) have been duly authorized by all
necessary corporate action pursuant to GMXR’s articles of incorporation, bylaws, and other governing documents; (ii) have been duly executed by GMXR or its authorized representatives, and (iii) constitute the legal, valid and binding
obligation of GMXR enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to the enforcement of creditor’s rights. 

 

	 	b.	Authority. GMXR is duly organized and in good standing under the laws of its state of formation, is, or prior to Closing will be, duly qualified to carry on its
business in the State of Wyoming, and has all the requisite power and authority to enter into and perform this Agreement. GMXR has, or prior to Closing will have, the full power and right to acquire and operate the Subject Interest.

  

	 	c.	No Violation of Restrictions. The execution, delivery, and performance of this Agreement does not conflict with or violate any agreement or instrument to which
GMXR is a party or by which it is bound or any law, rule, regulation, ordinance, judgment, decree, or order to which GMXR is subject. 

  

	 	d.	Broker’s Fees & Commissions. GMXR has not incurred any obligation or liability, contingent or otherwise, for broker or finder fees with respect to
the matters provided for in this Agreement which will be the responsibility of ROI. 

  

	 	e.	Bankruptcy. There are no bankruptcy, reorganization, or receivership proceedings pending, or to GMXR’s knowledge, threatened against it.

  

	14.	Breach of Representations and Warranties. If, on or before Closing, a Party is in default under any of its representations and warranties hereunder, the
defaulting Party shall use reasonable efforts to cure the same before Closing, but if it is unable to do so, then the Parties shall attempt to agree upon an adjustment to the Purchase Price due to such default. If the Parties are unable to agree as
to such adjustment on or before Closing, then the Party not in default may terminate this Agreement by giving written notice to the other on or before the Closing Date, as provided in Section 7 hereof. 

 

	15.	Preservation of Rights and Interest. ROI agrees to preserve and maintain the Subject Leases in full force and effect as to all lands covered thereby pending the
Closing of the transaction. ROI shall maintain the Subject Interest in a reasonable, prudent, businesslike manner pending the Closing, and shall take no action to encumber the Subject Interest or which would hinder or decrease the value of the
Subject Interest between the date this Agreement is signed and Closing. 

  
 8 

	16.	Confidentiality. 

  

	 	a.	Neither Party may make press releases or other public announcements concerning this transaction without the other’s prior written approval, except as may be
required by applicable laws or rules and regulation of any governmental agency or stock exchange. 

  

	 	b.	If the Closing does not occur, GMXR will keep all the information furnished by ROI to GMXR hereunder strictly confidential and will not use any of such information to
GMXR’s advantage or in competition with ROI; provided, however, that such restriction shall not apply to (i) information that is already known to GMXR as of the date hereof; (ii) information that is already publicly available or
becomes publicly available, other than through the act or omission of GMXR; (iii) information that is, upon advice of counsel, required to be disclosed under applicable law, legal process or by a governmental order, decree, regulation or rule
(provided that GMXR shall give written notice to ROI as soon as possible prior to such disclosure so that ROI may seek to obtain a protective order or other appropriate relief); or (iv) information that is acquired independently from a third
party that has the right to disseminate such information at the time it is acquired by GMXR. 

  

	17.	Purchase Option. 

  

	 	a.	Non-Competition. To the extent permitted by applicable law, for a period of three (3) years following the Closing Date, ROI shall not, directly or
indirectly, acquire (and shall ensure that, except as set forth herein, its affiliates do not acquire, directly or indirectly) any interest in any oil and gas lease, mineral interest, or other oil and gas interest covering any lands located in the
following townships in Goshen or Platte Counties: Township 23 North, Range 64 West; Township 24 North, Range 64 West; East 1/2 Township 24 North, Range 65 West; and West 1/2 Township 24 North, 65 West (the “AMI”).

  

	 	b.	 Acquired Interests. If during the period between the date of this Agreement and the third anniversary of the Closing Date (the “AMI
Term”) ROI or its affiliates, either solely or jointly with any other person or entity, should acquire or be granted an oil and gas lease, mineral interest, or other oil and gas interest covering any properties located in AMI (an
“Acquired Interest”), then ROI shall (or shall cause its affiliates to) notify GMXR of the acquisition (such notice to GMXR being referred to herein as the “Acquisition Notice”), such Acquisition Notice to be given
within thirty (30) days after the acquisition by ROI or its affiliate; provided, however, that with respect to acquisitions of Acquired Interests prior to Closing (“Pre-Closing Acquired Interests”), the Acquisition
Notice shall be provided as soon as possible after the consummation of the acquisition, but in any event not later than the Closing Date. GMXR shall have the right, but not the obligation, to acquire all of the Acquired Interest for a purchase price
equal to the lease bonus paid or purchase price paid by ROI or its affiliate (the “Acquisition Cost”) to acquire the Acquired Interests; provided, however that the purchase

  
 9 

	 	 
price for any Pre-Closing Acquired Interests shall be an amount equal to the greater of (i) $1,250 per net acre of the Acquired Interest or (ii) 120% of the Acquisition Cost for such
Pre-Closing Acquired Interest. The Acquisition Notice shall include a reasonably detailed description of the Acquired Interest, the lands and depths covered thereby, and the consideration paid therefor, and shall also include true, correct and
complete copies of any farmout agreement, purchase agreement, lease, option, assignment, or other instruments or agreements pursuant to which the interest was acquired or to which it is subject. At GMXR’s request, ROI shall meet with GMXR to
discuss and share any data that ROI used to support the purchase of the Acquired Interests. GMXR shall, within forty-five (45) days following the later of the Closing Date or GMXR’s receipt of the Acquisition Notice, notify ROI in writing
whether or not GMXR elects to purchase any Acquired Interest. A failure to timely respond to the Acquisition Notice shall be deemed an election not to purchase the Acquired Interest. If ROI or any of its affiliates acquires more than one Acquired
Interest, GMXR may make separate elections as to each Acquired Interest. If GMXR elects to purchase any Acquired Interests, then GMXR shall on the later of (i) the Closing Date or (ii) a date within forty-five (45) days following the
Acquisition Notice, pay by wire transfer the Acquisition Proceeds, and ROI shall deliver to GMXR an executed and acknowledged assignment thereof, substantially in the form of Exhibit C attached hereto, in sufficient counterparts to facilitate
recording, together with executed state or federal assignment forms, as applicable. The Acquired Interest shall be delivered to GMXR free and clear of any liens, claims or encumbrances arising by, through or under ROI or its affiliates, other than
burdens reserved or retained by ROI’s lessors, grantors, or assignors, as the case may be. As used herein, “affiliate,” means, when used with respect to any Person (as hereinafter defined), any individual, corporation,
partnership, joint venture, trust, limited liability company, limited liability limited partnership, unincorporated organization or other entity (each, a “Person”) which is directly or indirectly controlled by, controlling or under
common control with such Person. For purposes of this definition, “control” means, when used with respect to any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management of such
Person, whether through ownership of voting securities, by contract, or otherwise. 

  

	18.	Notices. All notices shall be in writing and shall be deemed sufficiently given with receipt obtained, when hand delivered, or sent by overnight courier,
certified mail, email transmission or telefax to the appropriate address as set forth below. Notices to the Parties shall be addressed as follows: 

  

			
	ROI:	  	GMXR:
		
	Retamco Operating, Inc.	  	GMX Resources, Inc.
	One South Broadway Ave.	  	One Benham Place, Suite 600
	Suite 2	  	9400 North Broadway
	Red Lodge, MT 59068	  	Oklahoma City, OK 73114
	Attention: Steve Gose	  	Attention: Gary D. Jackson

  
 10 

			
	Telephone: (210) 225-4031	  	Telephone: (405) 600-0711
	Fax: (210) 222-0586	  	Fax: (405) 600-0600
	E-mail: stevegose@retamco.com	  	E-mail: gjackson@GMXRresources.com
		
	With copies to:	  	With copies to:
		
	Drought Drought & Bobbitt, LLP	  	Andrews Kurth LLP
	112 E. Pecan Street, Suite 2900	  	600 Travis, Suite 4200
	San Antonio, TX 78205	  	Houston, TX 77002
	Attention: James L. Drought	  	Attention: David C. Buck
	& Calhoun Bobbitt	  	Telephone: (713) 220-4200
	Telephone: (210) 225-4031	  	Fax: (713) 220-4285
	Fax: (210) 222-0586	  	Email: dbuck@andrewskurth.com
	Email: jld@ddb-law.com	  	

  

	19.	Further Assurances. After the Closing, the parties agree to execute such further documents, deliver such further instruments or take such other actions as may be
reasonably requested in order to effectuate the transactions contemplated hereunder and to more effectively assure to each Party all of the respective properties, rights, titles, interests, estates, remedies, powers and privileges intended to be
assigned and delivered in consummation of the transactions contemplated hereby. 

  

	20.	Survival. The terms and conditions of this Agreement shall survive the Closing of the transactions contemplated hereby. 

 

	21.	Time of Essence. Time is expressly declared to be of the essence in this Agreement. 

 

	22.	Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns, and nothing contained
in this Agreement, express or implied, is intended to confer upon any other person or entity any benefits, rights or remedies. 

  

	23.	Governing Law. The laws of the State of Texas shall govern the interpretation of construction of this Agreement, excluding any conflicts-of-law rule or principle
that might apply the law of another jurisdiction. 

  

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

  

	25.	Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced under any rule of law, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in a materially adverse manner with respect to any Party.

  
 11 

	26.	Counterparts. This Agreement may be executed by ROI and GMXR in counterparts, each of which shall be deemed to be an original and all of which shall be deemed to
constitute one Agreement. 

  

	27.	Entire Agreement. This Agreement constitutes the entire agreement between the Parties, supercedes all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the Parties. No supplement, amendment, alteration, modification or waiver of this Agreement shall be binding unless executed in writing by the Parties hereto. 

[Signature Page Follows] 

  
 12 

 Executed this 13th day of January, 2011. 

 

			
	Retamco Operating, Inc.
		
	By:	 	 /s/ Steve Gose

		 	Steve Gose, President
	
	GMX Resources Inc.
		
	By:	 	 /s/ Ken Kenworthy

		 	Ken Kenworthy, CEO

  
 13

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