Document:

tdw-ex1038_237.htm

Exhibit 10.38

 

AWARD AGREEMENT

FOR THE GRANT OF RESTRICTED STOCK UNITS

UNDER THE

TIDEWATER INC. LEGACY GLF MANAGEMENT INCENTIVE PLAN 

 

 

THIS AGREEMENT is entered into as of [__________] (the “Date of Grant”) by and between Tidewater Inc., a Delaware corporation (“Tidewater” and, together with its subsidiaries, the “Company”), and the employee specified on the Term Sheet (as defined below and such employee, the “Employee”).  Capitalized terms used, but not defined, in this Agreement have the respective meanings provided in the Tidewater Inc. Legacy GLF Management Incentive Plan (the “Plan”).

WHEREAS, the Employee is a key employee of the Company and Tidewater considers it desirable and in its best interest that the Employee be given an added incentive to advance the interests of Tidewater in the form of restricted stock units payable in shares of common stock of Tidewater, $0.001 par value per share (the “Common Stock”) in accordance with the Plan; and

WHEREAS, the Company has provided the Employee with a written notice, dated as of the Date of Grant, of his or her grant under the Plan (the “Term Sheet”), which is incorporated by reference into this Agreement.

NOW, THEREFORE, in consideration of these premises and the mutual promises and covenants contained in this Agreement, it is agreed by and between the parties as follows:

I.
Restricted Stock Units

1.1Restricted Stock Units.  Effective on the Date of Grant, Tidewater hereby grants to the Employee under the Plan a Restricted Stock Unit Award, consisting of the total number of restricted stock units (the “RSUs”) specified on the Term Sheet, subject to the terms, conditions, and restrictions set forth in the Plan and in this Agreement.  

1.2Award Restrictions.  The RSUs may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, whether voluntarily or involuntarily.  The Employee will have no rights, including, but not limited to, voting and dividend rights, in the shares of Common Stock underlying the RSUs unless and until such shares are issued to the Employee, or as otherwise provided in the Plan or this Agreement. 

1.3Vesting Terms.

(a)Time-Based Vesting.  Upon vesting under the terms and conditions of the Plan and this Agreement, each RSU represents the right to receive from Tidewater one share of Common Stock, free of any restrictions, and any amounts, securities, and property notionally credited to the Employee’s Account (as defined in Section 2.1) with respect to such RSU.  

 

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(b)Vesting Schedule.  The RSUs will vest in three equal installments on the first three anniversaries of the Date of Grant provided that, except as provided in Section 1.4, the Employee remains employed by the Company on the applicable vesting date.

1.4Effect of Termination of Employment.

(a)Upon the Employee’s death or termination of employment due to Disability, all RSUs will immediately vest and pay out in shares of Common Stock.

(b)In the event the Employee retires on or after age 62 with five or more years of service with the Company, any unvested RSUs will vest and pay out in shares of Common Stock but only if and to the extent that the Committee, in its sole discretion, has specifically approved such action and subject to such restrictions as the Committee may impose (including, but not limited to, post-employment restrictive covenants such as non-competition, non-solicitation, and/or non-disclosure provisions).

(c)Except as otherwise expressly provided in this Section 1.4 or as otherwise determined by the Committee in its sole discretion, termination of employment will result in forfeiture of all unvested RSUs unless such termination is, in effect, a transfer of employment from one entity to another within the Company.  

II.
Dividend Equivalents and the Issuance of Shares Upon Vesting

2.1Restricted Stock Unit Account and Dividend Equivalents.  Tidewater will maintain an account (the “Account”) on its books in the name of the Employee.  The Account will reflect the number of RSUs awarded to the Employee, as such number may be adjusted under the terms of the Plan and this Agreement, as well as any additional RSUs, cash, or other securities or property credited as a result of dividend equivalents, administered as follows:

(a)The Account will be for recordkeeping purposes only, and no assets or other amounts will be set aside from Tidewater’s general assets with respect to such Account.  

(b)If Tidewater declares a cash dividend or distributes any other securities or property to stockholders between the Date of Grant and the date the RSUs vest and pay out under this Agreement (other than shares of Common Stock), the Employee will be entitled to any cash, securities, or other property (or, in the Committee’s discretion, a cash amount equal to the fair market value of such other securities or property) that would have been received as a dividend or distribution had the Employee’s outstanding RSUs been shares of Common Stock as of the record date for such dividend or distribution.  

(c)If dividends are declared and paid in the form of shares of Common Stock, then the Employee’s Account will be credited with one additional RSU for each share of Common Stock that would have been received as a dividend had the Employee’s outstanding RSUs been shares of Common Stock as of the record date for such dividend.

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(d)All cash, any additional RSUs credited via dividend equivalents, and any other securities or property credited to the Employee’s Account will vest and be paid out or be forfeited at the same time and on the same terms as the RSUs to which they relate.

2.2Issuance of Shares of Common Stock.  As soon as practicable following the date any RSUs vest under this Agreement, but no later than 30 days after such date, the number of shares of Common Stock to which the Employee is entitled under this Agreement will be transferred to the Employee or his or her nominee via book entry free of restrictions or, upon the Employee’s request, Tidewater will cause a stock certificate to be issued in the name of the Employee or his or her nominee.  Upon issuance of such shares, the Employee is free to hold or dispose of such shares, subject to applicable securities laws and any internal Company policy then in effect and applicable to the Employee, such as Tidewater’s Policy Statement on Insider Trading and Executive Stock Ownership Guidelines.

III.
Recovery Right of Tidewater

Tidewater has the right to recover any RSUs or shares of Common Stock issued under the Plan to the Employee, if (a) the grant, vesting, or value of such awards was based on the achievement of financial results that were subsequently the subject of a restatement; (b) the Employee is subject to Tidewater’s Executive Compensation Recovery Policy; (c) the Employee engaged in intentional misconduct that caused or partially caused the need for the restatement; and (d) the effect of the restatement was to decrease the financial results such that such grant would not have been earned or would have had a lesser value.  The Employee accepts the RSUs and shares of Common Stock subject to such recovery rights of Tidewater and in the event Tidewater exercises such rights, the Employee will promptly return the RSUs or shares of Common Stock to Tidewater upon demand.  If the Employee no longer holds the RSUs or shares of Common Stock at the time of demand by Tidewater, the Employee agrees to pay to Tidewater, without interest, all cash, securities, or other assets received by the Employee upon the sale or transfer of such shares.  Tidewater may, if it chooses, effect such recovery by withholding from other amounts due to the Employee by the Company.

IV.
Withholding Taxes

At any time that the Employee is required to pay to the Company an amount required to be withheld under the applicable income tax laws in connection with the vesting and payout of the RSUs (each such date, a “Tax Date”), the Employee may satisfy this obligation in whole or in part by electing (the “Election”) to deliver currently-owned shares of Common Stock or to have the Company withhold shares of Common Stock, in each case, having a value equal to the maximum statutory amount required to be withheld under federal, state, and local law.  If the Employee is subject to Section 16 of the Exchange Act, the Committee may not disapprove of the Employee’s right to make an Election with respect to the RSUs.  Further, unless the Employee has previously provided the Company with payment of all applicable withholding taxes, Tidewater will withhold, from the shares of Common Stock to be issued upon the vesting of the RSUs, shares with a value equal to the maximum statutory amount required to be 

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withheld.  The value of the shares to be withheld will be based on the closing sale price of a share of Common Stock on the Tax Date.  

V.
Restrictive Covenants

5.1Non-Disclosure of Confidential Information.  The Employee agrees to hold in a fiduciary capacity and for the benefit of the Company all Confidential Information that will have been obtained by the Employee during his or her employment (whether prior to or after the Date of Grant) and will use such Confidential Information solely in the good-faith performance of his or her duties for the Company.  During his or her employment and after his or her termination of employment, the Employee agrees (a) not to communicate or make available to any person or entity (other than the Company) any such Confidential Information, except upon the prior written authorization of the Company or as may be required by law or legal process, and (b) to deliver promptly to the Company upon its written request any Confidential Information in his or her possession.  In the event that the provisions of any applicable law or the order of any court would require the Employee to disclose or otherwise make available any Confidential Information to a governmental authority or to any other third party, the Employee agrees to give the Company, unless it is unlawful to do so, prompt prior written notice of such required disclosure and, if possible given the terms of any production order of the judicial governmental or administrative body, an opportunity to contest the requirement of such disclosure or apply for a protective order with respect to such Confidential Information by appropriate proceedings.  Notwithstanding the foregoing, the Employee understands that nothing contained in this Agreement limits his or her ability:  (x) to file a charge or complaint with any federal, state, or local governmental agency or commission (“Government Agencies”); (y) to communicate with any Government Agency or otherwise participate in any investigation or proceeding conducted by any Government Agency, without notice to the Company; or (z) to receive an award for information provided to any Government Agency.

5.2Covenant Not to Compete.  During the Employee’s term of employment and any Non-Compete Period (as defined below), the Employee agrees that he or she will not engage in competitive activities within any jurisdiction specified in Appendix A so long as the Company carries on a like line of business therein (collectively, the “Restricted Area”), as follows:

(a)The Employee will not, directly or indirectly, for himself or herself or others or in association with any other person, own, manage, operate, control, be employed in an executive, managerial, or supervisory capacity by, or otherwise engage or participate in, or allow his or her skill, knowledge, experience or reputation to be used in connection with, the ownership, management, operation, or control of any company or other business enterprise engaged in the Restricted Business within any of the Restricted Area; provided, however, that nothing contained in this Agreement prohibits the Employee from making passive investments as long as the Employee does not beneficially own more than 1% of the equity interests of a publicly traded business enterprise engaged in the Restricted Business within any of the Restricted Area.  For purposes of this paragraph, “beneficially own” has the same meaning ascribed to that term in Rule 13d-3 promulgated under the Exchange Act.

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(b)The Employee will not, directly or indirectly, for himself or herself or others or in association with any other person, solicit any customer of the Restricted Business or of the Company, or otherwise interfere, induce, or attempt to induce any customer, supplier, licensee, or business relation of the Company for the purpose of soliciting, diverting, interfering, or enticing away the business of such customer, supplier, licensee, or business relation, or otherwise disrupting any previously established relationship existing between such customer, supplier, licensee, or business relation and the Company.

(c)In the event that the Employee’s employment ends prior to the third anniversary of the Date of Grant and vesting of any portion of the RSUs granted under this Agreement is accelerated, the Employee agrees to continue to abide by the provisions of this Section 5.2 through the earlier to occur of the third anniversary of the Date of Grant or the first anniversary of his or her termination of employment (such period, the “Non-Compete Period”).

5.3Non-Solicitation.  During the Employee’s term of employment and for two (2) years thereafter (the “Restricted Period”), the Employee agrees that he or she will not, directly or indirectly, for himself or herself or others or in association with any other person, make contact with any of the employees or independent contractors of the Company for the purpose of soliciting such employee or independent contractor for hire, whether as an employee or independent contractor, or for the purpose of inducing such person to leave the employ of the Company or cease providing services to the Company, or otherwise to disrupt the relationship of such person with the Company.  In addition, during the Restricted Period, the Employee will not hire, on behalf of himself or herself or any company engaged in the Restricted Business, any employee of the Company, whether or not such engagement is solicited by the Employee.

5.4Injunctive Relief; Other Remedies.  The Employee acknowledges that a breach or threatened breach by the Employee of this Section 5 would cause immediate and irreparable harm to the Company not fully compensable by money damages or the exact amount of which would be difficult to ascertain, and therefore the Company will not have an adequate monetary remedy at law.  Accordingly, the Employee agrees that, in the event of a breach or threatened breach by the Employee of the provisions of this Section 5, the Company will be entitled to injunctive relief to prevent or curtail any such breach of threatened breach without the necessity of posting any bond or security or showing proof of actual damage or irreparable injury.  Nothing in this Agreement will be construed as prohibiting the Company from pursuing any other remedy at law or in equity to which the Company may be entitled under applicable law in the event of a breach or threatened breach of this Agreement by the Employee, including, without limitation, the recovery of damages, costs, and expenses, such as reasonable attorneys’ fees, incurred by the Company as a result of any such breach or threatened breach.  Nothing contained in this Agreement will be deemed to impair the Employee’s right to indemnification pursuant to (a) Tidewater’s certificate of incorporation or by-laws, (b) any Company insurance policy, (c) any indemnification agreement Employee may have with the Company, or (d) any policy, plan, or program maintained or sponsored by the Company.

5.5Employee’s Understanding of this Section 5.  The Employee acknowledges that the definition of Restricted Business, as well as the geographic and temporal scope of the covenants contained in this Section 5 are the result of arm’s-length bargaining and are fair and reasonable in light of (a) the importance of the functions performed by the Employee, (b) the 

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nature and wide geographic scope of the operations of the Company, and (c) the Employee’s level of control over and contact with the business and operations of the Company.

5.6Confidential Information.  For purposes of this Section 5, “Confidential Information” means confidential and proprietary information, knowledge, or data of any nature and in any form (including information that is electronically transmitted or stored on any form of magnetic or electronic storage media) of the past, current, or prospective business or operations of the Company, that is not publicly known, whether or not marked confidential, including, without limitation, information relating to any (a) services, projects, or jobs; (b) estimating or bidding procedures; (c) bidding strategies; (d) present and future business plans, actual or potential business acquisitions or joint ventures, capital expenditure projects, and cost summaries; (e) trade secrets; (f) marketing data, strategies, or techniques; (g) financial reports, budgets, projections, and cost analyses; (h) pricing information, codes, and analyses; (i) employee lists; (j) customer records, customer lists, and customer source lists; (k) confidential filings with any government agency; and (l) internal notes and memoranda relating to any of the foregoing, provided that Confidential Information will not include any information, knowledge, or data that is now, or hereafter becomes, known to the public (other than by breach of this Agreement by the Employee or breach by any other party of a confidentiality obligation owed to the Company).

VI.
No Contract of Employment Intended

Nothing in this Agreement confers upon the Employee any right to continue in the employment of the Company, or to interfere in any way with the right of the Company to terminate the Employee’s employment relationship with the Company at any time.

VII.
Binding Effect

This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, and successors.

VIII.
Amendment, Modification or Termination

The Committee may amend, modify, or terminate any RSUs at any time prior to vesting in any manner not inconsistent with the terms of the Plan.  Notwithstanding the foregoing, no amendment, modification, or termination may materially impair the rights of an Employee hereunder without the consent of the Employee.

IX.
Inconsistent Provisions

The RSUs granted hereby are subject to the provisions of the Plan, as in effect on the date hereof and as it may be amended.  In the event any provision of this Agreement (including the Term Sheet) conflicts with such a provision of the Plan, the Plan provision will control.  The Employee acknowledges that a copy of the Plan was distributed to the Employee and that the 

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Employee was advised to review such Plan prior to entering into this Agreement.  The Employee waives the right to claim that the provisions of the Plan are not binding upon the Employee and the Employee’s heirs, executors, administrators, legal representatives, and successors.

X.
Governing Law

This Agreement will be governed by and construed in accordance with the laws of the State of Texas.

XI.
Severability

If any term or provision of this Agreement, or the application thereof to any person or circumstance, will at any time or to any extent be invalid, illegal or unenforceable in any respect as written, the Employee and Tidewater intend for any court construing this Agreement to modify or limit such provision so as to render it valid and enforceable to the fullest extent allowed by law.  Any such provision that is not susceptible of such reformation will be ignored so as to not affect any other term or provision hereof, and the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid, illegal or unenforceable, will not be affected thereby and each term and provision of this Agreement will be valid and enforced to the fullest extent permitted by law.

XII.
Electronic Delivery and Execution of Documents

12.1The Company may, in its sole discretion, deliver any documents related to the Employee’s current or future participation in the Plan or any other equity compensation plan of the Company by electronic means or request Employee’s consent to the terms of an award by electronic means.  Such documents may include the plan, any grant notice, this Agreement, the plan prospectus, and any reports of Tidewater provided generally to Tidewater’s stockholders.  In addition, the Employee may deliver any grant notice or award agreement to the Company or to such third party involved in administering the applicable plan as the Company may designate from time to time.  By accepting the terms of this Agreement, the Employee also hereby consents to participate in such plans and to execute agreements setting the terms of participation through an on-line or electronic system established and maintained by the Company or a third party designated by the Company. 

12.2The Employee acknowledges that the Employee has read Section 12.1 of this Agreement and consents to the electronic delivery and electronic execution of plan documents as described in Section 12.1.  The Employee acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost to the Employee by contacting the Company by telephone or in writing.  

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XIII.
Entire Agreement; Modification

The Plan and this Agreement (including the Term Sheet) constitute the entire agreement between the parties with respect to the subject matter contained in this Agreement.  This Agreement may not be modified without the approval of the Committee and the Employee, except as provided in the Plan, as it may be amended from time to time in the manner provided in the Plan, or in this Agreement, as it may be amended from time to time.  Any oral or written agreements, representations, warranties, written inducements, or other communications with respect to the subject matter contained in this Agreement made prior to the execution of this Agreement will be void and ineffective for all purposes.

* * * * * * * * * * * * *

By clicking the “Accept” button, the Employee represents that he or she is familiar with the terms and provisions of the Plan, and hereby accepts this Agreement subject to all of the terms and provisions thereof.  The Employee has reviewed the Plan, this Agreement, and the prospectus in their entirety and fully understands all provisions of this Agreement.  The Employee agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee upon any questions arising under the Plan or this Agreement.

 

PLEASE PRINT AND KEEP A COPY FOR YOUR RECORDS

 

 

8Exhibit 10.1

 

Execution Version

 

 

 

February 24, 2019

 

Ring Energy, Inc.

901 West Wall Street

Midland, TX 79701

 

		Attention:	William R. Broaddrick

Vice President and Chief Financial Officer

 

		Re:	$1,000,000,000 Amended and Restated Senior Secured Revolving Credit Facility for Ring Energy, Inc.,
subject to an initial Borrowing Base of $425,000,000

 

Gentlemen:

 

Ring Energy, Inc.
(the “Company”) has advised SunTrust Bank and SunTrust Robinson Humphrey, Inc. (the “Lead Arranger”
and, together with SunTrust Bank, “SunTrust”) that the Company intends to acquire (the “Acquisition”)
the oil and gas properties and related assets in Coke, Gaines, Yoakum and Runnels Counties, Texas and Lea County, New Mexico (the
“Acquired Assets”) of Wishbone Energy Partners, LLC, Wishbone Texas Operating Company LLC and WB Waterworks,
LLC (collectively, the “Seller”) pursuant to a purchase and sale agreement between the Company and the Seller
(the “Acquisition Agreement”). You have further advised SunTrust that, in connection with the Acquisition, the
Company seeks to amend and restate its existing senior credit facility (the “Existing Senior Credit Facility”),
which amendment and restatement will increase the maximum facility amount from $500,000,000 to $1,000,000,000 and increase the
total borrowing base to $425,000,000, add additional lenders, extend the maturity date and make other modifications on the terms
set forth in the Summary of Principal Terms and Conditions attached hereto as Annex I (the “Term Sheet”).
As used in this letter, the “Amended and Restated Credit Agreement” means the proposed amended and restated
credit agreement described in this letter and the Term Sheet and the “Amended and Restated Senior Credit Facility”
means the Existing Senior Credit Facility as amended and restated by such proposed Amended and Restated Credit Agreement. All transactions
described above, together with the financing contemplated hereby, are sometimes referred to herein as the “Transactions”.
Capitalized terms used in this letter but not defined herein shall have the meanings given to them in the Term Sheet.

 

SunTrust Bank is
pleased to commit to provide the full amount of the $425,000,000 initial increased Borrowing Base, subject to the terms and conditions
set forth in this letter and the Term Sheet (collectively, this “Commitment Letter”). You hereby appoint SunTrust
Robinson Humphrey, Inc. to act, and the Lead Arranger agrees to act, as sole lead arranger and book manager for the Amended and
Restated Senior Credit Facility, subject to the terms and conditions of this Commitment Letter. No other agents, co-agents or arrangers
will be appointed, or other titles conferred, without the prior written consent of the Lead Arranger.

 

     

     

    

 

Ring Energy, Inc.

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		A.	Syndication

 

The Lead Arranger reserves
the right, before or after the execution of the Financing Documentation, to syndicate all or a portion of SunTrust Bank’s
commitment to one or more other financial institutions that will become parties to the Financing Documentation (such financial
institutions, the “Lenders”) and the commitment of SunTrust Bank hereunder shall be reduced dollar-for dollar
as and when the corresponding commitments are received. The Company understands that the Lead Arranger intends to commence such
syndication efforts promptly. The Company agrees to actively assist the Lead Arranger in achieving a Successful Syndication (as
defined in the Fee Letter) and take such action as the Lead Arranger may reasonably request related thereto. The Company’s
assistance shall include (but not be limited to) (i) making senior management, representatives and advisors of the Company and
its affiliates available to participate in meetings and to provide information to potential lenders under the Amended and Restated
Senior Credit Facility at such times and places as the Lead Arranger may reasonably request; (ii) using the Company’s existing
lending relationships to assist in the syndication process; and (iii) assisting in the preparation of an information memorandum
regarding the Company, the Acquired Assets, the Amended and Restated Credit Agreement and the Amended and Restated Senior Credit
Facility and other customary marketing materials to be used in connection with the syndication, in form and substance reasonably
acceptable to the Lead Arranger, at least 25 days prior to the Closing Date; and (iv) preparing and providing promptly to the Lead
Arranger all information with respect to the Company, its subsidiaries, the Acquired Assets and the Transactions, including without
limitation all financial information and projections (the “Projections”), reasonably requested by the Lead Arranger
in connection with the syndication of the Amended and Restated Credit Agreement.

 

The Lead Arranger will
manage all aspects of the syndication of the Amended and Restated Senior Credit Facility in consultation with SunTrust Bank and
the Company, including the timing of all offers to potential Lenders, the determination of all amounts offered to potential Lenders,
the selection of Lenders, the allocation of commitments, and the determination of compensation and titles (such as co-agent, managing
agent, etc.) given, if any, to such Lenders. The Company agrees that no other agents, co-agents or arrangers will be appointed,
or other titles conferred, without the prior written consent of the Lead Arranger, and that no Lender will receive any compensation
for its commitment to, or participation in, the Amended and Restated Senior Credit Facility except as expressly set forth in the
Term Sheet or the Fee Letter (as defined below), or as otherwise agreed to and offered by the Lead Arranger.

 

To ensure an orderly
and effective syndication of the Amended and Restated Senior Credit Facility, the Company further agrees that until the earlier
of termination of this Commitment Letter and a Successful Syndication (as defined in the Fee Letter), the Company will not, and
will not cause or permit any of its affiliates or agents to, arrange, sell, syndicate or issue, attempt to arrange, sell, syndicate
or issue, announce or authorize the announcement of the arrangement, sale, syndication or issuance of, or engage in discussions
concerning the arrangement, sale, syndication or issuance of, any credit facility or debt security (including any renewals thereof)
except with the prior written consent of the Lead Arranger.

 

		B.	Conditions Precedent

 

The undertakings and
obligations of SunTrust under this Commitment Letter are subject to: (i) the preparation, execution and delivery of loan documentation
substantially consistent with the Term Sheet, including an amendment and restatement of the Existing Credit Agreement incorporating
substantially the terms and conditions outlined in this Commitment Letter; (ii) the accuracy of all fundamental representations
that the Company makes to SunTrust (including those in Section D below) and all information that the Company furnishes to
SunTrust, and the absence of any information or other matter being disclosed after the date hereof that is inconsistent in a material
and adverse manner with any information or other material disclosed to SunTrust; (iii) the payment in full of all fees, expenses
and other amounts payable hereunder and under the Fee Letter; (iv) the compliance with the provisions of this Commitment Letter;
(v) the Closing Date on or prior to May 15, 2019; and (vi) the satisfaction of the other conditions set forth in the Term Sheet.

 

     

     

    

 

Ring Energy, Inc.

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		C.	Representations

 

The Company represents
and warrants to SunTrust that all information, other than the Projections, that has been or will be made available to SunTrust
or any of the Lenders by the Company or any of the Company’s representatives (or on your or their behalf) in connection with
the transactions contemplated by this Commitment Letter (the “Information”) is or will be, when furnished, complete
and correct in all material respects and does not or will not, when furnished, contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements contained therein not misleading and (ii) the Projections
have been or will be prepared in good faith based upon reasonable assumptions. The Company agrees to supplement the Information
and the Projections from time to time so that the representation and warranty contained in this paragraph remains correct. In issuing
the commitments and undertakings hereunder and in arranging and syndicating the Amended and Restated Senior Credit Facility, SunTrust
Bank and the Lead Arranger are relying on the accuracy of the Information and the Projections without independent verification
thereof.

 

The Company authorizes
the Lead Arranger and its affiliates, including SunTrust Bank, to share with each other, and to use, credit and other confidential
or non-public information regarding the Company to the extent permitted by applicable laws and regulations and for the purpose
of performing their obligations under this Commitment Letter and the Amended and Restated Senior Credit Facility.

 

		D.	Indemnities, Expenses, Fees Etc.

 

1.       Indemnification.  The
Company agrees to indemnify and hold harmless the Lead Arranger, SunTrust Bank, each other Lender, their respective affiliates
and their respective directors, officers, employees, agents, representatives, legal counsel, and consultants (each, an “Indemnified
Person”) against, and to reimburse each Indemnified Person upon its demand for, any losses, claims, damages, liabilities
or other expenses (“Losses”) incurred by such Indemnified Person or asserted against such Indemnified Person
by any third party or by the Company or any of its affiliates, arising out of or in connection with this Commitment Letter, the
Fee Letter, the financing and other Transactions or the use of the proceeds of the Amended and Restated Senior Credit Facility,
or any claim, litigation, investigation or proceeding relating to any of the foregoing (whether or not such Indemnified Person
is a party thereto), and to reimburse each Indemnified Person upon demand for any legal or other expenses incurred in connection
with investigating or defending any of the foregoing, whether or not such Indemnified Person is a party to any such proceeding,
in all cases, whether or not caused by or arising in whole or in part out of the comparative, contributory or sole negligence of
any indemnified person; provided that the Company shall not be liable pursuant to this indemnity for any Losses to the extent
that a court having competent jurisdiction shall have determined by a final judgment (not subject to further appeal) that such
Loss resulted from the gross negligence or willful misconduct of such Indemnified Person. The Company shall not, without the prior
written consent of any Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which such
Indemnified Person is a party and indemnity has been sought hereunder by such Indemnified Person, unless such settlement includes
an unconditional release of such Indemnified Person from all liability on claims that are the subject matter of such indemnity.
No Indemnified Person shall be responsible or liable to the Company or any other person or entity for any damages arising from
the use by others of the Information or other materials obtained through electronic, telecommunications or other information transmission
systems or for any special, punitive, indirect, exemplary or consequential damages in connection with the Amended and Restated
Credit Agreement or the Amended and Restated Senior Credit Facility.

 

     

     

    

 

Ring Energy, Inc.

Page
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2.       Fees
and Expenses. In addition to the fees described in the Term Sheet, the Company will pay (or cause to be paid) the fees set
forth in that certain letter agreement dated as of the date hereof, executed by SunTrust Bank and the Lead Arranger and acknowledged
and agreed to by the Company relating to this Commitment Letter (the “Fee Letter”). The Company also agrees
to pay, or to reimburse SunTrust on demand for, all reasonable costs and expenses incurred by SunTrust (whether incurred before
or after the date hereof) in connection with the Amended and Restated Credit Agreement, the Amended and Restated Senior Credit
Facility, the syndication thereof, the preparation of the Financing Documentation and the other Transactions, including, without
limitation, bank meeting expenses and fees and disbursements of its counsel, regardless of whether the Closing Date occurs. The
Company also agrees to pay all costs and expenses of SunTrust (including, without limitation, fees and disbursements of its counsel)
incurred in connection with the enforcement of any of its rights and remedies hereunder.

 

		E.	Miscellaneous

 

1.       Termination.
This Commitment Letter and all commitment and undertakings of SunTrust hereunder shall expire at 5:00 p.m., Atlanta,
Georgia time, on February 28, 2019, unless by such time the Company executes and
delivers to SunTrust this Commitment Letter and the Fee Letter. Thereafter, all commitments and obligations of SunTrust under
this Commitment Letter will terminate upon the earliest to occur of (i) consummation of the Acquisition (with or without the
use of the Amended and Restated Senior Credit Facility), (ii) termination of the Acquisition Agreement, either by its terms
or by a court of competent jurisdiction, or (iii) at 5:00 p.m. Atlanta, Georgia time on May 15, 20191 unless the
Closing Date occurs on or prior to such date. In addition to the foregoing, this Commitment Letter may be terminated at any
time by mutual agreement, and all commitments and undertakings of SunTrust hereunder may be terminated by SunTrust if the
Company fails to perform its obligations under this Commitment Letter or the Fee Letter on a timely basis.

 

2.       No
Third-Party Beneficiaries. This Commitment Letter is solely for the benefit of the Company, SunTrust and the Indemnified Persons;
no provision hereof shall be deemed to confer rights on any other person or entity.

 

3.       No
Assignment; Amendment. This Commitment Letter and the Fee Letter may not be assigned by the Company to any other person or
entity, but all of the obligations of the Company hereunder and under the Fee Letter shall be binding upon the successors and assigns
of the Company. This Commitment Letter and the Fee Letter may be not be amended or modified except in writing executed by each
of the parties hereto.

 

4.       Use
of Name and Information. The Company agrees that any references to SunTrust or any of its affiliates made in connection with
the Amended and Restated Senior Credit Facility are subject to the prior approval of SunTrust, which approval shall not be unreasonably
withheld. SunTrust shall be permitted to use information related to the syndication and arrangement of the Amended and Restated
Senior Credit Facility in connection with marketing, press releases or other transactional announcements or updates provided to
investor or trade publications; including, but not limited to, the placement of “tombstone” advertisements in publications
of its choice at its own expense.

 

 

1
NTD: To be same date as Section B.(vi)

 

     

     

    

 

Ring Energy, Inc.

Page
5

 

5.       Governing
Law; Waiver of Jury Trial. This Commitment Letter and the Fee Letter will be governed by and construed in accordance with the
laws of the state of Texas without regard to the principles of conflicts of laws thereof. EACH OF THE COMPANY AND SUNTRUST IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING
OUT OF OR RELATED TO THIS COMMITMENT LETTER, THE FEE LETTER OR ANY OF THE TRANSACTIONS OR THE ACTIONS OF SUNTRUST IN THE NEGOTIATION,
PERFORMANCE OR ENFORCEMENT HEREOF.

 

THE COMPANY IRREVOCABLY
AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF ANY STATE COURT IN THE STATE OF GEORGIA OR THE UNITED STATES DISTRICT
COURT FOR THE NORTHERN DISTRICT OF GEORGIA FOR THE PURPOSE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
COMMITMENT LETTER, THE FEE LETTER, AND THE OTHER TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY AND IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. THE COMPANY AND IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. A FINAL
JUDGMENT IN ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT MAY BE ENFORCED IN ANY OTHER COURTS TO WHOSE JURISDICTION
THE COMPANY OR SUNTRUST ARE OR MAY BE SUBJECT, BY SUIT UPON JUDGMENT. SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT ON THE
COMPANY MAY BE MADE BY REGISTERED MAIL ADDRESSED TO THE COMPANY AT THE ADDRESS APPEARING AT THE BEGINNING OF THIS LETTER FOR ANY
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT PURSUANT TO THIS COMMITMENT LETTER.

 

6.       Survival.
The obligations of the Company under the expense reimbursement, indemnification, confidentiality, and governing law, submission
to jurisdiction, jury trial waiver and related provisions of this Commitment Letter shall survive the expiration and termination
of this Commitment Letter.

 

7.       Confidentiality.
The Company will not disclose or permit disclosure of this Commitment Letter, the Fee Letter nor the contents of the foregoing
to any person or entity (including, without limitation, any Lender other than SunTrust), either directly or indirectly, orally
or in writing, except (i) to the Company’s officers, directors, agents and legal counsel who are directly involved in the
transactions contemplated hereby, in each case on a confidential basis, (ii) with respect to this Commitment Letter (but not the
Fee Letter), to the Seller and its officers, directors, agents and legal counsel on a confidential basis or (iii) as required by
law (in which case the Company agrees to inform SunTrust promptly thereof).

 

     

     

    

 

Ring Energy, Inc.

Page
6

 

8.       No
fiduciary duty. The Company acknowledges and agrees that (i) the commitment to and syndication of the Amended and Restated
Senior Credit Facility pursuant to this Commitment Letter is an arm's-length commercial transaction between the Company, on the
one hand, and SunTrust, on the other, and the Company is capable of evaluating and understanding, and does understand and accept,
the terms, risks and conditions of the transactions contemplated by this Commitment Letter, (ii) in connection with the transactions
contemplated hereby and the process leading to such transactions, SunTrust is and has been acting solely as a principal and is
not the agent or fiduciary of the Company or its stockholders, creditors, employees or any other party, (iii) SunTrust has not
assumed an advisory responsibility or fiduciary duty in favor of the Company with respect to the transactions contemplated hereby
or the process leading thereto (irrespective of whether SunTrust has advised or is currently advising the Company on other matters)
or any other obligation to the Company except the obligations expressly set forth in this Commitment Letter, (iv) SunTrust and
its affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and
its affiliates, and SunTrust has no obligation to disclose any of such interests by virtue of any fiduciary or advisory or other
relationship as a consequence of this Commitment Letter, and (v) SunTrust has not provided any legal, accounting, regulatory or
tax advice with respect to any transactions contemplated hereby and the Company has consulted its own legal, accounting, regulatory
and tax advisors to the extent it deemed appropriate. The Company waives and releases, to the fullest extent permitted by law,
any claims that it may have against SunTrust with respect to any breach or alleged breach of fiduciary duty as a consequence of
this Commitment Letter.

 

9.       Counterparts.
This Commitment Letter and the Fee Letter may be executed in any number of separate counterparts, all of which together constitute
one original. Delivery of an executed counterpart of a signature page to this Commitment Letter or the Fee Letter by facsimile
transmission or electronic transmission (in pdf form) shall be as effective as delivery of a manually executed counterpart hereof.

 

10.       Entire
Agreement; Swap Disclaimer. (a) This Commitment Letter and the Fee Letter embody the entire agreement and understanding among
SunTrust, the Company and their affiliates with respect to the Amended and Restated Senior Credit Facility and any transactions
related thereto, and supersede all prior understandings and agreements among the parties relating to the subject matter hereof.
However, the terms and conditions of the commitments of SunTrust Bank and the undertakings of the Lead Arranger hereunder are not
limited to those set forth herein, in the Term Sheet or in the Fee Letter; those matters not covered or made clear herein or in
the Term Sheet are subject to mutual agreement of the parties.

 

(b)       Nothing
herein constitutes an offer or recommendation to enter into any “swap” or trading strategy involving a “swap”
within the meaning of Section 1a(47) of the Commodity Exchange Act. Any such offer or recommendation, if any, will only occur after
we have received appropriate documentation from you regarding whether you are qualified to enter into a swap under applicable law.

 

11.       Patriot
Act. SunTrust hereby notifies the Company that pursuant to the requirements of the USA Patriot Improvement and Reauthorization
Act of 2005, Title III of Pub. L. 109-177 (signed into law March 9, 2006) (the “Patriot Act”) and the requirements
of 31 C.F.R. § 1010.230 (the “Beneficial Ownership Regulation”), it and its affiliates are required to
obtain, verify and record information that identifies the Company and certain of its affiliates, which information includes their
names, addresses, tax identification numbers and other information that will allow SunTrust to identify the Company and certain
of its affiliates in accordance with the Patriot Act or the Beneficial Ownership Regulation, as applicable. This notice is given
in accordance with the requirements of the Patriot Act and is effective for SunTrust and its affiliates.

 

[Remainder of this page
is intentionally blank]

 

     

     

    

 

We look forward to
working with you on this important transaction.

 

	 	Very truly yours,
	 	 
	 	SUNTRUST BANK 
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

	 	SunTrust Robinson Humphrey, Inc.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

Signature Page to Commitment Letter

 

     

     

    

 

ACCEPTED AND AGREED

this ____ day of February, 2019:

 

RING ENERGY, INC. 

 

	By:	 	 
	 	William R. Broaddrick	 
	 	Vice President and Chief Financial Officer	 

 

Signature Page to Commitment Letter

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