Exhibit 2.1

ASSET PURCHASE AND SALE AGREEMENT

by and between

CHAPARRAL ENERGY, L.L.C. and

CHAPARRAL CO2, L.L.C. and

CHAPARRAL REAL ESTATE, L.L.C.
(Collectively Seller)

and

PERDURE PETROLEUM, LLC
(Purchaser)


dated October 13, 2017

TABLE OF CONTENTS

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Exhibits

Exhibit A -Leases

Exhibit B -Wells/Units

Exhibit B-1 -WI/NRI/Allocated Values

Exhibit C -Pipeline Assets

Exhibit D -General Assignment

Exhibit E Fee Surface Acreage

Schedules

Schedule 1.6 - Excluded Assets

Schedule 2.4.15 - Suspense Funds

Schedule 2.6 -Tax Allocations

Schedule 3.2.2(ix) - Permitted Encumbrances - Tax Liens

Schedule 5.6.2 - Environmental D efects

Schedule 6.2.8 - Gas Imbalances

Schedule 6.2.9 - Material Contracts

Schedule 6.2.10 - Environmental Issues

Schedule 6.2.11 - Consents

Schedule 6.2.12 - Preferential Purchase Rights

Schedule 6.2.14 - Wells and Equipment

Schedule 6.2.15 - Pipelines

Schedule 6.2.16 - Permits

Schedule 6.3 - Knowledge Persons

Schedule 8.1 - Outstanding AFE’s and Commitments

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ASSET PURCHASE AND SALE AGREEMENT

This Asset Purchase and Sale Agreement (this “ Agreement ”) is made and entered into this 13 day of October, 2017, by and between Chaparral Energy, L.L.C., an Oklahoma limited liability company, Chaparral CO2, L.L.C., an Oklahoma limited liability company, Chaparral Real Estate, L.L.C., an Oklahoma limited liability company (collectively “ Seller ”), having as its address 701 Cedar Lake Boulevard, Oklahoma City, Oklahoma 73114, and Perdure Petroleum, LLC, a Delaware limited liability company (“ Purchaser ”), having as its address 12012 Wickchester Lane, Suite 660, Houston, Texas 77079.  Sellers and Purchaser are sometimes collectively referred to in this Agreement as the “ Parties ” or individually as a “ Party ”.

W I T N E S S E T H:

WHEREAS, Seller is the owner of the Assets (as defined below); and

WHEREAS, Seller is willing to sell and deliver to Purchaser, and Purchaser is willing to purchase and receive from Seller, the Assets upon the terms and conditions set forth in this Agreement.

NOW, THEREFORE, for and in consideration of the mutual promises of the Parties contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. PURCHASE AND SALE

1.1 Agreement to Sell and Purchase

.  Subject to the terms and conditions of this Agreement, Purchaser agrees to purchase and receive, and Seller agrees to sell, assign, transfer, convey, and deliver, the Assets, as of the Effective Date (as defined below).

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1.3 Effective Date

.  Ownership of the Assets shall be transferred from Seller to Purchaser at the Closing (as defined below), but shall be effective as provided in Section 2.4 below as of 7:00 a.m. (local time where the Assets are located) on June 1, 2017, (the “ Effective Date ”).  Except to the extent accounted for in adjustments to the Purchase Price under Section 2.4 and subject to the provisions herein, Seller shall be entitled to any amounts realized from and accruing to the Assets (including contract rights, gas contract settlements, take-or-pay claims, and other claims and causes of action) for all periods prior to the Effective Date and shall be liable for the payment of all Property Costs incurred by Seller prior to the Closing and attributable to periods prior to the Effective Date.  Except to the extent accounted for in adjustments to the Purchase Price under Section 2.4 and subject to the provisions herein, Purchaser shall be entitled to any amounts realized from and accruing to the Assets for all periods on and after the Effective Date, and shall be liable for the payment of all expenses relating to the Assets and attributable to all periods on and after the Effective Date.

1.4 Gauging and Strapping

.  Seller has caused the oil storage facilities on or utilized in connection with the Properties to be gauged or strapped as of the Effective Date for those Properties for which a Seller serves as operator.  Seller also has caused the gas production meter charts (or if such do not exist, the sales meter charts) on the pipelines transporting gas production from the Assets to be read as of the Effective Date for those Properties for which a Seller serves as operator.  Prior to the Closing, Purchaser shall be provided with access to the records of the gauging, strapping or chart reading for the purpose of verifying such records.  For those Properties not operated by a Seller, applicable state regulatory agency production reports or records shall be used to determine the amount of oil in storage or gas existing in the pipeline as of the Effective Date.  If such state records or reports are not available or sufficient, Seller’s reasonable estimate based on historical data shall be used.

1.5 Records

.  Seller shall deliver to Purchaser, within thirty (30) days after the Closing or such later time as Purchaser may request, but in no event later than ninety (90) days after the Closing, all Records, including in electronic form where available.  Seller shall have the right to

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make and retain such copies of the Records as Seller may desire prior to the delivery of the Records to Purcha ser.  Purchaser, for a period of three (3) years after the Closing, shall further make available to Seller (at the location of such Records in Purchaser’s organization) access to the Records during normal business hours, upon written request of Seller, and Seller shall have the right to copy at its own expense and retain such copies of the Records.  If, however, Purchaser elects to destroy any of the Records, either before or after the expiration of such three (3) year period, Purchaser shall give to Seller written notice of such intent at least thirty (30) days prior to such destruction, and Seller shall have the option, at its expense, of having such Records delivered to them.  This obligation shall be an obligation running with the land, and Purchaser sha ll include the obligations set forth in this Section  1.5 as an obligation of any subsequent purchaser of any of the Properties in the applicable purchase and sale a greement with, and/or assignment to, such subsequent purchaser.    E xcept as expressly provided in this Agreement or in the General Assignment, Seller makes no representation or warranty, and expressly disclaims all representations and warranties as to the a ccuracy or completeness of the Records that it may provide or disclose to Purchaser .

1.6 Excluded Assets

.  Seller excepts, reserves, and retains to itself the following rights, properties and assets:  (i) all corporate, financial, legal, and (except as provided in Section 1.2.13) Tax records of Seller, including, without limitation, all documents protected by the attorney-client privilege (other than title opinions); (ii) all deposits, cash, checks, cash equivalents and funds attributable to the Assets for the period prior to the Effective Date; (iii) all rights, interests, and claims that any Seller may have under any policy of insurance or indemnity, surety bond, or any insurance or condemnation proceeds or recoveries from third persons relating to property damage or Casualty Loss affecting the Assets occurring prior to the Effective Date; (iv) except to the extent related to any Assumed Obligations, all claims, whether in contract, in tort, or arising by operation of law, and whether asserted or unasserted as of the Closing Date, that any Seller may have against any person arising out of acts, omissions, or events, or injury to or death of persons or loss or destruction of or damage to property, relating in any way to the Assets that occurred prior to the Effective Date; provided, however, that no such claim may be settled, compromised, or otherwise resolved in a manner that results in an obligation borne by Purchaser or the Assets on and after the Effective Date without the prior written consent of Purchaser, which shall not to be unreasonably withheld or delayed; (v) all exchange traded futures contracts and over-the-counter derivative contracts of Seller as to which Seller has an open position as of the Effective Date; (vi) any and all rights to use Seller’s names, marks, trade dress or insignia, or to use the name of Seller, and all of Seller’s intellectual property, including, without limitation, proprietary or licensed computer software; patents; trade secrets; copyrights; geological and geophysical information and data (including, without limitation, conventional 2-D and 3-D seismic data) licensed from third persons, and Seller’s proprietary interpretations thereof; economic analyses; and pricing forecasts; (vii) all amounts due or payable to Seller as adjustments to insurance premiums related to the Assets for periods prior to the Effective Date; (viii) all claims of Seller for any Tax refunds and loss carry-forwards and carry-backs with respect to any Taxes relating to the Assets for periods prior to the Effective Date; (ix) to the extent related to the Retained Liabilities or other matters for which Seller is obligated to indemnify Purchaser hereunder, all audit rights and all amounts due or payable to Seller as refunds, adjustments, or settlements of disputes arising under the Properties or the Existing

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Contracts for periods prior to the Effective Date; (x) to the extent not included in definition of “Assets”, all inventories of pipe , equipment and other Personal Property; (xi) to the extent not included i n definition of “Assets”, all rights, titles, and interests of Seller in and to all tools, equipment and similar personal property temporarily located on the Properties or the lands attributable thereto; (xii) to the extent not included in definition of “A ssets”, all cars, trucks, trailers, backhoes, graders and other similar rolling stock and equipment; (xiii) all other interests, rights, property, and assets of Seller not located on or used in connection with the Assets or otherwise specifically included in the definition of the Assets; and (xiv) any items listed on Schedule 1.6.

2. SALE AND PURCHASE

2.1 Purchase and Sale

.  At the Closing, Seller shall sell, assign, transfer, and convey to Purchaser, and Purchaser shall purchase and pay for, the Assets, and Purchaser shall also assume the Assumed Obligations as set forth in Section 13.3.1.

2.2 Purchase Price

.  The purchase price to be paid by Purchaser to Seller with respect to the Assets shall be One Hundred Seventy Million Dollars U.S. ($170,000,000) (the “ Purchase Price ”), subject to the adjustments provided in Section 2.4.  The amount of the Purchase Price has been agreed to taking into account, among other factors, the perceived value of the Assets and Purchaser’s assumption of the Assumed Obligations as set forth in Section 13.3.1.

. For each Month during, and including, the period of January 1, 2018 through December 31, 2020, if (i) the produced volumes of oil production attributable to Purchaser’s Net Revenue Interest in the Assets (the “ Purchaser’s Actual Production ”) for such Month are greater than the volumes of oil production from the Assets that are subject to a Hedge Contract (the “ Hedged Production ”) for such Month and (ii) the average sale price for the Purchaser’s Actual Production for such Month (net of any amounts payable as severance, sales, excise and other production-related Taxes, transportation costs and differential) is greater than the price received by Purchaser in respect of the Hedged Production for such Month, Purchaser shall pay Seller (x) the difference between the Purchaser’s Actual Production for such Month and the Hedged Production for such Month, multiplied by (y) the difference between the average sale price for the Purchaser’s Actual Production for such Month (net of any amounts payable as severance, sales, excise and other production-related Taxes, transportation costs and differential) and the price received by Purchaser in respect of the Hedged Production for such Month, multiplied by (z) thirty percent (30%) (the “ Additional Consideration ”); provided, however, that notwithstanding anything to the contrary set forth herein, in no event shall Purchaser be obligated to pay to Seller any amounts hereunder in respect of Additional Consideration in excess of an aggregate Seventeen Million Dollars ($17,000,000).  The Additional Consideration shall be a part of the purchase price for the Assets.  Purchaser shall settle the amount of Additional Consideration due on a quarterly basis and shall deliver to Seller all amounts in respect of Additional Consideration owed for a calendar quarter not later than sixty (60) days after the end of the applicable calendar quarter.  

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2.3 Performance Deposit

.  As evidence of good faith intentions to consummate the transactions contemplated hereby, Purchaser shall tender to JP Morgan Chase Bank  N.A. (the “ Escrow Agent ”) a cash performance deposit in the amount of seven percent (7%) of the Purchase Price, said amount being Eleven Million Nine Hundred Thousand Dollars U.S. ($11,900,00) (the “ Performance Deposit ”) on the date this Agreement is executed.  If this Agreement is terminated by Seller pursuant to Section 15.1.2, the Parties shall jointly instruct the Escrow Agent to release the Performance Deposit to Seller as liquidated damages representing Seller’s sole remedy for Purchaser’s failure to consummate the transaction contemplated herein (without waiving any indemnification obligation of Purchaser).  The Parties agree that the Performance Deposit is a reasonable sum considering all the circumstances existing on the date of this Agreement, including the relationship of the sum to the range of harm to Seller that reasonably could be anticipated and the anticipation that proof of actual damages would be costly or inconvenient.  If this Agreement is terminated for any reason other than Section 15.1.2, the Parties shall jointly instruct the Escrow Agent to release the Performance Deposit to Purchaser.  In the event the transactions contemplated herein close, the Performance Deposit and any interest and/or income accumulated thereon shall be credited against the Purchase Price payable by Purchaser hereunder.  

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2.5 Payment of Adjusted Purchase Price

.  At the Closing, Purchaser shall cause to be delivered by wire transfer to Seller in accordance with wire transfer instructions provided by Seller an amount in immediately available U.S. funds equal to the Purchase Price, plus or minus the adjustments provided for in Section 2.4 (to the extent then reasonably known) calculated as provided in Section 12.3 and less any amounts paid to the Escrow Agent in accordance with Sections 3.4, 3.5.1, 5.4 and 5.5.1 (such amounts paid to the Escrow Agent at Closing the “ Escrow Amount ” and the amount to be paid to Seller at Closing the “ Preliminary Amount ”).  The Preliminary Amount paid at the Closing shall be subject to later adjustment pursuant to Section 13.1.

2.6 Tax Purchase Price Allocations

.  Seller and Purchaser recognize that reporting requirements, as imposed by Section 1060 of the Internal Revenue Code of 1986, as amended (the “ IRC ” or “ Code ”), and the regulations thereunder, may apply to the transaction contemplated by this Agreement.  Seller and Purchaser shall cooperate in preparing a schedule that allocates the purchase price (as determined for U.S. federal income Tax purposes) among the Assets in accordance with Section 1060 of the Code (the “ Tax Allocation Schedule ”).  Purchaser shall prepare and deliver to Seller an initial draft of the Tax Allocation Schedule within thirty (30) days after the final adjustment to the purchase price under this Agreement.  Seller and Purchaser shall then cooperate to prepare a final Tax Allocation Schedule within thirty (30) days after delivery of the initial draft of such schedule.  Except as may otherwise be required by the IRC and regulations thereunder or other Applicable Laws, Seller and Purchaser agree (i) that any required Internal Revenue Service Form 8594 (“ Form 8594 ”) (or similar form under state, local or foreign Tax law) shall be prepared in a manner consistent with the final Tax Allocation Schedule and (ii) not to assert, in connection with any Tax return, Tax audit, or similar proceeding, any allocation of the purchase price that differs from the final Tax Allocation Schedule.   Each Party agrees to promptly notify the other Party regarding the existence of any Tax audit or similar proceeding related to the allocation described in this Section 2.6 and, to the extent there is a challenge to the Tax Allocation Schedule in any Tax audit or similar proceeding, a party may adopt an allocation that is inconsistent with the Tax Allocation Schedule if to do so is necessary to reasonably resolve such audit or proceeding.

3. TITLE MATTERS

3.1 Access to Records and Assets

.  Upon execution of this Agreement and until the Closing, and thereafter to the extent Seller retains physical possession of any of the Assets and/or Records, Seller shall make the Records available to Purchaser at its offices located at the address set forth in the introductory paragraph of this Agreement, during normal business hours, for examination and copying by Purchaser and, with respect to the Properties operated by Seller,

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shall grant Purchaser access to such Properties for inspection.  Seller sha ll not be obligated to perform any title work or provide abstracts other than those presently in Seller’s possession, nor will any existing title opinions be brought current by Seller.  Seller will use reasonable commercial efforts to furnish to Purchaser all other information with respect to the Assets that Purchaser may from time to time reasonably request, except to the extent that Seller determines in good faith that it is prohibited by agreement with a third party from disclosing the information covere d thereby.  Purchaser agrees to conduct its due diligence in a professional and orderly manner and at its own cost and expense without disruption of Seller’s normal and usual operations.   Purchaser shall indemnify and hold harmless Seller and its partners, shareholders, members, officers, directors, trustees, employees, agents and representatives (collectively the “ Seller Group ”) from any and all claims, demands, damages, losses, liabilities, costs and expenses, including court costs and reasonable attorney ’s fees (collectively “ Costs ”), resulting from Purchaser’s acts or omissions in connection with its access to the Assets, regardless of whether such Costs are attributable, in whole or in part, to the negligence, sole or concurrent, of the Seller Group, ex cepting only Costs to the extent actually resulting (i) on the account of the gross negligence or willful misconduct of a member of Seller Group or (ii) from matters discovered or uncovered by Purchaser or Purchaser’s representatives in the course of such due diligence investigation to the extent such discoveries are of pre-existing conditions (including any Title Defects) not caused or exacerbated (which term shall specifically exclude the discovery of such conditions) by Purchaser or Purchaser’s represent atives.   

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3.3 Notice of Title Defect

.  During the period of time between the execution of this Agreement and October 27, 2017 (the “ Due Diligence Period ”), Purchaser may review title to the Properties and may notify Seller in writing (the “ Title Defect Notice ”) of any Title Defect; provided, however, Purchaser shall exercise reasonable efforts to inform Seller of Title Defects as they are discovered.  Any notice provided hereunder shall include appropriate evidence to reasonably support the Purchaser’s position, including (i) identification of the Title Defect Property, (ii) a description of the Title Defect(s) asserted by Purchaser with respect to such Title Defect Property, (iii) the basis for the Title Defect(s), (iv) the Allocated Value of the Title Defect Property, (v)  the portion of the Title Defect Property affected by the Title Defect, (vi) the Title Defect Amount asserted by Purchaser with respect to such Title Defect, and (vii) the computations and information upon which Purchaser’s assertion is based; provided, however, that an alleged failure to comply with subsections (i) through (vii) above shall not cause any such notice to be invalid or any Title Defect to be waived if the Title Defect Notice is reasonably sufficient (A) to provide notice to Seller of the existence and general nature of the Title Defect and (B) for Seller to verify the existence of the alleged Title Defect.  Purchaser will be deemed to have conclusively waived any Title Defect discovered by Purchaser during the Due Diligence Period about which it fails to notify Seller in writing in the manner described above prior to the expiration thereof; provided, however, that Purchaser shall not be deemed to have waived any such Title Defect for purposes of the special warranty of title set out in the General Assignment.

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3.4 Remedies for Title Defects

.  For any Title Defect properly asserted by Purchaser during the Due Diligence Period, subject to the termination rights of Seller and Purchaser pursuant to Section 3.8 hereof, and subject to Seller’s rights under Section 3.5.1, Seller shall have the option, in its sole discretion, by written notice to Purchaser which shall be delivered on or before the date that is two (2) business day prior to Closing of (i) curing the Title Defect, (ii) reducing the Purchase Price by the proposed Title Defect Amount (a “ Title Defect Adjustment ”), or (iii) if the Title Defect Adjustment for any Title Defect Property equals, or but for the limitations in Section 3.6 would exceed, the Allocated Value for such Property, Seller shall have the option of removing the affected Property from the transaction contemplated herein and reducing the Purchase Price by the Allocated Value thereof and such Assets shall be Excluded Assets for all purposes hereunder. In the event Seller elects option (i) above, then the Closing shall proceed as scheduled, the Property affected by the asserted Title Defect shall be conveyed to Purchaser at Closing without adjustment to the Purchase Price and the Title Defect Amount Purchaser reasonably asserted in its Title Defect Notice shall be deposited with the Escrow Agent, which amount shall be disbursed pursuant to Sections 3.5.2 and 3.9.

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In no event, however, shall the total of the Title Defect Amounts related to a particular Asset exceed the Allocated Value of such Asset.  The Title Defect Amount with respect to a Title Defect shall be determined without any duplication of defects fully addressed in the Title Defect Amount of any other Title Defects, or for which Purchaser otherwise receives credit in the calculation of the Purchase Price.

3.7 Interest Additions

.  If Seller discovers (i) that Seller owns an interest in a Property that is not described in Exhibit A but will be conveyed to Purchaser at Closing, and such additional Property is otherwise free of Title Defects, or (ii) that the actual Net Revenue Interest for a Well or Unit described on Exhibit B-1 is greater than the Net Revenue Interest shown for such Well or Unit on Exhibit B-1, and such Well is otherwise free of Title Defects (in each case, an “ Interest Addition ”), then Seller shall, from time to time, have the right to give Purchaser written notice of such Interest Additions (“ Interest Addition Notice ”), as soon as practicable but no later than the end of the Due Diligence Period, stating with reasonable specificity the Property affected, the particular Interest Addition claimed, and Seller’s good faith estimate of the value of the additional Property or the amount by which the Additional Interest increases the value of the affected Property over and above the Allocated Value for such Property (“ Interest Addition Value ”).  If Purchaser agrees with the existence of the Interest Addition and Seller’s good faith estimate of the Interest Addition Value, then the Interest Addition Value shall be added to and increase the amount of the Aggregate Title Deductible.  If Purchaser contests the existence of the Interest Addition or Seller’s good faith estimate of the Interest Addition Value, then Purchaser shall so notify Seller in writing on or before five (5) days after receipt of the Interest Addition Notice (“ Interest Addition Rejection Notice ”).  The Interest Addition Rejection Notice shall state with reasonable specificity the basis of Purchaser’s rejection of the Additional Interest or the Interest Addition Value.  No later than five (5) days following delivery of the Interest Addition Rejection Notice, representatives of Purchaser and Seller, knowledgeable in title matters, shall meet and either (i) agree to mutually reject the Interest Addition, in which case Seller shall waive the Interest Addition, or (ii) agree on the validity of such Interest Addition and the Interest Addition Value, in which case Seller shall be entitled to an increase in the Aggregate Title Deductible.  If the Parties cannot agree on either option (i) or (ii) in the preceding sentence, the Interest Addition subject to the Interest Addition Rejection Notice shall be submitted to dispute resolution in accordance with the procedures set forth in Section 3.9.  If Purchaser fails to timely deliver an Interest Addition Rejection Notice, Purchaser shall be deemed to have accepted the validity of the Interest Addition and the Interest Addition Value, and Seller shall be entitled to an increase in the Aggregate Title Deductible.

3.8 Right to Terminate Agreement

.  Notwithstanding anything in Article 3, Article 4 or Article 5, in the event the sum of (i) the amounts to be delivered to the Escrow Agent attributed to Title Defects and Environmental Defects, (ii) adjustments to the Purchase Price attributable to Title Defects and Environmental Defects as to which the Parties have agreed to as of the Closing Date (including, without limitation, adjustments as to affected Properties removed from the transactions under this Agreement pursuant to Article 3 or Article 5), and (iii) adjustments to the

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Purchase Price attributed to preferential purchase rights in accordance with Section 3.10 , Required Consents in accordance with Section 3.10 and Casualty Losses (as hereinafter defined) in accordance with Section 4.1 equals or exceeds fifteen percent (15%) of the Purchase Price, then Seller or Purchaser may, by written notice given to the other Party not less than two (2) business days prior to the Closing Date, elect to terminate this Agreement without liability to Purchaser, in which case Purchaser shall be entitled to a refund of the Performance Deposit.

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For the avoidance of doubt, the provisions of this Section 3.10.2 shall not apply to consents to assign contained in BIA Leases as such matters are to be handled exclusively pursuant to Article 14.  

4. CASUALTY LOSS.

4.1 Casualty Loss

.  If, prior to the Closing, any of the Assets are the subject of a condemnation or taking or substantially damaged or destroyed by fire, explosion, accident, act of the public enemy, act of God, or other similar event or occurrence, and the losses as a result of such individual occurrence or taking exceed $40,000 (“ Casualty Loss ”), Seller shall notify Purchaser promptly after Seller learns of such event.  Seller shall have the right, but not the obligation, to cure any such Casualty Loss by repairing such damage or, in the case of Personal Property or fixtures, replacing the damaged Assets with equivalent items, in each case reasonably acceptable to Purchaser, no later than the Closing Date.  If any Casualty Loss exists at the Closing, Purchaser shall proceed to purchase the damaged Assets, and the Purchase Price shall be reduced by the aggregate reduction in value of all Assets affected by such Casualty Loss, as determined by the mutual agreement of the Parties; provided that if the Parties are unable to agree on such amount prior to the Closing, then such determination shall be made by the Defect

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Expert as provided in Section  3.9 a bove; provided, however, that if the Purchase Price reduction on account of such Casualty Loss reasonably claimed by Purchaser is an amount equal to or greater than the Allocated Value of the affected Assets, either Party shall have the option to exclude s uch Assets from the transaction, in which case such Assets will be retained by Seller at Closing, considered Excluded Assets for all purposes hereunder, and the Purchase Price will be reduced by the Allocated Value of the Assets so excluded without regard to the Individual Title Threshold or Aggregate Title Deductible.  Notwithstanding anything to the contrary contained in this Section  4.1 , Seller shall be entitled to retain all insurance proceeds and claims against other parties relating to any such Casualty Loss.  For purposes of this provision, normal wear and tear shall not be considered a Casualty Loss.

5. ENVIRONMENTAL CONDITION

5.1 Physical Condition of the Assets

.  The Assets have been used for Hydrocarbon drilling and production operations and various related oil field operations.  Physical changes in or under the Properties or adjacent lands may have occurred as a result of such uses.  The Properties also may contain buried pipelines and other equipment, whether or not of a similar nature, the locations of which may not now be known by Seller or be readily apparent by a physical inspection of the Property.  Purchaser understands that Seller may not have the requisite information with which to determine the exact nature or condition of the Properties or the effect any such use has had on the physical condition of the Assets.  In addition, Purchaser acknowledges that some oil field production equipment may contain asbestos and/or naturally occurring radioactive material (“ NORM ”).  In this regard, Purchaser expressly understands that NORM may affix or attach itself to the inside of wells, materials, and equipment as scale or in other forms, and that the wells, materials, and equipment located on the Assets may contain NORM and that NORM containing materials may be buried or have been otherwise disposed of on the Assets.  Purchaser also expressly understands that special procedures may be required for the removal and disposal of asbestos and NORM from the Assets where it may be found. The statements in this Section 5.1 are intended as disclosures of possible conditions existing on the Properties and not an admission or acknowledgment that any such conditions actually exist.

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5.3 Environmental Defect Notice

.  If Purchaser, in its sole discretion, determines, as a result of Purchaser’s Environmental Assessment, that there exists or may exist an Environmental Defect, Purchaser may notify Seller thereof in writing as soon as reasonably practical after its discovery, but in any event before the end of the Due Diligence Period (the “ Environmental Defect Notice ”).  Any notice provided hereunder shall state with reasonable specificity the basis of the alleged Environmental Defect and include evidence to support Purchaser’s position, including (i) a description of the Environmental Defect, (ii) the Environmental Law applicable to the Environmental Defect, (iii) Purchaser’s basis for believing that Seller is in violation of such Environmental Law, (iv) the portion of the Assets affected by the Environmental Defect and (v) a description of the proposed methods and scope of the Remediation (as hereinafter defined) required and the proposed Remediation Amount (as hereinafter defined) attributable thereto, and the assumptions relied upon by Purchaser or Purchaser’s Environmental Consultant in preparing such summary and estimate; provided, however, that an alleged failure to comply with subsections (i) through (v) shall not cause any such notice to be invalid or any Environmental Defect to be waived if the Environmental Defect Notice is reasonably sufficient (A) to provide notice to Seller of the existence and general nature of the Environmental Defect and (B) for Seller to verify the existence of the alleged Environmental Defect.  Except for Seller’s indemnification under Section 13.3.3 for breaches of Seller’s representations in Section 6.2.10 and Section 6.2.16, Purchaser will be deemed to have conclusively waived any Environmental Defect discovered by Purchaser during the Due Diligence Period and with respect to which Purchaser fails to timely and properly furnish to Seller an Environmental Defect Notice.

5.4 Remedies for Environmental Defects

.  For any Environmental Defect properly asserted by Purchaser during the Due Diligence Period, subject to the termination rights of Seller and Purchaser pursuant to Section 3.8 and subject to Seller’s rights in Section 5.5.1, Seller shall have the option, in its sole discretion, by written notice to Purchaser which shall be delivered on or prior to the date that is two (2) business days prior to Closing, of (i) remedying the Environmental Defect or (ii) reducing the Purchase Price by an amount equal to the proposed Remediation Amount (“ Environmental Defect Adjustment ”), subject to the limitation set forth in Section 5.5.3; provided, that if the asserted Environmental Defect Adjustment for any Property exceeds the Allocated Value for such Property, Seller or Purchaser shall have the option of removing the affected Property from the transaction contemplated herein and reducing the Purchase Price by the Allocated Value thereof and such Assets shall be Excluded Assets for all purposes hereunder.  In the event Seller elects option (i) above, then the Property affected by the asserted Environmental Defect shall be conveyed to Purchaser at Closing without adjustment to the Purchase Price and the Remediation Amount Purchaser reasonably asserted in its Environmental Defect Notice shall be deposited with the Escrow Agent, which amount shall be disbursed pursuant to Sections 5.5.2 and 3.9.

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The gas imbalances listed in Schedule 6.2.8, if any, have been taken into account in determining the Purchase Price.  Notwithstanding anything else to the contrary contained herein, Purchaser’s sole and exclusive remedy with respect to any breach of the representation and warranty contained in this Section 6.2.8 shall be an adjustment to the Purchase Price at the Closing or in the Post-Closing Adjustment Statement.

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6.3 Knowledge

.  As used in this Agreement, words “to Seller’s knowledge,” “to the knowledge of Seller,” or other words of similar import mean that the statement so qualified is true to the actual knowledge of the individuals listed on Schedule 6.3, without further investigation or inquiry.  In connection with matters relating to Assets not operated by Seller, each and every such representation and warranty of Seller contained in this Article 6 shall be deemed to be qualified by the phrase, “to Seller’s knowledge”.

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7.2 Knowledge

.  As used in this Agreement, words “to Purchaser’s knowledge,” “to the knowledge of Purchaser,” or other words of similar import mean that the statement so qualified is true to the actual knowledge of the senior executive officers of Purchaser.

8. PRE-CLOSING OBLIGATIONS OF SELLER

8.1 Operations

.  From the date of this Agreement until the Closing (the “ Interim Period ”), to the extent Seller can exert influence over such matters, Seller will use reasonable commercial efforts to see that the Properties not operated by Seller are maintained in full force and effect and are operated in a good and workmanlike manner and in accordance with the terms and conditions of the applicable oil, gas, and mineral leases, Existing Contracts, and all Applicable Laws.  Seller, as to the portion of the Properties which Seller now operates, shall continue to operate the

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same in a good and workmanlike manner and in accordance with the terms and conditions of the applicable oil, gas and mineral leases, the Existing Contracts, and all Applicable Laws, until such operations are turned over to and become the responsibility of Purchaser.  However, Seller will not have any obligatio n to operate any portion of the Properties after the expiration of the Interim Period except as provided for in Section  8.3 .  Subject to the terms of Section  8.3 , Seller will pay its proportionate share of all costs and expenses incurred in connection with Properties for which invoices are received prior to the Closing Date. During the Interim Period, Seller will (a) to the extent Seller controls the operation of any of the Properties, maintain the lease equipment in the same condition, working order, and state of repair as currently exists, subject to ordinary wear and tear, (b) give prompt written notice to Purchaser of any written notice received or given by Seller with respect to any material breach by Seller or any other person of any of the Properties, Permits and Existing Contracts, (c) use commercially reasonable effor ts to pursue and collect accounts receivable and other receivables in a timely manner and in the ordinary course of business consistent with past practice, (d) give prompt written notice to Purchaser of (I) any written notice of any material damage to or d estruction of any of the Assets and (II) any written notice received by Seller or any of its Affiliates of any material claim asserting any tort or violation of Applicable Law or any investigation, suit, action or litigation by or before a Governmental Bod y that, in each case, relates to the Assets, and (e) use commercially reasonable efforts to maintain and keep the Properties and Permits in full force and effect; provided, that, Seller shall not be required to make payments, conduct drilling operations or undertake obligations in favor any third parties in order to do so.  During the Interim Period and thereafter until operations are transferred to Purchaser or the duly elected or appointed successor operator, without the prior written consent of Purchaser , Seller will not (i) cause the Properties to be developed, maintained or operated in a manner substantially inconsistent with prior operations, (ii) unless required by law, abandon any part of the Properties or plug any of the Wells, (iii) commence any op eration on the Properties anticipated to cost, as to Seller’s interest in the Properties, in excess of $250,000 per operation, except emergency operations, the outstanding AFE’s and other commitments described in Schedule  8.1 , and operations undertaken to avoid any penalty provision of any Existing Contract or order (with respect to emergency operations, Seller shall notify Purchaser of said emergency as soon as rea sonably practical), (iv) encumber (except for Permitted Encumbrances), convey or dispose of any part of the Properties (other than Personal Property and equipment replaced with items of comparable or superior quality and Hydrocarbons produced from the Prop erties in the ordinary course of business), (v) settle any suit or litigation or waive any claims or rights of value, in each case, attributable to the Assets, (vi) voluntarily relinquish its position as operator with respect to any Asset, (vii) reduce or terminate (or cause to be reduced or terminated) any insurance coverage now held by Seller or its Affiliates in connection with the Assets, (viii) voluntarily waive or release any material right with respect to any Asset or (ix) agree to any of the foregoi ng.

8.2 Contracts

.  During the Interim Period, Seller will not, without the prior written consent of Purchaser, enter into any agreement (i) that would be a Material Contract if existing on the date of this Agreement, or (ii) amending, modifying, or terminating any of the Material Contracts.

8.3 Compensation of Seller

.  With respect to those Properties operated by Seller, Seller shall operate such Properties for the benefit of Purchaser during the period from the Effective Date through the date(s) when the operation of such Properties is turned over to, and becomes

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the responsibility of, Purchaser or the duly elected or appointed successor operator (the “ Operations Period ”).  For the Operations Period, Seller shall be entitled to retain all amounts paid or owing t o Seller by non-operators pursuant to the terms of the existing operating or similar agreements or otherwise required by law.  For the period from the Closing Date until the date(s) when the operation of the Properties is turned over to and becomes the res ponsibility of Purchaser or the duly elected or appointed successor operator, Purchaser shall pay to Seller (i) an amount equal to (A) the overhead charge attributable to Seller’s Working Interest in each such Property that would be payable to the operator pursuant to the terms of existing operating or similar agreements or otherwise required by law if Seller were a non-operator, or (B) if Seller owns one hundred percent (100%) of the working interest in such Property, a per Month overhead charge equal to f ive thousand dollars ($5,000) per drilling well and one thousand dollars ($1,000) per producing well, all in accordance with the 1984 COPAS Onshore Model Accounting Procedure, which is hereby incorporated by reference and (ii) all reasonable and necessary expenses attributable to Seller’s Working Interest incurred by Seller in operating, protecting, and maintaining the subject Properties.  Any such charges and expenses described above shall be recovered by Seller as part of the Closing or post-Closing adjus tments, as appropriate.  Except in the event of an emergency, or as otherwise required pursuant to Section 8.1 , Seller will have no obligation to make capital expen ditures or extraordinary operating expenditures in connection with the Properties during the Operations Period. During the Operations Period, Seller shall incur no liability to Purchaser or any other person for, and Purchaser hereby releases Seller from, a ny Costs of any nature suffered or incurred by Purchaser or such other Person arising out of or in connection with the rendering by Seller of any operation of the Assets (including, without limitation, the incorrect payment of expenses, taxes, billings, de lay rentals, royalties, minimum royalties, payments required by any of the Properties, shut-in royalties or similar payments, or for any failure to pay any such payments through mistake or oversight), unless such Costs are the result of the gross negligenc e or willful misconduct of Seller.  

8.4 Permissions

.  During the Interim Period, Seller shall use reasonable efforts to obtain all permissions, approvals, and consents by Federal, state and local governmental authorities and others as may be required to consummate the transactions contemplated by this Agreement (excluding governmental permissions, approvals and consents which are customarily obtained after the assignment of an oil and gas interest which shall be the responsibility of Purchaser to obtain).

8.5 Defaults

.  Seller shall give prompt written notice to Purchaser of any notice of material default (or written threat of material default, whether disputed or denied by Seller) received or given by Seller subsequent to the Effective Date under any Existing Contract or any other instrument or agreement affecting the Properties to which Seller is a party or by which Seller or any of the Assets is bound.

8.6 Operatorship

.  It is understood that in most (if not all) of the operating agreements covering any of the Properties, Seller does not retain the right to transfer operation of such Properties that are the subject of such operating agreements to a purchaser of Seller’s interests.  Notwithstanding the foregoing, at the Closing Seller will execute and deliver to Purchaser such change of operator forms as may be required by the applicable Governmental Bodies reflecting Purchaser as successor operator; however, Purchaser shall be responsible for obtaining approval to succeed Seller as operator from both the non-operators of each such Property and from the

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applicable Governmental Body, provided that Seller shall use reasonable commercial efforts to assist Purchaser in securing the consent of all interested parties to Purchaser’s election as operator of all of the Propert ies for which Seller is the current operator, but in no event shall Seller be required to expend funds in connection therewith; and provided, further that Seller shall not have any liability or responsibility with respect thereto.  Purchaser shall have the right to obtain agreements from such interested parties after the earlier of (i) the Closing Date or (ii) the date on which the transaction contemplated by this Agreement has been publicly announced and thereafter during the Interim Period.

9. PRE-CLOSING OBLIGATIONS OF PURCHASER

9.1 Return of Data

.  If this Agreement is terminated for any reason whatsoever, Purchaser, at Seller’s request, shall destroy or return promptly to Seller all information and data furnished to Purchaser, its officers, employees, and representatives in connection with this Agreement or Purchaser’s investigation of the Assets, and Purchaser shall not retain any copies of such information or data.

9.2 Efforts

.  Purchaser shall use its reasonable commercial efforts to cause its representations and warranties under this Agreement to be true and correct on and as of the Closing.  

10. CONDITIONS OF SELLER TO CLOSING

The obligations of Seller to consummate the transactions contemplated by this Agreement are subject, at the option of Seller, to the fulfillment on or prior to the Closing Date of each of the following conditions:

10.1 Representations

.  The representations and warranties of Purchaser contained in this Agreement shall be true and correct in all material respects on the Closing Date as though made on and as of such date; provided, however, that for purposes of this Section 10.1, all qualifications relating to materiality contained in such representations and warranties shall be disregarded.

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10.2 Performance

.  Purchaser shall have performed in all material respects all obligations, covenants, and agreements hereunder and shall have complied in all material respects with all covenants and conditions contained in this Agreement to be performed or complied with by it at or prior to the Closing.

10.3 Governmental Consents

.  Purchaser shall have received all consents, authorizations, waivers, and approvals required to be obtained prior to the Closing by any Governmental Body under any Applicable Law concerning the transactions contemplated herein, except those approvals, waivers or consents that are customarily obtained after Closing.

10.4 Injunction

.  On the Closing Date, no injunction, order or award restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated by this Agreement or granting material damages in connection therewith, shall have been issued and remain in force.

10.5 Pending Matters

.  No suit, action, or other proceeding by a Governmental Body or other person shall be pending, or to the best of Seller’s knowledge, threatened which seeks substantial damages from Seller in connection with, or seeks to restrain, enjoin, or otherwise prohibit, the consummation of the transaction contemplated by this Agreement.

10.6 Title and Environmental Defects

. The sum of (i) amounts paid to the Escrow Agent attributed to Title Defects and Environmental Defects, (ii) adjustments to the Purchase Price attributable to Title Defects and Environmental Defects as to which the Parties have agreed to as of the Closing Date (including, without limitation, adjustments as to affected Properties removed from the transactions under this Agreement pursuant to Article 3 or Article 5), and (iii) adjustments to the Purchase Price attributed to preferential purchase rights in accordance with Section 3.10, Required Consents in accordance with Section 3.10 and Casualty Losses in accordance with Section 4.1 does not equal or exceed fifteen percent (15%) of the Purchase Price.

11. CONDITIONS OF PURCHASER TO CLOSING

The obligations of Purchaser to consummate the transaction contemplated by this Agreement are subject, at the option of Purchaser, to the fulfillment on or prior to the Closing Date of each of the following conditions:

11.1 Representations

.  The representations and warranties of Seller contained in this Agreement shall be true and correct in all material respects on the Closing Date as though made on and as of such date; provided, however, that for purposes of this Section 11.1, all qualifications relating to materiality contained in such representations and warranties shall be disregarded.

11.2 Performance

.  Seller shall have performed in all material respects all obligations, covenants, and agreements hereunder and shall have complied in all material respects with all covenants and conditions contained in this Agreement to be performed or complied with by Seller at or prior to the Closing.

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11.3 Governmental Consents

.  Seller shall have received all consents, authorizations, waivers, and approvals required to be obtained prior to the Closing by any Governmental Body under any Applicable Law concerning the transactions contemplated herein, except those approvals, waivers or consents that are customarily obtained after the Closing.

11.4 Injunction

.  On the Closing Date, no injunction, order or award restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated by this Agreement or granting material damages in connection therewith, shall have been issued and remain in force.

11.5 Pending Matters

.  No suit, action, or other proceeding by a Governmental Body or other person shall be pending or, to the best of Purchaser’s knowledge, threatened which seeks substantial damages from Purchaser in connection with, or seeks to restrain, enjoin, or otherwise prohibit, the consummation of the transactions contemplated by this Agreement.

11.6 Title and Environmental Defects

. The sum of (i)  amounts paid to the Escrow Agent attributed to Title Defects and Environmental Defects, (ii) adjustments to the Purchase Price attributable to Title Defects and Environmental Defects as to which the Parties have agreed to as of the Closing Date (including, without limitation, adjustments as to affected Properties removed from the transactions under this Agreement pursuant to Article 3 or Article 5), and (iii) adjustments to the Purchase Price attributed to preferential purchase rights in accordance with Section 3.10, Required Consents in accordance with Section 3.10 and Casualty Losses in accordance with Section 4.1 does not equal or exceed fifteen percent (15%) of the Purchase Price.

11.7 Release of Liens

. Other than Permitted Encumbrances, all liens, charges, mortgages and security interests, to the extent encumbering the Assets and put in place by Seller or its Affiliates for borrowed money, shall have been released.

12. CLOSING

12.1 Time and Place of the Closing

.  The consummation of the transactions contemplated by this Agreement (the “ Closing ”) shall occur at 10:00 a.m., Central Time, on November 13, 2017 (such date, or any subsequent date agreed to by the Parties pursuant to Section 12.2, the “ Closing Date ”).  The Closing shall take place electronically (by telephone conference, e-mail, fax, etc.) or, if necessary, at the offices of Seller in Oklahoma City, Oklahoma, or such other place as the Parties may agree upon.

12.2 Change of the Closing Date

.  The Closing Date may be extended only by mutual agreement of the Parties, with such mutually agreed date to become the Closing Date.

12.3 Calculation of Adjusted Purchase Price

.  Seller shall prepare, in accordance with the provisions of this Agreement, a statement (the “ Closing Adjustment Statement ”) setting forth the Preliminary Amount, including each adjustment to the Purchase Price made, to the best of Seller’s knowledge, in accordance with the terms of Section 2.4, calculated based on actual information available on the date such statement is prepared or estimates when actual information is not available.  Seller shall submit the Closing Adjustment Statement to Purchaser no later than two (2) business days prior to the Closing Date and shall include reasonable

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supporting documentation for the Closing Adjustment Statement.  If the Parties cannot agree on the Closing Adjustment Statement or the Preliminary Amount , the Closing shall occur as scheduled based on Seller’s good faith calculation of the Preliminary Amount with the difference between Seller’s and Purchaser’s calculation of the Preliminary Amount to be reconciled in connection with making post-closing adj ustments as provided in Section  13.1 .

12.4 Failure to Close

.  If the conditions precedent to the obligation of a Party to close the transactions contemplated herein have been satisfied or waived on or before the Closing Date, and such Party nevertheless fails or refuses to close, the Party failing or refusing to close shall be deemed to have breached the obligations it has undertaken hereunder to perform at the Closing, and shall be subject to the provisions of Article 15.

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12.6 Conveyance

.  The General Assignment shall be without representation or warranty of title, express or implied, except that Seller shall warrant and agree to defend Good and Defensible Title to the Assets against the lawful claims and demands of all persons claiming the same, or any part thereof, but limited to claims arising by, through, or under Seller but not otherwise, subject to and excepting all Permitted Encumbrances.  To the fullest extent allowed by Applicable Law and the applicable agreement with any third parties, Seller will give and grant to Purchaser, its successors and assigns, full power and right of substitution and subrogation in and to all special warranties of title by preceding owners, vendors, or others, given or made with respect to the Assets or any part thereof.

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13.2 Receipts and Credits

.  Except as otherwise provided in this Agreement, all monies, proceeds, receipts, credits, and income attributable to the Assets for all periods of time on and after the Effective Date shall be the sole property of Purchaser, and, to the extent received by any Seller after the Closing, Seller shall fully disclose, account for, and transmit the same promptly to Purchaser.  Except as otherwise provided in this Agreement, all monies, proceeds, receipts, credits, and income attributable to the Assets for all periods of time prior to the Effective Date shall be the sole property of Seller, and, to the extent received by Purchaser after the Closing, Purchaser shall fully disclose, account for, and transmit the same promptly to Seller.  Except as otherwise provided in this Agreement (including, without limitation, the Assumed Obligations expressly assumed by Purchaser), all Property Costs incurred by Seller prior to Closing and attributable to the Assets for periods of time prior to the Effective Date, regardless of when due

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or payable, shall be the sole obligation of Seller, and Seller shall prom ptly pay, or if paid by Purchaser, promptly reimburse Purchaser for, and hold Purchaser and its successors and assigns harmless from and against, the same.  Except as otherwise provided in this Agreement (including, without limitation, the Assumed Obligati ons expressly assumed by Purchaser), all costs, expenses, disbursements, obligations, and liabilities attributable to the Assets for periods of time on and after the Effective Date, regardless of when due or payable, shall be the sole obligation of Purchas er, and Purchaser shall promptly pay, or if paid by Seller, promptly reimburse Seller for, and hold Seller and its respective successors and assigns harmless from and against, the same.

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13.4 Disclaimers

.  PURCHASER’S OBLIGATIONS UNDER SECTIONS 13.3.1 AND 13.3.2 SHALL APPLY REGARDLESS OF THE FAULT OR NEGLIGENCE (OTHER THAN THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT) OF SELLER, INCLUDING STRICT OR STATUTORY LIABILITY OF SELLER UNDER ANY APPLICABLE LAW.  SELLER’S OBLIGATIONS UNDER SECTION 13.3.3 SHALL APPLY REGARDLESS OF THE FAULT OR NEGLIGENCE (OTHER THAN THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT) OF PURCHASER, INCLUDING STRICT OR STATUTORY LIABILITY OF PURCHASER UNDER ANY APPLICABLE LAW.

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13.6 Payment

.  Payments under this Article 13 and under any other indemnity provision of this Agreement shall be made as follows: if the Indemnifying Party is required to make any payment hereunder, the Indemnifying Party shall promptly pay the Indemnified Party the amount so determined.  If there should be a dispute as to the amount or manner of determination of any indemnity obligation owed hereunder, the Indemnifying Party shall nevertheless pay when due such portion, if any, of the obligation as shall not be subject to dispute.  Upon the payment in full of any claim, the Indemnifying Party shall be subrogated to the rights of the Indemnified Party against any person or other entity with respect to the subject matter of this claim.

13.7 Recording

.  As soon as practicable after the Closing, Purchaser shall file and record all counterparts of the General Assignment in the appropriate counties and, if necessary, with all relevant Governmental Bodies, and provide Seller, at Purchaser’s expense, with copies of all recorded counterparts of the General Assignment.

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13.8 Cooperation and Further Assurances

.  After the Closing, Seller and Purchaser agree to take such further actions and to execute, acknowledge, and deliver all such further documents as are necessary or useful in carrying out the purposes of this Agreement or of any document delivered pursuant to this Agreement, including, but not limited to, the execution of state change of operator forms and other required state regulatory filings.  Each Party also agrees to cooperate with each other by providing reasonable information which may be required by the other Party for the purpose of administering the Assets and preparing or reviewing the Post-Closing Adjustment Statement.

14. BUREAU OF INDIAN AFFAIRS LEASES

14.1 BIA Leases

.  Hydrocarbon Interests in oil, gas or minerals to which the Bureau of Indian Affairs (“ BIA ”), the Osage Agency, or any other entity associated with a Native American tribe is a lessor, party in interest, or under which such entity has a right to consent to assignment of the subject Hydrocarbon Interest (“ BIA Lease ”) will be subject to the following additional post-closing obligations pending approval of assignment of such BIA Lease.

14.2 BIA Lease Revenues

.  From closing until such time as the consent for the transfer of any BIA Lease has been granted as required under such BIA Lease (the “ Consent Interim Period ”), Purchaser authorizes Seller, in its reasonable business judgment, to market production from the BIA Lease on behalf of Purchaser, and to receive revenues from the oil or gas purchasers from such marketing efforts.  Seller shall remit to Purchaser the revenues received for production from the BIA Lease within fifteen (15) business days of Seller’s receipt of such revenues from oil and gas purchasers, net of severance Taxes and charges imposed by the purchaser.  Seller will continue to remit the royalty revenues due to the BIA or tribal entity and the Taxes due the state on the wells for which Seller receives 100% gross payment.  It is understood by and Purchaser that where royalty revenues are paid by the purchaser directly to the lessor under any BIA Lease, Seller will have no liability to Purchaser regarding distribution of revenue under the BIA Lease.

14.3 Operation of BIA Leases

.  During the Consent Interim Period, Seller will designate Purchaser to act as it contract operator of the BIA Leases.  The contract operation arrangement will terminate with respect to an individual BIA Lease when the consent to the assignment of the individual BIA Lease is granted, but will continue with respect to other BIA Leases until such time as the consent to the assignment all BIA Leases conveyed by Seller to Purchaser under the this Agreement has been granted.  At the end of the Consent Interim Period, Seller shall furnish to Purchaser any executed letter-in-lieu or transfer/division orders or such other transfer documents that may be required for notifying and amending purchaser records.  Final settlement of all revenues and expenses will be made in the post-closing as provided.  Nothing under the contract operation agreement between Seller and Purchaser will alter the indemnities or other obligations set forth in this Agreement.

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15.2 Effect of Termination

.  If this Agreement is terminated pursuant to Section 15.1 above, this Agreement shall become void and of no further force or effect (except for the provisions of the final sentence of Section ‎3.1 and Sections ‎5.2.2, ‎9.2, ‎17.10, and this Section ‎15.2, which shall continue in full force and effect).  If this Agreement is terminated pursuant to either Section ‎15.1.1 or Section 15.1.5, neither Party shall have any further liability to the other as the result of such termination.  If this Agreement is terminated by Seller pursuant to Section ‎15.1.2, Seller is ready, willing and able to close, and Purchaser is in material breach of this Agreement, then the Parties shall jointly instruct the Escrow Agent to release the Performance Deposit to Seller as liquidated damages pursuant to Section ‎2.3 as its sole remedy, with all other remedies being waived; provided, that if this Agreement is terminated for any other reason hereunder, the Parties shall jointly instruct the Escrow Agent to release the Performance Deposit to Purchaser.  If this Agreement is terminated by Purchaser pursuant to Section ‎15.1.3 and Seller has failed to exercise its best efforts to cause the conditions set forth in Article 11 to have been fulfilled on or before the Closing Date, then, in addition to the return of the Performance Deposit to Purchaser pursuant to the above, Seller shall deliver to Purchaser an amount equal to Five Million Nine Hundred Fifty Thousand Dollars ($5,950,000) within thirty (30) days of such termination as liquidated damages representing Purchaser’s sole remedy for Seller’s failure to consummate the transaction contemplated herein.  The Parties agree that the above amount is a reasonable sum considering all the circumstances existing on the date of this Agreement, including the relationship of the sum to the range of harm to Purchaser that reasonably could be anticipated and the anticipation that proof of actual damages would be costly or inconvenient.  Notwithstanding anything to the contrary contained in this Agreement, upon any termination of this Agreement pursuant to Section ‎15.1, Seller shall be free immediately to enjoy all rights of ownership of the Assets and to sell, transfer, encumber, or otherwise dispose of the Assets to any party without any restriction under this Agreement; and Purchaser shall be liable for all actual, incidental, and consequential damages (including, without limitation, lost profits) if it attempts to interfere in any way with any such enjoyment or action by Seller.

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16. TAXES

16.1 Apportionment of Ad Valorem and Property Taxes

.  Seller shall be allocated and shall bear all ad valorem taxes, real property taxes, Personal Property taxes, and similar Tax obligations (the “ Property Taxes ”) with respect to the Assets for any Tax period (or portion thereof) ending prior to the Effective Date.  Purchaser shall be allocated and shall bear all Property Taxes with respect to the Assets for any Tax period (or portion thereof) beginning on or after the Effective Date.  Property Taxes for any Tax period in which the Effective Date occurs shall be apportioned based on the number of days in such Tax period before and after the Effective Date, between Seller and Purchaser and, if already paid by Seller, an appropriate increase in the Purchase Price shall be made pursuant to Section 2.4.5.  If such Property Taxes are not already paid, but the Tax liability is known or can be reasonably estimated, then Seller’s portion of such Property Taxes shall be reflected as a Purchase Price adjustment pursuant to Section 2.4.12.  Purchaser shall pay or cause to be paid to the taxing authorities all Property Taxes of which it has knowledge not already paid relating to the Tax period in which the Effective Date occurs, and if appropriate adjustments to the Purchase Price pursuant to Section 2.4 were not made at the Closing or in connection with the Post-Closing Adjustment Statement, Purchaser shall invoice Seller (with copies of applicable Tax bills and assessments to confirm same) for Seller’s apportioned shares of such Property Taxes.  Seller shall pay to Purchaser its share of such Property Taxes within thirty (30) days of receipt of said notice.  Purchaser shall defend, indemnify, and hold Seller harmless with respect to the payment of such Property Taxes of which Purchaser has knowledge and which Purchaser is obligated to pay to the applicable taxing authorities (including any interest or penalties assessed thereon), provided Seller pays to Purchaser its share (as apportioned hereunder) within thirty (30) days of being properly invoiced (with accompanying documents to support the invoice) by Purchaser.  For the Tax period in which the Effective Date occurs, Seller agrees (i) to forward immediately to Purchaser copies of all Property Tax reports and returns received by Seller after the Closing and (ii) to provide Purchaser with appropriate information which is necessary for Purchaser to file any required Property Tax reports and returns.  For non-operated Properties, the Property Taxes will be allocated between Seller and Purchaser upon the receipt of joint interest billings in which such Property Taxes are charged.  Notwithstanding the foregoing, Seller or Purchaser may contest with the appropriate taxing authority the amount of or liability for any Property Tax apportioned to it pursuant to this Section 16.1.  The Party pursuing the contest shall indemnify the other Party from and against all Costs incurred by the other Party in connection with the contest, and upon final settlement or resolution of the contest, the economic burden of the contested Tax shall be adjusted among the parties in a manner consistent with the intent of this Section 16.1.

16.2 Sales Taxes

.  Purchaser shall pay, or cause to be paid, all sales, use, transfer, and similar Taxes, if any, resulting from the sale and transfer of the Assets to Purchaser hereunder (including without limitation, all applicable conveyance, transfer and recording fees, and real estate transfer stamps or Taxes imposed on the transfer of the Assets pursuant to this Agreement) and Purchaser shall indemnify and hold harmless Seller from any such Taxes and the reasonable expense, if any, of contesting the liability for such Taxes.  The Parties shall cooperate (including by the provision of exemption certificates, documentation to support an occasional or isolated sale exemption, or other evidence or documentation) to reduce the amount of any such Taxes.  At the Closing, Purchaser shall pay to Seller any such Taxes required to be collected and remitted

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by Seller, and Seller shall prepare and file all Tax returns required to be filed with respect to such Taxes.

16.3 Other Asset Taxes

.  All production, severance, excise, and other similar Taxes that are based upon production of, or income or revenues from, Hydrocarbons attributable to the Assets prior to the Effective Date shall be allocated to and borne by Seller, and all such Taxes relating to such production on or after the Effective Date shall be allocated to and borne by Purchaser. All sales, use, transfer, and similar Taxes arising from the acquisition or disposition of the Assets prior to the Effective Date shall be paid by Seller, and all such Taxes arising from the acquisition or disposition of the Assets on or after the Effective Date shall be paid by Purchaser.  The Party responsible for payment of such Tax shall prepare and file all Tax returns required to be filed in respect thereof. This Section 16.3 shall not apply to any Tax to the extent specifically otherwise provided elsewhere in this Agreement.

16.4 Income Taxes

.   Each Party shall be responsible for its own income, franchise and similar Taxes and each Party shall indemnify and hold harmless the other Party with respect to such Taxes for which it is liable.

16.5 Cooperation

.  Each Party shall cooperate with the other Party and provide the other Party with all information in its possession or to which it has access which may be reasonably required by the other Party in connection with the preparation of any Tax return relating to the Assets, the audit or examination of any such returns by any Tax authority, and the determination of or contest of any Tax relating to the Assets. Notwithstanding anything to the contrary in this Agreement, neither Party shall be required at any time to disclose to the other Party any Tax returns or other confidential Tax information except to the extent required by Applicable Law or court order.

16.6 Tax Indemnity

.  Seller shall indemnify and hold harmless Purchaser, and Purchaser shall indemnify and hold harmless Seller, in each case with respect to the payment of any Taxes for which the indemnifying Party is responsible pursuant to the provisions of this Article 16.    If a Party pays a Tax subject to indemnification by the other Party, the indemnifying Party shall promptly reimburse the payor Party, subject to any specific reimbursement terms provided elsewhere in this Agreement.

17. MISCELLANEOUS

17.1 Entire Agreement

.  This Agreement, the Confidentiality Agreement dated May 25, 2017, between Seller and Purchaser (the “ Confidentiality Agreement ”), the General Assignment, the documents to be executed pursuant to this Agreement, and the attached Exhibits and Schedules constitute the entire agreement between the Parties pertaining to the subject matter of this Agreement and supersede all prior agreements, understandings, negotiations and discussions of the Parties, whether oral or written, and there are no warranties, representations or other agreements between the Parties in connection with the subject matter of this Agreement except as specifically set forth herein or in documents delivered pursuant hereto.  No supplement, amendment, alteration, modification, or waiver of this Agreement shall be binding unless executed in writing by the Parties.

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17.2 Waiver

.  No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

17.3 Headings

.  The headings of articles and sections used in this Agreement are for convenience only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement.  References herein to articles, sections, exhibits, and schedules are to articles, sections, exhibits, and schedules to this Agreement unless expressly stated otherwise.

17.4 Assignment

.  Except as otherwise provided in Section 17.19, prior to the Closing, no Party shall assign all or any part of this Agreement, nor shall any Party assign or delegate any of its rights or duties hereunder, without the prior written consent of the other Party, not to be unreasonably withheld.  Any assignment made in a manner not permitted by this Section 17.4, and such purported assignee shall have no rights, directly or indirectly, to enforce the rights of its purported assignor under this Agreement.  Except as otherwise provided in this Section 17.4, this Agreement shall be binding upon and inure to the benefit of the Parties and their respective permitted successors, assigns, and legal representatives.  No assignment or designation shall relieve the assigning Party from any obligation hereunder unless expressly so agreed by the other Party.

17.5 No Third Party Beneficiaries

.  Nothing in this Agreement shall entitle any party other than Purchaser and Seller and their duly authorized successors or assigns (to the extent permitted by Section 17.4 above) to any claim, cause of action, remedy, or right of any kind.

17.6 Governing Law

.   This Agreement, the other documents delivered pursuant hereto, and the legal relations between the Parties shall be governed and construed in accordance with the laws of the State of Oklahoma applicable to agreements made and to be performed wholly within the State of Oklahoma.  The validity of the various assignments or conveyances affecting the title to the Assets (and the warranties of title thereunder) shall be governed by and construed in accordance with the laws of the jurisdictions in which the Assets are located.

17.7 Notices

.  Any notice, communication, request, instruction or other document required or permitted by this Agreement shall be given in writing by certified mail, return receipt requested, postage prepaid, or by prepaid air express, hand delivery, e-mail, or facsimile (except that notice given by facsimile or email shall be effective upon receipt only if received during normal business hours, and if received after normal business hours, such notice shall be deemed given at the commencement of normal business hours on the next business day) as follows:

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17.8 Execution in Counterparts

.  This Agreement may be executed in any number of counterparts, and each such counterpart shall be deemed to be an original instrument, but such counterparts together shall constitute for all purposes one agreement.

17.9 Expenses

.  Except as otherwise provided in this Agreement, each Party shall be solely responsible for all expenses incurred by it in connection with the transaction contemplated herein (including, without limitation, fees and expenses of its own counsel and accountants) and shall not be entitled to reimbursement therefor from the other Party.

17.11 Exhibits and Schedules

.  All references in this Agreement to Exhibits shall be deemed to be references to such Exhibits as the same may be amended and supplemented by mutual agreement of the Parties through and as of the Closing, and all such Exhibits, as amended and supplemented, are hereby incorporated into this Agreement by reference; provided, that each Party may withhold its agreement to any such amendments in its sole discretion.

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17.12 Publicit y ; Public Disclosure

.  From and after the date hereof, prior to making any press or other similar release or public announcements regarding the transactions contemplated by this Agreement or public disclosure regarding the existence of this Agreement, the contents hereof or the transactions contemplated hereby as required by applicable securities or other laws or regulations, or the applicable rules of any stock exchange having jurisdiction over the disclosure Party or its Affiliates, each Party shall, to the extent legally permissible, consult with the other Party regarding the proposed contents thereof, but no approval thereof shall be required.

17.13 Use of Seller’s Names

.  Purchaser agrees to use reasonable efforts, as soon as practicable after the Closing, but in any case no later than one hundred eighty (180) days after the Closing, to remove or cause to be removed from the Assets, to the extent it has knowledge of the existence of same, all names and marks used by Seller and all variations and derivatives thereof and logos relating thereto, and will not thereafter make any commercial use of such names, marks and logos.

17.14 Severability

.  If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of law or public policy, 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 contemplated transactions is not affected in any material adverse manner to either Party.  Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the contemplated transactions are fulfilled to the extent possible.

17.15 Affiliate

.  For purposes of this Agreement, the term “ Affiliate ” (whether capitalized or not) shall mean, when used with respect to a person or entity, any other person or entity (i) which directly or indirectly (through one or more intermediaries) controls, or is controlled by, or is under common control with, such first mentioned person or entity, or (ii) which beneficially owns, holds, or controls fifty percent (50%) or more of the interest of such first mentioned person or entity.  The term “ control ” (including the terms “ controlled by ” and “ under common control with ”) means the possession, directly or indirectly or as trustee or executor, of the power to direct or cause the direction of the management policies of a person or entity, whether through the ownership of stock, as trustee or executor, by contract or credit arrangement or otherwise.

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17.17 Attorney’s Fees

.  Any Party successfully pursuing a claim for the enforcement of any provision of this Agreement, including, without limitation, agreements of indemnity contained herein or any of the documents to be delivered pursuant hereto, shall be entitled to recover from the unsuccessful Party reasonable attorneys’ fees, court costs, and other expenses incurred by the successful Party in such action.

17.18 Certain Limitations

.   Seller and PURCHASER agree that, except for the liquidated damages specifically provided for in Section 2.3, AND THE POSSIBILITY OF THE RECOVERY BY SELLER OF INCIDENTAL AND CONSEQUENTIAL DAMAGES AS SPECIFICALLY PROVIDED IN SECTION 15.2, the recovery by either Party of any damages suffered or incurred by it as a result of any breach by the other Party of any of its representations, warranties, COVENANTS or obligations under this Agreement shall be limited to the actual damages suffered or incurred by the nonbreaching Party as a result of the breach by the breaching Party of its representations, warranties or obligations hereunder and in no event shall the breaching Party be liable to the nonbreaching Party for any indirect, consequential, special, exemplary or punitive damages (including, without limitation, any damages on account of lost profits or opportunities, business interruption or lost or delayed production) suffered or incurred by the nonbreaching Party as a result of the breach by the breaching Party of any of its representations, warranties or obligations hereunder.   For purposes of the foregoing, actual damages may, however, include indirect, consequential, special, exemplary or punitive damages to the extent (i) the injuries or losses resulting in or giving rise to such damages are incurred or suffered by a person which is not Seller or Purchaser, as applicable, or its Affiliates and (ii) such damages are

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recovered against Seller or Purchaser, as applicable, by a person which is not Seller or Purchaser, as applicable, or its Affiliates.  This Section  17.18 shall operate only to limit a Party’s liability and shall not operate to increase or expand any contractual obligation of a party hereunder or cause any contractual obligation of a party hereunder to sur vive longer than provided in Section  17.16 .

17.19 Exchange

.  Seller shall have the right to utilize all or part of the Assets and the sales proceeds therefrom as part of a Tax deferred exchange pursuant to Section 1031 of the IRC and applicable state and local Tax laws.  In connection with an exchange, and notwithstanding the terms of Section 17.4, all or part of Seller’s rights under this Agreement may be assigned, without the need for Purchaser’s consent, to an intermediary, escrow agent, trustee, or other exchange accommodation party, provided that such assignment shall not relieve Seller of its obligations to Purchaser hereunder.  Purchaser shall cooperate with Seller in effecting such an exchange, including, without limitation, the execution of escrow instructions and other instruments, provided that:  (i) the acquisition and exchange of any exchange property shall not impose upon Purchaser any additional financial obligation other than as set out in this Agreement; (ii) Purchaser shall have no obligation to become a holder of record title to any exchange property; (iii) Seller shall indemnify and hold Purchaser harmless from any and all Costs which Purchaser incurs or to which Purchaser may be exposed as a result of Purchaser’s participation in the contemplated exchange, including reasonable attorneys’ fees and costs of defense; (iv) the Closing shall not be delayed or affected by reason of such exchange nor shall the consummation or accomplishment of such exchange be a condition precedent or condition subsequent to Seller’s obligations under this Agreement; (v) Purchaser shall not, by this Agreement or acquiescence to such exchange, have its rights under this Agreement affected or diminished in any manner; and (vi) Purchaser shall not, by this Agreement or acquiescence to such exchange, be responsible for compliance with or deemed to have warranted to Seller that such exchange in fact complies with Section 1031 of the IRC or any state or local Tax law.  If any type of exchange contemplated by Seller should fail to occur prior to Closing, for whatever reason, the sale of the Assets shall nonetheless be consummated as provided herein.

17.20 Written Instructions

.  Each Party covenants and agrees that when any person becomes entitled to any distribution of the Performance Deposit or any Escrow Amount pursuant to any provision of this Agreement, each such Party shall promptly, and in any event within two (2) business days, execute and deliver to the Escrow Agent joint written instructions (a “ Joint Direction ”) setting forth the amounts to be distributed in accordance with this Agreement.  In furtherance and not in limitation of the foregoing, if any Party shall fail to execute and deliver a Joint Direction within the time period specified in this Section 17.20, any of Seller or Purchaser, as applicable, shall be entitled to receive the applicable distributions from the Escrow Agent promptly upon delivery to the Escrow Agent of a written instruction, order or judgment issued or entered by a court of competent jurisdiction setting forth the amount to be paid to such person.

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IN WITNESS WHEREOF, Purchaser and Seller have executed and delivered this Agreement as of the date first written above but effective as of the Effective Date.

SELLER :

Chaparral Energy, L.L.C., an Oklahoma limited liability company


By:
Name:   K. Earl Reynolds
Title:     Manager

Chaparral CO2, L.L.C., an Oklahoma limited liability company


By:
Name:   K. Earl Reynolds
Title:     Manager

Chaparral Real Estate, L.L.C., an Oklahoma limited liability company


By:
Name:   K. Earl Reynolds
Title:     Manager

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PURCHASER :

Perdure Petroleum, LLC, a Delaware limited liability company


By:
Name:
Title:

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Glossary of Defined Terms

“ AAA ” has the meaning given to it in Section 13.1.2 of the Agreement.

“ Additional Consideration ” has the meaning given to it in Section 2.2.1 of the Agreement.

“ Adjusted Purchase Price ” has the meaning given to it in Section 2.4 of the Agreement.

“ Affiliate ” has the meaning given to it in Section 17.15 of the Agreement.

“ Aggregate Title Deductible ” has the meaning given to it in Section 3.5.3 of the Agreement.

“ Aggregate Environmental Deductible ” has the meaning given to it in Section 5.5.3 of the Agreement.

“ Agreement ” has the meaning given to it in the introductory paragraph of this Agreement.

“ Allocated Value ” has the meaning given to it in Section 3.2.7 of the Agreement.

“ Applicable Laws ” has the meaning given to it in Section 5.6.1 of the Agreement.

“ Assets ” has the meaning given to it in Section 1.2 of the Agreement.

“ Assumed Obligations ” has the meaning given to it in Section 13.3.1 of the Agreement.

“ BIA Lease(s) ” has the meaning given to it in Section 14.1 of the Agreement.

“ Casualty Loss ” has the meaning given to it in Section 4.1 of the Agreement.

“ CERCLA ” is defined in Section 5.6.3 of the Agreement.

“ Claim Notice ” has the meaning given to it in Section 13.5.1 of the Agreement.

“ Closing ” has the meaning given to it in Section 12.1 of the Agreement.

“ Closing Adjustment Statement ” has the meaning given to it in Section 12.3 of the Agreement.

“ Closing Date ” has the meaning given to it in Section 12.1 of the Agreement.

“ Confidentiality Agreement ” has the meaning given to it in Section 17.1 of the Agreement.

“ Consent Interim Period ” has the meaning given to it in Section 14.2 of the Agreement.

“ Control ,” “ controlled by ” and “ under common control with ” have the meanings given to them in Section 17.15 of the Agreement.

“ Costs ” has the meaning given to it in Section 3.1 of the Agreement.

“ Cure Period ” has the meaning given to it in Section 3.5.2.

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“ Customary Post-Closing Consents ” has the meaning given to it in Section  3.2.2(iii) of the Agreement.

“ Decision Notice ” has the meaning given to it in Section 3.9.2 of the Agreement.

“ Defect Expert ” has the meaning given to it in Section 3.9.1 of the Agreement.

“ Due Diligence Period ” has the meaning given to it in Section 3.3 of the Agreement.

“ Easements ” has the meaning given to its in Section 1.2.10 of the Agreement.

“ Effective Date ” has the meaning given to it in Section 1.3 of the Agreement.

“ Environmental Defect ” has the meaning given to it in Section 5.6.2 of the Agreement.

“ Environmental Defect Adjustment ” has the meaning given to it in Section 5.4 of the Agreement.

“ Environmental Defect Notice ” has the meaning given to it in Section 5.3 of the Agreement.

“ Environmental Laws ” has the meaning given to it in Section 5.6.3 of the Agreement.

“ Environmental Obligations ” has the meaning given to it in Section 13.3.1 of the Agreement.

“ Escrow Agent ” has the meaning given to it in Section 2.3 of the Agreement.

“ Escrow Amount ” has the meaning given in Section 2.5 of the Agreement.

“ Existing Contracts ” has the meaning given to it in Section 1.2.3 of the Agreement.

“ Final Settlement Date ” has the meaning given to it in Section 13.1.3 of the Agreement.

“ Form 8594 ” has the meaning given to it in Section 2.6 of the Agreement.

“ Gas Imbalance Adjustment ” has the meaning given to it in Section 13.1.4 of the Agreement.

“ General Assignment ” has the meaning given to it in Section 12.5.1 of the Agreement.

“ Good and Defensible Title ” has the meaning given to it in Section 3.2.1 of the Agreement.

“ Governmental Body ” has the meaning given to it in Section 5.6.4 of the Agreement.

“ Hedge Contract ” means any contract to which Purchaser or any of its Affiliates is a party with respect to any swap, forward, future or derivative transaction or option or similar agreement, whether exchange traded, “over-the-counter” or otherwise, involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value of any similar transaction or any combination of these transactions.

“ Hedged Production ” has the meaning given to it in Section 2.2.1 of the Agreement.

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“ Hydrocarbon Interests ” has the meaning given to it in Section  1.2.1 of the Agreement.

“ Hydrocarbons ” has the meaning given to it in Section 1.2.2 of the Agreement.

“ Indemnified Party ” and “ Indemnifying Party ” have the meanings given to them in Section 13.5.1 of the Agreement.

“ Individual Environmental Defect Threshold ” has the meaning given to it in Section 5.6.5 of the Agreement.

“ Individual Title Defect Threshold ” has the meaning given to it in Section 3.2.4 of the Agreement.

“ Interest Addition ,” “ Interest Addition Notice ,” “ Interest Addition Rejection Notice ,” and “ Interest Addition Value ” have the meanings given to them in Section 3.7 of the Agreement.

“ Interim Period ” has the meaning given to it in Section 8.1 of the Agreement.

“ IRC ” and “ Code ” have the meanings given to them in Section 2.6 of the Agreement.

“ Joint Direction ” has the meaning given to it in Section 17.20 of the Agreement.  

“ Material Contracts ” has the meaning given to it in Section 6.2.9 of the Agreement.

“ Month ” means a calendar month.

“ Net Revenue Interest ” has the meaning given to it in Section 3.2.1 of the Agreement.

“ NORM ” has the meaning given to it in Section 5.1 of the Agreement.

“ Notice Period ” has the meaning given to it in Section 13.5.1 of the Agreement.

“ Oil and Gas Properties ” shall mean the Properties, Units and Wells.

“ Operations Period ” has the meaning given to it in Section 8.3 of the Agreement.

“ OSHA ” has the meaning given to it in Section 5.6.3 of the Agreement.

“ Party ” and “ Parties ” have the meanings given to them in the introductory paragraph of the Agreement.

“ Performance Deposit ” has the meaning given to it in Section 2.3 of the Agreement.

“ Permitted Encumbrances ” has the meaning given to it in Section 3.2.2 of the Agreement.

“ Permits ” shall mean any permits, licenses, certificates of authority, franchises, concessions, registrations, consents or similar qualifications or authorizations issued, granted or given by or under authority of any Governmental Body.

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“ Personal Property ” has the meaning given to it in Section  1.2.5 of the Agreement.

“ Pipeline Assets ” has the meaning given to it in Section 1.2.5 of the Agreement.

“ Plugging and Abandonment ” has the meaning given to it in Section 13.3.1 of the Agreement.

“ Post-Closing Adjustment Statement ” has the meaning given to it in Section 13.1.1 of the Agreement.

“ Preliminary Amount ” has the meaning given to it in Section 2.5 of the Agreement.

“ Properties ” and “ Property ” have the meaning given to them in Section 1.2.1 of the Agreement.

“ Property Costs ” all operating expenses (including costs of insurance), overhead charges under applicable operating agreements and capital expenditures (including rentals, options and other lease maintenance payments, broker fees and other property acquisition costs and costs of acquiring equipment), respectively, incurred in the ordinary course of business attributable to the use, operation, and ownership of the Assets, but excluding Costs attributable to (a) claims, investigations, administrative proceedings, arbitration or litigation directly or indirectly arising from personal injury or death, property damage, torts, breach of contract, improper calculation, reporting or payment of royalties or violation of any Applicable Law, (b) obligations relating to the abandonment or plugging of Wells, dismantling or decommissioning facilities, closing pits and restoring the surface around such Wells, facilities and pits, (c) Environmental Obligations, (d) obligations with respect to imbalances, (e) obligations to pay royalties or other interest owners revenues or proceeds relating to the Assets but held in suspense, including suspense funds, (f) title claims (including claims that the Properties have terminated), and (g) claims for indemnification or reimbursement from any third party with respect to costs of the types described in the preceding clauses (a) through (g), whether such claims are made pursuant to contract or otherwise.

“ Property Taxes ” has the meaning given to it in Section 16.1 of the Agreement.

“ Purchase Price ” has the meaning given to it in Section 2.2 of the Agreement.

“ Purchaser ” has the meaning given to it in the introductory paragraph of this Agreement.

“ Purchaser Group ” has the meaning given to it in Section 5.2.2 of the Agreement.

“ Purchaser’s Actual Production ” has the meaning given to it in Section 2.2.1 of the Agreement.

“ Purchaser’s Environmental Assessment ” and “ Purchaser’s Environmental Consultant ” have the meanings given to them in Section 5.2.1 of the Agreement.

“ RCRA ” is defined in Section 5.6.3 of the Agreement.

“ Records ” has the meaning given to it in Section 1.2.13 of the Agreement.

“ Rejection Notice ” has the meaning given to it in Section 3.5.1 of the Agreement.

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“ Remediation ” has the meaning given to it in Section  5.6.6 of the Agreement.

“ Remediation Amount ” has the meaning given to it in Section 5.6.7 of the Agreement.

“ Required Consent ” a consent by a third party that, if not obtained prior to the assignment of Asset, expressly either (i) voids or nullifies the assignment with respect to such Asset, (ii) terminates Seller’s interest in the Asset subject to such consent or (iii) results in a breach that makes Purchaser or Seller liable for a material amount of damages; provided, however, that “Required Consent” does not include any (A) consent which by its terms cannot be unreasonably withheld or any Customary Post-Closing Consent, or (B) consent contained in any BIA Lease.

“ Retained Liabilities ” has the meaning given to it in Section 13.3.4 of the Agreement.

“ SARA ” is defined in Section 5.6.3 of the Agreement.

“ Seller ” has the meanings given to them in the introductory paragraph of this Agreement.

“ Seller Group ” has the meaning given to it in Section 3.1 of the Agreement.

“ Tax ” shall mean (i) all taxes, assessments, duties, levies, imposts or other similar charges imposed by a Governmental Authority, including all income, franchise, profits, capital gains, capital stock, transfer, gross receipts, sales, use, transfer, service, occupation, ad valorem, property, excise, severance, windfall profit, premium, stamp, license, payroll, employment, social security, unemployment, disability, environmental (including taxes under Code Section 59A), alternative minimum, add-on, value-added, withholding (including backup withholding) and other taxes, assessments, duties, levies, imposts or other similar charges of any kind whatsoever (whether payable directly or by withholding and whether or not requiring the filing of a Tax Return), and all estimated taxes, deficiency assessments, additions to tax, penalties, fines, interest, or additional amounts imposed by any Governmental Authority with respect thereto, and (ii) any liability described in clause (i) of any other Person that is imposed upon Seller as transferee or successor, by contract or otherwise, or as a result of being a member of an affiliated, consolidated, combined, or unitary group.

“ Title Defect ” has the meaning given to it in Section 3.2.3 of the Agreement.

“ Title Defect Adjustment ” has the meaning given to it in Section 3.4 of the Agreement.

“ Title Defect Amount ” has the meaning given to it in Section 3.2.6 of the Agreement.

“ Title Defect Notice ” has the meaning given to it in Section 3.3 of the Agreement.

“ Title Defect Property ” has the meaning given to it in Section 3.2.5 of the Agreement.

“ Units ” has the meaning given to it in Section 1.2.4 of the Agreement.

” Wells ” has the meaning given to it in Section 1.2.5 of the Agreement.

“ Working Interest ” has the meaning given to it in Section 3.2.1 of the Agreement.

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