Exhibit 10.1  

PURCHASE AND SALE AGREEMENT

This Agreement (“ Agreement ”) is executed on October 3, 2017 (the “ Execution Date ”) by and between ENERGY ONE LLC, a Wyoming limited liability company and a wholly-owned subsidiary of U.S. Energy Corp. (“ Seller ”), and STATOIL OIL & GAS LP, a Delaware limited partnership (“ Buyer ”). Each of Seller and Buyer is sometimes referred to herein as a “ Party ” and collectively as the “ Parties ”.

RECITALS

A.       Seller owns certain non-operated interests in certain oil and gas leases, wells, units and associated assets which are currently operated by Buyer.

B.       Buyer alleges that Seller owes and has not paid to Buyer expenses and revenue incurred or to be incurred in connection with: (i) that certain Drilling Participation Agreement dated August 24, 2009 between Seller and Buyer and corresponding joint interest billings for the development and operation of the Assets (defined below); (ii) operating agreements between Seller and Buyer for the development and operation of the Assets and corresponding joint interest billings; (iii) the development and operation of the Assets in accordance with the North Dakota Century Code (“NDCC”) ch. 38-08 and corresponding joint interest billings; and (iv) any and all past, present or future revenue due or owed in connection with the Assets (collectively, the “ Outstanding Seller Obligations ”).

C.       Seller alleges that Buyer owes and has not paid to Seller amounts due as to: (i) incorrect joint interest billings; (ii) audits conducted for 2010 and 2011; (iii) overcharges for lease operating expenses; (iv) unassigned overriding royalty interests; and (v) any and all past, present or future revenue due or owed in connection with the Assets (collectively, the “ Outstanding Buyer Obligations ” and together with the Outstanding Seller Obligations are referred to herein as the “ Outstanding Obligations ”).

D.       Any and all contracts, agreements, requirements under the NDCC, and any other governing obligations between the Parties in connection with the Assets are collectively referred herein as the “ Governing Agreements ” including, but not limited to the agreements specifically listed on Exhibit C .

E.       Pursuant to the terms and conditions of this Agreement, Seller desires to sell, and Buyer desires to purchase, the Assets (as defined below) in exchange for : (i) Buyer’s delivery of the Purchase Price (defined below), (ii) the Parties’ mutual release and waiver of the Outstanding Obligations, (iii) the termination of any and all Governing Agreements between the Parties relating to the Assets, (iv) the Parties’ mutual release and waiver from the any and all obligations and claims relating to the Governing Agreements, and (v) the Parties’ mutual release and waiver of any and all audit rights or privileges (collectively, the “ Consideration ”).

AGREEMENT

In consideration of the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller agree as follows:

1.        Purchase and Sale; Effective Date . Seller agrees to sell and Buyer agrees to purchase the Assets, (as such term is defined below and in the form of Assignment, Bill of Sale and Conveyance attached hereto as Exhibit B (the “ Assignment ”)), pursuant to the terms of this Agreement. The Assets include, without limitation, all of Seller’s right, title and interest in and to certain Wells (as defined below), Leases (as defined below) and Units (as defined below) located on and covering the lands (“ Lands ”) as described on Exhibit A . The purchase and sale of the Assets shall be effective as of August 1, 2017, at 12:01 a.m. local time at the site of the Assets (the “ Effective Date ”).

2.        Purchase Price . Buyer shall deliver a cash payment equal to Two Million Dollars and No/100 ($2,000,000.00) by bank wire in immediately available funds (the “ Purchase Price ”), and the Parties shall comply with terms of this Agreement to fully satisfy the Consideration for this transaction.

3.        Assets. The interest in and to the real property and the other types of property associated therewith as described in this Section 3(a) is referred to collectively as the “ Assets .” The Assets are comprised of the following:

(i)          all oil, gas and/or other Hydrocarbon (as defined below) leases, subleases, fee interests, reversionary leases, carried interests and other mineral interests, including, without limitation all such interests and leases and any leasehold estates, royalty interests, overriding royalty interests, production payments, net profits interests and other rights and interests to the oil and gas in place covered by such leases, whether listed or inadvertently omitted (the “ Leases ”) described on Exhibit A-1 , INSOFAR AND ONLY INSOFAR as such Leases relate to the Lands described on Exhibit A , and any pooled acreage, communitized acreage or units arising on account of the Leases, or Lands being pooled, communitized or unitized into units (the “ Units ”);

(ii)         all oil, gas, casinghead gas, coal bed methane, condensate and other gaseous and liquid hydrocarbons or any combination thereof, sulphur extracted from hydrocarbons and all other minerals and substances covered by the Leases (“ Hydrocarbons ”) under the Leases and that may be produced and saved under or otherwise be allocated or attributed to the Leases;

(iii)        all oil, gas, water or injection wells located on the Lands or the Leases, whether producing, shut-in or temporarily abandoned, or any future wells (but excluding permanently plugged and abandoned wells), (the “ Wells ”, and, together with the Leases, the Lands, the Units and the Hydrocarbons, are collectively referred herein as the “ Subject Interests ”), and including all of the personal property, Equipment (as defined below), fixtures and improvements used in connection therewith;

(iv)       all presently existing unitization, pooling and/or communitization agreements, declarations, orders or designations and statutorily, judicially or administratively created drilling, spacing and/or production units, and all of Seller’s interest in and to the properties covered or units created thereby which are attributable to the Subject Interests;

(v)         all equipment, machinery, fixtures and other tangible personal property and improvements located on or used or held for use in connection with the operation of the Subject Interests or the production, gathering, treatment, processing, storage, sale, disposal and other handling of Hydrocarbons attributable thereto, including any wells, well equipment, tanks, boilers, buildings, fixtures, injection facilities, saltwater disposal facilities, compression facilities and equipment, pumping units and engines, platforms, flow lines, pipelines, gathering systems, gas and oil treating facilities, machinery, power lines, telephone and telegraph lines, affixed communication equipment, roads and other appurtenances, improvements and facilities (all of the foregoing, collectively, the “ Equipment ”);

(vi)        all easements, permits, orders, authorizations, licenses, servitudes, rights of way, and all other rights and appurtenances situated on or used in connection with the Subject Interests or the Equipment (the “ Rights of Way ”);

(vii)       all presently existing and valid contracts, agreements and instruments insofar as such contracts, agreements and instruments cover, bind, are attributable to or relate to the Subject Interests, including, without limitation: farmin and farmout agreements; bottomhole agreements; crude oil, condensate and natural gas purchase and sale agreements; gathering, transportation, exchange and marketing agreements; hydrocarbon storage agreements; acreage contribution agreements; operating agreements; balancing agreements; pooling declarations or agreements; equipment leases, unitization agreements; processing agreements; balancing agreements, road use agreements, service agreements, crossing agreements and other similar contracts and agreements, but excluding the Leases (the “ Contracts ”);

(viii)      all rights, benefits, claims and causes of action held by Seller in and to all representations, warranties, covenants and indemnities from predecessors in title to the Subject Interests, including the right to enforce such representations, warranties, covenants and indemnities against such predecessors in title; and

(ix)        to the extent owned or licensed by Seller and to the extent it can be licensed, sublicensed or transferred without payment of license or transfer fees, or to the extent Buyer agrees to pay a third party for applicable license or transfer fees, Seller’s right, title and interest in and to (or to the extent such right, title and interest may not be conveyed under any applicable restriction thereon, a license (exclusive to the extent permitted and in form and substance reasonably acceptable to Seller and Buyer) or sublicense (reasonably acceptable to the owner of the information, Seller and Buyer), as applicable) all geophysical and seismic and related technical data, relating to the Leases, the Lands or land pooled therewith, together with any accounting and tax records, well files, title opinions and any other books, records and data pertaining or relating to the Subject Interests (“ Records ”);

(x)         all rights, claims and causes of action of Seller relating to the Assets that are attributable to periods of time from and after the Effective Date (including claims for adjustments or refunds); and

(xi)        all Hydrocarbon production from or attributable to the Assets with respect to all periods from and after the Effective Date, and all proceeds attributable thereto.

(a)         Organization; Existence . Seller is a limited liability company duly formed and validly existing under the laws of the State of Wyoming. Seller has all requisite power and authority to own and operate its property (including, without limitation, the Assets) and to carry on its business as now conducted. Seller is duly licensed or qualified to do business as a foreign company and is in good standing in the State of North Dakota and in any other jurisdiction in which such qualification is required by law.

(b)         Authorization . Seller has full power and authority to enter into and perform this Agreement and the transactions contemplated herein. The execution, delivery and performance by Seller of this Agreement has been duly and validly authorized and approved by all necessary company action on the part of Seller. This Agreement constitutes, and the other documents delivered pursuant to this Agreement and to which Seller is a party will constitute when delivered, Seller’s legal, valid and binding obligations, enforceable against Seller in accordance with their respective terms, subject however to the effects of bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and similar laws relating to or affecting creditors’ rights, as well as to principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(c)         No Conflicts . The execution, delivery and performance by Seller of this Agreement and the consummation of the transactions contemplated hereby do not and will not: (i) conflict with or result in a breach of any provisions of the organizational documents or other governing documents of Seller, (ii) result in a default or the creation of any encumbrance or give rise to any right of termination, cancellation or acceleration under any of the terms, conditions or provisions of any lease, contract, note, bond, mortgage, indenture, license or other material agreement to which Seller is a party or (iii) violate any law applicable to Seller or any of the Assets.

(d)         Bankruptcy . There are no bankruptcy, reorganization or receivership proceedings pending, being contemplated by or, to Seller’s knowledge, threatened against it.

(e)         Broker’s Fees . Seller has not incurred any obligation for brokers, finders or similar fees for which any other party hereto would be liable.

(f)         No Restraining Litigation . There is no action, suit, proceeding, claim or investigation by any person, entity, administrative agency or governmental body pending or, to Seller’s knowledge, threatened in writing against it before any court or governmental agency that seeks substantial damages in connection with, or seeks to restrain, enjoin, materially impair or prohibit the consummation of all or part of the transaction contemplated in this Agreement.

(g)         Royalties . All rentals, royalties and other payments due under the Assets for which Seller is responsible for payment have been timely and properly paid, except those amounts held in suspense.

(h)         Taxes .

    (i)           With respect to all Taxes (as defined below) related to the Assets, (A) all reports, returns, statements (including estimated reports, returns or statements), and other similar filings (the “ Tax Returns ”) relating to the Assets required to be filed by Seller with respect to such Taxes have been timely filed with the appropriate Governmental Body in all jurisdictions in which such Tax Returns are required to be filed, (B) such Tax Returns are true and correct in all material respects and reflects all Taxes owed with respect to the Assets and (C) all Taxes reported or that under law should have been reported on such Tax Returns have been timely paid when due and not in arrears. With respect to all Taxes related to the Assets; (x) there is not currently in effect any extension or waiver of any statute of limitations of any jurisdiction regarding the assessment or collection of any such Tax as to Seller or its affiliates; (y) neither Seller nor its affiliates have received notice of any pending, proposed, asserted or threatened claim against Seller or its affiliates (which remains outstanding) from any applicable governmental authority for assessment of Taxes with respect to the Assets, and there are no audits, suits, proceedings, assessments, reassessments, deficiency claims, or other claims relating to any Taxes of Seller or its affiliates with any applicable governmental authority; and (z) there are no Tax liens on any of the Assets except for statutory liens for Taxes not yet due or that may be paid without penalty or interest. None of the Assets are subject to any tax partnership agreement that will be applicable to such Assets following the Closing, nor will any of the Assets be required to be treated by Buyer as held in an arrangement requiring a partnership income tax return to be filed under Subchapter K of Chapter 1 of Subtitle A of the Code. For purposes of this Agreement, “ Taxes ” shall mean any and all taxes which have or may become due and payable with respect to the Assets or any portion thereof, including all ad valorem, property, production, severance, excise and similar taxes and assessments based on or measured by ownership of the Assets or the production of Hydrocarbons or receipt of proceeds from the Assets.

   (ii)         Neither Seller nor any of its affiliates is a party to or bound by any Tax allocation, sharing or indemnity agreements or arrangements.

(i)        Foreign Person . Seller is not (i) a “foreign person” within the meaning of Sections 1445 and 7701 of the Code or (ii) an entity disregarded as separate from any other Person within the meaning of Section 301.7701-3(a) of the Treasury regulations promulgated in respect of the Code.

(j)        Compliance with Laws . To the knowledge of Seller, the Assets are in compliance in all material respects with the provisions and requirements of all laws of all governmental authorities having jurisdiction with respect to the Assets, or the ownership, development, maintenance, or use of any thereof; and Seller has not received any written notice from or entered into any arrangement with any governmental authority relating to any claimed violation of or noncompliance with, any law with respect to the Assets that remains unresolved or requires continued action.

(k)       Contracts and Surface Contracts . Seller has made available to Statoil all Contracts and Surface Contracts, as each such term is defined in the Assignment. Seller is not in default in any material respect under any Contract or any Surface Contract and no event, occurrence, condition or act has occurred that, with the giving of notice, the lapse of time or the happening of any other event or condition, would become a default or event of default in any material respect by Seller, except for any such defaults or events of default comprising the Seller Released Obligations.

(l)        Payments for Hydrocarbon Production . Seller is not obligated under any Contract for the sale of gas from the Assets containing a take-or-pay, advance payment, prepayment, or similar provision, or under any gathering, transmission, or any other contract or agreement with respect to any of the Assets to gather, deliver, process, or transport any gas without then or thereafter receiving full payment therefor.

(m)      Consents and Preferential Rights to Purchase . There are no preferential rights to purchase or consent requirements which may be applicable to the transactions contemplated by this Agreement, except for consents and approvals of governmental authorities that are customarily obtained after Closing.

(n)        Leases .

   (i)          Seller has made available to Buyer true and complete copies of each Lease and all amendments thereto in existence on the Execution Date described on Exhibit A-1 .

   (ii)         To the knowledge of Seller, the Leases are in full force and effect and all bonuses, rentals and royalties (including shut-in royalties) with respect to the Leases that have become due and payable as of the Execution Date have been duly paid (other than royalties held in escrow or suspense accounts).

(o)        Areas of Mutual Interest . To the knowledge of Seller, there are no area of mutual interest agreements by which the Assets are bound.

(p)        Equivalent Value . Seller hereby represents and warrants, and the Parties agree that: (i) the consideration given and to be exchanged by the Parties and to be received by Seller as provided in this Agreement (including, without limitation, the Purchase Price, assumption of obligations and release of obligations by the Parties pursuant to this Agreement), shall constitute a contemporaneous or substantially contemporaneous exchange of equivalent value for the Assets transferred by Seller to Buyer, (ii) Seller and Buyer entered into this Agreement in good faith, (iii) no Party requires any further information, facts, research, evidence, or third party analysis or opinion in connection with the Parties’ decision to execute this Agreement and (iv) no Party shall have the right to benefit in any manner, either directly or indirectly, from the assertion by any person or entity that the receipt by any Party to this Agreement of consideration to be exchanged pursuant to this Agreement, shall constitute or shall have constituted less than reasonably equivalent value for the consideration given pursuant to this Agreement, or a preferential payment with respect to any debts or obligations resolved pursuant to this Agreement.

(q)      Special Warranty of Title . Seller warrants and will defend title to the Assets set forth in Exhibit A and Exhibit A-1 , as applicable, unto Buyer from and against all persons claiming the Assets, or any part thereof, by, through or under Seller, but not otherwise.

(r)        Liens. There are no mortgages, liens or other encumbrances affecting or burdening the Assets, except as has been disclosed in writing by Seller to Buyer, including the liens securing the Seller’s obligations under the Credit Agreement dated as of July 30, 2010 between the Seller and Wells Fargo Bank, National Association, as subsequently amended and as assigned to APEG Energy II, L.P., a Texas limited partnership, of which said liens include but are not limited to the following, (i) that certain Mortgage, Mortgage-Collateral Real Estate Mortgage, Deed of Trust, Assignment of As-Extracted Collateral, Security Agreement, Fixture Filing and Financing Statement recorded October 8, 2010 as document number 408726 in McKenzie County, (ii) that certain First Amendment and Supplement to Mortgage, Mortgage-Collateral Real Estate Mortgage, Deed of Trust, Assignment of As-Extracted Collateral, Security Agreement, Fixture Filing and Financing Statement dated April 10, 2012 and recorded as document number 434082 in McKenzie County, (iii) that certain Memorandum of Assignment of Liens and Security Interests dated May 31, 2012 and recorded as document number 438242 in McKenzie County, (iv) that certain Second Supplement to Mortgage, Mortgage-Collateral Real Estate Mortgage, Deed of Trust, Assignment of As-Extracted Collateral, Security Agreement, Fixture Filing and Financing Statement dated August 11, 2016 and recorded as document number 494946 in McKenzie County, (v) that certain Master Assignment, Resignation and Appointment Agreement dated May 2, 2017 and recorded as document number 500708 in McKenzie County, (vi) that certain Mortgage, Mortgage-Collateral Real Estate Mortgage, Deed of Trust, Assignment of As-Extracted Collateral, Security Agreement, Fixture Filing and Financing Statement recorded August 13, 2010 as document number 694418 in Williams County; (vii) that certain Partial Release of Liens dated December 14, 2011 and recorded as document number 725298 in Williams County, (vii) that certain First Amendment and Supplement to Mortgage, Mortgage-Collateral Real Estate Mortgage, Deed of Trust, Assignment of As-Extracted Collateral, Security Agreement, Fixture Filing and Financing Statement dated April 10, 2012 and recorded as document number 733718 in Williams County, (viii) that certain Memorandum of Assignment of Liens and Security Interests dated May 31, 2012 and recorded as document number 741282 in Williams County, and (ix) that certain Master Assignment, Resignation and Appointment Agreement dated May 2, 2017 and recorded as document number 835506 in Williams County (all of the foregoing, collectively, the “ Lien ”).

(a)        Organization; Existence . Buyer is a limited partnership duly formed and validly existing under the laws of the State of Delaware. Buyer has all requisite power and authority to own and operate its property (including, without limitation, the Assets) and to carry on its business as now conducted. Buyer is duly licensed or qualified to do business as a foreign company and is in good standing in the State of North Dakota and in any other jurisdiction in which such qualification is required by law.

(b)        Authorization . Buyer has full power and authority to enter into and perform this Agreement and the transactions contemplated herein. The execution, delivery and performance by Buyer of this Agreement has been duly and validly authorized and approved by all necessary company action on the part of Buyer. This Agreement constitutes, and the other documents delivered pursuant to this Agreement and to which Buyer is a party will constitute when delivered, Buyer’s legal, valid and binding obligations, enforceable against Buyer in accordance with their respective terms, subject however to the effects of bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and similar laws relating to or affecting creditors’ rights, as well as to principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(c)        No Conflicts . The execution, delivery and performance by Buyer of this Agreement and the consummation of the transactions contemplated hereby does not and will not (i) conflict with or result in a breach of any provisions of the organizational documents or other governing documents of Buyer, (ii) result in a default or the creation of any encumbrance or give rise to any right of termination, cancellation or acceleration under any of the terms, conditions or provisions of any lease, contract, note, bond, mortgage, indenture, license or other material agreement to which Buyer is a party or (iii) violate any law applicable to Buyer or any of the Assets.

(d)        Bankruptcy . There are no bankruptcy, reorganization or receivership proceedings pending, being contemplated by or, to Buyer’s knowledge, threatened against it.

(e)        Broker’s Fees . Buyer has not incurred any obligation for brokers, finders or similar fees for which any other party hereto would be liable.

6.             Closing . The closing of the transactions contemplated hereby (the “ Closing ”) shall occur on the Execution Date remotely or at a time or place as the parties might hereafter mutually agree in writing. Such date or alternative date is referred to herein as the “ Closing Date ”.

7.             Closing Deliveries . At the Closing, the following events shall occur, each being a condition precedent to the others and each being deemed to have occurred simultaneously with the others:

(a)          Seller shall deliver to Buyer the following:

(v)          such other agreements provided for herein or necessary or reasonably desirable to effectuate the transactions contemplated hereby.

(b)          Buyer shall deliver to Seller, as applicable, the following:

8.             Tax Matters . Buyer shall be liable for, and shall indemnify and hold Seller harmless from, any sales and use taxes, conveyance, transfer and real estate transfer stamps or taxes that may be imposed on any transfer of the Assets pursuant to this Agreement. Buyer shall be responsible for such taxes from and after the Effective Date. Buyer shall be liable for, and shall indemnify and hold Seller harmless from, any severance or other production taxes assessed with respect to the Assets for all periods from and after the Effective Date.

9.             Released Obligations.

(a)       Seller hereby releases and waives Buyer, its respective affiliates, officers, directors, managers, shareholder, members, partners, employees, representatives, agents, beneficiaries, personal representatives, successors and assigns (the “ Buyer Released Parties ”) from any and all claims, demands, obligations, losses, causes of action, breach of contract, costs, audit rights, expenses, attorneys’ fees, and liabilities of any nature whatsoever, whether based upon contract, tort, strict liability, statutory, regulatory, or other legal or equitable theory of recovery, whether known or unknown, which either Party currently has, had, or claims to have had, against any or all of the Parties, which relate in any way to, or arise from, or are in any manner connected: (i) any obligation to pay the Outstanding Buyer Obligations, (ii) the Outstanding Obligations, and (iii) the Governing Agreements, including all provisions of the Governing Agreements intended to survive the termination of the Governing Agreements or bind the Parties in perpetuity (collectively, the “ Buyer Released Obligations ”).

(b)       Buyer hereby releases and waives Seller, its respective affiliates, officers, directors, managers, shareholder, members, partners, employees, representatives, agents, beneficiaries, personal representatives, successors and assigns (the “ Seller Released Parties ”) from any and all claims, demands, obligations, losses, causes of action, breach of contract, costs, audit rights, expenses, attorneys’ fees, and liabilities of any nature whatsoever, whether based upon contract, tort, strict liability, statutory, regulatory, or other legal or equitable theory of recovery, whether known or unknown, which either Party currently has, had, or claims to have had, against any or all of the Parties, which relate in any way to, or arise from, or are in any manner connected: (i) any obligation to pay the Outstanding Seller Obligations, (ii) the Outstanding Obligations, and (iii) the Governing Agreements, including all provisions of the Governing Agreements intended to survive the termination of the Governing Agreements or bind the Parties in perpetuity (collectively, the “ Seller Released Obligations ”).

(c)       This Agreement and all undertakings are not and may not in any way be construed or deemed to be evidence or an admission or a concession of any fault, liability or fact or any other matter whatsoever on the part of any Party to this Agreement in connection with the Buyer Released Obligations and the Seller Released Obligations.

10.          Termination of Governing Agreements . The Parties hereby terminate the Governing Agreements and release each other from all obligations thereof pursuant to this Agreement.

11.           Additional Post-Closing Obligations .

(a)       Records . At the Closing, Seller, at Buyer’s expense, shall make photocopies of the Records available for pick up by Buyer. Seller may retain its original copies of the Records.

(b)      Transfer and Recording Fees . Buyer shall submit all assignments and releases for filing or recording with the appropriate governmental or regulatory offices and shall pay all documentary, transfer, filing, licensing, and recording fees required in connection with the processing, filing, licensing or recording of all such documents.

(c)         Further Assurances . From time to time after the Closing Date, Seller and Buyer shall each execute, acknowledge and deliver to the other such further instruments and take such other action as may be reasonably necessary in order to more effectively assure to the other the full beneficial use and enjoyment of the Assets and otherwise to accomplish the purposes of the transactions contemplated by this Agreement.

(d)        Government Reviews and Filings . After the Closing Date, Seller and Buyer shall cooperate to provide requested information, make required filings with, prepare applications to and conduct negotiations with each governmental agency as required to consummate the transactions contemplated hereby. Each party shall make any governmental filings occasioned by its ownership or structure. Buyer shall make all filings after the Closing Date at its expense with governmental agencies necessary to transfer title to the Assets or to comply with laws.

12.            Liabilities; Indemnification .

(a)        Buyer’s Assumption of Liabilities and Obligations . Upon Closing, Buyer hereby assumes and agrees to pay, perform, fulfill and discharge all claims, losses, costs, expenses, liabilities (including, without limitation, civil fines), damages, demands, suits, sanctions and obligations of every kind and character, including, without limitation, reasonable fees and expenses of attorneys, technical experts and expert witnesses reasonably incident to matters indemnified (“ Claims ”): (i) accruing or relating to the owning, developing, exploring, operating or maintaining of the Assets and the producing, transporting and marketing of Hydrocarbons from the Assets, including, without limitation, costs to plug and abandon any Wells, in each case with respect to periods from and after the Effective Date only, except with respect to such Claims arising from or relating to Wilkinson v. Bd. of Univ. and Sch. Lands , N.D. Sup. Ct. No. 2016-0199, which Claims shall be so assumed by Buyer with respect to periods prior to and from and after the Effective Date; (ii) all obligations arising under the Contracts and agreements and affecting the Assets with respect to periods from and after the Effective Date only; and (iii) the Seller Released Obligations set forth in Section 9(b) (collectively, the “ Buyer Assumed Liabilities ”).

(b)        Buyer’s Indemnification of Seller . From and after the Closing, and subject to the limitations set forth in this Section 12 of this Agreement, Buyer hereby agrees to defend, indemnify and save and hold harmless Seller forever from and against all Claims which arise from or in connection with (i) the Buyer Assumed Liabilities, (ii) the breach or inaccuracy of any of Buyer’s representations or warranties under this Agreement, and/or (iii) any breach of Buyer’s covenants under this Agreement. Any provisions of this Agreement to the contrary, Buyer’s indemnification obligation under this Section 12 shall only apply if Seller has provided Buyer with written notice claiming indemnification within the period of survival set forth in this Section 12(e), and thereafter until fully resolved or adjudicated or barred by applicable statutes of limitations. Buyer shall be deemed to have released Seller on the Closing Date from any Claims for which Buyer has agreed to indemnify Seller hereunder.

(c)        Liabilities and Obligations Retained by Seller . Upon the Closing, Seller hereby retains and agrees to pay, perform, fulfill and discharge all Claims accruing or relating to (i) the owning, developing, exploring, operating or maintaining of the Assets and the producing, transporting and marketing of Hydrocarbons from the Assets, in each case with respect to periods before the Effective Date only; (ii) all obligations arising under the Contracts and agreements and affecting the Assets with respect to periods before the Effective Date only; (iii) all liabilities, costs, expenses, duties and obligations resulting from events arising prior to the Effective Date to restore or remediate the Assets or lands pooled or unitized therewith and any other obligations resulting from events arising prior to the Effective Date; and (iv) the Buyer Released Obligations set forth in Section 9(a) (collectively, the “ Seller Retained Liabilities ”).

(d)        Seller’s Indemnification of Buyer . Upon Closing under this Agreement, Seller shall defend, indemnify and save and hold harmless Buyer, its officers, directors, employees, representatives, agents, beneficiaries, personal representatives, successors and assigns forever from and against all Claims which arise from or in connection with (i) the Seller Retained Liabilities, (ii) the breach or inaccuracy of any of Seller’s representations or warranties under this Agreement or (iii) any breach of Seller’s covenants under this Agreement. Any provisions of this Agreement to the contrary, Seller’s indemnification obligation under this Section 12 shall only apply if Buyer has provided Seller with written notice claiming indemnification within the period of survival set forth in this Section 12(e), and thereafter until fully resolved or adjudicated or barred by applicable statutes of limitations. Seller shall be deemed to have released Buyer on the Closing Date from any Claims for which Seller has agreed to indemnify Buyer hereunder.

(e)        Survival . The representations, warranties, covenants, and indemnification of the Parties contained in this Agreement shall survive the execution and delivery of this Agreement for a period of two (2) years following the Closing Date.

(f)          Limitations .

(a)           Exhibits . The Exhibits referred to in this Agreement are hereby incorporated into this Agreement by reference and constitute a part of this Agreement.

(b)          Expenses . Except as otherwise specifically provided, all fees, costs and expenses incurred by Buyer or Seller in negotiating this Agreement or in consummating the transactions contemplated by this Agreement shall be paid by the party incurring the same, including, without limitation, legal and accounting fees, costs and expenses.

(c)           Notices . All notices and communications required or permitted under this Agreement shall be in writing and addressed as set forth below. Any communication or delivery hereunder shall be deemed to have been duly made and the receiving party charged with notice (i) if personally delivered, when received, (ii) if sent by certified mail, return receipt requested, three (3) days after sending, (iii) if sent by overnight courier, one day after sending, or (iv) if sent by facsimile transmission or electronic mail, when written confirmation is received. All notices shall be addressed as follows:

If to Buyer :

Statoil Oil & Gas LP

6300 Bridge Point Parkway

Suite 100

Austin, Texas 78730

Attn: Karen Keller

email: karke@statoil.com

With a copy to:

Statoil Oil & Gas LP

6300 Bridge Point Parkway

Suite 100

Austin, Texas 78730

Attn: Lexie Worley

email: lwor@statoil.com

If to Seller :

Energy One LLC

4643 S. Ulster Street

Suite 970

Denver, Colorado 80237

Attn: David A. Veltri, President

email: david@usnrg.com

With a copy to:

Kutak Rock LLP

1801 California Street

Suite 3000

Denver, Colorado 80202

Attn: Kenneth S. Witt, Esq.

email: Kenneth.witt@kutakrock.com

Any party may, by written notice so delivered to the other parties, change the address or individual to which delivery shall thereafter be made.

(d)         Amendment . Except for waivers specifically provided for in this Agreement, this Agreement may not be amended nor any rights hereunder waived except by an instrument in writing signed by the part to be charged with such amendment or waiver or in any form as agreed upon by the Parties and delivered by such party to the party claiming the benefit of such amendment or waiver.

(e)         Assignment . Neither Buyer nor Seller may assign this Agreement or any of its rights, interests, duties or obligations hereunder without the prior written consent of the other party, which consent may not be unreasonably withheld.

(f)         Announcements . There shall be no press release or other public announcement by Seller or Buyer concerning this Agreement or the transactions contemplated hereby, unless such press release or announcement is approved by Buyer and Seller in writing, or except as may be required by applicable laws or the applicable rules and regulations of any governmental agency or stock exchange.

(g)         Headings . The headings of the Articles and Sections of this Agreement are for guidance and convenience of reference only and shall not limit or otherwise affect any of the terms or provisions of this Agreement.

(h)         Counterparts . This Agreement may be executed by Buyer and Seller in any number of counterparts, each of which shall be deemed an original instrument, but all of which together shall constitute by one and the same instrument. Execution can be evidenced by facsimile transmission or electronic mail (in .pdf format) of signature pages with original signature pages to promptly follow in due course.

(i)         References . References made in this Agreement, including use of a pronoun, shall be deemed to include where applicable, masculine, feminine, singular or plural, individuals, partnerships or corporations. As used in this Agreement, “person” shall mean any natural person, corporation, partnership, court, agency, government, board, commission, trust, estate or other entity or authority.

(j)         Governing Law; Venue . This AGREEMENT AND THE Assignment SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS (OTHER THAN ITS CONFLICTS OF LAWS RULES THAT MIGHT DICTATE THE APPLICATION OF ANOTHER LAW OR JURISDICTION). ALL MATTERS LITIGATED BY, AMONG OR BETWEEN ANY OF THE PARTIES HEREUNDER THAT INVOLVE THIS AGREEMENT, THE ASSIGNMENT OR ANY RELATED DOCUMENTS OR MATTERS HEREUNDER SHALL BE BROUGHT ONLY IN HARRIS COUNTY, TEXAS, AND THE PARTIES HEREBY CONSENT TO THE EXERCISE OF JURISDICTION IN PERSONAM BY THE COURTS OF THE STATE OF TEXAS, COUNTY OF HARRIS, FOR ANY DISPUTE.

(k)         Entire Agreement . This agreement, together with the Assignment, constitutes the entire understanding among the parties, their respective partners, shareholders, officers, directors and employees with respect to the subject matter hereof, superseding all negotiations, prior discussions and prior agreements and understandings relating to such subject matter.

(l)         Binding Effect . This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto, and their respective successors and assigns.

(m)         No Third-Party Beneficiaries . Except as otherwise expressly provided herein, this Agreement is intended only to benefit the parties hereto and their respective permitted successors and assigns.

(n)         Confidentiality . The terms and conditions of this Agreement and all discussions between the Parties relating thereto shall remain confidential for twelve (12) months after the Closing Date, except as otherwise required by applicable law, regulation, or legal process or unless otherwise agreed to in writing by all Parties.

(o)         WAIVER OF TRIAL BY JURY . TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH THIS ASSIGNMENT WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AMONG THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS ASSIGNMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS WILL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.

(q)         Data . Seller shall destroy or provide all data in its possession to Buyer related to the Assets, except to the extent required for tax or accounting purposes and except as required by law, provided that the Seller will maintain said data as confidential.

[Signature Pages Follow]

THIS AGREEMENT IS EXECUTED as of the date first written above and effective for all purposes as of the Effective Date set forth above.

SELLER:

Energy One LLC

Purchase and Sale Agreement between Statoil Oil & Gas LP and Energy One LLC  

Signature Page

BUYER:

STATOIL OIL & GAS LP

By:  Statoil Oil & Gas Services Inc., its

general partner

Purchase and Sale Agreement between Statoil Oil & Gas LP and Energy One LLC  

Signature Page

LIST OF EXHIBITS AND SCHEDULES

Purchase and Sale Agreement between Statoil Oil & Gas LP and Energy One LLC  

List of Exhibits

Purchase and Sale Agreement between Statoil Oil & Gas LP and Energy One LLC

Exhibit A

Purchase and Sale Agreement between Statoil Oil & Gas LP and Energy One LLC

Exhibit A-1