PURCHASE AND SALE AGREEMENT BY AND BETWEEN MARITECH RESOURCES, INC. AS SELLER AND TANA EXPLORATION COMPANY LLC AS BUYER MARITECH 2011 DIVESTITURE PACKAGE OFFSHORE GULF OF MEXICO

Exhibit 10.3

PURCHASE AND SALE AGREEMENT

BY AND BETWEEN

MARITECH RESOURCES, INC.

AS SELLER

AND

▇▇▇▇ EXPLORATION COMPANY LLC

AS BUYER

MARITECH 2011 DIVESTITURE PACKAGE

OFFSHORE GULF OF MEXICO

TABLE OF CONTENTS

ARTICLE 1 SALE AND PURCHASE OF THE ASSETS	1
1.1 Acquired Assets	1
1.2 Excluded Assets	3
1.3 Ownership of Production from the Assets	5
ARTICLE 2 Purchase Price	5
2.1 Purchase Price	5
2.2 Deposit	5
ARTICLE 3 Purchase Price Adjustments	6
3.1 Adjustments to the Base Purchase Price	6
3.2 Closing Statement	8
3.3 Post-Closing Adjustments.	8
3.4 Imbalances	9
3.5 Allocation of Revenues and Expenses Upon Closing.	10
ARTICLE 4 BUYER’S DUE DILIGENCE	11
4.1 Access	11
4.2 Buyer’s Environmental Assessment	11
4.3 Buyer’s Indemnification of Seller	12
ARTICLE 5 TITLE MATTERS	12
5.1 Certain Definitions.	12
5.2 Notice of Title Defects	15
5.3 Remedies for Title Defects	15
5.4 Title Benefits	16
ARTICLE 6 ENVIRONMENTAL ASSESSMENT	16
6.1 Certain Definitions.	16
6.2 Notice of Adverse Environmental Conditions	17
6.3 Remedies for Adverse Environmental Conditions	17
ARTICLE 7 INDEPENDENT EXPERT.	18
7.1 Independent Expert	18
ARTICLE 8 Casualty loss	19
8.1 Casualty Losses and Government Takings	19
8.2 Remedies for Casualty Losses and Government Takings	19
8.3 Change in Condition	19
ARTICLE 9 PREFERENTIAL RIGHTS AND CONSENTS	20
9.1 Consents	20
9.2 Preferential Rights.	20
ARTICLE 10 REPRESENTATIONS AND WARRANTIES OF SELLER	21

10.1 Seller’s Representations and Warranties	21
10.2 Scope of Representations of Seller.	25
ARTICLE 11 REPRESENTATIONS AND WARRANTIES OF BUYER	27
11.1 Buyer’s Representations and Warranties	27
ARTICLE 12 INTERIM OPERATIONS	29
12.1 Interim Operations	29
12.2 Disposal Barge and Equipment	30
ARTICLE 13 CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS OF BUYER	30
13.1 No Litigation	30
13.2 Representations and Warranties; Covenants	30
13.3 Aggregate Adjustments Base to Purchase Price	30
ARTICLE 14 CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS OF SELLER	31
14.1 No Litigation	31
14.2 Representations and Warranties; Covenants	31
14.3 Aggregate Adjustments Base to Purchase Price	31
14.4 Buyer’s Qualification and Bonding	31
ARTICLE 15 CLOSING	31
15.1 Closing	31
15.2 Deliveries by Seller	31
15.3 Deliveries by Buyer. At Closing, Buyer shall deliver to Seller:	32
ARTICLE 16 TERMINATION	33
16.1 Termination	33
16.2 Effect of Termination	33
ARTICLE 17 BUYER’S POST-CLOSING BONDING AND INSURANCE OBLIGATIONS	33
17.1 Governmental Bonds	33
17.2 Supplemental Bonding Requirements	34
17.3 Insurance Coverages	34
ARTICLE 18 OTHER POST-CLOSING COVENANTS	35
18.1 Seller’s	35
18.2 Records	36
18.3 Operatorship	36
18.4 Suspended Funds	36
18.5 Notice of Transfer	36
18.6 Work Bid Opportunities	36
18.7 Employee Matters	36
18.8 Contribution Agreement	37
18.9 EC 328 A_Platform P&A Obligations	37
18.10 Option to Lease Office Space	37
ARTICLE 19 TAXES	38

19.1 Asset Taxes.	38
19.2 Tax Reporting	39
19.3 Transfer Taxes	39
19.4 Income and Franchise Taxes	39
ARTICLE 20 ASSUMED OBLIGATIONS; INDEMNIFICATION	39
20.1 Buyer’s Assumption of Obligations After Closing	39
20.2 Indemnification By Buyer	41
20.3 Indemnification By Seller	41
20.4 Limitation on Seller’s Indemnity Obligations	42
20.5 Survival of Provisions	42
20.6 Notice of Claim	42
20.7 Exclusive Remedy	43
ARTICLE 21 MEDIATION AND ARBITRATION	43
21.1 Mediation and Arbitration	43
ARTICLE 22 MISCELLANEOUS	45
22.1 Confidentiality	45
22.2 Notice	45
22.3 Press Releases and Public Announcements	46
22.4 COMPLIANCE WITH EXPRESS NEGLIGENCE RULE	47
22.5 Governing Law	47
22.6 Exhibits	47
22.7 Fees, Expenses, and Recording	47
22.8 Assignment	47
22.9 Buyer’s Parent as a Party	48
22.10 Seller’s Parent as a Party	48
22.11 Entire Agreement	48
22.12 Severability	48
22.13 Captions	48
22.14 Counterpart Execution	48
22.15 Waiver of Certain Damages	48
22.16 Amendments and Waivers	48
22.17 Seller’s Knowledge	49
22.18 Like-Kind Exchanges	49
22.19 Further Cooperation	49

iii

Exhibits:

1.1(A) Leases and Lands

1.1(B) Properties

1.1(C) ▇▇▇▇▇

1.1(D) Easements

1.1(G) Contracts and Material Contracts

1.1(H) Related Assets

1.1(J) Vessels and Vehicles

1.2(K) Excluded Claims

1.2(N) EC 328 A Platform P&A Obligations

1.2(O) Excluded Property and Easements

1.2(P) Disposal Barge and Equipment

15.2(A) Form of Assignment, ▇▇▇▇ of Sale and Conveyance

15.2(B) Form of Certificate of Non-Foreign Status

Schedules:

1.3A Inventory Hydrocarbons

2.1 Allocated Values

3.4 Agreed Imbalance

5.1(G) Liens and Encumbrances

10.1(H) Taxes

10.1(I) Suspended Funds

10.1(J) Compliance with Laws and Regulations

10.1(K) Preferential Rights and Consents to Assign

10.1(M) Authorities for Expenditure

10.1(N) Take or Pay

10.1(Q) Personal Property and Fixture Condition

17.1 Bonding Requirements

18.7 Excluded Employees

18.8 Contribution Agreement

INDEX OF CERTAIN DEFINED TERMS

AAA	44	GAAP	6
Accounting Referee	9	Government Taking	19
Actual Asset Taxes	39	Hydrocarbons	2
Adverse Environmental Condition	17	Imbalance	10
Agreed Imbalance	10	Indemnitee	43
Agreement	1	Indemnity Cap	43
Allocated Value	5	Independent Expert	19
Allocation	39	Individual Claim Threshold	43
Asset Taxes	8	Interim Period	29
Assets	1	Inventory Hydrocarbons	5
Assumed Environmental Obligations	41	Lands	1
Assumed Obligations	40	Leases	1
Assumed Plugging and Abandonment Obligations	40	MMMF	27
Base Purchase Price	5	NORM	27
BOEMRE	32	Overestimated Amount	39
BOEMRE Lease Bonds	34	Parties	1
Buyer	1	Party	1
Buyer’s Indemnified Claim	42	Permitted Encumbrance	13
Buyer’s Parent	1	Phase I Environmental Assessment	11
Casualty Loss	19	Phase II Environmental Assessment	11
Casualty Loss Amount	20	Post-Closing Adjustment Statement	9
Claimant	44	Preferential Rights	20
Closing	32	Properties	1
Closing Adjustment Statement	8	Purchase Price	6
Closing Date	32	Records	3
Confidentiality Agreement	46	Related Assets	2
Contracts	2	Respondent	44
Contribution Agreement	37	Revised Allocation	39
Contribution Amount	38	Royalties	6
Conveyance	32	Rules	45
curative	17	Seller	1
cure	17	Seller’s Indemnified Claim	42
Current Tax Period	8	Seller’s knowledge	49
Damages	42	Seller’s Parent	1
Defect Deductible	12	Seller’s Pro Rata Share	39
Defect Notice Deadline	12	Survival Period	43
Defensible Title	12	Title Benefit	13
Deposit	5	Title Benefit Amount	16
Disputes	44	Title Benefit Notice	16
Easements	2	Title Defect	13
Effective Time	1	Title Defect Notice	15
Environmental Defect Value	17	Title Defect Value	13
Environmental Laws	17	Transition Services Agreement	32
Estimated Asset Taxes	39	Underestimated Amount	39
Excluded Assets	3	Units	2
Excluded Employees	37	▇▇▇▇▇	1

PURCHASE AND SALE AGREEMENT

This Purchase and Sale Agreement (this “Agreement”) is entered into the 1st day of April, 2011, by and among MARITECH RESOURCES, INC., a Delaware corporation (“Seller”), and ▇▇▇▇ EXPLORATION COMPANY LLC, a Delaware limited liability company (“Buyer”), and, for the limited purposes described in Sections 22.9 and 22.10, respectively, TRT HOLDINGS, INC., a Delaware corporation (“Buyer’s Parent”) and TETRA TECHNOLOGIES, INC., a Delaware corporation (“Seller’s Parent”). Buyer and Seller are sometimes collectively referred to herein as the “Parties” and each is sometimes individually referred to as a “Party.”

RECITALS

A. Seller desires to sell to Buyer certain oil, gas and mineral properties and other assets on the terms and conditions set forth in this Agreement.

B. Buyer desires to purchase from Seller such assets on the terms and conditions set forth in this Agreement.

AGREEMENT

In consideration of the mutual agreements contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller agree as follows:

ARTICLE 1

SALE AND PURCHASE OF THE ASSETS

1.1 Acquired Assets. Subject to the terms and conditions of this Agreement, Seller agrees to sell, assign and deliver to Buyer, and Buyer agrees to purchase and acquire from Seller, as of 7:00 a.m. (Central Time) on January 1, 2011 (the “Effective Time”), all of Seller’s right, title and interest in and to the following, less and except the Excluded Assets, as defined hereafter (collectively, the “Assets”):

(A)

The oil and gas leases described on Exhibit 1.1(A) (including all working interests, royalty interests, overriding royalty interests, net profits interests, production payments, reversionary rights and all other interests therein, whether described or not), insofar, and only insofar as such leases cover the lands and, where indicated, depths described on Exhibit 1.1(A) (the “Lands”) (such leases, insofar as they cover the Lands, being referred to herein as the “Leases”);

(B)	the facilities and lands described on Exhibit 1.1(B) (the “Properties”);

(C)	All ▇▇▇▇▇ located on or associated with the Leases or Lands (whether producing, not producing or abandoned) (the “▇▇▇▇▇”), including, without limitation, the ▇▇▇▇▇ identified on Exhibit 1.1(C);

(D)

To the extent assignable or transferable, all easements, rights of way, licenses, permits, servitudes and other rights, privileges, benefits and powers to the extent used in connection with the operation of the Leases, Units (hereinafter defined), ▇▇▇▇▇, or Related Assets (hereinafter defined) (collectively, the “Easements”), including, without limitation, the Easements identified on Exhibit 1.1(D);

(E)

All rights, obligations and interests in any unit or pooled area in which the Leases are included, including all interests in any ▇▇▇▇▇ within the Units associated with the Leases, together with the rights in and to all existing and effective unitization, pooling and communitization agreements, declarations and orders, and the properties covered and the Units created thereby, to the extent they relate to or affect any of the Leases, Lands, Properties and ▇▇▇▇▇ (the “Units”);

(F)	All of the oil and gas and associated hydrocarbons in, on and under or that may be produced from or otherwise attributable to the Lands, the Leases, the Units or the Properties (“Hydrocarbons”) from and after the Effective Time;

(G)

To the extent assignable and applicable to the Assets, all hydrocarbon purchase and sale agreements, farmin agreements, farmout agreements, bottom hole agreements, acreage contribution agreements, operating agreements, unit agreements, processing agreements, options, leases of equipment or facilities, joint venture agreements, pooling agreements, transportation agreements, rights-of-way and other contracts, agreements and rights, which are owned by Seller, in whole or in part, and are appurtenant to the Leases, Lands, ▇▇▇▇▇, Units or Properties, or used in connection with the sale, distribution or disposal of Hydrocarbons or water from the Leases, Lands, ▇▇▇▇▇, Units or Properties (collectively, the “Contracts”), including, without limitation, the Contracts identified on Exhibit 1.1(G);

(H)

All well equipment, platforms, caissons and other such structures, pipelines, flowlines, gathering systems, plants, piping, buildings, treatment facilities, disposal facilities, injection facilities, compressors, casing, tanks, tubing, pumps, pumping units, motors, fixtures, machinery and other equipment located in or on the Leases, Lands, ▇▇▇▇▇, Units or Properties or used in the operation thereof which are owned by Seller, in whole or in part (the “Related Assets”), including, without limitation, the Related Assets identified on Exhibit 1.1(H);

(I)	To the extent assignable, all governmental permits, licenses and authorizations, as well as any applications for the same, related to the Leases, Lands, ▇▇▇▇▇, Units, Properties, Contracts or Related Assets, or the use thereof;

(J)	All vehicles and vessels used in the operation of the Assets, including without limitation the vehicles and vessels listed on Exhibit 1.1(J); and

(K)

All of Seller’s files, records and data relating to the items described in subsections (A) through (J) above, including, without limitation, all lease, well, division order and other title records (including title curative documents); surveys, maps and drawings; contracts; correspondence; regulatory, geological records and information; production records, electric logs, core data, pressure data, decline curves, graphical production curves and all related matters and construction documents; and Seller’s proprietary geophysical and seismic records and interpretations of same, data and related information, if any, that is not subject to contractual restrictions on disclosure or transfer (collectively, the “Records”).

1.2 Excluded Assets. Notwithstanding the foregoing, the Assets shall not include, and there is excepted, reserved and excluded from the purchase and sale contemplated herein, the following items (collectively, the “Excluded Assets”):

(A)

all credits, rebates, refunds, adjustments, accounts, instruments and general intangibles, and all insurance claims, all to the extent attributable to the Assets with respect to any period of time prior to the Effective Time and received by Buyer or Seller within eighteen (18) months after the Closing Date (hereinafter defined);

(B)

to the extent monetary settlement for same is received by Buyer or Seller within eighteen (18) months after the Closing Date all claims of Seller for refunds of or loss carry forwards with respect to (i) ad valorem, severance, production or any other taxes attributable to any period prior to the Effective Time, (ii) income or franchise taxes of Seller, or (iii) any taxes attributable to the other Excluded Assets, and such other refunds, and rights thereto, for amounts paid in connection with the Assets and attributable to the period prior to the Effective Time, including refunds of amounts paid under any gas gathering or transportation agreement;

(C)

all proceeds, income or revenues (and any security or other deposits made) attributable to (i) to the extent monetary settlement for same is received by Buyer or Seller within eighteen (18) months after the Closing Date, the Assets for any period prior to the Effective Time, or (ii) any other Excluded Assets;

(D)	all of Seller’s proprietary computer software, technology, patents, trade secrets, copyrights, names, trademarks, logos and other intellectual property;

(E)	all of Seller’s rights and interests in geological and geophysical data which cannot be transferred without the consent of, or payment to, any

party, unless Buyer obtains the applicable consent or makes the applicable payment;

(F)	all documents and instruments of Seller that are protected by an attorney-client privilege (other than title opinions);

(G)	data and other information that cannot be disclosed or assigned to Buyer as a result of confidentiality or similar arrangements under agreements with persons unaffiliated with Seller;

(H)

any and all files, records, contracts and documents relating to Seller’s efforts to sell the Assets (or any other discussions or negotiations regarding the sale or other disposition of any of the Assets), including any research, valuation or pricing information prepared by Seller and/or its consultants in connection therewith, and any bids received for such interests and information and correspondence in connection therewith;

(I)	to the extent monetary settlement for same is received by Buyer or Seller within eighteen (18) months after the Closing Date, all audit rights arising under any of the Contracts or otherwise with respect to any period prior to the Effective Time or with respect to any of the other Excluded Assets;

(J)	all corporate, partnership, and income tax records of Seller;

(K)

all claims arising from acts, omissions or events, or damage to or destruction of the Assets before the Effective Time listed on Exhibit 1.2(K) and all rights, titles, claims and interests of Seller related thereto (i) under any policy or agreement of insurance or indemnity, (ii) under any bond or letter of credit, or (iii) to any insurance or condemnation proceeds or awards;

(L)	all bonds posted by Seller;

(M)	all of Seller’s right, title and interest in, to and under the Contribution Agreements, as more fully described in Section 18.8;

(N)

all obligations to plug, abandon and remove the East Cameron 328 A Platform (together with all obligations to plug, abandon and/or remove all ▇▇▇▇▇, equipment, pipeline segments, subsurface debris and obstructions related thereto, as set forth on Exhibit 1.2(N), the “EC 328 A Platform P&A Obligations”);

(O)

the property described in Exhibit 1.2(O), together with an undivided interest in all easements, rights-of-way, licenses, permits, servitudes, surface leases, surface use agreements, and similar rights, obligations and interests, to the extent they are attributable and allocable to rights and interests so retained by Seller;

(P)	the equipment, material and barge currently located at Timbalier Bay and described on Exhibit 1.2(P) (the “Disposal Barge and Equipment”)

(Q)	all obligations, liability, and benefits related to claims and/or counterclaims asserted in the litigation listed on Schedule 10.1(H), to the extent related to production prior to the Effective Time, and the responsibility for the cost of defense thereof.

1.3 Ownership of Production from the Assets

(A)

Production Before the Effective Time. Seller shall own all Hydrocarbons produced from or attributable to the Assets before the Effective Time. If, at the Effective Time, merchantable Hydrocarbons produced from or attributable to the Assets are stored in tanks (the “Inventory Hydrocarbons”), Seller shall sell to Buyer, and Buyer shall purchase from Seller, the Inventory Hydrocarbons at the contract price in effect as of the Effective Time or the market value if there is no contract price in effect as of the Effective Time. The Inventory Hydrocarbons have been gauged and measured as of the Effective Time as set forth on Schedule 1.3A, which the Parties may update prior to Closing. Buyer shall pay Seller for the Inventory Hydrocarbons as an adjustment to the Purchase Price at Closing, as provided in Section 3.1(A)(ii).

(B)

Production After the Effective Time. Upon Closing, Buyer will own all Hydrocarbons produced from or attributable to the Assets from and after the Effective Time; provided, however, that Seller may sell on Buyer’s behalf all Hydrocarbons produced from or attributable to the Assets between the Effective Time and the Closing Date, and Seller will credit Buyer with the proceeds received from such sales as an adjustment to the Purchase Price subject to adjustment as provided in Section 3.1(B)(i).

ARTICLE 2

PURCHASE PRICE

2.1 Purchase Price. The purchase price for the Assets is Two Hundred Twenty-Two Million Two Hundred Fifty Thousand Dollars (U.S.) ($222,250,000) (the “Base Purchase Price”), subject to the adjustments provided for herein. The Base Purchase Price is allocated among the Assets as provided in Schedule 2.1 (the portion of the Base Purchase Price so allocated to an Asset being referred to herein as its “Allocated Value.”)

2.2 Deposit. Within two (2) business days after Buyer’s receipt of notice of the approval of this Agreement and the transactions contemplated by this Agreement by Board of Directors of Seller’s Parent, Buyer shall pay to Seller, by wire transfer of immediately available funds, a performance guarantee deposit (the “Deposit”) in the amount of five percent (5%) of the Base Purchase Price. Said sum is considered and recognized by Buyer and Seller as a deposit on the above stated Base Purchase Price and as ▇▇▇▇▇▇▇ money for Buyer’s performance hereunder. If Buyer fails to pay the Deposit within two (2) business days after Buyer’s receipt of notice of

the approval of this Agreement and the transactions contemplated by this Agreement by Board of Directors of Seller’s Parent, Seller may, at its sole discretion, terminate this Agreement upon written notice to Buyer, and, in such event, Seller and Buyer shall have no further obligation(s) to one another. If the Board of Directors of Seller’s Parent fails or refuses to approve this Agreement and the transactions contemplated hereunder on or before April 8, 2011, then this Agreement shall terminate and in such event, Seller and Buyer shall have no further obligation(s) to one another.

ARTICLE 3

PURCHASE PRICE ADJUSTMENTS

3.1 Adjustments to the Base Purchase Price. The Base Purchase Price shall be adjusted as follows (as so adjusted, the “Purchase Price”).

(A)	The Base Purchase Price shall be adjusted upward (without duplication) by:

(i)

an amount equal to the proceeds actually received by Buyer from the sale of Hydrocarbons produced from or attributable to the Assets prior to the Effective Time (other than Inventory Hydrocarbons), net of lessors’ royalties, overriding royalties, production payments, net profits interests, carried working interests and other similar burdens payable to third parties which burden the Assets (collectively, “Royalties”) and severance taxes paid by Buyer to third parties with respect thereto (without duplication of any amounts included in the downward adjustment to the Base Purchase Price pursuant to Section 3.1(B)(ii));

(ii)

an amount equal to the value of all Inventory Hydrocarbons, such value to be based upon the contract price governing Hydrocarbon sales from the applicable Asset in effect as of the Effective Time (or the market value if there is no price in effect as of the Effective Time), net of Royalties and severance taxes (without duplication of any amounts included in the downward adjustment to the Base Purchase Price pursuant to Section 3.1(B)(ii));

(iii)

without duplication of any adjustment pursuant to Section 3.1(B)(i), an amount equal to all operating and capital costs, expenses and other expenditures (whether capitalized or expensed), actually paid by Seller, in compliance with this Agreement, that are, in accordance with generally accepted accounting principles in the United States, consistently applied (“GAAP”), attributable to the ownership or operation of the Assets after the Effective Time, including, without duplication, all Royalties, rentals and other burdens on production, transportation and other fees and expenses relating to the transportation, processing and marketing of Hydrocarbons produced after the

Effective Time; rentals and other similar charges; expenses under applicable joint operating agreements or other contracts or agreements, including without limitation, drilling, completion, reworking, deepening, sidetracking, and plugging and abandonment costs; and ad valorem, property, production, excise, severance, and any other taxes (except income or franchise taxes) based upon or measured by the ownership of the Assets or the production of Hydrocarbons therefrom after the Effective Time;

(iv)

a fixed monthly rate, prorated if necessary, of $150,000 as compensation for overhead, operation and maintenance expenses (excluding workover costs, plugging and abandoning costs, and major costs) from and after the Effective Time to the Closing Date; provided, however, that Seller shall be entitled to retain amounts paid to Seller by third parties expressly designated as overhead charges pursuant to the joint operating agreement governing the applicable Asset from and after the Effective Time to the Closing Date;

(v)	to the extent the Assets are, in the aggregate, underproduced, the value of such net Imbalance, calculated as provided in Section 3.4;

(vi)	adjustments with respect to Title Benefits, pursuant to Section 5.4; and

(vii)

any other amount agreed upon in writing by Seller and Buyer.

(B)	The Base Purchase Price shall be adjusted downward (without duplication) by:

(i)

an amount equal to the proceeds actually received by Seller from the sale of Hydrocarbons produced from or attributable to the Assets after the Effective Time, net of Royalties and severance taxes paid by Seller (without duplication of any amounts included in the adjustment to the Base Purchase Price pursuant to Section 3.1(A)(iii));

(ii)

an amount equal to all operating and capital costs, expenses and other expenditures (whether capitalized or expensed), actually paid by Buyer that are, in accordance with GAAP, attributable to the ownership or operation of the Assets prior to the Effective Time, including, without duplication, all Royalties, rentals and other burdens on production, transportation and other fees and expenses relating to the transportation, processing and marketing of Hydrocarbons produced prior to the Effective Time; rentals and other similar charges; expenses under applicable joint operating agreements or other contracts or agreements, including without

limitation, drilling, completion, reworking, deepening, sidetracking, and plugging and abandonment costs; and, without duplication of any adjustment pursuant to Section 3.1(A)(i), ad valorem, property, production, excise, severance, and any other taxes (except income or franchise taxes) based upon or measured by the ownership of the Assets or the production of Hydrocarbons therefrom prior to the Effective Time;

(iii)

all amounts related to Preferential Rights as determined pursuant to Section 9.2;

(iv)	to the extent the Assets are, in the aggregate, overproduced, the value of such net Imbalance, calculated as provided in Section 3.4;

(v)	the amount of any adjustment for Title Defects and Adverse Environmental Conditions, determined as provided in Article 5 and Article 6, respectively;

(vi)

Seller’s share of the amount of all ad valorem, severance, property or other taxes (other than income and sales or use taxes) paid or payable with respect to or attributable to the Assets (“Asset Taxes”) for the tax period in which the Effective Time occurs (the “Current Tax Period”) which are unpaid as of the Closing Date, to the extent attributable to periods prior to the Effective Time, which amount shall, where possible, be computed based upon the tax rate and values applicable to the tax assessment period in question; otherwise, the amount of the adjustment under this paragraph shall be estimated based upon such taxes assessed against the applicable portion of the Assets for the immediately preceding tax assessment period just ended; and

(vii)

any other amount agreed upon in writing by Seller and Buyer.

3.2 Closing Statement. Seller shall prepare, in accordance with the provisions of this Article 3, a statement (the “Closing Adjustment Statement”) setting forth each adjustment to the Base Purchase Price. Seller shall submit the Closing Adjustment Statement to Buyer, together with reasonable documentation supporting the calculation of amounts presented on the Closing Adjustment Statement, no later than five (5) business days prior to the scheduled Closing Date. In the event Buyer believes that the Closing Adjustment Statement does not accurately set forth the Purchase Price and/or the adjustments thereto, Buyer shall communicate to Seller in writing such inaccuracies no later than three (3) business days prior to Closing. The Parties shall cooperate to prepare a mutually agreeable Closing Adjustment Statement on or before the date that is two (2) days prior to Closing. When available, actual figures will be used for the adjustments at Closing. To the extent actual figures are not available, estimates shall be used, subject to final adjustments as described in Section 3.3 below.

3.3 Post-Closing Adjustments.

(A)

A post-closing adjustment statement (the “Post-Closing Adjustment Statement”) based on the actual income and expenses shall be prepared and delivered by Seller to Buyer within one hundred twenty (120) days after the Closing Date, proposing further adjustments to the calculation of the Purchase Price based on the information then available. Seller and Buyer shall each be given access to and shall be entitled to review and audit the other Party’s records pertaining to the computation of amounts in such Post-Closing Adjustment Statement.

(B)

Within one hundred fifty (150) days after the Closing Date, Buyer shall deliver to Seller a written statement describing in reasonable detail its objections (if any) to any amounts or items set forth on or omitted from the Post-Closing Adjustment Statement. If Buyer does not raise objections within such period, then the Post-Closing Adjustment Statement shall become final and binding upon the Parties at the end of such period.

(C)

If Buyer raises objections, the Parties shall negotiate in good faith to resolve any such objections. If the Parties are unable to resolve any disputed item within fifteen (15) days after Seller’s receipt of Buyer’s written objections to the Post-Closing Adjustment Statement, any such disputed item shall be submitted to a nationally recognized independent accounting firm mutually agreeable to the Parties (the “Accounting Referee”) who shall be instructed to resolve such disputed item within thirty (30) days. The resolution of disputes by the Accounting Referee shall be set forth in writing and shall be conclusive, binding upon and non-appealable by the Parties. The fees and expenses of the Accounting Referee shall be paid one-half by Buyer and one-half by Seller.

(D)

Within five (5) days after the Post-Closing Adjustment Statement has become final and binding on the Parties or, if applicable, the issuance of the Accounting Referee’s decision, then, (i) in the event the estimated Purchase Price paid at Closing is greater than the final Purchase Price, as finally determined in the Post-Closing Adjustment Statement or by the Accounting Referee, as applicable, then Seller shall pay the amount of such difference to Buyer; and (ii) in the event the estimated Purchase Price paid at Closing is less than the final Purchase Price, as finally determined in the Post-Closing Adjustment Statement or by the Accounting Referee, as applicable, then Buyer shall pay the amount of such difference to Seller.

3.4 Imbalances. Buyer shall assume all rights and obligations of Seller arising from Imbalances pertaining to the Assets from and after the Effective Time (whether overproduced or underproduced). The Net Imbalances attributable to the Assets as of the Effective Time are estimated to be as set forth on Schedule 3.4 (the “Agreed Imbalance”), notwithstanding that the actual Imbalance may be less or greater. Seller shall use reasonable efforts to attempt to determine the actual net Imbalances in preparation of the Post-Closing Adjustment Statement. The Base Purchase Price shall be increased in the Post-Closing Adjustment Statement by the

actual Imbalance as of the Effective Time in the manner set forth below if the Assets are underproduced and shall be decreased in the same manner if the Assets are overproduced, in each case as provided in Section 3.1. Such Imbalances shall be accounted for between the Parties at the price of $4.00 per MMBtu for gas and $90.00 per barrel for oil (and associated Hydrocarbons). Such settlement shall be final and neither Party thereafter shall make claim upon the other concerning the Imbalances of the Assets, each Party hereby waiving any such claim to the extent permitted by applicable law. The term “Imbalance” means any Hydrocarbons production or pipeline imbalance existing as of the Effective Time with respect to any of the Assets, together with any related rights or obligations as to future cash and/or gas or product balancing, as a result of, production or pipeline delivery imbalances.

3.5 Allocation of Revenues and Expenses Upon Closing.

(A)

Allocation of Refunds and Receivables as of the Effective Time. Seller shall retain all receivables, refunds and other amounts attributable to the ownership or operation of the Assets prior to the Effective Time to the extent received by Buyer or Seller within eighteen (18) months after the Closing Date. Except to the extent an upward adjustment of the Base Purchase Price has been made with respect thereto, if Buyer collects any such receivable, refund or other amount, then Buyer shall promptly remit any such amount to Seller. After Closing, Buyer shall own all receivables, refunds and other amounts attributable to the ownership or operation of the Assets on or after the Effective Time. Except to the extent a downward adjustment of the Base Purchase Price has been made with respect thereto, if Seller collects any such receivable, refund or other amount, then Seller shall promptly remit any such amount to Buyer.

(B)

Audit Adjustments. Seller shall retain all rights and obligations relating to adjustments resulting from any operating agreement and other audit claims asserted by or against third party operators to the extent attributable to ownership or operation of the Assets prior to the Effective Time. Any credit received by Buyer pertaining to such an audit claim shall be paid to Seller within thirty (30) days after receipt.

(C)

Refunds of Asset Taxes. Refunds of Asset Taxes shall be promptly paid as follows (or to the extent payable but not paid due to offset against other Taxes shall be promptly paid (or retained, as appropriate) by the Party receiving the benefit of the offset as follows): (i) to Seller to the extent attributable to periods prior to the Effective Time; and (ii) to Buyer to the extent attributable to periods from and after the Effective Time.

(D)

Other Proceeds and Expenses. Upon and after Closing, subject to and except as otherwise provided herein and except to the extent an adjustment or an accounting with respect thereto has previously been made, (A) all monies, refunds, proceeds, receipts, credits, receivables, accounts and income attributable to the Assets conveyed hereunder (i) for all periods of time from and after the Effective Time shall be the property and

entitlement of Buyer, and, to the extent received by Seller, Seller shall fully disclose and account therefor to Buyer promptly, and (ii) for the period of time prior to the Effective Time shall be the sole property and entitlement of Seller and to the extent received by Buyer, Buyer shall fully disclose and account therefor to Seller promptly and, similarly, (B) all operating expenses and capital expenditures relating to the ownership and operation of the Assets (i) which are attributable to periods prior to the Effective Time shall be the sole responsibility of Seller, and Seller shall promptly pay same, or if paid by Buyer, promptly reimburse Buyer for same and (ii) which are attributable to periods from and after the Effective Time shall be the sole obligation of Buyer and Buyer shall promptly pay same, or if paid by Seller, promptly reimburse Seller for same.

(E)	Cooperation. Each Party covenants and agrees to promptly inform the other with respect to amounts owing under this Section 3.5.

ARTICLE 4

BUYER’S DUE DILIGENCE

4.1 Access. Prior to Closing, Seller shall grant to Buyer and its representatives, employees, consultants, independent contractors, attorneys and other advisors reasonable access during Seller’s normal business hours to (i) the Contracts and the Records, which shall be made available for review in Seller’s offices; and (ii) the Leases and other Assets operated by Seller, provided that Buyer and its representatives shall first execute such boarding agreements as may be reasonably requested by Seller prior to entering the Leases, and, with respect to Leases and other Assets not operated by Seller, Seller shall reasonably cooperate with Buyer, at no cost or expense to Seller, to obtain the operator’s consent to Buyer’s access to such non-operated leases, but Seller cannot assure such access.

4.2 Buyer’s Environmental Assessment. Buyer’s inspection of the Assets may include a Phase I Environmental Assessment and a limited Phase II Environmental Assessment of soil and water sampling and sampling interior building materials of any structure intended for human entry at sites selected by Buyer, subject to obtaining access rights pursuant to Section 4.1. For purposes of this Agreement, a “Phase I Environmental Assessment” means (i) a review of Seller’s and governmental records with respect to the compliance of the Assets with environmental laws, and (ii) subject to access rights pursuant to Section 4.1, a site visit to visually inspect and survey the Assets and obtain data regarding Asset condition through non-invasive or non-destructive means. For purposes of this Agreement, a “Phase II Environmental Assessment” means limited soil and water sampling and sampling interior building materials of any structure intended for human entry at sites selected by Buyer, subject to obtaining access rights pursuant to Section 4.1. Seller shall be provided at least forty-eight (48) hours’ prior notice of any such inspections, and Seller’s representative(s) shall have the right to witness all such inspections. Buyer shall give Seller twenty-four (24) hours notice prior to conducting invasive testing or sampling of any kind. Buyer shall conduct any sampling so as to be minimally invasive with respect to the Assets and so as to not interfere with or damage same. With respect to any samples taken in connection with Buyer’s assessment, Buyer shall take split samples, providing one of each such sample, properly labeled and identified, to Seller. Buyer will, if so

requested by Seller, furnish Seller with a copy of any Phase I and Phase II Environmental Assessments and sampling results for the Assets including, without limitation, all final reports, data, and conclusions. The cost and expense of Buyer’s assessments, if any, shall be borne solely by Buyer.

4.3 Buyer’s Indemnification of Seller. Buyer hereby RELEASES and INDEMNIFIES and SHALL DEFEND AND HOLD HARMLESS Seller and its affiliates and their respective shareholders, officers, directors, employees, agents, representatives, contractors, successors, and assigns from and against any and all claims, demands, causes of action, damages, liabilities, payments, charges, costs, and expenses of any kind or character arising from Buyer’s inspection of the Assets, including, without limitation, claims for personal or bodily injuries to or death of any person or damage to the Assets or the property of any person. THE FOREGOING INDEMNITY INCLUDES, AND THE PARTIES INTEND IT TO INCLUDE, AN INDEMNIFICATION OF THE INDEMNIFIED PARTIES FROM AND AGAINST CLAIMS ARISING OUT OF OR RESULTING, IN WHOLE OR PART, FROM THE CONDITION OF THE ASSETS OR THE SOLE, JOINT, COMPARATIVE, OR CONCURRENT NEGLIGENCE (BUT NOT GROSS NEGLIGENCE OR WILLFUL MISCONDUCT) OR STRICT LIABILITY OF, ANY OF THE INDEMNIFIED PARTIES.

ARTICLE 5

TITLE MATTERS

5.1 Certain Definitions.

(A)	“Defect Deductible” means an amount equal to two percent (2%) of the Base Purchase Price.

(B)	“Defect Notice Deadline” means 5:00 p.m. Central Time on the day which is the tenth (10th) day prior to the Closing Date.

(C)

“Defensible Title” means, with respect to an Asset, such title to the Asset that, subject to Permitted Encumbrances, (i) entitles Seller to receive not less than the percentage set forth in Exhibit 1.1(A) as Seller’s “Net Revenue Interest” of all Hydrocarbons produced, saved and marketed from the Asset; (ii) obligates Seller to bear not greater than the percentage set forth in Exhibit 1.1(A) as Seller’s “Working Interest” of the costs and expenses relating to the maintenance, development and operation of the Asset (unless there is a corresponding increase in the Net Revenue Interest); and (iii) is free and clear of all liens, claims and encumbrances.

(D)

“Title Benefit” shall mean that (i) Seller’s Net Revenue Interest in any Asset is greater than the Net Revenue Interest with respect to such Asset set forth in Exhibit 1.1(A), or (ii) Seller’s Working Interest in any Asset is less than the Working Interest set forth in Exhibit 1.1(A) for such Asset without a proportionate decrease in Seller’s Net Revenue Interest in such Asset.

(E)

“Title Defect” shall mean any particular defect in or failure of Seller’s ownership of all or any portion of any Asset that causes Seller to not have Defensible Title to all or a portion of such Asset. Notwithstanding any other provision in this Agreement to the contrary, the following shall not be considered Title Defects: (a) defects or irregularities that have been cured or remedied by the passage of time, including, without limitation, applicable statutes of limitation or statutes for prescription; (b) any individual matter having a Title Defect Value of $50,000 or less, net to Seller’s interest; or (c) any failure to record state or federal Leases, or assignments thereof, in county or parish records.

(F)

“Title Defect Value” means, with respect to an Asset, the amount by which the value of such Asset is impaired as a result of the existence of one or more Title Defects. The Title Defect Value with respect to an Asset shall be determined taking into consideration the Allocated Value of the affected Asset, the portion of the Asset affected by such Title Defect, and the legal effect of such Title Defect on the Asset. If such Title Defect is in the nature of a lien, then Seller and Buyer agree that the Title Defect Value shall be equal to the amount required to fully discharge such lien. If the Title Defect results from any matter not described above, the Title Defect Value shall be an amount equal to the difference between the value of the Asset as impaired by such Title Defect and the value of such Asset without such Title Defect (taking into account the Allocated Value of the Asset).

(G)	“Permitted Encumbrance” means:

(i)

Any materialman’s, mechanics’, repairman’s, employees’, contractors’, operators’, or other similar liens, security interests or charges for liquidated amounts arising in the ordinary course of business incidental to construction, maintenance, development, production or operation of the Assets, or the production or processing of Hydrocarbons therefrom, that are not delinquent or, if delinquent, are being contested in good faith by appropriate proceedings and are listed on Schedule 5.1(G);

(ii)

To the extent that the net cumulative effect of such contracts and documents, as to a particular Asset, do not operate to reduce the Net Revenue Interest of Seller in such Asset below that specified in Exhibit 1.1(D) or obligate Seller to bear a greater Working Interest in such Asset above that specified in Exhibit 1.1(D); production sales contracts; division orders; contracts for sale, purchase, exchange, refining, processing or fractionating of hydrocarbons; compression agreements; equipment leases; surface leases; unitization and pooling designations, declarations, orders and agreements; processing agreements; plant agreements; pipeline, gathering, and transportation agreements; injection,

repressuring, and recycling agreements; salt water or other disposal agreements; seismic or geophysical permits or agreements; and any and all other agreements which are ordinary and customary in the oil and gas exploration, development, or extraction business, or in the business of processing of gas and gas condensate production for the extraction of products therefrom;

(iii)

Any liens for taxes not yet delinquent or, if delinquent, that are being contested in good faith by appropriate proceedings and are listed on Schedule 5.1(G);

(iv)	Any liens or security interests created by law or reserved in oil, gas and/or mineral leases for royalty, bonus, or rental or for compliance with the terms of any Asset which are not yet delinquent or, if delinquent, that are being contested in good faith by appropriate proceedings;

(v)

Any easements, rights-of-way, servitudes, permits, licenses, surface leases and other rights with respect to surface operations, to the extent such matters do not interfere in any material respect with Seller’s (or, upon Closing, will not interfere in any material respect with Buyer’s) operation of the portion of the Asset burdened thereby;

(vi)

All royalties, overriding royalties, net profits interests, carried interests, reversionary interests and other burdens, to the extent that the net cumulative effect of such burdens, as to a particular Asset, does not operate to reduce the Net Revenue Interest of Seller in such Asset below that specified in Exhibit 1.1(A);

(vii)

Conventional rights of reassignment to third parties not affiliated with Seller arising upon surrender or abandonment of any Asset;

(viii)

all approvals required to be obtained in connection with the transactions contemplated herein from governmental authorities which are customarily obtained post-closing;

(ix)	preferential rights to purchase the Assets and required consents to the transfer of the Assets described on Schedule 10.1(K);

(x)	Rights reserved to or vested in any governmental authority to control or regulate any of the ▇▇▇▇▇ or Units included in the Asset and all applicable laws, rules, regulations and orders of such authorities;

(xi)	Minor defects and irregularities in title and other restrictions that are of the nature customarily accepted by prudent purchasers of oil and gas properties and do not materially affect the value of any

property encumbered thereby or materially impair the ability of the obligor to use any such property in its operations; provided the effect thereof does not operate to reduce the Net Revenue Interest of Seller for any Asset below the Net Revenue Interest set forth in Exhibit 1.1(A) or increase the Working Interest of Seller for any Asset above the Working Interest set forth in Exhibit 1.1(A) for such Asset (unless there is a corresponding increase in the Net Revenue Interest for such Asset); and

(xii)

any matter described with particularity on any schedule or exhibit to this Agreement.

5.2 Notice of Title Defects. If Buyer discovers any Title Defect affecting any of the Assets, Buyer shall notify Seller promptly, but in any event prior to the Defect Notice Deadline, of such alleged Title Defect. To be effective, such notice (“Title Defect Notice”) must (i) be in writing, (ii) be received by Seller prior to the Defect Notice Deadline, (iii) describe the Title Defect in reasonable detail, (iv) identify the specific Asset(s) affected by such Title Defect, and (v) include Buyer’s reasonable estimate of the Title Defect Value. Any matters that may otherwise constitute Title Defects, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes.

5.3 Remedies for Title Defects. Upon the receipt of a Title Defect Notice from Buyer delivered in accordance with Section 5.2, Seller shall have the option, but not the obligation, to attempt to cure such Title Defect at any time prior to the Closing. The cost of such cure or attempted cure of such Title Defect shall be borne by Seller. If Seller is unable or unwilling to cure the Title Defect before Closing, then Buyer and Seller will have the following rights and remedies with respect to the uncured Title Defect(s):

(A)	Buyer may waive the uncured Title Defect and proceed with Closing without adjustment to the Base Purchase Price.

(B)

If the aggregate Title Defect Values of uncured, unwaived Title Defects together with the aggregate Environmental Defect Values of uncured, unwaived Adverse Environmental Conditions are less than or equal to the Defect Deductible, Seller and Buyer shall proceed with Closing as to all of the Assets without curative action by Seller with respect to such Title Defects and without adjustment to the Base Purchase Price.

(C)

If the aggregate Title Defect Values of uncured, unwaived Title Defects together with the aggregate Environmental Defect Values of uncured, unwaived Adverse Environmental Conditions exceeds the Defect Deductible, then the Base Purchase Price shall be reduced by the amount by which the aggregate Title Defect Values and Environmental Defect Values agreed to by the Parties exceed the Defect Deductible. If the Parties are unable to agree on whether a Title Defect exists or the Title Defect Value attributable thereto, then (i) if the Title Defect Value of an

Asset exceeds the Allocated Value for such Asset, Buyer or Seller may, at such Party’s election, exclude the affected Asset from this transaction and reduce the Base Purchase Price by the Allocated Value of the excluded Asset, without application of the Defect Deductible that might otherwise limit the reduction of the Base Purchase Price associated with a Title Defect; or (ii) either party may refer the dispute to an Independent Expert, as defined hereinafter, for determination, in which case the affected Asset shall be included in the Assets delivered at Closing, and, in the event the Title Defect Value(s), as determined by the Independent Expert, when aggregated with all other Title Defect Values and Environmental Defect Values, exceeds the Defect Deductible, the Base Purchase Price shall be adjusted with respect thereto in the Post-Closing Adjustment Statement.

(D)	The remedies set forth in this Section 5.3 are Buyer’s exclusive remedies for all Title Defects, and Seller shall have no other liability to Buyer with respect to Title Defects.

5.4 Title Benefits. If, prior to the Defect Notice Deadline, Buyer identifies a Title Benefit affecting the Assets, Buyer shall notify Seller of such Title Benefit. Subject to the limitations set out below, Seller shall be entitled to an upward adjustment to the Base Purchase Price with respect to all Title Benefits of which either Party provides (or is required to provide) notice to the other Party (a “Title Benefit Notice”) prior to the Defect Notice Deadline. If the Title Benefit is in the nature of Seller’s Net Revenue Interest in an Asset being greater than the Net Revenue Interest set forth on Exhibit 1.1(A) and the Working Interest is also proportionately increased, then Buyer and Seller agree that, subject to the limitation set out below, the Base Purchase Price shall be increased by an amount (the “Title Benefit Amount”) equal to the Allocated Value for the relevant Asset multiplied by a fraction, the numerator of which is the amount of the increase in such Net Revenue Interest as a result of such Title Benefit and the denominator of which is the Net Revenue Interest specified for such Asset on Exhibit 1.1(A). No adjustment shall be made with respect to any Title Benefit unless the Title Benefit Amount attributable thereto exceeds $50,000. If with respect to a timely asserted Title Benefit the Parties have not agreed on the validity of the Title Benefit or the Title Benefit Amount attributable thereto on or before Closing, either Party shall have the right to elect by written notice to the other Party to have the validity of the Title Benefit and/or the Title Benefit Amount determined by an Independent Expert pursuant to Article 7.

ARTICLE 6

ENVIRONMENTAL ASSESSMENT

6.1 Certain Definitions.

(A)

“Adverse Environmental Condition” means, with respect to any Asset, the failure of the Asset to be in compliance with applicable Environmental Laws; provided, however, that no individual matter shall be deemed to be or constitute an Adverse Environmental Condition unless the Environmental Defect Value for such matter exceeds $50,000, net to Seller’s interest in the Asset.

(B)

The term “cure” or “curative” means, with respect to any Adverse Environmental Condition, the undertaking and completion of those actions and activities necessary to remediate such Adverse Environmental Condition to the degree necessary such that such Adverse Environmental Condition no longer constitutes an Adverse Environmental Condition.

(C)

“Environmental Defect Value” means, with respect to any Adverse Environmental Condition, the reasonably estimated costs and expenses to cure such Adverse Environmental Condition utilizing reasonably cost-effective remedies that are consistent with and in compliance with Environmental Laws (hereinafter defined), taking into account that non-permanent remedies (such as mechanisms to contain or stabilize hazardous materials, including monitoring site conditions, natural attenuation, risk-based corrective action, institutional controls or other appropriate restrictions on the use of property, caps, dikes, encapsulation, leachate collection systems, etc.) may be the most cost-effective manner reasonably available

(D)

“Environmental Laws” means any statute, law, ordinance, rule, regulation, code, order, judicial writ, injunction, notice to lessees or decree issued by any federal, state, or local governmental authority in effect as of the Effective Time relating to the control of any pollutant or protection of the air, water, land, or environment or the release or disposal of hazardous materials, hazardous substances or waste materials.

6.2 Notice of Adverse Environmental Conditions. Prior to the Defect Notice Deadline, Buyer shall notify Seller in writing of any Adverse Environmental Conditions identified by Buyer with respect to the Assets. Such notice shall describe in reasonable detail the Adverse Environmental Condition, include all data and information in Buyer’s possession or control bearing thereon, and include the estimated Environmental Defect Value attributable thereto. Any matters that may otherwise constitute Adverse Environmental Conditions, but of which Seller has not been specifically notified by Buyer in accordance with the foregoing, shall be deemed to have been waived by Buyer for all purposes under this Agreement. Buyer shall disclose any such Adverse Environmental Condition only to Seller and shall maintain the existence of such Adverse Environmental Condition in confidence, unless it is required to report same to any applicable agency or authority in accordance with an applicable Environmental Law.

6.3 Remedies for Adverse Environmental Conditions. Upon the receipt of a notice of Adverse Environmental Condition from Buyer delivered in accordance with Section 6.2, Seller shall have the option, but not the obligation, to attempt to cure such Adverse Environmental Condition at any time prior to the Closing. The cost of such cure or attempted cure of such Adverse Environmental Condition shall be borne by Seller. If Seller is unable or unwilling to cure the Adverse Environmental Condition before Closing, then Buyer and Seller will have the following rights and remedies with respect to the uncured Adverse Environmental Condition(s):

(A)	Buyer may waive the uncured Adverse Environmental Condition and proceed with Closing without adjustment to the Base Purchase Price.

(B)

If the aggregate Environmental Defect Values of uncured, unwaived Adverse Environmental Conditions together with the aggregate Title Defect Values of uncured, unwaived Title Defects are less than or equal to the Defect Deductible, the Parties will be obligated to proceed with Closing without curative action by Seller with respect to such Adverse Environmental Conditions and without adjustment to the Base Purchase Price.

(C)

If the aggregate Environmental Defect Values of uncured, unwaived Adverse Environmental Conditions together with the aggregate Title Defect Values of uncured, unwaived Title Defects exceeds the Defect Deductible, then the Base Purchase Price shall be reduced by the amount by which the aggregate Environmental Defect Values and Title Defect Values agreed to by the Parties exceeds the Defect Deductible. If the Parties are unable to agree on whether an Adverse Environmental Condition exists or the Environmental Defect Value attributable thereto, then (i) if the Environmental Defect Value of an Asset exceeds the Allocated Value for such Asset, Buyer or Seller may, at such Party’s election, exclude the Asset affected thereby from this transaction and reduce the Base Purchase Price by the Allocated Value of the excluded Asset, without application of the Defect Deductible that might otherwise limit the reduction of the Base Purchase Price associated with an Environmental Defect; or (ii) either Party may refer the dispute to an Independent Expert, for determination, in which case the affected Asset shall be included in the Assets delivered at Closing, and, in the event the Environmental Defect Value(s), as determined by the Independent Expert, when aggregated with all other Environmental Defect Values and Title Defect Values, exceeds the Defect Deductible, the Base Purchase Price shall be adjusted with respect thereto post-Closing.

(D)	The remedies set forth in this Section 6.3 are the sole and exclusive remedies of Buyer with respect to any adverse environmental condition attributable to the Assets.

ARTICLE 7

INDEPENDENT EXPERT.

7.1 Independent Expert. Each party shall have the right to submit disputes regarding the matters covered by Article 5, Article 6 (including the nature or calculation of Title Defects, Title Benefits and Environmental Defects), Article 8, or the pre-Closing Date representations in Sections 10.1(P) and (Q) to an independent expert appointed in accordance with this Section 7.1 (each, an “Independent Expert”), who shall serve as sole arbitrator of such dispute. An Independent Expert shall be appointed by mutual agreement of Seller and Buyer from among candidates with experience and expertise in the area that is the subject of such dispute, and failing such agreement, such Independent Expert for such dispute shall be selected in accordance with the Rules (as hereinafter defined). The cost of any such Independent Expert will be borne one-half by Seller and one-half by Buyer. For any dispute resolution proceeding under this

Section 7.1, Seller and Buyer will present a written statement of their respective positions on the dispute to the Independent Expert as soon as practicable after, but in any event within thirty (30) days after, the Independent Expert is selected. As soon as practicable after, but in any event within thirty (30) days after, receipt of such statements, the Independent Expert will make a determination of all points of disagreement in accordance with the terms and conditions of this Agreement. The decision and determination of the value of the Title Defect, Title Benefit or Environmental Defect, as applicable, made by the Independent Expert shall be binding upon the Parties as an award under the Federal Arbitration Act and final and nonappealable to the maximum extent permitted by law, and judgment thereon may be entered in a court of competent jurisdiction and enforced by either Party as a final judgment of such court.

ARTICLE 8

CASUALTY LOSS

8.1 Casualty Losses and Government Takings. If, prior to Closing, all or part of an Asset is damaged or destroyed by an act of God, terrorist action, fire, explosion, earthquake, wind storm, hurricane, tornado, tidal surge, flood, drought, condemnation, or other accident (a “Casualty Loss”), or is taken in condemnation or under the right of eminent domain, or if proceedings for such purposes shall be pending or threatened (a “Government Taking”), Seller shall promptly notify Buyer in writing of the nature and extent of the Casualty Loss or Government Taking and Seller’s estimate of the cost required to repair or replace that portion of the Assets affected by the Casualty Loss or value of the Asset taken by the Government Taking. Notwithstanding the foregoing, no individual matter described above shall be deemed to be or constitute a Casualty Loss or a Government Taking unless the estimate of the cost required to repair or replace that portion of the Asset affected by the Casualty Loss or value of the Asset taken by the Government Taking exceeds $50,000, net to Seller’s interest therein. No Casualty Loss or Government Taking will be considered a Title Defect. As used herein, a Casualty Loss does not include depletion due to normal production or depreciation or failure of equipment or casing under normal operating conditions.

8.2 Remedies for Casualty Losses and Government Takings. The Base Purchase Price shall be adjusted downward by the greater of the mutually agreed (i) amount by which the value of the affected Assets has been diminished as a result of Casualty Loss or Government Taking, or (ii) amount necessary to repair or replace the damaged, destroyed or taken Asset, in each case as such amount is determined by mutual agreement of the Parties (the “Casualty Loss Amount”). Seller shall retain (i) all insurance proceeds payable to Seller with respect to any such Casualty Loss; (ii) all sums paid to Seller by third parties by reason of any such Casualty Loss; (iii) all compensation paid with respect to any such Government Taking; and (iv) all other right, title and interest of Seller in and to any unpaid awards or other payments from third parties arising out of the damage, destruction or taking of such Assets. If the Parties are unable to agree upon the Casualty Loss Amount or the existence of a Casualty Loss, then either Party may refer the determination of the existence of a Casualty Loss and/or the amount of the Casualty Loss Amount to an Independent Expert pursuant to Section 7.1.

8.3 Change in Condition. Except for Casualty Losses and Governmental Takings, Buyer shall assume all risk and loss with respect to, and any change in the condition of the Assets from and after the Effective Time, including normal depletion, the watering-out, casing

collapse or sand infiltration of any well, the depreciation of personal property through ordinary wear and tear, and changes arising from operations conducted by Seller pursuant to Section 12.1 in the absence of gross negligence on the part of Seller. None of such events or conditions occurring after the Effective Time will be considered a Casualty Loss, nor will they be cause for any reduction in the Base Purchase Price, or give rise to any right to terminate this Agreement.

ARTICLE 9

PREFERENTIAL RIGHTS AND CONSENTS

9.1 Consents. Promptly after the Parties’ execution of this Agreement, Seller shall commence, and Buyer and Seller shall thereafter exercise, commercially reasonable efforts to obtain all such permissions, approvals and consents from third parties (other than governmental consents customarily obtained post-closing) which may be required in connection with the transfer of any of the Assets to Buyer at Closing. The Parties hereby acknowledge that “commercially reasonable efforts” shall not include any obligation to expend any money or other consideration in exchange for any consent or approval. In the event any consent is not obtained prior to the date on which Closing is scheduled to occur, then either Buyer or Seller may, upon written notice to the other Party, extend the Closing for up to thirty (30) days in an effort to obtain such required consent. In the event such required consent has not been obtained prior to the extended Closing Date then, unless waived by both Parties, the affected Asset shall be excluded from the Assets delivered at Closing and the Base Purchase Price shall be adjusted by the Allocated Value of such Asset (it being understood that, in the event the affected Asset has a negative Allocated Value, the exclusion thereof may result in an increase in the Base Purchase Price).

9.2 Preferential Rights.

(A)

With respect to preferential rights of third parties to purchase all or any portion of the Assets (“Preferential Rights”), Seller agrees that promptly after the Parties’ execution of this Agreement, it will request a waiver of Preferential Rights from each holder thereof identified by Seller (which request shall be subject to Buyer’s prior review).

(B)

If the holder of a Preferential Right exercises such right, (i) Seller shall tender to such party the required interest in the affected Asset at a price equal to the Allocated Value thereof, (ii) such interest in the Asset will be deemed an Excluded Asset and shall be excluded from the transaction contemplated hereby, and (iii) the Base Purchase Price will be adjusted downward by the Allocated Value of such Asset.

(C)

If for any reason, other than Seller’s breach, the sale of an Asset covered by an exercised Preferential Right is not consummated with the holder of the Preferential Right, Seller shall so notify Buyer promptly, but no later than sixty (60) days after the Closing Date, and within ten (10) business days after Buyer’s receipt of such notice, Seller shall sell, assign and convey to Buyer, and Buyer shall purchase and accept from Seller, such

Asset pursuant to the terms of this Agreement and for the Allocated Value thereof.

(D)

If, on the date on which the Closing is scheduled to occur, the holder of a Preferential Right has not indicated whether or not it will exercise such Preferential Right and the time period within which the holder of the Preferential Right must exercise its right has not expired, then the Closing date shall be deferred until five (5) business days after the time period to exercise such Preferential Right has elapsed without being exercised.

ARTICLE 10

REPRESENTATIONS AND WARRANTIES OF SELLER

10.1 Seller’s Representations and Warranties. Seller represents and warrants to Buyer as of the date hereof and as of the Closing Date as follows:

(A)	Status. Seller is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware and is duly qualified to carry on its business in the States of Texas and Louisiana.

(B)

Authority. Subject to the approval by the Board of directors of Seller’s Parent: (i) Seller owns the Assets and has the requisite power and authority to enter into this Agreement, to carry on its business as presently conducted, to carry out the transactions contemplated hereby, to transfer the Assets in the manner contemplated by this Agreement and the applicable conveyance documents, and to undertake all of the obligations of Seller set forth in this Agreement; and (ii) the execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite action on Seller’s part.

(C)

Validity of Obligations. The execution, delivery and performance of this Agreement and any documents delivered by Seller at Closing, and the performance of the transactions contemplated by this Agreement and any documents delivered by Seller at Closing, will not in any respect violate, nor be in conflict with or constitute a default under (or an event that with the lapse of time or notice, or both would constitute a default), other than non-material defaults that would not impair Seller's ability to consummate the transactions contemplated herein, any provision of Seller’s charter, by-laws or other governing documents, or any agreement or instrument to which Seller is a party or is bound, or any judgment, decree, order, statute, law, rule, notice to lessees, or regulation applicable to Seller (subject to governmental consents and approvals customarily obtained after the Closing). This Agreement constitutes legal, valid and binding obligations of Seller, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization and other similar laws of general application with respect to creditors, general principles of equity, and the

power of a court to deny enforcement of remedies generally based upon public policy.

(D)

Brokers. No broker or finder is entitled to any brokerage or finder’s fee, or to any commission, based in any way on agreements, arrangements or understandings made by or on behalf of Seller or any affiliate or Seller for which Buyer has or will have any liabilities or obligations (contingent or otherwise).

(E)	Bankruptcy. There are no bankruptcy, reorganization or arrangement proceedings pending, being contemplated by, or to the knowledge of Seller, threatened against Seller.

(F)

Suits. There is no suit, action, or administrative or arbitration proceeding brought by any person or entity or by any administrative agency or governmental authority pending or, to Seller’s knowledge, threatened against Seller or the Assets that has materially adversely affected or will materially adversely affect Seller’s ability to consummate the transactions contemplated herein or materially adversely affect the title to or value of the Assets.

(G)	Royalties. To Seller’s knowledge, all rentals, royalties and other payments due under the Leases during Seller’s ownership thereof have been paid in accordance with the terms of the applicable Lease, except those amounts, if any, held in suspense.

(H)

Taxes. To Seller’s knowledge, except as set forth on Schedule 10.1(H), all ad valorem, property, production, severance, excise and similar taxes and assessments based on or measured by Seller’s ownership of the Assets or the production of Hydrocarbons or the receipt of proceeds therefrom that have become due and payable have been paid in all material respects.

(I)	Suspended Funds. Except as set forth in Schedule 10.1(I), there are no proceeds from production attributable to the Assets which are being held in suspense as of the Effective Time.

(J)

Compliance with Laws and Regulations. To Seller’s knowledge, Seller’s ownership and, where applicable, operation of the Assets has been in material compliance with all applicable governmental rules, orders, regulations, notice to lessees, and laws (including Environmental Laws). Except to the extent disclosed on Schedule 10.1(J), there are no outstanding unresolved incidents of material non-compliance pertaining to the Assets, and there are no active, pending written claims known to or received by Seller from a third party relating to the Assets seeking monetary relief, injunctive relief, or remediation from Seller arising from Seller’s ownership or operation of the Assets or alleging a violation of regulation or Environmental Laws, or the unlawful disposal, discharge or

release of any hazardous substance. Further, to Seller’s knowledge, all permits necessary for such ownership and, operation have been obtained, except where the failure to obtain any such permit would not, individually or in the aggregate, have a material adverse effect.

(K)

Preferential Rights and Consents to Assign. Except as set forth in Schedule 10.1(K), the transactions contemplated by this Agreement are not subject to any Preferential Rights to purchase or any material consents to assign (other than governmental consents customarily obtained subsequent to Closing).

(L)	No Reservations. There are no reservations of or by Seller or its affiliates which affect the Assets other than those that are specifically identified on an Exhibit or Schedule to this Agreement.

(M)

Authorities for Expenditure. Except as set forth on Schedule 10.1(M), there exist no outstanding authorities for expenditure that (a) require the additional drilling of ▇▇▇▇▇ or other material development obligations in order to earn or continue to hold all or any portion of the Leases or (b) obligate Seller to make payments of any single expenditure amounts exceeding $200,000 (net to Seller) in connection with additional drilling of ▇▇▇▇▇ or other capital expenditures affecting the Leases.

(N)

Take-or Pay. To Seller’s knowledge, except as disclosed on Schedule 10.1(N), with regard to the Assets, Seller is not obligated beyond Closing by virtue of (a) a prepayment arrangement under any contract (to which Seller or its affiliates are a party) for the sale of Hydrocarbons or (b) any arrangement to deliver Seller’s Hydrocarbons produced from the Leases at some future time without receiving full payment therefore.

(O)	Material Contracts. Exhibit 1.1(G) sets forth all Contracts of the type described below (collectively, the “Material Contracts”) affecting the Assets:

(i)

any Contract that can reasonably be expected to result in aggregate payments by Seller or its successor of more than Five Hundred Thousand Dollars ($500,000) during the current or any subsequent fiscal year (based solely on the terms thereof and without regard to any expected increase in volumes or revenues);

(ii)

any Contract that can reasonably be expected to result in aggregate revenues to Seller or its successor of more than Five Hundred Dollars ($500,000) during the current or any subsequent fiscal year (based solely on the terms thereof and without regard to any expected increase in volumes or revenues);

(iii)

any Hydrocarbon purchase and sale, transportation, processing or similar Contract that is not terminable without penalty on sixty (60) days or less notice;

(iv)	any indenture, mortgage, loan, credit or sale-leaseback or similar contract that can reasonably be expected to result in aggregate payments by Seller or its successor of more than One Hundred Thousand Dollars ($100,000) during the current or any subsequent fiscal year;

(v)

any Contract that constitutes a lease under which Seller is the lessor or the lessee of real or personal property which lease (A) cannot be terminated by Seller or its successor without penalty upon sixty (60) days or less notice or (B) involves an annual base rental of more than Two Hundred Fifty Thousand Dollars ($250,000);

(vi)	any farmout, exploration or participation agreement, production handling agreement, operating agreement, area of mutual interest agreement or similar contracts or agreements entered into by Seller or its predecessor that will burden the or affect the Assets after Closing;

(vii)

any Contract that can reasonably be expected under existing circumstances to result in Seller’s or its successor’s responsibility for liabilities or obligations pertaining to the Assets in an amount greater than Five Hundred Thousand Dollars ($500,000.00); and

(viii)

any Contract with any affiliate of Seller that will not be terminated prior to Closing.

To Seller’s knowledge, there exist no material defaults under the Material Contracts by Seller or, any other person that is a party to such Material Contracts, and no event has occurred that with notice or lapse of time or both would constitute any material default under any such Contract by Seller or any other person who is a party to such Material Contract. Prior to the execution of this Agreement, Seller has made available to Buyer true and correct copies of each Material Contract and all amendments thereto.

(P)

Wellbore Condition. With respect to a Well in which there are reserves indicated for a PDSI or PDBP reserve category, in the virtual data room materials provided to Buyer prior to the date of this Agreement the wellbore of such Well does not contain an obstruction or casing flaw that will be an impediment to Buyer’s production of the reserves indicated for such Well upon Closing.

(Q)

Personal Property and Fixture Condition. Except as set forth in Schedule 10.1(Q), all personal property, fixtures, platforms, caissons and equipment constituting a part of the Assets are in a state of repair so as to be adequate for normal operations, and with respect to a Well in which there are reserves indicated for a PDSI, PDBP or PUD reserve category in the virtual data room materials provided to Buyer prior to the date of this Agreement, for operations necessary to produce the reserves indicated for such Well, unless capital cost for the installation, construction, repair or procurement of such personal property, fixtures, platforms, caissons and equipment is included in the electronic database regarding the Assets provided by Seller to Buyer.

(R)	Imbalances. Schedule 3.4 sets forth all material Imbalances associated with the Assets as of the Effective Time

(S)	Foreign Person. Seller is not a “foreign person” within the meaning of Section 1445 of the Internal Revenue Code of 1986, as amended.

10.2 Scope of Representations of Seller.

(A)

Information About the Assets. Except as expressly set forth in Section 10.1 and the other provisions of this Agreement or in the Conveyance (hereinafter defined), Seller disclaims all liability and responsibility for any representation, warranty, statements or communications (orally or in writing) to Buyer, including any information contained in any opinion, information or advice that may have been provided to Buyer by any employee, officer, director, agent, consultant, engineer or engineering firm, trustee, representative, investment banker, financial advisor, partner, member, beneficiary, stock holder or contractor of Seller whenever and however made, including those made in any data room or internet site and any supplements or amendments thereto or during any negotiations with respect to this Agreement or any confidentiality agreement previously executed by the Parties with respect to the Assets. FURTHER, EXCEPT AS SET FORTH IN SECTION 10.1 OF THIS AGREEMENT OR IN THE CONVEYANCE, SELLER MAKES NO WARRANTY OR REPRESENTATION, EXPRESS, STATUTORY OR IMPLIED, AS TO (i) THE ACCURACY, COMPLETENESS OR MATERIALITY OF ANY DATA, INFORMATION OR RECORDS FURNISHED TO BUYER IN CONNECTION WITH THE ASSETS OR OTHERWISE CONSTITUTING A PORTION OF THE ASSETS; (ii) THE PRESENCE, QUALITY AND QUANTITY OF OIL AND GAS RESERVES (IF ANY) ATTRIBUTABLE TO THE ASSETS, INCLUDING WITHOUT LIMITATION, SEISMIC DATA AND SELLER’S INTERPRETATION AND OTHER ANALYSIS THEREOF; (iii) THE ABILITY OF THE ASSETS TO PRODUCE OIL AND GAS, INCLUDING WITHOUT LIMITATION PRODUCTION RATES, DECLINE RATES AND

RECOMPLETION OPPORTUNITIES; (iv) ALLOWABLES, OR OTHER REGULATORY MATTERS; (v) THE PRESENT OR FUTURE VALUE OF THE ANTICIPATED INCOME, COSTS OR PROFITS, IF ANY, TO BE DERIVED FROM THE ASSETS; (vi) THE ENVIRONMENTAL CONDITION OF THE ASSETS; (vii) THE PLUGGING AND ABANDONMENT AND DECOMMISSIONING LIABILITIES ASSOCIATED WITH THE ASSETS; (viii) ANY PROJECTIONS AS TO EVENTS THAT COULD OR COULD NOT OCCUR; (ix) THE TAX ATTRIBUTES OF ANY ASSET; AND (x) ANY OTHER MATTERS CONTAINED IN OR OMITTED FROM ANY INFORMATION OR MATERIAL FURNISHED TO BUYER BY SELLER OR OTHERWISE CONSTITUTING A PORTION OF THE ASSETS. ANY DATA, INFORMATION OR OTHER RECORDS FURNISHED BY SELLER ARE PROVIDED TO BUYER AS A CONVENIENCE AND BUYER’S RELIANCE ON OR USE OF THE SAME IS AT BUYER’S SOLE RISK.

(B)

Independent Investigation. Buyer has, or by Closing will have, made its own independent investigation, analysis and evaluation of the transactions contemplated by this Agreement (including Buyer’s own estimate and appraisal of the extent and value of Seller’s oil and gas reserves attributable to the Assets and an independent assessment and appraisal of the environmental risks and liabilities associated with the acquisition of the Assets). Buyer has had, or will have prior to Closing, access to perform its investigation and has not relied on any representations by Seller other than those expressly set forth in this Agreement or in the Conveyance.

(C)

SALE “AS IS, WHERE IS”. Except for the Seller’s express representations and warranties in Section 10.1 and the special warranty of title in the Conveyance, the Assets are to be sold AS IS AND WHERE IS AND WITHOUT WARRANTY OF ANY KIND, WHETHER EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF TITLE, MERCHANTABILITY, CONDITION OR FITNESS FOR A PARTICULAR PURPOSE. PRIOR TO CLOSING, BUYER SHALL HAVE INSPECTED THE ASSETS AND UPON CLOSING WILL ACCEPT THE ASSETS “AS IS,” “WHERE IS,” AND “WITH ALL FAULTS” AND IN THEIR PRESENT CONDITION AND STATE OF REPAIR.

(D)

Waiver of Deceptive Trade Practices Acts. BUYER WAIVES ITS RIGHTS UNDER THE DECEPTIVE TRADE PRACTICES ACT SECTION 17.41 et seq., TEXAS BUSINESS & COMMERCE CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS, AND UNDER SIMILAR STATUTES ADOPTED IN OTHER STATES, TO THE EXTENT THEY HAVE APPLICABILITY TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. AFTER

CONSULTATION WITH AN ATTORNEY OF ITS SELECTION, BUYER CONSENTS TO THIS WAIVER.

(E)	Disclaimers as to Physical Condition of the Assets.

(i)

Subject in all respects to Article 6, Section 10.1 and Section 20.3, (i) the Assets have been used for oil and gas drilling and production operations and possibly for the storage and disposal of waste materials or hazardous substances related to oil field operations, and physical changes in or under the Assets or adjacent lands may have occurred as a result of such uses; (ii) the Assets also may contain buried pipelines and other equipment, whether or not of a similar nature, the locations of which may not be known by Seller or be readily apparent by a physical inspection of the Assets; (iii) Seller does not make any representation or warranty regarding the condition of the Assets nor the effect any such use has had on the physical condition of the Assets; (iv) Buyer shall assume the risk that the Assets may contain wastes or contaminants and that adverse physical conditions, including the presence of waste or contaminants, may not have been revealed by Buyer’s investigation; and (v) upon Closing, Buyer shall assume all responsibility and liability related to or arising from the environmental condition of the Assets, including, without limitation, the disposal, spill or release of wastes or contamination on, in, under or from the Assets, regardless of whether such conditions arose before or after the Effective Time.

(ii)

In addition, Buyer acknowledges that some oil field production equipment located on the Assets may contain asbestos and other man made material fibers (collectively, “MMMF”) and/or naturally occurring radioactive material (“NORM”). In this regard, Buyer expressly understands that NORM may affix or attach itself to the inside of ▇▇▇▇▇, materials and equipment as scale or in other forms, and that ▇▇▇▇▇, materials and equipment located on the Assets described herein may contain NORM and that NORM-containing materials may be buried or have been otherwise disposed of on the Leases. Buyer also expressly understands that special procedures may be required for the removal and disposal of MMMF and NORM from the Leases where they may be found, and that Buyer assumes all liability when such activities are performed.

ARTICLE 11

REPRESENTATIONS AND WARRANTIES OF BUYER

11.1 Buyer’s Representations and Warranties. Buyer represents and warrants to Seller as of the date hereof and as of the Closing Date as follows:

(A)	Status of Incorporation or Organization. Buyer is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware and is duly qualified to carry on its business in the States of Texas and Louisiana.

(B)

Authority. Buyer has the power and authority to carry on its business as presently conducted, to enter into this Agreement, to carry out the transactions contemplated hereby and to undertake all of the obligations of Buyer set forth in this Agreement. The execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite action on Buyer’s part.

(C)

Validity of Obligations. The execution, delivery and performance of this Agreement and any documents delivered by Buyer at Closing, and the performance of the transactions contemplated by this Agreement and any documents delivered by Buyer at Closing, will not in any respect violate, nor be in conflict with, any provision of Buyer’s operating agreement, by-laws or other governing documents, or any agreement or instrument to which Buyer is a party or is bound, or any judgment, decree, order, statute, rule or regulation applicable to Buyer (subject to governmental consents and approvals customarily obtained after the Closing). This Agreement constitutes legal, valid and binding obligations of Buyer, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization and other similar laws of general application with respect to creditors, general principles of equity, and the power of a court to deny enforcement of remedies generally based upon public policy.

(D)

Qualification and Bonding. Buyer is qualified and shall hereafter continue to be qualified to own and operate federal oil, gas and mineral leases and rights-of-way in the federal waters in the Gulf of Mexico, and the consummation of the transactions contemplated by this Agreement will not cause Buyer to be disqualified as such an owner or operator. Buyer acknowledges that none of the bonds and guarantees, if any, posted by Seller or its affiliates with the BOEMRE or other governmental entities and relating to the Assets are transferable to Buyer.

(E)

Securities. Buyer intends to acquire the Assets for its own benefit and account and is not acquiring said Assets with the intent of distributing fractional undivided interests thereof such as would be subject to regulation by federal or state securities laws, and if, in the future, it should sell, transfer or otherwise dispose of said Assets or fractional undivided interests therein, it will do so in compliance with any applicable federal and state securities laws.

(F)	Evaluation. Buyer represents that by reason of Buyer’s knowledge and experience in the evaluation, acquisition and operation of oil and gas

properties, Buyer has evaluated the merits and risks of purchasing the Assets from Seller and has formed an opinion based solely upon Buyer’s knowledge and experience and upon the representations and warranties of Seller set forth in this Agreement.

(G)	Financing. At Closing, Buyer or an assignee of Buyer permitted under Section 22.8 will have (or Buyer’s Parent shall have furnished to Buyer or such assignee) sufficient cash, available lines of credit or other sources of immediately available funds to enable it to pay the Purchase Price to Seller.

(H)

Broker’s Fees. Buyer has incurred no obligation or liability, contingent or otherwise, for brokers’ or finders’ fees in respect of the matters provided for in this Agreement, and, if any such obligation or liability exists, it shall remain an obligation of Buyer, and Seller shall have no responsibility therefor.

(I)	No Knowledge of Seller’s Breach. As of the date of this Agreement, Buyer has no knowledge of any breach by Seller of any representation or warranty of Seller, or of any other fact, event, condition or circumstance that would excuse Buyer from the timely performance of its obligations hereunder.

ARTICLE 12

INTERIM OPERATIONS

12.1 Interim Operations. With respect to operations of the Assets during the period between the execution of this Agreement and the Closing Date (the “Interim Period”), Seller covenants that it shall (i) to the extent within the control of Seller, cause the Assets to be maintained and operated in the ordinary course, consistent with past practices; (ii) provide notice of any AFE copies received by Seller for any operations involving Seller commitments of less than $100,000, net to Seller’s interest; (iii) obtain Buyer’s prior written approval prior to consenting to (A) any workover designed to change the existing completion interval with respect to any Well, and (B) any future expenditures and proposed contracts and agreements relating to the Assets that involve individual commitments of $100,000 or more, net to Seller’s interest; (iv) obtain Buyer’s prior written approval prior to, by action or inaction, going non-consent on any proposal made pursuant to any joint operating or similar agreement affecting the Assets; and (v) obtain Buyer’s written approval before voting under any operating, unit, joint venture, or similar agreement; provided, however, that Buyer will not unreasonably withhold or delay a determination on any such approval under (iii), (iv) or (v) above. Furthermore, during the Interim Period, Seller will not, without the prior written consent of Buyer, (a) enter into any agreement or arrangement transferring, selling, or encumbering any of the Assets, other than sales of current production or products in the ordinary course of business and dispositions in the ordinary course of business of any item of personal property or equipment having a value of less than $50,000 and that is promptly replaced with similar property or equipment of equal or greater value and utility; (b) grant any Preferential Right or other similar right to purchase any Assets; or (c) enter into, terminate or amend any Material Contract relating to the Assets, including entering

into any new production sales contract extending beyond the Closing Date and not terminable on sixty (60) days’ notice or less; or (d) commit to do any of the foregoing. Notwithstanding the forgoing, in the face of serious risk to life, property, or the environment, Seller may take, or consent to, such action as a prudent operator, or non-operator, as the case may be, would take without obtaining Buyer’s prior consent. Seller shall notify Buyer of any emergency action taken, and to the extent reasonably practicable, obtain Buyer’s prior approval of such actions. However, except for emergency action that must be taken in the face of serious risk to life, property, or the environment, Seller has no obligation to undertake any actions with respect to the Assets that are not required in the course of the normal operation of the Assets. To the extent that Seller is not the operator of any portion of the Assets, the obligations of Seller in Section 12.1 concerning operations or activities that normally, or pursuant to existing contracts are carried out or performed by the operator, shall be construed to require only that Seller use all reasonable efforts (without being obligated to incur any expense or institute any cause of action) to cause the operator of such portion of the Assets to take such actions or render such performance within the constraints of the applicable operating or other agreements.

12.2 Disposal Barge and Equipment. Prior to Closing, Seller, at its cost and expense, shall remove and dispose of the Disposal Barge and Equipment, using a contractor or contractors licensed to handle and dispose of material containing NORM.

ARTICLE 13

CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS OF BUYER

The Buyer’s obligations to proceed to Closing are, at Buyer’s election, subject to the fulfillment, prior to or at the Closing, of each of the following conditions:

13.1 No Litigation. As of the date of Closing, no suit, action or other proceeding shall be pending before any court or governmental agency that seeks to prevent the consummation of the transactions contemplated by this Agreement.

13.2 Representations and Warranties; Covenants. All representations and warranties of Seller contained in this Agreement shall be true and correct in all material respects as of the Closing as if such representations and warranties were made as of the Closing Date (except for those representations or warranties that are expressly made only as of another specific date, which representations and warranties shall be true in all material respects as of such other date) and Seller shall have performed and satisfied in all material respects all covenants and fulfilled all conditions required by this Agreement to be performed and satisfied by Seller at or prior to the Closing.

13.3 Aggregate Adjustments Base to Purchase Price. The aggregate downward adjustment to the Base Purchase Price on account of Title Defects, Adverse Environmental Conditions, Casualty Loss, and the exercise of Preferential Rights does not exceed twenty-five percent (25%) of the Base Purchase Price.

ARTICLE 14

CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS OF SELLER

The Seller’s obligations to proceed to Closing are, at Seller’s election, subject to the fulfillment, prior to or at the Closing, of each of the following conditions:

14.1 No Litigation. As of the date of Closing, no suit, action or other proceeding shall be pending before any court or governmental agency which attempts to prevent the occurrence of the transactions contemplated by this Agreement.

14.2 Representations and Warranties; Covenants. All representations and warranties of Buyer contained in this Agreement shall be true in all material respects as of the Closing as if such representations and warranties were made as of the Closing Date (except for those representations or warranties that are expressly made only as of another specific date, which representations and warranties shall be true in all material respects as of such other date), and Buyer shall have performed and satisfied in all material respects all covenants and fulfilled all conditions required by this Agreement to be performed and satisfied by Buyer at or prior to the Closing.

14.3 Aggregate Adjustments Base to Purchase Price. The aggregate downward adjustment to the Base Purchase Price on account of Title Defects, Adverse Environmental Conditions, Casualty Loss, and the exercise of Preferential Rights does not exceed twenty-five percent (25%) of the Base Purchase Price.

14.4 Buyer’s Qualification and Bonding. Buyer shall have delivered to Seller documentation reasonably satisfactory to Seller (i) evidencing that Buyer is qualified to own and operate leases and rights-of-way on the Outer Continental Shelf; (ii) evidencing that Buyer has obtained or posted all such bonds or other security as may be required by each regulatory authority having jurisdiction over the Assets, including, without limitation, the BOEMRE, in order to own and operate the Assets, and (iii) if required under Section 20.1(E), the Chevron Letter of Credit.

ARTICLE 15

CLOSING

15.1 Closing. The consummation of the sale and purchase of the Assets (“Closing”) shall be held at 10:00 a.m. Central Time on May 31, 2011, or such other date mutually agreed to in writing by the Parties. The date on which Closing actually occurs is referred to herein as the “Closing Date.” The Closing will take place at the offices of Seller at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, or at such other location to which the parties may mutually agree.

15.2 Deliveries by Seller. At Closing, Seller shall deliver to Buyer:

(A)	An executed and acknowledged Assignment, ▇▇▇▇ of Sale and Conveyance, substantially in the form attached hereto as Exhibit 15.2(A) (the “Conveyance”), in sufficient counterparts to facilitate recording, effecting the sale, transfer, conveyance and assignment to Buyer of the Assets.

(B)	Seller’s executed Certificate of Non-Foreign Status, substantially in the form attached hereto as Exhibit 15.2(B).

(C)

Executed assignments of record title ownership or operating rights with respect to the Leases, as applicable, on appropriate U.S. Bureau of Ocean Energy Management, Regulation and Enforcement (“BOEMRE”) forms and such additional documentation as Buyer may reasonably request for purposes of filing in the applicable counties.

(D)	Letters in lieu executed by Seller with respect to all of the Assets.

(E)	Subject to the provisions of Section 18.3 below, change of operator forms executed by Seller designating Buyer to succeed Seller as operator of the Seller operated Assets.

(F)

An executed Transition Services Agreement (the “Transition Services Agreement”) in form and substance reasonably acceptable to Seller and Buyer pursuant to which Seller agrees to provide services related to the operation of the Assets at the request of Buyer, to the extent Seller has the capability of performing such services, including, but not limited to, accounting, information technology, operational, regulatory compliance, human resources services and other support after Closing upon the payment terms and for the Transition Period, all as more particularly described therein.

15.3 Deliveries by Buyer. At Closing, Buyer shall deliver to Seller:

(A)	An amount equal to the Purchase Price, as set forth in the Closing Adjustment Statement, less the Deposit, by wire transfer of immediately available funds to an account designated in writing by Seller.

(B)

Duplicate executed originals of all applicable governmental forms required of Buyer by the BOEMRE and other governmental entities with jurisdiction over the Assets in connection with the transfer of the Assets and, if applicable, the operation thereof, including, without limitation, any designation of operator, designation of applicant and oil spill financial responsibility forms.

(C)

Evidence, reasonably acceptable to Seller, that Buyer has obtained all bonds required by any regulatory agency having jurisdiction, including but not limited to the BOEMRE, in order to be recognized as the owner, and where applicable, the operator, of the Assets upon appropriate filings with such regulatory agencies.

(D)	Certificates of insurance evidencing that Buyer has obtained the insurance coverages required under Section 17.3 below.

(E)	An executed Transition Services Agreement.

ARTICLE 16

TERMINATION

16.1 Termination. This Agreement and the transactions contemplated herein may be terminated:

(A)	At any time by mutual consent of the Parties, in which event the Deposit shall be returned to Buyer.

(B)

By either Party if the Closing shall not have occurred by June 1, 2011; provided that the Party desiring to terminate is not in breach in any material respect of this Agreement. In the event that this Agreement is terminated pursuant to this Section 16.1(B), the Deposit shall be returned to Buyer provided that Buyer is not in material breach of this Agreement.

(C)	By Buyer if, on the Closing Date, any of the conditions set forth in Article 13 hereof shall not have been satisfied or waived, in which event the Deposit shall be returned to Buyer.

(D)

By Seller if, on the Closing Date, Buyer’s conditions to Closing set forth in Article 13 have been satisfied but Buyer fails or refuses to close, in which event the Deposit shall be retained by Seller; provided that Seller is not in material breach of this Agreement, otherwise the Deposit shall be returned to Buyer.

(E)

By Seller if, on the Closing Date, any of the conditions set forth in Article 14 hereof shall not have been satisfied or waived, in which event the Deposit shall be retained by Seller if the termination results from the failure of the conditions precedent set forth in Section 14.1, 14.2 or Section 14.4, otherwise the Deposit shall be returned to Buyer.

16.2 Effect of Termination. In the event of the termination of this Agreement pursuant to the provisions of this Article 16 or elsewhere in this Agreement, (i) Seller’s sole remedy for such termination shall be the retention of the Deposit, to the extent that Seller has an express right to do so under the terms of the Agreement, and (ii) Buyer’s remedy shall be (A) the return of the Deposit, to the extent that Buyer has an express right therefore, or (B) at Buyer’s option, and provided that Buyer is not in material breach of this Agreement, the right to pursue specific performance of the obligations of Seller under this Agreement. Notwithstanding the foregoing, the indemnity obligations of Buyer in Section 4.3 shall survive such termination. Upon termination, Buyer shall return to Seller or destroy, all materials, documents and copies thereof provided to Buyer in the course of Buyer’s due diligence investigations, including all notes, reports, analyses and other materials derived therefrom.

ARTICLE 17

BUYER’S POST-CLOSING BONDING AND INSURANCE OBLIGATIONS

17.1 Governmental Bonds. To the extent required by any applicable laws and except to the extent, if any, that Buyer will, as of Closing, be covered by the bonds or exempt status of

third party operators of the applicable Assets, Buyer will have as of Closing, and will thereafter continue to maintain, lease bonds, area-wide bonds, or any other surety bonds as may be required by, and in accordance with, all applicable laws governing the ownership of such Assets, and Buyer shall file any and all required reports necessary for such ownership with the BOEMRE and all other governmental entities having jurisdiction over such ownership, including, but not limited to, adequate financial assurance in accordance with the Oil Pollution Act of 1990, as amended. Without limiting the foregoing, Buyer shall obtain, prior to Closing, the necessary bonds or parent guaranties or letters of credit as required by the BOEMRE for the plugging and abandonment and decommissioning of all ▇▇▇▇▇ and dismantling of any Related Assets and provide Seller with a copy of same. Promptly following Closing, Buyer shall provide proof satisfactory to Seller that the BOEMRE has accepted such bonds or letters of credit as sufficient assurance to cover the plugging and abandonment of all ▇▇▇▇▇ and the decommissioning of all Related Assets. Further, following Closing, Buyer shall provide to Seller copies of the approval by the BOEMRE concerning change of operatorship of the Assets. In addition to any general bonds that may be required by the BOEMRE of Buyer, it is anticipated that Buyer will be required to post supplemental bonds with the BOEMRE, on a lease specific basis, for the properties and in the amounts specified on Schedule 17.1 attached hereto (the “BOEMRE Lease Bonds”).

17.2 Supplemental Bonding Requirements. Buyer agrees to promptly purchase and post any and all bonds, supplemental bonds or other securities which may be required of it pursuant to all applicable federal, state, tribal and local laws, rules and regulations.

17.3 Insurance Coverages. From the Closing through the end of the Transition Period, Buyer shall have in force and effect insurance policies in compliance with all applicable agreements, including, but not limited to, operating agreements and participation agreements relating to the Assets. In no event shall such level of insurance be less than the following minimum amounts and, with respect to the coverages specified in this Section 17.3, each insurance policy shall contain an endorsement waiving the underwriters’ rights of subrogation against Seller with respect to liabilities assumed hereunder by Buyer and, except for Worker’s Compensation and Employer’s Liability, shall include Seller as an additional insured through the end of the Transition Period. The insurance provided by Buyer shall be primary to any other insurance carried by or on behalf of Seller. At Closing, Buyer will provide Seller with confirmation that Buyer has secured and maintains the following minimum insurance coverage with limits of liability of not less than those set out below:

(A)

Worker’s Compensation and Employer’s Liability: Worker’s Compensation Insurance in accordance with the laws of governmental bodies having jurisdiction including, if applicable, United States ▇▇▇▇▇▇▇▇▇ and Harbor Worker’s Compensation Act with Outer Continental Shelf Extension, Maritime Employer’s Liability (including, but not limited to, the ▇▇▇▇▇ Act, the Death on the High Seas Act, as well as an endorsement to the effect that a claim in rem shall be treated as a claim against the insured) and Employer’s Liability Insurance. Employer’s Liability Insurance shall provide minimum coverage of $1,000,000 for bodily injury per accident and by disease.

(B)	Commercial General Liability: Bodily Injury and Property Damage, including contractual liability covering Buyer’s obligations under this Agreement and sudden and accidental pollution coverage, with minimum limits of $1,000,000 per occurrence, combined single limit.

(C)	Business Automobile Liability Insurance covering all Owned, Leased, Hired or Non-Owned Vehicles: Bodily Injury and Property Damage with minimum limits of $1,000,000 per occurrence combined single limit.

(D)	Vessels: If Buyer charters any vessels, Charterer’s Legal Liability (or equivalent coverage) with minimum limits of $1,000,000 will be carried.

(E)	Umbrella Liability: Umbrella Liability Insurance with a minimum limit of $35,000,000 excess of all primary limits of liability insurance specified in paragraphs 17.3(A) through 17.3(D) above.

(F)

Operator’s Extra Expense Insurance: Operator’s Extra Expense Insurance and Control of Well Insurance, including control of well due to blowout and/or cratering above or below the surface and Seepage and Pollution Liability including cleanup and containment. The policy will cover all the ▇▇▇▇▇ identified on Exhibit 1.1(C), and have a minimum limit of $35,000,000 (100%) each occurrence.

(G)

Property Insurance covering physical damage for the ▇▇▇▇▇ and structures identified in Exhibit 1.1(C) for a minimum limit of $7,500,000 each occurrence, including a $7,500,000 aggregate sublimit for Property and/or Operator’s Extra Expense losses arising from Named Wind Storm. Such coverage will also be endorsed to include removal of wreck as customary.

Buyer shall obtain insurance coverage for all liability assumed under the terms of this Agreement with limits not less than those set out above. Seller shall not be obligated or authorized to obtain or carry on behalf of the Buyer any insurance covering the Assets or any operations to be conducted after the Closing Date. All such insurance of Buyer hereunder shall be written by insurance companies with a minimum A.M. Best rating of A-VII. Buyer shall furnish Seller with certificates of insurance listing all such insurance policies. All certificates must be signed by authorized representatives of the insurance companies, and must endeavor to provide not less than thirty (30) days prior written notice to Seller in the event of policy cancellation or material change affecting Seller’s interest prior to the end of the Transition Period. Neither failure to comply, nor full compliance with the insurance provisions of this Agreement, shall limit or relieve Buyer from its indemnity obligations in accordance with this Agreement.

ARTICLE 18

OTHER POST-CLOSING COVENANTS

18.1 Seller’s Logos. Within thirty (30) days after Closing, Buyer shall replace, or cover or cause to be covered by decals or new signage, any names and marks used by Seller, and

all variations and derivatives thereof and logos relating thereto, from the Assets and shall not thereafter make any use whatsoever of such names, marks and logos.

18.2 Records. Within thirty (30) days after Closing, Seller shall deliver originals (or copies if originals are not available) of all of the Records to Buyer. Seller shall have the right to make and retain copies of the Records as Seller may desire prior to the delivery of the Records to Buyer. Buyer, for a period of seven (7) years after the Closing Date, shall make available to Seller (at the location of such Records in Buyer’s organization) access to the Records upon the prior written request of Seller, during normal business hours.

18.3 Operatorship. Immediately upon Closing, Seller will send notifications of its resignation as operator for all ▇▇▇▇▇ that Seller currently operates and is selling to Buyer pursuant to this Agreement. Seller makes no representation and/or warranty to Seller as to the transferability or assignability of operatorship of such ▇▇▇▇▇. Buyer acknowledges that the rights and obligations associated with such ▇▇▇▇▇ are governed by applicable agreements and that operatorship will be determined by the terms of those agreements.

18.4 Suspended Funds. As of Closing, Schedule 10.1(I) describes all proceeds, if any, from production attributable to the Leases which are currently held in suspense, and shall transfer to Buyer all of those suspended proceeds. BUYER SHALL BE RESPONSIBLE FOR PROPER DISTRIBUTION OF ALL THE SUSPENDED PROCEEDS, TO THE EXTENT SUCH FUNDS ARE DELIVERED TO BUYER BY SELLER, TO THE PARTIES LAWFULLY ENTITLED TO THEM AND SHALL BE RESPONSIBLE FOR ANY CLAIMS RELATED THERETO, AND BUYER HEREBY AGREES TO INDEMNIFY, DEFEND AND HOLD HARMLESS SELLER FROM AND AGAINST ANY AND ALL DAMAGES, AS DEFINED HEREIN, ARISING OUT OF OR RELATING TO SUCH SUSPENDED PROCEEDS IN EACH CASE TO THE EXTENT OF THE FUNDS RELATED THERETO DELIVERED TO BUYER BY SELLER.

18.5 Notice of Transfer. Promptly after Closing, Buyer shall notify all pertinent operators, non-operators, oil or gas purchasers, governmental agencies and royalty owners that it has purchased the Assets.

18.6 Work Bid Opportunities. For a period of two (2) years from the Closing Date, Buyer will make reasonable efforts to afford Seller’s Parent the opportunity to bid on any well, platform, facility or pipeline abandonment and decommissioning activity with respect to any of the Assets, to the extent the anticipated estimated cost of any such activity will exceed $250,000. Nonetheless, nothing in this Section will require Buyer to accept any bid from Seller’s Parent.

18.7 Employee Matters. From the date of this Agreement to thirty (30) days after the termination of the Transition Services Agreement (the “Transition Period”), Buyer shall have the opportunity and right, but not the obligation, to interview and/or make offers of employment to any employees of Seller other than those listed on Schedule 18.7 (the “Excluded Employees”). Buyer shall give notice to Seller at least fifteen (15) days prior to the end of the Transition Period of the employees of Seller to whom Buyer has or will make offers of employment. Seller shall not discourage any employee of Seller from accepting employment with Buyer. The terms and conditions of employment of any employees hired by Buyer shall be at Buyer’s sole discretion.

Seller shall be responsible for all compensation due to Seller’s employees or former employees with respect to their employment with Seller, whether or not hired by Buyer. This Agreement shall not obligate Buyer to be a successor employer or to assume any collective bargaining agreements between Seller and any union representative in effect prior to or as of the end of the Transition Period. Seller shall be responsible for paying or causing to be paid directly to Seller’s current and former employees (including any employees who are hired by Buyer) or their dependents, all benefits to which they are entitled under any past or present employee benefit plans of Seller, and Buyer shall assume no liability for such benefits. No portion of the assets of any plan, fund, program, or arrangement, whether written or unwritten, heretofore sponsored or maintained by Seller (and no amount attributable to any such plan, fund, program, or arrangement) shall be transferred to Buyer, and Buyer shall not be obligated or required to continue any such plan, fund, program, or arrangement after the Closing Date. Seller shall pay all accrued vacation and pay for vacation days not used by its employees as of the date of any termination of such employees related to the transaction contemplated by this Agreement, whether or not they become employees of Buyer.

18.8 Contribution Agreement. Reference is made to the contract specified on Schedule 18.8 attached hereto (the “Contribution Agreement”) which provides that upon completion of Assumed Plugging and Abandonment Obligations with respect to certain of the Assets covered by the Contribution Agreement, Seller will be entitled to a certain monetary amounts (the “Contribution Amount”) associated with the Assumed Plugging and Abandonment Obligations for such Assets. Seller warrants that the Assets and the corresponding Contribution Amount provided for in the Contribution Agreement is as indicated on Schedule 18.8. Seller has provided Buyer with a copy of the Contribution Agreement. Upon completion by Buyer of the Assumed Plugging and Abandonment Obligations with respect to each of the Assets specified on Schedule 18.8, Buyer will furnish Seller with such information and documentation as may be required under the Contribution Agreement in order that Seller may request the Contribution Amount associated with such Assumed Plugging and Abandonment Obligations from the appropriate party pursuant to the Contribution Agreement. Upon receipt of such Contribution Amount, Seller shall promptly thereafter pay such Contribution Amount to Buyer. If Seller has not received the Contribution Amount within sixty (60) days of the date Buyer furnishes Seller with information and documentation as required under the Contribution Agreement, Seller will nonetheless pay such Contribution Amount to Buyer.

18.9 EC 328 A_Platform P&A Obligations. Within sixteen (16) months after Closing (or by such earlier date as may be required by the BOEMRE), Seller will initiate on-site physical operations to perform the EC 328 A_Platform P&A Obligations. Thereafter, Seller will use its reasonable commercial efforts to conduct and complete the EC 328 A_Platform P&A Obligations, subject to governmental interference or delay in issuing necessary permits and authorizations despite Seller’s efforts to timely obtain such permits and authorizations or address the related governmental issues, in compliance with all applicable legal and regulatory requirements.

18.10 Option to Lease Office Space. Upon later of the Closing Date or the end of the Transition Period, Buyer shall have the option, exercisable by giving written notice to Seller by such date, to lease from Seller the fifth (5th) floor of the office space currently occupied by Seller at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, at a market rate per square

foot on a month-to-month basis for up to eighteen (18) months, with such other terms as are standard for commercial office space leases for comparable space in the area.

ARTICLE 19

TAXES

19.1 Asset Taxes.

(A)

All Asset Taxes shall be prorated between Buyer and Seller as of the Effective Time for all taxable periods that include the Effective Time. All Asset Taxes attributable to periods, including partial periods, prior to the Effective Time are the obligation of, and shall be borne by, Seller. All Asset Taxes attributable to periods, including partial periods, from and after the Effective Time shall be borne by Buyer. The Base Purchase Price shall be adjusted as provided in Section 3.1(A)(iii) and Section 3.1(B)(ii) with respect to the proration of Asset Taxes for the Current Tax Period that are paid prior to the Closing Date. With respect to Asset Taxes for the Current Tax Period that are not paid prior to the Closing Date, a proration shall be made between the Parties as an adjustment to the Base Purchase Price pursuant to Section 3.1(B)(iv) based on the best current information available as of Closing, subject to further adjustment in the Post-Closing Adjustment Statement based on then-current information. If actual Asset Taxes with respect to the Current Tax Period (“Actual Asset Taxes”) are greater than the amounts estimated for purposes of the Post-Closing Adjustment Statement pursuant to Section 3.3 (the “Estimated Asset Taxes”), then Seller shall pay Buyer an amount equal to such difference (the “Underestimated Amount”), multiplied by a fraction, the numerator of which is the number of days in the Current Tax Period which are prior to the Effective Time and the denominator of which is the total number of days in the Current Tax Period (“Seller’s Pro Rata Share”). Seller shall pay such amount to Buyer within ten (10) business days of Seller’s receipt of Buyer’s invoice therefor. If Actual Asset Taxes are less than Estimated Asset Taxes, then Buyer shall pay Seller an amount equal to such difference (the “Overestimated Amount”) multiplied by Seller’s Pro Rata Share. Buyer shall pay such amount to Seller within ten (10) business days after Buyer’s receipt of statements setting out the amount of Actual Asset Taxes.

(B)

For the Current Tax Period, Seller agrees to immediately forward to Buyer any tax reports and returns received by Seller after Closing and to provide Buyer with any information in Seller’s possession that is necessary for Buyer to timely file any required tax reports and returns. With respect to taxable periods that include the Effective Time, Buyer shall file all tax returns and reports applicable to the Assets required to be filed after the Closing Date and shall indemnify the Seller against liability for the payment of Asset Taxes with respect to such tax returns and reports and the filing of such tax returns and reports.

19.2 Tax Reporting. Prior to Closing, Buyer and Seller shall confer and cooperate in the allocation of the Base Purchase Price among the Properties in accordance with Section 1060 of the Internal Revenue Code and the Treasury Regulations thereunder (and any similar provision of state, local or foreign law, as appropriate) (the “Allocation”). Buyer and Seller shall confer and cooperate on any revisions to the Allocation (the “Revised Allocation”) so as to report any matters related to the Allocation that require updating (including adjustments to the Base Purchase Price) to be consistent with the agreed allocation. Seller and Buyer shall report the transactions contemplated hereby on all tax returns, including, but not limited to Form 8594, in a manner consistent with the Allocation or, if applicable, the Revised Allocation.

19.3 Transfer Taxes. The Parties believe that no sales, transfer or similar tax is applicable to the transactions contemplated herein and, accordingly, no such tax will be collected at Closing from Buyer in connection with this transaction. If, however, this transaction is later deemed to be subject to sales, transfer or similar tax, for any reason, Buyer agrees to be solely responsible, and shall indemnify and hold Seller (and its affiliates, and its and their directors, officers, employees, attorneys, contractors and agents) harmless, for any and all sales, transfer or other similar taxes (including related penalty, interest or legal costs) due by virtue of this transaction on the Assets transferred pursuant hereto and the Buyer shall remit such taxes at that time. Seller and Buyer agree to cooperate with each other in demonstrating that the requirements for exemptions from such taxes have been met.

19.4 Income and Franchise Taxes. Notwithstanding any provision of this Agreement to the contrary, each Party shall be responsible for its own federal, state, local and foreign income and franchise taxes, if any, that are attributable to its ownership of the Properties or that may result from the consummation of the transactions contemplated by this Agreement.

ARTICLE 20

ASSUMED OBLIGATIONS; INDEMNIFICATION

20.1 Buyer’s Assumption of Obligations After Closing. Upon and after Closing, Buyer assumes, agrees to pay and perform, and expressly releases and discharges Seller, Seller’s affiliates and Seller’s and its affiliates’ past, present and future managers, members, officers, directors, trustees, employees and partners from all of the following obligations, liabilities, and duties with respect to the Assets (collectively, the “Assumed Obligations”):

(A)	All obligations, liabilities and duties with respect to the ownership and operation of the Assets attributable to periods from and after the Effective Time, including, without limitation, to the extent, in each case, attributable to periods from and after the Effective Time:

(i)	The obligation to pay all operating expenses and capital expenditures attributable to the Assets;

(ii)	The obligation to perform all express obligations and covenants under the terms of the Leases, the Easements and the Contracts and any implied obligations and covenants under the Leases;

(iii)

The obligation to pay all Royalties, rentals, shut-in payments, and other burdens or encumbrances to which the Leases are subject; and

(iv)	The obligation to comply with all applicable laws, ordinances, rules, orders and regulations pertaining to the Assets;

(B)

All obligations, liabilities and duties with respect to plugging, abandonment, decommissioning, and site clearance operations relating to the Assets, and all required remediation relating to the Assets, whether arising before or after the Effective Time, all in accordance with applicable laws (“Assumed Plugging and Abandonment Obligations”), including, without limitation, all of those plugging and abandonment obligations set forth in Section 13.29 of that Purchase and Sale Agreement dated July 7, 2005 by and between Pioneer Natural Resources USA, Inc. and Maritech Resources, Inc. No later than January 31st of each calendar year, Buyer shall provide Seller with written confirmation that it has fulfilled its annual obligations for the prior year in accordance with Section 13.29 of that Purchase and Sale Agreement dated July 7, 2005 by and between Pioneer Natural Resources USA, Inc. and Maritech Resources, Inc.

(C)	Subject to adjustment pursuant to Section 3.4, the Imbalances with respect to the Assets, whether arising before or after the Effective Time; and

(D)

All obligations, liabilities and duties with respect to the environmental condition of the Assets, the compliance of the Assets or the operation thereof with Environmental Laws or the presence, release, disposal or storage of pollution, contamination, hazardous substances, wastes, materials and products by or in connection with the Assets, whether arising before or after the Effective Time, and regardless of whether resulting from any negligent acts or omissions or strict liability of Seller, its affiliates, its or its affiliates’ past, present or future members, managers, working interest partners, officers, directors, trustees, agents, and contractors, or Buyer, or the condition of the Assets when acquired, including, without limitation, clean-up responses, remediation, control, assessment and compliance with respect to air, water, surface or subsurface pollution, and other obligations, liabilities and duties relating to the presence or release of pollution or contamination, including pollution or contamination by oil and gas, brine, NORM or other materials or the release or disposal of any hazardous substances, wastes, materials and products generated by or used in connection with the ownership or operation of the Assets (“Assumed Environmental Obligations”).

(E)	Reference is made to that Section 3.4(l) of that Purchase and Sale Agreement dated July 7, 2005 by and between Pioneer Natural Resources USA, Inc. and Maritech Resources, Inc. If prior to Closing Chevron

U.S.A. Inc. or Chevron Corporation, or any applicable subsidiary, agrees to the substitution of Buyer’s letter of credit in the aggregate sum of Seven Million Dollars ($7,000,000) to secure the abandonment of ▇▇▇▇▇ and other asseets as set forth therein (the “Buyer’s Letter of Credit”), in place of Seller’s Parent letter of credit for such obligations (“Seller’s Parent Letter of Credit”), then the Base Purchase Price shall be reduced at Closing by Two Million Dollars ($2,000,000), and Buyer shall post the Buyer’s Letter of Credit. If Chevron U.S.A. Inc. or Chevron Corporation, or any applicable subsidiary, fails or refuses to agree to the substitution of Buyer’s Letter of Credit prior to the Closing, then the Base Purchase Price shall be increased at Closing by Seven Hundred Fifty Thousand Dollars ($750,000), and Seller’s Parent Letter of Credit shall remain in place. If, within five (5) years after Closing, Seller decides to negotiate with Chevron U.S.A. Inc. or Chevron Corporation, or any applicable subsidiary, and the applicable Chevron entity agrees to the substitution of Buyer’s Letter of Credit, then Buyer shall post the Buyer’s Letter of Credit and Seller shall promptly tender to Buyer Two Million Seven Hundred Fifty Thousand Dollars ($2,750,000) in cash.

20.2 Indemnification By Buyer. From and after the Closing, Buyer shall assume, indemnify and hold Seller and its affiliates, and its and their respective directors, officers, employees, attorneys, contractors and agents harmless from and against any and all claims, actions, causes of action, liabilities, damages, costs or expenses (including, without limitation, court costs and consultants’ and attorneys’ fees) of any kind or character (“Damages”) (individually a “Seller’s Indemnified Claim” and collectively “Seller’s Indemnified Claims”) arising out of:

(A)	any misrepresentation or breach of any warranty, covenant or agreement of Buyer contained in this Agreement;

(B)	the ownership and/or operation of the Assets, whether accruing or arising before, on or after the Effective Time, subject to and except for those liabilities retained by Seller pursuant to Section 20.3, as limited by Sections 20.4 and 20.5; and

(C)	the Assumed Obligations.

THE FOREGOING ASSUMPTIONS AND INDEMNIFICATIONS SHALL APPLY WHETHER OR NOT SUCH DUTIES, OBLIGATIONS OR LIABILITIES, OR SUCH CLAIMS, ACTIONS, CAUSES OF ACTION, LIABILITIES, DAMAGES, LOSSES, COSTS OR EXPENSES ARISE OUT OF (i) NEGLIGENCE (INCLUDING SOLE NEGLIGENCE, SIMPLE NEGLIGENCE, CONCURRENT NEGLIGENCE, ACTIVE OR PASSIVE NEGLIGENCE, BUT EXPRESSLY NOT INCLUDING GROSS NEGLIGENCE OR WILLFUL MISCONDUCT) OF ANY INDEMNIFIED PARTY, OR (ii) STRICT LIABILITY.

20.3 Indemnification By Seller. From and after Closing, Seller shall indemnify and hold Buyer (and its directors, officers, employees, attorneys, contractors and agents) harmless

from and against any and all Damages (individually a “Buyer’s Indemnified Claim” and collectively “Buyer’s Indemnified Claims”) arising out of:

(A)	any misrepresentation or breach of any warranty, covenant or agreement of Seller contained in this Agreement;

(B)	the ownership and/or operation of the Assets prior to the Effective Time, excluding, however, the Assumed Obligations;

(C)	any personal or bodily injury (including death) or property damage caused by or attributable to the Assets prior to the Closing Date;

(D)	any mispayment or non-payment of Royalties attributable to the Assets prior to the Effective Time;

(E)	off-site disposal by Seller or its agents, employees, representatives, operators, or contractors of wastes or materials from the Assets occurring prior to Closing; and

(F)	the Excluded Assets.

20.4 Limitation on Seller’s Indemnity Obligations. Seller shall not be required to indemnify Buyer under Sections 20.3(A) through 20.3(E) with respect to any individual Buyer’s Indemnified Claim in an amount less than $50,000 (“Individual Claim Threshold”). Further, Seller shall not be obligated to indemnify Buyer under Sections 20.3(A) through 20.3(F) for Buyer’s Indemnified Claims unless, and then only to the extent that, the aggregate of all of Buyer’s Indemnified Claims exceeds two percent (2%) of the Base Purchase Price (the “Indemnity Deductible”). In addition, in no event shall Seller’s aggregate liability arising out of or related to Buyer’s Indemnified Claims exceed twenty-five percent (25%) of the Base Purchase Price (the “Indemnity Cap”).

20.5 Survival of Provisions. Seller’s representations and warranties contained in this Agreement shall survive the Closing and the delivery of the Conveyance for a period of eighteen (18) months after the Closing Date. Seller’s covenants and obligations under Sections 18.8 and 20.3(F) shall survive the Closing and the delivery of the Conveyance without limitation as to time. Buyer’s representations and warranties and all covenants of Seller and Buyer contained in this Agreement shall survive the Closing and the delivery of the Conveyance without limitation as to time, except for any covenant which by its terms terminates as of a specific date, or is only made for a specified period. Notwithstanding the foregoing, Seller’s representations set forth in Sections 10.1(P) and 10.1(Q) shall terminate on the Closing Date. Each of the survival periods specified in this Section 20.5 is referred to as the “Survival Period.” The indemnity obligations for which a timely and valid notice of claims is made pursuant to Section 20.6 shall continue for so long as the basis underlying such notice continues and until all related claims have been resolved.

20.6 Notice of Claim. If indemnification pursuant to Section 20.2 or 20.3 is sought, the Party seeking indemnification (the “Indemnitee”) shall give written notice to the indemnifying Party during the applicable Survival Period of an event giving rise to the obligation

to indemnify, describing in reasonable detail the factual basis for such claim, and shall allow the indemnifying Party to assume and conduct the defense of the claim or action with counsel reasonably satisfactory to the Indemnitee, and shall cooperate with the indemnifying Party in the defense thereof; provided, however, that the omission to give such notice to the indemnifying Party shall not relieve the indemnifying Party from any liability which it may have to the Indemnitee, except to the extent that the indemnifying Party is prejudiced by the failure to give such notice and as otherwise provided in Section 20.5. The Indemnitee shall have the right to employ separate counsel to represent the Indemnitee if the Indemnitee is advised by counsel that an actual conflict of interest makes it advisable for the Indemnitee to be represented by separate counsel and the reasonable expenses and fees of such separate counsel shall be paid by the indemnifying Party.

20.7 Exclusive Remedy. Upon Closing, the terms and provisions of this Article 20 shall be the sole and exclusive remedy of each of the Parties indemnified hereunder with respect to the claims described in Sections 20.2 and 20.3, including, without limitation, claims arising from breaches of the representations and warranties of the Parties set forth in this Agreement and the other documents executed and delivered hereunder, regardless of whether such claims are based on contract, tort, securities laws, strict liability, or other principles.

ARTICLE 21

MEDIATION AND ARBITRATION

21.1 Mediation and Arbitration.

(A)

If a dispute (other than an accounting dispute subject to Section 3.3 or a dispute subject to Article 7) arises out of or in connection with this Agreement, and if the dispute cannot be settled through negotiation, the Parties agree first to try in good faith to settle the dispute by mediation under the Commercial Mediation Rules of the American Arbitration Association (“AAA”) before resorting to arbitration under this Section or any other Section in this Agreement.

(B)

Except as provided in Section 21.1(A) and for the accounting dispute procedures of Section 3.3 and the Independent Expert procedures of Article 7, the Parties hereby agree to submit all other controversies, claims and matters of difference arising from or relating to this Agreement (“Disputes”) to arbitration. Without limiting the generality of the foregoing, the following shall be considered Disputes for this purpose: (1) all questions relating to the interpretation or breach of this Agreement, (2) all questions relating to any representations, negotiations and other proceedings leading to the execution hereof, and (3) all questions as to whether the right to arbitrate any question exists.

(C)	Arbitration may be initiated by a Party (“Claimant”) serving written notice on the other Party (the “Respondent”) that Claimant elects to refer the Dispute to binding arbitration. Disputes involving claims in an amount less than $500,000.00 shall be determined by a single arbitrator, who shall

be selected by mutual agreement of the Parties. In the event the Parties are unable to agree within fourteen (14) days on an arbitrator, either Party may request the AAA to appoint an arbitrator, giving due regard to the selection criteria set out below. Disputes involving claims in an amount of $500,000 or greater shall be determined by a panel of three (3) arbitrators. Claimant’s notice initiating binding arbitration must identify the arbitrator Claimant has appointed. Respondent shall respond to Claimant within thirty (30) days after receipt of Claimant’s notice, identifying the arbitrator Respondent has appointed. If Respondent fails for any reason to name an arbitrator within the thirty (30) day period, Claimant will name the arbitrator for Respondent’s account. The two (2) arbitrators so chosen shall select a third arbitrator (who must have not less than ten (10) years experience as an oil and gas lawyer) within thirty (30) days after the second arbitrator has been appointed. If the two (2) arbitrators are unable to agree on a third arbitrator within sixty (60) days from initiation of arbitration, then a third arbitrator shall be selected by the AAA office administering the Dispute, with due regard given to the selection criteria above and input from the Parties and other arbitrators. The AAA shall select the third arbitrator not later than ninety (90) days from initiation of arbitration. In the event AAA should fail to select the third arbitrator within ninety (90) days from initiation of arbitration, then either Party may petition the Chief United States District Judge for the Southern District of Texas to select the third arbitrator. Due regard shall be given to the selection criteria above and input from the Parties and other arbitrators.

(D)

All matters arbitrated hereunder shall be arbitrated in Houston, Texas, shall be governed by Texas law, without reference to any choice of law rules, and shall be conducted in accordance with the Commercial Arbitration Rules of the AAA (the “Rules”). The arbitrators shall conduct a hearing no later than sixty (60) days after submission of the matter to arbitration, and a decision shall be rendered by the arbitrators within fifteen (15) days of the hearing. At the hearing, the Parties shall present such evidence and witnesses as they may choose, with or without counsel. Adherence to formal rules of evidence shall not be required but the arbitration panel shall consider any evidence and testimony that it determines to be relevant, in accordance with procedures that it determines to be appropriate. Any award entered in an arbitration shall be made by a written opinion stating the reasons for the award made.

(E)

This submission and agreement to arbitrate shall be specifically enforceable. Arbitration may proceed in the absence of any Party if notice of the proceedings has been given to such Party. The Parties agree to abide by all awards rendered in such proceedings. Such awards shall be final and binding on all Parties to the extent and in the manner permitted under Texas law. All awards may be filed with the clerk of one or more courts, state, federal or foreign having jurisdiction over the Party against whom such award is rendered or its property, as a basis of judgment and

of the issuance of execution for its collection. No Party shall be considered in default hereunder during the pendency of arbitration proceedings relating to such default, but nothing herein shall be deemed to toll the effectiveness of contract provisions relating to the accruing of or rate of interest on amounts not paid when due.

(F)

The arbitrators may award legal and equitable relief, including but not limited to the award of specific performance. With regard to the award of damages, the arbitrators are empowered to award only compensatory damages (which term may include attorney’s fees and costs and compensation for the time value of money). EACH PARTY IRREVOCABLY WAIVES ANY DAMAGES IN EXCESS OF COMPENSATORY DAMAGES, INCLUDING WAIVER OF PUNITIVE AND MULTIPLE DAMAGES. Nothing herein shall prevent a Party from seeking a preliminary injunction or similar preliminary judicial relief if in the good faith judgment of the Party such action is necessary to avoid irreparable damage. Such Party must, however, continue to participate in good faith in the dispute resolution proceedings specified in this Section.

ARTICLE 22

MISCELLANEOUS

22.1 Confidentiality. That certain Confidentiality Agreement between the Parties, dated January 28, 2011 the (“Confidentiality Agreement”), shall survive the execution and delivery of this Agreement, and shall not be superseded hereby. In accordance with the terms of the Confidentiality Agreement, Buyer shall maintain the confidentiality of all due diligence materials concerning the Assets, including, without limitation, engineering, geological and geophysical data, seismic data, reports and maps, and the due diligence results and findings of Buyer (including,, without limitation, due diligence associated with environmental and title matters) and other data relating to the Assets.

22.2 Notice. Any notice, request, demand, or consent required or permitted to be given hereunder shall be in writing and delivered in person or by certified mail, with return receipt requested or by prepaid overnight delivery service, or by facsimile addressed to the Party for whom intended at the following addresses:

SELLER:

Maritech Resources, Inc.

▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇

▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇

Attn: President

Tel: (▇▇▇) ▇▇▇-▇▇▇▇

Fax: (▇▇▇) ▇▇▇-▇▇▇▇

With a Copy to:

TETRA Technologies, Inc.

▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇

▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇

Attn: General Counsel

Tel: (▇▇▇) ▇▇▇-▇▇▇▇

Fax: (▇▇▇) ▇▇▇-▇▇▇▇

BUYER:

▇▇▇▇ Exploration Company LLC

▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇

▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇

Attn: ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇

Tel: ▇▇▇-▇▇▇-▇▇▇▇

Fax: ▇▇▇-▇▇▇-▇▇▇▇

With a Copy to:

▇▇▇▇▇▇▇▇ PC

▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇

▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇

Attn: C. ▇▇▇▇▇ ▇▇▇▇▇▇▇

Tel: (▇▇▇) ▇▇▇-▇▇▇▇

Fax: (▇▇▇) ▇▇▇-▇▇▇▇

And

TRT Holdings, Inc.

▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.

▇▇▇▇▇ ▇▇▇▇

▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇

Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇

Tel: ▇▇▇-▇▇▇-▇▇▇▇

Fax: ▇▇▇-▇▇▇-▇▇▇▇

or at such other address as any of the above shall specify by like notice to the other.

22.3 Press Releases and Public Announcements. No Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement without the prior written approval of the other Party; provided, however, that any Party may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its or its affiliates’ publicly-traded securities (in which case the disclosing

Party shall use all reasonable efforts to advise the other Party, and give the other Party an opportunity to comment on the proposed disclosure, prior to making the disclosure).

22.4 COMPLIANCE WITH EXPRESS NEGLIGENCE RULE. THE PARTIES AGREE THAT, EXCEPT AS MAY OTHERWISE BE EXPRESSLY PROVIDED HEREIN, THE INDEMNIFICATION OBLIGATIONS OF THE INDEMNIFYING PARTY SHALL BE WITHOUT REGARD TO THE NEGLIGENCE OR STRICT LIABILITY OF THE INDEMNIFIED PERSON(S), WHETHER THE NEGLIGENCE OR STRICT LIABILITY IS ACTIVE, PASSIVE, JOINT, CONCURRENT OR SOLE.

22.5 Governing Law. This Agreement is governed by and must be construed according to the laws of the State of Texas, excluding any conflicts-of-law rule or principle that might apply the law of another jurisdiction.

22.6 Exhibits. The Exhibits attached to this Agreement are incorporated into and made a part of this Agreement.

22.7 Fees, Expenses, and Recording.

(A)

Each Party shall be solely responsible for all costs and expenses incurred by it in connection with this transaction (including, but not limited to fees and expenses of its counsel and accountants) and shall not be entitled to any reimbursements from the other Party, except as otherwise provided in this Agreement.

(B)

Buyer shall, at its own cost, promptly record all instruments of conveyance and sale in the appropriate office of the state and parish offshore which the lands covered by such instrument are located. Buyer shall promptly file for and obtain the necessary approval of all federal or state government agencies to the assignment of the Assets. The assignment of any state or federal oil and gas leases shall be filed in the appropriate governmental offices on a form required and in compliance with the applicable rules of the applicable government agencies. Buyer shall supply Seller with a true and accurate photocopy reflecting the recording information of all the recorded and filed assignments within a reasonable period of time after their recording and filing.

22.8 Assignment. Neither this Agreement nor any part hereof (including without limitation any indemnification rights or any obligations or benefits hereunder) may be assigned by either Party without the prior written consent of the other Party and any transfer in absence of such consent shall be null and void; provided, however, upon notice to the other Party, either Party shall have the right to assign all or part of its rights (but none of its obligations) under this Agreement in order to qualify a transfer of the Assets as a “like-kind” exchange for federal tax purposes. After Closing, any permitted assignment of this Agreement by a Party shall not relieve such assigning Party of any of its obligations and responsibilities to the non-assigning Party unless expressly released from same in writing by such non-assigning Party. Subject to the foregoing, this Agreement is binding upon the Parties hereto and their respective successors and

assigns. Notwithstanding the restrictions and requirements of this Section 22.8, prior to Closing, Buyer shall have the right, without Seller’s consent, to assign all of its rights and obligations under this Agreement to an affiliate of Buyer, so long as such affiliated assignee of Buyer has the financial ability to perform Buyer’s obligations under this Agreement. The restrictions on or requirements for assignment in this Section 22.8 shall not limit or apply to Buyer’s (or its successors’ or assigns’) ability to assign all or part of its interest in the Assets after Closing.

22.9 Buyer’s Parent as a Party. Each of Buyer and Seller acknowledges and agrees that Buyer’s Parent is joined in the execution of this Agreement for the sole purpose of ensuring Buyer’s compliance with Section 11.1(G), and Buyer’s Parent shall have no other duties, obligations, responsibilities or liabilities of any kind whatsoever to Seller or otherwise arising out of this Agreement.

22.10 Seller’s Parent as a Party. Each of Buyer and Seller acknowledges and agrees that Seller’s Parent is joined in the execution of this Agreement for the sole purpose of ensuring Seller’s compliance with Section 1.2(N), Section 18.8, Section 18.9, and, only to the extent related thereto, Section 20.5, and Seller’s Parent shall have no other duties, obligations, responsibilities or liabilities of any kind whatsoever to Buyer or otherwise arising out of this Agreement.

22.11 Entire Agreement. This Agreement constitutes the entire agreement reached by the Parties with respect to the subject matter hereof, superseding all prior negotiations, discussions, agreements and understandings, whether oral or written, relating to such subject matter, except the Confidentiality Agreement shall remain in full force and effect in accordance with its terms.

22.12 Severability. In the event that any one or more covenants, clauses or provisions of this Agreement shall be held invalid or illegal, such invalidity or unenforceability shall not affect any other provisions of this Agreement.

22.13 Captions. The captions 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.

22.14 Counterpart Execution. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original, and all of which together shall constitute one and the same instrument.

22.15 Waiver of Certain Damages. The indemnification obligations of the Parties under Article 20 shall be limited to actual losses, and shall not include, and each of the Parties hereby waives and agrees not to seek incidental, consequential, indirect, punitive or exemplary damages with respect to any claim, controversy, or dispute arising out of or relating to this Agreement or the breach thereof, except in the event such damages are awarded to a third party.

22.16 Amendments and Waivers. This Agreement may not be modified or amended except by an instrument in writing signed by both Parties. Any Party hereto may, only by an instrument in writing, waive compliance by another Party with any term or provision of this Agreement on the part of such other Party hereto to be performed or complied with. The waiver

by any Party hereto of a breach of any term or provision of this Agreement shall not be construed as a waiver of any subsequent breach.

22.17 Seller’s Knowledge. For all purposes of this Agreement, “Seller’s knowledge” or words of similar import shall mean the actual knowledge of one or more of the following officers of Seller: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, and ▇▇▇ ▇▇▇▇.

22.18 Like-Kind Exchanges. Buyer shall cooperate fully, as and to the extent reasonably requested by Seller, in connection with the transactions contemplated herein to make such modifications as may be necessary, but at no cost or liability to Buyer, to qualify such transactions, in whole or in part, as a “like-kind” exchange pursuant to Section 1031 of the Code.

22.19 Further Cooperation. At the Closing, and thereafter as may be necessary, Seller and Buyer shall execute and deliver such other instruments and documents and take such other actions as may be reasonably necessary to evidence and effectuate the transactions contemplated by this Agreement.

Executed as of the day and year first above written.

SELLER:

Maritech Resources, Inc.

By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇

▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President

SELLER'S PARENT:

Tetra Technologies, Inc.

By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇

Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇

Title: President & CEO

BUYER:

▇▇▇▇ Exploration Company LLC

By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇

Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇

Title: President

BUYER'S PARENT:

TRT Holdings, Inc.

By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇

Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇

Title: President

Purchase and Sale Agreement Signature Page

EXHIBIT 1.1 (A) - LEASES

Attached to and made a part of that certain Purchase and Sale Agreement dated April 1, 2011, but effective January 1, 2011, by and between Maritech Resources, Inc. and ▇▇▇▇ Exploration Company LLC

AREA

BLOCK

LEASE

STATUS

GROSS ACRES

NET ACRES

OPERATOR

OWNER

CODE

INT.

INT TYPE

ROYALTY % (GROSS)

ADD'L BURDENS % (GROSS)

EFFECTIVE DATE

EXPIRATION DATE

0328

G10638

PROD

5000.00

230

Maritech

Apache

100.00000

16.67

5/1/1989

4/30/1994

5000.00

2500

Maritech (W2; N2NE4; SE4)

Maritech (surf - 3,515' MD)

50.00000

Maritech

Arena Offshore

15.00000

Maritech

Arena Energy

35.00000

5000.00

2500

Arena (S2 NE4)

Maritech (3,515' MD - 4,195' TVD)

50.00000

Arena

Arena Offshore

15.00000

Arena

Arena Energy

35.00000

0342

G02319

PROD

2500.00

266

Chevron USA (Below 10,000' TVD)

Mariner (W2)

50.00000

16.67

2/1/1973

1/31/1978

Chevron USA

Chevron (W2)

50.00000

Mariner Oil

Mariner (E2)

50.00000

Mariner Oil

Apache (E2)

25.00000

2500.00

625

Mariner Oil

Maritech Res (E2)

25.00000

Mariner Oil

Mariner En Res (NW4 Surf - 8,225' TVD)

50.00000

Mariner Oil

Apache (NW4)

25.00000

1250.00

312.5

Mariner Oil

Maritech Res (NW4)

25.00000

Mariner (Surf-10,000')

Apache (SW4)

38.25000

1250.00

478.13

Mariner Oil

Maritech Res(SW4)

38.25000

Mariner Oil

Mariner En Res (SW4)

23.50000

1250.00

Chevron USA DpRt

Mariner (NW4 Below 8225')

50.00000

Chevron USA DpRt

Chevron (NW4)

50.00000

Mariner - DpRts

Mariner (E2)

50.00000

Mariner - DpRts

Apache (E2)

25.00000

2500.00

312.5

Mariner - DpRts

Maritech Res (E2)

12.50000

Mariner - DpRts

Devon Energy (E2)

12.50000

Chevron below 10,000'

Apache (SW/4 - Dp Rts)

38.25000

1250.00

239.06

Chevron below 10,000'

Maritech (SW/4 - Dp Rts)

19.12500

Chevron below 10,000'

Devon En (SW/4 - Dp Rts)

19.12500

Chevron below 10,000'

Mariner (SW/4 - Dp Rts)

23.50000

G21703

SOP thru 4-30-11

4994.55

Maritech Res

Maritech Res W1/2;W1/2E1/2;NE1/4NE1/4;SE1/4SE1/4

100.00000

16.67

5/1/2000

4/30/2005

Sojitz

0.00000

Maritech Res

Maritech Res SE/4 NE/4; NE/4 SE/4

100.00000

Maritech Res

Maritech Res NE1/4SE1/4; SE1/4NE1/4 surf - 13,680 MD

25.00000

Mariner

75.00000

Maritech Res NE1/4SE1/4; SE1/4NE1/4 Depths Below 13,680 MD

100.00000

160

G05245

SOP thru 8-31-11

1248.64

749.18

Maritech

Chevron USA Inc.

50.00000

16.67

13.00

4/1/1983

3/31/1988

▇▇▇▇▇▇ Petroleum

50.00000

▇▇

▇▇▇▇▇▇ Petroleum

▇▇▇▇▇▇ Petroleum Surf - 6110 TVD

100.00000

Chevron USA Inc. Depths Below 6110' TVD

50.00000

▇▇▇▇▇▇ Petroleum

50.00000

Maritech

Maritech - S/2S/2 surf-3800' SS

60.00000

W&T OFFSHORE

40.00000

163

G07809

SOP thru 4-30-11

4994.55

2996.73

Maritech Res - surf-10,100' TVD

▇▇▇▇▇▇ Petroleum

100.00000

16.67

8.33

7/1/1985

6/30/1990

Maritech Res - surf-10,100' TVD

Callon Pet - Surf-5,499' TVD

100.00000

Maritech Res - surf-10,100' TVD

Maritech - 5,500' TVD-10,100' SS

60.00000

W&T Offshore

40.00000

Callon Pet - Below 10,100' SS

100.00000

175

G08753

180-day clock thru 3/25/11

4994.55

128

Maritech Res

100.00000

16.67

4.00

8/1/1987

7/1/1992

Platform will become a RUE

Maritech Res

Maritech Res - surf to 4000'

100.00000

Maritech Res - below 4000'TVD - 50,000'TVD

Maritech Res

21.24993

Maritech Res

Devon Energy

21.24992

Maritech Res

Fairways

50.00000

Maritech Res

Fidelity

7.50015

▇▇▇

▇▇▇ moved to Exhibit 1.1 D Easements-ROW

185

G25033

SOP thru 4-30-11

4994.55

2330.79

Maritech Res

46.66000

16.67

2.00

5/1/2003

4/30/2008

W&T Offshore

33.34000

Energy Res Tech GOM

20.00000

187

G26157

Lse held by 180-day clock thru 03-25-2011

4994.55

Maritech Res

100.00000

16.67

2.00

6/1/2004

5/31/2009

200

G23979

SOP thru 4-30-11

4994.55

2497.28

Maritech Res

50.00000

16.67

2.00

6/1/2002

5/31/2007

Energy Res Tech GOM

50.00000

207

G22802

SI 12/16/10

4994.55

2497.28

Maritech Res

50.00000

16.67

2.00

7/1/2001

6/30/2006

180-DAY CLOCK TO 06/13/2011

Energy Res Tech GOM

50.00000

Maritech Res S1/2N1/2; N1/2N1/2S1/2 surf - 6100' TVD

40.00000

Energy Res Tech GOM

40.00000

Sojitz

20.00000

Maritech Res S2N2 Below 3,270 TVD

50.00000

Energy Res Tech GOM

50.00000

211

G22803

SI 12-08-10

4994.55

2497.28

Maritech Res

50.00000

16.67

2.00

5/1/2001

4/30/2006

180-DAY CLOCK TO 06/05/2011

Energy Res Tech GOM

50.00000

229

G32253

Primary Term

4994.55

Maritech Resources

Maritech Res

100.00000

18.75

7/1/2008

6/30/2013

232

G22806

SI 12-08-10

4994.55

2497.28

Maritech Res

50.00000

16.67

2.00

7/1/2001

6/30/2006

180-day Clock to 06/05/2011

Energy Res Tech GOM

50.00000

233

G23988

PROD

4994.55

1623.23

Energy Res Tech GOM

35.00000

16.67

2.00

7/1/2002

6/30/2007

Maritech Res

32.50000

Implicit

32.50000

235

G32255

Primary Term

4994.55

Maritech Res

100.00000

18.75

8/1/2008

7/31/2013

241

G22808

PROD

4994.55

2497.28

Maritech Res

50.00000

16.67

2.00

7/1/2001

6/30/2006

Energy Res Tech GOM

50.00000

279

G26168

PROD

4994.55

575.37

W&T

88.50000

16.67

7/1/2004

6/30/2009

Maritech Res

10.00000

16.67

5.00

Maritech Res

1.50000

16.67

T Bay

01772

PROD

2120.92

Maritech T-Bay

100.00000

14.58333

3.00

3/2/1950

Part Rel 11-08-78 -1,490 acs; Orig Lse 3,610.00 acs

T Bay

01773

PROD

97.44

Maritech T-Bay

100.00000

14.58333

3.00

3/2/1950

T Bay

00192

PROD

6000.00

Maritech T-Bay

100.00000

12.50

15.50

2/20/1928

T Bay

2243

SWD Lse

3.00

Maritech T-Bay

100.00000

1/1/2004

1/1/2014

T Bay

2507

SWD Lse

3.00

Maritech T-Bay

100.00000

1/1/2007

1/1/2017

T Bay

19926

1120.64

Maritech T-Bay

100.00000

22.50

12/10/2008

12/10/2013

T Bay

19953

239.32

Maritech T-Bay

100.00000

22.50

12/10/2008

12/10/2011

T-Bay

20011

209.47

Maritech T-Bay

100.00000

22.50

1/14/2009

1/14/2012

T Bay

4467