PURCHASE AND SALE AGREEMENT by and between CHESAPEAKE APPALACHIA, L.L.C. (the Seller) and SOUTHWESTERN ENERGY PRODUCTION COMPANY (the Buyer) October 14, 2014

This PURCHASE AND SALE AGREEMENT (this “Agreement”) is entered into this 14^th day of October, 2014 (“Execution Date”), between CHESAPEAKE APPALACHIA, L.L.C., an Oklahoma limited liability company (the “Seller”), and SOUTHWESTERN ENERGY PRODUCTION COMPANY, a Texas corporation (the “Buyer”). The Buyer and the Seller are referred to herein, individually, as a “Party” and, collectively, as the “Parties”.

WHEREAS, the Seller desires to sell and the Buyer desires to purchase all of the Seller’s right, title and interest in and to the Properties (as hereinafter defined); and

WHEREAS, the purchase and sale of the Properties will be consummated on the terms and conditions set forth in this Agreement;

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

1.Definitions and References. Capitalized terms used throughout this Agreement including the Recitals above and not defined in Section 1.1 below shall have the meaning ascribed to them elsewhere in this Agreement.

“AAA” means the American Arbitration Association.

“Accounting Referee” means BDO USA, LLP, or such other nationally recognized accounting firm mutually agreed upon by the Parties; provided, however, that if BDO USA, LLP will not serve as the Accounting Referee and the Parties have not mutually agreed on another Accounting Referee within thirty (30) days after the date on which a candidate for a replacement Accounting Referee is first proposed in writing by either Party, then the Accounting Referee shall be selected by the AAA from firms that shall not have performed any work for either of the Parties or any of their respective Affiliates during the five (5) year period preceding such selection.

“Affiliate” means, with respect to any Person, any other Person that directly or indirectly (through one or more intermediaries or otherwise) Controls, is Controlled by, or is under common Control with the first Person.

“Aggregate Defect Threshold” has the meaning specified in Section 2.1.2.

“Allocated Value” means, with respect to a Property, the portion of the Purchase Price allocated to such Property as shown on Exhibit A, provided however that

such Allocated Value is only attributable to the portion of such Property as to which the term Defensible Title applies.

“Arbitrable Dispute” means (except for: (i) disputes involving Title Defects or Environmental Defects or any cure relating thereto, or involving Title Benefits, each of which will be resolved as provided in Section 2.1.11, or (ii) any matters to be resolved by the Accounting Referee as provided in Section 2.8) any and all disputes, claims, counterclaims, demands, causes of action, controversies and other matters in question arising out of or relating to this Agreement or the alleged breach hereof, or in any way relating to matters that are the subject of this Agreement or the transactions contemplated hereby or the relationship between the Parties created by this Agreement, regardless of whether (a) allegedly extra-contractual in nature, (b) sounding in contract, tort or otherwise, (c) provided for by Law or otherwise, or (d) seeking damages or any other relief, whether at Law, in equity or otherwise.

“Assignment” means (a) the Assignment, Bill of Sale and Conveyance in substantially the same form attached hereto as Exhibit B-1 with respect to the Properties other than the Other Assets and the Transferred Gathering Systems; and (b) the Assignments in substantially the same forms attached hereto as Exhibit B-2 with respect to the Other Assets and the Transferred Gathering Assets.

“Assumed Obligations” means: (a) all claims, demands, violations, actions, assessments, penalties, fines, liabilities, costs, expenses, duties and obligations of every kind and character with respect to the Properties or to the ownership, use, operation or other disposition thereof for periods from and after the Effective Time, including, without limitation, under the terms of all oil, gas and mineral leases, easements and similar agreements constituting part of the Properties, as well as under the terms and provisions of all Contracts constituting part of the Properties, including, without limitation, any Contracts entered into by the Seller after the Execution Date and prior to Closing which are both attributable to, and constitute part of, the Properties and are entered into in compliance with Section 5.2; (b) all liabilities, costs, expenses, duties and obligations of every kind and character with respect to the Properties or to the ownership, use, operation or other disposition thereof, whether or not attributable to periods before or after the Effective Time, arising out of or relating to: (i) Gas Imbalances, (ii) the payment of the balance of the Suspended Funds, (iii) all real estate, use, occupation, ad valorem, severance, production and personal property taxes on the Properties for calendar year 2014 and thereafter (it being acknowledged that such taxes for calendar year 2014 are being prorated pursuant to Section 2.6(b)), (iv) all liabilities, costs, expenses, duties and obligations to properly plug and abandon and decommission wells, flowlines, gathering lines or other facilities, equipment or other personal property or fixtures located on or comprising part of the Properties; and (v) all liabilities, costs, expenses, duties and obligations to restore the surface of Real Property Interests or the Lands and any other obligations relating to the failure of the Properties or the ownership or operation thereof to

comply with Environmental Laws, including any and all obligations to bring the Properties into compliance with applicable Environmental Laws (including conducting any remediation activities that may be required on or otherwise in connection with activities on the Properties), regardless of whether such obligations or conditions or events giving rise to such obligations, arose, occurred or accrued before or after the Effective Time; (c) all losses, claims, liabilities, demands, costs and expenses arising out of, incident to or in connection with the accounting for, failure to pay or the incorrect payment to any royalty owner, overriding royalty owner, working interest owner or other interest holder under the Lands and/or units comprising a part of the Properties insofar as the same are attributable to periods and Hydrocarbons produced and marketed with respect to the Properties from and after the Effective Time; and (d) the DA Assumed Obligations, if applicable pursuant to the terms of Section 5.14.

“ATEX Agreement” has the meaning specified in Section 5.8.1.

“Basket” has the meaning specified in Section 10.7.1.

“Business Day” means any day other than Saturday or Sunday or a day on which banking institutions in Oklahoma City, Oklahoma or Houston, Texas are authorized by Law to close.

“Buyer Indemnified Parties” has the meaning specified in Section 10.2.

“Casualty” means volcanic eruptions, acts of God, terrorist acts, fire, explosion, gathering line failure, earthquake, wind storm, flood, drought, condemnation, the exercise of eminent domain, confiscation or seizure.

“Casualty Loss” has the meaning specified in Section 2.4.

“CEMI” means Chesapeake Energy Marketing, Inc. or other hydrocarbon marketing Affiliate of the Seller.

“Claimant” has the meaning specified in Section 13.2.

“Closing” means the closing and consummation of the transactions contemplated by this Agreement.

“Closing Date” means the date on which the Closing occurs, which will be the later of (a) December 9, 2014, and (b) the date that is ten (10) Business Days after the date on which all of the conditions to Closing set forth in Sections 6 and 7 (other than those that, by their nature, are satisfied at Closing) have been satisfied (or waived in writing), unless otherwise changed by the mutual written agreement of the Parties.

“Closing Statement” has the meaning specified in Section 2.7.

“Confidentiality Agreement” means that certain confidentiality agreement dated July 17, 2014, executed by the Parties or their Affiliates.

“Consent Decree Agreement” means the Consent Decree Agreement in the form attached hereto as Exhibit D to be entered into between the Seller and the Buyer regarding the Seller’s retention of liabilities and certain rights with respect to the Seller’s performance under that certain Consent Decree issued by the United States District Court for the Northern District of West Virginia on March 11, 2014.

“Consultant” has the meaning specified in Section 2.1.11.

“Contract Area” means, with respect to the Lands, the area outlined on the map attached hereto as Schedule 1.2.

“Contracts” has the meaning specified in the definition of Properties.

“Control” means the possession, directly or indirectly, of the power, directly or indirectly, to direct or cause the direction of the management or policies of the controlled Person, whether through the ownership of equity interests in or voting rights attributable to the equity interests in such Person, by contract or agency, by the general partner of a Person that is a partnership, or otherwise; and “Controls” and “Controlled” have meanings correlative thereto.

“Cure Period” has the meaning specified in Section 2.1.10.

“Customary Post-Closing Consents” has the meaning specified in the definition of Permitted Encumbrances.

“DA Assumed Obligations” has the meanings specified in Section 5.14.

“Defect Notice” has the meaning specified in Section 2.1.

“Defect Notice Date” has the meaning specified in Section 2.1.

“Defensible Title” means title that, although not constituting perfect, merchantable or marketable title, is evidenced by instruments filed of record or other documentation so as to be sufficient against competency claims of bona fide purchasers for value or other persons entitled to protection of applicable recording laws, which, as of the Closing Date: (a) relative to a Real Property Interest, entitles the Seller to receive throughout the productive life of such Real Property Interest not less than the NRI shown for such Real Property Interest on Exhibit A in and to all Hydrocarbons produced and saved or sold from or allocated to the Marcellus Formation, and, if within the Utica Area, the Utica Formation of such Real Property Interest, and if relative to a Well, entitles the Seller to receive throughout the productive life of such Well not less than the NRI shown for such Well on Exhibit A in and to all Hydrocarbons produced and saved or sold from or allocated to the Producing Formation for such Well (except, in the case of each of

the foregoing, for (i) decreases in connection with any operation in which the owner of such Property may elect after the Closing to be a non-consenting co-owner, (ii) decreases resulting from the establishment after the Execution Date of pools or units and (iii) decreases required to allow other working interest owners, pipelines or plants to make up past underproduction); (b) obligates the Seller to bear, with respect to a Well, not greater than the Working Interest set forth in Exhibit A allocated to the Producing Formation of such Well, except increases in such Working Interest that result in at least a proportionate increase in the Seller’s NRI for such Well; (c) entitles the Seller to not less than the respective number of Net Acres shown on Exhibit A for a Real Property Interest with respect to the Marcellus Formation and, if within the Utica Area, the Utica Formation of such Real Property Interest; (d) with respect to any interest not yet earned under a farm-out agreement, entitles the Seller to the right to earn the interest described in Exhibit A in accordance with the terms of such farm-out agreement; (e) subject to Permitted Encumbrances, is free and clear of all Liens; and (f) with respect to a Real Property Interest, is not subject to an Early Lease Expiration.

“Deposit” has the meaning specified in Section 2.

“Development Agreement” means that certain Development Agreement dated November 24, 2008, as amended, entered into between the Seller and SUSA.

“DOJ” has the meaning specified in Section 5.6.

“Dollar” means the United States of America dollar.

“Early Lease Expiration” means, with respect to a Real Property Interest, that (a) such Real Property Interest is not being held by production or operations, and is not capable of being held beyond the primary term thereof by payment of delay rentals, shut-in payments, or by any other means pursuant to the terms of such Real Property Interest (other than by either drilling a new well on such lease or by paying an option fee to extend the term of the lease beyond the expiration date thereof), and (b) assuming the full and timely payment of all rentals and royalties, and except as a consequence of any breach or default under such Real Property Interest by the Buyer or any of its successors-in-interest, such Real Property Interest will expire pursuant to the terms thereof prior to both (i) the expiration date set forth for such Real Property Interest on Exhibit A and (ii) eighteen (18) months following the Effective Time.

“Easements” has the meaning specified in the definition of Properties.

“Effective Time” means 7:00 a.m. Central Time, July 1, 2014.

“Environmental Claim” has the meaning specified in Section 3.9.2.

“Environmental Defect” means a violation of applicable Environmental Laws existing prior to the Closing Date on or under any Real Property Interest or other Property that requires, if known, or will require, once discovered, reporting to a

Governmental Authority, investigation, monitoring, removal, cleanup, remediation, restoration or correction under Environmental Laws.

“Environmental Law” means any Law relating to the environment, health and safety, hazardous materials, industrial hygiene, Hydrocarbon well construction, the environmental conditions on, under, or about any of the Properties, including soil, groundwater, and indoor and ambient air conditions or the reporting or remediation of environmental contamination and includes, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act, including the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. § 9601 et seq.; the Resource Conservation and Recovery Act, including the Hazardous and Solid Waste Amendments Act of 1984, 42 U.S.C. § 6901 et seq.; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. § 1471 et seq.; the Toxic Substances Control Act, 15 U.S.C. §§ 2601 through 2629; the Oil Pollution Act, 33 U.S.C. § 2701 et seq.; the Emergency Planning and Community Right to Know Act, 42 U.S.C. § 11001 et seq.; the Safe Drinking Water Act, 42 U.S.C. §§ 300f through 300j; the Rivers and Harbors Act of 1899, 33 U.S.C. § 401 et seq.; and the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; as any of the foregoing may be amended and any other Law the purpose of which is to conserve or protect human health, the environment, wildlife or natural resources.

“Excluded Assets” means: (a) the Seller’s minute books, financial and income tax records and legal records (other than title records); (b) any existing or future refund of costs, Taxes or expenses borne by any of the Seller, its Affiliates or its or their respective predecessors in title attributable to the period prior to the Effective Time; (c) any and all proceeds from production and from the settlements of contract disputes with purchasers of Hydrocarbons or byproducts from the Lands, including settlement of take-or-pay disputes, insofar as said proceeds are attributable to periods of time prior to the Effective Time; (d) all rights and interests of the Seller or any of its Affiliates (i) under any policy or agreement of insurance or indemnity (including any rights, claims or causes of action of the Seller and its Affiliates against Third Parties under any indemnities or hold harmless agreements and any indemnities received in connection with the Seller’s or any of its Affiliates’ prior acquisition of any of the Properties) to the extent and only to the extent such rights and interests relate to the ownership of the Properties prior to the Effective Time and (ii) under any bond; (e) all Hydrocarbons produced from the Properties with respect to all periods prior to the Effective Time and all proceeds from the disposition thereof other than inventory for which an adjustment is made under Section 2.5(a); (f) all of the Seller’s and its Affiliates’ proprietary computer software, patents, trade secrets, copyrights, names, trademarks, logos and other intellectual property; (g) all accounts receivable and audit rights arising under any of the applicable contracts or otherwise with respect to the Properties with respect to any period prior to the Effective Time or to any of the Excluded Assets, except for any Gas Imbalances; (h) (i) all Geological and Geophysical Information (provided however that Seller

shall grant to Buyer at Closing a license to all proprietary seismic data owned by Seller within the Contract Area), and (ii) all other information which the Seller is prohibited from sharing by agreement with a Third Party; (i) all claims of the Seller or any of its Affiliates for refunds of or loss carry forwards with respect to (1) production, ad valorem or any other Taxes attributable to any period prior to the Effective Time, (2) income or franchise taxes, or (3) any Taxes attributable to the Seller’s Excluded Assets; (j) (1) all “virtual courthouses” of the Seller or any of its Affiliates,(2) all of the Seller or any of its Affiliates respective exclusive use arrangements with title abstract facilities and all documents and instruments of the Seller or any of its Affiliates that may be protected by an attorney-client privilege and (3) all data that cannot be disclosed to the Buyer as a result of confidentiality arrangements under agreements with Third Parties (other than title opinions and other title records relating to the Properties); (k) all surface fee interests, surface leasehold and other surface property interests and all buildings, offices, field offices and yards (but excluding the Other Assets and Easements); (l) all non-Lease Owned equipment, including compressors on the wellheads of the Wells operated by the Seller or its Affiliates owned by or leased from MidCon Compression, L.L.C. or Third Parties; (m) automation systems including meters and related telemetry, licensed radio frequencies and associated communications infrastructure including towers, antennas, data links and network circuits, except any such items which are Lease Owned equipment; (n) all drilling rigs and related equipment, work over rigs and related equipment, tools and other equipment brought onto a well site temporarily for purposes of drilling, reworking or maintaining a well, all vehicles, and any other non-Lease Owned equipment, inventory, machinery, tools and other personal property; (o) all non-Lease Owned salt water disposal wells, systems and related equipment and clean water wells, systems and equipment (but excluding any such items included in the Other Assets); (p) all Gathering Assets except for the Transferred Gathering Systems; (q) (1) all mineral interests and lessor royalties owned by the Seller and its Affiliates including, without limitation, any and all mineral interests burdened by or relating to any of the Real Property Interests or burdened by other oil, gas and mineral leases, and (2) all overriding royalty interests owned by the Seller or its Affiliates, to the extent they do not, individually or in the aggregate, reduce the Seller’s interest in any Property below the Net Revenue Interest for such Property as described in Exhibit A; (r) all rights, title and interest of the Seller under the Development Agreement (except as and to the extent described in Section 5.14); (s) the Midstream Consent Contracts not transferred pursuant to Section 5.8.2; (t) the ATEX Agreement; and (u) the FERC Jurisdictional Contracts, unless assigned to the Buyer pursuant to the terms of Section 5.11.

“Execution Date” has the meaning specified in the introductory paragraph.

“Expiration Date” has the meaning specified in Section 14.3.

“Fee Mineral Lease” one or more oil, gas and mineral leases to be entered into at Closing in the form attached hereto as Exhibit E with Seller and/or its Affiliates as Lessor and Buyer as Lessee covering the fee minerals described on Exhibit A

under the heading Fee Mineral Lease, to the extent they cover the lands described on Exhibit A.

“FERC Jurisdictional Contracts” has the meaning specified in Section 5.11.1.

“FERC Waivers” has the meaning specified in Section 5.11.1.

“Final Statement” has the meaning specified in Section 2.8.

“Finance Related Parties” means the respective Affiliates, officers, directors, employees and representatives of the Financing Sources, any lender participating in the Financing and permitted successors and assigns of the Financing Sources, but specifically excluding the Buyer and its Affiliates, and its and their respective officers, directors, employees, representatives, successors and assigns.

“Financing” means the debt financing which the Financing Sources, subject only to the terms and conditions set forth in the Financing Commitment, have committed to provide or cause to be provided to the Buyer in the amounts set forth therein in connection with the transactions contemplated hereby.

“Financing Commitment” means the financing commitment set forth in that certain Commitment Letter, dated October 14, 2014, provided to the Buyer and its Affiliates in connection with the Financing.

“Financing Sources” means the financial institutions identified in the Financing Commitment.

“FTC” has the meaning specified in Section 5.6.

“G&G Licenses” has the meaning specified in the definition of Properties.

“GAAP” means generally accepted accounting principles, consistently applied, as recognized by the U.S. Financial Accounting Standards Board (or any generally recognized successor). The requisite that such principles be consistently applied means that the accounting principles in a current period are comparable in all material respects to those applied in preceding periods.

“Gas Imbalances” means any gas production, pipeline, storage, processing, transportation or other imbalance or unsatisfied through-put obligations attributable to Hydrocarbons produced from the Seller’s interest in the Lands.

“Gathering Assets” means all of the gathering lines, flow lines, gas lines, gas processing and gathering line compression facilities, processing plants, storage rights and transportation capacity (including downstream transportation capacity), tubing, pumps, motors, gauges, meters, valves, SCADA and other automation equipment and other machinery and equipment constituting part of or comprising the gas gathering systems or assets owned by any Affiliate of Chesapeake Energy Corporation, including all of the rights of way, surface interests, surface lease

agreements, surface use agreements, railroad crossings, easements and similar real estate interests related thereto and all contracts, Permits, pipeline and plant imbalances, and Records relating to the ownership, operation or maintenance.

“Geological and Geophysical Information” means engineering, geological and/or geophysical studies (including seismic data, studies, analyses and interpretations), and other similar information and records, in each case relating to the Properties.

“Governmental Authority” means any foreign, national, state, local, municipal, tribal or other government or division thereof; any governmental, regulatory or administrative agency, commission, body or other authority exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal or arbitrator.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the applicable rules and regulations promulgated thereunder.

“Hydrocarbons” means crude oil, natural gas, casinghead gas, condensate, natural gas liquids, and other liquid or gaseous hydrocarbons.

“Individual Claim” has the meaning specified in Section 10.7.1.

“Individual Defect Threshold” has the meaning specified in Section 2.1.1.

“Knowledge” of a fact or matter means the actual knowledge with respect to such fact or matter of any of the following listed individuals, following reasonable inquiry: (a) with respect to the Buyer, the individuals listed in subpart 1 of Schedule 1.1, and (b) with respect to the Seller, the respective individuals listed in subpart 2 of Schedule 1.1.

“Lands” means the lands covered by the Real Property Interests and all lands pooled or unitized therewith.

“Late Lease Expiration” means, with respect to a Real Property Interest, that (a) as of the Execution Date such Real Property Interest is neither being held by production or operations nor is capable of being held beyond the primary term thereof by payment of delay rentals, shut-in payments, or by any other means pursuant to the terms of such Real Property Interest (other than by either drilling a new well on such lease or by paying an option fee to extend the term of the lease beyond the expiration date thereof), (b) assuming the full and timely payment of all rentals and royalties and except as a consequence of any breach or default under such Real Property Interest by the Buyer or any of its successors-in-interest, the actual expiration date of such Real Property Interest set forth in the applicable lease is later than the expiration date set forth for such Real Property Interest on Exhibit A, and (c) the expiration date set forth for such Real Property Interest on Exhibit A is prior to the date that is eighteen months following the Effective Time.

“Laws” means any and all applicable laws, statutes, ordinances, permits, decrees, writs, injunctions, orders, codes, judgments, principles of common law, rules or regulations (including Environmental Laws) which are promulgated, issued or enacted by a Governmental Authority having jurisdiction.

“Lease Owned” means any personal property or fixture asset in which the Seller owns an interest related to the operation of a Well or Wells which was charged to the joint account of the working interest owners in such Well or Wells, excluding items considered part of overhead; provided, however that “Lease Owned” does not include any “Excluded Assets”.

“Lien” means any lien, mortgage, security interest, pledge, charge or encumbrance or other arrangements substantially equivalent thereto, but does not include any production payment, net profits interest, overriding royalty interest or similar interest to the extent any such interest does not reduce the Seller’s NRI below that shown for the Seller on Exhibit A.

“Log” has the meaning specified in the definition of Marcellus Formation.

“Marcellus Formation” means, the geological formations that are known as the Marcellus Shale formations, which generally include the stratigraphic equivalent of the formations found in the James Messenger ETZ 3H U well (API#4710302973) located in Wetzel County, West Virginia, with the top (being the top of the Marcellus Shale formation) at the correlative stratigraphic equivalent to that point found at a measured depth of 7,298 feet on the Gamma-Ray (GM) log of such well (the “Log”) and the base (being the top of the Onondaga formation) at the correlative stratigraphic equivalent to that point found at a measured depth of 7,346 feet on the Log, recognizing that the actual depth will vary across the Lands.

“Marketing Rate” has the meaning specified in Section 5.11.2.

“Material Adverse Effect” means any result, consequence, condition, or matter which (a) materially adversely affects or could be reasonably expected to materially adversely affect the Seller’s Properties or the operations, rights, results of operations or the value of the Properties, taken as a whole, or (b) materially impairs, prevents or materially delays the Seller’s ability to perform its obligations under the Transaction Documents or to consummate the transactions contemplated by this Agreement; provided, however, that, in any event, the following shall not be deemed to constitute, create or cause a Material Adverse Effect: any changes, circumstances or effects (i) that affect generally the oil and gas industry, such as fluctuations in the price of oil and gas, or that result from international, national, regional, state or local economic conditions, from general developments or from other general economic conditions, facts or circumstances, including changes in Tax policy or other fiscal conditions, that are not subject to the control of the relevant Party, (ii) that result from any of the transactions contemplated in this Agreement or the public announcement thereof, or (iii) that

result from conditions or events resulting from an outbreak or escalation of hostilities, whether nationally or internationally, or the occurrence of any other calamity or crisis, whether nationally or internationally, including the occurrence of one or more terrorist attacks.

“Material Contracts” has the meaning specified in Section 3.8.1.

“Midstream Agreements” has the meaning specified in Section 5.8.3.

“Midstream Assignments” has the meaning specified in Section 5.8.3.

“Midstream Consent Contracts” has the meaning specified in Section 5.8.2.

“Net Acres” means, as calculated separately with respect to each Real Property Interest, (a) the number of gross acres of land covered by such leasehold interest, multiplied by (b) the lessor’s interest in the Marcellus Formation Hydrocarbons and, if such land lies within the Utica Area, the Utica Formation Hydrocarbons in the lands covered by such leasehold interest, multiplied by (c) the Seller’s undivided interest in such leasehold interest (provided, however, if items (b) and (c) vary as to different areas of such lands covered by such leasehold interest, a separate calculation shall be performed with respect to each such area).

“Net Revenue Interest” (or “NRI”) means, with respect to the Real Property Interests, the decimal interest in and to all production of the Marcellus Formation Hydrocarbons within the Contract Area and, if applicable, the Utica Formation Hydrocarbons within the Utica Area of such Real Property Interest, and with respect to any Well, the decimal interest in and to all production of Hydrocarbons from the respective Producing Formation, in the case of each of the foregoing, that are produced and saved or sold from or allocated to the relevant Property after giving effect to all valid lessors’ royalties, overriding royalties and/or other burdens against production.

“NORM” has the meaning specified in Section 5.9.3.

“Ordinary Course of Business” means in the ordinary course of business consistent with past custom and practice.

“Other Assets” means those real and personal property assets and other rights and interests described on Exhibit A-1.

“Party” and “Parties” have the meanings specified in the introductory paragraph.

“Permits” has the meaning specified in the definition of Properties.

“Permitted Encumbrances” means (a) royalties, overriding royalties and similar burdens on production to the extent they do not, individually or in the aggregate, reduce the Seller’s NRI or increase the Seller’s Working Interest (without at least a proportionate corresponding increase in the Seller’s NRI) in any Property from

that shown for the Seller on Exhibit A; (b) Liens for Taxes for which payment is not due or which are being contested in good faith by appropriate proceedings; (c) Liens of mechanics, materialmen, warehousemen, landlords, vendors, and carriers and any similar Liens arising by operation of Law which, in each instance, arise in the Ordinary Course of Business, for sums not yet due or which are being contested in good faith by appropriate proceedings; (d) operating agreements, unit agreements, unitization and pooling designations and declarations, and all other Contracts that either are not Material Contracts or are listed in Schedule 3.8 to the extent they do not, individually or in the aggregate, reduce the Seller’s NRI or increase the Seller’s Working Interest (without at least a proportionate corresponding increase in the Seller’s NRI) in any Property from that shown for the Seller on Exhibit A; (e) easements, surface leases, and other rights and plat restrictions, zoning laws, restrictive covenants and conditions, regulatory authority of Governmental Authorities, and building and other land use laws and similar encumbrances; (f) all rights to consent by, required notices to, filings with or other actions by Governmental Authorities in connection with the sale, disposition, transfer or conveyance of federal, state, tribal, or other governmental oil and gas leases or interests therein or related thereto, or the transfer of operations of any of the Wells, where the same are customarily obtained subsequent to the assignment, disposition or transfer of such oil and gas leases or interests therein, or such operations (“Customary Post-Closing Consents”); (g) conventional rights of reassignment obligating the lessee to reassign or offer to reassign its interests in any lease prior to a release or abandonment of such lease; (h) required non-governmental Third Party consents to assignments which have been obtained or waived by the appropriate parties or which cannot be unreasonably withheld, and preferential rights to purchase which have been waived by the appropriate parties or for which the time period for asserting such rights has expired without the exercise of such rights; (i) rights of tenants-in-common in and to the Properties; (j) all defects or irregularities of title, if any, affecting the Seller’s Properties which do not, individually or in the aggregate, adversely interfere in any material way with the present or future operation or use of the Properties subject thereto or affected thereby and which would be accepted by a reasonably prudent and sophisticated buyer engaged in the business of owning, developing and operating oil and gas properties in the same geographical location with knowledge of all the facts and appreciation of their legal significance; (k) all defects or irregularities (i) arising out of lack of corporate authorization or a variation in corporate name, (ii) that have been cured or remedied by applicable statutes of limitation or statutes for prescription, (iii) consisting of the failure to recite marital status in documents or omissions of heirship proceedings, (iv) that have been cured by possession under applicable statutes of limitation, (v) resulting from lack of survey or failure to record releases of liens, production payments or mortgages that have expired by their own terms or the enforcement of which are barred by applicable statutes of limitation, or (vi) to the extent affecting any depths other than the Marcellus Formation, and if within the Utica Area, the Utica Formation, or if relative to a Well, the Producing Formation for such Well; (l) rights vested in or reserved to any Governmental

Authority to regulate the Properties, to terminate any right, power, franchise, license or permit afforded by such Governmental Authority, or to purchase, condemn or expropriate any of the Properties; (m) requirements to coordinate activities and operations with those having coal, gas storage, utility, timber or other similar rights and operations on, above or below the Properties and any drilling and operating limitations to which the Properties may be subject by reason of rights in favor of any such surface or subsurface owners or operators arising as a matter of law or regulation or pursuant to the terms or provisions of any Real Property Interests or of any Contracts listed on Schedule 3.8; and (n) “free gas” arrangements for household or agricultural or domestic or similar use under the terms of any oil and gas lease that is part of the Properties.

“Person” means an individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or other entity or Governmental Authority.

“Pipeline Waivers” has the meaning specified in Section 5.11.1.

“PPR” has the meaning specified in Section 2.2.

“Proceedings” means any and all proceedings, suits, causes of action and administrative proceedings by or before any Governmental Authority.

“Producing Formation” means, with respect to the wellbore of any Well, each geological zone and depth open to production from which Hydrocarbons are being produced as of the Effective Time.

“Properties” means the Seller’s and its Affiliates’ right, title and interest in and to the following (but excluding the Excluded Assets): (a) the oil, gas and mineral leases shown on Exhibit A, and the operating rights, working interests, net revenue interests, and other rights to Hydrocarbons therein, whether producing or non-producing (“Real Property Interests”); (b) the oil and gas wells shown on Exhibit A (“Wells”), and all Lease Owned tangible personal property, equipment, fixtures and improvements, including all injection wells, salt water disposal facilities, well heads, casing, tubing, pumps, motors, gauges, valves, heaters, treaters, water lines, vessels, tanks, boilers, separators, treating equipment, compressors, other equipment, automation systems including meters and related telemetry on wells, power lines, telephone and communication lines and other appurtenances owned in connection with production, treating, storing, transportation or marketing of Hydrocarbons from the Wells, to the extent each of the foregoing is Lease Owned; (c) all presently existing unitization, pooling and/or communitization agreements, declarations or designations and statutorily, judicially or administratively created drilling, spacing and/or production units, whether recorded or unrecorded, insofar as the same are attributable or allocated to the Lands, and the Seller’s interest in and to the properties covered or units created thereby which are attributable to the Real Property Interests; (d) all presently existing and valid Hydrocarbon sales agreements, operating agreements,

gathering agreements, transportation agreements, farmout and farmin agreements, unitization, pooling and communitization agreements, purchase agreements, exploration agreements, area of mutual interest agreements, exchange and processing contracts and agreements, partnership and joint venture agreements and any other contracts, agreements and instruments, other than the Development Agreement (except as and to the extent described in Section 5.14), in each case, to the extent the above agreements cover, are attributable to or relate to the Lands or the Wells or any interests pooled, communitized or unitized therewith or any of the Other Assets or Transferred Gathering Systems, including, without limitation, those contracts and agreements described on Exhibit C (“Contracts”); (e) all Hydrocarbons in, on, under or produced from or attributable to the Lands from and after the Effective Time and the proceeds thereof; (f) all rights and privileges with respect to the use of the surface, including rights of ingress and egress, and subsurface depths under the lands covered by or subject to any of the Real Property Interests, or otherwise arising under or derived from the Properties or any of the Transferred Gathering Systems, in each case, to the extent related to the ownership and operation of, or which may be necessary for the use, development or operation of, the Properties or any of the Transferred Gathering Systems, including, but not limited to, all easements, subsurface easements, surface leases, servitudes and rights of way used or held for use in connection with the production of Hydrocarbons from the Lands (“Easements”); (g) all rights, benefits and obligations arising from or in connection with any Gas Imbalances as of the Effective Time; (h) all licenses, orders, franchises, registrations, permits, consents, approvals, variances, exemptions, waivers, rights, water rights (including water withdrawal, storage, discharge, treatment, injection and disposal rights related to the Properties) and other authorizations of all Governmental Authorities that are required to permit its operation of the Properties as presently operated by the Seller (the “Permits”), but only to the extent such Permits are transferrable; (i) the Other Assets (except for the Geological and Geophysical Information described on the attached Exhibit A-1) and the Transferred Gathering Systems; (j) licenses (the “G&G Licenses”) granted by the Seller to the Buyer (in forms reasonably acceptable to both Parties) covering the Geological and Geophysical Information described on the attached Exhibit A-1; and (k) the Seller’s Records.

“Purchase Price” has the meaning specified in Section 2.

“Real Property Interests” has the meaning specified in the definition of Properties.

“Records” means the Seller’s files, records and data (including electronic data) to the extent specifically related to the Properties, including but not limited to lease files, land files, well files, raw data (including core data, logs, fluid/gas data, water sample data, production data and pressure data), if any, division order files, ownership decks, abstracts, title files, engineering and/or production files, regulatory files, environmental files, maps and accounting and Tax records; provided, however, “Records” does not include (a) any of the Excluded Assets

and (b) any files, records and data which the Seller or its Affiliates are prohibited, by agreement, from sharing with a third party, provided that the Seller shall make commercially reasonable efforts (at no cost to the Seller) to obtain waivers of any such prohibitions.

“Required Consent” means a consent by a Third Party that, if not obtained prior to the assignment of a Real Property Interest, Well or Easement, either (a) automatically voids or nullifies the applicable Assignment with respect to such Property or (b) automatically terminates, or permits a lessor to terminate (legally and pursuant to the express terms of the underlying lease), the Seller’s interest in the Property subject to such consent; provided, however, “Required Consent” does not include any consent which by its terms cannot be unreasonably withheld or any Customary Post-Closing Consent.

“Respondent” has the meaning specified in Section 13.2.

“Retained Liabilities” means those liabilities and obligations of the Seller arising from the following: (a) all losses, claims, liabilities, demands, costs and expenses arising out of or in connection with the Seller’s failure to pay or incorrect payment of any ad valorem, severance or similar taxes allocable to the Properties with respect to periods prior to the Effective Time (specifically excluding any Assumed Obligations and any sales or transfer taxes arising from the transactions contemplated hereunder to occur at the Closing, which are to be treated in accordance with Section 8.5); (b) all claims, demands, violations, actions, damages, assessments, penalties, fines, costs, expenses, obligations, or other liabilities with respect to the ownership, operation or maintenance of the Properties prior to the Effective Time, insofar as the claims (or portions thereof) are attributable or allocable to the interest in the Properties, but excluding the obligations specifically assumed by the Buyer under the definition of Assumed Obligations; (c) all claims, demands, violations, actions, damages, assessments, penalties, fines, costs, expenses, obligations or other liabilities with respect to the Excluded Assets whether attributable to periods before or after the Effective Time (excluding the DA Assumed Obligations, if applicable pursuant to the terms of Section 5.14); and (d) the obligations of the Seller under the Consent Decree Agreement and the Consent Decree described in the definition of Consent Decree Agreement.

“Seller Indemnified Parties” has the meaning specified in Section 10.3.

“Special Damages” has the meaning specified in Section 14.16.

“SUSA” means Statoil USA Onshore Properties Inc., a Delaware corporation.

“Suspended Funds” means funds which the Seller is holding as of the Closing Date which are owing to Third Party owners of royalty, overriding royalty, working or other interests in respect of past production of oil, gas or other

Hydrocarbons attributable to the Seller’s Properties; provided that the “Suspended Funds” shall not include the Unleased Revenue.

“Taxes” means taxes of any kind, levies, or other like assessments, customs, duties, imposts, charges or fees of any Governmental Authority, including gross receipts, ad valorem, value added, excise, real or personal property, asset, sales, use, royalty, license, payroll, transaction, capital, net worth and franchise taxes, withholding, employment, social security, workers compensation, utility, severance, production, unemployment compensation, occupation, premium, windfall profits, transfer and gains taxes or other governmental taxes imposed or payable to the United States or any other Governmental Authority, and in each instance such term shall include any interest, penalties or additions to tax attributable to any such Tax, including penalties for the failure to file any tax return or report.

“Third Party” means any Person other than a Party or an Affiliate of a Party.

“Title Benefit” has the meaning specified in Section 2.1.9.

“Title Defect” means, as to (i) any Real Property Interest, any condition that causes the Seller’s title to the Marcellus Formation of such Property, and, if within the Utica Area, the Utica Formation of such Property, to be less than Defensible Title as of the Closing Date; and (ii) any Well, any condition that causes the Seller’s title to the Producing Formation of such Well, to be less than Defensible Title as of the Closing Date. For the avoidance of doubt, a single matter (such as an individual mortgage or lien) shall be treated as a single Title Defect even if affecting more than one Property. Notwithstanding the foregoing, the following shall not be considered Title Defects:

(a)    defects based solely on lack of information in the Seller’s files;

(b)    defects arising out of lack of corporate or other entity authorization unless the Buyer provides affirmative written evidence that the action was not authorized and results in another party’s superior claim of title;

(c)    defects based on failure to record leases issued by any federal governmental body, or any assignments of such leases, in the real property, conveyance or other records of the county in which the Property is located;

(d)    defects arising out of a lack of a survey, unless a survey is expressly required by applicable laws;

(e)    defects in the chain of title consisting of the failure to recite marital status in a document or omissions of successions of heirship or estate proceedings, unless the Buyer provides affirmative evidence that such failure or omission has resulted in another party’s superior claim of title;

(f)    defects that have been cured by the passage of time, the doctrine of adverse possession, applicable laws of limitation or prescription or such other matter that would render such defect invalid according to applicable law;

(g)    defects based solely on a legal description that includes the lessor’s mineral estate but describes a tract of land larger than that owned by the lessor;

(h)    defects that are a result of an assignment of interests in a Property from the Seller to another joint working interest owner that has been delivered and recorded or that has yet to be delivered and/or recorded to the extent such assignments do not, individually or in the aggregate, reduce the Seller’s Net Revenue Interest or increase the Seller’s Working Interest (without at least a proportionate corresponding increase in the Seller’s Net Revenue Interest) in any Well or Real Property Interest or reduce the Seller’s Net Acres with respect to any Real Property Interest from that shown for the Seller on Exhibit A;

(i)    defects relative to (i) Real Property Interests, to the extent affecting intervals, formations, strata and depths outside of the Marcellus Formation, or, if within the Utica Area, the Utica Formation, in such Real Property Interests, and (ii) Wells, to the extent affecting intervals, formations, strata and depths outside of the Producing Formation in the wellbore only of such Wells, and defects affecting any other geologic zone or depth specifically excluded from Sellers ownership as further described under the heading entitled Depth Limitations on the attached Exhibit A;

(j)    expiration of, or other defects affecting, Real Property Interests that are described on Exhibit A as having an expiration date on or prior to the Closing Date;

(k)    defects based on a gap in the chain of title, unless such gap is affirmatively shown to exist in such records by an abstract of title, title opinion or landman’s title chain or runsheet, which documentation shall be provided by Buyer to Seller in the Defect Notice;

(l)    defects based on the fact that a Third Party owns or controls the coal underlying the lands underlying any of the Properties;

(m)    defects as a consequence of cessation of production, insufficient production or failure to conduct operations on any of the Properties held by production, or on the Lands, except to the extent that such cessation of production, insufficient production or failure to conduct operations (taking into account any cessation of production that is permitted under the terms of the applicable lease) (i) is affirmatively proven by the Buyer to have occurred after September 30, 2004, and (ii) caused the affected Real

Property Interest to expire or gives rise to a right to terminate the Real Property Interest in question, which evidence shall be included in the Defect Notice; and

(n)    an unsubordinated mortgage that is not in default.

“Transaction Documents” means this Agreement, the Assignments and the documents and instruments to be delivered at Closing.

“Transferred Gathering Systems” means the Gathering Systems described on Exhibit A-2.

“Unleased A/R” has the meaning specified in Section 2.10.

“Unleased Accounts” has the meaning specified in Section 2.10.

“Unleased Revenue” has the meaning specified in Section 2.10.

“Utica Area” means that subpart of the Contract Area designated as the “Utica Area” on the map attached hereto as Schedule 1.2.

“Utica Formation” means the geological formations that are known as the Utica Shale formations, which generally include the stratigraphic equivalent of the formations found in the James Messenger ETZ 3H U well (API#4710302973) located in Wetzel County, West Virginia, with the top (being the top of the Point Pleasant formation) at the correlative stratigraphic equivalent to that point found at a measured depth of 12,282 feet on the Log and the base (being the top of the Trenton formation) at the correlative stratigraphic equivalent to that point found at a measured depth of 12,395 feet on the Log, recognizing that the actual depth will vary across the Lands.

“Wells” has the meaning specified in the definition of Properties.

“Working Interest” (or “WI”) means, with respect to the Wells, the decimal interest in the full and entire leasehold estate in any Property and all rights and obligations of every kind and character pertinent thereto or arising therefrom, without regard to any valid lessor royalties, overriding royalties and/or other burdens against production, insofar as said interest in said leasehold is burdened with the obligation to bear and pay the cost of exploration, development and operation.

words “this Agreement,” “herein,” “hereby,” “hereunder” and “hereof,” and words of similar import, refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The words “this Section” and “this subsection,” and words of similar import, refer only to the Section or subsection hereof in which such words occur. A defined term has its defined meaning throughout this Agreement regardless of whether it appears before or after the place where it is defined. The word “or” is disjunctive but not necessarily exclusive, and has the inclusive meaning represented by the phrase “and/or” and the word “including” (in its various forms) means including without limitation. Examples are not to be construed to limit, expressly or by implication, the matter they illustrate. Each accounting term not defined herein, and each accounting term partly defined herein to the extent not defined, will have the meaning given to it under GAAP. All references to prices, values or monetary amounts refer to Dollars. Pronouns in masculine, feminine or neuter genders shall be construed to state and include any other gender, and words, terms and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. Exhibits and Schedules referred to herein are attached to and by this reference incorporated herein for all purposes.

2.    Purchase and Sale; Purchase Price. At the Closing, and upon the terms and subject to the conditions of this Agreement, the Seller agrees to sell and convey to the Buyer all of its Properties, and the Buyer agrees to purchase, accept and pay for the Properties and to assume all of the Assumed Obligations. In consideration for the sale of the Properties, the Buyer will pay to the Seller the purchase price of FIVE BILLION THREE HUNDRED SEVENTY-FIVE MILLION DOLLARS ($5,375,000,000.00) (the “Purchase Price”, subject to adjustments as provided in this Agreement) in immediately available funds at Closing (pursuant to wire transfer instructions designated in advance by the Seller to the Buyer in writing). Within two (2) Business Days after the Execution Date, the Buyer will pay to the Seller an earnest money deposit equal to five percent (5%) of the unadjusted Purchase Price (the “Deposit”). At Closing, the Deposit will be applied against the Purchase Price payable to the Seller in accordance with the provisions of this Agreement. The Purchase Price will be adjusted (without duplication) as set forth below in this Section 2.

Environmental Defect (“Defect Notice”). The term “Defect Notice Date” means (i) 5:00 p.m. Central Time on the one hundred twentieth (120^th) day following the Closing Date in the case of Title Defects and (ii) 5:00 p.m. Central Time on the fifth (5^th) Business Day prior to the Closing Date in the case of Environmental Defects. Any matters that may otherwise constitute Title Defects or Environmental Defects, but of which the Seller has not been notified by the Buyer in writing by the respective Defect Notice Date, shall be deemed to have been waived by the Buyer for all purposes; provided, however, that no failure to provide any such notice by the respective Defect Notice Date shall be deemed a waiver of any right or remedy under the Assignment with respect to any breach of the special warranty of title to be given by the Seller in the Assignment. All adjustments to the Purchase Price based on Title Defects will be based on the Allocated Values attributable to the affected Properties. Upon timely delivery of a Defect Notice under this Section 2.1, the Buyer and the Seller will in good faith negotiate the validity of the claim and the amount of any adjustment to the Purchase Price using the following criteria:

547 days and the number of days within the period beginning on the Effective Time and ending on the actual expiration date of the Real Property Interest as set forth in the applicable lease, minus (ii) the number of days within the period beginning on the Effective Time and ending on the expiration date of the Real Property Interest as set forth on Exhibit A, and (b) the denominator of which is the number of days within the period beginning on the Effective Time and ending on the expiration date of the Real Property Interest as set forth on Exhibit A; provided, however, no adjustment based on a Late Lease Expiration shall exceed an amount equal to the Allocated Value shown for the respective Real Property Interest on Exhibit A.

connection with the Seller’s efforts to cure alleged defects. The Seller will be deemed to have adequately completed the cure of an Environmental Defect after the implementation and completion of any remedial, removal, response, construction, closure, disposal or other corrective actions required under Environmental Laws to correct or remove such Environmental Defect.

together with a copy of this Agreement and any supporting material that such Party desires to furnish, not later than the fifth (5th) Business Day after appointment of the Consultant(s). In making their determination, the Consultant(s) shall be bound by the terms of this Agreement and, without any additional or supplemental submittals by either Party, may consider available legal and industry matters as in their opinion are necessary or appropriate to make a proper determination. By the twentieth (20th) day following the submission of the matter to the Consultant(s), applying the principles set forth in this Section 2.1, the Consultant(s) shall make a determination of the matter submitted. The decision of the Consultant(s) shall be in writing and conclusive and binding on the Seller and the Buyer and shall be enforceable against the Parties in any court of competent jurisdiction. The Consultant(s) shall act as experts for the limited purpose of determining the specific title or environmental dispute presented to them, shall not act as arbitrators, may not hear or decide any matters except the specific title or environmental disputes presented to them and may not award damages, interest, costs or penalties to either Party.

that all such waivers and consents are promptly granted, and after Closing, the Buyer will reasonably assist the Seller in obtaining any remaining waivers and consents.

receipt of such notice, the Seller shall assign and convey to the Buyer and the Buyer shall accept from the Seller such Properties pursuant to the terms of this Agreement. As between the Buyer and the Seller, with respect to any Property for which a Required Consent has not been obtained by the Closing, (a) the Seller shall hold such Property as nominee for the Buyer, effective as of the Effective Time, (b) the Buyer shall pay any costs and expenses associated with that Property, and (c) the Seller shall pay the Buyer any revenues received by the Seller that are associated with such Property for time periods from and after the Effective Time. If any Required Consent has not been received or deemed received on or before the one (1) year anniversary of the Closing Date, then the Seller shall no longer hold such Property as nominee for the Buyer, and each Party shall repay to the other Party any amounts previously paid hereunder in respect of the Property, and such Property will be deemed not to have been conveyed to the Buyer hereunder and shall be an Excluded Asset. From the Closing until the date of conveyance (or until the one year anniversary, if not to be conveyed pursuant to this Section 2.2.2 due to expiration of such period), with respect to those Properties not conveyed at Closing solely pursuant to Section 2.2.1 and which Seller continues thereafter to operate, Seller will continue to conduct its operations with respect to such Properties consistent with the provisions of Section 5.2, subject to the caveats and liability limitations contained therein.

the Effective Time, less taxes and gravity adjustments deducted by the purchaser of such oil or other liquid Hydrocarbons; (b) the amount of all expenditures incurred and paid by or on behalf of the Seller in connection with the ownership, operation and maintenance of the Properties (including rentals, overhead, royalties, prepayments, operating, drilling and completion costs and other charges and expenses billed under applicable operating agreements) attributable to the period on or after the Effective Time, excluding any such amounts to cure or remediate any Title Defect or Environmental Defect; (c) all expenses of the type referenced in (b) paid by or on behalf of the Seller in connection with unleased interests and incurred subsequent to the Effective Time; (d) the amount of any proceeds from the sale of Hydrocarbons produced prior to the Effective Time from the Properties that are received by Buyer on behalf of the unleased interests; and (e) any other amount agreed upon by the Buyer and the Seller, or otherwise required to be reflected pursuant to the other provisions of this Section 2.

Purchase Price required under this Agreement (except as otherwise set forth in Section 2.1.12) and showing the calculation of such adjustments. The Closing Statement will be used to adjust the Purchase Price at Closing. Any final adjustments, if necessary, will be made pursuant to Section 2.8 of this Agreement.

Final Statement, or upon resolution of such adjustments by the Accounting Referee, as the case may be, the Final Statement (as adjusted pursuant to such agreement or resolution by the Accounting Referee) will be deemed final and binding on all of the Parties and the aggregate amount due to either the Buyer or the Seller pursuant to such Final Statement will be paid in accordance with Section 2.9. If any Properties are assigned to Buyer after Closing or re-assigned to Seller in each case pursuant to Section 2.1.2 or 2.2.2, any such finally determined adjustments with respect to the Properties so assigned or re-assigned will be reflected in the amounts paid by Buyer in the event of such an assignment or refunded/unwound in the event of such a re-assignment.

  

3.    Seller’s Representations and Warranties. The Seller represents and warrants to the Buyer, as of the date of this Agreement, as follows:

its interest in the Properties or give rise to any right of early termination, cancellation or acceleration under any of the terms, conditions or provisions of any Real Property Interests, Contracts, note, bond, mortgage or indenture to which the Seller is a party or by which the Seller or its Properties may be bound; except where the conflict, violation, breach, default, creation, imposition, continuation or arisen right would not constitute a Material Adverse Effect.

Material Contract and, to the Seller’s Knowledge, has not received written notice of its being in breach of or default under any Material Contract. All Material Contracts to which the Seller is a party are valid and binding upon the Seller and, to the Seller’s Knowledge, each Material Contract is in full force and effect and enforceable against the other parties thereto. To the Seller’s Knowledge, no other party to any such Material Contract is in material default thereunder. To the Seller’s Knowledge, no currently effective notices have been received by the Seller of the exercise of any premature termination, price redetermination, market-out or curtailment under any Material Contract.

valid and binding with respect to the Seller and enforceable in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors’ rights generally.

proceeds from the sale thereof, attributable to the Properties at some future time without receiving payment therefor at or after the time of delivery.

4.    Buyer’s Representations and Warranties. The Buyer represents and warrants to the Seller, as of the date of this Agreement, as follows:

accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors’ rights generally.

representation or warranty, expressed or implied, as to the accuracy or completeness of any information regarding the Properties except as expressly set forth in the Transaction Documents, and the Seller shall have no liability to the Buyer or any of the Buyer’s successors or assigns for its reliance on any information regarding the Seller or the Properties that is not contained in the Transaction Documents. The Buyer is acquiring the Properties for its own account and not with the intent to make any distribution of undivided interests thereof which would violate any applicable Laws.

5.    Covenants. The Parties hereby covenant and agree to perform the following:

the ASTM E1903 – 11 should be conducted and if Buyer timely requests the consent of Seller to such a Phase II assessment but Seller’s consent is denied (or deemed denied as provided above), then Buyer may exclude the affected Property from the Transaction Documents, in which case the Purchase Price shall be reduced by an amount equal to the Allocated Value of the affected Property and that Property shall thereafter constitute an Excluded Asset.

Insofar as related to the Properties, the Seller will give to the Buyer and its agents and representatives, reasonable access to all of the Records and the Seller will cause its officers and employees to furnish to the Buyer and its agents and representatives such operating data and other information with respect to the Properties as the Buyer may, from time to time, reasonably request; provided, however, (a) any such investigation will be conducted in such manner as not to interfere unreasonably with the operation of the business of the Seller, and (b) the Seller shall not be required to provide any of the foregoing information to the extent that the Seller is prohibited by any Third Party agreement from sharing such information with the Buyer (provided that the Seller shall use commercially reasonable efforts (at no cost to the Seller) to obtain the consent of such Third Parties to the sharing of such information). Buyer acknowledges that, pursuant to its right of access to the Records, Buyer will become privy to confidential and other information of the Seller and that such confidential information shall not be used for any purpose other than assessing the transactions contemplated by this Agreement and shall be held confidential by Buyer in accordance with the terms of the Confidentiality Agreement. If the Closing should occur, the foregoing confidentiality restriction on Buyer, including those contained in the Confidentiality Agreement to the extent related to the Records, shall terminate (except as to (a) any Properties that are excluded from the transactions contemplated hereby pursuant to the provisions of this Agreement, (b) the Excluded Assets and (c) information related to any assets other than the Properties, which confidentiality obligations shall terminate in accordance with the Confidentiality Agreement).

The Buyer acknowledges that the Seller owns an undivided interest in certain of the Properties with respect to which the Seller is not the operator, and Buyer agrees that the acts or omissions of the other Working Interest owners (including the operators) who are not the Seller or an Affiliate of the Seller shall not constitute a breach of the provisions of this Section 5.2, nor shall any action required by a vote of Working Interest owners constitute such a breach so long as the Seller, in either case, has voted its interest in a manner that complies with the provisions of this Section 5.2.

Without expanding any obligations which Seller may have to Buyer, it is expressly agreed that Seller shall never have any liability to Buyer with respect to any breach or failure of Section 5.2 greater than that which it might have as the operator to a non-operator under the applicable operating agreement (or, in the absence of such an agreement, under the AAPL 610 (1989 Revision) form Operating Agreement), IT BEING RECOGNIZED THAT, UNDER SUCH AGREEMENTS AND SUCH FORM, THE OPERATOR IS NOT RESPONSIBLE FOR ITS OWN NEGLIGENCE, AND HAS NO RESPONSIBILITY OTHER THAN FOR GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

periods prior to the Effective Time or (b) the Seller receives production or other revenues attributable to any of the Properties for any periods after the Effective Time, the receiving Party will hold such revenues for the exclusive benefit of the Party entitled thereto and, if not taken into account for purposes of the Final Statement, shall promptly deliver such funds to the appropriate Party.

termination of the waiting period thereunder. The Buyer and the Seller agree to respond promptly to any inquiries from the DOJ or the FTC concerning such filings and to comply in all material respects with the filing requirements of the HSR Act. The Buyer and the Seller shall cooperate with each other and, subject to the terms of the Confidentiality Agreement, shall promptly furnish all information to the other Party that is necessary in connection with the Buyer’s and the Seller’s compliance with the HSR Act. The Buyer and the Seller shall keep each other fully advised with respect to any requests from or communications with the DOJ or FTC concerning such filings and shall consult with each other with respect to all responses thereto. Each of the Seller and the Buyer shall use its reasonable efforts to take all actions reasonably necessary and appropriate in connection with any HSR Act filing to consummate the transactions consummated hereby. All filing fees incurred in connection with the filings made pursuant to this Section 5.6 shall be borne by the Buyer.

acceptable to both the Seller and the Buyer in each Party’s sole discretion, prior to Closing, the Buyer will enter into and the Seller will cause CEMI to enter into: (a) a capacity use agreement with Enterprise, wherein the Buyer, as agent for CEMI, transports the Buyer ATEX Volume under the ATEX Agreement and delivers such Buyer ATEX Volume at the delivery points under the ATEX Agreement for sale or marketing by the Buyer; and (b) an agreement detailing CEMI’s and the Buyer’s obligations to each other under the capacity use agreement, including, without limitation, the Buyer’s obligations to reimburse costs and expenses under the ATEX Agreement that are attributable to the Buyer ATEX Volume to CEMI. If Enterprise does not agree to enter into a capacity use agreement with the Buyer and CEMI, then the Buyer will enter into, and Seller will cause CEMI to enter into, a buy-sell agreement, whereby CEMI will purchase the Buyer ATEX Volume at the inlet to the ATEX pipeline and redeliver to the Buyer the Buyer ATEX Volume at any delivery point available (without additional cost and with the Buyer responsible for all ATEX Agreement charges attributable to the Buyer ATEX Volume) to CEMI per the Buyer’s instructions. CEMI will not be responsible for any incremental storage, transfer, or other handling fees the Buyer may be subject to under the buy-sell agreement. Notwithstanding anything to the contrary in this Agreement, if the Buyer is unable to take assignment of the Ethane Purchase Agreement between CEMI and Westlake Petrochemicals LLC dated January 17, 2012 (the “Westlake Agreement”), then the Buyer will sell to CEMI (or CEMI will not sell back to the Buyer if a buy-sell agreement is in effect) the volumes necessary to fulfill the Buyer’s share of the obligations retained by CEMI under the Westlake Agreement at the price in effect under the Westlake Agreement net of midstream fees and deductions.

fails to furnish to the Seller at or prior to Closing the Applicable Consent with respect to any Midstream Consent Contract, then, in any such event, such Midstream Consent Contract will not be assigned and, if the applicable Midstream Consent Contract is a gas sales contract, processing contract or similar contract for the sales of hydrocarbons, the Buyer will sell all hydrocarbons currently flowing under such Midstream Consent Contract to CEMI at the receipt points under such Midstream Consent Contract for a price equal to 100% of CEMI’s sale price of such hydrocarbons less the Applicable Deductions (as hereinafter defined), and if the applicable Midstream Consent Contract is a gathering contract, field services contract or other contract for the provision of gathering, transportation, compression or treating services for a fee or rate, CEMI will schedule, nominate and purchase all volumes delivered by Buyer in accordance with such Midstream Consent Contract at the inlet to the applicable system and redeliver to the Buyer the volume or quantity to which CEMI is entitled under the applicable Midstream Consent Contract at any delivery point available (less Applicable Deductions) to CEMI per the Buyer’s instructions, until the earlier of: (i) the termination of such Midstream Consent Contract; (ii) the expiration of the term of such Midstream Consent Contract; or (iii) the counterparties’ consent to the assignment to the Buyer and the release of the Seller and/or CEMI, as applicable, under such Midstream Consent Contract. As used herein, “Applicable Deductions” means (x) during the period from the Closing Date through the end of the second month after the month the Closing occurs, reimbursement to CEMI for all fees and deductions charged to or paid by CEMI in connection therewith (the “Initial Period”); and (y) commencing on the first day of the month following the end of the Initial Period, an amount equal to one and one-half percent (1½ %) of the sales price of such Hydrocarbons plus all midstream fees and deductions charged to or paid by CEMI in connection therewith.

case, from and after the Effective Time and solely to extent pertaining to the Properties. 

Affiliates to, cooperate with arranging for each counterparty under the FERC Jurisdictional Contracts to post the Seller’s and its Affiliates’ pre-arranged permanent capacity release to the Buyer or its designee of their interests in the FERC Jurisdictional Contracts, and if the release of such FERC Jurisdictional Contracts is not at the maximum recourse rate, the Buyer or its designee will have the right to match any higher bid pursuant to the tariffs of the interstate pipelines providing transportation service pursuant to the FERC Jurisdictional Contracts. If the rate for any FERC Jurisdictional Contract is a negotiated rate, then the Buyer and the Seller shall cooperate to seek any waivers necessary to enable the Seller or its Affiliates to release that FERC Jurisdictional Contract at a rate that results in the permanent release of the Seller or its Affiliate, without further payment obligations to the relevant pipeline. If Seller releases capacity to Buyer without FERC Waivers pursuant to this Section 5.11.3, Seller agrees to exercise any rights of first refusal or extension options under the FERC Jurisdictional Contract(s) involved at Buyer’s direction, cost and expense. After the date that is six (6) months after Closing, the Seller may take the action described above without first obtaining the Buyer’s request or consent.

assignment, cease to be subject to the Development Agreement in all respects and cease to be “Joint Interests” under the Development Agreement, then promptly thereafter Seller will deliver a copy of the Development Agreement to Buyer and Buyer agrees to keep the Development Agreement strictly confidential pursuant to the terms of the Confidentiality Agreement. Within five (5) Business Days after Buyer’s receipt of a copy of the Development Agreement, Buyer will notify Seller in writing as to whether Buyer is willing to assume and accept at Closing all of Seller’s rights, duties and obligations under the Development Agreement to the extent such rights, duties and obligations relate to the Properties conveyed to Buyer pursuant to this Agreement or to the lands located in the Contract Area (as so limited, the “DA Assumed Obligations”). If Buyer notifies Seller that Buyer is willing to assume and accept at Closing the DA Assumed Obligations, then (a) the conditions set forth in Sections 6.4(c) and 7.5(c) will be satisfied and (b) Buyer will assume and be assigned, and Seller will be fully released from, the DA Assumed Obligations pursuant to an assignment and assumption agreement to be executed and delivered by the Parties at Closing in form and substance sufficient to accomplish (and that satisfies the requirements of the Development Agreement with respect to) such assignment, assumption and release.

6.    Buyer’s Conditions Precedent. The obligation of the Buyer to consummate the transactions contemplated by this Agreement is, at the option of Buyer, subject to the satisfaction or waiver in writing by the Buyer (subject to applicable Laws) on or prior to the Closing Date of each of the following conditions precedent:

7.    Seller’s Conditions Precedent. The obligation of the Seller to consummate the transactions contemplated by this Agreement is, at the option of the Seller, subject to the satisfaction or waiver in writing by the Seller (subject to applicable Laws) on or prior to the Closing Date of each of the following conditions precedent:

8.    The Closing. Subject to the terms and conditions hereof, unless extended as provided herein, the Closing will take place at 10:00 a.m. local time in the offices of the Seller, at 6100 North Western Avenue, Oklahoma City, Oklahoma 73118 on the Closing Date.

Gathering Systems for each County in which any of the Other Assets or Transferred Gathering Systems are located, executed by an authorized officer of the Seller or its Affiliate which owns such Other Assets or Transferred Gathering Systems;

9.    Press Releases. No Party shall make any press release or other public announcements concerning this transaction, without the consent of the other Party, which consent shall not be unreasonably withheld. Any Party desiring to make a public announcement shall first give the other Party twenty-four (24) hours written notification of its desire to make such a public announcement. The written notification shall include (a) a request for consent to make the announcement, and (b) a written draft of the text of such public announcement. Nothing contained herein shall prohibit any Party from issuing or making a public announcement or statement if such Party deems it necessary to do so in order to comply with any applicable Law, or the rules of any stock exchange upon which the Party’s capital stock is traded, provided that such Party provides the other Party with a written draft of the text of such public announcement prior to issuing or making such public announcement.

10.    Indemnification. Upon and after the Closing of the transactions contemplated by this Agreement, the Parties will indemnify each other as follows:

“Buyer Indemnified Parties”) for, from and against any loss, damage, diminution in value, claim, liability, debt, obligation or expense (including interest, reasonable legal fees, and expenses of litigation and attorneys’ fees in enforcing this indemnity) incurred, suffered, paid by or resulting to any of the Buyer Indemnified Parties and which results from, arises out of or in connection with, is based upon, or exists by reason of: (a) the breach of any representation or warranty of the Seller set forth in this Agreement (as brought down by the Seller’s certificate delivered at Closing) or any failure by the Seller to perform any of its covenants or obligations set forth in this Agreement (other than any covenant contained in Section 5.2) which is not cured as provided in Section 12 of this Agreement; (b) any failure by the Seller to perform any of its covenants or obligations set forth in Sections 5.2 of this Agreement which is not cured as provided in Section 12 of this Agreement; or (c) any of the Retained Liabilities.

INDEMNIFICATION SHALL BE APPLICABLE TO THE EXTENT OF ANY GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE INDEMNIFIED PERSON. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, THE INDEMNIFICATION SET FORTH IN SECTIONS 10.2 AND 10.3 (AS LIMITED IN THIS AGREEMENT) SHALL CONSTITUTE THE SOLE AND EXCLUSIVE POST-CLOSING REMEDIES OF THE PARTIES AGAINST EACH OTHER WITH RESPECT TO BREACHES OF ANY REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT CONTAINED IN SECTION 3, 4, OR 5.2 (AND AS THE FOREGOING REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS ARE AFFIRMED IN THE CERTIFICATES DELIVERED AT CLOSING). FOR THE AVOIDANCE OF DOUBT, EACH PARTY SHALL HAVE ALL RIGHTS AND REMEDIES AVAILABLE AT LAW OR IN EQUITY FOR THE BREACH OF ANY OTHER COVENANT OR AGREEMENT CONTAINED IN THIS AGREEMENT (EXCLUDING THE REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS CONTAINED IN SECTIONS 3, 4, AND 5.2).

expenses of such defense to be paid by the indemnifying Party. As a condition to the indemnifying Party’s obligations hereunder, the indemnified party will in good faith cooperate with and assist the indemnifying Party in the prosecution or defense of such indemnified claim at no unreasonable expense to the indemnified party. No indemnifying Party shall consent to entry of any judgment or enter into any settlement with respect to a claim either (a) without the consent of the indemnified party, which consent shall not be unreasonably withheld, or (b) unless such judgment or settlement includes as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability with respect to such claim. No indemnified party shall consent to entry of any judgment or enter into any settlement of any such action, the defense of which has been assumed by an indemnifying Party, without the consent of such indemnifying Party, which consent shall not be unreasonably withheld.

policies carried by the Party otherwise entitled to such indemnification or its Affiliates, in each case, that are actually realized by such Party.

11.    Termination. The Parties agree that this Agreement is subject to termination as follows:

if the Closing shall not have occurred on or before March 15, 2015, provided that such failure does not result primarily from the terminating Party’s material breach of its representations, warranties or covenants contained in this Agreement; or (e) by either the Seller or the Buyer, if under the HSR Act or otherwise, the FTC or the DOJ shall have commenced or threatened to commence any proceeding to delay or enjoin or seek damages in respect of the transactions evidenced by this Agreement (“threatened,” for purposes of this Section 11.1(e), means an actual vote of the Commissioners of the Federal Trade Commission to commence such a proceeding).

12.    Default. If any Party fails to perform any material obligation contained in this Agreement that is to be performed at or prior to Closing, and Closing has not yet occurred, the Party claiming default will serve written notice to the other Party specifying the nature of such default and demanding performance. If such a material default by the Seller has not been cured within the sooner of ten (10) days after receipt of such default notice or the date specified in Section 11.1(d) above, and each of the conditions contained in Section 7 has been either fulfilled in all material respects or waived in writing (other than conditions pertaining to the execution and delivery of documents and payment of monies by the Buyer the fulfillment of which is expressly provided to occur at the Closing), then the Buyer will be entitled to exercise all remedies arising at law or in equity by reason of such default, including termination of this Agreement pursuant to Section 11. If such a material default by the Buyer has not been cured within the sooner of ten (10) days after receipt of such default notice or the date specified in Section 11.1(d) above, and each of the conditions contained in Section 6 has been either fulfilled in all material respects or waived in writing (other than conditions pertaining to the execution and delivery of documents the fulfillment of which is expressly provided to occur at the Closing), then the Seller will be entitled to retain the Deposit as liquidated damages in lieu of all other damages (and as the Seller’s sole remedy in such event, other than termination of this Agreement). The Parties hereby acknowledge that the extent of damages to the Seller occasioned by such failure or refusal by the Buyer would be impossible or extremely impractical to ascertain and that the amount of the Deposit is a fair and reasonable estimate of such damages under the circumstances.

13.    Arbitration. Except with respect to disputes and matters required to be resolved by the Consultant(s) or the Accounting Referee, which will be resolved as provided in Sections 2.1.11 or 2.8, any and all Arbitrable Disputes must be resolved through the use of binding arbitration in accordance with the Commercial Arbitration Rules of the AAA, as supplemented to

the extent necessary to determine any procedural appeal questions by the Federal Arbitration Act (Title 9 of the United States Code). If there is any inconsistency between this Section 13 and the Commercial Arbitration Rules or the Federal Arbitration Act, the terms of this Section 13 shall control the rights and obligations of the Parties.

shall determine the Arbitrable Disputes and render a final award on or before thirty (30) days following the completion of the hearing. The arbitrators’ decision shall be in writing and set forth the reasons for the award. In rendering the award the arbitrators shall abide by (a) the terms and conditions of this Agreement including, without limitation, any and all restrictions, prohibitions or limitations on damages or remedies set forth in this Agreement and (b) the law of the State of Texas. The arbitrators shall not have jurisdiction or authority to add to, detract from or alter in any way the provisions of this Agreement.

14.    Miscellaneous. It is further agreed as follows:

delivery service), the date shown on the notice of delivery. Addresses for all such notices and communication shall be as follows:

Either Party may, upon written notice to the other Party, change the address(es) and person(s) to whom such communications are to be directed.

3.10, 3.11, 4.1, 4.4 and 4.8 shall survive the Closing until the expiration of the applicable statute of limitations. Except as otherwise set forth in this Agreement, the remainder of this Agreement shall survive the Closing without time limit. The special warranty of title set forth in the Assignment will survive the Closing Date for a period of five (5) years and shall thereafter be of no further force or effect except that any claim under such special warranty of title which has been asserted prior to the end of such five (5) year period shall survive until such claim with respect thereto is resolved. The intended effect of termination of representations and warranties (and the indemnification rights with respect thereto) and the special warranty of title is to bar, from and after the date of termination, any claim or cause of action based on the alleged inaccuracy of such representation or breach of such warranty, or with regard to claims for indemnity with respect thereto or with respect to such special warranty of title.

kind property (an “Exchange”) under section 1031 of the Internal Revenue Code of 1986, as amended (the “Code”); provided, that the Closing shall not be delayed or affected by reason of the Exchange. Each Party agrees to use reasonable efforts to cooperate with the other Parties in the completion of such an Exchange including an Exchange subject to the procedures outlined in Section 1.1031(k)-1 of the United States Treasury Regulations promulgated under the Code (the “Treasury Regulations”) and/or Internal Revenue Service Revenue Procedure 2000-37. Each of the Parties shall have the right at any time prior to Closing to assign all or a portion of its rights under this Agreement to a qualified intermediary (as that term is defined in Treasury Regulation Section 1.1031(k)-1(g)(4)(iii)) or an exchange accommodation titleholder (as that term is defined in Internal Revenue Service Revenue Procedure 2000-37) to effect an Exchange. In connection with any such Exchange, any exchange accommodation title holder shall have taken all steps necessary to own the Properties under applicable Law. Each Party acknowledges and agrees that neither an assignment of a Party’s rights under this Agreement nor any other actions taken by a Party or any other person in connection with the Exchange shall release any Party from, or modify, any of their respective liabilities and obligations (including indemnity obligations to each other) under this Agreement, and no Party makes any representations as to any particular tax treatment that may be afforded to any other Party by reason of such assignment or any other actions taken in connection with the Exchange. Any Party electing to treat the acquisition or sale of the Properties as an Exchange shall be obligated to pay all additional costs incurred hereunder as a result of the Exchange, and in consideration for the cooperation of the other Parties, the Party electing Exchange treatment shall agree to pay all costs associated with the Exchange and to indemnify and hold the other Party, its affiliates and former, current and future partners, members, shareholders, owners, officers, directors, managers, employees, agents and representatives harmless from and against any and all liabilities and taxes arising out of, based upon, attributable to or resulting from the Exchange or transactions or actions taken in connection with the Exchange that would not have been incurred by the other Parties but for the electing Party’s Exchange election.

any of its Affiliates) with the Securities and Exchange Commission or other Governmental Authority (collectively, the “Financial Statements”).

IN WITNESS WHEREOF, the Seller has executed this Agreement on the Execution Date.

IN WITNESS WHEREOF, the Buyer has executed this Agreement on the Execution Date.