WHEREAS, Purchaser desires to purchase and Sellers desire to sell all of Sellers’ right, title and interest in and to certain oil, gas and mineral leases and associated assets and contract rights owned by Sellers; and

WHEREAS, Sellers and Purchaser desire to set forth herein the terms and provisions of their agreements and understandings.

NOW, THEREFORE, in consideration of the foregoing, of the mutual promises hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:

ARTICLE I
GENERAL TERMS AND CONDITIONS

1.01

Sale of Subject Properties.

1.01.01

Subject to the terms and conditions of this Agreement, Sellers covenant and agree to sell to Purchaser, and Purchaser covenants and agrees to buy from Sellers, all of Sellers’ or WDP’s right, title and interest in and to the properties more specifically described below (hereinafter the “Subject Properties”):

(A)

all of the wells described on Exhibit “A” or otherwise located on the Leases or the Lands (the “Wells”);

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(B)

the oil and gas leases described on Exhibit “B” (the “Leases”), it being the intent of the Parties that the term “Leases” shall include the entirety of the hydrocarbon leasehold interests and other hydrocarbon interests owned by Sellers as of the Effective Date in and to the Lands and the Wells described on Exhibit “A”;

(C)

all lands covered by the Leases and all other leasehold interests, mineral interests, fee and surface interests and royalty interests, including, without limitation, working interests, overriding royalty interests, reversionary interests, non-consent interests, and any other interests of a similar nature, owned by Sellers in such lands or lands pooled or unitized therewith (collectively, the “Lands”);

(D)

(i) all rights with respect to the use and occupancy of the surface of and the subsurface depths under the Lands; (ii) all rights with respect to any pooled, communitized or unitized acreage by virtue of any Lands being a part thereof; (iii) all real, immovable, personal and movable property located upon the Lands and used in connection with the exploration, development or operation of the Subject Properties;

(E)

all payments, and all rights to receive payments, with respect to the ownership of the production of hydrocarbons from, or the conduct of operations on, the Lands, Leases and/or Wells, accruing on or after the Effective Date;

(F)

all presently existing and valid oil, gas or mineral unitization, pooling, operating and communitization agreements, declarations, orders, rules, regulations or other official acts of any Governmental Authority and the units created thereby, including, without limitation, all units voluntarily formed or formed under orders, regulations, rules or other official acts of any Governmental Authority having jurisdiction, insofar and only insofar as they relate to the Leases, Lands and/or Wells;

(G)

all contracts, agreements and other similar instruments relating to the Subject Properties (including, without limitation, all easements, surface use agreements and rights-of-way (including, without limitation, Permits with respect to rights-of-way involving railroads and road crossings) used in connection with the exploration, development, operation or maintenance of the Subject Properties), excluding such contracts, agreements and other similar instruments relating to the Subject Properties which shall terminate at Closing (the “Contracts”);

(H)

all personal property, improvements, lease and well equipment, (including as applicable, but not limited to, any tanks, boilers, buildings, platforms, flowlines, fixtures, machinery, injection facilities, saltwater disposal facilities, compression facilities and other equipment, gathering systems, power lines, telephone and telegraph lines, roads and other appurtenances) owned by Sellers and located on the Leases, Lands and/or Wells or lands pooled or unitized with the Leases, which are being used primarily in connection with the

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exploration, development, operation or maintenance of the Subject Properties, or any unit or units in which part or parts of the Leases, Lands and/or Wells may be included, or are being used primarily in connection with the production, treating, storing, transportation or marketing of oil, gas and minerals, produced from or allocated to the Leases, Lands and/or Wells;

(I)

all of the original files, records, information and data primarily relating to the Subject Properties in the possession of any Seller or WDP (“Records”), including, without limitation, title records (including, without limitation, abstracts of title, title opinions, certificates of title and title curative documents), contracts, correspondence, geological data and information (including, without limitation, maps and interpretations thereof), production records, electric logs (including, without limitation, cross sections and correlations thereof), core data, pressure data, declined curves, graphical production curves, drilling reports, well completion reports, drill stem test charts and reports, engineering reports, regulatory reports, accounting and financial information (including, without limitation, invoices, receipts, records and files) as is nece ssary in connection with the ownership or operation of the Subject Properties and all related materials (in each case above, to the extent capable of being legally transferred by Sellers or WDP and, with respect to any LAS log files that require the payment of a fee or other penalty to transfer, only if Purchaser agrees to pay such fee or other penalty);

(J)

all franchises, licenses, permits, approvals, consents, certificates, authorizations and other rights granted by Governmental Authorities and all certificates of convenience or necessity, immunities, privileges, grants and other rights that relate to the Subject Properties or the ownership or operation of the Subject Properties (the “Permits”), to the extent the same are assignable; and

(K)

all causes of action and choses of action incident to any of the foregoing and to the extent attributable to the period from and after the Effective Date.

1.01.02

The Subject Properties shall not include any of Sellers’ right, title or interest in any of the following (referred to herein as the “Excluded Assets”):  (A) all trade credits and all accounts, instruments and general intangibles (as such terms are defined in the Uniform Commercial Code of Louisiana) attributable to the Subject Properties with respect to any period of time prior to the Effective Date; (B) all claims and causes of action of Sellers (i) arising from acts, omissions or events, or damage to or destruction of property, occurring prior to the Effective Date, (ii) arising under or with respect to any contracts, agreements or other similar instruments relating to the Subject Properties that are attributable to any period of time prior to the Effective Date (including, without limitation, claims for adjustments or refunds), or (iii) with respect to any of the Excluded Assets (subject to Section 11.16); (C) all rights and interests of Sellers (i) under any policy or agreement of insurance or indemnity, (ii) under any bond, or (iii) to any insurance or condemnation proceeds or awards arising, in each case, from acts, omissions or events, or damage to or destruction of property, occurring prior to the

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Effective Date (subject to Section 11.16); (D) all oil, gas or other hydrocarbons produced and sold from the Subject Properties with respect to any period of time prior to the Effective Date, together with all proceeds from the sale or disposition thereof; (E) claims of Sellers for refunds of or loss carry forwards with respect to (i) production or any other taxes attributable to any period of time prior to the Effective Date, (ii) income or franchise taxes, or (iii) any taxes attributable to the Excluded Assets; (F) all amounts due or payable to Sellers as adjustments to insurance premiums related to the Subject Properties with respect to any period of time prior to the Effective Date; (G) all proceeds, income or revenues (and any security or other deposits made) attributable to (i) the Subject Properties for any period of time prior to the Effec tive Date, or (ii) any Excluded Assets; (H) all of Sellers’ proprietary computer software, patents, trade secrets, copyrights, names, trademarks, logos and other intellectual property; (I) all of Sellers’ seismic data; (J) all documents and instruments of Sellers that may be protected by an attorney-client privilege; (K) all audit rights with respect to any period of time prior to the Effective Date; and (L) those assets, if any, described on Exhibit “C” attached hereto; provided, however, to the extent that any of the foregoing assets relate to any liability or obligation constituting part of the Assumed Obligations, such assets shall not be Excluded Assets hereunder and shall be part of the Subject Properties for all purposes.

1.01.03

The conveyance of the Subject Properties shall be evidenced by an Assignment of Oil, Gas and Mineral Leases, Associated Rights and Bill of Sale (“Assignment”) in the form attached hereto as Exhibit “D”, and shall be effective as of January 1, 2008, at 7:00 a.m., Central Time (the “Effective Date”), which shall convey Sellers’ interest in the Subject Properties to Purchaser.

1.02

Consideration.  The consideration for the sale and conveyance of the Subject Properties by Sellers to Purchaser is Five Hundred Ninety Six Million Seven Hundred Eighty Thousand Dollars ($596,780,000), as adjusted in accordance with the terms of this Agreement (the “Purchase Price”).  

1.03

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

1.03.01

The Purchase Price shall be increased by the following:

(A)

expenses actually paid by any Seller or Will-Drill Production Co., Inc. (“WDP”) with respect to the ownership or operation of the Subject Properties, or any of them, which are for or relate to any period of time on or after the Effective Date and which were incurred in the ordinary course of business, consistent with past practice, including, without limitation, any such expenses relating to Wells Thomas 20 – No. 3, Wiggins 32 - No. 1 and Conly 30 – No. 2 attributable to or arising from or in connection with the operations described in the daily drilling reports attached hereto as Schedule 1.03.01(A); provided that for the purposes of this Section 1.03.01(A) expenses for drilling, completion or rework operations attributable to Wells FUMC 33 – No. 1, Thrash 16 – No.1 and Rex-Woodard 22 – No. 1 and incurred between the Effective Date and the date of

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this Agreement shall be limited to Four Hundred Forty Thousand Dollars ($440,000).

(B)

the total of all costs and expenses actually paid and incurred by Sellers for drilling, completion, equipping, operating and other costs and expenses actually paid and incurred by Sellers with respect to any producing Well in a unit on account of unleased mineral interests (“UMIs”) (such UMIs being set forth on Schedule 1.03.01(B)) in such unit to the extent that such costs and expenses have not been recouped by Sellers as of the Effective Date; and

(C)

the value (calculated in the same manner as specified in Section 6.03.04(A) and Section 6.03.04(B)) of an increase in Sellers' NRI over that set forth on Exhibit "A"  due to a clerical, typographical or mathematical error (including, without limitation, the erroneous failure to list a Subject Property on Exhibit “A” in which Sellers have an interest or to reflect a greater interest) or a decrease in Sellers' WI over that set forth on Exhibit "A" due to a clerical, typographical or mathematical error (including, without limitation, the erroneous listing of a Subject Property on Exhibit “A” in which Sellers do not have an interest or have a lesser interest).

1.03.02

The Purchase Price shall be decreased by the following:

(A)

all revenues received by Sellers and attributable to the Subject Properties for or relating to any period of time on and after the Effective Date;

(B)

the amount of the Deposit; and

(C)

the amount of any decreases due to Title Defects pursuant to ARTICLE VI, Environmental Conditions pursuant to ARTICLE X, Casualty Losses pursuant to Section 11.16 and the provisions of Section 3.02.

1.03.03

The Purchase Price shall be increased or decreased, as the case may be, by the following:

(A)

Suspense Funds as of Closing pursuant to Section 3.08; and

(B)

hydrocarbons in storage and pipelines pursuant to Section 3.07.

1.04

Adjustment Statement.  Sellers shall cause WDP to deliver to Purchaser on or prior to three (3) Business Days immediately preceding the Closing Date a statement (the “Adjustment Statement”) setting forth Sellers’ preliminary determination of the Adjusted Purchase Price.  The Adjustment Statement shall be based upon actual information available to Sellers at the time of its preparation.

1.05

Payment.  Contemporaneously with the execution of this Agreement, Purchaser has deposited an amount equal to ten percent (10%) of the Purchase Price with JPMorgan Chase Bank, National Association, as escrow agent for the Parties (the “Escrow Agent”), to be deposited into an interest bearing account, such escrow arrangement to be governed by the

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Escrow Agreement, among WDR, Purchaser and the Escrow Agent, entered into contemporaneously herewith (the “Escrow Agreement”) (such amount, together with interest thereon, the “Deposit”).  If Closing shall occur, Sellers and Purchaser agree that the Deposit shall be paid to Sellers (acting through WDR) by the Escrow Agent and shall be considered to have been applied toward the Purchase Price in accordance with Section 1.03.02(B).  If Closing shall not occur by reason of the termination of this Agreement, the Deposit shall be applied in the manner set forth in Section 9.02.  At the Closing, Purchaser shall wire transfer the Adjusted Purchase Price in immediately available funds as specified in writing by Sellers (acting through WDP) to Purchaser on the first (1^st) Business Day prior to the Closing Date.

1.06

Post Closing Review.  On or prior to the one hundred twentieth (120^th) day after the Closing Date but no sooner than ninety (90) days after the Closing Date, Sellers shall cause WDP to present Purchaser with a final adjustment statement (the “Final Adjustment Statement”).  Purchaser will give representatives of WDP reasonable access to its premises and to its books and records for purposes of preparing the Final Adjustment Statement and will cause appropriate personnel of Purchaser to provide reasonable assistance to WDP and WDP’s representatives, at no cost to Sellers, in the preparation of the Final Adjustment Statement.  Sellers will give representatives of Purchaser and its representatives reasonable access to their premises and to their books and records for purposes of reviewing the Final Adjustment Statement.  The Final A djustment Statement shall become final and binding on Sellers and Purchaser thirty (30) days following the date the Final Adjustment Statement is received by Purchaser, except to the extent that prior to the expiration of such thirty (30) day period Purchaser shall deliver to Sellers (acting through WDP) notice, as hereinafter described, of its disagreement with the contents of the Final Adjustment Statement.  Such notice shall be in writing and set forth all of Purchaser’s disagreements with respect to any portion of the Final Adjustment Statement, together with Purchaser’s proposed changes thereto, and shall include an explanation in reasonable detail of, and such supporting documentation as is reasonably necessary and available to support, such changes.  If Purchaser has timely delivered such a notice of disagreement to Sellers (acting through WDP), then, upon written agreement between Purchaser and Sellers (acting through WDP) resolving all disagreements of Purchaser set forth in such notice, the Final Adjustment Statement will become final and binding upon Purchaser and Sellers.  If the Final Adjustment Statement has not become final and binding by the sixtieth (60th) day following its receipt by Purchaser, then Purchaser or Sellers (acting through WDP) may submit any unresolved disagreements of Purchaser set forth in such notice to a mutually agreeable arbitrator (which arbitrator must have at least ten (10) years of experience in oil and gas accounting matters in Louisiana and must not have performed any material accounting work for the preceding twelve (12) months for any Party) for binding arbitration, in which case the Party doing so must also immediately notify the other Party by telephone and facsimile.  Any dispute regarding appointment of a mutually acceptable arbitrator shall be resolved by having Purchaser and Sellers (acting through WDP) each select one arbitrator meeting the criteria described above and instructing such two arbitrators to select a third arbitrator meeting the criteria described above.  Such third arbitrator or a mutually acceptable arbitrator, as applicable, shall be referred to herein as the “Accounting Arbitrator”.  The Accounting Arbitrator shall resolve disputes regarding any such adjustments within thirty (30) days of submittal by such Parties of the relevant materials for review taking into account, among other things, the likelihood the disputed item will cause either Purchaser or Sellers not to receive value bargained for under this Agreement and the length of time that the item has been treated by Sellers or their

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predecessors in the manner in which Sellers (acting through WDP) have asserted on the Final Adjustment Statement.  Each Party agrees to pay all amounts due as a result of the agreement or the decision of the Accounting Arbitrator on the third (3^rd) Business Day thereafter.  If payment is due for Sellers, the Seller that is an affiliate of WDP agrees to cause such payment to be timely made.  In the event of a Subsequent Closing or an Environmental Subsequent Closing, the provisions of this Section 1.06 shall also apply thereafter as to the applicable Subject Properties only.

1.07

Ownership; Allocation of Revenues and Expenses.  Subject to the other provisions of this Agreement, Sellers shall remain entitled to all of the rights of ownership of the Subject Properties (including, without limitation, the right to all production, proceeds of production and other proceeds) for the period of time prior to the Effective Date, and, after Closing, Purchaser shall be entitled to all of the rights of ownership of the Subject Properties (including, without limitation, the right to all production, proceeds of production and other proceeds) for the period of time on and after the Effective Date.  Subject to the terms and conditions of this Agreement, revenues and expenses attributable to the Subject Properties shall be allocated as follows:  (A) all expenses (including, without limitation, all drilling and completion costs, all capital expenditures, all ove rhead charges under applicable operating agreements and the amount of premiums under insurance policies maintained by WDP or Sellers) which are incurred in the operation of the Subject Properties before the Effective Date will be borne by Sellers and all proceeds (net of applicable production, severance, and similar taxes) from the sale of oil, gas and/or other minerals produced therefrom before the Effective Date will be owned by Sellers, and (B) all expenses (including, without limitation, all capital expenditures, all drilling and completion costs, all overhead charges under applicable operating agreements and the amount of premiums under insurance policies maintained by the operator of the Subject Properties) in connection with the operation of the Subject Properties after the Effective Date and paid or payable by Sellers under the applicable joint operating agreement will be borne by Purchaser and all proceeds (net of applicable production, severance, and similar taxes) from the sale of oil, gas an d/or other minerals produced therefrom after the Effective Date will be owned by Purchaser.  It is agreed that, in making such allocations:  (X) subject to Section 3.07, all oil which was produced from the Subject Properties and which was, on the Effective Date, stored in tanks located on the Subject Properties (or located elsewhere but used by Sellers to store oil produced from the Subject Properties prior to delivery to any oil purchaser) shall be deemed to have been produced before the Effective Date, and (Y) ad valorem taxes assessed with respect to a period of time which the Effective Date splits shall be prorated based on the number of days in such period of time which fall on each side of the Effective Date (with the day on which the Effective Date falls being counted in the period of time after the Effective Date).

1.08

Closing.  The completion of the purchase and sale of the Subject Properties as contemplated by this Agreement, as well as the physical act or acts of execution and delivery of the documents contemplated hereby and delivery of consideration as provided above (the “Closing”) shall occur at the offices of WDP at a time mutually acceptable to Sellers and Purchaser on or before February 29, 2008 (the “Closing Date”).

1.09

Allocation of Purchase Price.  Purchaser and Sellers agree that the entire Purchase Price (including any adjustments thereto) for the Subject Properties shall be allocated to "Class V assets" (as that term is defined in Treasury regulation section 1.338-6(b)(2)) in accordance with

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Section 1060 of the of the Code and the Treasury regulations thereunder.  Purchaser and Sellers shall file such reports and information returns as may be required under Section 1060 of the Code and the Treasury regulations thereunder and any corresponding provisions of applicable state income tax laws consistent with such allocation to the Class V assets.

ARTICLE II
REPRESENTATIONS AND WARRANTIES

2.01

Representations and Warranties of Each Seller.  Each Seller, for itself only, represents and warrants to Purchaser that the following are true and correct as of the date of this Agreement, and will be true and correct as of the Closing Date as if made on that date:

2.01.01

Organization and Authority.  For each Seller that is a legal entity, such Seller represents that it:

(A)

is duly organized, validly existing and in good standing under the Law of the state of its organization and it is in good standing in the jurisdictions where the Subject Properties are located;

(B)

has full power and authority to carry on its business as now being conducted in the places and manner as required to own and sell the interests owned by such Seller in the Subject Properties; and

(C)

is duly authorized by appropriate action of the board of directors, shareholders, members, managers, partners, venturers or others, as the case may be, to enter into this Agreement, to perform the obligations hereunder and to convey to Purchaser the Subject Properties.

2.01.02

Execution and Delivery/Enforceability.  This Agreement has been duly and validly executed and delivered by such Seller and constitutes, and all other agreements contemplated herein, when entered into, executed and delivered, will constitute, the legal, valid and binding agreements and obligations of such Seller enforceable against such Seller in accordance with their respective terms.

2.01.03

No Conflicts.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated by this Agreement do not and will not (A) conflict with or violate or constitute a default under any contract, agreement or other similar instrument governing such Seller’s organization or management or any agreement to which such Seller is a party or to which any of the Subject Properties is bound; or (B) violate any Law applicable to such Seller or the Subject Properties except for any violation which is not material and which would not affect such Seller’s ability to consummate the transactions contemplated under this Agreement.

2.01.04

Brokers’ Fees.  Such Seller has not incurred any obligation or liability, contingent or otherwise, for brokers’ or finders’ fees in respect of the transactions contemplated herein for which Purchaser or any of its affiliates may be liable.

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2.01.05

No Bankruptcy.  There are no bankruptcy, reorganization or arrangement proceedings pending, being contemplated by or, to such Seller’s knowledge, threatened against such Seller or any of its affiliates.

2.01.06

Litigation.

There is no suit, action or claim by any Person (including, without limitation, expropriation or forfeiture proceedings), and no legal, administrative or arbitration proceedings pending, or to such Seller’s knowledge, threatened against such Seller, or to which such Seller is a party, (in each case) that reasonably may be expected to have a materially adverse effect upon the ability of such Seller to consummate the transactions contemplated in this Agreement.

2.01.07

Non-Foreign Representation.  Such Seller is not a non-resident alien, foreign corporation, foreign partnership, foreign trust or foreign estate (as those terms are defined in the Code and income tax regulations).

2.01.08

Tax Exemption.  Such Seller acquired the tangible personal property included in the Subject Properties for use or consumption, and such Seller has not been engaged, nor held itself out as being engaged, in selling similar property on a repeated or continuing basis.

2.02

Representations and Warranties of Sellers.  Sellers, jointly and severally, represent and warrant to Purchaser that the following are true and correct as of the date of this Agreement, and will be true and correct as of the Closing Date as if made on that date:

2.02.01

AFE’s.  Except as set forth on Schedule 2.02.01, there are no outstanding calls or payments under authorities for expenditures for payments or other capital commitments relating to the Subject Properties which exceed Fifty Thousand Dollars ($50,000) (net to Sellers’ interest) for work performed between the Effective Date and the date hereof and thereafter.

2.02.02

Take or Pay/Prepayment Obligations.  Sellers have not entered into any contracts for or received prepayments under or pursuant to take-or-pay arrangements, buydowns, buyouts or similar agreements for hydrocarbons produced from the Subject Properties, or storage of the same which Purchaser shall be obligated to honor and make deliveries of hydrocarbons or pay refunds of amounts previously paid under such contracts or arrangements or which otherwise relate to deliveries of hydrocarbons or payments of refunds on or after the Effective Date.

2.02.03

Litigation.  There is no suit, action, claim or proceeding pending or, to Sellers’ knowledge, threatened, arising out of, or with respect to the ownership, operation or condition of the Subject Properties.    

2.02.04

Permits; Compliance with Law.  With respect to all Subject Properties for which any Seller is the operator, Sellers have, and, to Sellers’ knowledge, with respect to all other Subject Properties, the operator has, acquired all material Permits.  With respect to the Subject Properties for which any Seller is the operator, and, to Sellers’ knowledge, with respect to all other Subject Properties, such Subject Properties are in compliance with all applicable Law.

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2.02.05

Imbalances.  Except for normal immaterial pipeline imbalances that are adjusted by the pipeline each month, there are no wellhead imbalances or other imbalances attributable to the Subject Properties as of the Effective Date or as of the Closing Date which require payment from Purchaser to any Person or for which Purchaser would otherwise be responsible.

2.02.06

Consents and Preferential Rights.  Except as set forth on Schedule 2.02.06, there are no required consents, approvals or authorizations of any Person (excluding any of the foregoing customarily obtained following Closing), in each case, that are applicable to the transactions contemplated hereby.  There are no preferential rights to purchase attributable or with respect to any of the Subject Properties.

2.02.07

Taxes.  All ad valorem, property, production, severance and similar taxes and assessments based on or measured by the ownership of property comprising the Subject Properties or the production or removal of hydrocarbons or the receipt of proceeds therefrom (including, without limitation, applicable escheatment and unclaimed property requirements) have been timely paid when due and are not in arrears.  All sales and use taxes due with respect to tangible personal property included in the Subject Properties have been timely paid when due and are not in arrears.  All assets comprising the Subject Properties that are subject to property taxes have been properly listed and described on the property tax rolls for any period of time prior to and including Closing, and no portion of such assets constitutes omitted property for property tax purposes.  Seller s have timely filed all tax returns required to be filed and paid all taxes required to be paid with respect to the Subject Properties or the ownership or operation thereof.  No interest in the Subject Properties to be conveyed by any Seller to Purchaser pursuant to this Agreement constitutes a partnership interest for U.S. federal tax purposes.

2.02.08

Title.  Sellers or WDP have good title to the Subject Properties, free and clear of all liens, encumbrances and defects except for the Permitted Encumbrances, except that the foregoing representation shall not apply as to the Oil and Gas Properties, which shall instead be addressed by ARTICLE VI.

2.02.09

Leases.  To Sellers’ knowledge, the Leases have been maintained according to their terms and in compliance with the agreements to which such Leases are subject and there has not occurred any event, fact or circumstance which, with the lapse of time or the giving of notice, or both, would constitute such a breach or default of any such Leases on behalf of the Sellers or, to Sellers’ knowledge, with respect to any other Persons.  All of the Leases are either (i) currently held by production in accordance with their terms or (ii) not due to expire within six (6) months from the Closing Date because of the lack of production therefrom or because they contain a term based on a finite number of years.

2.02.10

Hydrocarbon Sales Contracts.  Except as set forth on Schedule 2.02.10, no hydrocarbons produced from the Subject Properties are subject to a sales contract other than division orders or sales agreements terminable on no more than thirty (30) days notice.  Proceeds from the sale of hydrocarbons produced from the Subject Properties are being received in all respects by Sellers in a timely manner and are not

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being held in suspense by the purchaser for any reason. To Sellers’ knowledge, Sellers are presently receiving a price for all production from, or attributable to, each Subject Property covered by a hydrocarbon sales contract in accordance with the terms of such contract.

2.02.11

Contracts.  Schedule 2.02.11 lists all Contracts, with the exception of damage releases for surface use or access agreements (the “Damage Contracts”) and confidentiality agreements executed by third parties and WDR pursuant to which information was delivered by The Oil and Gas Clearinghouse in connection with the evaluation of a possible purchase of the Subject Properties (the “Confidentiality Agreements”).  All Damage Contracts are substantially similar in all material respects to the sample of such Damage Contracts included on Schedule 2.02.11 and all Confidentiality Agreements are substantially similar in all material respects to the Confidentiality Agreement signed by Purchaser on November 27, 2007.  All Contracts are in full force and effect and Sellers are not, and, to Sellers’ kno wledge, no other Person is, in default with respect to any of the obligations thereunder.  As of Closing, true and complete copies of all Contracts shall have been provided to Purchaser.

2.02.12

Payout Balances.  Schedule 2.02.12 contains a true and complete list of the status of any payout balance (net to the interest of Sellers), as of December 31, 2007, for each Lease or Well that is subject to a reversion or other adjustment at some level of cost recovery or payout other than UMIs.

2.02.13

Expenses Paid.  

(A)

All expenses relating to the ownership or operation of the Subject Properties (including, without limitation, all bills for labor and materials and supplies used or furnished for use in connection with the Subject Properties) have been paid (timely, properly and before the same became delinquent) or are pending payment and are within payment terms.

(B)

 All royalties, overriding royalties and other burdens on production and all amounts owing to co-owners of the Subject Properties (in each case) relating to the ownership or operation of the Subject Properties have been paid (timely, properly and before the same became delinquent).

2.02.14

Condition of Personalty.  All fixtures, facilities and equipment included in the Subject Properties and that are reasonably necessary to conduct normal operations on the Subject Properties are in an operable state of repair adequate to maintain normal operations on the date of this Agreement.

2.02.15

Plugging and Abandonment.  Except as set forth on Schedule 2.02.15, there are no Wells that (A) any Seller has received an order from any Governmental Authority requiring that such Well be plugged and abandoned; or (B) were producing as of the Effective Date, but that are shut-in (unless temporarily shut-in in the course of normal operations) or abandoned.  Sellers are not aware of any Wells that were plugged

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and abandoned in contravention of any applicable requirements of any Governmental Authority having jurisdiction over the Subject Properties.

2.02.16

Environmental Conditions.  None of Sellers or their affiliates has received notice from any Person of any release, disposal, event, condition, circumstance, activity, practice or incident concerning any land, facility or property included in the Subject Properties that constitutes a violation of, interferes with or prevents compliance by Sellers, or, after Closing, Purchaser, with, any Environmental Law or the terms of any Permit issued pursuant thereto.

2.02.17

Bonds, Letters of Credit, etc.  Schedule 2.02.17 sets forth all bonds, letters of credit, guaranties and similar instruments held by any Seller, WDP or any of their respective affiliates and required by contract or applicable Law to be posted or otherwise tendered in order to own and/or operate any of the Subject Properties.

2.02.18

Interim Operations.  Sellers have not taken any actions between the Effective Date and the date of this Agreement that would have required consent under Section 3.03 if such actions were to have occurred subsequent to the date of this Agreement other than incurring expenditures for development of the Wells constituting Subject Properties referenced in Section 1.03.02(A) which have been previously disclosed to Purchaser.

2.02.19

Suspense Funds.  Schedule 2.02.19 sets forth a true and complete listing, as of December 31, 2007, showing all proceeds from production attributable to the Subject Properties which are held in suspense by Sellers (the “Suspense Funds”).

2.02.20

WDP as Operator.  WDP is the operator of all Wells listed on Exhibit “A”.

2.02.21

NRIs, WIs and UMIs.  The WIs and the NRIs reflected on Exhibit “A” do not include any interest attributable to UMIs.  Schedule 1.03.01(B) sets forth, as of the Effective Date, true and correct costs and expenses remaining to be recovered from each UMI listed on such Schedule 1.03.01(B).

2.02.22

HSR Act Matters.  Schedule 2.02.22 sets forth each Seller’s “ultimate parent entity” for the purposes of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and regulations thereunder (the “UPE”).  Each Seller represents that the portion of the Purchase Price attributable to it and its UPE in the aggregate equals less than Five Hundred Million Dollars ($500,000,000).

2.03

LIMITATIONS ON WARRANTIES AND OTHER DISCLAIMERS.  EXCEPT FOR THE SPECIAL WARRANTY OF TITLE SET FORTH IN THE ASSIGNMENT, THERE ARE NO WARRANTIES THAT ARE NOT CONTAINED WITHIN THIS AGREEMENT.  EXCEPT FOR THE SPECIAL WARRANTY OF TITLE SET FORTH IN THE ASSIGNMENT, THE EXPRESS REPRESENTATIONS AND WARRANTIES OF SELLERS CONTAINED IN SECTION 2.01 AND SECTION 2.02 ABOVE ARE EXCLUSIVE AND ARE IN LIEU OF, AND SELLERS EXPRESSLY DISCLAIM AND NEGATE AND PURCHASER HEREBY WAIVES, ALL OTHER REPRESENTATIONS AND WARRANTIES, EXPRESS,

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IMPLIED, STATUTORY OR OTHERWISE.  AS EXAMPLES, AND FOR THE AVOIDANCE OF DOUBT, BUT WITHOUT LIMITATION OF THE FOREGOING (AND SUBJECT TO THE SPECIAL WARRANTY OF TITLE SET FORTH IN THE ASSIGNMENT AND SELLERS’ REPRESENTATIONS CONTAINED IN SECTION 2.01 AND SECTION 2.02), THE SUBJECT PROPERTIES SHALL BE CONVEYED PURSUANT HERETO WITHOUT ANY WARRANTY OR REPRESENTATION WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO:  (A) THE QUANTITY, QUALITY, CONDITION, SIZE, WEIGHT, SERVICEABILITY, CONFORMITY TO SAMPLES OR MODELS OR ANY OTHER ASPECT OF THE WELLS, WELLBORES, FIXTURES, EQUIPMENT OR OTHER PERSONAL PROPERTY INCLUDED AMONG THE SUBJECT PROPERTIES, ALL OF WHICH SHALL BE CONVEYED TO PURCHASER AS IS, WHERE IS, AND WITH ALL FAULTS AND DEFECTS AND IN THE PRESENT CONDITION AND STATE OF REPAIR AND WITHOUT ANY WARRANTIES WHATSOEVER OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE; (B) THE ACCURACY OR COMPLETENESS OF ANY DATA, REPORTS, RECORDS, PROJECTIONS, INFORMATION OR MATERIALS NOW, HERETOFORE OR HEREAFTER FURNISHED OR MADE AVAILABLE TO PURCHASER IN CONNECTION WITH THIS AGREEMENT INCLUDING, WITHOUT LIMITATION, RELATIVE TO PRICING ASSUMPTIONS, OR QUALITY OR QUANTITY OF HYDROCARBON RESERVES (IF ANY) ATTRIBUTABLE TO THE SUBJECT PROPERTIES OR THE ABILITY OR POTENTIAL OF THE SUBJECT PROPERTIES TO PRODUCE HYDROCARBONS; (C) THE QUALITY, QUANTITY OR VOLUME OF THE RESERVES, IF ANY, OF OIL, GAS OR OTHER HYDROCARBONS IN OR UNDER THE SUBJECT PROPERTIES; (D) THE PHYSICAL AND ENVIRONMENTAL CONDITION OF THE SUBJECT PROPERTIES, BOTH SURFACE AND SUBSURFACE, INCLUDING BUT NOT LIMITED TO CONDITIONS SPECIFICALLY RELATED TO THE PRESENCE, RELEASE OR DISPOSAL OF HAZARDOUS SUBSTANCES, SOLID WASTES, ASBESTOS AND OTHER MAN MADE FIBERS, OR NORM; (E) THE COMPLETENESS OR ACCURACY OF INFORMATION CONTAINED IN THE DATA OR ANY OTHER MATERIALS FURNISHED OR MADE AVAILABLE TO PURCHASER B Y WDP OR BY SELLERS OR BY SELLERS’ AGENTS OR REPRESENTATIVES OR BY ANY OTHER PARTY, IT BEING AGREED BY PURCHASER THAT ANY AND ALL SUCH DATA, RECORDS, REPORTS, PROJECTIONS, INFORMATION AND OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED OR OTHERWISE MADE AVAILABLE OR DISCLOSED TO PURCHASER HAVE BEEN AND WILL BE PROVIDED TO PURCHASER AS A CONVENIENCE AND SHALL NOT CREATE OR GIVE RISE TO ANY LIABILITY OF OR AGAINST SELLERS AND ANY RELIANCE ON OR USE OF THE SAME SHALL BE AT PURCHASER’S SOLE RISK TO THE MAXIMUM EXTENT PERMITTED BY LAW; AND (F) ALL OTHER REPRESENTATIONS AND WARRANTIES, EXPRESS, IMPLIED OR STATUTORY.

2.04

Representations and Warranties of Purchaser.  Purchaser represents and warrants to Sellers that the following are true and correct as of the date of this Agreement, and will be true and correct as of the Closing Date as if made on that date:

2.04.01

Organization and Authority.  Purchaser is a corporation which:  

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(A)

is duly formed and validly existing under the Law of the state of its organization;

(B)

has full power and authority to carry on its business as now being conducted in the places and manner as required to purchase, own and operate the Subject Properties; and

(C)

is duly authorized by appropriate action of the board of directors, shareholders, partners, members or other governing body, as the case may be, to enter into this Agreement and to perform the obligations hereunder.

2.04.02

Execution and Delivery/Enforceability.  This Agreement has been duly and validly executed and delivered by Purchaser and constitutes, and all other agreements contemplated herein, when entered into, executed and delivered, will constitute the legal, valid and binding agreements and obligations of Purchaser enforceable against Purchaser in accordance with their respective terms.

2.04.03

No Conflicts.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated by this Agreement do not and will not (A) conflict with or violate or constitute a default under any agreement governing Purchaser’s organization or management or (B) violate any Law to which Purchaser is subject.

2.04.04

Brokers’ Fees.  Purchaser has not incurred any obligation or liability, contingent or otherwise, for brokers’ or finders’ fees in respect of the transactions contemplated herein for which Sellers or their affiliates may be liable.

2.04.05

Litigation.  There is no suit, action, or claim by any Person (including, without limitation, expropriation or forfeiture proceedings), and no legal, administrative, or arbitration proceedings pending, or to Purchaser’s knowledge, threatened against Purchaser, or to which Purchaser is a party, (in each case) that reasonably may be expected to have a materially adverse effect upon the ability of Purchaser to consummate the transactions contemplated in this Agreement.

2.04.06

Funding.  As of the Closing, Purchaser will have sufficient cash or other sources of immediately available funds to enable it to make the payments to Sellers contemplated by this Agreement.  

2.04.07

Knowledgeable Investor.  Purchaser is an experienced and knowledgeable investor in oil and gas properties and has the financial and business expertise to evaluate the merits and risks of the transactions contemplated by this Agreement.  In entering into this Agreement, Purchaser has relied solely on the express representations and covenants of Sellers in Section 2.01 and Section 2.02 of this Agreement, its independent investigation of, and judgment with respect to, the Subject Properties and the advice of its own legal, tax, economic, environmental, engineering, geological and geophysical advisors and not on any comments or statements of WDP or any Seller or any representatives of, or consultants or advisors engaged by, Sellers.

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2.04.08

No Distribution.  Purchaser is acquiring the Subject Properties for its own account and not with the intent to make a distribution thereof within the meaning of the Securities Act of 1933 (and the rules and regulations pertaining thereto) or a distribution thereof in violation of any other applicable securities laws.

ARTICLE III
COVENANTS PENDING CLOSING

3.01

Access.  Immediately following the execution of this Agreement and on a continuing basis until the Closing Date or, if applicable, the last Subsequent Closing or the Environmental Subsequent Closing (or earlier termination of this Agreement), Sellers will give Purchaser and its attorneys and other representatives access at all reasonable times (i) at the offices of WDP and each Seller during normal business hours, to Records and any other documents or information of Sellers pertaining to the ownership and/or operation of the Subject Properties and (ii) to the Subject Properties, including, without limitation, access to perform a Phase I environmental assessment of the Subject Properties.  Sellers shall not be obligated to provide Purchaser with access to any records or data which Sellers cannot legally provide to Purchaser without, in Sellers’ reasonable opinion, breaching any confidentiality, license or other agreements with other Persons (provided, however, that Sellers shall use their reasonable efforts to obtain all necessary consents and waivers to permit Purchaser access to such records and data affected thereby).  Purchaser shall not contact any third party to obtain any information concerning the Subject Properties without at least three (3) Business Days prior written notice to Sellers (acting through WDP) of such proposed contact, and Sellers (acting through WDP) shall have the right to have a representative present at or participate in any and all such contacts.  Purchaser recognizes and agrees that (A) all of such materials and information is subject to the Confidentiality Agreement signed by Purchaser on November 27, 2007; and (B) except for the representations and warranties made by the Sellers in Section 2.01 and Section 2.02, all materials made available to Purchaser (whether pursuant to this Section or otherwise) in connection with the transaction contemplated hereby are made available to it as an accommodation, and without representation or warranty of any kind as to the accuracy and completeness of such materials.  PURCHASER HEREBY AGREES TO DEFEND, INDEMNIFY, RELEASE, PROTECT, SAVE AND HOLD HARMLESS SELLERS AND WDP FROM AND AGAINST ANY AND ALL LOSSES ARISING OUT OF OR RELATING TO ANY PLANT, FIELD OR FACILITY VISIT, OR OTHER DUE DILIGENCE ACTIVITY, CONDUCTED BY PURCHASER OR ANY OF ITS AGENTS, REPRESENTATIVES, AFFILIATES, OFFICERS, MEMBERS, MANAGERS OR DIRECTORS INCLUDING, WITHOUT LIMITATION, ANY LOSSES RESULTING, IN WHOLE OR IN PART, FROM THE CONCURRENT OR JOINT NEGLIGENCE OR STRICT LIABILITY OF SELLERS OR WDP BUT EXCLUDING ANY LOSSES ARISING OUT OF OR RESULTING FROM THE SOLE OR GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY SELLER OR WDP.

3.02

Consent to Assign.  Upon the full and proper execution of this Agreement, Sellers will request from the Persons identified by Sellers (and in accordance with the documents creating such rights) those consents to assign that are applicable to the transactions contemplated hereby.  Sellers shall have no obligation to assure that such consents are obtained.  If any Person from whom a consent to assign is requested fails or refuses to give such consent, then, at Purchaser’s option:  (A)  the Subject Properties affected by such consent shall be withdrawn

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from the sale and retained by Sellers and the Purchase Price shall be reduced by an amount equal to the Allocated Value attributable to such withdrawn Subject Properties; or (B) Purchaser may waive the failure to receive the consent and proceed to purchase the affected portion of the Subject Properties and Purchaser shall indemnify and hold harmless Sellers from and against any and all Claims arising out of the failure to obtain such consent.

3.03

Interim Operations.  

3.03.01

Sellers covenant that from the date hereof until the Closing Date (and, if applicable, with respect to each Subject Property not conveyed at Closing until the applicable Subsequent Closing or the Environmental Subsequent Closing), except (i) as expressly provided herein or (ii) as otherwise consented to in writing by Purchaser, Sellers will not, and will cause WDP not to:  

(A)

operate or in any manner deal with, incur obligations with respect to, or undertake any transactions relating to, the Subject Properties other than transactions (1) in the normal, usual and customary manner, (2) of a nature and in an amount consistent with prior practice, (3) in the ordinary and regular course of business of owning and operating the Subject Properties, and (4) subject to the terms and conditions of this Agreement;

(B)

dispose of, encumber, abandon or relinquish any of the Subject Properties;

(C)

waive, compromise or settle any material right or claim;

(D)

introduce any new methods of management, operation or accounting with respect to any or all of the Subject Properties;

(E)

except to the extent necessary to avoid forfeiture of any Lease and except for emergency operations or as provided in this Section 3.03.01, not enter into agreements to drill new wells or to rework, plug back, deepen, plug or abandon any well, nor commence any drilling, reworking or completing or other operations on the Leases or other Subject Properties which require expenditures exceeding Fifty Thousand Dollars ($50,000) (net to Sellers’ interest) for each operation or Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate (net to Sellers’ interests);

(F)

voluntarily relinquish any position as operator of any Subject Property to anyone other than Purchaser;

(G)

grant any preferential or other right to purchase or agree to require the consent of any Person not otherwise required to consent to the transfer and assignment of the Subject Properties to Purchaser;

(H)

enter into any new sales contract or supply contract that cannot be cancelled upon thirty (30) days prior notice or that is for sales of hydrocarbons at less than a market price; or

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(I)

amend or modify any Contract.  

3.03.02

Sellers will (1) use commercially reasonable efforts to maintain and keep the Leases in full force and effect, and fulfill all contractual or other covenants, obligations and conditions imposed upon Sellers with respect to the Subject Properties, including, but not limited to, payment of royalties, delay rentals, shut-in gas royalties and any and all other required payments; (2) to the extent known to Sellers, provide Purchaser with written notice of (a) any claims, demands, suits or actions made against Sellers which materially affect the Subject Properties; or (b) any proposal from a third party to engage in any material transaction (e.g., a farmout) with respect to the Subject Properties; (3) maintain current insurance covering the Subject Properties until Closing and (4) provide prompt written notice to Purchaser of any notice received by Sellers of a default, claim, obl igation or suit which affects any of the Subject Properties.  In addition to the foregoing, during the period of time prior to Closing, Sellers shall use commercially reasonable efforts to take such actions as may be requested by Purchaser in writing (which writing shall include specific instructions and parameters with respect to such actions) in order to seek to obtain Permits required for drilling additional wells, to declare alternate unit wells, to secure surface access rights and rights-of-way and to build roads, locations and pipelines.  Purchaser hereby agrees directly to pay all third party service providers and out-of-pocket expenses incurred by Sellers in complying with such written requests and to defend, indemnify and hold harmless Sellers against all Claims arising from such actions (other than Claims due to Sellers' gross negligence or intentional misconduct).

3.04

Notice of Breach of Representations or Warranties.  Purchaser and Sellers will immediately notify the other upon the discovery that any representation or warranty made by such notifying Party is, becomes or will be untrue on the Closing Date.

3.05

Change of Operator; Subject Properties Held by WDP.  

3.05.01

Effective as of the Closing Date, Sellers will cause WDP to resign as operator of the Subject Properties and will assign all Permits, to the extent the same are assignable, to Purchaser or Purchaser’s designee.  Sellers will vote to name Purchaser or Purchaser’s designee as operator and will recommend to all other working interest owners in the Subject Properties that Purchaser or Purchaser’s designee be named as successor operator of the Subject Properties; provided that Sellers make no representation that any of such working interest owners will follow such recommendation.  If Purchaser is legally named as the operator of the Subject Properties or any portion thereof, Purchaser shall assume all responsibilities, obligations and liabilities of the operator with respect to such Subject Properties or portion thereof at the Closing Date or other date mutually agreed upon by Purchaser and Sellers (acting through WDP).  Within thirty (30) days after Closing, Purchaser shall have taken all actions necessary to be substituted as the operator on the records of all applicable Governmental Authorities and will remove all well signs and pipeline markers reflecting WDP as the operator.  Sellers shall have the right to remove all of such well signs and pipeline markers if not removed within thirty (30) days.  

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3.05.02

Sellers will cause WDP to assign to Purchaser the Subject Properties owned or held by WDP.

3.05.03

This Section 3.05 shall also apply to each Subsequent Closing and the Environmental Subsequent Closing with respect to the Subject Properties conveyed at such Subsequent Closing or the Environmental Subsequent Closing.

3.06

Governmental Filings.  To the extent applicable, Sellers and Purchaser shall in a timely manner make all required filings and prepare applications to and conduct negotiations with, each Governmental Authority as to which such filings, applications or negotiations are necessary or appropriate in the consummation of the transactions contemplated hereby and provide such information as any other may reasonably request in order to make such filings, prepare such applications and conduct such negotiations.  Each Party shall cooperate with and use all reasonable efforts to assist the other with respect to such filings, applications and negotiations.

3.07

Strapping and Gauging.  Sellers have caused the hydrocarbons in the storage facilities located on, or utilized in connection with, the Wells included in the Subject Properties to be measured, gauged or strapped as of the Effective Date.  Sellers have caused the production meter charts (or if such do not exist, the sales meter charts) on the pipelines transporting hydrocarbons from the Subject Properties to be read as of the Effective Date.  The Purchase Price shall be adjusted upward in accordance with Section 1.03.03(B) for all hydrocarbons in such storage facilities above the pipeline connection or through the meters on such pipelines as of the Effective Date, and upon Closing such hydrocarbons and the hydrocarbons placed in such storage facilities from and after the Effective Date and production upstream of the aforesaid meters shall belong to Purchaser and becom e part of the Subject Properties.

3.08

Suspense Funds Adjustment.  At Closing, the Suspense Funds as of the Closing shall be credited against the Purchase Price in accordance with Section 1.03.03(A) and Purchaser shall assume responsibility for the custody and distribution of those Suspense Funds so credited against the Purchase Price at Closing.  Prior to Closing, Sellers shall deliver to Purchaser a revised Schedule 2.02.19 which shall set forth a true and complete listing of the Suspense Funds as of January 31, 2008.

3.09

Exclusivity.  From the date hereof until the Closing Date (the “Exclusivity Period”), Sellers shall not deal, directly or indirectly, with any Person, other than Purchaser, regarding any transaction for the sale of the Subject Properties or otherwise inconsistent or conflicting with the transactions contemplated by this Agreement (a “Potential Transaction”) and, without the prior written consent of Purchaser, will not (i) solicit, initiate discussions, engage in or continue negotiations with any Person, other than Purchaser, relating to a Potential Transaction, (ii) provide information or documentation to any Person, other than Purchaser, relating to a Potential Transaction or (iii) enter into an agreement with any Person, other than Purchaser, relating to a Potential Transaction.  If any Seller receives any inquiry, offer or prop osal relating to any of the above, such Seller shall immediately notify Purchaser in writing thereof, including in such notice information as to the content and all material terms of such inquiry, offer or proposal.

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ARTICLE IV
CONDITIONS TO CLOSING

4.01

Conditions to Obligations of Sellers.  The obligations of Sellers to consummate the transactions contemplated under this Agreement are subject to the satisfaction, at or prior to Closing, of the following conditions (any or all of which may be waived by Sellers in their sole discretion):

4.01.01

Any failures of the representations and warranties of Purchaser contained in this Agreement to be true and correct at and as of Closing as if such representations and warranties were made at and as of Closing (or as to representations and warranties that refer to a specified date, on and as of such specified date), shall, in the aggregate, not be such as to materially and adversely impact the rights of Sellers under this Agreement or the documents delivered in connection with the transactions contemplated hereby.

4.01.02

Purchaser will have performed and complied with, or caused the performance of and compliance with, in all material respects, all the obligations, terms, conditions and agreements required by this Agreement to be performed or complied with by Purchaser (other than obligations, terms, conditions and agreements qualified by materiality, which will have been performed or complied with by Purchaser in all respects) on or prior to Closing, and Purchaser shall have delivered (or shall be ready, willing and able to deliver) to Sellers at Closing the Assignment and all of the other documents and instruments required to be delivered by Purchaser to Sellers pursuant to this Agreement.

4.01.03

Purchaser shall have wire transferred (or shall be ready, willing and able to wire transfer) the Adjusted Purchase Price in immediately available funds in accordance with the last sentence of Section 1.05.

4.01.04

As of Closing, no suit, action or other proceeding (excluding any suit, action or other proceeding initiated by any of the Parties or their affiliates) shall be pending or threatened before any Governmental Authority seeking (A) to restrain any Seller from consummating the transactions contemplated by this Agreement or (B) to prohibit the Closing.

4.02

Conditions to Obligations of Purchaser.  The obligations of Purchaser to consummate the transactions contemplated under this Agreement are subject to the satisfaction, at or prior to Closing, of the following conditions (any or all of which may be waived by Purchaser in its sole discretion):

4.02.01

Any failures of the representations and warranties of Sellers contained in this Agreement to be true and correct at and as of Closing as if such representations and warranties were made at and as of Closing (or as to representations and warranties that refer to a specified date, on and as of such specified date), shall, in the aggregate, not be such as to materially and adversely impact the present or future value of the Subject Properties or the rights of Purchaser under this Agreement or the documents delivered in

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connection with the transactions contemplated hereby or such as to materially impact the ability of Purchaser freely to own and operate the Subject Properties from and after Closing.

4.02.02

Sellers will have performed and complied with, or caused the performance and compliance with, in all material respects, all the obligations, terms, conditions, and agreements required by this Agreement to be performed or complied with by Sellers (other than obligations, terms, conditions, and agreements qualified by materiality, which will have been performed or complied with by Sellers in all respects) on or prior to Closing, and Sellers shall have delivered (or shall be ready, willing and able to deliver) to Purchaser at Closing the Assignment and all of the other documents and instruments required to be delivered by Sellers to Purchaser pursuant to this Agreement.

4.02.03

As of Closing, no suit, action or other proceeding (excluding any suit, action or other proceeding initiated by any of the Parties or their affiliates) shall be pending or threatened before any Governmental Authority seeking (A) to restrain Purchaser from consummating the transactions contemplated by this Agreement or (B) to prohibit the Closing.

ARTICLE V
CLOSINGS; DELIVERIES AT CLOSINGS

5.01

Deliveries at Closings.  At Closing (and, if applicable, each Subsequent Closing and each Environmental Subsequent Closing):

5.01.01

Sellers will deliver or cause to be delivered to Purchaser:

(A)

duly executed and acknowledged Assignment in sufficient counterparts for recordation purposes of each Seller and WDP;

(B)

duly executed letters in lieu of transfer orders (or similar documentation) prepared by Sellers in form and substance reasonably acceptable to Purchaser;

(C)

duly executed change of operator forms for filing with all applicable Governmental Authorities prepared by Sellers in form and substance reasonably acceptable to Purchaser for each of the Leases, Lands and Wells for which any Seller, WDP or any of their respective affiliates act as operator evidencing a transfer to Purchaser or Purchaser’s designee of operations on all such Leases, Lands and Wells;

(D)

a certificate of each Seller certifying that the conditions set forth in Section 4.02.01 and Section 4.02.02 have been satisfied;

(E)

a certificate of non-foreign status of each Seller which meets the requirements of Treasury Regulation Section 1.1445-2(b)(2); and

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(F)

such additional documents customary in similar transactions as may be reasonably requested by Purchaser to consummate the transactions contemplated by this Agreement (including, without limitation, such additional documents as may be required to fulfill Sellers’ obligations in Section 3.05.02).

5.01.02

Purchaser will deliver or cause to be delivered to Sellers:

(A)

a duly executed and acknowledged counterpart to the Assignment of Purchaser;

(B)

a certificate of Purchaser certifying that the conditions set forth in Section 4.01.01 and Section 4.01.02 have been satisfied; and

(C)

such additional documents customary in similar transactions as may be reasonably requested by Sellers to consummate the transactions contemplated by this Agreement.

5.02

Turn Over Possession.  At Closing (and, if applicable, each Subsequent Closing and each Environmental Subsequent Closing), Sellers shall turn over possession of the Subject Properties to Purchaser.

5.03

Succession by Purchaser.  Purchaser shall (A) furnish to Sellers such evidence (including, without limitation, evidence of satisfaction of all applicable bonding requirements) as Sellers may reasonably require that Purchaser is qualified with the applicable Governmental Authorities to succeed Sellers as the owner and, where applicable, that are required for Purchaser or its designee to become the operator of the Subject Properties and (B) execute and deliver to Sellers such forms as Sellers may reasonably request for filing with the applicable Governmental Authorities to reflect Purchaser’s assumption of plugging and abandonment liabilities with respect to the Wells located on the Subject Properties or on units in which the Subject Properties are included.

ARTICLE VI
TITLE ADJUSTMENTS

6.01

Warranty of Title.  

6.01.01

In the Assignment, Sellers shall warrant and defend title to the Subject Properties against the lawful claims and demands of all Persons whomsoever claim the same or any part thereof by, through or under Sellers or their affiliates, but not otherwise.

6.01.02

EXCEPT AS PROVIDED IN SECTION 6.01 (AND IN THE ASSIGNMENT) AND SECTION 2.02.08, AND SUBJECT TO PURCHASER’S REMEDIES FOR A BREACH BY SELLERS OF SECTION 3.03.01(B), WITHOUT LIMITING PURCHASER’S RIGHT TO ADJUST THE PURCHASE PRICE BY OPERATION OF SECTION 6.03:  (A) SELLERS MAKE NO WARRANTY OR REPRESENTATION, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, WITH

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RESPECT TO SELLERS’ TITLE TO ANY OF THE SUBJECT PROPERTIES AND (B) PURCHASER HEREBY ACKNOWLEDGES AND AGREES THAT PURCHASER’S SOLE REMEDY FOR ANY TITLE DEFECT WITH RESPECT TO ANY OF THE SUBJECT PROPERTIES SHALL BE PURSUANT TO THE PROCEDURES SET FORTH IN THIS ARTICLE VI, WHICH REMEDIES SHALL CEASE, AND BE DEEMED TO BE FINALLY AND CONCLUSIVELY SATISFIED, IN ALL RESPECTS, UPON THE CLOSING OR, AS TO TITLE DEFECT PROPERTIES, UPON THE SUBSEQUENT CLOSING OR, AS TO THE SUBJECT PROPERTIES WITH DISPUTED ADVERSE ENVIRONMENTAL CONDITIONS, THE ENVIRONMENTAL SUBSEQUENT CLOSING.

6.02

Certain Definitions.

6.02.01

For purposes of this Agreement, “Defensible Title” shall mean with respect to the Oil and Gas Properties such title as (A) will, as of the Effective Date and the Closing, entitle the owner of a particular Oil and Gas Property to receive payment for production from such Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property in an amount not less than the net revenue interest (“NRI”) for such Oil and Gas Property as set forth on Exhibit “A” (except for any reduction caused by Purchaser); (B) will, as of the Effective Date and the Closing, obligate the owner of a particular Oil and Gas Property to bear no greater working interest (“WI”) share of costs and expenses attributable to the maintenance, development and operation of such Oil and Gas Property t hroughout the commercially productive life of such Oil and Gas Property than the WI for such Oil and Gas Property identified on Exhibit “A” without a proportionate increase in the NRI; and (C) is free and clear of all liens, encumbrances or security interests except for Permitted Encumbrances; provided, however, that Permitted Encumbrances shall be disregarded for the purposes of determining Defensible Title.  For purposes of this Agreement, Defensible Title to any Oil and Gas Property shall not include any depths below the Cotton Valley Formation as defined by orders of the Office of Conservation of the State of Louisiana for the units included in the Subject Properties.

6.02.02

For purposes hereof “Oil and Gas Property” shall mean each Well and each location for any undrilled well described on Exhibit “A”.

6.02.03

For purposes hereof “Permitted Encumbrances” shall mean (A) the terms, conditions, restrictions, exceptions, reservations, limitations and other matters contained in the agreements, instruments and other documents which create or reserve to Sellers their interest in the Subject Properties, provided that the same do not (i) reduce the NRI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property below that set forth on Exhibit “A” for such Oil and Gas Property, (ii) increase the WI throughout the commercially productive life of such Oil and Gas Property in an Oil and Gas Property above that set forth on Exhibit “A” for such Oil and Gas Property without a proportionate increase in the NRI for such Oil and Gas Property throughout the commercially p roductive life of such Oil and Gas Property, or (iii) materially adversely affect the ownership, operation, value or use of the Subject Properties taken as a whole; (B) customary liens (not yet due or being contested in good

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faith by appropriate proceedings), charges, encumbrances, defects and irregularities that may exist, including, but not limited to, defects in the early chain of title such as failure to recite marital status in documents, omission of succession or heirship proceedings, lack of survey, mortgages granted by lessors without subordinations, defects that have been cured by possession and failure to record releases of liens, production payments, leases or mortgages that have expired by their terms; (C) statutory and conventional liens securing payments to operators, mechanics and materialmen or others, payments of taxes or other claims or payment obligations that are, in each case, not yet delinquent; (D) any obligations or duties to any Governmental Authority with respect to any Permit and any applicable Law; (E) any easements, rights-of-way, servitudes, Permits and other rights in respect of surface operations, pipelines or the like, and easements for pipelines, power lines and other similar rights-of-way, and encroachments, on, over or in respect of any of the Oil and Gas Properties that do not materially adversely affect the ownership, operation, value or use of the Subject Properties taken as a whole; (F) all royalties, overriding royalties, net profits interests, production payments, carried interests, reversionary interests, calls on production and other burdens on or deductions from the proceeds of production that do not operate to (i) reduce the NRI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property below that set forth on Exhibit “A” for such Oil and Gas Property or (ii) increase the WI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property above that set forth on Exhibit “A” for such Oil and Gas Property without a proportiona te increase in the NRI for such Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property; (G) the terms and conditions of all production sales contracts, transportation agreements, pooling agreements, unitization agreements, operating agreements, processing agreements, and all other contracts, agreements and instruments related to or utilized in connection with the Leases, or the production, storage, treatment, transportation, sale or disposal of oil, gas or other hydrocarbons, mineral or substances therefrom; provided that the same do not (i) reduce the NRI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property below that set forth on Exhibit “A” for such Oil and Gas Property, (ii) increase the WI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property above that set forth on Exhibit “A” for such Oil and Gas Property withou t a proportionate increase in the NRI for such Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property, or (iii) materially adversely affect the ownership, operation, value or use of the Subject Properties taken as a whole; (H) conventional rights of reassignment prior to abandonment; (I) any required third party consents to assignment or similar restrictions on conveyance with respect to which before Closing (i) waivers or consents have been obtained from the appropriate Person, (ii) the applicable period of time for asserting such rights has expired (or, if period of time is specified in the contract or agreement creating such right, a period of time of at least thirty (30) days has elapsed between the date of the notice to such Person and the Closing Date) without the Sellers having received an election to exercise such preferential right or an election to withhold consent, (iii) Purchaser has waived the failure to obtain the required wai ver or consent, or (iv) the consent is of a type normally obtained after closing; and (J) any other liens, charges, encumbrances, contracts, agreements, instruments, obligations, defects or irregularities of

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any kind whatsoever affecting the Subject Properties that individually or in the aggregate are not such as would materially adversely affect the ownership, operation, value or use of the Subject Properties taken as a whole and would not (i) reduce the NRI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property below that set forth on Exhibit “A” for such Oil and Gas Property or (ii) increase the WI in an Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property above that set forth on Exhibit “A” for such Oil and Gas Property without a proportionate increase in the NRI for such Oil and Gas Property throughout the commercially productive life of such Oil and Gas Property.

6.03

Purchaser’s Title Review.

6.03.01

Purchaser’s Assertion of Title Defects.  Purchaser shall promptly upon discovery notify Sellers (acting through WDP) in writing of any matters which, in Purchaser’s reasonable opinion, constitute Title Defects pursuant to this ARTICLE VI.  Purchaser shall not be entitled to a Purchase Price adjustment for a Title Defect unless and until (i) the amount attributable to each Title Defect exceeds Thirty Thousand Dollars ($30,000) and (ii) all amounts attributable to all uncured Title Defects exceed One Million Dollars ($1,000,000) (the “Title Defect Threshold”) (at which time Purchaser shall be entitled to a Purchase Price adjustment for all amounts attributable to any Title Defect).  Except for remedies for breach of Sellers’ special warranty in the Assignment and any breach by Sellers of Section 3.03.01(B)< /U>, for all purposes of this Agreement, Purchaser shall be deemed to have waived any Title Defect which Purchaser fails to assert as a Title Defect by written notice given to Sellers (acting through WDP) on or before 4:00pm Mountain Time on the thirtieth (30^th) day from the date of this Agreement (the “Defect Notice Date”).  To be effective, Purchaser’s written notice of a Title Defect must include (i) a description of the matter constituting the asserted Title Defect sufficiently detailed to reasonably identify and explain the asserted Title Defect and the basis therefor, (ii) the claimed Title Defect Amount attributable thereto, (iii) supporting documents reasonably necessary for Sellers (as well as any title attorney or examiner hired by Sellers) to verify the existence of such asserted Title Defect and (iv) Purchaser's preferences, if any, as to the cure for such Title Defect.  If Sellers effect the cure specified by Purchaser in its notice as the prefer red cure, then such Title Defect shall be deemed cured.