LIMITED PARTNERSHIP ASSET PURCHASE AND SALE AGREEMENT

Exhibit 2.2

LIMITED PARTNERSHIP ASSET PURCHASE AND SALE AGREEMENT

Appalachia Region

between

Linn Energy Holdings, LLC

Marathon 85-II Limited Partnership and

Marathon 85-III Limited Partnership
as “LP Sellers”

And

XTO Energy Inc.

as “Buyer”

Dated as of April 13, 2008

TABLE OF CONTENTS

ii

Exhibits

A              Leases

B              Excluded LP Assets

C              Allocation of Purchase Price

D              Form of Assignment

iii

Schedules

2.5           Purchase Price Tax Allocations

4               LP Sellers Disclosure Schedule

12.10       LP Sellers Bonds

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LIMITED PARTNERSHIP ASSET PURCHASE AND SALE AGREEMENT

THIS LIMITED PARTNERSHIP ASSET PURCHASE AND SALE AGREEMENT dated April 13, 2008, is made by and between Linn Energy Holdings, LLC, a Delaware limited liability company (“ LEH ”), Marathon 85-II Limited Partnership, a West Virginia limited partnership, and Marathon 85-III Limited Partnership, a West Virginia limited partnership (collectively “ LP Sellers ”), and XTO Energy Inc., a Delaware corporation (“ Buyer ”).

RECITALS:

A.             LP Sellers desire to sell and assign to Buyer, and Buyer desires to accept from LP Sellers, certain oil and gas properties and related assets located in the Appalachia Region.

B.             LP Sellers and Buyer deem it in their mutual best interests to execute and deliver this Agreement.

NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual covenants and agreements contained herein, LP Sellers and Buyer do hereby agree as follows:

AGREEMENT:

ARTICLE I
LP Properties

Section 1.1.            Assets Included .  Subject to Section 1.2 , LP Sellers agree to sell and Buyer agrees to accept, for the consideration hereinafter set forth, and subject to the terms and provisions herein contained, all of LP Sellers’ rights, titles and interests in and to the following:

(a)            All right, title and interest of LP Sellers in and to the Leases described on Exhibit A attached hereto and made a part hereof for all purposes (and any ratifications and/or amendments to such Leases, whether or not such ratifications or amendments are described on such Exhibit A);

(b)            Without limitation of the foregoing but subject to Section 1.2 , all other right, title and interest (of whatever kind or character, whether legal or equitable, and whether vested or contingent) of LP Sellers in and to the oil, gas, and other minerals in and under or that may be produced from the lands described in Exhibit A or described in any of the Leases described on such Exhibit A (including interests in Leases, overriding royalties, production payments and net profits interests in such lands or such Leases, and fee mineral interests, fee royalty interests, and other interests in so far as they cover such lands), even though LP Sellers’ interest therein may be incorrectly described in, or omitted from, such Exhibit A ;

(c)            All rights, titles and interests of LP Sellers in and to, or otherwise derived from, all presently existing and valid oil, gas, or mineral unitization, pooling, or communitization agreements, declarations, and/or orders and in and to the properties covered and the units created thereby (including all units formed under orders, rules, regulations, or other official acts of any federal, state, or other authority having jurisdiction, voluntary unitization agreements,

designations and/or declarations) relating to the properties described in paragraphs (a)  and (b)  above;

(d)            All rights, titles, and interests of LP Sellers in and to the Material Contracts and all presently existing and valid production sales (and sales related) contracts, operating agreements, and other agreements and contracts which relate to any of the properties described in paragraphs (a ), (b)  and (c)  above, or which relate to the exploration, development, operation, or maintenance thereof or the treatment, storage, transportation or marketing of production therefrom (or allocated thereto);

(e)            All rights, titles, and interests of LP Sellers in and to all materials, supplies, machinery, equipment, improvements and other personal property and fixtures (including all wells, wellhead equipment, pumping units, flowlines, tanks, buildings, injection facilities, saltwater disposal facilities, compression facilities, gathering systems, and other equipment), and all easements, rights-of-way, surface leases and other surface rights, all Permits and licenses, and all other appurtenances being used or held for use in connection with, or otherwise related to, the exploration, development, operation or maintenance of any of the properties described in paragraphs (a) , (b)  and (c)  above, or the treatment, storage, transportation, or marketing of production therefrom (or allocated thereto); and

(f)             Subject to any third party rights, all of LP Sellers’ rights, titles and interests in and to lease files, title opinions, production records, well files, accounting records (but not including general financial and accounting records attributable to LP Sellers or LP Sellers’ business), seismic records and surveys, gravity maps, electric logs, geological or geophysical data and records, and other files, documents and records of every kind and description which relate to the properties described above (the “ Records ”); provided, however that LP Sellers may retain copies of any or all of the Records.

As used herein:  (i) “ LP Oil and Gas Properties ” means the properties and interests described in paragraphs (a) , (b)  and (c)  above, save and except for any such properties or assets that are LP Excluded Assets; and (ii) “ LP Properties ” means the LP Oil and Gas Properties plus the properties and interests described in paragraphs (d) , (e) , and (f)  above, save and except for any such properties or assets that are LP Excluded Assets.

Section 1.2.            Assets Excluded .  Notwithstanding anything herein contained to the contrary, the LP Properties do not include, and there is hereby excepted and reserved unto LP Sellers all other assets, properties, and business of LP Sellers, including the following:

(a)            Any accounts receivable or accounts payable accruing before the Effective Date;

(b)            All of LP Sellers’ right, title, and interest in any oil, gas, or mineral Leases, overriding royalties, production payments, net profits interests, fee mineral interests, fee royalty interests and other interests in oil, gas, and other minerals not expressly included in the definition of LP Oil and Gas Properties and all oil, gas or other hydrocarbon production from or attributable to the LP Properties with respect to all periods prior to the Effective Date, all proceeds attributable thereto, and all Hydrocarbons that, at the Effective Date, are owned by LP Sellers and are in storage or within processing plants;

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(c)            Any rebate or refund of costs, Taxes, or expenses borne by LP Sellers or LP Sellers’ predecessors in title attributable to periods prior to the Effective Date;

(d)            Any and all proceeds from the settlements of contract disputes with purchasers of Hydrocarbons from the LP Properties, including settlement of take-or-pay disputes, insofar as said proceeds are attributable to periods of time prior to the Effective Date;

(e)            Any and all proceeds from settlements with regard to reclassification of oil or gas produced from the LP Properties, insofar as said proceeds are attributable to periods of time prior to the Effective Date;

(f)             All contracts of insurance or indemnity;

(g)            All claims (including insurance claims) and causes of action of LP Sellers against one or more third parties arising from acts, omission, or events occurring prior to the Effective Date and all claims under any joint interest audit attributable to any period prior to the Effective Date;

(h)            All limited partnership, financial, tax, and legal (other than title) books and records of LP Sellers;

(i)             Any geological, geophysical or seismic data, materials, or information, including maps, interpretations, records, or other technical information related to or based upon any such data, materials or information, and any other asset, data, materials, or information, the transfer of which is restricted or prohibited under the terms of any third party license, confidentiality agreement, or other agreement or the transfer of which would require the payment of a fee or other consideration to any third party; provided, however, that if any such data, materials, or information is transferable upon payment of a fee or other consideration, and if Buyer has paid such fee or other consideration prior to the LP Closing Date, then such data, materials, or information shall be transferred to Buyer;

(j)             All share drive and accounting servers related to the LP Properties regardless of where such servers are located;

(k)            All of LP Sellers’ accounting or other administrative systems, computer software, patents, trade secrets, copyrights, names, trademarks, logos, and other intellectual property;

(l)             All documents and instruments of LP Sellers that may be protected by an attorney-client privilege (exclusive of title opinions in respect of the LP Oil and Gas Properties and all documents and instruments related to any matters in LP Sellers Disclosure Schedule);

(m)           All of the other properties, interests and assets described on Exhibit B , together with any rights, liabilities, or obligations associated with such assets;

(n)            The Existing Hedges and all hedging transactions and any gains or losses attributable to any hedging activities, whether occurring before or after the Effective Date;

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(o)            Any other right or interest in and to the LP Properties to the extent attributable to the period prior to the Effective Date;

(p)            All bonds, letters of credit and guarantees if any, posted by LP Sellers or any Affiliate with any Governmental Authority or third person and relating to the LP Properties;

(q)            All (i) correspondence or other documents or instruments of LP Sellers relating to the transactions contemplated hereby, (ii) lists of other prospective purchasers of LP Sellers or the LP Properties compiled by LP Sellers, (iii) bids submitted to LP Sellers by other prospective purchasers of LP Sellers or the LP Properties, (iv) analyses by LP Sellers or any Affiliates thereof submitted by other prospective purchasers of LP Sellers or the LP Properties, and (v) correspondence between or among LP Sellers or their Affiliates or their respective representatives with respect to, or with, any other prospective purchasers of LP Sellers or the LP Properties; and

(r)             All assets associated with LP Sellers’ Affiliate, Mid Atlantic Well Service, Inc., and its operations.

The properties and interests specified in the foregoing paragraphs (a)  through (r)  of this Section 1.2 are herein collectively called the “ LP Excluded Assets ”.  It is understood that certain of the LP Excluded Assets may not be embraced by the term “LP Properties”.  The fact that certain assets have been expressly excluded is not intended to suggest that had they not been excluded they would have constituted LP Properties and may not be used to interpret the meaning of any word or phrase used in describing the LP Properties.

ARTICLE II
Purchase Price

Section 2.1.            Purchase Price .  In consideration of the sale of the LP Properties by LP Sellers to Buyer, Buyer shall pay to LP Sellers cash in the amount of THREE HUNDRED THOUSAND AND NO/100 DOLLARS ($300,000.00) (the “ Purchase Price ”). The Purchase Price, as adjusted pursuant to this Article II and the other applicable provisions hereof, is herein called the “ Adjusted Purchase Price ”.

Section 2.2.            Accounting Adjustments .

(a)            Subject to Section 2.2(b) , and in addition to other adjustments to the Purchase Price provided for in this Agreement, appropriate adjustments shall be made between Buyer and LP Sellers so that:

(i)             all expenses (including all drilling costs, all capital expenditures, and all overhead administrative charges under applicable operating agreements, and all other operating costs actually charged by third parties) for work done in the operation of the LP Properties on or after the Effective Date will be borne by Buyer, and all proceeds (net of applicable gathering, transportation charges as well as production, severance, and similar Taxes) from the sale of oil, gas or other minerals produced from the LP Oil and Gas LP Properties on or after the Effective Date will be received by Buyer, and

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(ii)            all expenses for work done in the operation of the LP Properties before the Effective Date will be borne by LP Sellers and all proceeds (net of applicable production, severance, and similar Taxes) from the sale of oil, gas, or other minerals produced therefrom before the Effective Date will be received by LP Sellers.

(b)            It is agreed that, in making the adjustments contemplated by Section 2.2(a) :

(i)             Oil which was produced from the LP Oil and Gas Properties and which was, on the Effective Date, stored in tanks, but without taking into account tank bottom sediment and water,  located on the LP Oil and Gas Properties (or located elsewhere but used to store oil produced from the LP Oil and Gas Properties prior to delivery to oil purchasers) and above pipeline connections shall be deemed to have been produced before the Effective Date (it is recognized that such tanks were not gauged on the Effective Date for the purposes of this Agreement and that determination of the volume of such oil in storage will be based on the best available data, which may include estimates),

(ii)            ad valorem Taxes assessed with respect to a period which begins before and ends on or after the Effective Date shall be prorated based on the number of days in such period which fall on each side of the Effective Date (with the day on which the Effective Date falls being counted in the period after the Effective Date), and

(iii)           no consideration shall be given to the local, state, or federal income tax liabilities of any party.

Section 2.3.            LP Closing and Post-LP Closing Accounting Settlements .

(a)            No later than three (3) business days prior to the LP Closing Date, the parties shall determine, based upon the best information reasonably available to them, the amount of the adjustments provided for in Section 2.2 .   If the amount of adjustments so determined which would result in a credit to Buyer exceed the amount of adjustments so determined which would result in a credit to LP Sellers, Buyer shall receive a credit, for the amount of such excess, against the Purchase Price to be paid at LP Closing, and, if the converse is true, Buyer shall pay to LP Sellers, at LP Closing (in addition to amounts otherwise then owed), the amount of such excess.

(b)            On or before 120 days after LP Closing, Buyer and LP Sellers shall review any additional information which may then be available pertaining to the adjustments provided for in Section 2.2 , shall determine if any additional adjustments (whether the same be made to account for expenses or revenues not considered in making the adjustments made at LP Closing, or to correct errors made in such adjustments) should be made beyond those made at LP Closing, and shall make any such adjustments by appropriate payments from LP Sellers to Buyer or from Buyer to LP Sellers.   Following such additional adjustments, no further adjustments to the Purchase Price shall be made under this Section 2.3 .

(c)            If a dispute arises under Section 2.3(b)  with respect to any additional adjustments (an “ Accounting Dispute ”) that the parties have been unable to resolve prior to the end of the 120 day period in Section 2.3(b)  above, then, at the written request of either LP Sellers or Buyer

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(the “ Request Date ”), each of LP Sellers and Buyer shall nominate and commit one of their senior officers to meet at a mutually agreed time and place not later than ten days after the Request Date to attempt to resolve same.  If such senior officers have been unable to resolve such Accounting Dispute within a period of 30 days after the Request Date, any party shall have the right, by written notice to the other specifying in reasonable detail the basis for the Accounting Dispute, to resolve the Accounting Dispute by submission thereof to a independent public accounting firm mutually agreeable to the Parties, which firm shall serve as sole arbitrator (the “ Accounting Referee ”).  The scope of the Accounting Referee’s engagement shall be limited to the resolution of the items described in the notice of the Accounting Dispute given in accordance with the foregoing and the corresponding calculation of the adjustments pursuant to Section 2.2 .  The Accounting Referee shall be instructed by the parties to resolve the Accounting Dispute as soon as reasonably practicable in light of the circumstances but in no event in excess of 15 days following the submission of the Accounting Dispute to the Accounting Referee.  The decision and award of the Accounting Referee shall be binding upon the parties as an award under the Federal Arbitration Act and final and nonappealable to the maximum extent permitted by law, and judgment thereon may be entered in a court of competent jurisdiction and enforced by any party as a final judgment of such court.  The fees and expenses of the Accounting Referee shall be borne equally by LP Sellers and Buyer.

Section 2.4.            Payment of Adjusted Purchase Price .  The Adjusted Purchase Price shall be paid to LP Sellers as follows:

(a)            At the LP Closing, Buyer shall pay to LP Sellers cash equal to the Adjusted Purchase Price;

(b)            All cash payments by Buyer pursuant to this Section 2.4 shall be made in immediately available funds by confirmed wire transfer to a bank account or accounts designated by LP Sellers, as applicable.

Section 2.5.            Allocation of Purchase Price .  (a) On or before the fifth business day following execution and delivery of this Agreement by LP Sellers and Buyer, Buyer, using its reasonable business judgment, shall allocate the Purchase Price among the LP Oil and Gas Properties on Exhibit C and shall furnish the completed Exhibit C to LP Sellers, whereupon both parties shall attach the completed Exhibit C to this Agreement with the same effect as if the completed Exhibit C was attached to and made part of this Agreement at signing.  (b) On or before the LP Closing Date, the Buyer and LP Sellers shall agree in writing as to the allocation of the Adjusted Purchase Price among the LP Properties under the methodology required by Section 1060 of the Code.  Such agreed allocation shall be set forth on Schedule 2.5 attached hereto.  The Buyer and LP Sellers shall report the transactions contemplated hereby on all Tax Returns, including, but not limited to Form 8594, in a manner consistent with such allocation.  If, contrary to the intent of the parties hereto as expressed in this Section 2.5 , any taxing authority makes or proposes an allocation different from the allocation determined under this Section 2.5 , Buyer and LP Sellers shall cooperate with each other in good faith to contest such taxing authority’s allocation (or proposed allocation), provided, however, that, after consultation with the party adversely affected by such allocation (or proposed allocation), the other party hereto may file such protective claims or Tax Returns as may be reasonably required to protect its interests.

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ARTICLE III
The LP Closing

The closing of the transactions contemplated hereby (the “ LP Closing ”) shall take place (i) at the offices of LP Sellers at 600 Travis Street, Suite 5100, Houston, Texas 77002, at 10:00 a.m. (local Houston, Texas time) on July 1, 2008 , or (ii) at such other time or place or on such other date as the parties hereto shall agree.  The date on which the LP Closing is required to take place is herein referred to as the “ LP Closing Date ”.  All LP Closing transactions shall be deemed to have occurred simultaneously.

ARTICLE IV
Disclaimer of Representations and Warranties by LP Sellers

Section 4.1.            No Conveyances.   Except as set out in Section 4.1 of LP Sellers’ Disclosure Schedule, LP Sellers have not voluntarily sold or conveyed any of the LP Properties or any interest therein to any person or entity other than to the other partners in the LP Sellers prior to the date of this Agreement.

Section 4.2 .           Disclaimer of Representations and Warranties.   LP Sellers hereby expressly disclaim any and all representations or warranties with respect to the LP Properties or the transactions contemplated hereby.  Buyer agrees that the LP Properties are being sold by each LP Seller “where is” and “as is”, with all faults.  Specifically as a part of (but not in limitation of) the foregoing, Buyer acknowledges that LP Sellers have not made, and LP Sellers hereby expressly disclaim, any representation or warranty (express, implied, under common law, by statute or otherwise) as to the title or condition of the LP Properties (INCLUDING ANY IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR CONFORMITY TO MODELS OR SAMPLES OF MATERIALS) .  LP SELLERS MAKE NO REPRESENTATION OR WARRANTY AS TO (I) THE AMOUNT, VALUE, QUALITY, QUANTITY, VOLUME, OR DELIVERABILITY OF ANY OIL, GAS, OR OTHER MINERALS OR RESERVES (IF ANY) IN, UNDER, OR ATTRIBUTABLE TO THE LP PROPERTIES, (II) THE PHYSICAL, OPERATING, REGULATORY COMPLIANCE, SAFETY, OR ENVIRONMENTAL CONDITION OF THE PROPERTIES, BOTH SURFACE AND SUBSURFACE, INCLUDING MATTERS RELATED TO THE PRESENCE, RELEASE OR DISPOSAL OF HAZARDOUS MATERIALS, SOLID WASTES, ASBESTOS OR NATURALLY OCCURRING RADIOACTIVE MATERIALS ( “ NORM ” ), OR (III) THE GEOLOGICAL OR ENGINEERING CONDITION OF THE LP PROPERTIES OR ANY VALUE THEREOF.  LP SELLERS MAKE NO WARRANTY OR REPRESENTATION, EXPRESS, STATUTORY, OR IMPLIED, AS TO (A) THE ACCURACY, COMPLETENESS, OR MATERIALITY OF ANY DATA, INFORMATION, OR RECORDS FURNISHED TO BUYER IN CONNECTION WITH THE LP PROPERTIES OR OTHERWISE CONSTITUTING A PORTION OF THE LP PROPERTIES; (B) THE PRESENCE, QUALITY, AND QUANTITY OF HYDROCARBON RESERVES (IF ANY) ATTRIBUTABLE TO THE LP PROPERTIES; (C) THE ABILITY OF THE LP PROPERTIES TO PRODUCE HYDROCARBONS, INCLUDING PRODUCTION

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RATES, DECLINE RATES, AND RECOMPLETION OPPORTUNITIES; (D) IMBALANCE OR PAYOUT ACCOUNT INFORMATION, ALLOWABLES, OR OTHER REGULATORY MATTERS, (E) THE PRESENT OR FUTURE VALUE OF THE ANTICIPATED INCOME, COSTS, OR PROFITS, IF ANY, TO BE DERIVED FROM THE LP PROPERTIES, (F) THE ENVIRONMENTAL CONDITION OF THE LP PROPERTIES, (G) ANY PROJECTIONS AS TO EVENTS THAT COULD OR COULD NOT OCCUR, (H) ANY OTHER MATTERS CONTAINED IN OR OMITTED FROM ANY INFORMATION OR MATERIAL FURNISHED TO BUYER BY LP SELLERS OR OTHERWISE CONSTITUTING A PORTION OF THE LP PROPERTIES, OR (I) ANY PORTION OF THE LP PROPERTIES.  ANY DATA, INFORMATION, OR OTHER RECORDS FURNISHED BY LP SELLERS ARE PROVIDED TO BUYER AS A CONVENIENCE AND BUYER’S RELIANCE ON OR USE OF THE SAME IS AT BUYER’S SOLE RISK.

Section 4.3.            LP Sellers’ Disclosure Schedule.   The matters set forth on the LP Sellers Disclosure Schedule are not necessarily matters that LP Sellers are required to disclose or matter that would constitute a breach of any representation or warranty had such matters not been disclosed.

ARTICLE V
Representations and Warranties of Buyer

Section 5.1.            Organization and Existence .  Buyer is a corporation, duly organized, legally existing and in good standing under the laws of the State of Delaware, and is qualified to do business and in good standing in each of the states in which LP Oil and Gas Properties are located where the laws of such state would require a corporation owning the LP Oil and Gas Properties located in such state to so qualify.  Buyer is also qualified to own and operate oil and gas properties with all applicable governmental agencies having jurisdiction over the LP Properties, to the extent such qualification is necessary or appropriate or will be necessary or appropriate upon consummation of the transactions contemplated hereby.

Section 5.2.            Power and Authority .  Buyer has full corporate power and authority to execute, deliver, and perform this Agreement and each other agreement, instrument, or document executed or to be executed by Buyer in connection with the transactions contemplated hereby to which it is a party and to consummate the transactions contemplated hereby and thereby.  The execution, delivery, and performance by Buyer of this Agreement and each other agreement, instrument, or document executed or to be executed by Buyer in connection with the transactions contemplated hereby to which it is a party, and the consummation by it of the transactions contemplated hereby and thereby, have been duly authorized by all necessary corporate action of Buyer.

Section 5.3.            Valid and Binding Agreement .  This Agreement has been duly executed and delivered by Buyer and constitutes, and each other agreement, instrument, or document executed or to be executed by Buyer in connection with the transactions contemplated hereby to which it is a party has been, or when executed will be, duly executed and delivered by Buyer and constitutes, or when executed and delivered will constitute, a valid and legally binding obligation of Buyer, enforceable against it in accordance with their respective terms, except that such

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enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors’ rights generally, and (b) equitable principles which may limit the availability of certain equitable remedies (such as specific performance) in certain instances.

Section 5.4.            Non-Contravention .  Neither the execution, delivery, and performance by Buyer of this Agreement and each other agreement, instrument, or document executed or to Buyer’s Knowledge to be executed by Buyer in connection with the transactions contemplated hereby to which it is a party and the consummation by it of the transactions contemplated hereby and thereby do not and will not (i) conflict with or result in a violation of Buyer’s Governing Documents, (ii) conflict with or result in a violation of any provision of, or constitute (with or without the giving of notice or the passage of time or both) a default under, or give rise (with or without the giving of notice or the passage of time or both) to any right of termination, cancellation, or acceleration under, any bond, debenture, note, mortgage, indenture, or any material lease, contract, agreement, or other instrument or obligation to which Buyer is a party or by which Buyer or any of its properties may be bound, (iii) result in the creation or imposition of any lien or other encumbrance upon the properties of Buyer, or (iv) violate any Applicable Law binding upon Buyer, except, in the instance of clauses (ii) and (iii) above, for which any such conflicts, violations, defaults, terminations, cancellations or accelerations which would not, individually or in the aggregate, have a Material Adverse Effect.

Section 5.5.            Approvals .  Other than requirements (if any) that there be obtained consents to assignment (or waivers of preferential rights to purchase) from third parties, no consent, approval, order, or authorization of, or declaration, filing, or registration with, any court or governmental agency or of any third party is required to be obtained or made by Buyer in connection with the execution, delivery, or performance by Buyer of this Agreement and each other agreement, instrument, or document executed or to be executed by Buyer in connection with the transactions contemplated hereby to which it is a party or the consummation by it of the transactions contemplated hereby and thereby, except, for such consents, approvals, orders, authorizations, declarations, filings, or registrations which, if not obtained or made (as applicable), would not, individually or in the aggregate, have a Material Adverse Effect.

Section 5.6.            Pending Litigation .  There are no Proceedings pending or, to Buyer’s Knowledge, threatened against or affecting the execution and delivery of this Agreement by Buyer or the consummation of the transactions contemplated hereby by Buyer.

Section 5.7.            Knowledgeable Purchaser .  Buyer is a knowledgeable purchaser, owner and operator of oil and gas properties, has the ability to evaluate (and in fact has evaluated) the LP Properties for purchase.  Buyer is an “accredited investor,” as defined in Regulation D promulgated pursuant to the Securities Act, and is acquiring the LP Properties for its own account and not with the intent to make a distribution within the meaning of the Securities Act  (and the rules and regulations pertaining thereto) or a distribution thereof in violation of any other applicable securities laws.  At LP Closing, Buyer will have had access to the LP Properties, the officers and consultants of LP Sellers, and the books, records, and files of LP Sellers relating to the LP Properties.  In making the decision to enter into this Agreement and to consummate the transactions contemplated hereby, Buyer has relied on its own independent due diligence investigation of the LP Properties and has been advised by and has relied solely on its own

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expertise and legal, land, tax, reservoir engineering, and other professional counsel concerning this transaction, the LP Properties and the value thereof.

Section 5.8.            Funds .  Buyer has, and at the LP Closing will have, sufficient cash and other sources of immediately available funds, as are necessary in order to pay the Adjusted Purchase Price to LP Sellers at the LP Closing and otherwise consummate the transactions contemplated hereby.

Section 5.9.            Fees and Commissions .  No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Buyer.

ARTICLE VI
Certain Covenants of LP Sellers Pending LP Closing

Section 6.1.            Access to Files .  Subject to the terms of the Confidentiality Agreement and Article IX , from the date hereof until the LP Closing Date, LP Sellers will give Buyer, and its attorneys and other authorized representatives, access at all reasonable times and in a manner so as to not interfere with the normal business operations of the LP Sellers to the LP Properties and to any contract files, lease or other title files, production files, well files, and other files of LP Sellers pertaining to the ownership or operation of the LP Properties, and LP Sellers will use their Reasonable Best Efforts to arrange for Buyer, and its attorneys and other representatives, to have access to any such files in the office of LP Sellers.

Section 6.2.            Conduct of Operations .  From the date hereof until the LP Closing Date, LP Sellers will (i) continue the routine operation of the LP Properties in the ordinary course of business as previously conducted prior to the date of this Agreement, including without limitation, the continuation of the drilling of new wells in accordance with the 2008 Appalachia Drilling Plan, a copy of which has been previously furnished to Buyer by LP Sellers; and (ii) operate the LP Properties in material compliance with all Applicable Laws and Environmental Laws and Material Agreements.  Without expanding any obligations that LP Sellers may have to Buyer, it is expressly agreed that LP Sellers shall never have any liability to Buyer which respect to operation of an LP Property 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).

Section 6.3.            Restrictions on Certain Actions .  From the date hereof until the LP Closing Date, LP Sellers will not, without Buyer’s prior consent in connection with the LP Properties:

(a)            expend any funds, or make any commitments to expend funds (including entering into new agreements which would obligate LP Sellers to expend funds), or otherwise incur any other obligations or liabilities, other than to pay expenses or to incur liabilities in the ordinary course of business as previously conducted prior to the date of this Agreement in connection with operation of the LP Properties after the Effective Date and as set out in the 2008 Appalachia Drilling Plan, a copy of which has been previously furnished to Buyer by LP Sellers, and except

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in the event of an emergency requiring immediate action to protect life or preserve the LP Properties;

(b)            except where necessary to prevent the termination of a Lease or other material agreement governing LP Sellers’ interest in the LP Properties, propose the drilling of any additional wells, or propose the deepening, plugging back or reworking of any existing wells, or propose the conducting of any other operations which require consent under the applicable operating agreement, or propose the conducting of any other operations other than the normal operation of the existing wells on the LP Oil and Gas Properties, or propose the abandonment of any wells on the LP Oil and Gas Properties (and LP Sellers agree that they will advise Buyer of any such proposals made by third parties and will respond to each such proposal made by a third party in the manner requested by Buyer);

(c)            sell, transfer, or abandon any portion of the LP Properties other than items of materials, supplies, machinery, equipment, improvements, or other personal property or fixtures forming a part of the LP Properties (and then only if the same is replaced with an item of substantially equal suitability, free of liens and security interests, which replacement item will then, for the purposes of this Agreement, become part of the LP Properties); or

(d)            release (or permit to terminate), or modify or reduce its rights under, any oil, gas, or mineral lease forming a part of the LP Oil and Gas Properties, or any Material Agreement, or modify any existing production sales contracts or enter into any new production sales contracts, except contracts terminable by LP Sellers with notice of 60 days or less.

Section 6.4.            Payment of Expenses .  LP Sellers will cause all expenses (including all bills for labor, materials, and supplies used or furnished for use in connection with the LP Properties and all severance, production, and similar Taxes) relating to the ownership or operation of the LP Properties prior to the LP Closing Date to be promptly paid and discharged, except for expenses disputed in good faith.

Section 6.5.            Preferential Rights and Third Party Consents .  LP Sellers will use Reasonable Best Efforts to request, from the appropriate parties (and in accordance with the documents creating such rights and/or requirements), waivers of the preferential rights to purchase, or requirements that consent to assignment be obtained, which are identified in Section 6.6 of the LP Sellers Disclosure Schedule.  LP Sellers shall have no obligation to assure that such waivers are obtained, and if all such waivers (or any other waivers of preferential rights to purchase or requirements that consent be obtained to assignment, even if the same are not listed on such Section 6.6) are not obtained, Buyer may not refuse to close the transaction contemplated by this Agreement; provided, however, that if the unobtained waiver is a waiver of a preferential right to purchase, and if both Buyer and LP Sellers agree to this treatment of such matter (and agree upon an appropriate allocation of the Purchase Price), LP Sellers will tender (at the agreed allocated portion of the Purchase Price) the required interest in the LP Property affected by such unwaived preferential right to purchase to the holder, or holders, of such right who have elected not to waive such preferential right to purchase, and if, and to the extent that, such preferential right to purchase is exercised by such party or parties, such interest in such LP Property will be excluded from the transaction contemplated hereby and the Purchase Price will

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be reduced by the amount paid, or to be paid, by the party exercising such preferential right to purchase (and LP Sellers shall collect such amount from such purchaser).

ARTICLE VII
Additional Pre-LP Closing and Post-LP Closing Agreements of Both Parties

Section 7.1.            Reasonable Best Efforts .  Each party hereto agrees that it will not voluntarily undertake any course of action inconsistent with the provisions or intent of this Agreement and will use its Reasonable Best Efforts to take, or cause to be taken, all action and to do, or cause to be done, all things reasonably necessary, proper, or advisable under Applicable Laws to consummate the transactions contemplated by this Agreement, including (i) cooperation in determining whether any consents, approvals, orders, authorizations, waivers, declarations, filings, or registrations of or with any Governmental Entity or third party are required in connection with the consummation of the transactions contemplated hereby; (ii) Reasonable Best Efforts to obtain any such consents approvals, orders, authorizations, and waivers and to effect any such declarations, filings, and registrations; (iii) Reasonable Best Efforts to cause to be lifted or rescinded any injunction or restraining order or other order adversely affecting the ability of the parties to consummate the transactions contemplated hereby; (iv) Reasonable Best Efforts to defend, and cooperation in defending, all Proceedings challenging this Agreement or the consummation of the transactions contemplated hereby; and (v) the execution of any additional instruments necessary to consummate the transactions contemplated hereby.

Section 7.2.            Notice of Litigation .  Until the LP Closing, (i) Buyer, upon learning of the same, shall promptly notify LP Sellers of any Proceeding which is commenced or threatened against Buyer and which affects this Agreement or the transactions contemplated hereby, and (ii)  LP Sellers, upon learning of the same, shall promptly notify Buyer of any Proceeding which is commenced or threatened against LP Sellers which affects this Agreement or the transactions contemplated hereby.

Section 7.3.            Notification of Certain Matters .  Until the LP Closing, LP Sellers shall give prompt notice to Buyer of any failure of LP Sellers to comply with or satisfy any covenant, condition, or agreement to be complied with or satisfied by LP Sellers hereunder prior to LP Closing.  Until the LP Closing, Buyer shall give prompt notice to LP Sellers of:  (i) the occurrence or nonoccurrence of any event the occurrence or nonoccurrence of which, to Buyer’s Knowledge, would be likely to cause any representation or warranty contained in Article V to be untrue or inaccurate at or prior to the LP Closing, and (ii) any failure of Buyer to comply with or satisfy any covenant, condition, or agreement to be complied with or satisfied by Buyer hereunder prior to LP Closing.  The delivery of any notice pursuant to this Section 7.3 shall not be deemed to (x) modify the representations or warranties hereunder of Buyer , (y) modify the conditions set forth in Article IX , or (z) limit or otherwise affect the remedies available hereunder to the party receiving such notice.

Section 7.4.            Fees and Expenses .

(a)            Except as otherwise provided herein, (i) all fees and expenses incurred in connection with this Agreement by LP Sellers will be borne by and paid by LP Sellers, and

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(ii) all fees and expenses incurred in connection with this Agreement by Buyer will be borne by and paid by Buyer.

(b)            All required documentary, filing and recording fees and expenses in connection with the filing and recording of the Assignment and other instruments required to convey title to the LP Properties to Buyer shall be borne by Buyer.  Buyer shall assume responsibility for, and shall bear and pay, any applicable state sales and use Taxes (including any applicable interest or penalties) incurred or imposed with respect to the transactions contemplated by this Agreement.

Section 7.5.            Public Announcements .  Except as may be required by Applicable Law, neither Buyer nor LP Sellers shall issue any press release or otherwise make any statement to the public generally with respect to this Agreement or the transactions contemplated hereby without the prior consent of the other party (which consent shall not be unreasonably withheld and which consent, if given verbally, shall be confirmed in writing within one Business Day thereafter).  Any such press release or statement required by Applicable Law shall only be made after reasonable notice to the other parties.

Section 7.6.            Casualty Loss Prior to LP Closing .  In the event of damage by fire or other casualty to any of the LP Properties after the Effective Date and prior to the LP Closing, then this Agreement shall remain in full force and effect, and (unless Buyer and LP Sellers shall otherwise agree) in such event:

(a)            as to each such LP Property so damaged which is an LP Oil and Gas Property, then, at LP Sellers’ election, either (i) such LP Property shall be treated as if it had an asserted Environmental Defect associated with it and the procedure provided for in Article VIII shall be applicable thereto, or (ii) the Purchase Price will not be adjusted, and if LP Sellers should be entitled to make any claims under any insurance policy with respect to such damage, LP Sellers shall, at LP Sellers’ election, either collect (and when collected pay over to Buyer), or assign to Buyer, such claims, and

(b)            as to each such LP Property which is other than an LP Oil and Gas Property, LP Sellers shall, at LP Sellers’ election, either collect (and when collected pay over to Buyer), or assign to Buyer, any and all insurance claims relating to such loss, and Buyer shall take title to the LP Property affected by such loss without reduction of the Purchase Price.

Section 7.7.            Governmental Bonds .  At or prior to LP Closing, Buyer shall deliver to LP Sellers evidence that Buyer has completed all action necessary to permit Buyer to post bonds or other security immediately following the LP Closing with all applicable Governmental Entities meeting the requirements of such Governmental Entities to own, and where appropriate, operate, the LP Properties.

Section 7.8.            Assumed Obligations .  At LP Closing, Buyer shall assume and agree to pay, perform and discharge the Assumed Obligations.

Section 7.9.            Operational Transition .  IT IS RECOGNIZED THAT THERE IS NO ASSURANCE GIVEN BY LP SELLERS THAT BUYER SHALL SUCCEED LP SELLERS AS OPERATOR OF ANY LP PROPERTY WHERE OTHER PARTIES OWN INTERESTS IN THE WELLS LOCATED THEREON, but LP Sellers shall cooperate with Buyer to see that

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Buyer shall succeed LP Sellers as operator of all the LP Sellers operated properties, by: (a) delivering at LP Closing signed counterparts of letters addressed to non-operating working interest owners of the LP Sellers operated LP Properties advising them of the sale of those LP Properties by LP Sellers to Buyer; and seeking such owners’ consideration of Buyer’s selection as successor to LP Seller as operator, and (b) executing applicable change of operator forms for filing with the applicable Governmental Agencies.

Section 7.10.         Books and Records .  At or promptly after LP Closing, but in no event later than 30 days after the LP Closing, LP Sellers will deliver to Buyer all related books and records that are a part of the LP Properties to a location designated by Buyer.  Buyer will promptly reimburse LP Sellers for all reasonable costs of shipping or transporting such books and records including any costs incurred to provide such data in an electronic format.  LP Sellers (or its Affiliates) shall have the right to have reasonable access during Buyer’s reasonable and customary business hours to inspect and copy (at LP Sellers’ or such Affiliate’s expense) the books and records so delivered under this Section 7.10 for the six-year period commencing on the LP Closing Date.

Section 7.11.         Suspended Funds .  As soon as practicable after the LP Closing Date, but no later than 90 days thereafter, LP Sellers shall provide to Buyer a listing in Excel spreadsheet format, showing all proceeds from production attributable to the wells which are currently held in suspense by LP Sellers and the reason for suspending such proceeds, shall transfer to Buyer all those suspended proceeds (the “ Suspended Proceeds ”).  Thereafter, Buyer shall be responsible for proper distribution of the Suspended Proceeds to the parties lawfully entitled to them to the extent and only to the extend of Suspended Proceeds, except LP Sellers shall remain liable for interest and penalties, if any, associated with the Suspended Proceeds for failure, prior to the LP Closing Date, to escheat such Suspended Proceeds to the applicable Governmental Entities in accordance with Applicable Law.

Section 7.12.         Letters-in-Lieu .  At the LP Closing, LP Sellers shall execute and deliver letters in lieu of transfer orders (or similar documentation) in form reasonably acceptable to Buyer and LP Sellers.

Section 7.13.         Logos and Names .  As soon as practicable after the LP Closing, Buyer will remove or cause to be removed the names and marks used by LP Sellers and all variations and derivatives thereof and logos relating thereto from the LP Properties.

Section 7.14.         Further Assurances .  At the LP Closing, and from time to time following the LP Closing, at the request of any party hereto and without further consideration, the other party or parties hereto shall execute and deliver to such requesting party such instruments and documents and take such other action (but without incurring any material financial obligation) as such requesting party may reasonably request in order to consummate more fully and effectively the transactions contemplated hereby.

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ARTICLE VIII
Due Diligence Examination

Section 8.1.            Title Due Diligence Examination .

From the date of this Agreement until 5:00 p.m. (local time in Houston, Texas) seven Business Days prior to the LP Closing Date (the “ Examination Period ”), LP Sellers shall afford to Buyer and its authorized representatives reasonable access during normal business hours and in a manner so as to not unduly interfere with the normal business operations of the LP Sellers to the office, personnel and books and records of LP Sellers in order for Buyer to conduct a title examination as it may in its sole discretion choose to conduct with respect to the LP Oil and Gas Properties.  Such books and records shall include all title opinions, title files, ownership maps, lease files, assignments, division orders, operating records and agreements, well files, financial and accounting records, geological, geophysical and engineering records, in each case insofar as same may now be in existence and in the possession of LP Sellers, excluding, however, any information that LP Sellers are prohibited from disclosing by bona fide, third party confidentiality restrictions; provided, that if requested by Buyer, LP Sellers shall use their Reasonable Best Efforts to obtain a waiver of any such restrictions in favor of Buyer.  The cost and expense of buyer’s title review, if any, shall be borne solely by Buyer.

Section 8.2.            Environmental Due Diligence Examination .

(a)            During the Examination Period, Buyer shall have the right, or the right to cause an environmental consultant reasonably acceptable to LP Sellers (“ Buyer’s Environmental Consultant ”), to conduct a Phase I environmental assessment of the LP Properties an