Common use of Consideration and Purchase Price Allocation Clause in Contracts

Consideration and Purchase Price Allocation. The preliminary allocation of the total purchase price in the Stronghold Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets to be acquired and liabilities to be assumed as of the closing date of the transaction using currently available information and market data as of August 31, 2022. Because the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final purchase price allocation and the resulting effect on financial position and results of operations may differ significantly from the pro forma amounts included herein. The preliminary purchase price allocation is subject to change due to several factors, including but not limited to changes in the estimated fair value of assets acquired and liabilities assumed as of the closing date of the transaction, which could result from changes in future oil and natural gas commodity prices, reserve estimates, interest rates, as well as other factors. The consideration transferred and the fair value of assets acquired and liabilities assumed by Ring are as follows (in thousands, except share amounts and stock price): Consideration: Shares of Ring Common Stock issued 21,339,986 Ring Common Stock price as of August 31, 2022 $ 3.24 Common Stock Consideration $ 69,142 Shares of Ring Preferred Stock issued 153,176 Aggregate Liquidation Preference $ 153,176 Conversion Price $ 3.60 As-Converted Shares of Ring Common Stock 42,548,903 Ring Common Stock Price as of August 31, 2022 $ 3.24 Preferred Stock Consideration $ 137,858 Cash consideration 167,944 Fair value of deferred payment liability 14,417 Fair value of consideration to be paid to seller 389,361 Direct transaction costs 10,315 Total consideration $ 399,676 Fair value of assets acquired: Oil and natural gas properties 446,105 Amount attributable to assets acquired $ 446,105 Fair value of liabilities assumed: Suspense liability 1,652 Derivative liabilities 26,409 Asset retirement obligations 9,731 Deferred income taxes 8,637 Amount attributable to liabilities assumed $ 46,429 The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair value of oil and gas properties and asset retirement obligations were measured using the discounted cash flow technique of valuation. Significant unobservable inputs included future commodity prices adjusted for differentials, projections of estimated quantities of recoverable reserves, forecasted production based on decline curve analysis, estimated timing and amount of future operating and development costs, and a weighted average cost of capital.

Consideration and Purchase Price Allocation. The preliminary allocation of the total purchase price in the Stronghold Driftwood Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets to be acquired and liabilities to be assumed as of the closing date of the transaction using currently available information and market data as of August 31, 2022data. Because the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final purchase price allocation and the resulting effect on financial position and results of operations may differ significantly from the pro forma amounts included herein. The preliminary purchase price allocation is subject to change due to several factors, including but not limited to changes in the estimated fair value of assets acquired and liabilities assumed as of the closing date of the transaction, which could result from changes in future oil and natural gas commodity prices, reserve estimates, interest rates, as well as other factors. Vital Energy, Inc. Notes to unaudited pro forma condensed combined financial information The consideration transferred and the relative fair value of assets acquired and liabilities assumed by Ring Vital are as follows (in thousands, except share amounts and share stock price): Consideration: Cash consideration $ 127,647 Closing adjustments (7,280) Total cash consideration $ 120,367 Shares of Ring Common Stock Vital common stock issued 21,339,986 Ring Common Stock 1,578,948 Vital common stock price as of August 31April 3, 2022 2023 $ 3.24 Common Stock Consideration 50.71 Total share consideration $ 69,142 Shares of Ring Preferred Stock issued 153,176 Aggregate Liquidation Preference $ 153,176 Conversion Price $ 3.60 As-Converted Shares of Ring Common Stock 42,548,903 Ring Common Stock Price as of August 31, 2022 $ 3.24 Preferred Stock Consideration $ 137,858 Cash consideration 167,944 Fair value of deferred payment liability 14,417 Fair value of consideration to be paid to seller 389,361 80,068 Direct transaction costs 10,315 3,999 Total consideration $ 399,676 Fair 204,434 Relative fair value of assets acquired: Oil and natural gas properties 446,105 210,204 Amount attributable to assets acquired $ 446,105 210,204 Fair value of liabilities assumed: Suspense liability 1,652 Derivative liabilities 26,409 4,277 Asset retirement obligations 9,731 Deferred income taxes 8,637 1,020 Undistributed revenue and royalties 473 Amount attributable to liabilities assumed $ 46,429 5,770 The fair value measurements of assets acquired and liabilities assumed excluding derivatives are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair value measurements of derivative liabilities assumed are based quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the assets or liabilities and as such, represent Level 2 inputs. The fair value of oil and gas properties and asset retirement obligations were measured using the discounted cash flow technique of valuation. Significant unobservable inputs included future commodity prices adjusted for differentials, projections of estimated quantities of recoverable reserves, forecasted production based on decline curve analysis, estimated timing and amount of future operating and development costs, and a weighted average cost of capital.

Consideration and Purchase Price Allocation. The preliminary allocation of the total purchase price in the Stronghold PEP Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets to be acquired and liabilities to be assumed as of the closing date of the transaction using currently available information and market data as of August 31, 2022data. Because the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final purchase price allocation and the resulting effect on financial position and results of operations may differ significantly from the pro forma amounts included herein. The preliminary purchase price allocation is subject to change due to several factors, including but not limited to changes in the estimated fair value of assets acquired and liabilities assumed as of the closing date of the transaction, which could result from changes in future oil and natural gas commodity prices, reserve estimates, interest rates, as well as other factors. Vital Energy, Inc. Notes to unaudited pro forma condensed combined financial information The consideration transferred and the relative fair value of assets acquired and liabilities assumed by Ring Vital are as follows (in thousands, except share amounts and share stock price): Consideration: Shares of Ring Common Stock Vital common stock issued 21,339,986 Ring Common Stock 878,690 Vital common stock price as of August 31February 2, 2022 2024 $ 3.24 42.17 Common Stock Consideration stock consideration $ 69,142 37,054 Shares of Ring Vital preferred stock issued 980,272 Vital preferred stock price as of February 2, 2024 $ 42.17 Preferred Stock issued 153,176 Aggregate Liquidation Preference consideration $ 153,176 Conversion Price $ 3.60 As-Converted Shares of Ring Common Stock 42,548,903 Ring Common Stock Price as of August 31, 2022 $ 3.24 Preferred Stock Consideration $ 137,858 Cash consideration 167,944 41,338 Fair value of deferred payment liability 14,417 Preferred Stock dividends 346 Fair value Value of consideration to be paid to seller 389,361 Preferred Stock 41,684 Direct transaction costs 10,315 1,000 Total consideration $ 399,676 Fair 79,738 Relative fair value of assets acquired: Oil and natural gas properties 446,105 79,738 Amount attributable to assets acquired $ 446,105 Fair value of liabilities assumed: Suspense liability 1,652 Derivative liabilities 26,409 Asset retirement obligations 9,731 Deferred income taxes 8,637 Amount attributable to liabilities assumed $ 46,429 79,738 The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair value of oil and natural gas properties and asset retirement obligations were measured using the discounted cash flow technique of valuation. Significant unobservable inputs included future commodity prices adjusted for differentials, projections of estimated quantities of recoverable reserves, forecasted production based on decline curve analysis, estimated timing and amount of future operating and development costs, and a weighted average cost of capital.

Consideration and Purchase Price Allocation. The preliminary allocation of the total purchase price in the Stronghold Forge Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets to be acquired and liabilities to be assumed as of the closing date of the transaction using currently available information and market data as of August 31, 2022data. Because the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final purchase price allocation and the resulting effect on financial position and results of operations may differ significantly from the pro forma amounts included herein. The preliminary purchase price allocation is subject to change due to several factors, including but not limited to changes in the estimated fair value of assets acquired and liabilities assumed as of the closing date of the transaction, which could result from changes in future oil and natural gas commodity prices, reserve estimates, interest rates, as well as other factors. The consideration transferred and the relative fair value of assets acquired and liabilities assumed by Ring Vital are as follows (in thousands, except share amounts and share stock price): Consideration: Shares of Ring Common Stock issued 21,339,986 Ring Common Stock price as of August 31, 2022 $ 3.24 Common Stock Consideration $ 69,142 Shares of Ring Preferred Stock issued 153,176 Aggregate Liquidation Preference $ 153,176 Conversion Price $ 3.60 As-Converted Shares of Ring Common Stock 42,548,903 Ring Common Stock Price as of August 31, 2022 $ 3.24 Preferred Stock Consideration $ 137,858 Cash consideration 167,944 Fair value of deferred payment liability 14,417 Fair value of $ 378,000 Closing adjustments 13,586 Total cash consideration to be paid to seller 389,361 $ 391,586 Direct transaction costs 10,315 5,656 Total consideration Consideration $ 399,676 Fair 397,242 Relative fair value of assets acquired: Oil and natural gas properties: Evaluated properties 446,105 – full cost method 249,831 Unevaluated properties not being depleted – full cost method 153,110 Amount attributable to assets acquired $ 446,105 402,941 Fair value of liabilities assumed: Suspense liability 1,652 Derivative liabilities 26,409 Asset retirement obligations 9,731 Deferred income taxes 8,637 1,376 Undistributed revenue and royalties 4,323 Amount attributable to liabilities assumed $ 46,429 5,699 The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair value of oil and natural gas properties and asset retirement obligations were measured using the discounted cash flow technique of valuation. Significant unobservable inputs included future commodity prices adjusted for differentials, projections of estimated quantities of recoverable reserves, forecasted production based on decline curve analysis, estimated timing and amount of future operating and development costs, and a weighted average cost of capital.