Execution Version
 
STOCK PURCHASE AGREEMENT
 
STOCK PURCHASE AGREEMENT (the “Agreement”), dated as of November 3, 2010, by and
among Hyperdynamics Corporation, a corporation organized under the laws of the
State of Delaware, with its principal offices at 12012 Wickchester Lane, Suite
475, Houston, Texas 77079 (the “Company”), and the investors listed on the
Schedule of Buyers attached hereto (each, a “Buyer,” and collectively, the
“Buyers”).
 
WHEREAS:
 
A.    The Company and each Buyer is executing and delivering this Agreement in
reliance upon the exemption from securities registration afforded by Section
4(2) of the Securities Act of 1933, as amended (the “1933 Act”), and/or Rule 506
of Regulation D (“Regulation D”) as promulgated by the United States Securities
and Exchange Commission (the “SEC”) under the 1933 Act.
 
B.    Each Buyer wishes to purchase, and the Company wishes to sell, upon the
terms and conditions stated in this Agreement, that aggregate number of shares
of the common stock, par value $0.001 per share, of the Company (the “Common
Stock”), set forth opposite such Buyer’s name in column (3) on the Schedule of
Buyers (which aggregate amount for all Buyers together shall be 15,000,000
shares of Common Stock and shall collectively be referred to herein as the
“Common Shares”).
 
C.    Contemporaneously with the execution and delivery of this Agreement, the
parties hereto are executing and delivering a Registration Rights Agreement,
substantially in the form attached hereto as Exhibit A (the “Registration Rights
Agreement”), pursuant to which the Company has agreed to provide certain
registration rights with respect to the Common Shares under the 1933 Act and the
rules and regulations promulgated thereunder, and applicable state securities
laws.
 
NOW, THEREFORE, the Company and each Buyer hereby agree as follows:
 
 
1.
PURCHASE AND SALE OF COMMON SHARES

 
(a)           Purchase of Common Shares.
 
Subject to the satisfaction (or waiver) of the conditions set forth in Sections
5 and 6 below, the Company shall issue and sell to each Buyer, and each Buyer
severally, but not jointly, shall purchase from the Company on the Closing Date
(as defined below), the number of Common Shares as is set forth opposite such
Buyer’s name in column (3) on the Schedule of Buyers (the “Closing”).
 
(i)           Closing.  The date and time of the Closing (the “Closing Date”)
shall be 10:00 a.m., Houston, Texas time, on the date hereof (or such later date
as is mutually agreed to by the Company and each Buyer) after notification of
satisfaction (or waiver) of the conditions to the Closing set forth in Sections
5 and 6 below at the offices of the Company or at such other location as
mutually agreed upon by the parties hereto.
 
 
 

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(ii)           Purchase Price.  The aggregate purchase price for the Common
Shares to be purchased by each such Buyer at the Closing (the “Purchase Price”)
shall be the amount set forth opposite each Buyer’s name in column (4) of the
Schedule of Buyers.
 
(b)           Form of Payment.  On the Closing Date, (i) each Buyer shall pay
its Purchase Price to the Company for the Common Shares to be issued and sold to
such Buyer at the Closing, by wire transfer of immediately available funds in
accordance with the Company’s written wire instructions and (ii) the Company
shall deliver to each Buyer the Common Shares (allocated in the amounts as such
Buyer shall request) which such Buyer is then purchasing hereunder, duly
executed on behalf of the Company and registered in the name of such Buyer or
its designee.
 
 
2.
BUYER’S REPRESENTATIONS AND WARRANTIES.

 
Each Buyer represents and warrants with respect to only itself that:
 
(a)           No Public Sale or Distribution.  Such Buyer is acquiring the
Common Shares for its own account and not with a view towards, or for resale in
connection with, the public sale or distribution thereof, and that such Buyer
has no present intention of selling, granting any participation in or otherwise
distributing the same except pursuant to sales registered or exempted under the
1933 Act; provided, however, that by making the representations herein, such
Buyer does not agree to hold any of the Common Shares for any minimum or other
specific term and reserves the right to dispose of the Common Shares at any time
in accordance with or pursuant to a registration statement or an exemption under
the 1933 Act and pursuant to the applicable terms of the Transaction Documents
(as defined in Section 3(b)), except as provided in Section 2(m).  Such Buyer is
acquiring the Common Shares hereunder in the ordinary course of its
business.  Such Buyer does not presently have any agreement, contract,
undertaking, arrangement or understanding, directly or indirectly, with any
Person (as defined in Section 3(s)) to distribute any of the Common Shares.
 
(b)           Accredited Investor Status.  Such Buyer is an “accredited
investor” as that term is defined in Rule 501(a) of Regulation D and that such
Buyer shall submit to the Company such additional information as may be
reasonably requested by the Company to establish such Buyer’s status as such.
 
(c)           Reliance on Exemptions.  Such Buyer understands that the Common
Shares are being offered and sold to it in reliance on specific exemptions from
the registration requirements of United States federal and state securities laws
and that the Company is relying in part upon the truth and accuracy of, and such
Buyer’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of such Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of such Buyer
to acquire the Common Shares.
 
 
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(d)           Information.  Such Buyer and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Common Shares
that have been requested by such Buyer.  Such Buyer and its advisors, if any,
have been afforded the opportunity to ask questions of the Company concerning
the Transaction Documents, the exhibits and schedules attached thereto and the
transactions contemplated by the Transaction Documents, as well as the Company’s
business, management and financial affairs, which questions were answered to its
complete satisfaction.  Neither such inquiries nor any other due diligence
investigations conducted by such Buyer or its advisors, if any, or its
representatives shall modify, amend or affect such Buyer’s right to rely on the
Company’s representations and warranties contained herein.  Such Buyer
understands that its investment in the Common Shares involves a high degree of
risk and acknowledges that it is able to afford a complete loss of such
investment.  Such Buyer has sought such accounting, legal and tax advice as it
has considered necessary to make an informed investment decision with respect to
its acquisition of the Common Shares.
 
(e)           No Governmental Review.  Such Buyer understands that no United
States federal or state agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Common Shares or
the fairness or suitability of the investment in the Common Shares nor have such
authorities passed upon or endorsed the merits of the offering of the Common
Shares.
 
(f)           Transfer or Resale.  Such Buyer understands that except as
provided in the Registration Rights Agreement: (i) the Common Shares have not
been and are not being registered under the 1933 Act or any state securities
laws, and may not be offered for sale, sold, assigned or transferred unless (A)
subsequently registered thereunder, or (B) such Buyer shall have delivered to
the Company an opinion of counsel, in a form reasonably acceptable to the
Company and its legal counsel, to the effect that such Common Shares to be sold,
assigned or transferred may be sold, assigned or transferred pursuant to an
exemption from such registration, including, without limitation, the exemptions
provided by Rule 144 or Rule 144A promulgated under the 1933 Act (or a successor
rule thereto) (collectively, “Rule 144”); (ii) any sale of the Common Shares
made in reliance on Rule 144 may be made only in accordance with the terms of
Rule 144 and further, if Rule 144 is not applicable, any resale of the Common
Shares under circumstances in which the seller (or the Person through whom the
sale is made) may be deemed to be an underwriter (as that term is defined in the
1933 Act) may require compliance with some other exemption under the 1933 Act or
the rules and regulations of the SEC thereunder; and (iii) neither the Company
nor any other Person is under any obligation to register the Common Shares under
the 1933 Act or any state securities laws or to comply with the terms and
conditions of any exemption thereunder.
 
(g)           Legends.  Such Buyer understands that until such time as the
resale of the Common Shares have been registered under the 1933 Act as
contemplated by the Registration Rights Agreement, except as set forth below,
the certificates or other instruments representing the Common Shares, shall bear
any legend as required by the “blue sky” laws of any state and a restrictive
legend in substantially the following form (and a stop-transfer order may be
placed against transfer of such stock certificates):
 
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A
FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.
 
 
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The legend set forth above shall be removed and the Company shall issue a
certificate without such legend to the holder of the Common Shares upon which it
is stamped, if, unless otherwise required by state securities laws, (i) such
Common Shares are registered for resale under the 1933 Act, or (ii) in
connection with a sale, assignment or other transfer, such holder provides the
Company with an opinion of a law firm reasonably acceptable to the Company and
its legal counsel, in a form reasonably acceptable to the Company and its legal
counsel, to the effect that such sale, assignment or transfer of the Common
Shares may be made without registration under the applicable requirements of the
1933 Act including, without limitation, the exemption provided by Rule
144.  Notwithstanding the above, the Company shall issue a certificate without
such legend to the holder of the Common Shares upon which it is stamped upon the
request of such holder on or after the six month anniversary of the closing date
consistent with and pursuant to the requirements of Rule 144.
 
(h)          Validity; Enforcement.  This Agreement and the Registration Rights
Agreement have been duly and validly authorized, executed and delivered on
behalf of such Buyer and shall constitute the legal, valid and binding
obligations of such Buyer enforceable against such Buyer in accordance with
their respective terms, except as such enforceability may be limited by general
principles of equity or to applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation and other similar laws relating to, or affecting
generally, the enforcement of applicable creditors’ rights and remedies.
 
(i)           No Conflicts.  The execution, delivery and performance by such
Buyer of this Agreement and the Registration Rights Agreement and the
consummation by such Buyer of the transactions contemplated hereby and thereby
will not (i) result in a violation of the organizational documents of such
Buyer, (ii) conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which such Buyer is a party, (iii) result
in a violation of any law, rule, regulation, order, judgment  or decree
(including federal and state securities laws) applicable to such Buyer, or (iv)
require the consent, approval, authorization, order of or any filing,
registration or qualification with, any court, governmental authority or third
Person, except in the case of clauses (ii)  (iii) and (iv) above, for such
conflicts, defaults, rights or violations which would not, individually or in
the aggregate, reasonably be expected to have a material adverse effect on the
ability of such Buyer to perform its obligations hereunder.
 
(j)           Investment Risk.  Such Buyer understands that its investment in
the Common Shares involves a significant degree of risk and that the market
price of the Common Stock has been and continues to be volatile and that no
representation is being made as to the future value or trading volume of the
Common Shares.  Such Buyer has the knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Common Shares and has the ability to bear the economic risks
of an investment in the Common Shares.
 
 
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(k)           Residency.  Such Buyer is a resident of that jurisdiction
specified below its address on the Schedule of Buyers.
 
(l)           Organization; Authorization.  Such Buyer is duly organized,
validly existing and in good standing (to the extent such concept is applicable)
under the laws of the jurisdiction in which it is organized and has the
requisite organizational power and authority to carry on its business as now
being conducted.  Such Buyer has the requisite organizational power and
authority to enter into and perform its obligations under this Agreement and the
Transaction Documents to which it is a party.
 
(m)          Certain Trading Activities.  Neither such Buyer, nor any affiliate,
foreign or domestic, of Buyer, which (x) had knowledge of the transactions
contemplated hereby, (y) has or shares discretion relating to such Buyer’s
investments or trading or information concerning such Buyer’s investments and
(z) is subject to such Buyer’s review or input concerning such affiliate’s
investments or trading (collectively, "Trading Affiliates") has directly or
indirectly, nor has any Person acting on behalf of or pursuant to any
understanding with such Buyer or Trading Affiliate, engaged in any transactions
in the securities of the Company (including, without limitation, any Short Sales
(as defined below) involving the Company’s securities) since the date that such
Buyer was first contacted by the Company or any Person acting on their behalf
regarding the investment in the Company contemplated by this Agreement.  For
purposes of this Section, “Short Sales” include, without limitation, all “short
sales” as defined in Rule 200 of Regulation SHO adopted under the 1934 Act (as
defined in Section 3(f) below) and all types of direct and indirect stock
pledges, forward sale contracts, options, puts, calls, short sales, swaps and
similar arrangements (including on a total return basis), and sales and other
transactions through non-US broker-dealers or foreign regulated brokers having
the effect of hedging the securities of the Company or the investment
contemplated under this Agreement.  Such Buyer covenants that neither it, nor
any Person acting on its behalf or pursuant to any understanding with it, will
engage in any transactions in the securities of the Company (including Short
Sales) prior to the time that the transactions contemplated by this Agreement
are publicly disclosed by the Company by means of filing a Current Report on
Form 8-K.
 
(n)          [Intentionally Omitted.]
 
(o)          Rule 144.  Such Buyer acknowledges that the Common Shares must be
held unless subsequently registered under the 1933 Act or an exemption from such
registration is available.  Such Buyer is aware of the provisions of Rule 144
promulgated under the 1933 Act which permit limited resale of shares purchased
in a private placement subject to the satisfaction of certain conditions,
including among other things, the availability of certain current public
information about the Company, and, if applicable, the resale occurring not less
than six months after a party has purchased and paid for the security to be
sold.  Such Buyer understands that, although Rule 144 is not exclusive, the SEC
has expressed its opinion that Persons proposing to sell restricted securities
received in a private offering other than in a registered offering or pursuant
to Rule 144 will have a substantial burden of proof in establishing that an
exemption from registration is available for such offers or sales and that such
Persons and the brokers who participate in the transactions do so at their own
risk.
 
 
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(p)          Brokers or Finders.  The Company will not incur, directly or
indirectly, as a result of any action taken by such Buyer, any liability for
brokerage or finders’ fees or agents’ commissions or any similar charges in
connection with the Transaction Documents.
 
(q)          Tax Advisors.  Such Buyer has reviewed with its own tax advisors
the U.S. federal, state, local and foreign tax consequences of this investment
and the transactions contemplated by the Transaction Documents.  With respect to
such matters, such Buyer relies solely on such advisors and not on any
statements or representations of the Company or any of its agents, written or
oral.  With the exception that the Company shall be responsible for the taxes as
described in Section 3(dd) herein, such Buyer understands that it (and not the
Company) shall be responsible for its own tax liability that may arise as a
result of this investment or the transactions contemplated by the Transaction
Documents.
 
(r)           General Solicitation.  Such Buyer is not purchasing the Common
Shares as a result of any advertisement, article, notice or other communication
regarding the Common Shares published in any newspaper, magazine or similar
media or broadcast over television or radio or presented at any seminar or any
other general advertisement.
 
 
3.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

 
The Company represents and warrants to each of the Buyers that:
 
(a)           Organization and Qualification.  The Company has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the State of Delaware, with corporate power and authority to carry on
its business as now being conducted, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or
conducts its business in a manner or to an extent that would require such
qualification, other than such failures to be so qualified or in good standing
as, individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.  As used in this Agreement, “Material Adverse Effect”
means any material adverse effect on the business, properties, assets,
operations, results of operations, or condition (financial or otherwise) of the
Company and its Subsidiaries (as defined below), taken as a whole, or on the
transactions contemplated hereby and the other Transaction Documents or by the
agreements and instruments to be entered into in connection herewith or
therewith, or on the authority or ability of the Company to perform its
obligations under the Transaction Documents.  Each Subsidiary of the Company has
been duly organized and is validly existing as a corporation, partnership or
limited liability company in good standing under the laws of the jurisdiction in
which it is chartered or organized with full corporate power and authority to
own or lease, as the case may be, and to operate its properties and conduct its
business as currently operated and conducted, and is duly qualified to do
business as a foreign corporation, partnership or limited liability company and
is in good standing under the laws of each jurisdiction which requires such
qualification, except where the failure so to qualify or to be in good standing
would not, individually or in the aggregate, result in a Material Adverse
Effect.  As used herein, “Subsidiary” means (A) any entity of which the Company
(either alone or through or together with one or more of its Subsidiaries) owns
or holds, directly or indirectly, through one or more intermediaries, more than
50% of the stock or other equity interests of such entity and such entity is an
entity which is required to be disclosed in Exhibit 21 of the Company’s SEC
Documents (defined below) under Item 601 of Regulation S-K, (B) any entity of
which stock or other equity interests having the power to elect a majority of
that entity’s board of directors or similar governing body, or otherwise having
the power to direct the business and policies of such entity, are held or owned,
directly or indirectly, through one or more intermediaries, by the Company
(either alone or through or together with one or more of its Subsidiaries), or
(C) any entity, the operations of which are consolidated or combined with the
Company, pursuant to generally accepted accounting principles (“GAAP”), for
financial reporting purposes.
 
 
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(b)          Authorization; Enforcement; Validity.  The Company has the
requisite corporate power and authority to enter into and perform its
obligations under this Agreement, the Registration Rights Agreement, and each of
the other agreements entered into by the parties hereto in connection with the
transactions contemplated by this Agreement (collectively, the “Transaction
Documents”) and to issue the Common Shares in accordance with the terms hereof
and thereof.  The execution and delivery of the Transaction Documents by the
Company and the consummation by the Company of the transactions contemplated
hereby and thereby, including, without limitation, the issuance of the Common
Shares have been duly authorized by the Company’s Board of Directors and no
further consent or authorization is required by the Company, its Board of
Directors or its stockholders.  This Agreement and the other Transaction
Documents have been duly executed and delivered by the Company, and constitute
the legal, valid and binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance or transfer, reorganization,
moratorium and similar laws affecting creditors’ rights and remedies generally,
and to general principles of equity, including principles of materiality,
commercial reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity) and except that
rights to indemnification and contribution thereunder may be limited by federal
or state securities laws or public policy relating thereto.
 
(c)           Issuance of Common Shares.  The Common Shares are duly authorized
and, upon issuance in accordance with the terms hereof, shall be validly issued
and free from all preemptive or similar rights, taxes, liens and charges with
respect to the issuance thereof other than liens or encumberances created by or
imposed upon the Buyers; provided, however, that the Common Shares are subject
to restrictions on transfer under U.S. state and federal securities laws as
provided herein and in the Registration Rights Agreement, and the Common Shares
shall be fully paid and nonassessable with the holders being entitled to all
rights accorded to a holder of Common Stock.  Assuming the accuracy of each of
the representations and warranties set forth in Section 2 of this Agreement, the
offer and issuance by the Company of the Common Shares is exempt from
registration under the 1933 Act.
 
 
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(d)           No Conflicts.  The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby (including, without limitation, the
issuance of the Common Shares) and will not (i) result in a violation of the
Amended and Restated Certificate of Incorporation, as amended, or the By-laws of
the Company, or any certificate of incorporation, certificate of formation, any
certificate of designations, bylaws or other constituent documents of any of its
Subsidiaries, each as in effect on the date hereof, or any capital stock of the
Company or any of its Subsidiaries or (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) in any respect under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or any of its Subsidiaries is a party, except,
in each case, for such conflicts, defaults or events of default which would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect or (iii) except as would not reasonably be expected to result in
a Material Adverse Effect, result in a violation of any law, rule, regulation,
order, judgment or decree (including foreign, federal and state securities laws
and regulations and the rules and regulations of the NYSE Amex (the “Principal
Market”)) applicable to the Company or any of its Subsidiaries or by which any
property or asset of the Company or any of its Subsidiaries is bound or
affected.
 
(e)           Consents.  Except for (i) an additional listing application with
the Principal Market, (ii) the 8-K Filing (as defined in Section 4(h)), (iii)
the Registration Statement (as defined in the Registration Rights Agreement),
(iv) the reports or notices required under Regulation D and any related state
“Blue Sky” filings required to be filed with respect to the Common Shares
pursuant to the Registration Rights Agreement and (v) the receipt of a
declaration of the effectiveness of the Registration Statement, the Company is
not required to obtain any consent, authorization or order of, or make any
filing or registration with, any court, governmental agency or any regulatory or
self-regulatory agency or any other Person in order for it to execute, deliver
or perform any of its obligations under the Transaction Documents, in each case,
in accordance with the terms hereof or thereof.  The Company is unaware of any
facts or circumstances that might prevent the Company from obtaining or
effecting any of the registration, application or filings pursuant to the
preceding sentence required to be obtained or effected.  The Company is not in
violation of the listing requirements of the Principal Market and has no
knowledge of any facts that would reasonably lead to delisting or suspension of
the Common Stock in the foreseeable future.
 
(f)           Acknowledgment Regarding Buyer’s Purchase of Common Shares.  The
Company acknowledges and agrees that each Buyer is acting solely in the capacity
of an arm’s length purchaser with respect to the Transaction Documents and the
transactions contemplated hereby and thereby and that no Buyer is (i) an officer
or director of the Company, (ii) to the Company’s Knowledge, an “affiliate” of
the Company or any of its Subsidiaries (as defined in Rule 144 of the 1933 Act)
or (iii) to the Knowledge of the Company, based solely on a review of available
public filings on Schedule 13D or Schedule 13G and without taking into account
the purchase of the Common Shares hereunder by such Buyer, a “beneficial owner”
of more than 10% of the Common Stock (as defined for purposes of Rule 13d-3 of
the Securities Exchange Act of 1934, as amended (the “1934 Act”)).  The Company
further acknowledges that no Buyer is acting as a financial advisor or fiduciary
of the Company or any of its Subsidiaries (or in any similar capacity) with
respect to the Transaction Documents and the transactions contemplated hereby
and thereby, and any advice given by a Buyer or any of its representatives or
agents in connection with the Transaction Documents and the transactions
contemplated hereby and thereby is merely incidental to such Buyer’s purchase of
the Common Shares.  The Company further represents to each Buyer that the
Company’s decision to enter into the Transaction Documents has been based solely
on an independent evaluation by the Company and its representatives.  As used
herein, “Knowledge” means, with respect to the Company, the actual knowledge of
any executive officer of the Company.
 
 
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(g)           No General Solicitation; No Placement Agent.  Neither the Company,
nor any of its Subsidiaries or affiliates, nor any Person acting on its or their
behalf, has engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with the offer or sale of the
Common Shares.  Neither the Company nor any of its Subsidiaries has engaged any
placement agent or other agent in connection with the sale of the Common Shares.
 
(h)           No Integrated Offering.  None of the Company, its Subsidiaries,
any of their affiliates, and any Person acting on their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would require registration of the
issuance of any of the Common Shares under the 1933 Act, whether through
integration with prior offerings or otherwise, or cause this offering of the
Common Shares to require approval of stockholders of the Company for purposes of
any applicable stockholder approval provisions, including, without limitation,
under the rules and regulations of the Principal Market.  None of the Company,
its Subsidiaries, their affiliates and any Person acting on their behalf will
take any action or steps referred to in the preceding sentence that would
require registration of the issuance of any of the Common Shares under the 1933
Act or stockholder approval under applicable stockholder approval provisions.
 
(i)           SEC Documents; Financial Statements.  Since January 1, 2010, the
Company has filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements
of the 1934 Act (all of the foregoing, including all amendments thereto, filed
since January 1, 2010, and all exhibits included therein and financial
statements, notes and schedules thereto and documents incorporated by reference
therein being hereinafter referred to as the “SEC Documents”).  As of their
respective filing dates, the SEC Documents complied as to form in all material
respects with the requirements of the 1934 Act and the rules and regulations of
the SEC promulgated thereunder applicable to the SEC Documents, and the SEC
Documents, when taken together, at the time they were filed with the SEC, did
not contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.  As of their respective filing dates, the financial statements of
the Company included in the SEC Documents complied as to form in all material
respects with applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto.  Such financial statements have
been prepared in accordance with GAAP, consistently applied, during the periods
involved (except (i) as may be otherwise indicated in such financial statements
or the notes thereto and (ii) in the case of unaudited interim statements, to
the extent they may exclude footnotes, may be subject to customary year-end
adjustments or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments).
 
 
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(j)           Absence of Certain Changes.  Other than as set forth in the
Company’s SEC Documents, since June 30, 2010, there has been no material adverse
change and no material adverse development in the business, properties,
operations, condition (financial or otherwise) or results of operations of the
Company or its Subsidiaries.  Neither the Company nor any of its Subsidiaries
has taken any steps to seek protection pursuant to any bankruptcy law nor does
the Company have any knowledge or reason to believe that its creditors intend to
initiate involuntary bankruptcy proceedings or any actual knowledge of any fact
that would reasonably lead a creditor to do so.
 
(k)           No Undisclosed Events, Liabilities, Developments or
Circumstances.  Except for the offering and sale of the Common Shares, no event,
liability, development or circumstance has occurred or exists, or is
contemplated to occur, with respect to the Company or its Subsidiaries or their
respective business, properties, operations, condition (financial or otherwise)
or results of operations, that would be required to be disclosed by the Company
under applicable securities laws on a registration statement on Form S-1 filed
with the SEC relating to an issuance and sale by the Company of its Common Stock
and which has not been publicly announced.
 
(l)           Conduct of Business; Regulatory Compliance.  Neither the Company
nor any of its Subsidiaries is in violation of any judgment, decree or order or
any statute, ordinance, rule or regulation applicable to the Company or its
Subsidiaries, except for possible violations which could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse
Effect.  Without limiting the generality of the foregoing, the Company is not in
violation in any material respects of any of the rules, regulations or
requirements of the Principal Market and has no Knowledge of any facts or
circumstances that would reasonably lead to delisting or suspension of the
Common Stock by the Principal Market in the foreseeable future.
 
(m)          Foreign Corrupt Practices.  Neither the Company, nor any of its
Subsidiaries, nor, to the Knowledge of the Company, any director, officer,
agent, employee or other Person acting on behalf of the Company or any of its
Subsidiaries, has, in the course of its actions for, or on behalf of, the
Company, violated or is in violation of any provision of the U.S. Foreign
Corrupt Practices Act of 1977, as amended.
 
(n)           Sarbanes-Oxley Act.  The Company is in material compliance with
any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are
effective as of the date hereof that the Company is required to be in compliance
with, and any and all applicable rules and regulations promulgated by the SEC
thereunder that are effective as of the date hereof that the Company is required
to be in compliance with.
 
(o)           Transactions With Affiliates.  Except as set forth in the SEC
Documents filed at least ten days prior to the date hereof, none of the officers
or directors of the Company or any of its Subsidiaries is presently a party to
any transaction with the Company (other than for ordinary course services as
employees, officers or directors), which is, taken individually or in the
aggregate with other unreported transactions, material, including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any such officer, director or employee or, to the
Knowledge of the Company, any corporation, partnership, trust or other entity in
which any such officer, director, or employee has a substantial interest or is
an officer, director, trustee or partner.
 
 
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(p)           Equity Capitalization.  As of the date hereof, the authorized
capital stock of the Company consists of (x) 250,000,000 shares of Common Stock,
of which as of the date hereof, 109,031,661 shares are issued and outstanding,
9,500,000 shares are reserved for issuance pursuant to the Company’s equity
incentive plan of which options to purchase 7,570,000 shares of Common Stock are
outstanding and 6,017,052 shares are reserved for issuance pursuant to
securities exercisable or exchangeable for, or convertible into, shares of
Common Stock, and (y) 20,000,000 shares of preferred stock, $0.001 par value per
share, of which as of the date hereof, 1,945 shares of Series A convertible
preferred stock are issued and outstanding.  All of such outstanding shares have
been, or upon issuance will be, validly issued and are fully paid and
nonassessable.  Except as set forth above in this Section 3(p): (i) none of the
Company’s capital stock is subject to preemptive rights or any other similar
rights or any liens or encumbrances suffered or permitted by the Company; (ii)
there are no outstanding options, warrants, scrip, rights to subscribe to, calls
or commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company or any of its Subsidiaries, or contracts, commitments,
understandings or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional shares of capital stock of the
Company or any of its Subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into, or exercisable or exchangeable for, any
capital stock of the Company or any of its Subsidiaries; (iii) there are no
agreements or arrangements under which the Company or any of its Subsidiaries is
obligated to register the sale of any of their securities under the 1933 Act
(except pursuant to the Registration Rights Agreement); (iv) there are no
outstanding securities or instruments of the Company or any of its Subsidiaries
which contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries; and (v) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Common Shares; and (vi) except for the Company’s equity incentive plans, the
Company does not have any stock appreciation rights or “phantom stock” plans or
agreements or any similar plan or agreement.  The Company has filed as exhibits
to the SEC Documents true, correct and complete copies of the
Company’s  Certificate of Incorporation, as amended and as in effect on the date
hereof (the “Certificate of Incorporation”), and the Company’s By-Laws, as
amended and as in effect on the date hereof (the “Bylaws”), and the material
terms of all securities convertible into, or exercisable or exchangeable for,
shares of Common Stock and the material rights of the holders thereof in respect
thereto.
 
 
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(q)           Indebtedness and Other Contracts.  Except as set forth in the
Company’s SEC Documents, neither the Company nor any of its Subsidiaries (i) has
any outstanding Indebtedness (as defined below), (ii) is a party to any
contract, agreement or instrument, the violation of which, or default under
which, by the other party(ies) to such contract, agreement or instrument would
result in a Material Adverse Effect, or (iii) is in violation of any term of or
in default under any contract, agreement or instrument, except where such
violations and defaults would not result, individually or in the aggregate, in a
Material Adverse Effect.  The material terms of any such outstanding
Indebtedness are described in the SEC Documents.  For purposes of this
Agreement:  (x) “Indebtedness” of any Person means, without duplication (A) all
indebtedness for borrowed money, (B) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services, including
(without limitation) “capital leases” in accordance with GAAP (other than trade
payables entered into in the ordinary course of business), (C) all reimbursement
or payment obligations with respect to letters of credit, surety bonds and other
similar instruments, (D) all obligations evidenced by notes, bonds, debentures
or similar instruments, including obligations so evidenced incurred in
connection with the acquisition of property, assets or businesses, (E) all
Indebtedness created or arising under any conditional sale or other title
retention agreement, or incurred as a financing, in either case, with respect to
any property or assets acquired with the proceeds of such Indebtedness (even
though the rights and remedies of the seller or bank under such agreement in the
event of default are limited to repossession or sale of such property), (F) all
monetary obligations under any leasing or similar arrangement which, in
connection with GAAP, consistently applied for the periods covered thereby, is
classified as a capital lease, (G) all Indebtedness referred to in clauses (A)
through (F) above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any mortgage,
lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or
become liable for the payment of such Indebtedness, and (H) all Contingent
Obligations in respect of Indebtedness or obligations of others of the kinds
referred to in clauses (A) through (G) above; (y) “Contingent Obligation” means,
as to any Person, any direct or indirect liability, contingent or otherwise, of
that Person with respect to any Indebtedness, lease, dividend or other
obligation of another Person if the primary purpose or intent of the Person
incurring such liability, or the primary effect thereof, is to provide assurance
to the obligee of such liability that such liability will be paid or discharged,
or that any agreements relating thereto will be complied with, or that the
holders of such liability will be protected (in whole or in part) against loss
with respect thereto; and (z) “Person” means an individual, a limited liability
company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or agency
thereof.
 
(r)           Absence of Litigation.  Except as would not reasonably be expected
to have a Material Adverse Effect, there is no action, suit, proceeding, inquiry
or investigation before or by the Principal Market, any court, public board,
government agency, self-regulatory organization or body pending or, to the
Knowledge of the Company, threatened against or affecting the Company or any of
its Subsidiaries, the Common Stock or any of the Company’s Subsidiaries or any
of the Company’s or its Subsidiaries’ officers or directors.
 
(s)           Insurance.  The Company and each of its Subsidiaries are insured
by insurers of recognized financial responsibility against such losses and risks
and in such amounts as management of the Company believes to be prudent and
customary in the businesses in which the Company and its Subsidiaries are
engaged.  Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for and neither the Company nor any such
Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect.
 
 
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(t)           Employee Relations.
 
(i)           Neither the Company nor any of its Subsidiaries is a party to any
collective bargaining agreement or employs any member of a union.  The Company
and its Subsidiaries believe that their relations with their employees are
generally satisfactory.  No executive officer of the Company or any of its
Subsidiaries has notified the Company or any such Subsidiary that such officer
intends to leave the Company or any such Subsidiary or otherwise terminate such
officer’s employment with the Company or any such Subsidiary.  To the Knowledge
of the Company, no executive officer of the Company or any of its Subsidiaries,
is, or is now expected to be, in violation of any material term of any
employment contract, non-competition agreement, or any other agreement
containing restrictive covenants with respect to his or her employment, and the
continued employment of each such executive officer does not subject the Company
or any of its Subsidiaries to any liability with respect to any such matters.
 
(ii)          The Company and its Subsidiaries are in compliance with all
federal, state, local and foreign laws and regulations respecting labor,
employment and employment practices and benefits, terms and conditions of
employment and wages and hours, except where failure to be in compliance would
not, either individually or in the aggregate, reasonably be expected to result
in a Material Adverse Effect.
 
(u)           Title.  The Company and its Subsidiaries do not own any real
estate property.  Except as would not reasonably be expected to have a Material
Adverse Effect, the Company and its Subsidiaries have good and marketable title
to all personal property owned by them which is material to the business of the
Company and its Subsidiaries, in each case free and clear of all liens,
encumbrances and defects, except for (i) liens for current taxes not yet due and
payable, (ii) liens imposed by law and incurred in the ordinary course of
business for obligations not past due, (iii) liens in respect of pledges or
deposits under workers’ compensation or similar laws and (iv) liens and
encumbrances which do not materially affect the value of such property and do
not interfere with the use made and proposed to be made of such property by the
Company and any of its Subsidiaries.  Any real property and facilities held
under lease by the Company and any of its Subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as would not
reasonably be expected to have a Material Adverse Effect and do not interfere
with the use made and proposed to be made of such property and buildings by the
Company and its Subsidiaries or would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
 
(v)           Intellectual Property Rights.  Except as would not reasonably be
expected to have a Material Adverse Effect, the Company and its Subsidiaries own
or possess adequate rights or licenses to use all trademarks, service marks and
all applications and registrations therefor, trade names, patents, patent
rights, copyrights, original works of authorship, inventions, trade secrets and
other intellectual property rights (“Intellectual Property Rights”) necessary to
conduct their respective businesses as conducted on the date of this
Agreement.  To the Knowledge of the Company, no product or service of the
Company or its Subsidiaries infringes the Intellectual Property Rights of
others.  Except as would not reasonably be expected to have a Material Adverse
Effect, the Company has not received notice of any claim being made or brought,
or to the Knowledge of the Company, being threatened, against the Company or its
Subsidiaries regarding (i) its Intellectual Property Rights, or (ii) that the
products or services of the Company or its Subsidiaries infringe the
Intellectual Property Rights of others.  The Company is not aware of any facts
or circumstances which might give rise to any of the foregoing claims.
 
 
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(w)          Environmental Laws.  The Company and its Subsidiaries (i) are in
compliance with any and all Environmental Laws (as hereinafter defined), (ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license or
approval where, in each of the foregoing clauses (i), (ii) and (iii), the
failure to so comply could be reasonably expected to have, individually or in
the aggregate, a Material Adverse Effect.  The term “Environmental Laws” means
all federal, state, local or foreign laws relating to pollution or protection of
human health or the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata), including,
without limitation, laws relating to emissions, discharges, releases or
threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, “Hazardous Materials”) into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations issued, entered, promulgated or approved thereunder.
 
(x)           Subsidiary Rights.  The Company and each of its Subsidiaries has
the unrestricted right to vote, and (subject to limitations imposed by
applicable law) to receive dividends and distributions on, all capital
securities of its Subsidiaries as owned by the Company or each such Subsidiary.
 
(y)           Tax Status.  The Company and each of its Subsidiaries (i) has made
or filed all foreign, federal and state income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject,
(ii) has paid all taxes and other governmental assessments and charges that are
material in amount, shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and (iii) has set aside
on its books provision reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply.  There are no unpaid taxes in any material amount claimed to be due by
the taxing authority of any jurisdiction, and the officers of the Company know
of no reasonable basis for any such claim.
 
(z)           Internal Accounting and Disclosure Controls.  The Company and each
of its Subsidiaries maintain in all material respects a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset and liability accountability, (iii) access to assets or incurrence of
liabilities is permitted only in accordance with management’s general or
specific authorization and (iv) the recorded accountability for assets and
liabilities is compared with the existing assets and liabilities at reasonable
intervals and appropriate action is taken with respect to any difference.  The
Company maintains in all material respects disclosure controls and procedures
(as such term is defined in Rule 13a-14 under the 1934 Act) that are effective
in ensuring that information required to be disclosed by the Company in the
reports that it files or submits under the 1934 Act is recorded, processed,
summarized and reported, within the time periods specified in the rules and
forms of the SEC, including, without limitation, controls and procedures
designed in to ensure that information required to be disclosed by the Company
in the reports that it files or submits under the 1934 Act is accumulated and
communicated to the Company’s management, including its principal executive
officer or officers and its principal financial officer or officers, as
appropriate, to allow timely decisions regarding required disclosure.  During
the twelve months prior to the date hereof, neither the Company nor any of its
Subsidiaries have received any notice or correspondence from any accountant
relating to any material weakness in any part of the system of internal
accounting controls of the Company or any of its Subsidiaries.
 
 
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(aa)         Off Balance Sheet Arrangements.  There is no transaction,
arrangement, or other relationship between the Company and an unconsolidated or
other off-balance sheet entity that is required to be disclosed by the Company
in the SEC Documents and is not so disclosed and that otherwise would be
reasonably likely to have a Material Adverse Effect.
 
(bb)        Investment Company Status.  The Company is not, and upon
consummation of the sale of the Common Shares will not be, an “investment
company,” a company controlled by an “investment company” or an “affiliated
person” of, or “promoter” or “principal underwriter” for, an “investment
company,” as such terms are defined in the Investment Company Act of  1940, as
amended.
 
(cc)         Form S-3 Eligibility.  The Company is eligible to register the
Common Shares for resale by the Buyers using Form S-3 promulgated under the 1933
Act.
 
(dd)        Transfer Taxes.  On the Closing Date, all stock transfer or other
taxes (other than income or similar taxes) which are required to be paid in
connection with the sale and transfer of the Common Shares to be sold to each
Buyer hereunder will be, or will have been, fully paid or provided for by the
Company, and all U.S. laws imposing such taxes will be or will have been
complied with.
 
(ee)         Manipulation of Price.  The Company has not, and to its Knowledge,
no one acting on its behalf has, (i) taken, directly or indirectly, any action
designed to cause or to result in the stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of any of the
Common Shares, or (ii) sold, bid for, purchased, or paid any compensation for
soliciting purchases of, any of the Common Shares.
 
(ff)          Disclosure.  The Company confirms that neither it nor any Person
acting on its behalf has provided any of the Buyers or their respective agents
or counsel with any information that constitutes material, nonpublic
information.  The Company understands and confirms that each of the Buyers will
rely on the foregoing representations in effecting transactions in securities of
the Company.  All disclosure provided to the Buyers regarding the Company, its
business and the transactions contemplated hereby, furnished by or on behalf of
the Company, when taken as a whole, together with all other information provided
or available in the SEC Documents, does not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading.
 
 
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(gg)        Patriot Act/OFAC.  To the Company’s Knowledge, neither the Company
nor any of its Subsidiaries (i) is a Person whose property or interest in
property is blocked or subject to blocking pursuant to Section 1 of Executive
Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions
with Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg.
49079 (2001)) (“Executive Order 13224”), (ii) engages in any dealings or
transactions prohibited by Section 2 of such Executive Order 13224, or is
otherwise associated with any such Person in any manner violative of Section 2
of Executive Order 13224, (iii) is a Person on the Specially Designated
Nationals and Blocked Persons List administered by the U.S. Department of the
Treasury’s Office Foreign Assets Control (“OFAC”), or (iv) has failed to comply,
in any material respects, with the (a) Trading with the Enemy Act, as amended,
and each of the rules, regulations and Executive Orders administered by OFAC
(including but not limited to 31 CFR, Subtitle B, Chapter V, as amended) and any
other enabling legislation or executive order relating thereto, and (b) Uniting
and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism.
 
(hh)        Client Transferability.  The Company acknowledges that BlackRock
Investment Management (UK) Limited (“BIM (UK)”) is purchasing the Common Shares
on behalf of a number of underlying beneficial owners who have each appointed
BIM (UK) to manage their assets under a discretionary investment management
agreement (“Clients”).  Investments made by accounts under management by BIM
(UK) will be held in the name of BIM (UK)’s nominee company.  Each of the
Clients has different investment objectives and as a result from time to time
BIM (UK) may reallocate its holdings of Common Shares to different Clients
subject to the requirements of applicable securities laws.  The Company
acknowledges that any such reallocation of Common Shares to different Clients
does not breach any restriction on resale or transfer of shares contained in the
Company’s Certificate of Incorporation, as amended, and Bylaws such reallocation
being subject to the requirements of any applicable securities laws.
 
 
4.
COVENANTS.

 
(a)           Efforts.  Each party shall use its commercially reasonable efforts
timely to satisfy each of the conditions to be satisfied by it as provided in
Sections 5 and 6 of this Agreement.
 
(b)           Form D and Blue Sky.  The Company agrees to file a Form D with
respect to the Common Shares as required under Regulation D.  The Company, on or
before the Closing Date, shall take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for or to qualify the
Common Shares for sale to the Buyers at the Closing pursuant to this Agreement
under applicable securities or “Blue Sky” laws of the states of the United
States (or to obtain an exemption from such qualification), and shall provide
evidence of any such action so taken to the Buyers on or prior to the Closing
Date as the Buyers may reasonably request.  The Company shall make all filings
and reports relating to the offer and sale of the Common Shares required under
applicable securities or “Blue Sky” laws of the states of the United States
following the Closing Date.
 
 
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(c)           Reporting Status.  Until the date on which the Investors (as
defined in the Registration Rights Agreement) shall have sold all the Common
Shares (the “Reporting Period”), the Company shall timely file all reports
required to be filed with the SEC pursuant to the 1934 Act, and the Company
shall not voluntarily terminate its status as an issuer required to file reports
under the 1934 Act even if the 1934 Act or the rules and regulations thereunder
would otherwise permit such termination.
 
(d)           Use of Proceeds.  The Company will use the proceeds from the sale
of the Common Shares for general corporate purposes, and not for redemption or
repurchase of any of its or its Subsidiaries’ equity securities.  No part of the
proceeds from the sale of the Common Shares hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(the “Board”) (12 CFR 207), or for the purpose of buying or carrying or trading
in any securities under such circumstances as to involve the Company in a
violation of Regulation X of said Board (12 CFR 224) or to involve any broker or
dealer in a violation of Regulation T of said Board (12 CFR 220). As used in
this Section, the terms “margin stock” and “purpose of buying or carrying” shall
have the meanings assigned to them in said Regulation U. No part of the proceeds
from the sale of the Common Shares will be used, directly or indirectly, for any
payments to: (a) any person, entity or country on the SDN List or the Blocked
Persons List administered by the OFAC and/or any other similar lists
administered by OFAC pursuant to any authorizing statute, Executive Order or
regulation; (b) the government of any country currently subject to an OFAC
sanctions program; or (c) any governmental official or employee, political
party, official of a political party, candidate for political office, anyone
else acting in an official capacity, or any agent of any such individual or
entity, in order to obtain, retain or direct business or obtain any improper
advantage, in violation of the United States Foreign Corrupt Practices Act of
1977, as amended.
 
(e)           Financial Information.  The Company agrees to send the following
to each Investor (as defined in the Registration Rights Agreement) during the
Reporting Period unless the following are filed with the SEC through EDGAR and
are available to the public through the EDGAR system: (i) within five “Business
Days” (as defined below) after the filing thereof with the SEC, a copy of its
Annual Reports and Quarterly Reports on Form 10-K, or 10-Q, any Current Reports
on Form 8-K and any registration statements (other than on Form S-8) or
amendments thereto filed pursuant to the 1933 Act and  (ii) copies of any
notices and other information made available or given to the stockholders of the
Company generally, substantially contemporaneously with the making available or
giving thereof to its stockholders.  As used herein, “Business Day” means any
day other than Saturday, Sunday or other day on which commercial banks in
Houston, Texas are authorized or required by law to remain closed.
 
(f)           Listing.  The Company shall secure the listing of all of the
Registrable Securities (as defined in the Registration Rights Agreement) upon
the NYSE Amex prior to Closing and shall maintain such listing of all
Registrable Securities from time to time issuable under the terms of the
Transaction Documents.  The Company shall use its commercially reasonable
efforts to maintain the Common Stock’s authorization for quotation on the
Principal Market.  The Company shall pay all fees and expenses in connection
with satisfying its obligations under this Section 4(f).
 
 
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(g)           Fees.  The Company shall be responsible for the payment of any
fees associated with the private placement of the Common Stock pursuant to this
Agreement (other than fees or commissions of Persons engaged by any Buyer or any
Buyer’s investment advisor) relating to or arising out of the transactions
contemplated hereby, including, without limitation, the reasonable costs and
expenses of the Buyer’s legal counsel.  The Company shall pay, and hold each
Buyer harmless against, any liability, loss or expense (including, without
limitation, reasonable attorney’s fees and out-of-pocket expenses) arising in
connection with any claim relating to any such payment.  Except as set forth
herein or as otherwise set forth in the Transaction Documents, each party to
this Agreement shall bear its own expenses in connection with the sale of the
Common Shares to the Buyers.
 
(h)           Disclosure of Transactions and Other Material Information.  On or
before 9:30 a.m., Houston, Texas time, on the first Business Day following the
date of this Agreement, the Company shall issue a press release and file a
Current Report on Form 8-K describing the terms of the transactions contemplated
by the Transaction Documents in the form required by the 1934 Act and attaching
the Registration Rights Agreement as an exhibit to such filing (including all
attachments, the “8-K Filing”).  From and after the filing of the 8-K Filing
with the SEC, no Buyer shall be in possession of any material, nonpublic
information received from the Company, any of its Subsidiaries or any of their
respective officers, directors, employees or agents, that is not disclosed in
the 8-K Filing.  The Company shall not, and shall cause each of its Subsidiaries
and its and each of their respective officers, directors, employees and agents,
not to, provide any Buyer with any material, nonpublic information regarding the
Company or any of its Subsidiaries from and after the filing of the 8-K Filing
with the SEC without the express written consent of such Buyer.  Subject to the
foregoing, neither the Company, its Subsidiaries nor any Buyer shall issue any
press releases or any other public statements with respect to the transactions
contemplated hereby; provided, however, that (A) the Company shall be entitled,
without the prior approval of any Buyer, to make any press release or other
public disclosure with respect to such transactions (i) in substantial
conformity with the 8-K Filing and contemporaneously therewith and (ii) as is
required by applicable law and regulations (provided that in the case of clause
(i) each Buyer shall be consulted by the Company in connection with any such
press release or other public disclosure prior to its release) and (B) such
Buyer shall be entitled, without the prior approval of the Company, to make any
public filings required by applicable law or regulation.  Without the prior
written consent of any applicable Buyer, neither the Company nor any of its
Subsidiaries or affiliates shall disclose the name of such Buyer in any filing,
announcement, release or otherwise other than in connection with the
Registration Statement, as contemplated pursuant to the Registration Rights
Agreement, unless such disclosure is required by law, regulation or the
Principal Market.
 
(i)            Legend Removal.  On the six month anniversary of the closing
date, the Company shall issue a certificate without the legend included in
Section 2(g) upon the request of such holder and consistent with and pursuant to
the requirements of Rule 144.
 
 
5.
CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.

 
The obligation of the Company hereunder to issue and sell the Common Shares to
each Buyer at the Closing is subject to the satisfaction, at or before the
Closing Date, of each of the following conditions, provided that these
conditions are for the Company’s sole benefit and may be waived by the Company
at any time in its sole discretion by providing each Buyer with prior written
notice thereof:
 
 
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(i)           Each Buyer shall have executed each of the Transaction Documents
to which it is a party and delivered the same to the Company.
 
(ii)          Such Buyer and each other Buyer shall have delivered to the
Company the Purchase Price for the Common Shares being purchased by such Buyer
and each other Buyer at the Closing by wire transfer of immediately available
funds pursuant to the wire instructions provided by the Company.
 
(iii)         The representations and warranties of each Buyer shall be true and
correct in all material respects (except for those representations and
warranties that are qualified by materiality or Material Adverse Effect, which
shall be true and correct in all respects) as of the date when made and as of
the Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and correct as
of such specified date), and each Buyer shall have performed, satisfied and
complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by each
Buyer at or prior to the Closing Date.
 
 
6.
CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE.

 
The obligation of each Buyer hereunder to purchase the Common Shares at the
Closing is subject to the satisfaction, at or before the Closing Date, of each
of the following conditions, provided that these conditions are for each Buyer’s
sole benefit and may be waived by such Buyer at any time in its sole discretion
by providing the Company with prior written notice thereof:
 
(i)           The Company shall have duly executed and delivered to such Buyer
(i) each of the Transaction Documents and (ii) the Common Shares (in such
amounts as such Buyer shall request) being purchased by such Buyer at the
Closing pursuant to this Agreement.
 
(ii)          Such Buyer shall have received an opinion of Patton Boggs LLP,
special counsel for the Company, dated the Closing Date, in substantially the
form of Exhibit B attached hereto.
 
(iii)         The Company shall have delivered to such Buyer a certificate
evidencing the incorporation and good standing of the Company and certificates
of the Secretary of State of the state or jurisdiction of incorporation,
formation or organization of each of the Company’s significant subsidiaries (as
such term is defined in Rule 1-02 of Regulation S-X) incorporated, formed or
organized in the United States certifying the due incorporation, formation or
organization and the good standing of such entities as of a date within ten (10)
Business Days of the Closing Date.
 
(iv)        The Common Stock (I) shall be listed on the Principal Market and
(II) shall not have been suspended, as of the Closing Date, by the SEC or the
Principal Market from trading on the Principal Market nor shall suspension by
the SEC or the Principal Market have been threatened, as of the Closing Date,
either (A) in writing by the SEC or the Principal Market or (B) by falling below
the minimum listing maintenance requirements of the Principal Market.
 
 
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(v)         The Company shall have delivered to such Buyer a certificate,
executed by the Secretary of the Company and dated as of the Closing Date, as to
(i) the resolutions consistent with Section 3(b) as adopted by the Company’s
Board of Directors in a form reasonably acceptable to such Buyer, (ii) the
Certificate of Incorporation, as amended, and (iii) the Bylaws, as amended, each
as in effect at the Closing, in the form attached hereto as Exhibit C.
 
(vi)        The representations and warranties of the Company shall be true and
correct in all material respects (except for those representations and
warranties that are qualified by materiality or Material Adverse Effect, which
shall be true and correct in all respects) as of the date when made and as of
the Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and correct as
of such specified date) and the Company shall have performed, satisfied and
complied in all material respects with the covenants, agreements and conditions
required by the Transaction Documents to be performed, satisfied or complied
with by the Company at or prior to the Closing Date.  Such Buyer shall have
received a certificate, executed by the Chief Executive Officer of the Company,
dated as of the Closing Date, to the foregoing effect in the form attached
hereto as Exhibit D.
 
(vii)       The Company shall have delivered to such Buyer a letter from the
Company’s transfer agent certifying the number of shares of Common Stock
outstanding as of a date within five days of the Closing Date.
 
(viii)      The Company shall have obtained all governmental, regulatory or
third party consents and approvals, if any, necessary for the sale of the Common
Shares.
 
(ix)         The Common Shares to be delivered on the Closing Date to such Buyer
shall have been approved for listing on the NYSE Amex, subject to official
notice of issuance.
 
(x)          The Company shall have delivered to such Buyer such other documents
relating to the transactions contemplated by this Agreement as such Buyer or its
counsel may reasonably request.
 
7.            TERMINATION.  In the event that the Closing shall not have
occurred with respect to a Buyer on or before five Business Days from the date
hereof due to the Company’s or such Buyer’s failure to satisfy the conditions
set forth in Sections 5 and 6 above (and the nonbreaching party’s failure to
waive such unsatisfied condition(s)), the nonbreaching party shall have the
option to terminate this Agreement with respect to such breaching party at the
close of business on such date without liability of any party to any other party
other than for breach of this Agreement prior to its termination.
 
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8.
MISCELLANEOUS.

 
(a)           Governing Law; Jurisdiction; Jury Trial.  All questions concerning
the construction, validity, enforcement and interpretation of this Agreement
shall be governed by the internal laws of the State of Texas, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of New York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York.  Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper.  Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.  EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
 
(b)           Counterparts.  This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party; provided that a facsimile signature
shall be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an original, not
a facsimile signature.
 
(c)           Headings.  The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.
 
(d)           Severability.  If any provision of this Agreement shall be invalid
or unenforceable in any jurisdiction, such invalidity or unenforceability shall
not affect the validity or enforceability of the remainder of this Agreement in
that jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.
 
(e)           Entire Agreement; Amendments.  This Agreement and the other
Transaction Documents supersede all other prior oral or written agreements
between the Buyers, the Company, their affiliates and Persons acting on their
behalf with respect to the matters discussed herein, and this Agreement, the
other Transaction Documents and the instruments referenced herein and therein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor any Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters.  No provision of this
Agreement may be amended other than by an instrument in writing signed by the
Company and the Buyers listed on the Schedule of Buyers as being obligated to
purchase 100% of the amount of the Common Shares to be sold hereunder.  No
provision hereof may be waived other than by an instrument in writing signed by
the party against whom enforcement is sought.  No such amendment shall be
effective to the extent that it applies to less than all of the holders of the
Common Shares then outstanding.  No consideration shall be offered or paid to
any Person to amend or consent to a waiver or modification of any provision of
any of the Transaction Documents unless the same consideration also is offered
to all of the parties to the Transaction Documents or holders of Common Shares
as the case may be.  The Company has not, directly or indirectly, made any
agreements with any Buyers relating to the terms or conditions of the
transactions contemplated by the Transaction Documents except as set forth in
the Transaction Documents.  Without limiting the foregoing, the Company confirms
that, except as set forth in this Agreement, no Buyer has made any commitment or
promise or has any other obligation to provide any financing to the Company or
otherwise.
 
 
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(f)           Notices.  Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered:  (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one Business Day after deposit with
an overnight courier service, in each case properly addressed to the party to
receive the same.  The addresses and facsimile numbers for such communications
shall be:
 
If to the Company:
 
Hyperdynamics Corporation
12012 Wickchester Lane, Suite 475
Houston, TX 77079

 
Telephone:
(713) 353-9400

 
Facsimile:
(713) 353-9421

Attention:  Paolo Amoruso, Esq.

with a copy to:
 
Patton Boggs LLP
1801 California Street, Suite 4900
Denver, Colorado  80202

 
Telephone:
(303) 894-6169

 
Facsimile:
(303)894-9239

 
Attention:
Robert M. Bearman, Esq.

 
If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers, with copies to such Buyer’s representatives as set forth on the Schedule
of Buyers, or to such other address and/or facsimile number and/or to the
attention of such other Person as the recipient party has specified by written
notice given to each other party five (5) days prior to the effectiveness of
such change.  Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender’s facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission or (C) provided by an overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from an overnight
courier service in accordance with clause (i), (ii) or (iii) above,
respectively.
 
 
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(g)           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns,
including any purchasers of the Common Shares.  The Company shall not assign
this Agreement or any rights or obligations hereunder without the prior written
consent of the holders of 100% of the aggregate number of Common Shares issued
and issuable hereunder.  A Buyer may not assign all or any portion of its rights
under this Agreement or the other Transaction Documents without the prior
written consent of the Company, provided, however, that a Buyer shall be
permitted to assign its rights, in whole or in part, under this Agreement and
the other Transaction Documents to any affiliate of such Buyer or any investment
fund under common management who meets the suitability requirements set forth in
this Agreement and who agrees in writing to be irrevocably bound by the terms of
this Agreement and the other Transaction Documents.
 
(h)           No Third Party Beneficiaries.  This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.
 
(i)           Survival.  Unless this Agreement is terminated under Section 7,
the representations and warranties of the Company and the Buyers contained in
Sections 2 and 3 shall survive the Closing and the agreements and covenants set
forth in Sections 4 and 8 shall survive the Closing until fully performed by the
applicable party.  Each Buyer shall be responsible only for its own
representations, warranties, agreements and covenants hereunder.
 
(j)           Further Assurances.  Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
 
(k)           Indemnification.
 
(i)           In consideration of each Buyer’s execution and delivery of the
Transaction Documents and acquiring the Common Shares thereunder and in addition
to all of the Company’s other obligations under the Transaction Documents, the
Company shall defend, protect, indemnify and hold harmless each Buyer and each
other holder of the Common Shares and all of their stockholders, partners,
members, officers, directors, employees and direct or indirect investors and any
of the foregoing Persons’ agents or other representatives (including, without
limitation, those retained in connection with the transactions contemplated by
this Agreement) (collectively, the “Indemnitees”) from and against any and all
actions, causes of action, suits, claims, losses, costs, penalties, fees,
liabilities and damages, and expenses in connection therewith (irrespective of
whether any such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable attorneys’ fees and disbursements
(the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or
arising out of, or relating to (a) any misrepresentation or breach of any
representation or warranty made by the Company in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby,
(b) any breach of any covenant, agreement or obligation of the Company contained
in the Transaction Documents or any other certificate, instrument or document
contemplated hereby or thereby or (c) any cause of action, suit or claim brought
or made against such Indemnitee by a third party (including for these purposes a
derivative action brought on behalf of the Company) and arising out of or
resulting from (i) the execution, delivery, performance or enforcement of the
Transaction Documents or any other certificate, instrument or document
contemplated hereby or thereby, (ii) any transaction financed or to be financed
in whole or in part, directly or indirectly, with the proceeds of the issuance
of the Common Shares, or (iii) the status of such Buyer or holder of the Common
Shares as an investor in the Company.  To the extent that the foregoing
undertaking by the Company may be unenforceable for any reason, the Company
shall make the maximum contribution to the payment and satisfaction of each of
the Indemnified Liabilities which is permissible under applicable law.  Except
as otherwise set forth herein, the mechanics and procedures with respect to the
rights and obligations under this Section 9(k) shall be the same as those set
forth in Section 6 of the Registration Rights Agreement.
 
 
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(l)            No Strict Construction.  The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.
 
(m)           Remedies.  Each Buyer and each holder of the Common Shares shall
have all rights and remedies set forth in the Transaction Documents and all
rights and remedies which such holders have been granted at any time under any
other agreement or contract and all of the rights which such holders have under
any law.  Any Person having any rights under any provision of this Agreement
shall be entitled to enforce such rights specifically (without posting a bond or
other security), to recover damages by reason of any breach of any provision of
this Agreement and to exercise all other rights granted by law.  Furthermore,
the Company recognizes that in the event that it fails to perform, observe, or
discharge any or all of its obligations under the Transaction Documents, any
remedy at law may prove to be inadequate relief to the Buyers.  The Company
therefore agrees that the Buyers shall be entitled to seek temporary and
permanent injunctive relief in any such case without the necessity of proving
actual damages and without posting a bond or other security.
 
(n)           Payment Set Aside.  To the extent that the Company makes a payment
or payments to the Buyers hereunder or pursuant to any of the other Transaction
Documents or the Buyers enforce or exercise their rights hereunder or
thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other Person under any law (including, without limitation, any
bankruptcy law, foreign, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such enforcement
or setoff had not occurred.
 
 
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(o)           Independent Nature of Buyers’ Obligations and Rights.  The
obligations of each Buyer under any Transaction Document are several and not
joint with the obligations of any other Buyer, and no Buyer shall be responsible
in any way for the performance of the obligations of any other Buyer under any
Transaction Document.  Nothing contained herein or in any other Transaction
Document, and no action taken by any Buyer pursuant hereto or thereto, shall be
deemed to constitute the Buyers as, and the Company acknowledges that the Buyers
do not so constitute, a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Buyers are in any way
acting in concert or as a group, and the Company will not assert any such claim
with respect to such obligations or the transactions contemplated by the
Transaction Documents and the Company acknowledges that the Buyers are not
acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Transaction Documents.  The Company
acknowledges and each Buyer confirms that it has independently participated in
the negotiation of the transaction contemplated hereby with the advice of its
own counsel and advisors (or has had the opportunity to seek advice from its own
counsel and advisors).  Each Buyer shall be entitled to independently protect
and enforce its rights, including, without limitation, the rights arising out of
this Agreement or out of any other Transaction Documents, and it shall not be
necessary for any other Buyer to be joined as an additional party in any
proceeding for such purpose.
 
(p)           Currency.  As used herein, “Dollar,” “US Dollar” and “$” each mean
the lawful money of the United States.
 
[Signature Page Follows]
 
 
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IN WITNESS WHEREOF, the parties have executed this Stock Purchase Agreement as
of the date first written above.
 

 
[INSERT NAME OF BUYER (THAT IS AN
ENTITY)]
     
By:
   
         
Name (printed):
   
  
  
  
  
  
  
Title:
   
  
  
  
  
  
  
Address:
   
  
  
  
   
  
  
  
   
  
  
  
  
  
Number of Common Shares:
   
  
  
  
  
  
  
Aggregate purchase price: $
   
  
  
  
  
  
Tax ID No.:
   
  
  
  
  
  
  
Contact Name:
   
  
  
  
     
Telephone:
   
         
Name in which the Common Shares should be registered (if different):
   
   
         
Relationship between the Buyer and the person or entity in whose name the Common
Shares should be registered (if different):
   
   
   
Agreed to and Accepted by:
     
HYPERDYNAMICS CORPORATON
     
By:
   
 
Name:
   
Title:
   

 
 
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IN WITNESS WHEREOF, the parties have executed this Stock Purchase Agreement as
of the date first written above.
  

 
Signature:
  
  
  
  
  
Name (printed):
  
  
  
  
  
Address:
  
  
  
  
  
  
  
  
  
  
Number of Common Shares:
  
  
  
  
  
Aggregate purchase price: $
  
  
  
  
Tax ID No./SSN:
  
  
  
  
  
Contact Name:
  
  
  
  
  
Telephone:
  
     
Name in which the Common Shares should be registered (if different):
 
  
     
Relationship between the Buyer and the person or entity in whose name the Common
Shares should be registered (if different):
 
  
   
Agreed to and Accepted by:
     
HYPERDYNAMICS CORPORATON
     
By:
  
 
Name:
   
Title:
   

 
 
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