ESCROW AGREEMENT

THIS ESCROW AGREEMENT, dated as of March 31, 2010 between STW Resources Holding
Corp. (the "Company") and Viewpoint Securities LLC (“Viewpoint”)with TD BANK,
N.A., a Banking Corporation organized and existing under the laws of the United
States of America acting as the Escrow Agent (the "Escrow Agent").

WITNESSETH:

The Company, pursuant to a Stock Purchase Agreement dated as of February 2010
(the "Agreement") is offering securities (the "Offering") to certain qualified
subscribers (the "Subscribers") consisting of a 12% Convertible Note. Payments
will be released to the Company upon written request by the Company to the
Escrow Agent.

Pursuant to the terms of the Offering, the Company will deliver to the Escrow
Agent each subscription payment (a “Subscription Payment”) received by the
Company from a subscriber. The Subscription Payment of such subscriber will be
collectively held in one escrow by the Escrow Agent on the terms and conditions
hereinafter set forth. The Company will maintain all subscriber records and at
least bi-weekly supply the Escrow Agent with a list showing such subscribers
name, address and amount of Subscription Payment.

The offering will be made on a “best efforts” basis directly by the Company. The
offering and sale of the Shares will terminate no later than 365 days following
the effectiveness of the offering (the (“Effective Date”), unless extended upon
written direction by the Company for up to an additional days, or such earlier
date as shall be determined by the Company (the “Termination Date”). No funds
will be accepted by the Escrow Agent after the Termination Date.

The Company agrees to provide the Escrow Agent, in writing, with the Effective
Date and the Termination Date.

NOW, THEREFORE, the Company and the Escrow Agent agree as follows:

1. Deposits. Each Subscription Payment received by the Company from a subscriber
shall be forwarded to the Escrow Agent along with a certificate from the Company
(the "Subscription Certificate") setting forth the name, address, social
security number and telephone number of such subscriber, the number of Units or
fractional or split Units being purchased and the purchase price being paid for
the same. If the Subscription Payment is in the form of a check, it shall be
enclosed with the Subscription Agreement. If the Subscription Payment is to be
made by wire transfer, the Subscription Agreement shall also state the name,
address and telephone number of the financial institution that will be wiring
such Subscription Payment.
 

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Each Subscription Payment received by the Escrow Agent from the Company will be
deposited and held in accordance with Section 6(a) below. Such account will be
held in the name of (the "Escrow"). It is understood that all checks received by
Escrow Agent are subject to clearance time and the funds represented thereby
cannot be drawn upon or invested until such time as the same constitute good and
collected funds. It is additionally understood that should any checks be
returned to the Escrow Agent as uncollectible, or returned because of
insufficient funds, the Escrow Agent is authorized and instructed to charge
expenses incurred by the Escrow Agent on such uncollected checks to the Escrow.
The Escrow Agent shall redeposit such check(s) for collection only upon the
verbal instruction of the Company; however, in no instance shall the check(s) be
presented for collection more than two (2) times. Should the check(s) be
uncollectible after the second presentation, the Escrow Agent, shall promptly
notify the Company and hold said check(s) until the subscriber has replaced the
same with a cashier's check or such other form of draft that the Company and
escrow Agent approve, at which time the Escrow Agent shall as soon as
practicable return said uncollectible check(s) to the subscriber. In the event
the subscriber does not replace said check(s) with a cashier's check or such
other form or draft acceptable to Escrow Agent and the Company, the Escrow Agent
shall as soon as practicable return the same to such subscriber.

2. Rejection of Subscription Payment. The Company hereby certifies that such
Subscription Agreement provides that the purchase of any Unit is subject to the
approval of the Company. The Company agrees to notify the Escrow Agent in
writing or telephonically with written confirmation as to which Subscriptions
are being accepted and which rejected. All such rejections shall be refunded to
the respective subscribers at the close of this escrow pursuant to the procedure
described in Paragraph 4 hereof, as applicable, or as otherwise directed in
writing by the company.

3. Release of Escrow Funds on Closing. If on a Closing Date, as shortened or
extended pursuant to the terms of the Agreement the Escrow Agent (a) holds
Subscription Payments, representing subscriptions as to which the Company has
notified the Escrow Agent, pursuant to paragraph 2 hereof, that the Company has
accepted, and (b) has received from the Company a certificate stating that all
conditions to such Closing have been met, (i.e. specifically, in the case of the
Initial Closing, that the Aggregate Subscription Amount has been accepted), then
the Escrow Agent is authorized and instructed to make the following payments:
(i) all principal amounts held by the Escrow Agent in the Escrow representing
subscriptions as to which the Company has notified the Escrow Agent, pursuant to
Paragraph 2 hereof, that the Company has accepted, shall be paid to the Company;
(ii) all principal amounts held by the Escrow Agent in the Escrow, representing
subscriptions as to which the Company has notified the Escrow Agent, pursuant to
paragraph 2 hereof, that the Partnership has rejected, shall be paid to the
subscriber. All payments to be made by the Escrow Agent to a subscriber shall be
forwarded to the last known address of the subscriber, as communicated in
writing to the Escrow Agent by the Company, mailed by first class mail. All
payments to be made by the Escrow Agent to the Company shall be forwarded to the
Company at 619 West Texas Avenue Suite 126, Midland, Texas 79701, or issued to
such account if the Company as the Company shall direct. Upon release of any
funds pursuant to this Paragraph 4, the Escrow shall be closed as to the funds
released; provided, however , that this Agreement shall remain in effect for
further Subscription Payments received by the Escrow Agent from subscribers
which shall be placed in Escrow and held by the Escrow Agent in accordance with
the terms of this Agreement.

Once the Escrow Agent receives Escrowed Funds a Release Notice, in the form
attached hereto as Exhibit A, (the “Release Notice”) must be executed by both
the Company and the Placement Agent, such Release Notice shall instruct the
Escrow Agent to wire the aggregate Subscription Amounts for the Securities per
the joint disbursement instructions of the Company and the Placement Agent.
 

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Upon release of any funds pursuant to this Paragraph 3, the Escrow shall be
closed as to the funds released; provided, however , that this Agreement shall
remain in effect for further Subscription Payments received by the Escrow Agent
from subscribers which shall be placed in Escrow and held by the Escrow Agent in
accordance with the terms of this Agreement.

4. Other Refunds. If the Escrow Agent has received from the Company a
certificate stating that the Offering is being terminated, then the Escrow Agent
is authorized and instructed to make the following payments: (i) all principal
amounts held by the Escrow Agent in the Escrow together less the expenses
incurred by the Escrow Agent for uncollected checks, if any, shall be paid to
the subscribers of the Company; (ii) All earnings shall be paid to the Company.
All payments to be made by the Escrow Agent to a subscriber, as communicated in
writing to the Escrow Agent by the Company, will be mailed by first class mail.
All payments to be made by the Escrow Agent to the Company shall be forwarded to
619 West Texas Avenue Suite 126, Midland, Texas 79701 or issued to such account
as the Company may direct. Upon release of the funds pursuant to this Paragraph
4, the Escrow Agent's duties as Escrow Agent will cease and the Escrow shall be
closed.

5. Fees. The Company hereby agrees that the Escrow Agent shall be entitled to a
fee of $3,500 plus all out of pocket expenses incurred by the Escrow Agent, (the
“Escrow Fee”). The fee is due and payable upon execution of the Escrow
Agreement. If any fee is not so paid, it shall become a charge upon the Escrowed
Funds. The Escrow Agent agrees that in the event that a subsidiary company to
the Company is formed to facilitate investment in the Company, the Escrow Fee
shall include services to the subsidiary Company which are the same as the
services set forth herein to the Company and the Escrow Fee shall be prorated
between the two companies

6. Rights, Liabilities and Indemnification of the Escrow Agent.

(a)         The Escrowed Funds shall be invested by the Escrow Agent in
accordance with the signed, written instructions of the Board of Directors for
STW Resources Holding Corp. In the absence of written instructions from the
above-named party, the Escrow Agent shall invest the Escrowed Funds in the money
market mutual funds customarily utilized by the Escrow Agent's corporate trust
department in the ordinary course of its corporate trust and escrow agent
duties. Such money market mutual fund is the Financial Square Treasury
Obligations Money Market Fund.

 In investing the Escrowed Funds, the Escrow Agent shall rely upon the written
instructions of and the Escrow Agent shall be and hereby is relieved of all
liability with respect to making, holding, redeeming or selling such investments
in accordance with such instructions. In the absence of the written investment
instructions contemplated herein, for any reasons whatsoever, the Escrow Agent
shall be and hereby is relieved of all liability with respect to making,
holding, redeeming or selling investments made in accordance with the preceding
paragraph which prescribes the permissible investment vehicles for the Escrowed
Funds absent written instructions from the Board of Directors for STW Resources
Holding Corp. .
 

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Escrow Agent is and shall be under no duty to enforce the obligation oto furnish
written investment instructions nor shall the Escrow Agent be liable to any
person, firm or corporation, including any of the parties hereto, for the
investments made, held, redeemed or sold as directed herein in the event that
written investment instructions from the Board of Directors for STW Resources
Holding Corp. are not furnished to the Escrow Agent.
 
  (b)        The Escrow Agent shall not be responsible for or be required to
enforce any of the terms or conditions of the Escrow Agreement or any other
agreement between STW Resources Holding Corp. and Viewpoint Securities LLC.

The Escrow Agent shall not be responsible or liable in any manner whatsoever for
the performance of or by STW Resources Holding Corp. and Viewpoint Securities
LLC of their respective obligations under this Agreement nor shall the Escrow
Agent be responsible or liable in any manner whatsoever for the failure of the
other parties to this Escrow Agreement or of any third party to honor any of the
provisions of this Escrow Agreement.

  (c)        The parties hereto represent to the Escrow Agent that they are
authorized to enter into the Escrow Agreement by their duly authorized
representatives and that the Escrow Agent is entitled to rely on this
representation without the need to confirm the authority of the representatives.

  (d)        The duties and obligations of the Escrow Agent shall be limited to
and determined solely by the express provisions of this Escrow Agreement and no
implied duties or obligations shall be read into this Escrow Agreement against
the Escrow Agent.

  (e)        The Escrow Agent is not bound by and is under no duty to inquire
into the terms or validity of any other agreements or documents, including any
agreements or documents which may be related to, referred to in or deposited
with the Escrow Agent in connection with this Escrow Agreement.

  (f)          The Escrow Agent shall be entitled to rely upon and shall be
protected in acting in reliance upon any instruction, notice, information,
certificate, instrument or other document which is submitted to it in connection
with its duties under this Escrow Agreement and which the Escrow Agent in good
faith believes to have been signed or presented by the proper party or parties.
The Escrow Agent shall have no liability with respect to the form, execution,
validity or authenticity thereof.
 
  (g)        The Escrow Agent shall not be liable for any act which the Escrow
Agent may do or omit to do hereunder, or for any mistake of fact or law, or for
any error of judgment, or for the misconduct of any employee, agent or attorney
appointed by it, while acting in good faith, unless caused by or arising from
its own gross negligence or willful misconduct.

  (h)        The Escrow Agent shall be entitled to consult with counsel of its
own selection and the opinion of such counsel shall be full and complete
authorization and protection to the Escrow Agent in respect of any action taken
or omitted by the Escrow Agent hereunder in good faith and in accordance with
the opinion of such counsel.

(i)                                      The Escrow Agent shall have the right
at any time to resign for any reason and be discharged of its duties as Escrow
Agent hereunder by giving written notice of its resignation to the parties
hereto at least thirty days/business days prior to the date specified for such
resignation to take effect. All obligations of the Escrow Agent hereunder shall
cease and terminate on the effective date of its resignation and its sole
responsibility thereafter shall be to hold the Escrowed Funds, etc. for a period
of thirty days/business days following the effective date of resignation, at
which time,
 

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I)                   if a successor escrow agent shall have been appointed and
written notice thereof shall have been given to the resigning Escrow Agent by
parties hereto and the successor escrow agent, then the resigning Escrow Agent
shall deliver the Escrowed Funds, etc. to the successor escrow agent; or

II)                 if a successor escrow agent shall not have been appointed,
for any reason whatsoever, the resigning Escrow Agent shall deliver the Escrowed
Funds, etc. to a court of competent jurisdiction and give written notice of the
same to the parties hereto.

The resigning Escrow Agent shall be entitled to be reimbursed by STW Resources
Holding Corp. and Viewpoint Securities LLC for any expenses incurred in
connection with its resignation and transfer of the Escrowed Funds, etc.,
pursuant to and in accordance with the provisions of this section.

 (j)          STW Resources Holding Corp. and Viewpoint Securities LLC. jointly
and severally agree to indemnify and hold the Escrow Agent harmless from and
against any and all liabilities, causes of action, claims, demands, judgments,
damages, costs and expenses (including reasonable attorneys fees and expenses)
that may arise out of or in connection with the Escrow Agent's good faith
acceptance of or performance of its duties and obligations under this Escrow
Agreement. The Escrow Agent shall be under no duty to institute any suit, or to
take any remedial procedures under this Escrow Agreement, or to enter any
appearance or in any way defend any suit in which it may be made a defendant
hereunder until it shall be indemnified as provided above.

  (k)        In the event that the Escrow Agent shall be uncertain as to its
duties or rights hereunder or shall receive instructions with respect to the
Escrow Fund which, in its sole discretion, are in conflict either with other
instructions received by it or with any provision of this Agreement, the Escrow
Agent shall have the absolute right to suspend all further performance under
this Escrow Agreement (except for the safekeeping of the Escrow Fund) until the
resolution of such uncertainty or conflicting instructions to the Escrow Agent's
sole satisfaction by final judgment of a court of competent jurisdiction, joint
written instructions from all of the other parties hereto, or otherwise.

  (l)         In the event that any controversy arises between one or more of
the parties hereto or any other party with respect to this Escrow Agreement or
the Escrow Fund, the Escrow Agent shall not be required to determine the proper
disposition of such controversy or the proper disposition of the Escrow Fund and
shall have the absolute right, in its sole discretion, to deposit the Escrow
Fund with the Clerk of a court of competent jurisdiction, file a suit in
interpleader and obtain an order from the court requiring all parties involved
to litigate in such court their respective claims arising out of or in
connection with the Escrow Fund. Upon the deposit by the Escrow Agent of the
Escrow Fund with the Clerk of a court of competent jurisdiction in accordance
with this provision, the Escrow Agent shall be relieved of all further
obligations and released from all liability hereunder.
 

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  (m)        The Company hereby indemnifies and holds the Escrow Agent harmless
from any possible violations of any Environmental Laws including any local,
state or federal law, rule or regulation pertaining to environmental matters, as
now or hereafter enacted or amended, including without limitation, the Federal
Comprehensive Environmental Response; Compensation and Liability Act of 1980;
the Federal Resource Conservation and Recovery Act; the Federal Superfund
Amendments and Reauthorization Act of 1986; the Federal Toxic Substance Control
Act; the Federal Hazardous Material Transportation Act; the Federal Clean Air
Act; the Federal Water Pollution Control Act; the Industrial Site Recovery Act;
the New Jersey Spill Act; the Underground Storage Tank Act; together with any
other federal, state or local superlien, or other statutes, rules or
regulations, as now or hereafter amended in any way pertaining to clean-up,
disclosure, water pollution control, air pollution control, regulation of solid
waste, hazardous waste management, storage tanks, regulation of environmentally
sensitive areas, use of ground water, surface waters and wetlands, hazardous and
toxic substance reporting and any other laws including case laws, which might be
deemed or referred to as environmental common law.

Neither this Escrow Agreement, nor any other agreement between the Company,
ViewPoint Securities LLC and the Escrow Agent shall be deemed to create a joint
venture between the Escrow Agent and the Company and Viewpoint. Nor shall the
Escrow Agent be considered the alter ego of the Company by virtue of this
Agreement, or any other agreement.

7.                Modification, Amendment, Rescission. No rescission,
modification, amendment, supplement or change of this Escrow Agreement shall be
valid or in effect unless notice thereof is given to the Escrow Agent in writing
by the Company and accepted by the Escrow Agent.

8.                Successors and Assigns. The provisions hereof shall be binding
upon and inure to the benefit of the parties hereto and their respective legal
representatives, heirs, successors or assigns and shall survive the termination
of this Escrow Agreement.

9.                Copies. This Escrow Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

10.              Notices. All notices, instructions and other communications
under this Escrow Agreement shall be in writing except as otherwise specified
herein and shall be deemed duly given if sent by certified or registered mail,
postage prepaid, return receipt requested and addressed as follows:

(a)
If to the Escrow Agent:
     
TD Bank, NA
 
Attn.: Corporate Trust Administration
 
1701 Route 70 East

 

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Cherry Hill, NJ 08034
 
Telephone: (856) 751-2735
 
Fax: (856) 470-6186
   
(b)
If to the Company:
     
STW Resources Holding Corp.
 
Attention Stanley T. Weiner
 
619 West Texas Avenue Suite 126
 
Midland, Texas 79701
 
Fax: (432) 205-0440
   
(c)
If to Viewpoint:      
401 West A Street
 
Suite 325
 
San Diego, CA 92101
 
Telephone: (619) 272-2810
 
Fax: (619) 272-2811

 
11.              Applicable Law. This Escrow Agreement shall be governed by and
construed in accordance with the laws of the United State of America.

IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement on
the day and year first above written.

 
STW Resources Holding Corp.
       
By:
     
Stanley T. Weiner
 
Title: Chairman and CEO

 

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TD Bank, N.A.
       
By:
         
Title:
         
Viewpoint Securities, LLC
       
By:
     
Paul C. DiFrancesco
 
Title: Partner

 
 

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Exhibit A

RELEASE NOTICE
 
The UNDERSIGNED, pursuant to the Escrow Agreement, dated as of July 10, 2009,
among STW Resources, Inc. (the “Company”), Viewpoint Securities, LLC (“VP
Securities” or “Placement Agent”), as attorney-in-fact for each of the
Purchasers and TD Bank, National Association (the “Escrow
Agreement”). (Capitalized terms used herein and not defined shall have the
meaning ascribed to such terms in the Escrow Agreement), hereby notify the
Escrow Agent that each of the conditions precedent to the purchase and sale of
the Securities set forth in the Subscription Agreement have been satisfied. The
Company and Placement Agent hereby confirm that all of their respective
representations and warranties contained in the Subscription Agreement remain
true and correct and authorize the release by the Escrow Agent of the funds as
described in the Escrow Agreement. This Release Notice shall not be effective
until executed by the Company and VP Securities. This Release Notice may be
signed in one or more counterparts, each of which shall be deemed an
original. The Escrow Agent is hereby authorized to disburse such funds as
follows:
 
1.  $                              to STW Resources, Inc. in accordance with the
following wire instructions:
 
STW Resources, Inc.
Bank Name:
Bank Routing # 
Account Number:
SWIFT:
Bank Address:

2.  $                              to Viewpoint Securities, LLC_ in accordance
with the following wire instructions:
 
Viewpoint Securities, LLC
Bank Name:
Bank Routing # 
Account Number:
Bank Address:

IN WITNESS WHEREOF, the undersigned have caused this Release Notice to be duly
executed and delivered as of this day of 2010.
 
STW RESOURCES, INC.
 
By:
    Name:   Title: 

VIEWPOINT SECURITIES, LLC
 
By:
    Name:    Title: 

 
 

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