DEBENTURE EXCHANGE AGREEMENT
 
THIS DEBENTURE EXCHANGE AGREEMENT (this “Agreement”) is dated as of April ___,
2010, by and between Epic Energy Resources, Inc., a Colorado corporation (the
“Corporation”), and the undersigned individual (a “Holder” and collectively, the
“Holders”).  The Corporation and Holder are referred to as a “Party” and
collectively as the “Parties”.
 
WHEREAS, Holder owns a 10% Secured Debenture (the “Debenture”);
 
WHEREAS, the Holders each desire to exchange the principal amount of their
Debenture set forth on their signature page hereto (collectively, the “Tendered
Principal Amount”) for common stock of the Corporation, no par value (the
“Shares”); and
 
WHEREAS, the Corporation desires to exchange (the “Exchange”) fourteen newly
issued and unregistered Share for each $1.00 of Tendered Principal Amount (the
Shares received in the Exchange, referred to in this Agreement as the “Exchanged
Securities”), but only up to 14,000,000 Shares.
 
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
 
1.           Exchange.
 
(a)           Exchange Ratio.  The Corporation and Holder hereby agree to
exchange at the Closing fourteen Exchanged Security for each $1.00 of Tendered
Principal Amount.
 
(b)           Exchange.  To effect this Exchange, Holder will deliver to the
Corporation this executed Agreement stating the Tendered Principal Amount, the
outstanding principal amount of the Holder’s Debenture will be permanently
reduced by an amount equal to Tendered Principal Amount (equivalent in effect to
the payment of a principal payment in an amount equal to the Tendered Principal
Amount) and the Corporation will deliver to Holder a stock certificate
representing the number of shares of Exchanged Securities that is equal to the
Tendered Principal Amount being so transferred by the Holder to the Corporation
within 10 business days after the Closing Date.
 
2.           The Closing.
 
(a)           Closing Date.  The closing of the transactions contemplated by
this Agreement (the “Closing”) shall take place at the offices of Mayer Brown
LLP, 700 Louisiana, Suite 3400, Houston, Texas 77002 at 10:00 a.m., Houston
time, on April 9, 2010 (“Closing Date”), or at such other place, date or time as
the Corporation may determine in its sole discretion.
 
(b)           Conditions to Closing of Holders.  The obligation of Holders to
consummate the transactions on the Closing Date as contemplated by this
Agreement shall be subject to the satisfaction or waiver on or prior to the
Closing Date of the following conditions:
 
 
 

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(i)           the Corporation shall have performed and complied in all material
respects with all obligations and agreements required to be performed and
complied with by the Corporation hereunder on or prior to the Closing Date; and
 
(ii)          the representations and warranties of the Corporation contained in
this Agreement shall be true and correct in all material respects as of the
Closing Date as if made as of such date.
 
(c)           Conditions to Closing of Corporation.  The obligation of the
Corporation to consummate the transactions on the Closing Date shall be subject
to the satisfaction or waiver on or prior to the Closing Date of the following
conditions:
 
(i)           Holder shall have each performed and complied in all material
respects with all obligations and agreements required to be performed and
complied with by Holder hereunder on or prior to the Closing Date;
 
(ii)          the representations and warranties of Holder contained in this
Agreement shall be true and correct in all material respects as of the Closing
Date as if made as of such date;
 
(iii)        there shall not have occurred or be likely to occur any event
materially affecting the Corporation’s business or financial affairs that would
or might reasonably be expected to prohibit, prevent, restrict or delay the
Closing or that might reasonably be expected to be material to any Holder in
deciding whether to participate in the Exchange;
 
(iv)        there shall not have been any action taken or threatened, or any
statute, rule, regulation, judgment, order, stay, decree or injunction
promulgated, enacted, entered, enforced or deemed applicable to the Exchange, by
or before any court or governmental regulatory or administrative agency or
authority, tribunal, domestic or foreign, that (a) challenges the making of the
Exchange or might reasonably be expected to, directly or indirectly, prohibit,
prevent, restrict or delay consummation of, or might otherwise reasonably be
expected to adversely affect in any material manner, the Exchange; or (b) could
reasonably be expected to materially adversely affect the Corporation’s
business, condition (financial or otherwise), income, operations, properties,
assets, liabilities or prospects, or materially impair the contemplated benefits
of the Exchange, or the consummation of the Exchange as a whole to the
Corporation or that might be material to Holders in deciding whether to
participate in the Exchange;
 
(v)         the Corporation’s sale of a minimum of 3,500,000 shares of the
Corporation’s Series A Preferred Stock, as contemplated by Corporation’s
confidential private placement memorandum dated as of March 13, 2010, as
supplemented on April 8, 2010 (the “Private Placement Memorandum”);
 
(vi)        the holders of the Corporation’s Series C Warrants tender, and do
not withdraw, 100% of the Corporation’s outstanding Series C Warrants, as
contemplated by the Private Placement Memorandum;
 
 
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(vii)       the holders of the Corporation’s Series D Warrants tender, and do
not withdraw, 100% of the Corporation’s outstanding Series D Warrants, as
contemplated by the Private Placement Memorandum;
 
(viii)      holders of at least 90% of the outstanding principal amount of the
Debentures execute the Waiver and Amendment to Debenture and the Amendment to
Securities Purchase Agreement, as contemplated by the Private Placement
Memorandum; and
 
(ix)         the exchange by the Corporation and management and directors of
deferred compensation and board fees for prior periods and a permanent reduction
of management’s 2010 base salaries for 1,200,000 shares of the Corporation’s
Series A Preferred Stock, as contemplated in the Private Placement Memorandum.
 
3.           Representations and Warranties of the Corporation.  The Corporation
represents and warrants to Holder as follows:
 
(a)           Corporate Status.  The Corporation is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Colorado and is duly licensed or qualified to transact business as a foreign
corporation and is in good standing in each jurisdiction in which the nature of
the business transacted by it or the character of the properties owned or leased
by it requires such licensing or qualification, except where the failure to be
so licensed or qualified would not reasonably be expected to have a material
adverse effect on the business, condition (financial or otherwise) or assets of
the Corporation.  The Corporation has full power and authority, corporate or
otherwise, to own and hold its properties and to carry on its business as now
conducted and as proposed to be conducted, to execute, deliver and perform this
Agreement.
 
(b)           Authorization/Enforceability.  The execution and delivery of this
Agreement and the performance by the Corporation of its obligations hereunder,
have been duly authorized by all requisite action, corporate or otherwise, and
constitute the valid and legally binding obligations of the Corporation,
enforceable in accordance with its terms and conditions.  The Corporation need
not give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any Governmental Authority in order to consummate the
transactions contemplated by this Agreement, except with respect to federal and
state securities laws.
 
(c)           Non-Contravention.  The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby, will not violate
any provision of law, any order of any court or other agency of government or
the Articles of Incorporation or Bylaws of the Corporation, as may be amended to
date, and do not and will not result in a material breach of or constitute (with
due notice or lapse of time or both) a material default under any provision of
any indenture, agreement or other instrument to which the Corporation, or any of
its properties or assets, is bound.
 
 
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(d)           Consents/Approvals.  No consent, approval, authorization, order,
registration or qualification of or with any Governmental Authority or other
Person or entity is required for the issuance and sale of the Exchanged
Securities by the Corporation to Holder or the consummation by the Corporation
of the transactions contemplated by this Agreement.
 
(e)           Exchanged Securities Authorization.  The Exchanged Securities have
been duly authorized and, when issued and delivered, will be duly and validly
issued and fully paid and nonassessable.  Upon consummation of the transactions
contemplated hereby, good and valid title to the Exchanged Securities, free and
clear of all Claims, will be transferred by the Corporation to Holder.
 
(f)           Capitalization.  The capitalization of the Corporation is as set
forth on Schedule 3(f), which Schedule 3(f) shall also include the number of
shares of the Corporation’s common stock, no par value (“Common Stock”) owned
beneficially, and of record, by Affiliates of the Corporation as of April 5,
2010.  The Corporation has not issued any capital stock since its most recently
filed periodic report under the Securities Exchange Act of 1934, as amended
(“Exchange Act”), other than pursuant to the exercise of employee stock options
under the Corporation’s stock option plans, the issuance of shares of Common
Stock to employees pursuant to the Corporation’s employee stock purchase plans
and pursuant to the conversion and/or exercise of other securities of the
Corporation that are convertible into Common Stock outstanding as of the date of
the most recently filed periodic report under the Exchange Act.  The issuance of
securities hereunder will not obligate the Corporation to issue shares of Common
Stock or other securities to any Person (other than the Holders) and will not
result in a right of any holder of Corporation securities to adjust the
exercise, conversion, exchange or reset price under any of such securities. All
of the outstanding shares of capital stock of the Corporation are validly
issued, fully paid and nonassessable, have been issued in compliance with all
federal and state securities laws, and none of such outstanding shares was
issued in violation of any preemptive rights or similar rights to subscribe for
or purchase securities.  There are no stockholders agreements, voting agreements
or other similar agreements with respect to the Corporation’s capital stock to
which the Corporation is a party or, to the knowledge of the Corporation,
between or among any of the Corporation’s stockholders.
 
4.           Representations and Warranties of Holder.  Holder represents and
warrants, severally and not jointly, to the Corporation as follows:
 
(a)           Legal Capacity.  Holder has full legal right, power and capacity
to execute and deliver this Agreement and to perform his, her or its obligations
hereunder.  This Agreement constitutes the valid and legally binding obligation
of Holder, enforceable in accordance with its terms and conditions.  Holder need
not give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any third party or Governmental Authority in order to
consummate the transactions contemplated by this Agreement.  Except as set forth
on the signature page hereto, no Person has any community property rights by
virtue of marriage or otherwise in the Debenture owned by such Holder.  Any such
Person with community property rights has duly executed and delivered to the
Corporation at or prior to the Closing a copy of the consent attached hereto as
Exhibit A.  If such Holder is not a natural person, it has been duly organized,
and is validly existing and in good standing, under the laws of its jurisdiction
of formation, and it has properly taken all corporate, limited liability,
partnership or other action required to be taken by such Holder with respect to
the execution and delivery of this Agreement and consummate the transactions
contemplated by this Agreement.
 
 
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(b)           Title to the Debenture.  Holder is the lawful record and
beneficial owner of the Debenture with respect to which it will be tendering the
Tendered Principal Amount that will be exchanged pursuant to Section 1 of this
Agreement with good and marketable title thereto, and the Holder has the right
to sell, assign, convey, transfer and deliver the Tendered Principal
Amount.  Holder acknowledges and agrees that it will have no further rights or
claims with respect to such Tendered Principal Amount of its Debenture.  The
exchange of the securities as contemplated herein will reduce the outstanding
principal amount of Holder’s Debenture by the Tendered Principal Amount.
 
(c)           Non-Contravention.  The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby, will not violate
any provision of law, any order of any court or other agency of government or
the organizational documents of the Holder, as may be applicable and as amended
to date, and do not and will not result in a material breach of or constitute
(with due notice or lapse of time or both) a material default under any
provision of any indenture, agreement or other instrument to which the Holder,
or any of its properties or assets, is bound.
 
(d)           Consents/Approvals.  No consent, approval, authorization, order,
registration or qualification of or with any Governmental Authority or other
entity or Person is required for the Exchange or the consummation by Holder of
the transactions contemplated by this Agreement.
 
(e)           Investment Representations.
 
(i)           Holder qualifies as an “accredited investor” (as defined in Rule
501(a) of Regulation D under the Securities Act of 1933, as amended (the
“Securities Act”)) and is acquiring the Exchanged Securities hereunder for its
own account and with no intention of distributing or selling the Exchanged
Securities except pursuant to a registration or an available exemption under
applicable law.  Holder understands that the Exchanged Securities have not been
(and are not being) registered under the Securities Act by reason of their
contemplated issuance in transaction(s) exempt from the registration and
prospectus delivery requirements of the Securities Act pursuant to Section 4(2)
thereof (including the rules and regulations promulgated thereunder), and that
the reliance of the Corporation on such exemption from registration may be
predicated in part on the representations and warranties of Holder hereunder.
 
(ii)          Holder agrees that it will not sell or otherwise dispose of any of
the Exchanged Securities unless such sale or other disposition has been
registered or is exempt from registration under the Securities Act and has been
registered or qualified or is exempt from registration or qualification under
applicable securities laws of any state.
 
 
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(iii)         Holder understands that a restrictive legend consistent with the
foregoing set forth in Section 7(a) of this Agreement has been or will be placed
on the certificates evidencing the Exchanged Securities to be issued to it
hereunder, and related stop transfer instructions will be noted in the transfer
records of the Corporation and/or its Transfer Agent for the Exchanged
Securities during the Suspension.
 
(iv)        Holder represents that it is not an Affiliate of the Corporation,
and Holder covenants and agrees that if it becomes an Affiliate, it will
promptly provide notice to the Corporation of such status and comply with
insider trading laws and policies and the applicable “control securities”
provisions of Rule 144 in addition to any other obligations set forth in this
Agreement.
 
(v)         Holder has such knowledge and experience in financial and business
matters so as to be capable of evaluating the merits and risk of an investment
in the Exchanged Securities.  Holder acknowledges that it has had access to all
information concerning the Corporation and its respective businesses, assets,
liabilities, financial statements, and obligations which have been requested and
has been provided the opportunity to ask questions of and receive answers from
the Corporation to fully and effectively evaluate the Exchange and the
transactions contemplated herein.  Holder acknowledges and represents that it
has received and reviewed the Private Placement Memorandum.  Holder understands
that a new holding period for purposes of Rule 144 under the Securities Act will
be triggered with respect to the Exchanged Securities, and such Holder is able
to bear the economic risk of loss of the investment in such Exchanged Securities
and is able to afford a complete loss of such investment.
 
5.           Withdrawal.  Any Holder as to itself only (but not with respect to
the other Holders) may withdraw all of such Holder’s Tendered Principal Amount
from the Exchange on or prior to March 31, 2010.
 
6.           Certain Definitions.
 
(a)           “Affiliate” (and, with a correlative meaning, “affiliated”) means,
with respect to any Person, any direct or indirect subsidiary of such Person,
and any other Person that directly, or through one or more intermediaries,
Controls or is Controlled by or is under common Control with such first
Person.  As used in this definition, “Control” (and, with correlative meanings,
“Controlled by” and “under common Control with”) means the possession, directly
or indirectly, of the power to direct the management or policies of a Person
(whether through ownership of securities or partnership or other ownership
interests, by contract or otherwise) and shall be construed as such term is used
in the rules promulgated under the Securities Act.
 
 
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(b)           “Claims” shall mean the following of any nature whatsoever:
security interests, liens, deeds of trust, hypothecations, pledges, claims
(pending or threatened), charges, escrows, encumbrances, lock-up arrangements,
options, rights of first offer or refusal, community property rights, mortgages,
indentures, security agreements or other agreements, arrangements, contracts,
commitments, understandings or obligations, whether written or oral and whether
or not relating in any way to credit or the borrowing of money.
 
(c)           “Commission” means the United States Securities and Exchange
Commission.
 
(d)           “Governmental Authority” means any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, including any governmental authority, independent or autonomous
official authority, agency, department, board, commission or instrumentality of
the United States or any other country, or any political subdivision thereof,
whether federal, state or local, and any tribunal, court or arbitrator(s) of
competent jurisdiction.
 
(e)           “Person(s)” means and includes any natural persons, sole
proprietorships, corporations, limited partnerships, limited liability
companies, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, banks, trust companies, land trusts, business
trusts or other organizations, whether or not legal entities, all Governmental
Authorities and all other entities.
 
(f)           “Registration Rights Agreement” means the Registration Right
Agreement, dated the date hereof, among the Corporation and the Holders and
other signatories thereto.
 
(g)           “Trading Day” means a day on which the principal Trading Market is
open for trading.
 
(h)           “Trading Market” means any of the following markets or exchanges
on which the Common Stock is listed or quoted for trading on the date in
question: the NYSE AMEX, the Nasdaq Capital Market, the Nasdaq Global Market,
the Nasdaq Global Select Market, the New York Stock Exchange or the OTC Bulletin
Board (or any successors to any of the foregoing).
 
(i)           “Transfer Agent” shall mean TranShare Corporation at 5150 DTC
Parkway, Suite 325, Greenwood Village, CO 80111, in its capacity as transfer
agent to the Corporation, or any successor transfer agent to the Corporation.
 
 
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7.           Miscellaneous.
 
(a)           Transfer Restrictions.
 
(i)           The Exchanged Securities may only be disposed of in compliance
with state and federal securities laws. In connection with any transfer of
Exchanged Securities other than pursuant to an effective registration statement
or Rule 144, to the Corporation or to an Affiliate of a Holder or in connection
with a pledge as contemplated in Section 7(a)(iii), the Corporation may require
the transferor thereof to provide to the Corporation an opinion of counsel
selected by the transferor and reasonably acceptable to the Corporation, the
form and substance of which opinion shall be reasonably satisfactory to the
Corporation, to the effect that such transfer does not require registration of
such transferred Exchanged Securities under the Securities Act. As a condition
of transfer, any such transferee shall agree in writing to be bound by the terms
of this Agreement and shall have the rights of a Holder under this Agreement and
the Registration Rights Agreement.
 
(ii)          The Holder agrees to the imprinting, so long as is required by
this Section 7(a), of a legend on any of the Exchanged Securities in the
following form:
 
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR THE SECURITIES LAWS
OF ANY STATE OR OTHER JURISDICTION.  THE SHARES MAY NOT BE OFFERED, SOLD,
PLEDGED, OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT, OR (2) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER
JURISDICTIONS, AND IN THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS
THE CORPORATION HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT
THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND
SUCH OTHER APPLICABLE LAWS.
 
(iii)        The Corporation acknowledges and agrees that Holder may from time
to time pledge pursuant to a bona fide margin agreement with a registered
broker-dealer or grant a security interest in some or all of the Exchanged
Securities to a financial institution that is an “accredited investor” as
defined in Rule 501(a) under the Securities Act and who agrees to be bound by
the provisions of this Agreement and the Registration Rights Agreement and, if
required under the terms of such arrangement, such Holder may transfer pledged
or secured Exchanged Securities to the pledgees or secured parties. Such a
pledge or transfer would not be subject to approval of the Corporation and no
legal opinion of legal counsel of the pledgee, secured party or pledgor shall be
required in connection therewith. Further, no notice shall be required of such
pledge. At the Holder’s expense, the Corporation will execute and deliver such
reasonable documentation as a pledgee or secured party of Exchanged Securities
may reasonably request in connection with a pledge or transfer of the Exchanged
Securities, including, if the Exchanged Securities are subject to registration
pursuant to the Registration Rights Agreement, the preparation and filing of any
required prospectus supplement under Rule424(b)(3) under the Securities Act or
other applicable provision of the Securities Act to appropriately amend the list
of selling stockholders thereunder.
 
 
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(iv)        Certificates evidencing the Exchanged Securities shall not contain
any legend (including the legend set forth in Section 7(a)(ii) hereof): (i)
while a registration statement covering the resale of such security is effective
under the Securities Act, or (ii) following any sale of such Exchanged
Securities pursuant to Rule 144, or (iii) if such Common Stock is eligible for
sale pursuant to Rule 144, or (iv) if such legend is not required under
applicable requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the Commission).  The
Corporation shall cause its counsel to issue a legal opinion to the Transfer
Agent promptly after the effective date of a registration statement if required
by the Transfer Agent to effect the removal of the legend hereunder.  The
Corporation agrees that following the effective date of a registration statement
or at such time as such legend is no longer required under this Section 7, it
will, no later than three Trading Days following the delivery by Holder to the
Corporation or the Transfer Agent of a certificate representing the Exchanged
Securities, as applicable, issued with a restrictive legend, deliver  or cause
to be delivered to Holder a certificate representing such shares that is free
from all restrictive and other legends. The Corporation may not make any
notation on its records or give instructions to the Transfer Agent that enlarge
the restrictions on transfer set forth in this Section 7.  Certificates for the
Exchanged Securities subject to legend removal hereunder shall be transmitted by
the Transfer Agent to Holder by crediting the account of the Holder’s prime
broker with the Depository Trust Corporation System as directed by Holder.
 
(v)         Holder agrees that Holder will sell any Exchanged Securities
pursuant to either the registration requirements of the Securities Act,
including any applicable prospectus delivery requirements, or an exemption
therefrom, and that if Exchanged Securities are sold pursuant to a registration
statement, they will be sold in compliance with the plan of distribution set
forth therein, and acknowledges that the removal of the restrictive legend from
certificates representing Exchanged Securities as set forth in this Section 7 is
predicated upon the Corporation’s reliance upon this understanding.
 
(b)           Material Nonpublic Information.  Holder acknowledges and agrees
that it has received material nonpublic information in connection with the
Exchange and that it will not sell or otherwise dispose of any of the Exchanged
Securities unless such material nonpublic information has been publicly
disclosed or no longer constitutes material nonpublic information.  The
Corporation shall, within 4 Trading Days of the date hereof, issue a Current
Report on Form 8-K disclosing the material terms of the transactions
contemplated hereby, and shall attach this Agreement and all other related
agreements thereto (the “8-K Filing”).  From and after the filing of the 8-K
Filing with the Commission, the Holder shall not be in possession of any
material, nonpublic information received from the Corporation or any of its
officers, directors, employees or agents, that is not disclosed in the 8-K
Filing.  The Corporation shall consult with the Holders in issuing any other
press releases with respect to the transactions contemplated hereby.
 
 
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(c)           DISCLAIMER.  THE REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
CONTAINED IN SECTION 3 CONSTITUTE THE SOLE AND EXCLUSIVE REPRESENTATIONS AND
WARRANTIES OF THE CORPORATION IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT.  EXCEPT FOR SUCH REPRESENTATIONS AND WARRANTIES, NO PARTY NOR
ANY OTHER PERSON MAKES ANY OTHER EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY
WITH RESPECT TO THE CORPORATION OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT, AND THE CORPORATION DISCLAIMS ANY OTHER REPRESENTATIONS OR
WARRANTIES, WHETHER MADE BY SUCH PARTY OR ANY OF ITS AFFILIATES, OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES (INCLUDING WITH RESPECT TO THE
DISTRIBUTION OF THE PRIVATE PLACEMENT MEMORANDUM, OR ANY PERSON’S RELIANCE ON,
ANY INFORMATION, DISCLOSURE OR OTHER DOCUMENT OR OTHER MATERIAL MADE AVAILABLE).
 
(d)           Equitable Remedy.  Each Party shall agree that in addition to any
other remedy that may be available to such Party hereunder, the Party shall be
entitled to specific performance.  Notwithstanding anything to the contrary in
this Agreement, each Party shall be responsible for paying its own expenses,
including legal fees, incurred in enforcing this Agreement.
 
(e)           Notices.  All notices, claims, demands and other communications
hereunder shall be in writing and shall be deemed given upon (i) confirmation of
receipt of a facsimile transmission, (ii) confirmation of delivery when
delivered by a standard overnight carrier or (iii) the expiration of five
(5) business days after the day when mailed by registered or certified mail
(postage prepaid, return receipt requested), addressed to the respective Parties
at the following addresses (or such other address for a Party as shall be
specified by like notice):
 
If to the Corporation, to:
Epic Energy Resources, Inc.

 
1450 Lake Robbins Drive, Suite 160

 
The Woodlands, TX 77380

 
Attention: Mike Kinney

 
Telephone: (281) 419-3742

 
Fax: (281) 419-1114

 
Email: MKinney@1Epic.com

 
 
If to any Holder, to:
At the Holder’s address, phone or

 
fax number appearing on the signature

 
page hereto.

 
(f)           No Third-Party Beneficiaries.  Unless otherwise specifically set
forth herein, this Agreement shall not confer any rights or remedies upon any
Person other than the Parties hereto and their respective successors and
assigns.
 
 
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(g)           Entire Agreement.  This Agreement (including the documents
referred to herein) constitutes the entire agreement among the parties hereto
and supersedes any prior understandings, agreements, or representations by or
among the parties, written or oral, to the extent they relate in any way to the
subject matter hereof.
 
(h)           Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
 
(i)           Headings.  The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
 
(j)           Governing Law.  All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York, without regard to the principles of conflicts of law thereof. Each
Party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and
(whether brought against a Party hereto or its respective Affiliates, directors,
officers, shareholders, employees or agents) shall be commenced exclusively in
the state and federal courts sitting in the City 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 improper or is an inconvenient venue for such
proceeding. 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 via registered or certified mail or overnight delivery
(with evidence of delivery) to such Party at the address in effect for 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 other
manner permitted by law. If either Party shall commence an action or proceeding
to enforce any provisions of this Agreement, then the prevailing Party in such
action or proceeding shall be reimbursed by the other Party for its reasonable
attorneys' fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such action or proceeding.
 
(k)           Amendments and Waivers.  No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by the
Corporation and Holder.
 
(l)           Gender.  All pronouns and any variation thereof shall be deemed to
refer to the masculine, feminine, neuter, singular, or plural as the identity of
the person or entity or the context may require.
 
 
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(m)           Severability.  Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
 
(n)           No Presumption Against Drafter.  Each of the Parties has jointly
participated in the negotiation and drafting of this Agreement.  In the event of
any ambiguity or a question of intent or interpretation arises, this Agreement
shall be construed as if drafted jointly by each of the Parties and no
presumptions or burdens of proof shall arise favoring any Party by virtue of the
authorship of any of the provisions of this Agreement.
 
(o)           Successors and Assigns.  Except as otherwise specifically provided
herein, this Agreement shall be binding upon, and inure to the benefit of, the
Parties hereto and their respective successors and permitted assigns.
 
(p)           Survival.  All covenants, agreements, representations and
warranties made herein shall survive the Closing and the consummation of the
exchange of the Debenture.
 
 
12

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EPIC ENERGY RESOURCES, INC.
signature page
 
IN WITNESS WHEREOF, the undersigned has executed this signature page evidencing
its tender of the principal amount of 10% Secured Debenture identified below in
exchange for Shares in the Corporation.
 
Principal Amount of 10% Secured Debenture tendered:
     
$____________ Debenture
Signature: _____________________________
     
Print Name: ____________________________
     
Address:______________________________
     
Phone:________________________________
     
Fax:__________________________________
   
If applicable,  Community Property Interest
 
In the 10% Secured Debenture
     
Signature:______________________
     
Print Name: ____________________
 

NOTE:  PLEASE DO NOT DATE THIS AGREEMENT AS IT WILL BE DATED IF AND WHEN
ACCEPTED BY THE CORPORATION.
 
IN WITNESS WHEREOF, the Corporation has agreed to and accepted this Debenture
Exchange Agreement subject to the terms and conditions hereof as of the day and
year set forth below.
 
Date: ___________________, 2010:
   
EPIC ENERGY RESOURCES, INC.
     
By:
   
Name:
 
Title:

 
 

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Exhibit A

FORM OF
COMMUNITY PROPERTY WAIVER
 
The undersigned spouse of _____________________ hereby acknowledges that she has
read, understands and consents to the terms and provisions of the Debenture
Exchange Agreement (the “Agreement”), executed as of ______________, 2010,
consents to the execution of the Agreement and any amendments, modifications and
supplements thereto by _____________________ and agrees that the undersigned’s
interest in the Debenture shall be subject to and bound by the Agreement.  The
undersigned’s obligations hereunder shall not be affected by any amendment or
other modification of the Agreement or any document related thereto, which may
be amended or modified at any time and from time to time, without the consent of
or notice to the undersigned.
 

 
  
 
Name

 

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Schedule 3(f)

The following table sets forth our capitalization as of  March 9, 2010 on an
actual basis.
 
Cash
  $ 153            
Debentures
    14,922  
Note Payable Secured by Assets Acquired
    1.343  
Note Payable – EIS Acquisition
    1,070  
Other Liabilities
    7,568  
Total Debt
  $ 24,903            
Stockholders’ equity
       
Series A Preferred Stock
  $ -  
Common Stock, no par value, authorized 100,000,000 shares; outstanding
45,413,7811, net of treasury stock
    33,639  
Warrants
    -  
Additional paid-in capital
    1,924  
Accumulated deficit
    (31,778 )
Accumulated other comprehensive loss
    -  
Treasury stock, at cost, no shares
    -  
Total stockholders’ equity
    3,785            
Total Capitalization
  $ 28,688  

 

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1 Of which, Affiliates of the Company own 77.5%.

 

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