NONE OF THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT SUBSCRIPTION RELATES HAVE
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"), OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY
NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED
HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN
EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED
BY REGULATION S UNDER THE 1933 ACT.

 

PRIVATE PLACEMENT SUBSCRIPTION

FOR NON U.S. SUBSCRIBERS

 

ARKANOVA ENERGY CORPORATION

 

PRIVATE PLACEMENT

MAXIMUM 9,375,000 SHARES OF COMMON STOCK

US$7,500,000

 

INSTRUCTIONS TO SUBSCRIBER:

 

1.

COMPLETE the information on page 10 of this Subscription.

 

2.

WIRE the Subscription Proceeds to Clark Wilson LLP, counsel to the Company,
pursuant to the wire instructions provided on page ii of this Subscription.

 

3.

FAX a copy of page 10 of this Subscription, and all pages of the applicable
Schedules of this Subscription to Clark Wilson LLP, attention Cam McTavish at
(604) 687-6314.

 

4.

COURIER the originally executed copy of the entire Subscription, together with
all duly signed Schedules, to Clark Wilson LLP, counsel to the Company, to

 

Clark Wilson LLP

800-885 W Georgia Street

Vancouver, B.C. Canada V6C 3H1

Attention: Cam McTavish

 

If you have any questions please contact Pierre Mulacek, President & CEO of the
Company, at: (281) 362-2787.

 

ARKANOVA ENERGY CORPORATION

21 Waterway Avenue, Suite 300

The Woodlands, Texas 77381

 

 

--------------------------------------------------------------------------------

ii

 

 

TRUST FUNDS (USD)

 

INSTRUCTIONS FOR WIRING FUNDS TO CLARK WILSON LLP

HSBC BANK USA

ONE HSBC CENTER

BUFFALO, NEW YORK 14203

ABA NO.:                          021 001 088
SWIFT CODE:               HKBCCATT
ACCOUNT NO.:            000050881

 

For further credit to:

HSBC BANK CANADA

885 WEST GEORGIA STREET

VANCOUVER, BRITISH COLUMBIA

V6C 3G1 CANADA

ACCOUNT NAME:                                     CLARK WILSON LLP

U.S. TRUST ACCOUNT NO.:                491689-002

TRANSIT NO.:                                               10020

BANK CODE:                                                 16

PLEASE ALSO INSTRUCT YOUR BANKER TO QUOTE

YOUR NAME AND OUR FILE NUMBER 31957-001/CZM

 

 

--------------------------------------------------------------------------------

 

 

NONE OF THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT SUBSCRIPTION RELATES HAVE
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"), OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY
NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED
HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN
EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED
BY REGULATION S UNDER THE 1933 ACT.

PRIVATE PLACEMENT SUBSCRIPTION

(Non U.S. Subscribers Only)

TO:

ARKANOVA ENERGY CORPORATION (the "Company")

21 Waterway Avenue, Suite 300

The Woodlands, Texas 77381

Purchase of Shares

1.

Subscription

1.1                          The undersigned (the "Subscriber") hereby
irrevocably subscribes for and agrees to purchase the number of shares of the
Company's common stock (the "Shares") as set out on page 10 of this Subscription
at a price of US$0.80 per Share (such subscription and agreement to purchase
being the "Subscription"), for the total subscription price as set out on page
10 of this Subscription (the "Subscription Proceeds"), which Subscription
Proceeds are tendered herewith, on the basis of the representations and
warranties and subject to the terms and conditions set forth herein.

1.2                          The Company hereby agrees to sell, on the basis of
the representations and warranties and subject to the terms and conditions set
forth herein, to the Subscriber the Shares. Subject to the terms hereof, the
Subscription will be effective upon its acceptance by the Company.

1.3                          Unless otherwise provided, all dollar amounts
referred to in this Subscription are in lawful money of the United States of
America.

2.

Payment

2.1                          The Subscription Proceeds must accompany this
Subscription and shall be wired directly to the Company's lawyers in accordance
with the wire instructions set out on page ii of this Subscription. The
Subscriber authorizes the Company's lawyers to deliver the Subscription Proceeds
to the Company.

2.2                          The Subscriber acknowledges and agrees that this
Subscription, the Subscription Proceeds and any other documents delivered in
connection herewith will be held by the Company's lawyers on behalf of the
Company. In the event that this Subscription is not accepted by the Company for
whatever reason within 60 days of the delivery of an executed Subscription by
the Subscriber, this

 

--------------------------------------------------------------------------------

- 2 -

 

Subscription, the Subscription Proceeds and any other documents delivered in
connection herewith will be returned to the Subscriber at the address of the
Subscriber as set forth in this Subscription without interest or deduction.

2.3                          Where the Subscription Proceeds are paid to the
Company, the Company may treat the Subscription Proceeds as a non-interest
bearing loan and may use the Subscription Proceeds prior to this subscription
being accepted by the Company.

2.4                          The Subscriber shall complete, sign and return to
the Company as soon as possible, on request by the Company, any documents,
questionnaires, notices and undertakings as may be required by regulatory
authorities, the OTC Bulletin Board, stock exchanges and applicable law.

3.

Closing

3.1                          Closing of the purchase and sale of the Shares
shall occur on or before August 31, 2007, or on such other date as may be
determined by the Company in its sole discretion (the "Closing Date"). The
Subscriber acknowledges that Shares may be issued to other subscribers under
this offering (the "Offering") before or after the Closing Date (the last sale
of Shares under this Offering being referred to as the "Final Closing Date").

4.

Acknowledgements of Subscriber

4.1

The Subscriber acknowledges and agrees that:

 

(a)

the Shares have not been registered under the Securities Act of 1933, as amended
(the "1933 Act"), or under any state securities or "blue sky" laws of any state
of the United States, and are being offered only in a transaction not involving
any public offering within the meaning of the 1933 Act, and, unless so
registered, may not be offered or sold in the United States or to U.S. Persons
(as defined herein), except pursuant to an effective registration statement
under the 1933 Act, or pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the 1933 Act, and in each case only
in accordance with applicable state securities laws;

 

(b)

the Company will refuse to register any transfer of the Shares not made in
accordance with the provisions of Regulation S, pursuant to an effective
registration statement under the 1933 Act or pursuant to an available exemption
from, or in a transaction not subject to, the registration requirements of the
1933 Act;

 

(c)

the decision to execute this Subscription and purchase the Shares agreed to be
purchased hereunder has not been based upon any oral or written representation
as to fact or otherwise made by or on behalf of the Company and such decision is
based solely upon a review of information as provided by the Company in the
Private Placement Memorandum of the Company dated June 4, 2007 (the "Private
Placement Memorandum"), the receipt and sufficiency of which is hereby
acknowledged by the Subscriber, and the publicly available information regarding
the Company available on the website of the United States Securities and
Exchange Commission (the "SEC") available at www.sec.gov (collectively, the
"Company Information"). The Subscriber acknowledges that the business plan,
corporate profile and any projections or predictions contained in the Private
Placement Memorandum may not be achieved or be achievable;

 

(d)

the Subscriber and the Subscriber's advisor(s) have had a reasonable opportunity
to review the Company Information and to ask questions of and receive answers
from the

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 3 -

 

Company regarding the Offering, and to obtain additional information, to the
extent possessed or obtainable without unreasonable effort or expense, necessary
to verify the accuracy of the information contained in the Company Information,
or any other document provided to the Subscriber;

 

(e)

the books and records of the Company were available upon reasonable notice for
inspection, subject to certain confidentiality restrictions, by the Subscriber
during reasonable business hours at its principal place of business and that all
documents, records and books pertaining to this Offering have been made
available for inspection by the Subscriber, the Subscriber's attorney and/or
advisor(s);

 

(f)

by execution hereof the Subscriber has waived the need for the Company to
communicate its acceptance of the purchase of the Shares pursuant to this
Subscription;

 

(g)

the Company is entitled to rely on the representations and warranties and the
statements and answers of the Subscriber contained in this Subscription and the
Subscriber will hold harmless the Company from any loss or damage it may suffer
as a result of the Subscriber's failure to correctly complete this Subscription;

 

(h)

the Subscriber will indemnify and hold harmless the Company and, where
applicable, its respective directors, officers, employees, agents, advisors and
shareholders from and against any and all loss, liability, claim, damage and
expense whatsoever (including, but not limited to, any and all fees, costs and
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any claim, lawsuit, administrative proceeding or investigation whether
commenced or threatened) arising out of or based upon any acknowledgment,
representation or warranty of the Subscriber contained herein or in any other
document furnished by the Subscriber to the Company in connection herewith,
being untrue in any material respect or any breach or failure by the Subscriber
to comply with any covenant or agreement made by the Subscriber to the Company
in connection therewith;

 

(i)

the issuance and sale of the Shares to the Subscriber will not be completed if
it would be unlawful or if, in the discretion of the Company acting reasonably,
it is not in the best interests of the Company;

 

(j)

the Subscriber has not acquired the Shares as a result of, and will not itself
engage in, any "directed selling efforts" (as defined in Regulation S under the
1933 Act) in the United States in respect of any of the Shares which would
include any activities undertaken for the purpose of, or that could reasonably
be expected to have the effect of, conditioning the market in the United States
for the resale of any of the Shares; provided, however, that the Subscriber may
sell or otherwise dispose of any of the Shares pursuant to registration of any
of the Shares pursuant to the 1933 Act and any applicable state securities laws
or under an exemption from such registration requirements and as otherwise
provided herein;

 

(k)

the Subscriber is outside the United States when receiving and executing this
Subscription and is acquiring the Shares as principal for its own account, for
investment purposes only, and not with a view to, or for, resale, distribution
or fractionalization thereof, in whole or in part, and no other person has a
direct or indirect beneficial interest in such Shares;

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 4 -

 

 

 

(l)

none of the Shares may be offered or sold to a U.S. Person or for the account or
benefit of a U.S. Person (other than a distributor) prior to the end of the
expiration of a period of one year after the date of original issuance of the
Shares;

 

(m)

the statutory and regulatory basis for the exemption claimed for the offer and
sale of the Shares, although in technical compliance with Regulation S, would
not be available if the offering is part of a plan or scheme to evade the
registration provisions of the 1933 Act;

 

(n)

the Subscriber has been advised to consult its own legal, tax and other advisors
with respect to the merits and risks of an investment in the Shares and with
respect to applicable resale restrictions and it is solely responsible (and the
Company is in any way responsible) for compliance with applicable resale
restrictions;

 

(o)

the Shares are not listed on any stock exchange or automated dealer quotation
system and no representation has been made to the Subscriber that any of the
Shares will become listed on any stock exchange or automated dealer quotation
system, except that currently certain market makers make market in the shares of
the Company's common stock on the OTC Bulletin Board;

 

(p)

neither the SEC nor any other securities commission or similar regulatory
authority has reviewed or passed on the merits of the Shares;

 

(q)

no documents in connection with this Offering have been reviewed by the SEC or
any state securities administrators;

 

(r)

there is no government or other insurance covering any of the Shares; and

 

(s)

this Subscription is not enforceable by the Subscriber unless it has been
accepted by the Company, and the Subscriber acknowledges and agrees that the
Company reserves the right to reject any Subscription for any reason.

5.

Representations, Warranties and Covenants of the Subscriber

5.1                          The Subscriber hereby represents and warrants to
and covenants with the Company (which representations, warranties and covenants
shall survive the Closing Date) that:

 

(a)

the Subscriber is not a U.S. Person;

 

(b)

the Subscriber is not acquiring the Shares for the account or benefit of,
directly or indirectly, any U.S. Person;

 

(c)

the Subscriber is resident in the jurisdiction set out on page 10 of this
Subscription;

 

(d)

the issuance of the Shares to the Subscriber as contemplated by the delivery of
this Agreement, the acceptance of it by the Company and the issuance of the
Shares to the Subscriber complies with all applicable laws of the Subscriber's
jurisdiction of residence or domicile and will not cause the Company to become
subject to or comply with any disclosure, prospectus or reporting requirements
under any such applicable laws;

 

(e)

the Subscriber:

 

(i)

is knowledgeable of, or has been independently advised as to, the applicable
securities laws of the securities regulators having application in the
jurisdiction in

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 5 -

 

which the Subscriber is resident (the “International Jurisdiction”) which would
apply to the acquisition of the Shares,

 

(ii)

is purchasing the Shares pursuant to exemptions from prospectus or equivalent
requirements under applicable securities laws or, if such is not applicable, the
Subscriber is permitted to purchase the Shares under the applicable securities
laws of the securities regulators in the International Jurisdiction without the
need to rely on any exemptions,

 

(iii)

acknowledges that the applicable securities laws of the authorities in the
International Jurisdiction do not require the Company to make any filings or
seek any approvals of any kind whatsoever from any securities regulator of any
kind whatsoever in the International Jurisdiction in connection with the issue
and sale or resale of the Shares, and

 

(iv)

represents and warrants that the acquisition of the Shares by the Subscriber
does not trigger:

 

A.

any obligation to prepare and file a prospectus or similar document, or any
other report with respect to such purchase in the International Jurisdiction, or

 

B.

any continuous disclosure reporting obligation of the Company in the
International Jurisdiction, and

the Subscriber will, if requested by the Company, deliver to the Company a
certificate or opinion of local counsel from the International Jurisdiction
which will confirm the matters referred to in subparagraphs (ii), (iii) and (iv)
above to the satisfaction of the Company, acting reasonably;

 

(f)

the Subscriber is acquiring the Shares as principal for investment only and not
with a view to, or for, resale, distribution or fractionalization thereof, in
whole or in part, and, in particular, it has no intention to distribute either
directly or indirectly any of the Shares in the United States or to U.S.
Persons;

 

(g)

the Subscriber is outside the United States when receiving and executing this
Subscription;

 

(h)

the Subscriber has received and carefully read this Subscription;

 

(i)

the Subscriber understands and agrees not to engage in any hedging transactions
involving any of the Shares unless such transactions are in compliance with the
provisions of the 1933 Act and in each case only in accordance with applicable
state securities laws;

 

(j)

the Subscriber acknowledges that it has not acquired the Shares as a result of,
and will not itself engage in, any "directed selling efforts" (as defined in
Regulation S under the 1933 Act) in the United States in respect of any of the
Shares which would include any activities undertaken for the purpose of, or that
could reasonably be expected to have the effect of, conditioning the market in
the United States for the resale of any of the Shares; provided, however, that
the Subscriber may sell or otherwise dispose of any of the Shares pursuant to
registration of any of the Shares pursuant to the 1933 Act and any applicable

 

CW1239517.1

--------------------------------------------------------------------------------

- 6 -

 

 

state securities laws or under an exemption from such registration requirements
and as otherwise provided herein;

 

(k)

the Subscriber has the legal capacity and competence to enter into and execute
this Subscription and to take all actions required pursuant hereto and, if the
Subscriber is a corporation, it is duly incorporated and validly subsisting
under the laws of its jurisdiction of incorporation and all necessary approvals
by its directors, shareholders and others have been obtained to authorize
execution and performance of this Subscription on behalf of the Subscriber;

 

(l)

the Subscriber (i) has adequate net worth and means of providing for its current
financial needs and possible personal contingencies, (ii) has no need for
liquidity in this investment, and (iii) is able to bear the economic risks of an
investment in the Shares for an indefinite period of time, and can afford the
complete loss of such investment;

 

(m)

the Subscriber understands and agrees that the Company and others will rely upon
the truth and accuracy of the acknowledgements, representations, warranties,
covenants and agreements contained in this Subscription and agrees that if any
of such acknowledgements, representations and agreements are no longer accurate
or have been breached, the Subscriber shall promptly notify the Company;

 

(n)

the Subscriber is aware that an investment in the Company is speculative and
involves certain risks, including the possible loss of the investment;

 

(o)

the entering into of this Subscription and the transactions contemplated hereby
do not result in the violation of any of the terms and provisions of any law
applicable to, or, if applicable, the constating documents of, the Subscriber,
or of any agreement, written or oral, to which the Subscriber may be a party or
by which the Subscriber is or may be bound;

 

(p)

the Subscriber has duly executed and delivered this Subscription and it
constitutes a valid and binding agreement of the Subscriber enforceable against
the Subscriber;

 

(q)

the Subscriber has the requisite knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of the
investment in the Shares and the Company;

 

(r)

the Subscriber understands and agrees that the Company and others will rely upon
the truth and accuracy of the acknowledgements, representations and agreements
contained in this Subscription, and agrees that if any of such acknowledgements,
representations and agreements are no longer accurate or have been breached, the
Subscriber shall promptly notify the Company;

 

(s)

all information contained in this Subscription is complete and accurate and may
be relied upon by the Company, and the Subscriber will notify the Company
immediately of any material change in any such information occurring prior to
the Closing Date;

 

(t)

the Subscriber is purchasing the Shares for its own account for investment
purposes only and not for the account of any other person and not for
distribution, assignment or resale to others, and no other person has a direct
or indirect beneficial interest is such Shares, and the Subscriber has not
subdivided his interest in the Shares with any other person;

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 7 -

 

 

 

(u)

the Subscriber is not an underwriter of, or dealer in, the shares of the
Company's common stock, nor is the Subscriber participating, pursuant to a
contractual agreement or otherwise, in the distribution of the Shares;

 

(v)

the Subscriber has made an independent examination and investigation of an
investment in the Shares and the Company and has depended on the advice of its
legal and financial advisors and agrees that the Company will not be responsible
in anyway whatsoever for the Subscriber's decision to invest in the Shares and
the Company;

 

(w)

if the Subscriber is acquiring the Shares as a fiduciary or agent for one or
more investor accounts, the Subscriber has sole investment discretion with
respect to each such account, and the Subscriber has full power to make the
foregoing acknowledgements, representations and agreements on behalf of such
account;

 

(x)

the Subscriber is not aware of any advertisement of any of the Shares and is not
acquiring the Shares as a result of any form of general solicitation or general
advertising including advertisements, articles, notices or other communications
published in any newspaper, magazine or similar media or broadcast over radio or
television, or any seminar or meeting whose attendees have been invited by
general solicitation or general advertising; and

 

(y)

no person has made to the Subscriber any written or oral representations:

 

(i)

that any person will resell or repurchase any of the Shares,

 

(ii)

that any person will refund the purchase price of any of the Shares,

 

(iii)

as to the future price or value of any of the Shares, or

 

(iv)

that any of the Shares will be listed and posted for trading on any stock
exchange or automated dealer quotation system or that application has been made
to list and post any of the Shares of the Company on any stock exchange or
automated dealer quotation system, except that currently certain market makers
make market in the shares of the Company's common stock on the OTC Bulletin
Board.

5.2                          In this Subscription, the term "U.S. Person" shall
have the meaning ascribed thereto in Regulation S promulgated under the 1933 Act
and for the purpose of the Subscription includes any person in the United
States.

6.

Acknowledgement and Waiver

6.1                          The Subscriber has acknowledged that the decision
to purchase the Shares was solely made on the Company Information. The
Subscriber hereby waives, to the fullest extent permitted by law, any rights of
withdrawal, rescission or compensation for damages to which the Subscriber might
be entitled in connection with the distribution of any of the Shares.

7.

Representations and Warranties will be Relied Upon by the Company

7.1                          The Subscriber acknowledges that the
acknowledgements, representations and warranties contained herein are made by it
with the intention that they may be relied upon by the Company and its legal
counsel in determining the Subscriber's eligibility to purchase the Shares under
applicable securities legislation, or (if applicable) the eligibility of others
on whose behalf it is contracting hereunder to

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 8 -

 

purchase the Shares under applicable securities legislation. The Subscriber
further agrees that by accepting delivery of the certificates representing the
Shares, it will be representing and warranting that the acknowledgements
representations and warranties contained herein are true and correct as of the
date hereof and will continue in full force and effect notwithstanding any
subsequent disposition by the Subscriber of such Shares.

8.

Resale Restrictions

8.1                          The Subscriber acknowledges that any resale of the
Shares will be subject to resale restrictions contained in the securities
legislation applicable to the Subscriber or proposed transferee. The Subscriber
acknowledges that the Shares have not been registered under the 1933 Act or the
securities laws of any state of the United States. The Shares may not be offered
or sold in the United States unless registered in accordance with federal
securities laws and all applicable state securities laws or exemptions from such
registration requirements are available.

9.

Legending and Registration of Subject Shares

9.1                          The Subscriber hereby acknowledges that upon the
issuance thereof, and until such time as the same is no longer required under
the applicable securities laws and regulations, the certificates representing
any of the Shares will bear a legend in substantially the following form:

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION
TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION
S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").

NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933
ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE
OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED
HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN
EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED
BY REGULATION S UNDER THE 1933 ACT.

9.2                          The Subscriber hereby acknowledges and agrees to
the Company making a notation on its records or giving instructions to the
registrar and transfer agent of the Company in order to implement the
restrictions on transfer set forth and described in this Subscription.

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 9 -

 

 

10.

Costs

10.1                       The Subscriber acknowledges and agrees that all costs
and expenses incurred by the Subscriber (including any fees and disbursements of
any special counsel retained by the Subscriber) relating to the purchase of the
Shares shall be borne by the Subscriber.

11.

Governing Law

11.1                       This Subscription is governed by the laws of the
State of Texas and the federal laws of the United States applicable thereto. The
Subscriber, in its personal or corporate capacity and, if applicable, on behalf
of each beneficial purchaser for whom it is acting, irrevocably attorns to the
exclusive jurisdiction of the Courts of the State of Texas.

12.

Survival

12.1                       This Subscription, including without limitation the
representations, warranties and covenants contained herein, shall survive and
continue in full force and effect and be binding upon the parties hereto
notwithstanding the completion of the purchase of the Shares by the Subscriber
pursuant hereto.

13.

Assignment

13.1

This Subscription is not transferable or assignable.

14.

Severability

14.1                       The invalidity or unenforceability of any particular
provision of this Subscription shall not affect or limit the validity or
enforceability of the remaining provisions of this Subscription.

15.

Entire Agreement

15.1                       Except as expressly provided in this Subscription and
in the agreements, instruments and other documents contemplated or provided for
herein, this Subscription contains the entire agreement between the parties with
respect to the sale of the Shares and there are no other terms, conditions,
representations or warranties, whether expressed, implied, oral or written, by
statute or common law, by the Company or by anyone else.

16.

Notices

16.1                       All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Subscriber
shall be directed to the address on page 10 and notices to the Company shall be
directed to it at the first page of this Subscription.

17.

Counterparts and Electronic Means

17.1                       This Subscription may be executed in any number of
counterparts, each of which, when so executed and delivered, shall constitute an
original and all of which together shall constitute one instrument. Delivery of
an executed copy of this Subscription by electronic facsimile transmission or
other means of electronic communication capable of producing a printed copy will
be deemed to be execution and delivery of this Subscription as of the date
hereinafter set forth.

 

CW1239517.1

 

--------------------------------------------------------------------------------

- 10 -

 

 

IN WITNESS WHEREOF the Subscriber has duly executed this Subscription as of the
date hereinafter set forth.

DELIVERY AND REGISTRATION INSTRUCTIONS

1.

Delivery - please deliver the Share certificates to:

                                          
                                          
                                                                           

                                          
                                          
                                                                           

 

2.

Registration - registration of the certificates which are to be delivered at
closing should be made as follows:

                                          
                                          
                                                                           

(name)

                                          
                                          
                                                                           

(address)

3.

The undersigned hereby acknowledges that he or she will deliver to the Company
all such additional completed forms in respect of the Subscriber's purchase of
the Shares as may be required for filing with the appropriate securities
commissions and regulatory authorities.

                                          
                                      

(Name of Subscriber – Please type or print)

                                                                               

(Signature and, if applicable, Office)

                                                                               

(Address of Subscriber)

                                                                               

(City, State, and Zip Code of Subscriber)

                                                                               

(Country of Subscriber)

                                                                               

(Fax Number)

                                                                               

(Number of Shares to be Purchased)

                                                                               

(Total Subscription Price)

 

CW1239517.1

 

--------------------------------------------------------------------------------

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A C C E P T A N C E

The above-mentioned Subscription in respect of the Shares is hereby accepted by
ARKANOVA ENERGY CORPORATION.

DATED at ______________________________, the _____ day of __________________,
2007.

ARKANOVA ENERGY CORPORATION

 

 

Per:

_________________________________

 

Authorized Signatory

 

 

 

CW1239517.1

 

 

 

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