EnerJex Resources, Inc.

7300 W. 110th Street, 7th Floor

Overland Park, KS 66210

 

December 10, 2007

 

The Buyers of Senior Secured Debentures

of Midwest Energy, Inc. and Common Stock

of EnerJex Resources, Inc.

 

Dear Buyers:

 

Reference is made to the Securities Purchase Agreement (the “Purchase
Agreement”), the Registration Rights Agreement (the “RRA”), and the Pledge and
Security Agreement (the “Security Agreement”), all dated as of April 11, 2007,
by and among Midwest Energy, Inc. (the “Company”), EnerJex Resources, Inc.
(“Parent”) and the Buyers. Capitalized terms used but not otherwise defined
herein have the meanings ascribed to such terms in the Purchase Agreement, the
RRA and/or the Security Agreement.

 

Pursuant to the RRA, the Company is obligated to file the second Registration
Statement to register the Second Registration Amount (3,000,000 shares) of the
Closing Securities within six months and one day of the First Effectiveness
Date. The first Registration Statement was declared effective on August 14,
2007, which would make the Second Filing Deadline to be on or about February 18,
2008 and the Second Effectiveness Deadline to be on or about May 19, 2008.
Further, the Company is obligated to file a third Registration Statement within
six months and one day of the Second Effectiveness Date (approximately November
20, 2008).

 

The Company has agreed to accelerate the filing of the second Registration
Statement to be on or before December 31, 2007 in exchange for the Buyers
agreeing not to accelerate the Third Filing Deadline (i.e. – the Third Filing
Deadline would remain to be on or about November 20, 2008).

 

Pursuant to the Security Agreement, the Company and Parent pledged all of their
assets to the Buyers as Collateral for the repayment of the Debentures.

 

The Company has instituted a hedging and security policy to help stabilize its
cash flow. Pursuant to this policy, the Company may need to pledge a sufficient
amount of its oil production to satisfy requirements of entities the Company
plans to enter into hedging agreements with. As further consideration for
accelerating the filing of the second Registration Statement and to assist the
Company in stabilizing its cash flow, the Buyers have agreed to allow the
Company to pledge up to 150 barrels of oil per day (BOPD) of its production
through contracts put in place with hedging companies by June 30, 2008, pursuant
to which the Company will not hedge said production for a period to exceed 36
months without additional written consent of the Buyers. Further, the Buyers
agree to release the associated production from any lien the Buyers have on the
production. Only pledged production would be released and not considered
Collateral.

 

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This letter agreement shall be governed by the laws of the State of New York
without giving effect to any choice of law or conflict of law provision or rule
that would cause the application of the laws of any jurisdictions other than the
State of New York. Further, this letter agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.

 

 

Sincerely,

 

 

ENERJEX RESOURCES, INC.

 

 

By: /s/ Steve Cochennet 

 

Name: Steve Cochennet

 

Title: Chief Executive Officer

 

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Agreed to and accepted:

 

DKR SOUNDSHORE OASIS HOLDING FUND LTD., by DKR Oasis Management Company LP,

Its Investment Manager

 

By: /s/ Barbara Burger

 

Name: Barbara Burger

 

Title: Authorized Signatory

 

WEST COAST OPPORTUNITY FUND, LLC

 

By: /s/ Atticus Lowe

 

Name: Atticus Lowe

 

Title: Chief Investment Officer

 

ENABLE GROWTH PARTNERS LP

 

By: /s/ Brendan O’Neil

 

Name: Brendan O’Neil, CFA

 

Title: Principal and Portfolio Manager

 

ENABLE OPPORTUNITY PARTNERS LP

 

By: /s/ Brendan O’Neil

 

Name: Brendan O’Neil, CFA

 

Title: Principal and Portfolio Manager

 

GLACIER PARTNERS LP

 

By: /s/ Peter Castellanos

 

Name: Peter Castellanos

 

Title: Managing Partner

 

FREY LIVING TRUST

 

By: /s/ Philip Frey Jr.

 

Name: Philip Frey Jr.

 

Title: Trustee