EXHIBIT 10.40

                               PURCHASE AGREEMENT
                            (Gaywood Oil & Gas, LLC)

         This  Purchase  Agreement  (the  "Agreement")  is made and entered into
effective the 28th day of August,  2003, (the "Effective  Date"), by and between
10300 GAYWOOD TRUST ("Seller") and GREENBRIAR CORPORATION,  a Nevada corporation
("Purchaser").

                                    RECITALS

         A. Seller owns 100% of the membership interest  ("Interest") of Gaywood
Oil & Gas, LLC, a Nevada limited liability company ("Company").

         B.  Seller  desires  to sell to  Purchaser,  and  Purchaser  desires to
purchase from Seller,  the Interest upon the terms and subject to the conditions
of this Agreement.

                                    ARTICLE 1

                                  TERMS OF SALE
                                  -------------

1.1      Purchase  and Sale of  Interest.  Subject  to the terms and  conditions
         specified in this  Agreement,  Seller  shall sell,  to  Purchaser,  and
         Purchaser  shall  purchase  from  Seller,  at the  Closing,  all of the
         Interest.

1.2      Purchase Price. The total purchase price ("Purchase  Price") to be paid
         by  Purchaser  to Seller for the  Interest  shall be TWO  MILLION  FOUR
         HUNDRED  SIX   THOUSAND   EIGHT   HUNDRED   FIFTYAND   NO/100   DOLLARS
         ($2,406,850.00)  payable  by  assignment  to  Seller  of  a  California
         Statewide Communities Development Authority Refunding Housing Authority
         Revenue Bond (Crowne Pointe  Project)  Subordinate  Series 2002F-S (the
         "Bond").

1.3      Brokerage  Commission.  Purchaser  shall  indemnify  and hold  harmless
         Seller from and against all liabilities,  costs,  damages, and expenses
         (including  reasonable  attorneys'  fees),  arising from any claims for
         brokerage  commissions  or other  similar fees in  connection  with the
         transactions  covered by this Agreement insofar as such claims shall be
         based upon alleged  arrangements  or agreements made by Purchaser or on
         Purchaser's  behalf Seller shall indemnify and hold harmless  Purchaser
         from  and  against  all  liabilities,   costs,   damages  and  expenses
         (including  reasonable  attorneys'  fees),  arising from any claims for
         brokerage  commissions,  or other similar fees in  connection  with the
         transactions  covered by this Agreement insofar as such claims shall be
         based upon  alleged  arrangements  or  agreements  made by Seller or on
         Seller's  behalf  Such  indemnities  shall  survive  the Closing or any
         termination of the Agreement and not be merged therein.

<PAGE>


1.4      Cost  of  Transaction.  Whether  or not the  transactions  contemplated
         hereby shall be consummated, the parties agree as follows:

         a.       Seller  will pay the  fees,  expenses,  and  disbursements  of
                  Seller  and  its  agents,  representatives,  accountants,  and
                  counsel  incurred in connection with the subject matter hereof
                  and any amendments hereto; and

         b.       Purchaser shall pay the fees,  expenses and  disbursements  of
                  Purchaser  and  its  agents,  representative,   accounts,  and
                  counsel  incurred in connection with the subject matter hereof
                  and any amendments hereto.

1.5      Adjustments  and  Prorations.  Income  and  expenses,  related  to  the
         Company,  that are  credited or received  after  August 1, 2003,  shall
         become the property or obligation of the Purchaser.

                                    ARTICLE 2

                   REPRESENTATIONS AND WARRANTIES OF PURCHASER
                   -------------------------------------------

         As a material  inducement  to Seller to enter into this  Agreement  and
perform its obligations  hereunder,  Purchaser represents and warrants to Seller
as follows as of the date hereof and as of the Closing:

2.1      Authority.  Purchaser  has full power and  authority to enter into this
         Agreement and to perform its  obligations  under this Agreement and the
         Guaranty.  This  Agreement  constitutes  a legal,  valid,  and  binding
         obligation  of  Purchaser  and  is  enforceable  against  Purchaser  in
         accordance with its terms.

2.2      Ownership  of  Interest.  Purchaser,  or its  subsidiaries  or  related
         entities,  is the beneficial owner of all of the Bond. The Bond has not
         been pledged to any other party,  and no other party has any  ownership
         interest, security interest, or other claim to the Bond.

2.3      Absence of Conflicts.  The execution and delivery of this  Agreement by
         Purchaser  does not, and the  performance  by Purchaser of  Purchaser's
         obligation under this Agreement will not:

         a.       Violate any term or provision  of any law or any order,  writ,
                  or judgment applicable to Purchaser;

         b.       Conflict  with or  result  in a  violation  or  breach  of, or
                  constitute (with or without notice or lapse of time or both) a
                  default under any of the terms,  conditions,  or provisions of
                  the  articles or  certificate  of  incorporation  or bylaws of
                  Purchaser;

<PAGE>

         c.       Result  in the  creation  or  imposition  of any lien or other
                  encumbrance  upon  Purchaser or any of  Purchaser's  assets or
                  properties  that  individually  or in the  aggregate  with any
                  other liens or encumbrances  has or may reasonably be expected
                  to  have  a  material   adverse  effect  on  the  validity  or
                  enforceability   of  this  Agreement  or  on  the  ability  of
                  Purchaser  to  perform  Purchaser's   obligations  under  this
                  Agreement; or

         d.       Conflict  with or  result  in a  violation  or  breach  of, or
                  constitute (with or without notice or lapse of time or both) a
                  default  under,  or give to any  person or entity any right of
                  termination, cancellation, acceleration, or modification in or
                  with respect to, any contract to which Purchaser is a party or
                  by which any of Purchaser's assets or properties may be bound,
                  and as to which  any  such  conflicts,  violations,  breaches.
                  defaults,  or rights  individually or in the aggregate have or
                  may  reasonably be expected to have a material  adverse effect
                  on the validity or  enforceability of this Agreement or on the
                  ability of Purchaser to perform Purchaser's  obligations under
                  this Agreement.

                                    ARTICLE 3

                    REPRESENTATIONS AND WARRANTIES OF SELLER
                    ----------------------------------------

         As a material  inducement to Purchaser to enter into this Agreement and
perform its obligation hereunder, Seller represents and warrants to Purchaser as
follows as of the date hereof and as of the Closing Date:

3.1      Authority.  Seller  has full  power and  authority  to enter  into this
         Agreement and to perform its  obligations  under this  Agreement.  This
         Agreement  constitutes a legal,  valid and binding obligation of Seller
         and is enforceable against Seller in accordance with its terms.

3.2      Ownership of Interest. Seller, or its subsidiaries or related entities,
         is the beneficial  owner of all of the issued and outstanding  Interest
         in the Company.  No other party has any  ownership  interest,  security
         interest, or other claim to the Interest.

3.3      Taxes. Seller has filed on a timely basis all federal,  state,  county,
         local,  and foreign tax returns  which are required to be filed and has
         paid,  or  adequately  reserved  for,  all such  taxes and there are no
         proposed  deficiencies  in any such  taxes.  There  are no  outstanding
         consents executed by Seller extending the period of limitations for the
         assessment or collection of any such taxes.

3.4      All rights  pursuant to the  representations  and warranties  contained
         herein shall survive the Closing. If each and every  representation and
         warranty  contained  herein  shall not be true in all  respects  on the
         Closing  Date or if Seller  shall have  failed to  perform  any term or
         condition  hereof  required to be  performed by Seller on or before the
         Closing Date,  Purchaser shall have the right to close this transaction
         without  relieving Seller of its obligation,  if any, to pay damages on

<PAGE>

         account  of  the  foregoing;  or  Purchaser  may  terminate  all of its
         obligations hereunder,  which termination shall be without prejudice to
         the rights of Purchaser, if any, to recover damages. If Purchaser shall
         terminate  its  obligations  hereunder,  the Deposit  shall be promptly
         returned to Purchaser.

                                    ARTICLE 4

                         CONDITIONS PRECEDENT TO CLOSING
                         -------------------------------

5.1      Conditions  Precedent to  Obligations  of Seller.  The  obligations  of
         Seller  hereunder  are,  at  the  option  of  Seller,  subject  to  and
         conditioned  upon the  satisfaction  and fulfillment on or prior to the
         Closing Date (or other time period  referenced  herein,  if earlier) of
         each of the following conditions unless waived in writing by Seller:

         a.       Payment of Purchase  Price.  Purchaser shall have delivered to
                  Seller payment in the amount of the Purchase Price.

         b.       Affirmation   of   Representations    and   Warranties.    The
                  representations  and warranties of Purchaser contained in this
                  Agreement shall be true and correct when made and on and as of
                  the Closing Date as though such representations and warranties
                  had been made on and as of such Closing Date, and Seller shall
                  not  have  discovered  any  material  error,  misstatement  or
                  omission therein.

         c.       Compliance with Agreement.  Purchaser shall have performed and
                  complied with all  agreements  or conditions  required by this
                  Agreement to be performed and complied with by Purchaser prior
                  to or on the Closing Date.

5.2      Conditions  Precedent to Obligations of Purchaser.  The  obligations of
         Purchaser  hereunder  are, at the option of  Purchaser,  subject to and
         conditioned  upon the  satisfaction  and fulfillment on or prior to the
         Closing Date (or such other time period referenced  herein, if earlier)
         of each  of the  following  conditions  unless  waived  in  writing  by
         Purchaser:

         a.       Compliance  with  Agreement.  Seller shall have  performed and
                  complied with all  agreements  or conditions  required by this
                  Agreement to be performed and complied with by Seller prior to
                  or on the  Closing  Date,  including,  but not limited to, the
                  assignment   to  transfer  and  delivery  to  Purchaser  of  a
                  certificate or certificates  representing  the Interest,  duly
                  endorsed  in  blank,  or  accompanied  by  stock  powers  duly
                  endorsed in blank, with signatures duly witnessed thereon.

         b.       Good  Standing/Taxes.  The Company shall be in good  standing.
                  having paid all franchise taxes.

<PAGE>

         c.       Affirmation   of   Representations    and   Warranties.    The
                  representations  and  warranties  of Seller  contained in this
                  Agreement shall be true and correct when made and on and as of
                  the Closing Date as though such representations and warranties
                  had been made on and as of such Closing  Date,  and  Purchaser
                  shall not have discovered any material error,  misstatement or
                  omission therein.

         d.       Legal Actions or Proceedings.  No actions or proceeding before
                  a court or any other  governmental  agency or body  shall have
                  been  instituted  or  threatened  to restrain or prohibit  the
                  consummation of the transactions  herein contemplated or which
                  would  in  any  material  way  affect  the  Interest,  and  no
                  governmental  agency or body shall have taken any other action
                  or made any request of Seller or Purchaser  which would have a
                  material  adverse  effect  on  the  transactions  contemplated
                  hereby.

                                    ARTICLE 5

                                     CLOSING
                                     -------

6.1      Closing.  The consummation of the sale and purchase of Interest and the
         other  transactions  contemplated  by and  described in this  Agreement
         shall take place at a closing  ("Closing") to be held at the offices of
         Seller, or another location mutually  agreeable to Seller and Purchaser
         on the same date that Seller receives Board approval.

6.2      Actions of Seller at Closing.  At the Closing,  Seller shall deliver or
         cause to be delivered to Purchaser, the following:

         a.       A  certificate  (or a duplicate  of a  certificate  reasonably
                  satisfactory  to  purchaser)  representing  the Interest to be
                  sold by Seller to Purchaser  pursuant to this Agreement,  duly
                  endorsed  in  blank,  or  accompanied  by  stock  powers  duly
                  endorsed in blank;

         b.       Such other  instruments and documents as Purchaser  reasonably
                  deems necessary to effect the transactions contemplated hereby
                  and to place Purchaser in legal and operational  possession of
                  the Company including, without limitation, all corporate books
                  and records of the Company in the possession of Seller; and

         c.       From  time  to  time  after   Closing  and   without   further
                  consideration,  Seller  shall  execute and deliver  such other
                  instruments  of conveyance  and transfer,  and take such other
                  actions  as  Purchaser   reasonably   may  request,   to  more
                  effectively   convey,  and  transfer  full  right,  title  and
                  interest to, vest in, and place  Purchaser in legal and actual
                  possession of, any and all of the Interest conveyed hereunder.


<PAGE>

                                    ARTICLE 6

                                     DEFAULT
                                     -------

7.1      Purchaser's  Default.  If Purchaser  refuses or fails to consummate the
         purchase  of the  Interest  pursuant to this  Agreement  for any reason
         (other than  pursuant to a right  granted to Purchaser  hereunder to do
         so) or  otherwise  defaults  hereunder,  Seller shall have the right to
         terminate this Agreement  without further  liability of either party as
         its  sole  and  exclusive  remedy.  This  shall  be  Seller's  sole and
         exclusive remedy hereunder.

7.2      Seller's  Default.  If Seller wrongfully fails to close the transaction
         contemplated  by this  Agreement,  or  otherwise  wrongfully  fails  to
         perform any of its obligations or agreements hereunder, either prior to
         or at Closing,  Purchaser may terminate this Agreement  without further
         liability of either party as its sole and exclusive remedy.

7.3      Notice and Cure. As a condition  precedent to the effective exercise of
         remedies under this section,  a party wishing to exercise such remedies
         shall give notice to the other party in writing, in accordance with the
         notice provisions of this Agreement, which notice shall (a) state, with
         particularity,  the alleged breach or default or  nonperformance of the
         defaulting  party and the action required to cure such breach,  and (b)
         contain a statement of intent to specific remedies available under this
         Agreement if the breach remains  uncured.  The  defaulting  party shall
         have a period  often (10) days after such notice is given in which time
         to cure the alleged default, breach or nonperformance.

                                    ARTICLE 7

                                     GENERAL
                                     -------

8.1      Legal  Fees and  Costs.  In the event any party  elects to incur  legal
         expenses to enforce any  provision of this  Agreement,  the  prevailing
         party will be  entitled  to  recover  such  legal  expenses,  including
         without  limitation,  reasonable  attorneys'  fees, costs and necessary
         disbursements,  in  addition  to any other  relief to which  such party
         shall be entitled.

8.2      Choice of Law and Venue.  The parties agree that this Agreement is made
         and entered into and is performable in Dallas County,  Texas, and shall
         be governed by and construed in  accordance  with the laws of the State
         of  Texas,  and  that  any  litigation,  special  proceedings  or other
         proceedings as between the parties that may be brought or arise out of,
         in connection  with or by reason of this Agreement  shall be brought in
         the applicable Federal or State Court in and for Dallas County,  Texas,
         which courts shall be the exclusive courts of jurisdiction and venue.

8.3      Severability.  In the event any provision of this  Agreement is held to
         be invalid,  illegal or unenforceable for any reason and in any respect
         by a court of competent  jurisdiction,  such invalidity,  illegality or
         unenforceability  shall in no event  affect,  prejudice  or disturb the
         validity of the  remainder  of this  Agreement,  which shall be in full
         force  and  effect,  enforceable  in  accordance  with its  terms.  The
         provision held to be void, illegal or unenforceable shall be limited so
         that it shall remain in effect to the extent permissible by law.

<PAGE>

8.4      Entire   Agreement.    This   Agreement   supersedes   all   prior   or
         contemporaneous   agreements,  oral  or  written  between  the  parties
         concerning  the Interest and the Company,  and  constitutes  the entire
         agreement between the parties  respecting the Interest and the Company;
         and no party shall be entitled to benefits  other than those  specified
         herein.  As between or among the parties,  no oral  statements or prior
         written material not specifically  incorporated  herein shall be of any
         force and effect. The parties specifically acknowledge that in entering
         into and executing this  Agreement,  the parties relied solely upon the
         representations  and  agreements  contained  in this  Agreement  and no
         others.  All prior or  contemporaneous  representations  or agreements,
         whether written or verbal, not expressly  incorporated herein are of no
         force or effect and no changes in or additions to this Agreement  shall
         be recognized unless and until made in writing by all parties hereto.

8.5      Amendment. No amendment, modification,  deletion, release, termination,
         extension of,  alteration,  variance or change in, or supplement to the
         provision of this  Agreement  shall be valid and effective or otherwise
         binding on the parties  hereto  unless or until such  amendment,  etc.,
         shall have been reduced to writing and  executed by the parties  hereto
         with the same formality as this Agreement.

8.6      Notices. All notices requests,  demands, and other communications under
         this  Agreement  shall be in  writing  and shall be deemed to have been
         duly given when delivered personally, when sent by confirmed facsimile,
         the next day if sent by  overnight  courier  service  or in three  days
         after being mailed by  certified or  registered  mail,  return  receipt
         requested,  with  postage  prepaid  to the  parties  at  the  following
         addresses  (or at such other  address for a party as shall be specified
         by like notice):

         a.       if to Seller, to: 10300 Gaywood Trust
                  1800 Valley View Lane, Suite 300
                  Dallas, Texas 75234
                  Attention:       Mr. Ken Joines
                  Telephone:       469-522-4366
                  Facsimile:       469-522-4360

or to such other person and place as the Seller  shall  direct the  Purchaser in
writing; or

         b.       if to Purchaser, to:
                  Greenbriar Corporation
                  14185 Dallas Parkway, Suite 650
                  Dallas, Texas 75254
                  Attention: Mr. Gene Bertcher
                  Telephone: 972-407-8400
                  Facsimile: 972-407-8420

or to such other  place and person as the  Purchaser  shall  direct to Seller in
writing.

<PAGE>

8.7      Waiver. Unless otherwise expressly provided herein, no waiver by Seller
         or Purchaser of any provision  hereof shall be deemed to have been made
         unless  expressed  in  writing  and signed by such  party.  No delay or
         omission in the  exercise of any right or remedy  accruing to Seller or
         Purchaser upon any breach under this Agreement  shall impair such right
         or remedy or be construed as a waiver of any such breach theretofore or
         thereafter occurring.

8.8      Successors and Assigns. This Agreement shall be binding upon, and shall
         inure to the benefit of, the parties hereto and their respective heirs,
         legal representatives, successors and permitted assigns.

8.9      Third Party Beneficiaries.  Nothing in this Agreement,  whether express
         or  implied,  shall be deemed to confer on any  person,  other than the
         parties hereto and their successors and permitted  assigns,  any right,
         obligation, remedy, or liability.

8.10     Headings.  Headings on the sections and  subsections  in this Agreement
         are  for  reference  purposes  only  and  shall  be  deemed  to have no
         substantive effect.

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

8.12     General  Disclaimer.  Purchaser and Seller agree that any actions taken
         under this  Agreement are subject to and will be superseded by any law,
         rule, regulation or requirement established by governmental agencies.

8.13     Further  Assurances.  After the  Closing,  the parties will execute and
         deliver a such powers of attorney, documents,  instruments, and Assets,
         and do all such other acts and things as may be reasonably necessary to
         carry out the provisions of this  Agreement.
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
         executed as of the Effective Date.



<PAGE>

SELLER:
                                            10300 GAYWOOD TRUST


                                            By: /s/ Gene E. Phillips
                                               ---------------------------
                                               Gene E. Phillips, Trustee


PURCHASER:
                                            GREENBRL&R CORPORATION,
                                            a Nevada corporation

                                            By: /s/ Oscar Smith
                                               ---------------------------
                                               Oscar Smith, Vice President