LIMITED LIABILITY COMPANY MEMBERSIDP INTEREST PURCHASE AGREEMENT



LIMITED LIABILITY COMPANY MEMBERSHIP INTEREST PURCHASE AGREEMENT


 

THIS LIMITED LIABILITY COMPANY MEMBERSHIP INTEREST PURCHASE
AGREEMENT, dated as of October to, 2008,
by and among Northcut Holdings, LLC, a limited liability company organized under
the laws of the state of Utah ("Seller"), Interline Resources Corporation, a
corporation organized under the laws of the state of Utah ("Buyer") and Northcut
Refining, LLC, a limited liability company organized under the laws of Wyoming
("Northcut"). 

WHEREAS, Buyer desires to purchase from Seller and Seller desires
to sell to Buyer membership interests representing 100% of Seller's membership
interests as described in the Operating Agreement of Northcut Refining, LLC,
dated September 13, 2007 ("LLC Agreement"), on the terms and subject to the
conditions set forth herein.

 

NOW, THEREFORE, the parties agree as follows: 

1.
Purchase and Sale of Membership Interests. 

     1.1 Sale and Purchase. At the Closing,
Buyer shall purchase from Seller, and Seller shall sell and sell to Buyer, a 17%
membership interest in Northcut (the "Membership Interests"), for the purchase
price of One Million Five Hundred Thousand and Noll 00 Dollars ($1,500,000.00)
(the "Purchase Price"), and subject to the terms and conditions of this
Agreement and on the basis of the representations, warranties, covenants and
agreements contained herein (the "Sale and Purchase"). 

     1.2 Closing. The Sale and Purchase shall
take place on or before January 31, 2009 at the offices of Shumway -Van Law,
Chtd., 3400 North Ashton Boulevard, Suite 100B, Lehi, Utah 84043 (which time and
place are designated as the "Closing"). If the Closing does not occur prior to
January 31, 2009 then this Agreement shall be automatically terminated. 

     1.3 Deliveries at Closing. At the
Closing, the parties shall, respectively, make the following simultaneous
deliveries: 




         
(a) Seller shall deliver to Buyer duly executed documents conveying the
Membership Interests to Buyer, duly executed on behalf of Seller, and a cross
receipt, duly executed on behalf of Seller, indicating a receipt of the Purchase
Price from Buyer. 




         
(b) Buyer shall deliver to Seller the Purchase
Price, by wire transfer of immediately available funds to an account or accounts
designated by Seller, and a cross receipt, duly executed on behalf of Buyer,
indicating receipt of the Membership Interests from Seller. 




         
(c) The parties shall execute and deliver such other documents as are customary
and reasonably necessary to consummate the transactions contemplated hereby.





2.
Representations and Warranties of Seller. Seller hereby represents and warrants
as follows: 

     2.1 Organization and Qualification.
Seller is a limited liability company duly organized and validly existing under
the laws of the State of Utah. 

     2.3 Authorization. As of the Closing, all
action on the part of Seller, its officers and directors necessary for the
authorization, execution and delivery of this Agreement, and the performance of
all obligations of Seller hereunder shall have been taken, and this Agreement,
assuming due execution by the parties hereto and thereto, will constitute valid
and legally binding obligations of Seller, enforceable in accordance with their
respective terms. 

     2.4 Valid Issuance of Membership
Interests. The Membership Interests, when sold and delivered in accordance with
the terms of this Agreement for the consideration expressed herein, shall be
duly and validly issued and will be free of restrictions on transfer directly or
indirectly created by Seller other than restrictions on transfer under this
Agreement and under applicable state and federal securities laws. 

     2.5 Litigation. There are no actions,
suits, proceedings or investigations pending or, to the best of Seller's
knowledge, threatened before any court, administrative agency or other
governmental body against Seller which questions the validity of this Agreement
or the right of Seller to enter into it, or to consummate the transactions
contemplated hereby. 

     2.6 Compliance with Other Instruments.
Seller is not in violation or default of any provision of its Articles of
Organization or the LLC Agreement, each as in effect immediately prior to the
Closing. 

     2.7 Agreements; Actions. Except for
agreements described herein and in the LLC Agreement, there are no agreements,
understandings or proposed transactions between Seller and any of its officers,
directors, affiliates, or any affiliate thereof. 

    
2.8 No Implied Representations. Except as expressly set forth herein, Seller
makes no representations or warranties of any kind to Buyer. 




3.
Representations and Warranties of Buyer and Northcut. Buyer and Northcut hereby
jointly and severally represent and walTant that: 




     3.1 Experience. Buyer and Northcut are
experienced in evaluating transactions such as those described in this Agreement
and are able to fend for themselves in such transactions, have such knowledge
and experience in financial and business matters that Buyer and Northcut are
capable of evaluating the merits and risks of their prospective purchase of
Seller's membership interest in Northcut, and have the ability to bear the
economic risks of the investment. 

    
3.2 Investment. Buyer is acquiring the Membership Interests for investment for
its own account and not with the view to, or for resale in connection with, any
distribution thereof. Buyer and Northcut understand that the Membership
Interests have not been registered under the Securities Act or the Utah
Securities Law, by reason of a specific exemption from the registration
provisions of the Securities Act and the Utah Securities Law, respectively,
which 

depends upon,
among other things, the bona fide nature of the investment intent as expressed
herein. Buyer and Northcut further represent that they do not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
participation to any third person with respect to any of the Membership
Interests. Buyer and Northcut understand and acknowledge that the offering of
the Membership Interests pursuant to this Agreement will not be registered under
the Securities Act nor under the state securities laws on the ground that the
sale provided for in this Agreement and the issuance of securities hereunder is
exempt from the registration requirements of the Securities Act and any
applicable state securities laws. 

     3.4 No Public Market. Buyer and Northcut
understand that no public market now exists for the Membership Interests, and
that there may never be a public market for the Membership Interests. 

     3.6 Authorization. As of the Closing, all
action on the part of Buyer and Northcut, and their respective officers,
directors and partners necessary for the authorization, execution and delivery
of this Agreement and the LLC Agreement and the performance of all obligations
of Buyer and Northcut hereunder and there under shall have been taken, and this
Agreement and the LLC Agreement, assuming due execution by the parties hereto
and thereto, constitute valid and legally binding obligations of Buyer and
Northcut, enforceable in accordance with their respective terms. 

     3.7 Compliance with Other Instruments.
Neither Buyer nor Northcut is in violation or default of any provision of its
articles of organization or other organizational documents, as applicable, each
as in effect immediately prior to the Closing, except for such failures as would
not be reasonably expected to materially adversely effect the ability of Buyer
and Northcut to perform their respective obligations under this Agreement (a
"Buyer Material Adverse Effect"). Neither Buyer nor Northcut is in violation or
default of any provision of any material instrument, mortgage, deed of trust,
loan, contract, commitment, judgment, decree, order or obligation to which it is
a party or by which it or any of its properties or assets are bound which would
reasonably be expected to have a Buyer Material Adverse Effect. To the best of
its knowledge, neither Buyer nor Northcut is in violation or default of any
provision of any federal, state or local statute, rule or governmental
regulation which would reasonably be expected to have a Buyer Material Adverse
Effect. The execution, delivery and performance of and compliance with this
Agreement and the LLC Agreement will not result in any such violation, be in
conflict with or constitute, with or without the passage of time or giving of
notice, a default under any such provision, require any consent or waiver under
any such provision (other than any consents or waivers that have been obtained),
or result in the creation of any mortgage, pledge, lien, encumbrance or charge
upon any of the properties or assets of Buyer or Northcut pursuant to any such
provision. 

    
3.8 Accredited Investor. Each of Buyer and Northcut is an "accredited investor"
as defined in Rule 501 of Regulation D as promulgated by the Securities and
Exchange Commission under the Securities Act and shall submit to Seller such
further assurances of such status as may be reasonably requested by Seller. For
state securities law purposes, the principal address of both Buyer and Northcut
is 160 W. Canyon Crest Rd., Alpine, Utah 84004. 

 

4. Covenants.


    
4.1 Confidentiality. Seller, Buyer and Northcut, and their respective officers,
directors, partners and affiliates, agree to keep the terms and conditions of
this Agreement and the transactions contemplated hereby confidential, and agree
not to disclose to any party not a party to this Agreement or the LLC Agreement
any of the terms hereof, except as may be required by applicable law. 

 

5.
Miscellaneous. 

    
5.1 Governing Law. This Agreement shall be governed in all respects by the laws
of the State of Utah, without regard to any provisions thereof relating to
conflicts of laws among different jurisdictions. 

    
5.2 Survival. The representations and warranties made herein shall survive the
Closing for a period of one year, whereupon they shall cease and be of no
further force and effect. 

    
5.3 Successors and Assigns. Except as otherwise provided herein, the provisions
hereof shall inure to the benefit of, and be binding upon, the successors,
assigns, heirs, executors and administrators of the parties hereto; provided,
however, that the rights of Buyer to purchase the Membership Interests shall not
be assignable without the consent of Seller. This Agreement shall not be
construed so as to confer any right or benefit on any party not a patty hereto,
other than their respective successors, assigns, heirs, executors and
administrators. 

    
5.4 Entire Agreement; Amendment. This Agreement and the other documents
delivered pursuant hereto constitute the full and entire understanding and
agreement among the parties with regard to the subjects hereof and thereof and
supersedes all prior agreements and understandings relating thereto. Neither
this Agreement nor any term hereof may be amended, waived, discharged or
terminated other than by a written instrument signed by the patty against whom
enforcement of any such amendment, waiver, discharge or termination is sought.


    
5.5 Notices, Etc. All notices under this Agreement shall be sufficiently given
for all purposes if made in writing and delivered personally, sent by documented
overnight delivery service or, to the extent receipt is confirmed, facsimile or
other electronic transmission, to following addresses and numbers. 

Notices to
Seller shall be addressed to: 

Northcut
Holdings, LLC 486 West 50 North American Fork, Utah 84003 

with a copy to:


Shumway -Van
Law, Chtd. 3400 North Ashton Boulevard, Suite 100B Lehi, Utah 84043 Telephone:
(801) 216-8885 

Facsimile: (801)
216-8889 Attn: Douglas J. Shumway, Esq. 

or at
such other address and to the attention to such other person as Seller may
designate by written notice to Buyer and Northcut. Notices to Buyer and Northcut
shall be addressed to: 

160 W. Canyon
Crest Rd. Alpine, Utah 84004 Telephone: (801) 756-3031 Fax: (801) 756-8843 Attn:
Michael Williams 

or at
such other address and to the attention of such other person as Buyer and
Northcut may designate by written notice to Seller. 

     5.6 Delays or Omissions. No delay or
omission to exercise any right, power or remedy accruing to any party upon any
breach or default of the other party under this Agreement shall impair any such
right, power or remedy of such first party, nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of or in
any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
holder of any breach or default under this Agreement, or any waiver on the part
of any holder of any provisions or conditions of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in such
writing or as provided in this Agreement. 

     5.7 Expenses. Seller, Buyer and Northcut
shall each bear the expenses and legal fees incurred on their own behalf with
respect to this Agreement and the transactions contemplated hereby. 

     5.8 Counterparts. This Agreement may be
executed in any number of counterparts, each of which may be executed by only
one party, which shall be enforceable against the parties actually executing
such counterparts, and all of which together shall constitute one instrument.


     5.9 Severability; Enforcement. In the
event that any provision of this Agreement becomes or is declared by a court of
competent jurisdiction to be illegal, unenforceable or void, this Agreement
shall continue in full force and effect without such provision; provided that no
such severability shall be effective if it materially changes the economic
benefit of this Agreement to any party. The parties hereto agree that
irreparable damage for which money damages would not be an adequate remedy would
occur in the event that any of the provision of this Agreement were not
performed in accordance with its specific terms or was otherwise breached. It is
accordingly agreed that, in addition to any other remedies a party may have at
law or equity, the parties shall be entitled to seek an injunction of
injunctions to prevent such breached of this Agreement and to enforce
specifically the terms hereof.

 

IN WITNESS
WHEREOF, the parties have executed this Agreement as of the date first above
written. 

INTERLINE
RESOURCES CORPORATION

 NORTHCUT
HOLDINGS, LLC 

,/


Signature: /s/ Michael
Williams                                         
Signature: /s/ Michael R. Burke

By:  Michael Williams,
President                                       
By: Michael R. Burke, Manager