Document:

TURNKEY REWORK AGREEMENT

This Turnkey Rework Agreement effective MAY 10, 2011, is reached between the following parties:

SUCCESS OIL CO., INC. of 8306 Wilshire Blvd. #566, Beverly Hills, California 90211 hereinafter called ("SUCCESS”), and

ENERGY PRODUCERS, INC./DENNIS ALEXANDER/CEO, AND FURTHER THROUGH ITS WHOLLY OWNED SUBSIDIARY OF EGPI ENERGY PRODUCERS, INC., of 6564 SMOKE TREE LANE, TOWN OF PARADISE VALLEY, AZ. 85253 hereinafter called (collectively, "ENERGY PRODUCERS"), 

WHEREAS SUCCESS and ENERGY PRODUCERS have a leasehold interest in the Crawer #1 Well and the J.B. Tubb #18-1 Well, both wells located on the J.B. Tubb North 40 acres, Ward County, Texas, being more particularly described in attached Exhibit “A” and incorporated herein.

WHEREAS SUCCESS and ENERGY PRODUCERS have agreed that SUCCESS shall do certain reworking procedures described below on the Crawar #1 Well and the J.B. Tubb # 18-1 Well and thereafter be the Operator of said wells.

NOW THEREFORE, in consideration for the payment of $165,162.36 to SUCCESS by ENERGY PRODUCERS, or agents for ENERGY PRODUCERS, the parties hereto agree as follows:

A.  CRAWAR #1 WELL- SUCCESS shall drill out the cement plug and cast iron  bridge plug located at approximately 5,000 feet, and shall perforate the Glorieta  payzone at intervals ranging from 3,800 feet to 4,000 feet, acidize and swab.

B.  J.B. TUBB #18-1 WELL- SUCCESS shall re-perforate existing Tubb pay- zone at interval 4,510 feet to 4,560 feet (plus or minus) to increase perforations to  6 shots per foot and then frac with gas gun.

C.  It is agreed and understood that if the above described reworking costs exceed  $165,162.36, SUCCESS shall solely be responsible for such excess costs.

D.  It is agreed and understood that SUCCESS is to perform the above reworking  procedures in a good and workman like manner, using existing industries  standards, but SUCCESS does not guarantee specific production rates from either  well.

E.  SUCCESS shall be the operator of both wells, responsible for paying from production the expenses incurred through the operation of the subject wells, and overall day to day supervision, and report to state and federal legal authorities (Railroad Commission of Texas, E.P.A.) and be responsible for all compliance of environmental issues prescribed by law.  If requested by either SUCCESS or ENERGY PRODUCERS, the parties shall enter into an Operating Agreement concerning the subject wells.

  

  

  

F. SUCCESS shall begin the above described reworking within 14 days of receipt of $165,162.36 from funds escrowed with Charles C. Wright, Esq., as per Escrow Agreement effective MAY 10, 2011, by and between SUCCESS, ENERGY PRODUCERS and TWL INVESTMENTS, L.L.C.

G.  Neither this Agreement nor a future Operating Agreement entered into by SUCCESS and ENERGY PRODUCERS is intended to create nor shall the same be construed as creating a mining partnership commercial partnership or any other partnership or joint venture relationship.  Rather, it is the intent and purpose of this Agreement to create a relationship which is limited to the exploration, development, and extraction of oil and/or gas for division in kind, or for sale for the account of the Participant’s to this Agreement, individually, and in which the liability of each of the Participant’s shall be several and not joint or collective.  If for Federal Income Tax purposes this Agreement and the operations are regarded as a partnership, each Participant hereby affected elects to be excluded from the application from all of the provisions of Subchapter K, Chapter 1, Subtitle A of the Internal Revenue Code of 1986, as amended as permitted and authorized by Section 761 of the Code and the regulations promulgated thereunder.  SUCCESS is authorized and directed to execute on behalf of each Participant any evidence of this election as may be required.

H. SUCCESS agrees to provide to ENERGY PRODUCERS such information and reports as to the progress of the reworking of the wells as ENERGY PRODUCERS or its agents may reasonably require.

I.  Time is of the essence with respect to all matters governed by the terms of this Agreement.

J.  The rights and obligations created by this Agreement shall be governed by and interpreted under the laws of the State of Texas.

K.  All notices, requests, demands and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if sent by hand-delivery, by facsimile (followed by first-class mail), by nationally recognized overnight courier service or by prepaid registered or certified mail, return receipt requested, to the addresses set forth below:

If to the ENERGY PRODUCERS:

 

EGPI ENERGY PRODUCERS, Inc.

6564 Smoke Tree Lane

Scottsdale, AZ 85253

Attention:  DENNIS ALEXANDER C.E.O.

  

  

  

Facsimile No.: (480) 443-1403 480-948-6581 (Voice)

602-326-7371 (Cell)

 

If to SUCCESS:

 

SUCCESS OIL CO., INC.

Attn:  Jeru Morgan, Pres.

8306 Wilshire Blvd. #566

Beverly Hills, Ca. 90211

FAX #:  (310) 861-0228

 

EXECUTED this ____ day of May 2011, effective MAY 10, 2011.

 

	
SUCCESS OIL CO., INC.

	  
	
By

	
/s/Jeru Morgan

	  
	
JERU MORGAN

	
President of  SUCCESS OIL CO.

	  
	
ENERGY PRODUCERS, Inc.,

	
a wholly owned subsidiary of

	
EGPI FIRECREEK, Inc.

	  
	
By

	
/s/Dennis Alexander

	
Dennis R. Alexander

	
C.E.O., on behalf of EGPI FIRECREEK, Inc.,

	
sole shareholder of ENERGY PRODUCERS, Inc.ESCROW AGREEMENT

 

May 4, 2011

This Escrow Agreement is reached between the following parties:

 

SUCCESS OIL CO., INC. of 8306 Wilshire Blvd. #566, Beverly Hills, California 90211 hereinafter called ("SUCCESS”),

 

EGPI FIRECREEK, INC./DENNIS ALEXANDER/CEO, AND FURTHER THROUGH ITS WHOLLY OWNED SUBSIDIARY, ENERGY PRODUCERS Inc., of 6564 SMOKE TREE LANE, TOWN OF PARADISE VALLEY, AZ. 85253 hereinafter called (collectively, "FIRECREEK"), and

 

TWL INVESTMENTS A L.L.C. of 3415 W. Pershing Ave., Phoenix, AZ 85029, hereinafter called (“TWL”)

 

CHARLES C. WRIGHT, Attorney at Law, of 201, S. LAUREL AVE., Luling, Texas 78648, hereinafter called ("WRIGHT"),

 

WHEREAS, SUCCESS and  FIRECREEK, and TWL wishes to re-complete/re-work 2 Oil & Gas Wells listed below the location on the J.B. TUBB NORTH 40 ACRES, WARD COUNTY TEXAS (RRC #08-33611), whose legal description is attached hereto on Exhibit "A", hereinafter called ”PROPERTY," said two wells being the Crawar #1 & J.B. Tubb #18-1 wells.

 

WHEREAS, SUCCESS and FIRECREEK have entered into a “Turnkey Rework Agreement (for Turnkey Drilling, Multiple Wells)” attached hereto on Exhibit “B” (the “Participation-Turnkey Program Agreement”) which defines and sets forth the matters therein including Commencement of the development program for the prospect wells located on the Property.

 

WHEREAS, SUCCESS, FIRECREEK, and TWL INVESTMENTS, L.L.C. have agreed to deposit funds with WRIGHT to be disbursed in accordance with this Agreement upon WRIGHT receiving the “Escrow Notification Letter” attached hereto as Exhibit “C”.

 

WHEREAS, pursuant to the Turnkey Rework Agreement FIRECREEK is to pay SUCCESS One Hundred Sixty Five Thousand One Hundred Sixty Two and 36/100 Dollars ($165,162.36) in accordance with the terms of this Escrow Agreement and further, the final confirmation and acceptance of all items therein listed in the Escrow Notification Letter attached on Exhibit “C” hereto. hereto.

  

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For consideration of Ten Dollars ($10.00) and the mutual provisions contained herein, the parties hereto agree as follows:

 

1. WRIGHT is to hold in escrow, Escrow Funds of $200,000.00 provided to him by TWL until the following events:

 

(a) WRIGHT is informed in writing signed by SUCCESS, FIRE CREEK and TWL that  WRIGHT is to pay to SUCCESS $165,162.36

(b)  WRIGHT is to hold the balance of the Escrow Funds until instructed in writing by, FIRECREEK, and TWL to disburse the balance

(c)  If WRIGHT receives conflicting instructions he may place the funds in the registry of a court.

 

2. WRIGHT shall not be responsible for his actions unless such actions are in violation of this Escrow Agreement or WRIGHT acts with willful misconduct or gross negligence.

 

3. This agreement supersedes any and all other agreements, either oral or in writing, between the parties hereto with respect to the subject matter hereof, and no other agreement, statement, or promise relating to the subject matter of this agreement that is not contained herein shall be valid or binding unless in writing signed by all parties.

 

4. If any action at law or in equity is brought to enforce or interpret the provisions of this agreement, the prevailing party shall be entitled to reasonable attorney's fees in addition to any other relief to which he may be entitled.

 

5. The validity of this agreement and of any of its terms or provisions, as well as the rights and duties of the parties hereunder, shall be governed by the laws of the State of Texas.

 

6. This agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.

 

7. All notices, requests, demands and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if sent by hand-delivery, by facsimile (followed by first-class mail), by nationally recognized overnight courier service or by prepaid registered or certified mail, return receipt requested, to the addresses set forth below:

 

  

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If to the Firecreek:

 

EGPI Firecreek, Inc.

6564 Smoke Tree Lane

Scottsdale, AZ 85253

Attention:  Chairman of the Board and Chief Financial Officer

Facsimile No.: (480) 443-1403 480-948-6581 (Voice) 602-326-7371

(Cell)

 

If to SUCCESS:

 

SUCCESS OIL CO., INC.

Attn:  Jeru Morgan, Pres.

8306 Wilshire Blvd. #566

Beverly Hills, Ca. 90211

FAX #:  (310) 861-0228

 

If to TWL INVESTMENTS, L.L.C.:

TWL INVESTMENTS, L.L.C.

3415 W. Pershing Ave.

Phoenix, AZ 85029

Phone 480-461-3592

 

If to Wright:

Charles C. Wright

Attorney at Law

P.O. Box 1331

Luling, Texas 78648

Fax # (830) 875-9266

 

EXECUTED this 9th day of May 2011, effective May 4th, 2011.

 

	  	  
	
Charles C. Wright

 

SUCCESS OIL CO., INC.

 

	
By 

	  	   
	  
	
JERU MORGAN

	
President of  SUCCESS OIL CO.

  

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Energy Producers, Inc.,

a wholly owned subsidiary of

EGPI Firecreek, Inc.

 

	
By

	  	  
	
Dennis R. Alexander

	
President, on behalf of EGPI Firecreek, Inc.,

	
sole shareholder of Energy Producers, Inc.

 

TWL INVESTMENTS L.L.C.

 

	
By

	  	  
	  	  
	
3415 W. PERSHING AVE.

	  
	
PHOENIX, AZ. 85029

	  
	
480-461-3592 Cell 480-369-3392

	  

 

FUNDS WIRED TO:   Citizens State Bank

200 S. Magnolia P.O. Box 350

Luling, Texas 78648  PH. #830-875-2472

Routing Number: 114916488  Credit funds to:

Charles C. Wright Esq. (IOLTA Trust Account No. 09680950)

 

Charles C. Wright Esq.

201 S. Laurel Ave.

Luling, Texas 78648

830-875-3492   FAX:830-875-9266

  

  

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EXHIBIT “A”

 

TO AN ESCROW AGREEMENT

 

EFFECTIVE May 4, 2011

 

Legal Description

 

Description of Lands and Leases:

 

J.B. TUBB NORTH 40 ACRES:

 

J.B. TUBB "18-1", being the Wl/2 of the NW1/4 of Section 18, Block B-20, Public School Lands, Ward County, Texas, containing Eighty (40) acres more or less.      (Area of contract highlighted in yellow)

 

  

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EXHIBIT “B”

 

TO AN ESCROW AGREEMENT

 

EFFECTIVE MAY 4, 2011

 

Turnkey Rework Agreement

 

[TO BE ATTACHED ON FOLLOWING PAGE]

 

  

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EXHIBIT “C”

[Escrow Notification Letter]

 

TO AN ESCROW AGREEMENT

 

EFFECTIVE May 4, 2011

 

[TO BE ATTACHED ON FOLLOWING PAGE OR PAGES AS REQUIRED]

 

  

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EXHIBIT “C”

 

Dated the _____ day of _________, 2011

 

Mr. Charles C. Wright

Attorney at Law

P.O. Box 1331

Luling, Texas 78648

  

Re: Escrow Agreement with effective date of May 4, 2011

 

Dear Mr. Wright:

 

You are hereby instructed to immediately distribute from the escrow funds you are holding, $165,162.36 to Success Oil., Inc.

 

Sincerely,

 

SUCCESS OIL CO., INC.

 

	
By

	  
	  	
Jeru Morgan, President

 

ENERGY PRODUCERS Inc.

 

	
By

	  
	  	
Dennis R. Alexander, Chief Executive Officer

	  	
of EGPI Firecreek, Inc., sole shareholder

	  	
of Energy Producers, Inc.

 

TWL INVESTMENTS, L.L.C.

 

	
By

	  	  

 

  

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