Document:

EX-10.1

Exhibit 10.1

EXECUTION COPY

$200,000,000

DELUXE CORPORATION

7.00% Senior Notes due 2019

PURCHASE AGREEMENT

March 9, 2011

J.P. MORGAN SECURITIES LLC

As Representative of the

several Initial Purchasers listed

in Schedule I hereto

c/o J.P. Morgan Securities LLC

383 Madison Avenue

New York, New York 10179

Ladies and Gentlemen:

Deluxe Corporation, a Minnesota corporation (the “Company”), proposes to issue and
sell to the several initial purchasers listed in Schedule I hereto (the “Initial
Purchasers”), for whom you are acting as representative (the “Representative”),
$200,000,000 principal amount of its 7.00% Senior Notes due 2019 (the “Securities”). The
Securities will be issued pursuant to an Indenture to be dated as of March 15, 2011 (the
“Indenture”), among the Company, the guarantors listed Schedule II hereto (the
“Guarantors”) and U.S. Bank, National Association, as trustee (the “Trustee”), and will be
guaranteed on an unsecured senior basis by each of the Guarantors (the “Guarantees”).

The Securities will be sold to the Initial Purchasers without being registered under the
Securities Act of 1933, as amended (the “Securities Act”), in reliance upon an exemption
therefrom. The Company and the Guarantors have prepared a preliminary offering memorandum dated
March 8, 2011 (the “Preliminary Offering Memorandum”) and will prepare an offering
memorandum dated the date hereof (the “Offering Memorandum”) setting forth information
concerning the Company and the Securities. Copies of the Preliminary Offering Memorandum have
been, and copies of the Offering Memorandum will be, delivered by the Company to the Initial
Purchasers pursuant to the terms of this Agreement. The Company hereby confirms that it has
authorized the use of the Preliminary Offering Memorandum, the other Time of Sale Information (as
defined below) and the Offering Memorandum in connection with the offering and resale of the
Securities by the Initial Purchasers in the manner contemplated by this Agreement. Capitalized
terms used but not defined herein shall have the meanings given to such terms in the Preliminary
Offering Memorandum. References herein to the Preliminary Offering Memorandum, the Time of Sale
Information and the Offering Memorandum shall be deemed to refer to and include any document
incorporated by reference therein.

At or prior to the time when sales of the Securities were first made (the “Time of
Sale”), the following information shall have been prepared (collectively, the “Time of Sale
Information”): the Preliminary Offering Memorandum, as supplemented and amended by the written
communications listed on Annex A hereto.

Holders of the Securities (including the Initial Purchasers and their direct and indirect
transferees) will be entitled to the benefits of a Registration Rights Agreement, to be dated the
Closing Date (as defined below) (the “Registration Rights Agreement”), pursuant to which
the Company and the Guarantors will agree to file one or more registration statements with the
Securities and Exchange Commission (the “Commission”) providing for the registration under
the Securities Act of the Securities or the Exchange Securities referred to (and as defined) in the
Registration Rights Agreement.

The Company and the Guarantors hereby confirm their agreement with the several Initial
Purchasers concerning the purchase and resale of the Securities, as follows:

1. Purchase and Resale of the Securities. (a) The Company agrees to issue and sell
the Securities to the several Initial Purchasers as provided in this Agreement, and each Initial
Purchaser, on the basis of the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the
Company the respective principal amount of Securities set forth opposite such Initial Purchaser’s
name in Schedule I hereto at a price equal to 98.50% of the principal amount thereof plus accrued
interest, if any, from March 15, 2011 to the Closing Date. The Company will not be obligated to
deliver any of the Securities except upon payment for all the Securities to be purchased as
provided herein.

(b) The Company understands that the Initial Purchasers intend to offer the Securities for
resale on the terms set forth in the Time of Sale Information. Each Initial Purchaser, severally
and not jointly, represents, warrants and agrees that:

(i) it is a qualified institutional buyer within the meaning of Rule 144A under the
Securities Act (a “QIB”) and an accredited investor within the meaning of Rule
501(a) of Regulation D under the Securities Act (“Regulation D”);

(ii) it has not solicited offers for, or offered or sold, and will not solicit offers
for, or offer or sell, the Securities by means of any form of general solicitation or
general advertising within the meaning of Rule 502(c) of Regulation D or in any manner
involving a public offering within the meaning of Section 4(2) of the Securities Act; and

(iii) it has not solicited offers for, or offered or sold, and will not solicit offers
for, or offer or sell, the Securities as part of the resale offering of the Securities as
contemplated by the Offering Memorandum (the “Resale Offering”) except:

(A) within the United States to persons whom it reasonably believes to be QIBs
in transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”)
and in connection with each such sale, it has taken or will take reasonable steps to
ensure that the purchaser of the Securities is aware that such sale is being made in
reliance on Rule 144A; or

(B) in accordance with the restrictions set forth in Annex C hereto.

(c) Each Initial Purchaser acknowledges and agrees that the Company and, for purposes of the
“no registration” opinions to be delivered to the Initial Purchasers pursuant to Sections 6(f) and
6(h), counsel for the Company and counsel for the Initial Purchasers, respectively, may rely upon
the accuracy of the representations and warranties of the Initial Purchasers, and compliance by the
Initial Purchasers with their agreements, contained in paragraph (b) above (including Annex C
hereto), and each Initial Purchaser hereby consents to such reliance.

(d) The Company acknowledges and agrees that the Initial Purchasers may offer and sell
Securities to or through any affiliate of an Initial Purchaser and that any such affiliate may
offer and sell Securities purchased by it to or through any Initial Purchaser.

(e) The Company and the Guarantors acknowledge and agree that the Initial Purchasers are
acting solely in the capacity of an arm’s length contractual counterparty to the Company and the
Guarantors with respect to the offering of Securities contemplated hereby (including in connection
with determining the terms of the offering) and not as financial advisors or fiduciaries to, or
agents of, the Company, the Guarantors or any other person. Additionally, neither the
Representative nor any other Initial Purchaser is advising the Company, the Guarantors or any other
person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The
Company and the Guarantors shall consult with their own advisors concerning such matters and shall
be responsible for making their own independent investigation and appraisal of the transactions
contemplated hereby, and neither the Representative nor any other Initial Purchaser shall have any
responsibility or liability to the Company or the Guarantors with respect thereto. Any review by
the Representative or any other Initial Purchaser of the Company, the Guarantors and the
transactions contemplated hereby or other matters relating to such transactions will be performed
solely for the benefit of the Representative or such Initial Purchaser, as the case may be, and
shall not be on behalf of the Company, the Guarantors or any other person.

2. Payment and Delivery. (a) Payment for and delivery of the Securities will be made
at the offices of Simpson Thacher & Bartlett LLP at 10:00 A.M., New York City time, on March 15,
2011, or at such other time or place on the same or such other date, not later than the fifth
business day thereafter, as the Representative and the Company may agree upon in writing. The time
and date of such payment and delivery is referred to herein as the “Closing Date.”

(b) Payment for the Securities shall be made by wire transfer in immediately available funds
to the account(s) specified by the Company to the Representative against delivery to the nominee of
The Depository Trust Company (“DTC”), for the account of the Initial Purchasers, of one or
more global notes representing the Securities (collectively, the “Global Note”), with any
transfer taxes payable in connection with the sale of the Securities duly paid by the Company. The
Global Note will be made available for inspection by the Representative not later than 1:00 P.M.,
New York City time, on the business day prior to the Closing Date.

3. Representations and Warranties of the Company and the Guarantors. The Company and
the Guarantors jointly and severally represent and warrant to each Initial Purchaser that:

(a) Preliminary Offering Memorandum, Time of Sale Information and Offering Memorandum. The
Preliminary Offering Memorandum, as of its date, did not, the Time of Sale Information, at the Time
of Sale, did not, and at the Closing Date, will not, and the Offering Memorandum, in the form first
used by the Initial Purchasers to confirm sales of the Securities and as of the Closing Date, will
not, contain any untrue statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under which they were made,
not misleading; provided that the Company and the Guarantors make no representation or
warranty with respect to any statements or omissions made in reliance upon and in conformity with
information relating to any Initial Purchaser furnished to the Company in writing by such Initial
Purchaser expressly for use in the Preliminary Offering Memorandum, the Time of Sale Information or
the Offering Memorandum.

(b) Additional Written Communications. The Company and the Guarantors (including their
agents and representatives, other than the Initial Purchasers in their capacity as such) have not
prepared, made, used, authorized, approved or referred to and will not prepare, make, use,
authorize, approve or refer to any written communication that constitutes an offer to sell or
solicitation of an offer to buy the Securities (each such communication by the Company and the
Guarantors or their agents and representatives (other than a communication referred to in clauses
(i), (ii) and (iii) below) an “Issuer Written Communication”) other than (i) the
Preliminary Offering Memorandum, (ii) the Offering Memorandum, (iii) the documents listed on Annex
A hereto, including a term sheet substantially in the form of Annex B hereto, which constitute part
of the Time of Sale Information, and (iv) any electronic road show or other written communications,
in each case used in accordance with Section 4(c). Each such Issuer Written Communication, when
taken together with the Time of Sale Information, did not, and at the Closing Date will not,
contain any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which they were made, not
misleading; provided that the Company and the Guarantors make no representation and
warranty with respect to any statements or omissions made in each such Issuer Written Communication
in reliance upon and in conformity with information relating to any Initial Purchaser furnished to
the Company in writing by such Initial Purchaser expressly for use in any Issuer Written
Communication.

(c) Incorporated Documents. The documents incorporated by reference in each of the Time of
Sale Information and the Offering Memorandum, when filed with the Commission, conformed or will
conform, as the case may be, in all material respects to the requirements of the Exchange Act and
the rules and regulations of the Commission thereunder, and, at the Time of Sale, did not and, at
the Closing Date, will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading.

(d) Financial Statements. The financial statements and the related notes thereto included or
incorporated by reference in each of the Time of Sale Information and the Offering Memorandum
present fairly, in all material respects, the financial position of the Company and its
consolidated subsidiaries (the “Subsidiaries”) as of the dates indicated and the results of
their operations and the changes in their cash flows for the periods specified; except as described
in each of the Time of Sale Information and the Offering Memorandum, such financial statements have
been prepared in conformity with accounting principles generally accepted in the United States of
America (“GAAP”) applied on a consistent basis throughout the periods covered thereby; the other
financial information included or incorporated by reference in each of the Time of Sale Information
and the Offering Memorandum has been derived from the accounting records of the Company and its
Subsidiaries and presents fairly, in all material respects, the information shown thereby.

(e) No Material Adverse Change. Except as otherwise disclosed in the Time of Sale Information
and the Offering Memorandum, since the date of the latest audited financial statements of the
Company included or incorporated by reference in each of the Time of Sale Information and the
Offering Memorandum there has been no material adverse change, nor any development or event that
could reasonably be expected to result in a material adverse change, in the condition (financial or
other), business, properties or results of operations of the Company and its Subsidiaries taken as
a whole.

(f) Organization and Good Standing. The Company and each of its Subsidiaries have been duly
organized and are validly existing and in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do business and are in good standing in each
jurisdiction in which their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and have all power and authority necessary to
own or hold their respective properties and to conduct the businesses in which they are engaged,
except where the failure to be so qualified, in good standing or have such power or authority would
not, individually or in the aggregate, reasonably be expected to have a material adverse effect on
the condition (financial or other), business, properties or results of operations of the Company
and its Subsidiaries taken as a whole (a “Material Adverse Effect”). The subsidiaries
listed in Schedule III to this Agreement are the only significant subsidiaries of the Company.

(g) Due Authorization. The Company and each of the Guarantors have full right, power and
authority to execute and deliver, in each case, to the extent a party thereto, this Agreement, the
Securities, the Indenture (including each Guarantee set forth therein), the Exchange Securities
(including the related guarantees) and the Registration Rights Agreement (collectively, the
“Transaction Documents”) and to perform their respective obligations hereunder and
thereunder; and all action required to be taken for the due and proper authorization, execution and
delivery of each of the Transaction Documents and the consummation of the transactions contemplated
thereby has been duly and validly taken.

(h) The Indenture. The Indenture has been duly authorized by the Company and each of the
Guarantors and, when duly executed and delivered in accordance with its terms by each of the
parties thereto, will constitute a valid and legally binding agreement of the Company and each of
the Guarantors enforceable against the Company and each of the Guarantors in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws
affecting the enforcement of creditors’ rights generally or by equitable principles relating to
enforceability (collectively, the “Enforceability Exceptions”); and on the Closing Date,
the Indenture will conform in all material respects to the requirements of the Trust Indenture Act
of 1939, as amended (the “Trust Indenture Act”), and the rules and regulations of the
Commission applicable to an indenture that is qualified thereunder.

(i) The Securities and the Guarantees. The Securities have been duly authorized by the
Company and, when duly executed, authenticated, issued and delivered as provided in the Indenture
and paid for as provided herein, will be duly and validly issued and outstanding and will
constitute valid and legally binding obligations of the Company enforceable against the Company in
accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the
benefits of the Indenture; and the Guarantees have been duly authorized by each of the Guarantors
and, when the Securities have been duly executed, authenticated, issued and delivered as provided
in the Indenture and paid for as provided herein, will be valid and legally binding obligations of
each of the Guarantors, enforceable against each of the Guarantors in accordance with their terms,
subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.

(j) The Exchange Securities and the Related Guarantees. On the Closing Date, the Exchange
Securities will have been duly authorized by the Company and, when duly executed, authenticated,
issued and delivered as contemplated by the Registration Rights Agreement and the Indenture, will
be duly and validly issued and outstanding and will constitute valid and legally binding
obligations of the Company, enforceable against the Company in accordance with their terms, subject
to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture. On the
Closing Date, the related guarantees of the Exchange Securities will have been duly authorized by
each of the Guarantors and, when the Exchange Securities have been duly executed, authenticated,
issued and delivered as contemplated by the Registration Rights Agreement and the Indenture, will
be valid and legally binding obligations of each of the Guarantors, enforceable against each of the
Guarantors in accordance with their terms, subject to the Enforceability Exceptions, and will be
entitled to the benefits of the Indenture.

(k) Purchase and Registration Rights Agreements. This Agreement has been duly authorized,
executed and delivered by the Company and each of the Guarantors; and the Registration Rights
Agreement has been duly authorized by the Company and each of the Guarantors and on the Closing
Date will be duly executed and delivered by the Company and each of the Guarantors and, when duly
executed and delivered in accordance with its terms by each of the parties thereto, will constitute
a valid and legally binding agreement of the Company and each of the Guarantors enforceable against
the Company and each of the Guarantors in accordance with its terms, subject to the Enforceability
Exceptions, and except that rights to indemnity and contribution thereunder may be limited by
applicable law and public policy.

(l) Descriptions of the Transaction Documents. Each Transaction Document conforms in all
material respects to the description thereof contained in each of the Time of Sale Information and
the Offering Memorandum.

(m) No Violation or Default. Neither the Company nor any of its Subsidiaries is (i) in
violation of its charter or by-laws or similar organizational documents; (ii) in default, and no
event has occurred that, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or
any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or
to which any of the property or assets of the Company or any of its Subsidiaries is subject; or
(iii) in violation of any law or statute or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except, in the case of clauses (ii) and (iii)
above, for any such default or violation that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

(n) No Conflicts. The execution, delivery and performance by the Company and each of the
Guarantors of each of the Transaction Documents to which each is a party, the issuance and sale of
the Securities (including the Guarantees) and compliance by the Company and each of the Guarantors
with the terms thereof and the consummation of the transactions contemplated by the Transaction
Documents will not (i) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its Subsidiaries
pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its Subsidiaries is a party or by which the Company or
any of its Subsidiaries is bound or to which any of the property or assets of the Company or any of
its Subsidiaries is subject, (ii) result in any violation of the provisions of the charter or
by-laws or similar organizational documents of the Company or any of its Subsidiaries or (iii)
result in the violation of any law or statute or any judgment, order, rule or regulation of any
court or arbitrator or governmental or regulatory authority, except, in the case of clauses (i) and
(iii) above, for any such conflict, breach, violation, default, lien, charge or encumbrance that
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect.

(o) No Consents Required. No consent, approval, authorization, order, registration or
qualification of or with any court or arbitrator or governmental or regulatory authority is
required for the execution, delivery and performance by the Company and each of the Guarantors of
each of the Transaction Documents to which each is a party, the issuance and sale of the Securities
(including the Guarantees) and compliance by the Company and each of the Guarantors with the terms
thereof and the consummation of the transactions contemplated by the Transaction Documents, except
for such consents, approvals, authorizations, orders and registrations or qualifications as may be
required (i) under applicable state securities laws in connection with the purchase and resale of
the Securities by the Initial Purchasers or (ii) with respect to the Exchange Securities (including
the related guarantees) under the Securities Act, the Trust Indenture Act and applicable state
securities laws as contemplated by the Registration Rights Agreement.

(p) Legal Proceedings. Except as described in each of the Time of Sale Information and the
Offering Memorandum, there are no legal, governmental or regulatory investigations, actions, suits
or proceedings pending to which the Company or any of its Subsidiaries is or may be a party or to
which any property of the Company or any of its Subsidiaries is or may be the subject that would,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or
would reasonably be expected to materially and adversely affect the ability of the Company and the
Guarantors to perform their obligations under the Indenture or this Agreement, or which are
otherwise material in the context of the sale of the Securities; and to the Company’s and the
Guarantors’ knowledge, no such investigations, actions, suits or proceedings are threatened.

(q) Independent Registered Public Accounting Firm. PricewaterhouseCoopers LLP, who have
audited the consolidated financial statements of the Company at December 31, 2010 and 2009 and for
each of the three years in the period ended December 31, 2010, are independent registered public
accountants with respect to the Company and its Subsidiaries within the applicable rules and
regulations adopted by the Commission and the Public Company Accounting Oversight Board (United
States) and as required by the Securities Act.

(r) Title to Real and Personal Property. The Company and its Subsidiaries have good and
marketable title in fee simple to, or have valid rights to lease or otherwise use, all items of
real and personal property that are material to the businesses of the Company and its Subsidiaries,
taken as a whole, in each case free and clear of all liens, encumbrances, claims and defects and
imperfections of title except those that (i) do not materially interfere with the use made and
proposed to be made of such property by the Company and its Subsidiaries, taken as a whole, or (ii)
could not reasonably be expected, individually or in the aggregate, to have a Material Adverse
Effect.

(s) Title to Intellectual Property. The Company and its Subsidiaries own or possess adequate
rights to use all material patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service mark registrations, copyrights, licenses and know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) necessary for the conduct of their respective businesses and the conduct of
their respective businesses will not conflict in any material respect with any such rights of
others, except where the failure to own or possess such rights or such conflict would not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and the
Company and its Subsidiaries have not received any notice of any claim of infringement of or
conflict with any such rights of others, except for any notices or conflicts that would not
reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

(t) Investment Company Act. None of the Company or any of the Guarantors is, and after giving
effect to the offering and sale of the Securities and the application of the proceeds thereof as
described in each of the Time of Sale Information and the Offering Memorandum none of them will be,
an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and
the rules and regulations of the Commission thereunder (collectively, the “Investment Company
Act”).

(u) Taxes. (i) The Company and its Subsidiaries have paid all federal, state, local and
foreign taxes and filed all tax returns required to be paid or filed through the date hereof, and
(ii) except as otherwise disclosed in each of the Time of Sale Information and the Offering
Memorandum, there is no tax deficiency that has been, or could reasonably be expected to be,
asserted against the Company or any of its Subsidiaries or any of their respective properties or
assets, except in the case of each of clauses (i) and (ii), (x) for any such taxes or tax
deficiencies that are currently being contested in good faith and for which the Company has
established adequate reserves in accordance with GAAP, or (y) as would not, individually or in the
aggregate, have a Material Adverse Effect.

(v) Licenses and Permits. The Company and its Subsidiaries possess all licenses,
certificates, permits and other authorizations issued by, and have made all declarations and
filings with, the appropriate federal, state, local or foreign governmental or regulatory
authorities that are necessary for the ownership or lease of their respective properties or the
conduct of their respective businesses as described in each of the Time of Sale Information and the
Offering Memorandum, except where the failure to possess or make the same would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect; and except as
described in each of the Time of Sale Information and the Offering Memorandum, neither the Company
nor any of its Subsidiaries has received notice of any revocation or modification of any such
license, certificate, permit or authorization or has any reason to believe that any such license,
certificate, permit or authorization will not be renewed in the ordinary course, except where such
revocation, modification or failure to receive such renewal would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

(w) Compliance with Environmental Laws. Except as described in each of the Time of Sale
Information and the Offering Memorandum, neither the Company nor any of its Subsidiaries is in
violation of any applicable statute, rule, regulation, decision or order of any governmental agency
or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or
toxic substances or relating to the protection or restoration of the environment or human exposure
to hazardous or toxic substances (collectively, “Environmental Laws”), to the knowledge of
the Company and the Guarantors owns or operates any real property contaminated with any substance
that is subject to any Environmental Laws, is liable for any off-site disposal or contamination
pursuant to any Environmental Laws, or is subject to any claim relating to any Environmental Laws,
which violation, contamination, liability or claim would individually or in the aggregate
reasonably be expected to have a Material Adverse Effect; and none of the Company or any of the
Guarantors is aware of any pending investigation which is reasonably expected to lead to any such
claim.

(x) Disclosure Controls. The Company on a consolidated basis, including its Subsidiaries,
maintains an effective system of “disclosure controls and procedures” (as defined in Rule 13a-15(e)
of the Exchange Act) that is designed to ensure that information required to be disclosed by the
Company in reports that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the Commission’s rules and forms,
including controls and procedures designed to ensure that such information is accumulated and
communicated to the Company’s management as appropriate to allow timely decisions regarding
required disclosure. The Company on a consolidated basis, including its Subsidiaries, has carried
out evaluations of the effectiveness of its disclosure controls and procedures as required by Rule
13a-15 of the Exchange Act.

(y) Accounting Controls. The Company on a consolidated basis, including its Subsidiaries,
maintains systems of “internal control over financial reporting” (as defined in Rule 13a-15(f) of
the Exchange Act) that comply with the requirements of the Exchange Act and have been designed by,
or under the supervision of, their respective principal executive and principal financial officers,
or persons performing similar functions, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in
accordance with GAAP. Except as disclosed in each of the Time of Sale Information and the Offering
Memorandum, there are no material weaknesses in the Company’s internal controls.

(z) No Broker’s Fees. Neither the Company nor any of its Subsidiaries is a party to any
contract, agreement or understanding with any person (other than this Agreement) that would give
rise to a valid claim against any of them or any Initial Purchaser for a brokerage commission,
finder’s fee or like payment in connection with the offering and sale of the Securities.

(aa) Rule 144A Eligibility. On the Closing Date, the Securities will not be of the same class
as securities listed on a national securities exchange registered under Section 6 of the Exchange
Act or quoted in an automated inter-dealer quotation system; and each of the Preliminary Offering
Memorandum and the Offering Memorandum, as of its respective date, contains or will contain all the
information that, if requested by a prospective purchaser of the Securities, would be required to
be provided to such prospective purchaser pursuant to Rule 144A(d)(4) under the Securities Act.

(bb) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b)
of Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to
buy or otherwise negotiated in respect of, any security (as defined in the Securities Act), that is
or will be integrated with the sale of the Securities in a manner that would require registration
of the Securities under the Securities Act.

(cc) No General Solicitation or Directed Selling Efforts. None of the Company or any of its
affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as
to which no representation is made) has (i) solicited offers for, or offered or sold, the
Securities by means of any form of general solicitation or general advertising within the meaning
of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act or (ii) engaged in any directed selling efforts within the
meaning of Regulation S under the Securities Act (“Regulation S”), and all such persons
have complied with the offering restrictions requirement of Regulation S.

(dd) Securities Law Exemptions. Assuming the accuracy of the representations and warranties
of the Initial Purchasers contained in Section 1(b) (including Annex C hereto) and their compliance
with their agreements set forth therein, it is not necessary, in connection with the issuance and
sale of the Securities to the Initial Purchasers and the offer, resale and delivery of the
Securities by the Initial Purchasers in the manner contemplated by this Agreement, the Time of Sale
Information and the Offering Memorandum, to register the Securities under the Securities Act or to
qualify the Indenture under the Trust Indenture Act.

(ee) No Stabilization. None of the Company or any of the Guarantors has taken, directly or
indirectly, any action designed to or that could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the Securities.

(ff) Forward-Looking Statements. No forward-looking statement (within the meaning of Section
27A of the Securities Act and Section 21E of the Exchange Act) included or incorporated by
reference in any of the Time of Sale Information or the Offering Memorandum has been made or
reaffirmed without a reasonable basis or has been disclosed other than in good faith.

(gg) Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or any
of the Company’s directors or officers, in their capacities as such, to comply with any provision
of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith
(the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906
related to certifications.

4. Further Agreements of the Company and the Guarantors. The Company and each of the
Guarantors jointly and severally covenant and agree with each Initial Purchaser that:

(a) Delivery of Copies. The Company will deliver, without charge, to the Initial Purchasers
as many copies of the Preliminary Offering Memorandum, any other Time of Sale Information, any
Issuer Written Communication and the Offering Memorandum (including all amendments and supplements
thereto) as the Representative may reasonably request.

(b) Offering Memorandum, Amendments or Supplements. At any time prior to the later of the
Closing Date and the completion of the Resale Offering (the “Covenant Period”), before
finalizing the Offering Memorandum or making or distributing any amendment or supplement to any of
the Time of Sale Information or the Offering Memorandum or filing with the Commission any document
that will be incorporated by reference therein, the Company will furnish to the Representative and
counsel for the Initial Purchasers a copy of the proposed Offering Memorandum or such amendment or
supplement or document to be incorporated by reference therein for review, and will not distribute
any such proposed Offering Memorandum, amendment or supplement or file any such document with the
Commission to which the Representative reasonably objects.

(c) Additional Written Communications. During the Covenant Period, before using, authorizing,
approving or referring to any Issuer Written Communication, the Company and the Guarantors will
furnish to the Representative and counsel for the Initial Purchasers a copy of such written
communication for review and will not use, authorize, approve or refer to any such written
communication to which the Representative reasonably objects.

(d) Notice to the Representative. During the Covenant Period, the Company will advise the
Representative promptly, and confirm such advice in writing, (i) of the issuance by any
governmental or regulatory authority of any order preventing or suspending the use of any of the
Time of Sale Information, any Issuer Written Communication or the Offering Memorandum or the
initiation or threatening of any proceeding for that purpose; (ii) of the occurrence of any event
as a result of which any of the Time of Sale Information, any Issuer Written Communication or the
Offering Memorandum as then amended or supplemented would include any untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances existing when such Time of Sale Information, Issuer Written
Communication or the Offering Memorandum is delivered to a purchaser, not misleading; and (iii) of
the receipt by the Company of any notice with respect to any suspension of the qualification of the
Securities for offer and sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and the Company will use its commercially reasonable efforts to
prevent the issuance of any such order preventing or suspending the use of any of the Time of Sale
Information, any Issuer Written Communication or the Offering Memorandum or suspending any such
qualification of the Securities and, if any such order is issued, will use commercially reasonable
efforts to obtain the withdrawal thereof.

(e) Time of Sale Information. If at any time prior to the Closing Date (i) any event shall
occur or condition shall exist as a result of which any of the Time of Sale Information as then
amended or supplemented would include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading or (ii) it is necessary to amend or supplement any of
the Time of Sale Information to comply with law, the Company will promptly notify the Initial
Purchasers thereof and forthwith prepare and, subject to paragraph (b) above, furnish to the
Initial Purchasers such amendments or supplements to any of the Time of Sale Information (or any
document to be filed with the Commission and incorporated by reference therein) as may be necessary
so that the statements in any of the Time of Sale Information as so amended or supplemented
(including such document to be incorporated by reference) will not, in light of the circumstances
under which they were made, be misleading or so that any of the Time of Sale Information will
comply with law.

(f) Ongoing Compliance of the Offering Memorandum. If during the Covenant Period (i) any
event shall occur or condition shall exist as a result of which the Offering Memorandum as then
amended or supplemented would include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the circumstances
existing when the Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is
necessary to amend or supplement the Offering Memorandum to comply with law, the Company will
promptly notify the Initial Purchasers thereof and forthwith prepare and, subject to paragraph (b)
above, furnish to the Initial Purchasers such amendments or supplements to the Offering Memorandum
(or any document to be filed with the Commission and incorporated by reference therein) as may be
necessary so that the statements in the Offering Memorandum as so amended or supplemented
(including such document to be incorporated by reference therein) will not, in the light of the
circumstances existing when the Offering Memorandum is delivered to a purchaser, be misleading or
so that the Offering Memorandum will comply with law.

(g) Blue Sky Compliance. The Company will cooperate with the Initial Purchasers to qualify
the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as
the Representative shall reasonably request and will continue such qualifications in effect so long
as required for the Resale Offering; provided that neither the Company nor any of the
Guarantors shall be required to (i) qualify as a foreign corporation or other entity or as a dealer
in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii)
file any general consent to service of process in any such jurisdiction or (iii) subject itself to
taxation in any such jurisdiction if it is not otherwise so subject.

(h) Clear Market. During the period from the date hereof through and including the date that
is 90 days after the date hereof, the Company and each of the Guarantors will not, without the
prior written consent of J.P. Morgan Securities LLC, offer, sell, contract to sell or otherwise
dispose of any debt securities issued or guaranteed by the Company or any of the Guarantors and
having a tenor of more than one year.

(i) Use of Proceeds. The Company will apply the net proceeds from the sale of the Securities
as described in each of the Time of Sale Information and the Offering Memorandum under the heading
“Use of proceeds.”

(j) Supplying Information. While the Securities remain outstanding and are “restricted
securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company and each of
the Guarantors will, during any period in which the Company is not subject to and in compliance
with Section 13 or 15(d) of the Exchange Act, furnish to holders of the Securities and prospective
purchasers of the Securities designated by such holders, upon the request of such holders or such
prospective purchasers, the information required to be delivered pursuant to Rule 144A(d)(4) under
the Securities Act.

(k) DTC. The Company will assist the Initial Purchasers in arranging for the Securities to be
eligible for clearance and settlement through DTC.

(l) No Resales by the Company. Until the issuance of the Exchange Securities, the Company
will not, and will not permit any of its affiliates (as defined in Rule 144 under the Securities
Act) to, resell any of the Securities that have been acquired by any of them, except for Securities
purchased by the Company or any of its affiliates and resold in a transaction registered under the
Securities Act.

(m) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b)
of Regulation D) will, directly or through any agent, sell, offer for sale, solicit offers to buy
or otherwise negotiate in respect of, any security (as defined in the Securities Act), that is or
will be integrated with the sale of the Securities in a manner that would require registration of
the Securities under the Securities Act.

(n) No General Solicitation or Directed Selling Efforts. None of the Company or any of its
affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as
to which no covenant is given) will (i) solicit offers for, or offer or sell, the Securities by
means of any form of general solicitation or general advertising within the meaning of Rule 502(c)
of Regulation D or in any manner involving a public offering within the meaning of Section 4(2) of
the Securities Act or (ii) engage in any directed selling efforts within the meaning of Regulation
S, and all such persons will comply with the offering restrictions requirement of Regulation S.

(o) No Stabilization. Neither the Company nor any of the Guarantors will take, directly or
indirectly, any action designed to or that could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the Securities.

5. Certain Agreements of the Initial Purchasers. Each Initial Purchaser hereby
represents and agrees that it has not and will not use, authorize use of, refer to, or participate
in the planning for use of, any written communication that constitutes an offer to sell or the
solicitation of an offer to buy the Securities other than (i) the Preliminary Offering Memorandum
and the Offering Memorandum, (ii) a written communication that contains no “issuer information” (as
defined in Rule 433(h)(2) under the Securities Act) that was not included (including through
incorporation by reference) in the Preliminary Offering Memorandum or the Offering Memorandum,
(iii) any written communication listed on Annex A or prepared pursuant to Section 4(c) above
(including any electronic road show), (iv) any written communication prepared by such Initial
Purchaser and approved by the Company in advance in writing or (v) any written communication
relating to or that contains the terms of the Securities and/or other information that was included
(including through incorporation by reference) in the Preliminary Offering Memorandum or the
Offering Memorandum.

6. Conditions of Initial Purchasers’ Obligations. The obligation of each Initial
Purchaser to purchase Securities on the Closing Date as provided herein is subject to the
performance by the Company and each of the Guarantors of their respective covenants and other
obligations hereunder and to the following additional conditions:

(a) Representations and Warranties. The representations and warranties of the Company and the
Guarantors contained herein shall be true and correct on the date hereof and on and as of the
Closing Date; and the statements of the Company, the Guarantors and their respective officers made
in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the
Closing Date.

(b) No Downgrade. Subsequent to the earlier of (A) the Time of Sale and (B) the execution and
delivery of this Agreement, (i) no downgrading shall have occurred in the rating accorded the
Securities or any other debt securities issued or guaranteed by the Company or any of the
Guarantors by any “nationally recognized statistical rating organization,” as such term is defined
in Section 3(a)(62) of the Exchange Act; and (ii) no such organization shall have publicly
announced that it has under surveillance or review, or has changed its outlook with respect to, its
rating of the Securities or of any other debt securities issued or guaranteed by the Company or any
of the Guarantors (other than an announcement with positive implications of a possible upgrading).

(c) No Material Adverse Change. No event or condition of a type described in Section 3(e)
hereof shall have occurred or shall exist, which event or condition is not described in each of the
Time of Sale Information (excluding any amendment or supplement thereto) and the Offering
Memorandum (excluding any amendment or supplement thereto) the effect of which in the judgment of
the Representative makes it impracticable or inadvisable to proceed with the offering, sale or
delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time
of Sale Information and the Offering Memorandum.

(d) Officer’s Certificate. The Representative shall have received on and as of the Closing
Date a certificate of an executive officer of the Company and of each Guarantor who has specific
knowledge of the Company’s or such Guarantor’s financial matters and is satisfactory to the
Representative (i) confirming that such officer has carefully reviewed the Time of Sale Information
and the Offering Memorandum and, to the best knowledge of such officer, the representations set
forth in Sections 3(a) and 3(b) hereof are true and correct, (ii) confirming that the other
representations and warranties of the Company and the Guarantors in this Agreement are true and
correct and that the Company and the Guarantors have complied with all agreements and satisfied all
conditions on their part to be performed or satisfied hereunder at or prior to the Closing Date and
(iii) to the effect set forth in paragraphs (b) and (c) above.

(e) Comfort Letters. On the date of this Agreement and on the Closing Date,
PricewaterhouseCoopers LLP shall have furnished to the Representative, at the request of the
Company, letters, dated the respective dates of delivery thereof and addressed to the Initial
Purchasers, in form and substance reasonably satisfactory to the Representative, containing
statements and information of the type customarily included in accountants’ “comfort letters” to
underwriters with respect to the financial statements and certain financial information contained
or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum;
provided that the letter delivered on the Closing Date shall use a “cut-off” date no more
than three business days prior to the Closing Date.

(f) Opinion and 10b-5 Statement of Counsel for the Company. Dorsey & Whitney LLP, counsel for
the Company, shall have furnished to the Representative, at the request of the Company, their
written opinion and 10b-5 statement, dated the Closing Date and addressed to the Initial
Purchasers, in form and substance reasonably satisfactory to the Representative, to the effect set
forth in Annex D hereto

(g) Opinion of General Counsel of the Company. Anthony Scarfone, as General Counsel of the
Company, shall have furnished to the Representative his written opinion, dated the Closing Date and
addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the
Representative, to the effect set forth in Annex E hereto.

(h) Opinion and 10b-5 Statement of Counsel for the Initial Purchasers. The Representative
shall have received on and as of the Closing Date an opinion and 10b-5 statement of Simpson Thacher
& Bartlett LLP, counsel for the Initial Purchasers, with respect to such matters as the
Representative may reasonably request, and such counsel shall have received such documents and
information as they may reasonably request to enable them to pass upon such matters.

(i) Chief Financial Officer’s Certificate. The Representative shall have received on and as of
the Closing Date a certificate of the chief financial officer of the Company confirming that the
chief financial officer is familiar with the accounting records and internal accounting practices,
policies, procedures and controls of the Company and has had responsibility for accounting matters
with respect to the Company, and attesting certain financial information contained in the Time of
Sale Information and Offering Memorandum.

(j) No Legal Impediment to Issuance. No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any federal, state or foreign
governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or
sale of the Securities or the issuance of the Guarantees; and no injunction or order of any
federal, state or foreign court shall have been issued that would, as of the Closing Date, prevent
the issuance or sale of the Securities or the issuance of the Guarantees.

(k) Good Standing. The Representative shall have received on and as of the Closing Date
satisfactory evidence of the good standing of the Company and the Guarantors in their respective
jurisdictions of organization and their good standing in such other jurisdictions as the
Representative may reasonably request, in each case in writing or any standard form of
telecommunication, from the appropriate governmental authorities of such jurisdictions.

(l) Registration Rights Agreement. The Initial Purchasers shall have received a counterpart
of the Registration Rights Agreement that shall have been executed and delivered by a duly
authorized officer of the Company and each of the Guarantors.

(m) DTC. The Securities shall be eligible for clearance and settlement through DTC.

(n) Additional Documents. On or prior to the Closing Date, the Company and the Guarantors
shall have furnished to the Representative such further certificates and documents as the
Representative may reasonably request.

All opinions, letters, certificates and evidence mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to counsel for the Initial Purchasers.

7. Indemnification and Contribution.

(a) Indemnification of the Initial Purchasers. The Company and each of the Guarantors jointly
and severally agree to indemnify and hold harmless each Initial Purchaser, its affiliates and their
respective directors, officers and employees and each person, if any, who controls such Initial
Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages and liabilities (including, without
limitation, legal fees and other expenses reasonably incurred in connection with any suit, action
or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several,
that arise out of, or are based upon, any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Offering Memorandum, any of the other Time of Sale
Information, any Issuer Written Communication or the Offering Memorandum (or any amendment or
supplement thereto) or any omission or alleged omission to state therein a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading, in each case except insofar as such losses, claims, damages or liabilities
arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or
omission made in any such documents in reliance upon and in conformity with any information
relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through the Representative expressly for use therein.

(b) Indemnification of the Company and the Guarantors. Each Initial Purchaser agrees,
severally and not jointly, to indemnify and hold harmless the Company, each of the Guarantors, each
of their respective directors, officers and employees and each person, if any, who controls the
Company or any of the Guarantors within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but
only with respect to any losses, claims, damages or liabilities that arise out of, or are based
upon, any untrue statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with any information relating to such Initial Purchaser furnished to the
Company in writing by such Initial Purchaser through the Representative expressly for use in the
Preliminary Offering Memorandum, any of the other Time of Sale Information, any Issuer Written
Communication or the Offering Memorandum (or any amendment or supplement thereto), it being
understood and agreed that the only such information consists of the information appearing in (i)
the fourth and fifth sentences of the tenth paragraph concerning market making activities of the
Initial Purchasers under the caption “Plan of distribution” in the Offering Memorandum and (ii) the
twelfth paragraph concerning stabilizing transactions under the caption “Plan of distribution” in
the Offering Memorandum.

(c) Notice and Procedures. If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against any person in
respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such
person (the “Indemnified Person”) shall promptly notify the person against whom such
indemnification may be sought (the “Indemnifying Person”) in writing; provided that
the failure to notify the Indemnifying Person shall not relieve it from any liability that it may
have under paragraphs (a) or (b) above except to the extent that it has been materially prejudiced
(through the forfeiture of substantive rights or defenses) by such failure; and provided,
further, that the failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have to an Indemnified Person otherwise than under paragraphs (a) or (b)
above. If any such proceeding shall be brought or asserted against an Indemnified Person and it
shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel
reasonably satisfactory to the Indemnified Person (who shall not, without the consent of the
Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person and
any others entitled to indemnification pursuant to this Section 7 that the Indemnifying Person may
designate in such proceeding and shall pay the fees and expenses of such proceeding and shall pay
the fees and expenses of such counsel related to such proceeding, as incurred. In any such
proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory
to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there
may be legal defenses available to it that are different from or in addition to those available to
the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded
parties) include both the Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential differing interests
between them. It is understood and agreed that the Indemnifying Person shall not, in connection
with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for all Indemnified
Persons, and that all such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for any Initial Purchaser, its affiliates, directors and officers and any control
persons of such Initial Purchaser shall be designated in writing by J.P. Morgan Securities LLC and
any such separate firm for the Company, the Guarantors, their respective directors and officers and
any control persons of the Company and the Guarantors shall be designated in writing by the
Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing
sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person
reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this
paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30 days after receipt
by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have
reimbursed the Indemnified Person in accordance with such request prior to the date of such
settlement. No Indemnifying Person shall, without the written consent of the Indemnified Person,
effect any settlement of any pending or threatened proceeding in respect of which any Indemnified
Person is or could have been a party and indemnification could have been sought hereunder by such
Indemnified Person, unless such settlement (x) includes an unconditional release of such
Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from
all liability on claims that are the subject matter of such proceeding and (y) does not include any
statement as to or any admission of fault, culpability or a failure to act by or on behalf of any
Indemnified Person.

(d) Contribution. If the indemnification provided for in paragraphs (a) and (b) above is
unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the Company and the
Guarantors on the one hand and the Initial Purchasers on the other from the offering of the
Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits referred to in clause
(i) but also the relative fault of the Company and the Guarantors on the one hand and the Initial
Purchasers on the other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Guarantors on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same respective proportions as the net
proceeds (before deducting expenses) received by the Company from the sale of the Securities and
the total discounts and commissions received by the Initial Purchasers in connection therewith, as
provided in this Agreement, bear to the aggregate offering price of the Securities. The relative
fault of the Company and the Guarantors on the one hand and the Initial Purchasers on the other
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company or any Guarantor or by the Initial Purchasers and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.

(e) Limitation on Liability. The Company, the Guarantors and the Initial Purchasers agree
that it would not be just and equitable if contribution pursuant to this Section 7 were determined
by pro rata allocation (even if the Initial Purchasers were treated as one entity
for such purpose) or by any other method of allocation that does not take account of the equitable
considerations referred to in paragraph (d) above. The amount paid or payable by an Indemnified
Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d)
above shall be deemed to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such Indemnified Person in connection with any such action or
claim. Notwithstanding the provisions of this Section 7, in no event shall an Initial Purchaser be
required to contribute any amount in excess of the amount by which the total discounts and
commissions received by such Initial Purchaser with respect to the offering of the Securities
exceeds the amount of any damages that such Initial Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers’ obligations to contribute pursuant to this Section 7
are several in proportion to their respective purchase obligations hereunder and not joint.

(f) Non-Exclusive Remedies. The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies that may otherwise be available to any Indemnified Person at
law or in equity.

8. Termination. This Agreement may be terminated in the absolute discretion of the
Representative, by notice to the Company, if after the execution and delivery of this Agreement and
on or prior to the Closing Date (i) trading generally shall have been suspended or materially
limited on the New York Stock Exchange or the over-the-counter market; (ii) trading of any
securities issued or guaranteed by the Company or any of the Guarantors shall have been suspended
on any exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking
activities shall have been declared by federal or New York State authorities; or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis, either within or outside the United States, that, in the judgment of the
Representative, is material and adverse and makes it impracticable or inadvisable to proceed with
the offering, sale or delivery, of the Securities on the terms and in the manner contemplated by
this Agreement, the Time of Sale Information and the Offering Memorandum.

If the sale to the Initial Purchasers of the Securities, as contemplated by this Agreement, is
not consummated by the Initial Purchasers for any reason permitted under this Agreement or if such
sale is not carried out because the Company or any of the Guarantors shall be unable to comply with
any of the terms of this Agreement, the Company and the Guarantors shall not be under any
obligation or liability under this Agreement (except to the extent provided by Sections 7 and 10
hereof), and the Initial Purchasers shall be under no obligation or liability to the Company or any
of the Guarantors under this Agreement (except to the extent provided in Section 7 hereof).

9. Defaulting Initial Purchaser. (a) If, on the Closing Date, any Initial Purchaser
defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder, the
non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such
Securities by other persons satisfactory to the Company on the terms contained in this Agreement.
If, within 36 hours after any such default by any Initial Purchaser, the non-defaulting Initial
Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled
to a further period of 36 hours within which to procure other persons satisfactory to the
non-defaulting Initial Purchasers to purchase such Securities on such terms. If other persons
become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the
non-defaulting Initial Purchasers or the Company may postpone the Closing Date for up to five full
business days in order to effect any changes that in the opinion of counsel for the Company or
counsel for the Initial Purchasers may be necessary in the Time of Sale Information, the Offering
Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any
amendment or supplement to the Time of Sale Information or the Offering Memorandum that effects any
such changes. As used in this Agreement, the term “Initial Purchaser” includes, for all purposes
of this Agreement unless the context otherwise requires, any person not listed in Schedule I hereto
that, pursuant to this Section 9, purchases Securities that a defaulting Initial Purchaser agreed
but failed to purchase.

(b) If, after giving effect to any arrangements for the purchase of the Securities of a
defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the
Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that
remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the
Securities, then the Company shall have the right to require each non-defaulting Initial Purchaser
to purchase the principal amount of Securities that such Initial Purchaser agreed to purchase
hereunder plus such Initial Purchaser’s pro rata share (based on the principal
amount of Securities that such Initial Purchaser agreed to purchase hereunder) of the Securities of
such defaulting Initial Purchaser or Initial Purchasers for which such arrangements have not been
made.

(c) If, after giving effect to any arrangements for the purchase of the Securities of a
defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the
Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that
remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Securities,
or if the Company shall not exercise the right described in paragraph (b) above, then this
Agreement shall terminate without liability on the part of the non-defaulting Initial Purchasers.
Any termination of this Agreement pursuant to this Section 9 shall be without liability on the part
of the Company or the Guarantors, except that the Company and each of the Guarantors will continue
to be liable for the payment of expenses as set forth in Section 10 hereof and except that the
provisions of Section 7 hereof shall not terminate and shall remain in effect.

(d) Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it
may have to the Company, the Guarantors or any non-defaulting Initial Purchaser for damages caused
by its default.

10. Payment of Expenses. (a) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Company and each of the Guarantors
jointly and severally agree to pay or cause to be paid all costs and expenses incident to the
performance of their respective obligations hereunder, including without limitation, (i) the costs
incident to the authorization, issuance, sale, preparation and delivery of the Securities and any
taxes payable in that connection; (ii) the costs incident to the preparation and printing of the
Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written
Communication and the Offering Memorandum (including any amendment or supplement thereto) and the
distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction
Documents; (iv) the fees and expenses of the Company’s and the Guarantors’ counsel and independent
accountants; (v) the reasonable fees and expenses incurred in connection with the registration or
qualification and determination of eligibility for investment of the Securities under the laws of
such jurisdictions as the Representative may designate and the preparation, printing and
distribution of a Blue Sky Memorandum (including the related fees and expenses of counsel for the
Initial Purchasers); (vi) any fees charged by rating agencies for rating the Securities; (vii) the
fees and expenses of the Trustee and any paying agent (including related fees and expenses of any
counsel to such parties); (viii) all expenses and application fees incurred in connection with the
application for the approval of the Securities for book-entry transfer by DTC; and (ix) all
expenses incurred by the Company in connection with any “road show” presentation to potential
investors, provided that the cost of any chartered plane used in connection with any such
“road show” presentation to investors shall be paid as follows: 50.0% by the Company and the
Guarantors and 50.0% by the Initial Purchasers. Except as provided in Section 10(b), the
Initial Purchasers will pay all of their own costs and expenses in connection with the transactions
contemplated hereby, including, without limitation, the fees and expenses of their counsel.

(b) If (i) this Agreement is terminated pursuant to Section 8, (ii) the Company for any reason
fails to tender the Securities for delivery to the Initial Purchasers or (iii) the Initial
Purchasers decline to purchase the Securities for any reason permitted under this Agreement, the
Company and each of the Guarantors jointly and severally agrees to reimburse the Initial Purchasers
for all out-of-pocket costs and expenses (including the fees and expenses of their counsel)
reasonably incurred by the Initial Purchasers in connection with this Agreement and the offering
contemplated hereby.

11. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective successors and any
controlling persons referred to herein, and the affiliates, officers and directors of each Initial
Purchaser referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein. No purchaser of Securities from any
Initial Purchaser shall be deemed to be a successor merely by reason of such purchase.

12. Survival. The respective indemnities, rights of contribution, representations,
warranties and agreements of the Company, the Guarantors and the Initial Purchasers contained in
this Agreement or made by or on behalf of the Company, the Guarantors or the Initial Purchasers
pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery
of and payment for the Securities and shall remain in full force and effect, regardless of any
termination of this Agreement or any investigation made by or on behalf of the Company, the
Guarantors or the Initial Purchasers.

13. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise
expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities
Act; (b) the term “business day” means any day other than a day on which banks are permitted or
required to be closed in New York City; (c) the term “Exchange Act” means the Securities Exchange
Act of 1934, as amended; (d) the term “subsidiary” has the meaning set forth in Rule 405 under the
Securities Act; (e) the term “written communication” has the meaning set forth in Rule 405 under
the Securities Act; and (f) the term “significant subsidiary” has the meaning set forth in Rule
1-02 of Regulation S-X under the Exchange Act.

14. Miscellaneous. (a) Authority of the Representative. Any action by the Initial
Purchasers hereunder may be taken by J.P. Morgan Securities LLC on behalf of the Initial
Purchasers, and any such action taken by J.P. Morgan Securities LLC shall be binding upon the
Initial Purchasers.

(b) Notices. All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted and confirmed by any standard form of
telecommunication. Notices to the Initial Purchasers shall be given to the Representative c/o J.P.
Morgan Securities LLC, 383 Madison Avenue, New York, New York 10179 (fax: (212)- 270-1063);
Attention: Syndicated & Leveraged Finance. Notices to the Company and the Guarantors shall be
given to it at Deluxe Corporation, 3680 Victoria St. North, Shoreview, Minnesota 55126 (fax: (651)
787-2749); Attention: General Counsel, with a copy to Dorsey & Whitney LLP, 250 Park Avenue, New
York, New York (fax: (646) 390-6549); Attention: Steven Khadavi.

(c) Governing Law. This Agreement and any claim, controversy or dispute arising under or
related to this Agreement shall be governed by and construed in accordance with the laws of the
State of New York.

(d) Counterparts. This Agreement may be signed in counterparts (which may include
counterparts delivered by any standard form of telecommunication), each of which shall be an
original and all of which together shall constitute one and the same instrument.

(e) Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any
consent or approval to any departure therefrom, shall in any event be effective unless the same
shall be in writing and signed by the parties hereto.

(f) Headings. The headings herein are included for convenience of reference only and are not
intended to be part of, or to affect the meaning or interpretation of, this Agreement.

[Remainder of page left intentionally blank.]

If the foregoing is in accordance with your understanding, please indicate your
acceptance of this Agreement by signing in the space provided below.

Very truly yours,

DELUXE CORPORATION

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	ABACUS AMERICA, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	CUSTOM DIRECT, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	CUSTOM DIRECT LLC

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	DELUXE BUSINESS OPERATIONS, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	DELUXE ENTERPRISE OPERATIONS, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	DELUXE FINANCIAL SERVICES, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	DELUXE MANUFACTURING OPERATIONS, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	DELUXE SMALL BUSINESS SALES, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	HOSPTOPIA.COM INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	SAFEGUARD BUSINESS SYSTEMS, INC.

	 	 	 
	By: /s/ Terry D. Peterson

	 

	Name:

Title:

	 	Terry D. Peterson

Vice President and Treasurer

	 	 	SAFEGUARD HOLDINGS, INC.

	 	 	 
	
 
	 	By: /s/ Terry D. Peterson
	
 
	 	 
	
 
	 	Name:Terry D. Peterson

Title:Vice President and Treasurer

1

	 	 	 
	Confirmed and accepted as of the

	 	date first above written:
	J.P. MORGAN SECURITIES LLC

For itself and on behalf of the

several Initial Purchasers

	 	

	By:      /s/       Meredith Hopson—

	 	

	 

	 	 
	Name: Meredith Hopson

Title:

	 	Authorized Signatory

Vice President

2

SCHEDULE I

	 	 	 	 	 
	 	 	Principal Amount of
	Purchasers	 	Securities to be Purchased
	J.P. Morgan Securities LLC
	 	$	90,000,000	 
	Credit Suisse Securities (USA) LLC
	 	$	70,000,000	 
	Mitsubishi UFJ Securities (USA), Inc.
	 	$	16,000,000	 
	Fifth Third Securities, Inc.
	 	$	12,000,000	 
	U.S. Bancorp Investments, Inc.
	 	$	12,000,000	 
	Total
	 	$	200,000,000	 
	 
	 	 	 	 

3

SCHEDULE II

Guarantors

	 	 	 
	Guarantor	 	Jurisdiction
	Abacus America, Inc.

	 	California
	Custom Direct, Inc.

	 	Delaware
	Custom Direct LLC

	 	Delaware
	Deluxe Business Operations, Inc.

	 	Delaware
	Deluxe Enterprise Operations, Inc.

	 	Minnesota
	Deluxe Financial Services, Inc.

	 	Minnesota
	Deluxe Manufacturing Operations, Inc.

	 	Minnesota
	Deluxe Small Business Sales, Inc.

	 	Minnesota
	Hostopia.com Inc.

	 	Delaware
	Safeguard Business Systems, Inc.

	 	Delaware
	Safeguard Holdings, Inc.

	 	Texas

SCHEDULE III

Significant Subsidiaries

Deluxe Business Operations, Inc.

Deluxe Enterprise Operations, Inc.

Deluxe Financial Services, Inc.

Deluxe Manufacturing Operations, Inc.

Deluxe Small Business Sales, Inc.

ANNEX A

Other Time of Sale Information

1. Pricing term sheet, substantially in the form of Annex B.

ANNEX B

Pricing Term Sheet

Pricing Supplement dated March 9, 2011

to Preliminary Offering Memorandum dated March 8, 2011

Strictly Confidential

DELUXE CORPORATION

$200,000,000 7.00% Senior Notes due 2019

This Pricing Supplement is qualified in its entirety by reference to the Preliminary Offering
Memorandum dated March 8, 2011 (the “Preliminary Offering Memorandum”). The information in this
Pricing Supplement supplements the Preliminary Offering Memorandum and updates and supersedes the
information in the Preliminary Offering Memorandum to the extent inconsistent with the information
in the Preliminary Offering Memorandum. Terms used herein and not defined herein have the meanings
assigned in the Preliminary Offering Memorandum.

The notes have not been registered under the Securities Act of 1933, as amended (the “Securities
Act”), or the securities laws of any other place. Unless they are registered, the notes may be
offered only in transactions that are exempt from registration under the Securities Act. We and the
initial purchasers are offering the notes only to qualified institutional buyers under Rule 144A
under the Securities Act (“Rule 144A”) and to persons outside the United States under Regulation S
under the Securities Act (“Regulation S”).

	 	 	 	 	 
	Issuer:	 	Deluxe Corporation

	 	 	 

	Security Description:	 	7.00% Senior Notes due 2019

	 	 	 

	Distribution:	 	144A and Regulation S with Registration Rights

	 	 	 

	Face:	 	$200,000,000

	 	 	 

	Gross Proceeds:	 	$200,000,000

	 	 	 

	Coupon:	 	7.00%

	 	 	 

	Maturity:	 	March 15, 2019

	 	 	 

	Offering Price:	 	100.00% of face amount

	 	 	 

	Yield to Maturity:	 	7.00%

	 	 	 

	Spread to Treasury:	 	+391 bps

	 	 	 

	Benchmark:	 	UST 2.75% due February 15, 2019

	 	 	 

	Interest Payment Dates:	 	March 15 and September 15

	 	 	 

	First Interest Payment Date:	 	September 15, 2011

	 	 	 

	Equity Clawback:	 	Up to 35% at 107.00% plus accrued and unpaid interest until March
15, 2014

	 	 	 

	Make-Whole Redemption:	 	Make-whole call @ Treasury Rate + 50 bps prior to March 15, 2015

	 	 	 

	Optional Redemption:	 	On and after March 15, 2015, at the prices set forth below
(expressed as a percentage of the principal amount), plus accrued
and unpaid interest, if redeemed during the twelve-month period
beginning on March 15 of the years indicated below:

	 	 	Date

	 	Price
	 	 	 

	 	 
	 	 	2015

2016

2017 and thereafter

	 	103.500%

101.750%

100.000%
	Change of Control Put:	 	Putable at 101% of principal amount thereof, plus accrued and
unpaid interest

	 	 	 

	Guarantees:	 	The notes will be fully and unconditionally guaranteed on a senior
unsecured basis by all of our existing and future restricted
subsidiaries that guarantee the Senior Credit Agreement or other
indebtedness of our company or the guarantors.

	 	 	 

	Trade Date:	 	March 9, 2011

	 	 	 

	Settlement:	 	(T+4) March 15, 2011

	 	 	 

	CUSIP:	 	Rule 144A: 248019AM3
Regulation S: U24789AD8 

	ISIN:	 	Rule 144A: US248019AM32
Regulation S: USU24789AD88

	 	 	 

	Denominations/Multiple:	 	$2,000/$1,000

	 	 	 

	Joint Book-Running Managers:	 	J.P. Morgan Securities LLC
Credit Suisse Securities (USA) LLC

	Co-Managers:	 	Mitsubishi UFJ Securities (USA), Inc.
Fifth Third Securities, Inc.
U.S. Bancorp Investments, Inc.

	Trustee:	 	U.S. Bank, National Association

__________________________________________________

This material is confidential and is for your information only and is not intended to be used
by anyone other than you. This information does not purport to be a complete description of these
securities or the offering. Please refer to the offering memorandum for a complete description.

This communication is being distributed in the United States solely to Qualified Institutional
Buyers, as defined in Rule 144A under the Securities Act of 1933, and outside the United States
solely to non-U.S. persons as defined under Regulation S.

This communication does not constitute an offer to sell or the solicitation of an offer to buy any
securities in any jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction.

ANNEX C

Restrictions on Offers and Sales Outside the United States

In connection with offers and sales of Securities outside the United States:

(a) Each Initial Purchaser acknowledges that the Securities have not been registered under the
Securities Act and may not be offered or sold within the United States or to, or for the account or
benefit of, U.S. persons except pursuant to an exemption from, or in transactions not subject to,
the registration requirements of the Securities Act.

(b) Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:

(i) Such Initial Purchaser has offered and sold the Securities, and will offer and sell
the Securities, (A) as part of their distribution at any time and (B) otherwise until 40
days after the later of the commencement of the offering of the Securities and the Closing
Date, only in accordance with Regulation S or Rule 144A or any other available exemption
from registration under the Securities Act.

(ii) None of such Initial Purchaser or any of its affiliates or any other person acting
on its or their behalf has engaged or will engage in any directed selling efforts with
respect to the Securities, and all such persons have complied and will comply with the
offering restrictions requirement of Regulation S.

(iii) At or prior to the confirmation of sale of any Securities sold in reliance on
Regulation S, such Initial Purchaser will have sent to each distributor, dealer or other
person receiving a selling concession, fee or other remuneration that purchases Securities
from it during the distribution compliance period a confirmation or notice to substantially
the following effect:

“The Securities covered hereby have not been registered under the U.S. Securities
Act of 1933, as amended (the “Securities Act”), and may not be offered or
sold within the United States or to, or for the account or benefit of, U.S. persons
(i) as part of their distribution at any time or (ii) otherwise until 40 days after
the later of the commencement of the offering of the Securities and the date of
original issuance of the Securities, except in accordance with Regulation S or Rule
144A or any other available exemption from registration under the Securities Act.
Terms used above have the meanings given to them by Regulation S.”

(iv) Such Initial Purchaser has not and will not enter into any contractual arrangement
with any distributor with respect to the distribution of the Securities, except with its
affiliates or with the prior written consent of the Company.

Terms used in paragraph (a) and this paragraph (b) and not otherwise defined in this Agreement have
the meanings given to them by Regulation S.

(c) Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:

(i) it has only communicated or caused to be communicated and will only communicate or
cause to be communicated any invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the United Kingdom Financial Services and Markets Act
2000 (the “FSMA”)) received by it in connection with the issue or sale of any
Securities in circumstances in which Section 21(1) of the FSMA does not apply to the Company
or the Guarantors; and

(ii) it has complied and will comply with all applicable provisions of the FSMA with
respect to anything done by it in relation to the Securities in, from or otherwise involving
the United Kingdom.

(d) Each Initial Purchaser acknowledges that no action has been or will be taken by the
Company that would permit a public offering of the Securities, or possession or distribution of any
of the Time of Sale Information, the Offering Memorandum, any Issuer Written Communication or any
other offering or publicity material relating to the Securities, in any country or jurisdiction
where action for that purpose is required.

4PURCHASE AND SALE AGREEMENT

                                    BETWEEN

                            J. M. HUBER CORPORATION

                                   AS SELLER

                                      AND

                             HIGH PLAINS GAS, INC.

                                    AS BUYER

                                     DATED:

                                FEBRUARY 2, 2011

<PAGE>
                               TABLE OF CONTENTS

                                                                    PAGE

ARTICLE 1 . .  ASSETS                                                  1
SECTION 1.01   AGREEMENT TO SELL AND PURCHASE                          1
SECTION 1.02   ASSETS                                                  1
SECTION 1.03   EXCLUDED ASSETS                                         3

ARTICLE 2      PURCHASE PRICE                                          5
SECTION 2.01   PURCHASE PRICE                                          5
SECTION 2.02   DEPOSIT                                                 5
SECTION 2.03   ALLOCATED VALUES                                        6

ARTICLE 3      EFFECTIVE TIME                                          7
SECTION 3.01   OWNERSHIP OF ASSETS                                     7

ARTICLE 4      TITLE AND ENVIRONMENTAL MATTERS                         7
SECTION 4.01   EXAMINATION PERIOD                                      7
SECTION 4.02   TITLE DEFECTS                                           7
SECTION 4.03   NOTICE OF TITLE DEFECTS                                 8
SECTION 4.04   REMEDIES FOR TITLE DEFECTS                             10
SECTION 4.05   SPECIAL WARRANTY OF TITLE                              11
SECTION 4.06   PREFERENTIAL RIGHTS TO PURCHASE                        13
SECTION 4.07   CONSENTS TO ASSIGNMENT                                 14
SECTION 4.08   [INTENTIONALLY OMITTED]                                15
SECTION 4.09   ENVIRONMENTAL REVIEW                                   15
SECTION 4.10   DEFINITIONS USED IN ARTICLE 4 AND IN THIS AGREEMENT    16
SECTION 4.11   NOTICE OF ENVIRONMENTAL DEFECTS                        17
SECTION 4.12   REMEDIES FOR ENVIRONMENTAL DEFECTS                     18
SECTION 4.13   INDEPENDENT EXPERTS                                    19
SECTION 4.14.  LIMITATION OF REMEDIES FOR TITLE DEFECTS AND
               ENVIRONMENTAL DEFECTS                                  20
SECTION 4.15   DISCLAIMER AND WAIVER                                  21

ARTICLE 5 . .  REPRESENTATIONS AND WARRANTIES OF SELLER               21
SECTION 5.01   EXISTENCE                                              21
SECTION 5.02   LEGAL POWER                                            21
SECTION 5.03   EXECUTION                                              22
SECTION 5.04   BROKERS                                                22
SECTION 5.05   BANKRUPTCY                                             22
SECTION 5.06   SUITS AND CLAIMS                                       22
SECTION 5.07   TAXES                                                  22
SECTION 5.08   AFES                                                   22

<PAGE>
Section 5.09   Compliance with Laws                                   23
SECTION 5.10   CONTRACTS                                              23
SECTION 5.11   PRODUCTION IMBALANCES                                  23
SECTION 5.12   PAYMENTS FOR PRODUCTION                                23
SECTION 5.13   BONDS                                                  23
SECTION 5.14   PERSONAL PROPERTY AND EQUIPMENT                        23
SECTION 5.15   TAX PARTNERSHIPS                                       23
SECTION 5.16   HYDROCARBON SALES CONTRACTS                            23
SECTION 5.17   AREA OF MUTUAL INTEREST AND OTHER AGREEMENTS           23
SECTION 5.18   LEASES                                                 24
SECTION 5.19   GOVERNMENTAL PERMITS                                   24
SECTION 5.20   NO ADVERSE CHANGE                                      24
SECTION 5.21   UNRECORDED INTERESTS                                   24
SECTION 5.22   PREFERENTIAL RIGHTS AND CONSENTS                       24
SECTION 5.23   DISCLOSURE OF ENVIRONMENTAL INFORMATION                24
SECTION 5.24   NOTICE OF CHANGE                                       24
SECTION 5.25   REPRESENTATIONS AND WARRANTIES EXCLUSIVE               24

ARTICLE 6 . .  REPRESENTATIONS AND WARRANTIES
               OF BUYER                                               25
SECTION 6.01   EXISTENCE                                              25
SECTION 6.02   LEGAL POWER                                            25
SECTION 6.03   EXECUTION                                              25
SECTION 6.04   BROKERS                                                25
SECTION 6.05   BANKRUPTCY                                             25
SECTION 6.06   SUITS AND CLAIMS                                       25
SECTION 6.07   INDEPENDENT EVALUATION                                 26
SECTION 6.08   QUALIFICATION                                          26
SECTION 6.09   SECURITIES LAWS                                        26
SECTION 6.10   NO INVESTMENT COMPANY                                  26
SECTION 6.11   FUNDS                                                  26
SECTION 6.12   NOTICE OF CHANGES                                      26
SECTION 6.13   REPRESENTATIONS AND WARRANTIES EXCLUSIVE               27

ARTICLE 7      OPERATION OF THE ASSETS                                27
SECTION 7.01   OPERATION OF THE ASSETS                                27
SECTION 7.02   BUYER'S QUALIFICATION                                  28
SECTION 7.03   OPERATION OF THE ASSETS AFTER THE CLOSING              28
SECTION 7.04   PUBLIC ANNOUNCEMENTS                                   28

ARTICLE 8      CONDITIONS TO OBLIGATIONS OF SELLER                    28
SECTION 8.01   REPRESENTATIONS                                        29
SECTION 8.02   PERFORMANCE                                            29
SECTION 8.03   PENDING MATTERS                                        29

<PAGE>
Article 9      Conditions to Obligations of Buyer                     29
SECTION 9.01   REPRESENTATIONS                                        29
SECTION 9.02   PERFORMANCE                                            29
SECTION 9.03   PENDING MATTERS                                        29

ARTICLE 10     THE CLOSING                                            29
SECTION 10.01  TIME AND PLACE OF THE CLOSING                          29
SECTION 10.02  ALLOCATION OF COSTS AND EXPENSES AND ADJUSTMENTS
               TO PURCHASE PRICE AT THE CLOSING                       30
SECTION 10.03  CLOSING ADJUSTMENTS AND ALLOCATIONS STATEMENT          31
SECTION 10.04  POST-CLOSING ALLOCATIONS AND ADJUSTMENTS
               TO PURCHASE PRICE                                      31
SECTION 10.05  TRANSFER TAXES                                         33
SECTION 10.06  AD VALOREM AND SIMILAR TAXES                           33
SECTION 10.07  ACTIONS OF SELLER AT THE CLOSING                       33
SECTION 10.08  ACTIONS OF BUYER AT THE CLOSING                        34
SECTION 10.09  RECORDATION; FURTHER ASSURANCES                        34

ARTICLE 11     TERMINATION                                            35
SECTION 11.01  RIGHT OF TERMINATION                                   35
SECTION 11.02  EFFECT OF TERMINATION                                  35
SECTION 11.03  ATTORNEYS' FEES, ETC                                   36

ARTICLE 12     ASSUMPTION AND INDEMNIFICATION                         36
SECTION 12.01  BUYER'S OBLIGATIONS AFTER CLOSING                      36
SECTION 12.02  SELLER'S OBLIGATIONS AFTER CLOSING                     37
SECTION 12.03  PLUGGING AND ABANDONMENT OBLIGATIONS                   37
SECTION 12.04  ENVIRONMENTAL OBLIGATIONS                              38
SECTION 12.05  DEFINITION OF CLAIMS                                   39
SECTION 12.06  APPLICATION OF INDEMNITIES                             39
SECTION 12.07  BUYER'S INDEMNITY                                      40
SECTION 12.08  SELLER'S INDEMNITY                                     40
SECTION 12.09  NOTICES AND DEFENSE OF INDEMNIFIED CLAIMS              40
SECTION 12.10  SURVIVAL                                               41
SECTION 12.11  LIMITATION ON SELLER'S INDEMNITY                       41
SECTION 12.12  EXCLUSIVE REMEDY                                       41
SECTION 12.13  DEFENSES AND COUNTERCLAIMS                             41
SECTION 12.14  ANTI-INDEMNITY STATUTE                                 42

ARTICLE 13.    DISCLAIMERS; CASUALTY LOSS AND CONDEMNATION            42
SECTION 13.01  DISCLAIMERS OF REPRESENTATIONS AND WARRANTIES          42
SECTION 13.02  NORM                                                   43
SECTION 13.03  CASUALTY LOSS; CONDEMNATION                            44

<PAGE>
Article 14     Miscellaneous                                          44
SECTION 14.01  NAMES                                                  44
SECTION 14.02  EXPENSES                                               44
SECTION 14.03  DOCUMENT RETENTION                                     45
SECTION 14.04  ENTIRE AGREEMENT                                       45
SECTION 14.05  WAIVER                                                 45
SECTION 14.06  CONSTRUCTION                                           45
SECTION 14.07  NO THIRD PARTY BENEFICIARIES                           45
SECTION 14.08  ASSIGNMENT                                             45
SECTION 14.09  GOVERNING LAW; VENUE                                   46
SECTION 14.10  NOTICES                                                46
SECTION 14.11  SEVERABILITY                                           47
SECTION 14.12  INTERPRETATION                                         47
SECTION 14.13  CONSPICUOUSNESS                                        49
SECTION 14.14  DECEPTIVE TRADE PRACTICES WAIVER                       49
SECTION 14.15  TIME OF THE ESSENCE                                    49
SECTION 14.16  COUNTERPART EXECUTION                                  49

<PAGE>
                             EXHIBITS AND SCHEDULES

Exhibit A             Subject Interests and Surface Agreements
Exhibit B             Wells
Exhibit C             Allocated Values
Exhibit D             Form of Assignment and Bill of Sale
Exhibit E             Form of Mineral Quitclaim Deed
Exhibit F             Transition Matters
Exhibit G             Form of Assignment Agreement
Exhibit H             Form of Parent Guarantee

Schedule 1.03(m)      Excluded Electronic Equipment
Schedule 4.06         Rights of Preferential Purchase
Schedule 4.07         Consents to Assignment
Schedule 5.06         Litigation
Schedule 5.07         Pending Tax Audits
Schedule 5.08         Authorizations for Expenditures
Schedule 5.13         Bonds
Schedule 5.16         Hydrocarbon Sales Agreements
Schedule 7.01(a)(iv)  Pending Contract Matters

<PAGE>
                             TABLE OF DEFINED TERMS

Agreement. . . . . . . . . .    1  Lands                                   1
Allocated Values . . . . . .    6  Laws                                   12
Assets . . . . . . . . . . .    1  Lease and Leases                        1
Assignment . . . . . . . . .   11  Marketable Title                        7
Assignment Agreement . . . .   45  material                               48
Assumed Obligations. . . . .   36  Material Adverse Effect                48
Breach . . . . . . . . . . .   48  Mineral Quitclaim Deed                 11
Buyer. . . . . . . . . . . .    1  NORM                                   43
Buyer's Environmental Review   15  Notice of Disagreement                 31
Casualty . . . . . . . . . .   44  OPA                                    17
Casualty Loss. . . . . . . .   44  Parent Guarantee                       34
CERCLA . . . . . . . . . . .   16  Party                                   1
Claims . . . . . . . . . . .   39  PDNP                                    6
Closing. . . . . . . . . . .   30  Permits                                 2
Closing Date . . . . . . . .   30  Permitted Encumbrances                 11
Contracts. . . . . . . . . .    3  Plugging and Abandonment
Deposit. . . . . . . . . . .    5  Obligations                            37
Documents. . . . . . . . . .   45  Probable and/or Possible Locations      6
Effective Time . . . . . . .    7  PUD Locations                           6
Environmental Defect . . . .   16  Purchase Price                          5
Environmental Defect Value .   17  Purchase Price Allocations and
Environmental Information. .   16  Adjustments                            31
Environmental Laws . . . . .   16  RCRA                                   16
Environmental Obligations. .   38  Records                                 3
Equipment. . . . . . . . . .    2  Representatives                        39
Examination Period . . . . .    7  Retained Obligations                   37
Excluded Assets. . . . . . .    3  Seller                                  1
Expiration Date. . . . . . .   41  Statement                              31
Facilities . . . . . . . . .    2  Subject Interest or Subject Interests   2
Final Settlement Date. . . .   31  Surface Agreements                      2
Final Settlement Statement .   31  Tax                                    48
Governmental Authority . . .   16  Title Claim Date                        8
Hydrocarbons . . . . . . . .    1  Title Defect                            7
includes or including. . . .   48  Title Defect Value                      8
Independent Expert . . . . .   19  Wells                                   2
knowledge or knowingly . . .   48  WYOMING INVENTORY                       2

<PAGE>

                          PURCHASE AND SALE AGREEMENT

This  Purchase  and  Sale  Agreement (this "Agreement") is made and entered into
this  2nd  day  of  February, 2011, by and between J.M. HUBER CORPORATION, a New
Jersey  corporation  ("Seller"), and HIGH PLAINS GAS, INC., a Nevada corporation
("Buyer").  Buyer  and  Seller  are  collectively  referred  to  herein  as  the
"Parties,"  and  are  sometimes  referred  to  individually  as  a  "Party."

                                R E C I T A L S:

WHEREAS,  Seller  desires  to  sell to Buyer, and Buyer desires to purchase from
Seller,  the  Assets  (as  defined  below),  all  upon  the terms and conditions
hereinafter  set  forth;

NOW,  THEREFORE,  in consideration of Ten Dollars ($10.00) cash in hand paid and
of  the  mutual  benefits  derived and to be derived from this Agreement by each
Party,  and  for  other  good  and  valuable  consideration,  the  receipt  and
sufficiency  of  which are hereby acknowledged, Seller and Buyer hereby agree as
follows:

                                   ARTICLE  1

                                     ASSETS

SECTION  1.01     Agreement  to Sell and Purchase.  Subject to and in accordance
with  the  terms  and conditions of this Agreement, Buyer agrees to purchase the
Assets  from  Seller,  and  Seller  agrees  to  sell  the  Assets  to  Buyer.

SECTION  1.02     Assets.  Subject to Section 1.03, the term "Assets" shall mean
all  of  Seller's  right,  title  and  interest  in  and  to:

(a)     The  oil,  gas  and  other  mineral  leases  described  on  Exhibit  A
(collectively, the "Leases" and singularly a "Lease") and any overriding royalty
interests,  royalty  interests,  fee  mineral  interests, non-working or carried
interests,  operating  rights,  record  title  and  other  rights  and interests
described  in  Exhibit  A,  together  with  the lands covered thereby or pooled,
communitized or unitized therewith (the "Lands"), but excluding any specifically
described  depths  or intervals set forth in Exhibit A, however including in the
defined terms Leases and Lands the following:  (i) all right, title and interest
of  Seller  in  and to any other mineral interests of any nature (A) located in,
on,  or  under  the  Lands,  or  (B)  which are attributable to the proration or
spacing  unit or designated pooled or communitized unit for any of the Wells (as
hereinafter  defined),  in each case whether or not described in or omitted from
Exhibit  A, (ii) all rights with respect to any pooled, communitized or unitized
interest  or  contract area under any effective operating agreement by virtue of
any Leases and Lands or the interests described in clause (i) above being a part
thereof,  and  (iii)  all  production  of  oil, gas (including coalbed methane),
associated  liquids,  other  hydrocarbons  and  other lease substances under the
Leases  (collectively "Hydrocarbons") from and after the Effective Time from the
Leases  and  the

<PAGE>
Lands,  and from any such pooled, communitized, or unitized interest or affected
contract  area  and  allocated  to  any  such  Leases and Lands or the interests
described  in  clause (i) above (the Leases, the Lands, and the rights described
in  clauses  (i)  and (ii) above, and the Hydrocarbons described in clause (iii)
above, being collectively referred to as the "Subject Interests" or, singularly,
a  "Subject  Interest");

(b)     all  easements,  rights-of-way,  servitudes, surface leases, surface use
agreements,  water management or handling agreements, water disposal agreements,
agreements  pertaining  to water wells and other rights or agreements related to
the  use  of the surface and subsurface (the "Surface Agreements"), in each case
to  the  extent  used in connection with the operation of the Subject Interests,
recorded  or unrecorded, including those Surface Agreements described in Exhibit
A;

(c)     to the extent assignable or transferable, all permits (including without
limitation  those  relating  to the production or discharge of water), licenses,
franchises,  consents,  approvals,  and other similar rights and privileges (the
"Permits"),  in each case to the extent used in connection with the operation of
the  Subject  Interests;

(d)     all  equipment,  machinery,  fixtures,  spare  parts,  the  inventory at
Seller's Gillette and Sheridan, Wyoming storage yards (the "Wyoming Inventory"),
other  inventory,  and  other  personal  property  (including Seller's leasehold
interests  therein  subject  to  any  necessary  consents to assignment) used in
connection with the operation of the Subject Interests or in connection with the
production, treatment, compression, gathering, transportation, sale, or disposal
of  Hydrocarbons  and  any  water,  by-products  or  waste produced therewith or
otherwise attributable to the Subject Interests (collectively, "Equipment"); all
wells  located  on  the Leases or the Lands or on lands pooled, communitized, or
unitized  therewith  or  on  any  contract  area  under  an  effective operating
agreement  that  affects  the Leases or Lands and whether producing, shut in, or
abandoned,  and  whether for production, monitoring, produced water injection or
disposal,  or  otherwise, and including without limitation those Wells described
in Exhibit B (collectively, the "Wells") together with all of Seller's interests
within  the  spacing,  producing,  proration,  federal  exploratory,  enhanced
recovery,  or  governmentally  prescribed  unit  attended to the Wells, wellhead
equipment,  telemetry  and  SCADA  equipment,  pumps,  pumping units, flowlines,
gathering  systems,  pipe,  tanks,  treatment  facilities, injection facilities,
disposal  facilities,  compression  facilities,  and other materials, furniture,
supplies,  buildings, vehicles, trailers, and offices located in Houston, Texas,
Sheridan,  Wyoming  and  Denver,  Colorado  used  in connection with the Subject
Interests  and  the  other  matters  described in this definition of Assets (the
"Facilities");

(e)     to  the  extent  assignable or transferable, (i) all Surface Agreements,
contracts,  agreements,  drilling  contracts, equipment leases, production sales
and  marketing contracts, farm-out and farm-in agreements, operating agreements,
unit  agreements,  gas  gathering  and  transportation  agreements  and  other
contracts,  agreements,  and arrangements, relating to the Subject Interests and
the other matters described in this definition of Assets, and subject to, and in
accordance  with,  any  limitations set forth in such agreements, (ii) equipment
leases  and  rental  contracts, supply agreements, and (iii) the leases covering
the  Houston,  Texas,  Denver,  Colorado,  and  Sheridan,  Wyoming

<PAGE>
offices,  and  other  contracts,  agreements,  and  arrangements relating to the
Subject  Interests  and the other matters described in this definition of Assets
(the  agreements  identified  in  clauses  (i),  (ii)  and  (iii)  above  being,
collectively,  the  "Contracts");  and

(f)     all files, records, and data relating to the items described in Sections
1.02(a)  through  (e)  maintained  by  Seller including, without limitation, the
following,  if  and  to  the  extent that such files exist:  all books, records,
reports,  manuals, files, title documents (including correspondence), records of
production  and  maintenance, revenue, sales, expenses, warranties, lease files,
land  files,  well  files,  division  order  files,  abstracts,  title opinions,
assignments, reports, property records, contract files, operations files, copies
of  tax  and  accounting  records  (but  excluding  Federal and state income tax
returns  and  records)  and files, maps, core data, gas content data, coal yield
and  thickness  data,  Hydrocarbon  analysis, well logs, mud logs, field studies
together  with  other files, contracts, and other records and data including all
geologic  (but  not geophysical) data and maps, but excluding from the foregoing
those  files,  records,  and  data  subject  to written unaffiliated third party
contractual  restrictions  on  disclosure  or  transfer (the "Records").  To the
extent  that any of the Records contain interpretations of, or analyses prepared
by,  Seller,  Buyer  agrees to rely on such interpretations at its sole risk and
without  any  duty  on  the  part  of  Seller  regarding  such  interpretations.

SECTION  1.03     Excluded  Assets.  Notwithstanding  the  foregoing, the Assets
shall  not  include, and there is excepted, reserved and excluded from the sale,
transfer  and  assignment contemplated hereby the following excluded properties,
rights  and  interests  (collectively,  the  "Excluded  Assets"):

(a)     all  trade credits and all accounts, instruments and general intangibles
attributable  to  the  Assets  with  respect  to any period of time prior to the
Effective  Time;

(b)     all  rights  or  Claims  of  Seller  against  any  third  party,

     (i)  arising from acts, omissions or events, or damage to or destruction of
property,  occurring  prior  to  the  Effective  Time,

     (ii)  arising  under  or  with  respect  to  any  of the Contracts that are
attributable  to  periods  of time prior to the Effective Time (including Claims
for  adjustments  or  refunds),  or

     (iii)  with  respect  to  any  of  the  other  Excluded  Assets;

(c)     all  rights  and  interests  of  Seller,

     (i) under any policy or agreement of insurance or indemnity,

     (ii) under any bond, or

<PAGE>
     (iii)  to  any insurance or condemnation proceeds or awards arising in each
case  from  acts,  omissions or events, or damage to or destruction of property,
occurring  prior  to  the  Effective  Time;

(d)     all  Hydrocarbons produced from or otherwise attributable to the Subject
Interests with respect to all periods prior to the Effective Time, together with
all  proceeds  from  the  sale  of  such  Hydrocarbons,  and  all  Tax  credits
attributable  thereto;

(e)     all  Claims of Seller for refunds of or loss carry forwards with respect
to

     (i)  ad  valorem, severance, production, or any other Taxes attributable to
any  period  prior  to  the  Effective  Time,

     (ii)  income,  gross  margin,  or  franchise  Taxes,

     (iii)  any  Taxes attributable to the other Excluded Assets, and such other
refunds,  and rights thereto, for amounts paid in connection with the Assets and
attributable  to  the  period  prior to the Effective Time, including refunds of
amounts  paid  under  any  gas  gathering  or  transportation  agreement;

(f)     all  amounts  due  or  payable  to  Seller  as  adjustments to insurance
premiums related to the Assets with respect to any period prior to the Effective
Time;

(g)     all  proceeds,  income,  or revenues (and any security or other deposits
made)  attributable to the Assets for any period prior to the Effective Time, or
any  other  Excluded  Assets;

(h)     subject  to  Section 1.02(f), all of Seller's proprietary technology and
improvements,  computer  software,  patents,  trade  secrets, copyrights, names,
trademarks,  logos,  and  other  intellectual  property;

(i)     all  documents  and  instruments  of  Seller  that  are  protected by an
attorney-client  or  other  privilege, provided that said privilege has not been
waived;

(j)     data,  information, and other property, rights, or interests that cannot
be  disclosed  or assigned to Buyer as a result of a license, confidentiality or
similar  arrangement;

(k)     all  proprietary geophysical and seismic data that has been collected or
obtained  from any seismic surveys or gravity meter surveys covering any portion
of  the  Lands,  including  any  processed  or  reprocessed  data.

(l)     all  audit  rights  arising under any of the Contracts or otherwise with
respect  to  any  period  prior  to  the  Effective  Time or to any of the other
Excluded  Assets;

(m)     all  computers,  printers,  and  other  electronic  equipment  listed on
Schedule  1.03(m)  located in any buildings, offices or trailers that may belong
to  Seller  and  that may constitute part of the Assets, including, all software
and  electronic  data

<PAGE>
relating  in  any  way to such electronic equipment (but not the telemetry/SCADA
system  included  in  the  Assets);

(n)     All  corporate, income tax, and financial records of Seller not included
in  the  Records;  and

(o)     all  agreements  providing  for  options,  swaps, floors, caps, collars,
forward  sales,  or forward purchases involving commodities or commodity prices,
or  indexes  based  on any of the foregoing and all other similar agreements and
arrangements.

                                   ARTICLE  2

                                 PURCHASE PRICE

SECTION  2.01     Purchase  Price.  The  total  consideration  for the purchase,
sale,  and  conveyance  of  the  Assets  to  Buyer and Buyer's assumption of the
Assumed Obligations and all other liabilities provided for in this Agreement, is
Buyer's  payment  to  Seller  of  the  sum  of  Thirty-Five  Million  Dollars
($35,000,000)  (the  "Purchase  Price"),  as  adjusted  in  accordance  with the
provisions  of  this  Agreement.

SECTION  2.02     Deposit.

(a)     Buyer  shall  deliver  to  Seller  a performance guarantee deposit in an
amount  equal  to Two Million Dollars ($2,000,000) (the "Deposit") in accordance
with wire transfer instructions timely provided by Seller to Buyer.  The Deposit
shall  be  delivered  as  follows:

     (i)  Concurrently  with  this  Agreement  by  Buyer and Seller, Buyer shall
deliver  to  Seller One Million Dollars ($1,000,000.00) in immediately available
funds.  If  this  portion of the Deposit is not timely delivered to Seller, this
Agreement  shall automatically terminate, and neither Party shall have rights or
obligations  hereunder;  and

     (ii)  On  or before the close of business on February 20, 2011, Buyer shall
deliver  to  Seller  in  immediately  available  funds  One  Million  Dollars
($1,000,000.00).  If  this  portion  of  the  Deposit is not timely delivered to
Seller,  Seller  may  retain the initial portion of the Deposit paid pursuant to
Section  2.02(a)(i) as liquidated damages and terminate this Agreement, in which
event  neither  Party shall have any rights or obligations under this Agreement;
provided, however, Buyer's obligations under Section 4.09(a)(viii) shall survive
such  termination.

(b)     Subject  to the proviso set forth in Section 11.01, if this Agreement is
terminated by Seller pursuant to Section 11.01(b) or Section 11.01(d) and Seller
does  not

<PAGE>
waive  the non-satisfaction of any conditions to Closing set forth in Article 8,
Seller  shall  retain  the  Deposit  as  liquidated  damages.  Buyer  and Seller
acknowledge  and agree that (i) Seller's actual damages upon the event of such a
termination are difficult to ascertain with any certainty, (ii) the Deposit is a
reasonable estimate of such actual damages, and (iii) such liquidated damages do
not  constitute  a  penalty.

(c)     Subject  to the proviso set forth in Section 11.01, if this Agreement is
terminated  (i)  by  Buyer pursuant to Section 11.01(c) and Buyer does not waive
the non-satisfaction of any conditions to Closing set forth in Article 9 or (ii)
by  Buyer  or  Seller  pursuant  to  Section 11.01(a), Section 11.01(e), Section
11.01(f),  Section  11.01(g),  or  Section  13.03(c), then Seller shall promptly
return  the  Deposit  to  Buyer  in immediately available funds pursuant to wire
transfer  instructions to be provided timely by Buyer to Seller within three (3)
business  days after the event giving rise to such return obligation.  Buyer and
Seller  shall  thereupon  have  the  rights  and obligations set forth elsewhere
herein.

(d)     If  all  conditions  precedent to the obligations of Seller set forth in
Article 8 have been met, then notwithstanding any provision in this Section 2.02
to  the  contrary,  if Closing does not occur because Seller wrongfully fails to
tender  performance at Closing or otherwise Breach this Agreement in any respect
prior  to  Closing,  and  Buyer is ready and otherwise able to close, at Buyer's
sole  election, either (i) Seller shall return the Deposit to Buyer within three
(3)  business  days  after the determination that the Closing will not occur, or
(ii)  Buyer  shall  have  the  right  to  pursue  specific  performance  of this
Agreement,  provided  that  Buyer  must  file an action for specific performance
within  21  days  of  Seller's  Breach.  If  Buyer  elects  to  pursue  specific
performance,  Buyer  must  pursue specific performance as its sole and exclusive
remedy  in  lieu  of all other legal and equitable remedies.  If such action for
specific  performance is not filed within 21 days of Seller's Breach or if Buyer
is  unsuccessful  for any reason other than a Breach of this Agreement by Buyer,
Buyer  shall  be  deemed to have waived all legal and equitable remedies and its
sole remedy for Seller's Breach of this Agreement shall be limited to the prompt
return  of  the  Deposit.

SECTION  2.03     Allocated  Values.  The  Purchase Price is allocated among the
Assets  (including  the Wells, PUD Locations, PDNP, and Probable and/or Possible
Locations)  as  set  forth  in  Exhibit C (the "Allocated Values").  In no event
shall  the  aggregate of the Allocated Values of any Wells, PUD Locations, PDNP,
and  Probable  and/or  Possible  Locations exceed the unadjusted Purchase Price.
The term "PUD Locations" means those Proved Undeveloped potential well locations
specifically  identified  in  Exhibit C.  The term "PDNP" means Proved Developed
Not  Producing  intervals  as  specifically  identified  on Exhibit C.  The term
"Probable  and/or  Possible  Locations"  means  those  locations  specifically
identified and designated as such on Exhibit C.  Seller and Buyer agree that the
Allocated  Values shall be used to compute any adjustments to the Purchase Price
pursuant  to  the provisions of Article 4.  Any adjustment to the Purchase Price
hereunder shall be reflected in the allocation set forth in Exhibit C consistent
with  Treasury  Regulation  Section 1.1060-IT(f).  For tax purposes, the Parties
agree  to  report  the  transactions  contemplated by this Agreement in a manner
consistent with the terms of this Agreement, including the allocations set forth
above  as

<PAGE>
of  the Closing Date, and that neither Party will take any position inconsistent
therewith, including in any tax return, refund claim, litigation, arbitration or
otherwise.  Notwithstanding  the foregoing, on Exhibit C there shall be a single
line  item  for  the  Allocated  Value  for  the  Wyoming  Inventory.

                                   ARTICLE  3

                                 EFFECTIVE TIME

SECTION  3.01     Ownership  of Assets.  If the transactions contemplated hereby
are  consummated  in  accordance  with  the  terms  and  provisions  hereof, the
ownership of the Assets shall be transferred from Seller to Buyer on the Closing
Date,  but effective for all purposes as of 7:00 a.m. local time at the location
of  the  Assets  on  December  1,  2010  (the  "Effective  Time").

                                   ARTICLE  4

                        TITLE AND ENVIRONMENTAL MATTERS

SECTION 4.01     Examination Period.  From the date of this Agreement until 5:00
p.m.  CST  on  the  date  which is seven (7) days prior to the Closing Date (the
"Examination  Period"),  Seller shall permit Buyer and/or its representatives to
examine,  and  Seller  shall  cooperate with and make available to Buyer and its
representatives  during  normal business days and hours at a location designated
by  Seller, all abstracts of title, title opinions, title files, ownership maps,
lease,  Well  and  division  order files, assignments, operating, and accounting
records  and  all  Surface Agreements, Permits, Contracts, and other agreements,
data, analyses, and information pertaining to the Assets insofar as same may now
be  in  existence  and in the possession of Seller, subject to such restrictions
upon  disclosure  as may exist under confidentiality or other agreements binding
upon  Seller  and  relating  to  such  data.  If  any  such items are subject to
restrictions on disclosure to Buyer, then Seller shall use reasonable efforts to
obtain  waivers  of  such  restrictions sufficient to permit Buyer to review the
items.  If  unable  to lift such restrictions, Seller shall disclose to Buyer so
much  of  any such item as it may without violating the restrictions and, to the
extent  allowed  under the restrictions, describe to Buyer the general nature of
any  such  restricted  disclosure  item.

SECTION  4.02     Title  Defects.  The  term  "Title  Defect"  means  (a)  any
encumbrance  on,  encroachment  on,  irregularity in, defect in, or objection to
Seller's  ownership of the Assets (excluding Permitted Encumbrances) that causes
Seller  not  to  have  Marketable  Title  to a Well, a PUD Location, a PDNP or a
Probable  and/or Possible Location as described in Exhibit C; or (b) any default
by Seller under a lease, farm-out agreement, or other contract or agreement that
would  (i) have a material and adverse effect on the operation, value, or use of
such  Asset,  (ii)  prevent  Seller  from  receiving  the proceeds of production
attributable  to  Seller's  interest therein, or (iii) result in cancellation of
all  or  a  portion  of  Seller's interest therein.  The term "Marketable Title"
means such ownership by Seller in the Assets that, subject to and except for the
Permitted  Encumbrances:

<PAGE>
(a)     entitles  Seller  to  receive  not less than the percentage set forth in
Exhibit  C  as  the  Seller's Net Revenue Interest of all Hydrocarbons produced,
saved  and  marketed  from  such  Well,  PUD  Location, PDNP, or Probable and/or
Possible Locations described in such exhibit, all without reduction, suspension,
or  termination  of  such  interest throughout the productive life of such Well,
except  as  specifically  set  forth  in  such  exhibit;

(b)     obligates  Seller  to  bear not greater than the percentage set forth in
Exhibit C as the Seller's Working Interest of the costs and expenses relating to
the maintenance, development, and operation of such Well, PUD Location, PDNP, or
Probable  and/or  Possible  Locations,  all  without  increase  throughout  the
productive life of such Well, except as specifically set forth in either of such
exhibits;  and

(c)     is  free  and  clear  of  all liens, encumbrances, and defects in title.

Subject to the limitations of Section 4.14, Breaches of Seller's representations
and  warranties contained in Section 5.07 through Section 5.24 (other than those
also  constituting  Title  Defects and Environmental Defects which are addressed
elsewhere in this Agreement) discovered prior to the Closing shall be treated as
Title  Defects  for  purposes  of making pre-Closing adjustments to the Purchase
Price.

SECTION 4.03     Notice of Title Defects.  In order to exercise its rights under
this  Section,  Buyer  shall provide Seller notice of all Title Defects no later
than  5:00 p.m. CST on March 8, 2011 (the "Title Claim Date").  To be effective,
such notice must (a) be in writing, (b) be received by Seller on or prior to the
Title  Claim Date, (c) describe the Title Defect in reasonable detail (including
any  alleged  variance  in  the  Net  Revenue Interest or Working Interest), (d)
identify the specific Asset or Assets affected by such Title Defect, (e) include
the Title Defect Value, as reasonably determined by Buyer in good faith, and (f)
comply  with  the limitations and Title Defect Value qualifications set forth in
Section  4.14.  Any  matters  that constitute Title Defects, but of which Seller
has  not  been  specifically notified by Buyer in accordance with the foregoing,
shall  be  deemed  to  have  been  waived  by  Buyer  for all purposes and shall
constitute  Permitted  Encumbrances  and  Assumed  Obligations  hereunder.  Upon
receipt  of  notices of Title Defects, the Parties shall meet and determine upon
which of the Title Defects, Title Defect Values, and methods of cure the Parties
have  reached  agreement.  Upon  the  receipt  of such notice from Buyer, Seller
shall  have  the option, but not the obligation, for a period ending ninety (90)
days  after the Closing to cure such defect.  If Seller should not elect to cure
a  Title  Defect,  and  no  aspect  of such defect is reasonably in dispute, the
Purchase  Price  shall  be  adjusted  for such defect by the amount of the Title
Defect  Value.

(a)     The  value  attributable to each Title Defect (the "Title Defect Value")
that  is asserted by Buyer in the Title Defect notices shall be determined based
upon  the  criteria  set  forth  below:

     (i) If the Title Defect is a lien upon any Asset, the Title Defect Value is
the  amount  necessary  to  be  paid to remove the lien from the affected Asset;

<PAGE>
     (ii)  If  the  Title  Defect  asserted  is  that  the  Net Revenue Interest
attributable  to  any  Well,  PUD  Location,  PDNP,  or Probable and/or Possible
Locations  is  less  than  that stated in Exhibit C, then the Title Defect Value
shall  be  the absolute value of the number determined by the following formula:

          Title Defect Value = A x (1-[B/C])

          A = Allocated Value for the affected Asset

          B = Correct Net Revenue Interest for the affected Asset

          C = Net Revenue Interest for the affected Asset as set forth on
          Exhibit C.

     (iii) If the Title Defect represents an obligation, encumbrance, burden, or
charge  upon  the affected Asset (including any increase in Working Interest for
which  there  is not a proportionate increase in Net Revenue Interest) for which
the  economic detriment to Buyer is unliquidated, the amount of the Title Defect
Value  shall  be  determined  by  taking into account the Allocated Value of the
affected Asset, the portion of the Asset affected by the Title Defect, the legal
effect  of  the  Title  Defect,  the potential discounted economic effect of the
Title  Defect  over  the life of the affected Asset, and the Title Defect Values
placed  upon  the  Title  Defect  by  Buyer  and  Seller;

     (iv)  If  a  Title  Defect is not in effect or does not adversely affect an
Asset  throughout  the entire post Effective Time productive life of such Asset,
such  fact  shall  be  taken into account in determining the Title Defect Value;

     (v)  The  Title  Defect Value of a Title Defect shall be determined without
duplication  of  any  costs  or  losses  included  in another Title Defect Value
hereunder;

     (vi)  Notwithstanding  anything herein to the contrary, in no event shall a
Title Defect Value exceed the Allocated Value of the Wells, PUD Locations, PDNP,
Probable  and/or  Possible  Locations,  or  other  Assets  affected  thereby;

     (vii) If the Title Defect Value of an Asset is equal to the Allocated Value
of  such  Asset,  the  affected  Asset  shall  remain  in  the purchase and sale
contemplated  by  this  Agreement,  but  the  Purchase  Price  shall be adjusted
accordingly;

     (viii) Notwithstanding the provisions of this Section 4.03 to the contrary,
the  Title  Defect  Value  of any Title Defect comprising a required consent not
obtained  (other  than  consents  customarily  obtained  after Closing) shall be
determined  subject  to  any accommodation implemented pursuant to Section 4.07;
and

<PAGE>
     (ix)  Such  other  factors  as  are  reasonably  necessary to make a proper
evaluation.

(b)     The  term  Title  Defect  shall  not  include:

     (i)  Defects  based  solely  on  an  assertion  that  Seller's  files  lack
information,  provided  that any missing material information can be obtained by
the  reasonable  efforts  of  Buyer;

     (ii)  Defects  in  the  early  chain  of title consisting of the failure to
recite  marital  status  in a document or omissions of successors of heirship or
estate  proceedings,  unless Buyer provides a reasonable basis for the assertion
that  such  failure  or  omission  has  resulted  in  a third party's actual and
superior  claim  of  title  to  the  affected  Asset;

     (iii)  Defects  arising  out  of  lack  of  survey;

     (iv) Defects arising out of lack of corporate or other entity authorization
unless  Buyer  provides a reasonable basis for the assertion that the action was
not  authorized  and  that  such  lack  of authorization has resulted in a third
party's  actual  and  superior  claim  of  title  to  the  affected  Asset;

     (v)  [Intentionally  Omitted]

     (vi)  Defects  asserting  a change in an applicable Working Interest or Net
Revenue  Interest  based  on  a  change  in  drilling  and  spacing units, tract
allocation or other changes in pooling or unit participation occurring after the
date  of  this  Agreement;

     (vii) Those matters that do not impair marketability in accordance with the
applicable title standards for the State in which the affected Asset is located;

     (viii)  Title  requirements customarily considered as advisory or which can
be  waived  as  a  matter  of  prudent  business  judgment;  and

     (ix)  The  lack  of title in the name of Seller as to those Assets in which
Seller's  rights and interest are created by an operating agreement or any other
instrument  by which Seller has rights or interests, or has the right to acquire
other  interests.

SECTION  4.04     Remedies  for  Title  Defects.

(a)     For  any Title Defect noticed pursuant to Section 4.03 that has not been
cured  at  or  prior  to  Closing,  the  Purchase  Price  shall,  subject to the
provisions of Section 4.14, be decreased at Closing by either (i) the amount the
Parties  acting  reasonably  and  in  good  faith agree in lieu of a cure of the
asserted  Title  Defect,  or (ii) with respect to any Title Defect for which the
Parties  have  not  yet  agreed  as  to  the

<PAGE>
validity  of  the  Title  Defect, the Title Defect Value, or the manner of cure,
then  by the amount of the Title Defect Value asserted by Buyer for such uncured
or  unadjusted  Title  Defect.

(b)     Notwithstanding  anything  to  the contrary in this Section 4.04, if any
Title Defect is in the nature of a consent to assignment that is not obtained or
other  restriction  on  assignment,  the provisions of Section 4.07 shall apply.

(c)     If at the expiration of thirty (30) days after Closing, the Parties have
not  agreed upon the validity of any asserted Title Defect, the appropriate cure
of  the same, or the Title Defect Value attributable thereto, either Party shall
have  the  right  to elect to have any such dispute determined by an Independent
Expert  pursuant  to  Section  4.13.

(d)     Once  a  Title Defect is cured by Seller at its sole cost and expense to
Buyer's  reasonable  satisfaction, or the existence or value of the Title Defect
is  determined with finality either by agreement between the affected Parties or
in  accordance  with Section 4.13, Buyer shall promptly pay to Seller (i) in the
case  of  a  Title  Defect  which  is  cured,  the amount the Purchase Price was
decreased at Closing as a result of this previously uncured Title Defect or (ii)
in the case of an Asset affected by an unresolved Title Defect and for which the
validity  of  the  Title  Defect  or  the  Title Defect Value is determined with
finality  whether  by  agreement  or  in  accordance  with  Section  4.13,  the
difference,  if  any,  between  the  amount  the Purchase Price was decreased at
Closing  as  a consequence of such  asserted and unresolved Title Defect and the
amount  determined  with  finality.

SECTION  4.05     Special  Warranty  of Title.  The documents to be executed and
delivered  by  Seller  to  Buyer,  transferring  title to the Assets as required
hereby,  including the Assignment and Bill of Sale the form of which (subject to
modification to meet state recording statute requirements) is attached hereto as
Exhibit D (the "Assignment"), shall provide for a special warranty of title, by,
through,  and  under Seller, subject to the Permitted Encumbrances and the terms
of  this  Agreement; provided, however, certain fee mineral interests located in
the State of Wyoming shall be conveyed by Mineral Quitclaim Deeds in the form of
Exhibit  E attached hereto.  The term "Permitted Encumbrances" shall mean any of
the following matters to the extent the same are valid and subsisting and affect
the  Assets:

(a)     any  (i)  undetermined  or  inchoate  liens  or  charges constituting or
securing  the  payment  of  expenses  that  were  incurred  incidental  to  the
maintenance,  development,  production,  or  operation  of the Assets or for the
purpose  of  developing,  producing,  or  processing  Hydrocarbons  therefrom or
therein,  and  (ii)  materialman's,  mechanics',  repairman's,  employees',
contractors',  or  operators'  liens  or  other  similar  liens  or  charges for
liquidated  amounts  arising  in the ordinary course of business (A) that Seller
has  agreed  to  retain  or  pay  pursuant to the terms hereof, or (B) for which
Seller  is  responsible  for  paying  or  releasing  at  the  Closing;

(b)     any  liens  for  Taxes  and  assessments  not  yet  delinquent  or,  if
delinquent,  that  are  being  contested in good faith in the ordinary course of
business  and  for  which

<PAGE>
Seller  has  agreed  to  pay  pursuant  to  the  terms hereof or which have been
prorated  pursuant  to  the  terms  hereof;

(c)     the  terms,  conditions,  restrictions,  exceptions,  reservations,
limitations,  and  other  matters  contained in (including any liens or security
interests  created by Law or reserved in Leases for royalty, bonus or rental, or
created  to  secure  compliance  with  the  terms  of)  the  Contracts,  Surface
Agreements,  Leases, and any other agreements, instruments, documents, and other
matters  described  or  referred  to in any Exhibit or Schedule hereto, or other
terms  in  such instruments that create or reserve to Seller its interest in the
Assets;  provided,  that,  such  matters  do  not  operate to (i) reduce the Net
Revenue  Interest  of Seller in any Well, PUD Location, PDNP, or Probable and/or
Possible Locations as reflected in Exhibit C, or (ii) increase the proportionate
share  of  costs  and  expenses of leasehold operations attributable to or to be
borne  by the Working Interest of Seller with respect to any Well, PUD Location,
PDNP,  or  Probable  and/or Possible Locations as reflected in Exhibit C, unless
there  is  a proportionate increase in Seller's applicable Net Revenue Interest;

(d)     any  obligations  or  duties  affecting  the  Assets to any Governmental
Authority  with  respect  to  any  franchise, grant, license, or permit, and all
applicable  federal,  state,  and  local  laws,  rules,  regulations, guidances,
ordinances,  decrees,  and  orders  of  any  Governmental  Authority  ("Laws");

(e)     any  (i)  easements, rights-of-way, servitudes, permits, surface leases,
and  other rights in respect of surface operations, pipelines, grazing, hunting,
lodging,  canals,  ditches,  reservoirs,  or  the  like,  and (ii) easements for
streets,  alleys,  highways,  pipelines, telephone lines, power lines, railways,
and  other  similar  rights-of-way  on, over, or in respect of property owned or
leased by Seller or over which Seller owns rights-of-way, easements, permits, or
licenses;

(f)     all  royalties,  overriding  royalties,  net  profits interests, carried
interests,  production payments, reversionary interests, and other burdens on or
deductions  from  the  proceeds  of production created or in existence as of the
Effective  Time,  whether recorded or unrecorded, that do not (i) reduce the Net
Revenue  Interest  of Seller in any Well, PUD Location, PDNP, or Probable and/or
Possible  Locations  and  as  reflected  in  Exhibit  C,  or  (ii)  increase the
proportionate  share  of costs and expenses of leasehold operations attributable
to  or  to  be borne by the Working Interest of Seller with respect to any Well,
PUD  Location,  PDNP,  or  Probable  and/or  Possible  Locations as reflected in
Exhibit  C,  unless there is a proportionate increase in Seller's applicable Net
Revenue  Interest;

(g)     preferential  rights  to purchase or similar agreements (i) with respect
to  which  (A) waivers or consents are obtained from the appropriate parties for
the transaction contemplated hereby, or (B) required notices have been given for
the  transaction  contemplated  hereby  to  the  holders  of such rights and the
appropriate  period for asserting such rights has expired without an exercise of
such  rights,  or  (ii) not exercised prior to Closing, subject to Section 4.06;

<PAGE>
(h)     required  third party consents to assignments or similar agreements with
respect to which (i) waivers or consents have been obtained from the appropriate
parties  for  the transaction contemplated hereby, or (ii) required notices have
been given for the transaction contemplated hereby to the holders of such rights
and  the  appropriate  period  for  asserting such rights has expired without an
exercise  of  such  rights;

(i)     all  rights  to  consent by, required notices to, filings with, or other
actions  by,  Governmental Authorities in connection with the sale, transfer, or
conveyance  of  the  Assets  that  are  customarily  obtained after such sale or
conveyance;

(j)     production  sales  contracts;  division  orders;  contracts  for  sale,
purchase,  exchange,  or  processing  of  Hydrocarbons;  unitization and pooling
designations,  declarations,  orders,  and  agreements;  operating  agreements;
agreements  of development; area of mutual interest agreements; gas balancing or
deferred  production  agreements;  processing  agreements;  plant  agreements;
pipeline, gathering, and transportation agreements; injection, repressuring, and
recycling agreements; water or other disposal agreements; seismic or geophysical
permits  or  agreements;  and any and all other agreements that are ordinary and
customary  to  the  oil,  gas,  and  other  mineral  exploration,  development,
processing,  or  extraction business or in the business of processing of gas and
gas  condensate  production  for the extraction of products therefrom; provided,
that,  such  matters do not (i) reduce the Net Revenue Interest of Seller in any
Well,  PUD Location, PDNP, or Probable and/or Possible Locations as reflected in
Exhibit  C  or  (ii)  increase  the proportionate share of costs and expenses of
leasehold  operations  attributable to or to be borne by the Working Interest of
Seller with respect to any Well, PUD Location, PDNP, or Probable and/or Possible
Locations as reflected in Exhibit C, unless there is a proportionate increase in
Seller's  applicable  Net  Revenue  Interest;

(k)     rights reserved to or vested in any Governmental Authority to control or
regulate  any  of  the  Wells or units included in the Assets and the applicable
laws,  rules,  and  regulations  of  such  Governmental  Authorities;

(l)     all  defects  and irregularities affecting the Assets which individually
or  in the aggregate do not (i) reduce the Net Revenue Interest of Seller in any
Well,  PUD Location, PDNP, or Probable and/or Possible Locations as reflected in
Exhibit  C,  (ii)  increase  the  proportionate  share  of costs and expenses of
leasehold  operations attributable to or to be borne by the Working Interests of
Seller with respect to any Well, PUD Location, PDNP, or Probable and/or Possible
Locations  as reflected on Exhibit C unless there is a proportionate increase in
Seller's  applicable  Net  Revenue  Interest,  or  (iii)  otherwise  result in a
material  and  adverse  interference  with  the  operation, value, or use of the
Assets;

(m)     conventional  rights  of reassignment arising upon decision to surrender
or  abandon  an  interest;  and

(n)     such  Title  Defects  as  Buyer  has  waived pursuant to Section 4.03 or
otherwise  waived  in writing by Buyer in accordance with any other provision in
this  Agreement  other  than  pursuant  to  Section  4.03.

<PAGE>
SECTION  4.06     Preferential  Rights  to  Purchase.

(a)     After  consultation with Buyer, Seller shall use its reasonable efforts,
but  without  any obligation to incur anything but reasonable costs and expenses
in  connection  therewith,  to  comply  with  all preferential right to purchase
provisions relative to any Asset prior to the Closing, including those rights of
preferential  purchase  identified  on  Schedule  4.06.

(b)     Prior  to the Closing, Seller shall promptly notify Buyer if any of such
preferential  purchase  rights  are  exercised  or  if  the requisite period has
elapsed  without  such  rights  having  been  exercised.

(c)     If  a third party who has been offered an interest in any Asset pursuant
to  a preferential right to purchase elects prior to the Closing to purchase all
or  part  of  such  Assets, and the closing of such transaction does occur on or
before  the  Closing Date, then the interest or part thereof so affected will be
eliminated  from  the  Assets  and  the  Purchase  Price shall be reduced by the
Allocated Value of such Assets.  If any such third party has elected to purchase
all  or  a  part  of an interest in any Asset subject to a preferential right to
purchase,  but has failed to close the transaction by the Closing Date, then all
of  the  Assets  will be conveyed to Buyer at Closing, without adjustment to the
Purchase  Price,  and on the Closing Date Buyer shall, as an Assumed Obligation,
assume  all duties, obligations, and liabilities, of any kind or nature, arising
from,  out  of,  or  in  connection  with, any enforceable preferential right to
purchase that is outstanding, and, if exercised, Buyer shall receive the payment
therefor  and  shall  assign the affected portion of the Assets to the holder of
such  exercised  preferential  right  to purchase.  In addition, in the event an
interest  is  offered by Seller pursuant to a preferential right to purchase for
which  notice  has  been given but the time period for response by the holder of
such  right  extends beyond Closing, such interest shall be conveyed to Buyer at
the  Closing,  without  reduction to the Purchase Price, and shall be subject to
such  preferential  right  of  purchase.

SECTION  4.07     Consents  to  Assignment.  If  any Asset is subject to a Title
Defect  as  a  result  of  a  consent  to  assignment  not having been obtained,
including  those  consents  to assignment set forth on Schedule 4.07, or, of the
existence  of  other  restrictions  on  assignment  or conveyance, the following
provisions  shall  apply:

(a)     Buyer  and  Seller  shall  cooperate  in  any  reasonable  and  lawful
arrangement  proposed  to  provide  Buyer  with the benefits of ownership of the
affected  Asset  without  breaching  the  consent  requirement  or  restriction
comprising  such  Title  Defect;  and

(b)     If  such  arrangement  involves  Seller  retaining  actual  title  with
beneficial  title  being  assigned  to  Buyer  at  the  Closing,  then:

     (i)  only  such beneficial title shall be assigned to Buyer at the Closing,
without  any  adjustment  to  the  Purchase  Price  for  such  Title Defect; and

<PAGE>
     (ii)  if  such consent is obtained or such restriction eliminated following
the  Closing,  then  Seller  shall execute and deliver to Buyer an assignment of
Seller's retained title and any related obligations consistent with the terms of
this  Agreement.

SECTION  4.08     [Intentionally  Omitted].

SECTION  4.09     Environmental  Review.  Buyer  may  conduct  an  environmental
assessment  of  the  Assets  prior  to  the  expiration of the Title Claim Date,
subject  to  the  following:

(a)     Buyer shall have the right to conduct a Phase I (as that term is defined
by  the  American Society for Testing and Materials) environmental review of the
Assets prior to the expiration of the Examination Period ("Buyer's Environmental
Review")  and  Seller  shall provide to Buyer a copy of any environmental review
Seller  has  in  its  possession  subject  to  the same terms of confidentiality
subsequently  set  forth  herein;

     (i)  The  cost  and  expense of Buyer's Environmental Review shall be borne
solely  by  Buyer;

     (ii)  All  inspections  must  be  coordinated  through  a  designated
representative  of  Seller  who may accompany Buyer during the course of Buyer's
inspection  of  the  Assets;

     (iii)  All  environmental  assessments shall be conducted by an independent
environmental  consultant  engaged  by  Buyer  at  Buyer's  expense;

     (iv)  Buyer  shall  give Seller notice not more than seven (7) days and not
less  than  forty-eight  (48)  hours  before  any  visits  by  Buyer  and/or its
consultant to the Assets, and Buyer shall seek and obtain Seller's prior consent
(which  shall  not  be unreasonably withheld) before either it or its consultant
enters  the  Assets;

     (v)  Buyer  shall provide Seller a copy of the Phase I report affecting the
Assets  promptly  after  Buyer's  receipt  and  review  of  the  same;

     (vi)  Buyer and/or its consultant shall perform all such work in a safe and
workmanlike  manner,  shall not unreasonably interfere with Seller's operations,
and  shall  comply  with  all  Laws  of  applicable  Governmental  Authorities;

     (vii)  Buyer  shall  be  solely  responsible  for obtaining any third party
consents  that  are  required  in  order  to perform any work comprising Buyer's
Environmental  Review,  and Seller shall cooperate with Buyer in connection with
Buyer's  efforts  to  obtain  each  such  third  party  consent;  and

<PAGE>
     (viii)  Buyer  hereby  agrees  to  release  and  defend, indemnify and hold
harmless Seller and Seller's Representatives from and against all Claims made by
(or  attributable  to the acts or omissions of) Buyer or Buyer's Representatives
(INCLUDING  THOSE  RESULTING FROM THE SOLE, JOINT, OR CONCURRENT NEGLIGENCE (BUT
NOT  GROSS  NEGLIGENCE  OR  WILLFUL MISCONDUCT), STRICT LIABILITY OR OTHER LEGAL
FAULT OF A SELLER OR ANY OF SELLER'S REPRESENTATIVES) arising out of or relating
to  Buyer's  Environmental  Review. The release and indemnity provisions of this
Section  4.09  shall  survive  termination  or  Closing  of  this  Agreement
notwithstanding  anything  to  the  contrary  provided  for  in  this Agreement.

(b)     Unless  otherwise  required  by  applicable  Laws, Buyer shall treat any
matters  revealed  by  Buyer's Environmental Review and any environmental review
provided  by  Seller  to  Buyer,  including any analyses, compilations, studies,
documents,  reports  or  data  prepared  or  generated  from  such  review  (the
"Environmental  Information"),  as  confidential, and, except as provided below,
Buyer  shall  not  disclose  any  Environmental  Information to any Governmental
Authority  or  other  third  party  without the prior written consent of Seller.
Buyer  may  use  the  Environmental  Information  only  in  connection  with the
transactions  contemplated  by  this  Agreement.  The  Environmental Information
shall  be  disclosed  by  Buyer  to  only  those  persons  who  need to know the
Environmental  Information  for  purposes  of  evaluating  the  transaction
contemplated  by  this Agreement, and who agree to be bound by the terms of this
Section  4.09.  If  Buyer  or  any  third  party  to whom Buyer has provided any
Environmental  Information  is requested, compelled, or required to disclose any
of  the Environmental Information, Buyer shall provide Seller with prompt notice
sufficiently  prior to any such disclosure so as to allow Seller to file for any
protective  order,  or  seek any other remedy, as it deems appropriate under the
circumstances.  If  this  Agreement  is  terminated  prior  to the Closing, upon
Seller's  request,  Buyer  shall  deliver the Environmental Information, and all
copies  thereof  and  works  based  thereon,  to  Seller,  which  Environmental
Information  shall become the sole property of Seller.  Upon request Buyer shall
provide  copies  of the Environmental Information to Seller without charge.  The
terms  and  provisions  of this Section 4.09(b) shall survive any termination of
this  Agreement,  notwithstanding  anything  to  the  contrary.

SECTION  4.10     Definitions  Used  in  Article  4  and  in  this  Agreement.

(a)     Environmental Defects.  The term "Environmental Defect" shall mean, with
respect  to  any  given Asset, a violation of Environmental Laws in effect as of
the  Effective  Time  in  the  jurisdiction  in  which  such  Asset  is located.

(b)     Governmental  Authority.  The  term  "Governmental Authority" shall mean
the  United  States and any state, county, city, and political subdivisions that
exercises  jurisdiction, and any agency, department, board, commission, or other
instrumentality  thereof.

<PAGE>
(c)     Environmental  Laws.  The  term  "Environmental Laws" shall mean any and
all  laws,  statutes,  ordinances,  rules,  regulations,  or  orders  of  any
Governmental Authority pertaining to health and natural resources (but excluding
laws,  orders, rules, and regulations that pertain to the prevention of waste or
the  protection  of  correlative  rights)  and the protection of wildlife or the
environment  including,  without  limitation, the Clean Air Act, as amended, the
Clean  Water  Act,  as  amended,  the  Comprehensive  Environmental,  Response,
Compensation,  and  Liability  Act  of  1980, as amended ("CERCLA"), the Federal
Water  Pollution Control Act, as amended, the Resource Conservation and Recovery
Act  of  1976, as amended ("RCRA"), the Safe Drinking Water Act, as amended, the
Toxic Substances Control Act, as amended, the Hazardous & Solid Waste Amendments
Act  of  1984,  as  amended, the Superfund Amendments and Reauthorization Act of
1986,  as  amended,  the Hazardous Materials Transportation Act, as amended, the
Oil  Pollution  Act  of  1990 ("OPA"), any state laws implementing the foregoing
federal  laws,  and  any  state  laws  pertaining to the handling of oil and gas
exploration and production wastes (including water) or the use, maintenance, and
closure  of  pits  and impoundments, and all other environmental conservation or
protection  laws  in  effect  as  of the date hereof which are applicable to the
Assets.  For  purposes  of  this  Agreement,  the  terms  "hazardous substance,"
"release,"  and  "disposal"  have  the  meanings  specified  in  the  applicable
Environmental  Laws  as  in  effect  as  of  the  date  hereof.

(d)     Environmental  Defect  Value.  For  purposes of this Agreement, the term
"Environmental  Defect  Value"  shall  mean,  with  respect to any Environmental
Defect,  the  estimated  costs  and  expenses  net  to  Seller's interest in the
affected  portion  of  the Assets to correct and/or remediate such Environmental
Defect  in  the most cost effective manner reasonably available, consistent with
Environmental Laws, taking into account that non-permanent remedies (such as, by
way  of  example  but  not by limitation or similarity, mechanisms to contain or
stabilize  hazardous  materials,  including  monitoring site conditions, natural
attenuation,  risk-based  corrective  action,  institutional  controls, or other
appropriate  restrictions  on  the  use of property, caps, dikes, encapsulation,
leachate  collection  systems,  etc.)  may  be  the  most  cost effective manner
reasonably  available.

SECTION  4.11     Notice  of  Environmental Defects.  Buyer shall provide Seller
notice  of  all  Environmental  Defects  no later than 5:00 p.m. CST on March 8,
2011.  To  be  effective, such notice must (a) be in writing, (b) be received by
Seller  prior  to  the  expiration  of  the Examination Period, (c) describe the
Environmental  Defect  in reasonable detail, including the written conclusion of
Buyer  that an Environmental Defect exists, which conclusion shall be reasonably
substantiated  by the factual data gathered in Buyer's Environmental Review, (d)
identify  the  specific  Assets  affected  by such Environmental Defect, (e) set
forth  the  procedures  recommended to correct the Environmental Defect, (f) set
forth  Buyer's reasonable good faith estimate of the Environmental Defect Value,
including  the  basis  for  such estimate, and (g) comply with the Environmental
Defect  Value  provisions  of  Section  4.14.  Any  matters  that  may otherwise
constitute  Environmental Defects, but of which Seller has not been specifically
notified  by  Buyer  in  accordance  with  the  foregoing,  together  with  any
environmental  matter that does not constitute an Environmental Defect, shall be
deemed  to  have been waived by Buyer for all purposes and constitute an Assumed
Obligation.  Upon receipt of notices of Environmental Defects, the Parties shall
meet and determine upon which of the Environmental Defects, Environmental Defect
Values,  and  methods  of  correction  the  Parties

<PAGE>
have  reached  agreement.  Upon the receipt of such effective notice from Buyer,
Seller shall have the option, but not the obligation, to attempt to correct such
Environmental  Defect during a period expiring 90 days after Closing.  If Seller
should  not  elect  to  correct  an  Environmental Defect, and no aspect of such
defect  is  in  dispute, the Purchase Price shall be adjusted for such defect by
the  amount  of  the  Environmental  Defect  Value.

SECTION  4.12     Remedies  for  Environmental  Defects.

(a)     If,  as  of  the  Closing Date, the Assets are affected by an uncured or
otherwise  unresolved Environmental Defect noticed pursuant to the provisions of
Section 4.11, the affected portion of the Assets shall not be sold, transferred,
or  conveyed  to  Buyer at Closing, and the Purchase Price shall, subject to the
terms of Section 4.14, be decreased by the Allocated Value of the portion of the
Assets  so  affected.  Thereafter,  Buyer and Seller shall act reasonably and in
good  faith  either  (i)  to  agree  (y)  as  to  the  manner  of  cure for such
Environmental  Defect  or  (z) the value of such Environmental Defect and adjust
the  Final  Settlement Statement in the amount thereof net of any Purchase Price
adjustment  made  at  Closing  (subject  to the terms of Section 4.14), in which
event  the  affected portion of the Assets shall be conveyed to Buyer; provided,
that  if  option  (y) is agreed to, no assignment of the affected portion of the
Assets  shall  be  made  as  between  Seller and Buyer until such agreed cure is
accomplished  to  Buyer's  reasonable satisfaction whereupon the Allocated Value
previously  deducted  from  the  Purchase Price shall be paid to Seller, or (ii)
with  respect  to any Environmental Defect as to which the Parties are unable to
agree  within 30 days of Closing as to the validity of the Environmental Defect,
the  Environmental Defect Value, or the manner of correction, submit such matter
to  be  determined  by  an  Independent  Expert  pursuant  to  Section  4.13.

(b)     With respect to any Asset which is not sold, transferred, or conveyed to
Buyer at the Closing pursuant to the terms of Section 4.12(a), after the Closing
and  at  such time as any Environmental Defect Value or the manner of correction
for  an  Environmental  Defect  is  determined  and, in either event, the amount
thereof  is  determined  to  be  less  than the Allocated Value for the affected
portion  of  the  Assets,  Seller  shall  have  the  right (i) in the case of an
Environmental  Defect  Value  determination,  to have the Purchase Price reduced
(subject  to  the terms of Section 4.14), by only the Environmental Defect Value
as so determined or (ii) in the case of the cure determination, to elect to cure
the Environmental Defect to Buyer's reasonable satisfaction.  The consequence of
(i)  shall  be  that  Buyer  will pay to Seller an amount equal to the Allocated
Value  for  the affected Assets minus the Environmental Defect Value (subject to
the  terms  of  Section  4.14) and the affected portion of the Assets previously
retained by Seller shall be conveyed to Buyer.  The consequence of (ii) shall be
that  upon  achieving  Buyer's  written  acknowledgement  that the Environmental
Defect  has  been  cured to its reasonable satisfaction, the Allocated Value for
such  previously retained Asset shall be paid to Seller and the affected portion
of  the  Assets  shall  be  conveyed  to  Buyer.  If  no Environmental Defect is
determined  to  exist,  Buyer  shall pay the Allocated Value attributable to the
affected portion of the Assets to Seller, and Seller shall convey the previously
retained  portion  of  the  Assets  to  Buyer.  If  the  Environmental

<PAGE>
Defect  Value  or  the  cost to cure an Environmental Defect is determined to be
greater  than  the Allocated Value of the affected portion of the Assets, Seller
may  retain  the affected portion of the Assets, and the Purchase Price shall be
reduced  by  the  Allocated  Value  attributable  to such portion of the Assets.

SECTION  4.13     Independent  Experts.

(a)     Without  waiving  any  rights  to  terminate this Agreement as set forth
herein,  any  disputes  regarding  Title  Defects,  Environmental Defects, Title
Defect  Value, Environmental Defect Value, appropriate cure of any Title Defects
or correction of any Environmental Defects, and the calculation of the Statement
or  the  Final  Settlement  Statement, or revisions thereto, may, subject to the
provisions  of  Section  4.04, Section 4.12, and Section 4.14, be submitted by a
Party,  with  written  notice  to the other Party, to an independent expert (the
"Independent  Expert"),  who shall serve as the sole and exclusive arbitrator of
any  such  dispute.  The  Independent  Expert  shall  be selected by the Parties
(acting  reasonably  and  in  good  faith)  within  five  (5) days following the
effective  date of said notice.  The Independent Expert shall be a person who is
independent,  impartial, and knowledgeable in the subject matter and substantive
laws  involved.  For  example,  but  not  by way of limitation, in the case of a
dispute  concerning an alleged Environmental Defect, Environmental Defect Value,
or  cure  of  the  same, the Independent Expert shall have expertise in both the
applicable  Environmental Laws and environmental science relating to the oil and
gas  industry.

(b)     The  Parties shall determine, acting in good faith, the procedures to be
followed  to facilitate the decision of the Independent Expert.  Such procedures
shall  include  the  following  scenario:

     (i) If the dispute involves the method or adequacy of cure or correction of
a  Title Defect or Environmental Defect, the Independent Expert shall provide in
writing  the particulars necessary to cure or correct or to remedy any deficient
cure or correction, and shall provide Seller 60 days (or such additional time as
reasonable  and  necessary  under  the  circumstances, but not to exceed 90 days
unless  specifically  agreed  to  in writing by Seller and Buyer) to effect such
cure  or  correction;  and

     (ii) In the event of circumstances described in clause (i) above, Seller at
their  option  may  at any time during the 60-day cure period pursuant to clause
(i)  (as such period may be extended pursuant to such clause) decline to cure or
correct  the  applicable  defect.

(c)     If  the Parties fail to select an Independent Expert within the five-day
period  referred  to in Section 4.13(a) above, within three (3) days thereafter,
each  of  Buyer  and  Seller  shall  choose  an  Independent  Expert meeting the
qualifications  set  forth above, and such experts shall promptly choose a third
Independent  Expert  (meeting  the qualifications provided for herein) who alone
shall  resolve  the  disputes  between  the

<PAGE>
Parties.  Each  Party  shall  bear  its  own  costs  and  expenses  incurred  in
connection  with  any  such  proceeding,  and  one-half  (1/2)  of the costs and
expenses  of  the  Independent  Expert.

(d)     Disputes  to  be  resolved by an Independent Expert shall be resolved in
accordance with mutually agreed procedures and rules and failing such agreement,
in accordance with the rules and procedures for non-administered arbitration set
forth  in  the  commercial  arbitration  rules  of  the  American  Arbitration
Association.  The  Independent  Expert  shall  be  instructed  by the Parties to
resolve  such  dispute  as  soon  as  reasonably  practicable  in  light  of the
circumstances  using  the terms and provisions of this Agreement with respect to
title  and  environmental  matters.  The  decision  and award of the Independent
Expert  shall  be  binding  upon the Parties and final and non-appealable to the
maximum  extent  permitted  by  Laws  or  Environmental Laws, as applicable, and
judgment  thereon  may  be  entered  in  a  court  of competent jurisdiction and
enforced  by  any  Party  as  a  final  judgment  of  such  court.

(e)     All proceedings under this Section 4.13 shall be conducted at a mutually
agreed  location, or if Buyer and Seller acting reasonably do not mutually agree
upon  a  location  for  such  proceeding,  the  proceeding shall be conducted in
Houston,  Texas.

SECTION  4.14     Limitation  of  Remedies  For  Title Defects and Environmental
Defects.  Notwithstanding  anything to the contrary contained in this Agreement,

(a)     if  the  Title  Defect  Value  for  a  given Title Defect, as determined
pursuant  to  this  Article  4  does  not  exceed Ten Thousand Dollars ($10,000)
figure,  or  if the Environmental Defect Value for a given Environmental Defect,
as  determined  pursuant  to this Article 4 does not exceed Ten Thousand Dollars
($10,000),  such  Title  Defect,  or  Environmental Defect shall not qualify for
either  a  Purchase  Price adjustment, cure, or correction of such Defect. It is
understood  and  agreed that certain Title Defects may affect various aspects of
an individual Lease such as the Wells and the undeveloped locations described in
Exhibit  C that are located in such Lease. In any such case, and notwithstanding
the  foregoing  pertaining  to  individual  Title Defect Values, for purposes of
determining  whether the aforementioned Ten Thousand Dollar ($10,000) figure has
been  achieved,  all Title Defect Values affecting any individual Lease shall be
aggregated  on  a  Lease  by Lease basis, provided, however, if it is determined
that  a single instrument gives rise to a common Title Defect affecting Wells or
undeveloped  locations  on more than one Lease, the Title Defect Values relating
thereto  shall  also be aggregated in determining whether the aforementioned Ten
Thousand  Dollar  ($10,000)  figure  has been achieved.  Similarly, and to avoid
doubt,  if  there  is  a  series  of  minor, discrete Environmental Defects, all
deriving  from  a  common  operative  problem  (as  opposed to a generic type of
issue),  such  discrete  Environmental  Defects may be aggregated in determining
whether  the  aforementioned  Ten  Thousand  Dollars  ($10,000)  figure has been
achieved  for  Environmental  Defects.

(b)     if the aggregate value of all Title Defects does not exceed Five Hundred
Thousand  Dollars  ($500,000), then no adjustment of the Purchase Price shall be
made  therefor;

<PAGE>
(c)     if  the  aggregate  value  of  all  Title Defects equals or exceeds Five
Hundred  Thousand  Dollars ($500,000), then the Purchase Price shall be adjusted
by  only  the  amount of such aggregate value of such Title Defects in excess of
Five  Hundred  Thousand  Dollars  ($500,000), it being understood that this Five
Hundred  Thousand  Dollar ($500,000) figure is a deductible and not a threshold;

(d)     if the aggregate value of all Environmental Defects does not exceed Five
Hundred  Thousand  Dollars  ($500,000), then no adjustment of the Purchase Price
shall  be  made  therefor;  and

(e)     if  the  aggregate  value of all Environmental Defects equals or exceeds
Five  Hundred  Thousand  Dollars  ($500,000),  then  the Purchase Price shall be
adjusted by only the amount of such aggregate value of the Environmental Defects
in  excess of Five Hundred Thousand Dollars ($500,000), it being understood that
this  Five  Hundred  Thousand Dollar ($500,000) figure is a deductible and not a
threshold.

All  Title  Defects and Environmental Defects asserted by Buyer pursuant to this
Article  4  after  being  resolved  in  accordance  with  this  Article  4 shall
thereafter constitute Permitted Encumbrances and Assumed Obligations, whether or
not  an  adjustment  to  the  Purchase  Price  is  made  with respect thereto in
accordance  with  this  Article  4.

SECTION  4.15     DISCLAIMER AND WAIVER.  EXCEPT AS SET FORTH IN THIS AGREEMENT,
SELLER  DOES  NOT  MAKE  ANY,  AND  EXPRESSLY  DISCLAIMS  ALL REPRESENTATIONS OR
WARRANTIES, AND BUYER EXPRESSLY WAIVES ANY SUCH REPRESENTATION OR WARRANTIES, AS
TO THE ACCURACY OR COMPLETENESS OF ANY FILE AND/OR OTHER INFORMATION, INCLUDING,
PRINTOUTS,  EXTRAPOLATIONS, PROJECTIONS, DOCUMENTATION, MAPS, GRAPHS, CHARTS, OR
TABLES  WHICH  REFLECT,  DEPICT,  PRESENT,  PORTRAY,  OR WHICH ARE BASED UPON OR
DERIVED FROM ANY SUCH INFORMATION AND/OR FILES, INCLUDING MATTERS OF GEOLOGICAL,
GEOPHYSICAL,  ENGINEERING,  OR OTHER SCIENTIFIC INFORMATION THAT MAY BE PROVIDED
TO  BUYER  BY  SELLER  OR BY OTHERS ON BEHALF OF SELLER.  BUYER EXPRESSLY AGREES
THAT ANY CONCLUSIONS DRAWN FROM REVIEW OF SUCH INFORMATION AND/OR FILES SHALL BE
THE  RESULT  OF  ITS  OWN  INDEPENDENT  REVIEW  AND  JUDGMENT.

                                   ARTICLE  5

                    REPRESENTATIONS AND WARRANTIES OF SELLER

Seller  represents  and  warrants  to  Buyer  that:

SECTION  5.01     Existence.  Seller  is  a  corporation duly organized, validly
existing, and in good standing under the laws of the State of New Jersey. Seller
has  full  legal  power,  right,  and  is authorized to do business, and in good
standing,  in  the  States  in  which  the  Assets  it  owns  are  located.

<PAGE>
SECTION  5.02     Legal  Power.  Seller  has  the legal power and right to enter
into  and  perform this Agreement and the transactions contemplated hereby.  The
consummation  of  the  transactions  contemplated  by  this  Agreement  will not
violate,  or  be  in  conflict  with:

(a)     any  provision  of Seller's articles of incorporation, bylaws, and other
governing  documents;

(b)     except  for  provisions  customarily contained in oil and gas agreements
relating  to  maintenance  of uniform interest, preferential purchase rights and
consents  to assignment, any material agreement or instrument to which Seller is
a  party  or  by  which  Seller  or  the  Assets  are  bound;  or

(c)     any  judgment,  order, ruling, or decree applicable to Seller as a party
in  interest  or  any  law,  rule,  or  regulation  applicable  to  Seller.

SECTION  5.03     Execution.  The  execution,  delivery, and performance of this
Agreement  and  the  transactions  contemplated  hereby  are  duly  and  validly
authorized  by  all requisite corporate action on the part of Seller as required
under its formation documents.  This Agreement constitutes the legal, valid, and
binding obligation of Seller enforceable in accordance with its terms, except as
the  same may be limited by bankruptcy, insolvency, or other laws relating to or
affecting  the  rights  of  creditors  generally,  and  by  general  equitable
principles.

SECTION  5.04     Brokers.  No  broker or finder is entitled to any brokerage or
finder's  fee,  or  to  any  commission,  based  in  any  way  on  agreements,
arrangements,  or understandings made by or on behalf of Seller or any affiliate
of  Seller  for  which  Buyer  has  or  will have any liabilities or obligations
(contingent  or  otherwise).

SECTION  5.05     Bankruptcy.  There  are  no  bankruptcy,  reorganization,  or
arrangement  proceedings pending, being contemplated by, or to the knowledge of,
Seller  threatened  against  Seller.  Seller  is not "insolvent" as such term is
defined  under  the  Federal  Bankruptcy  Code  or  any  fraudulent  transfer or
fraudulent  conveyance  statute  applicable  to the transactions contemplated by
this  Agreement.

SECTION  5.06     Suits and Claims.  Except as set forth in Schedule 5.06, there
is  no  litigation  or Claims that have been filed by any person or entity or by
any  administrative  agency  or  Governmental  Authority  in  any  legal,
administrative,  or arbitration proceeding or, to Seller's knowledge, threatened
against  Seller  or  the Assets that would impede Seller's ability to consummate
the transactions contemplated herein or would have a Material and Adverse Effect
on  the  Assets.

<PAGE>
SECTION  5.07     Taxes.  To  Seller's  knowledge,  (i)  during  the  period  of
Seller's  ownership of the Assets up to and including the Effective Time, Seller
has  caused  to be timely filed all material Tax returns relating to the Assets,
and  (ii)  Seller  has  paid  or  caused  to  be  paid all ad valorem, property,
production,  severance,  mineral  documentary,  and  similar Taxes based upon or
measured  by its ownership of or the production of Hydrocarbons from the Assets.
Except  as  set forth on Schedule 5.07, there are no pending audits of Seller by
any  applicable  taxing  authority  with  respect  to  Taxes attributable to the
Assets.  Except  for  statutory  liens  for property Taxes and ad valorem Taxes,
that  are  not yet due, there are no tax liens on or with respect to the Assets.

SECTION  5.08     AFEs.  Except  as  set  forth  on  Schedule 5.08, there are no
outstanding  authorizations  for expenditures or other capital commitments which
are  binding on the Assets and which individually would require the owner of the
Assets  after  the  Effective  Time to expend monies in excess of Fifty Thousand
Dollars  ($50,000).

SECTION  5.09     Compliance  with  Laws.  To  Seller's  knowledge and except as
reflected  on Schedule 5.06,  Seller's operation (i.e., where Seller is operator
of  record)  of  the Assets has been in compliance with Laws where noncompliance
with  such  Laws  would  have  a  Material  Adverse  Effect  on  the  Assets.

SECTION  5.10     Contracts.  To  Seller's  knowledge and except as reflected on
Schedule  5.06,  (i)  Seller  is not in Breach of any of the Contracts, (ii) the
Contracts are in full force and effect in accordance with their terms, and (iii)
no  other  party  to  any  of  the  Contracts  is  in  material  Breach thereof.

SECTION  5.11     Production  Imbalances.  To  Seller's  knowledge, there are no
material production imbalances as of the Effective Time as to any of the Subject
Interests.

SECTION  5.12     Payments for Production.  Seller is not obligated by virtue of
a  take  or  pay  payment,  call,  advance payment, production payment, or other
similar  payment  or  obligation (other than royalties, overriding royalties, or
similar  arrangements  that  do  not cause Seller's NRI to be less than that set
forth on Exhibit C), to deliver Hydrocarbons, or proceeds from the sale thereof,
attributable  to  the  Leases  at  some  future  time  without receiving payment
therefor  at or after the time of delivery at the then market price, and no take
or  pay  credits  must be provided before natural gas can be transported through
any interstate carrier under FERC Order 500, et al, and there are no obligations
on  the  Assets  under  FERC  Order  451.

<PAGE>
SECTION  5.13     Bonds.  Seller  maintains,  and  through  the  Closing  will
maintain,  with  respect  to  the  Assets, the bonds described on Schedule 5.13.

SECTION  5.14     Personal  Property  and Equipment.  Seller is the owner of the
Equipment  free  and  clear  of  all  liens  and  encumbrances.  Other  than  in
connection  with normal and customary prudent operations, Seller has not removed
any personal property, Equipment, or fixtures from the Wells, unless it has been
replaced  with  personal  property,  Equipment, or fixtures of similar grade and
utility  or placed in Seller's storage yard or used by it on other Seller Wells.

SECTION  5.15     Tax  Partnerships.  To  Seller's knowledge, none of the Assets
are  subject  to  partnership within the meaning of Subchapter K of Chapter 1 of
Subtitle  A  of  the  Internal  Revenue  Code.

SECTION  5.16     Hydrocarbon Sales Contracts.  Except for the Hydrocarbon sales
contracts  listed  in  Schedule  5.16,  no  Hydrocarbons  are subject to a sales
contract  (other  than division orders or spot sales agreements terminable on no
more  than 30 days' notice) and no person has any call upon, option to purchase,
or similar rights with respect to the production from the Assets.  Proceeds from
the  sale  of oil, condensate, and gas from the Assets are being received in all
respects by Seller in a timely manner and are not being held in suspense for any
reason.

SECTION  5.17     Area  of  Mutual  Interest and Other Agreements.   To Seller's
knowledge,  no  Asset  is  subject  to (or has related to it) any area of mutual
interest  agreements  not  disclosed in the Contracts or any farm-out or farm-in
agreement  under  which any party thereto is entitled to receive assignments not
yet  made,  or  could earn additional assignments after the Effective Time other
than  the  Wells  listed  on  Exhibit  B  as  having  an  after  payout  NRI.

SECTION  5.18     Leases.  To  Seller's  knowledge  and  except  as reflected on
Schedule 5.06, Seller has not received a written notice of termination of any of
the  Leases,  and  Seller  is  not  in Breach or violation of any of the Leases;
provided,  however,  that  Buyer's  remedy  for  Seller's  Breach  of  this
representation  and  warranty  shall  be the Title Defect mechanism set forth in
Article  4.

SECTION  5.19     Governmental Permits.  To Seller's knowledge, Sellers have all
Permits  (including,  without  limitation,  permits,  licenses,  approval
registrations,  notifications, exemptions, and any other authorizations pursuant
to  Law)  necessary  or  appropriate  to own and operate the Assets as presently
being  owned  and  operated.  The  Permits  are in full force and effect and the
Assets  have  been operated in accordance with the terms thereof in all material
respects.  Seller  has  not received written notice of any violations in respect
of  any  of  the  Permits  that  remain  uncured.

<PAGE>
SECTION 5.20     No Adverse Change.  With respect to the Assets for which Seller
is  the operator and, to Seller's knowledge with respect to the Assets for which
Seller  is  not  the operator, since the time of the information provided in the
Scotia  Waterous data room, the Assets have been operated in the ordinary course
of business consistent with past practices and there has been no event or series
of events that have either individually or in combination had a Material Adverse
Effect  on  the  Assets.

SECTION  5.21     Unrecorded  Interests.  To  Seller's  knowledge,  there are no
unrecorded  interests  in  the  Assets  created  by,  through  or  under Seller.

SECTION  5.22     Preferential  Rights  and  Consents.  To  Seller's  knowledge,
Schedule 4.06 accurately lists all preferential rights to purchase affecting the
Assets, and Schedule 4.07 accurately reflects all Assets subject to a consent to
assignment  other  than  those  customarily  obtained  after  Closing.

SECTION  5.23     Disclosure  of  Environmental  Information.  Without modifying
Buyer's  representation  and  warranty  contained  in  Section 6.07, to Seller's
knowledge,  Seller  has  not  intentionally  withheld  from  Buyer  any material
Environmental Information that, if disclosed, would trigger an adjustment to the
Purchase  Price  under  this  Agreement  due  to  an  Environmental  Defect.

SECTION  5.24     Notice  of  Change.  Promptly  upon  its  discovery  or
identification  of same, but in any event prior to Closing, Seller shall provide
Buyer  written  notice  of  any matter Seller identifies that has a material and
adverse  effect  on or that constitutes a Breach of Seller's representations and
warranties  under  this  Agreement.

SECTION  5.25     Representations and Warranties Exclusive.  All representations
and  warranties  contained  in this Article 5 and expressly made in any document
delivered at Closing by Seller pursuant to this Agreement are exclusive, and are
given  in lieu of all other representations and warranties, express, implied, or
statutory.

                                   ARTICLE  6

                    REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to Seller that:

SECTION  6.01     Existence  .  Buyer  is  a  Nevada  corporation  duly  formed,
organized, validly existing, and in good standing under the laws of the state of
its formation.  Buyer has full legal power, right, and authority to carry on its
business  as such is now being conducted.  As of the Closing Date, Buyer will be
authorized  to  do business as a foreign corporation and in good standing in the
States  in  which  the  Assets  are  located.

<PAGE>
SECTION 6.02     Legal Power.  Buyer has the legal power and right to enter into
and  perform  this  Agreement  and  the  transactions  contemplated hereby.  The
consummation  of  the  transactions  contemplated by this Agreement does not and
will  not  violate,  or  be  in  conflict  with:

(a)     any  provision  of  Buyer's  formation  documents  or  other  governing
documents;

(b)     any  material  agreement  or  instrument to which Buyer is a party or by
which  Buyer  or  its  assets  are  bound;  or

(c)     any judgment, order, ruling, or decree applicable to Buyer as a party in
interest  or  any  law,  rule,  or  regulation  applicable  to  Buyer.

SECTION  6.03     Execution.  The  execution,  delivery, and performance of this
Agreement  and  the  transactions  contemplated  hereby  are  duly  and  validly
authorized  by  all  requisite organizational action on the part of Buyer.  This
Agreement  constitutes  the  legal,  valid,  and  binding  obligation  of  Buyer
enforceable  in  accordance with its terms, except as the same may be limited by
bankruptcy,  insolvency  or  other  laws  relating to or affecting the rights of
creditors  generally,  and  by  general  equitable  principles.

SECTION  6.04     Brokers.  No  broker or finder is entitled to any brokerage or
finder's  fee,  or  to  any  commission,  based  in  any  way  on  agreements,
arrangements,  or  understandings made by or on behalf of Buyer or any affiliate
of  Buyer  for  which  Seller  has  or  will have any liabilities or obligations
(contingent  or  otherwise).

SECTION  6.05     Bankruptcy.  There  are  no  bankruptcy,  reorganization,  or
arrangement  proceedings  pending,  being contemplated by or to the knowledge of
Buyer  threatened  against  Buyer  or  any  affiliate  of  Buyer.

SECTION  6.06     Suits  and Claims.  There is no litigation or Claims that have
been  filed  by  any  person  or  entity  or  by  any  administrative  agency or
Governmental  Authority  in any legal, administrative, or arbitration proceeding
or,  to  Buyer's  knowledge,  threatened against Buyer or any affiliate of Buyer
that  is  reasonably  likely  to  have  a  material effect on Buyer's ability to
consummate  the  transactions  contemplated  herein.

<PAGE>
SECTION  6.07     Independent  Evaluation.  Buyer  acknowledges  that  it  is an
experienced  and  knowledgeable  investor  in  the oil and gas business, and the
business of purchasing, owning, developing, and operating oil and gas properties
such  as  the  Assets.  If  Closing  occurs,  Buyer  represents,  warrants,  and
acknowledges  to  Seller that it has had full access to the Assets, the officers
and employees of Seller, and to the books, records, and files of Seller relating
to  the  Assets.  In  making  the  decision  to enter into this Agreement and to
consummate  the  transactions  contemplated hereby, Buyer has relied solely upon
the  representations,  warranties, covenants, and agreements of Buyer and Seller
set  forth  in  this  Agreement  and  Buyer's  own independent due diligence and
investigation  of  the  Assets, and has been advised by and has relied solely on
its  own  expertise and its own legal, tax, operations, environmental, reservoir
engineering,  and  other  professional  counsel  and  advisors  concerning  this
transaction,  the Assets and the value thereof.  In addition, Buyer acknowledges
and  agrees  that  Buyer will be or has been advised by and relies solely on its
own  expertise,  and  its  legal  counsel and any advisors or experts concerning
matters  relating  to  Title  Defects,  and  Environmental  Defects.

SECTION  6.08     Qualification.  As  of  the  Closing,  the Buyer shall be, and
thereafter  shall  continue  to  be,  qualified with all applicable Governmental
Authorities  to  own  and  operate  the  Assets,  including  meeting all bonding
requirements.  In  the  event  any Governmental Authority, as a condition of its
approval  or consent to the assignment or transfer of any Lease, Well or Permit,
requires  additional  amounts  for  bonds, Buyer has the ability to provide such
increased  bond  amounts.

SECTION  6.09     Securities  Laws.  Buyer  is  acquiring the Assets for its own
account or that of its affiliates and not with a view to, or for offer of resale
in connection with, a distribution thereof, within the meaning of the Securities
Act  of  1933, 15 U.S.C. Sec. 77a et seq., and any other rules, regulations, and
laws  pertaining  to  the  distribution  of securities.  Buyer has not sought or
solicited,  nor is Buyer participating with, investors, partners, or other third
parties  other than its lenders in order to fund the Purchase Price and to close
this  transaction,  and  all  funds  to be used by Buyer in connection with this
transaction  are  Buyer's  own  funds  or  those  borrowed  from  its  lenders.

SECTION  6.10     No Investment Company.  Buyer is not (a) an investment company
or  a  company  controlled  by  an  investment company within the meaning of the
Investment Company Act of 1940, as amended, or (b) subject in any respect to the
provisions  of  that  Act.

SECTION  6.11     Funds.  Buyer  has  cash  on  hand  or  third-party  financing
contractually in place that is not subject to any contingency whatsoever so that
at  Closing Buyer shall have immediately available funds that shall enable Buyer
to  pay  the full Purchase Price as herein provided and otherwise to perform its
obligations  under  this  Agreement.

<PAGE>
SECTION  6.12     Notice  of  Changes.  Promptly  upon  its  discovery  or
identification  of  same, but in any event prior to Closing, Buyer shall provide
to  Seller  written  notice  of  any matter it so identifies that has a material
effect on any of Seller's representations or warranties under this Agreement, or
rendering  any  such  warranty  or  representation  untrue  or  inaccurate.

SECTION  6.13     Representations and Warranties Exclusive.  All representations
and  warranties  contained  in  this  Agreement  and  the documents delivered in
connection  herewith,  are  exclusive,  and  are  given  in  lieu  of  all other
representations  and  warranties,  express,  implied,  or  statutory.

                                   ARTICLE  7

                            OPERATION OF THE ASSETS

SECTION  7.01     Operation  of  the  Assets.

(a)     From  and  after the date of execution of this Agreement, and subject to
the  provisions  of  applicable operating and other agreements, Seller shall (i)
use  reasonable  efforts  during the period prior to the Closing, to operate and
administer  the Assets in a manner consistent with its past practices, (ii) make
payment  of all costs and expenses attributable to the ownership or operation of
the  Assets  and  relating  to the period prior to the transfer of operations to
Buyer,  and  shall  carry  on  its  business  with  respect  to  the  Assets  in
substantially  the  same  manner  as  before  execution of this Agreement, (iii)
except  in  the  case  of  an  emergency and as reflected on Schedule 5.08, not,
without Buyer's express written consent (which consent shall not be unreasonably
withheld or delayed), commit to participate in the drilling of any well, or make
or  enter  into  any  other commitments reasonably anticipated to require future
capital  expenditures  by  Buyer in excess of $50,000 net to a Seller's interest
for each proposed operation, (iv) not enter into, amend in any material respect,
or  terminate  any  material  Contract  except  in a manner consistent with past
practices;  provided,  as  to  those Contracts described on Schedule 7.01(a)(iv)
which  are due to expire or expected to be amended prior to the Closing Date, it
is  agreed  Seller  may  enter  into  a  replacement,  amendment,  extension  or
restatement  thereof  in  a  manner  consistent with Seller's past practices and
taking  into  account  prevailing  market  conditions when any such replacement,
amendment, extension or restatement is executed, (v) maintain insurance coverage
on  the Assets in the amounts and of the types presently in force, (vi) maintain
in  full  force and effect the Leases, the Surface Agreements, and other Assets,
and pay all costs and expenses and perform all material obligations of the owner
of  the  Assets  promptly  when  due,  (vii)  maintain  all  Permits, (viii) not
transfer,  sell,  remove,  hypothecate,  encumber,  or  otherwise dispose of any
Assets  except  for  sales and dispositions of Hydrocarbons made in the ordinary
course  of business consistent with a Seller's past practices, (xi) not grant or
create  any preferential right to purchase, right of first opportunity, or other
transfer  restriction  or

<PAGE>
requirement  with respect to the Assets except in connection with the renewal or
extension  of Assets after the Effective Time if granting or creating such right
or  requirement is a condition of such renewal or extension and then with prompt
written notice of such action to Buyer, (x) not elect to become a non-consenting
party  in  any operation proposed by any other Person with respect to the Assets
unless requested to do so in writing by Buyer, (xi) maintain the Equipment in at
least  as  good  a condition as it is on the date hereof, ordinary wear and tear
excepted,  (xii)  not  make any change in any method of accounting or accounting
practice  or  policy  with respect to the Assets, and (xiii) not agree to extend
any  statute  of limitations with respect to Taxes or any extension of time with
respect  to  a Tax assessment or deficiency for any Taxes, or make any change in
any  Tax  elections  with  respect  to  the  Assets.

(b)     Buyer  acknowledges  that  Seller  owns  undivided interests or contract
rights in some or all of the Assets, and Buyer agrees that the acts or omissions
of the other working interests owners, or parties thereto shall not constitute a
violation  of the provisions of this Article 7, nor shall any action required by
a vote of working interest owners or parties thereto constitute such a violation
so  long  as  Seller  has voted its interests in a manner that complies with the
provisions  of  this Article 7.  Seller will, without penalty for the failure to
do  so  except  to  the  extent that the failure to give Buyer such notice has a
Material  Adverse  Effect,  notify  Buyer of the occurrence of such event to the
extent  of  Seller's  knowledge.

SECTION  7.02     Buyer's  Qualification.  At  Closing, Buyer shall be qualified
and  shall  meet  all  requirements,  including  bonding  requirements,  to  be
designated  operator  of  that  portion of the Assets for which Seller serves as
operator.  In  the  event  any  Governmental  Authority,  as  a condition of its
approval  or consent to the assignment or transfer of any Lease, Well or Permit,
requires additional amounts for bond, Buyer shall promptly furnish such amounts.

SECTION  7.03     Operation  of  the  Assets after the Closing.  If requested by
Buyer  prior  to  Closing  and  without  limiting  the  scope of Buyer's Assumed
Obligations  (as  such  term  is defined under Section 12.01) and any of Buyer's
indemnification obligations under this Agreement, following Closing Seller shall
continue  to  operate  the  Assets  (for  which it was the operator prior to the
Closing  Date)  pursuant  to  the  framework  substantially  in  the  form of or
described  in  Exhibit  F, subject to availability of Seller's employees and the
Parties reaching agreement on proper reimbursement to be paid by Buyer to Seller
and  other  material  terms of engagement of Seller's services by Buyer.  Seller
shall make its employees and contractors available to Buyer prior to the Closing
as  may be reasonably necessary to assist in the transition if Buyer becomes the
operator.  Seller  does  not  warrant  or  guarantee  that Buyer will become the
operator of the Assets or any portion thereof, as such matter will be controlled
by  the  applicable  joint  operating  agreement(s)  and  other  applicable
agreement(s).

SECTION  7.04     Public  Announcements.  Prior  to  the Closing, no Party shall
make  any  press release or other public announcement regarding the existence of
this  Agreement  without  the  prior  written  consent  of  the  other  Party,

<PAGE>
the  contents hereof or the transactions contemplated herein; provided, however,
the  foregoing  shall  not  restrict  disclosures by Buyer which are required by
applicable  securities  or  other  Laws  or  the  applicable  rules of any stock
exchange  having  jurisdiction over Buyer or its Affiliates.  Following Closing,
the Parties may issue a press release, in which case such press release shall be
in  a  form and substance to be agreed upon by the Parties prior to the Closing.

                                   ARTICLE  8

                      CONDITIONS TO OBLIGATIONS OF SELLER

The obligations of Seller to consummate the transactions provided for herein are
subject,  at the option of Seller, to the fulfillment on or prior to the Closing
Date  of  each  of  the  following  conditions:

SECTION  8.01     Representations.  The  representations and warranties of Buyer
herein  contained  shall  be  true  and  correct in all material respects on the
Closing  Date  as  though  made  on  and  as  of  such  date;

SECTION  8.02     Performance.  Buyer  shall  have  performed  all  material
obligations,  covenants  and  agreements  contained  in  this  Agreement  to  be
performed or complied with by it at or prior to the Closing and shall have taken
the  actions  set  forth  in  Section  10.08;  and

SECTION 8.03     Pending Matters.  No suit, action, or other proceeding shall be
pending  or  threatened  that seeks to, or could reasonably result in a judicial
order,  judgment,  or decree that would, restrain, enjoin, or otherwise prohibit
the  consummation  of  the  transactions  contemplated  by  this  Agreement.

                                   ARTICLE  9

                       CONDITIONS TO OBLIGATIONS OF BUYER

The  obligations  of Buyer to consummate the transaction provided for herein are
subject,  at  the option of Buyer, to the fulfillment on or prior to the Closing
Date  of  each  of  the  following  conditions:

SECTION  9.01     Representations.  (a)  The  representations  and warranties of
Seller  contained in Section 5.01 through Section 5.06, inclusive, shall be true
and  correct  in all material respects on the Closing Date as though made on and
as  of such date, and (b) the representations and warranties of Seller contained
in  Section  5.07 through Section 5.24 shall be true and correct in all material
respects  through  the  expiration  of  the  Title  Claim  Date and no action or
omission  of  Seller  or  event  shall  have  occurred during the period of time
commencing  upon  the  expiration  of  the  Title  Claim  Date and ending on the
Closing  Date  which shall have caused any of the representations and warranties
of

<PAGE>
Seller contained in Section 5.07 through Section 5.24, inclusive, not to be true
and correct in all material respects on the Closing Date as though made on and
as of such date;

SECTION  9.02     Performance.  Seller  shall  have  performed  all  material
obligations,  covenants,  and  agreements  contained  in  this  Agreement  to be
performed or complied with by it at or prior to the Closing and shall have taken
the  actions  set  forth  in  Section  10.07;  and

SECTION 9.03     Pending Matters.  No suit, action, or other proceeding shall be
pending  or  threatened  that seeks to, or could reasonably result in a judicial
order,  judgment, or decree that would,  restrain, enjoin, or otherwise prohibit
the  consummation  of  the  transactions  contemplated  by  this  Agreement.

                                  ARTICLE  10

                                  THE CLOSING

SECTION  10.01     Time and Place of the Closing.  If the conditions referred to
in  Article  8  and  Article  9  have  been  satisfied or waived in writing, the
transactions  contemplated by this Agreement (the "Closing") shall take place at
the  Houston,  Texas  offices  of Seller at 9:00 a.m. CST on March 15, 2011 (the
"Closing  Date").

SECTION  10.02     Allocation  of Costs and Expenses and Adjustments to Purchase
Price  at  the  Closing.

(a)     At  the  Closing,  the  Purchase  Price  shall  be  increased  (without
duplication)  by  the  following  amounts:

     (i)  the  amount of all (A) paid ad valorem, property, or similar Taxes and
assessments  based  upon  or measured by the ownership of the Assets, insofar as
such  Taxes relate to periods of time from and after the Effective Time, and (B)
paid charges, costs, and expenses of any kind or nature that are attributable to
the  Assets  and  the  period  from  and  after  Effective  Time;

     (ii)  all  expenses, including operating and capital expenditures, incurred
and  paid by or on behalf of Seller in connection with ownership, operation, and
use  of the Assets attributable to the period from and after the Effective Time,
and  including  the  costs  incurred  in  connection  with the AFEs described on
Schedule  5.08  which costs shall be the responsibility of Buyer notwithstanding
that  they  may  have  been  committed  to  prior  to  the  Effective  Time;

<PAGE>
     (iii)  all  royalties,  rentals,  insurance  premiums,  and  other  charges
attributable to the Assets for the period of, from, and after the Effective Time
to  the  extent  paid  by  or  on  behalf  of  Seller;

     (iv)  expenses incurred under applicable operating agreements including any
overhead  charges  allowable  under  the  applicable operating procedure (COPAS)
where  Seller  is non-operator attributable to the Assets for the period of from
and  after  the  Effective  Time  to  the extent paid by or on behalf of Seller;

     (v)  [Intentionally  Omitted];

     (vi)  the  value  of all oil, gas, and natural gas liquids in storage or in
the  pipelines  as  of  the  Effective Time that is credited to the Assets, such
value  (A)  for  purposes  of the Statement, to be the actual price received for
such  oil,  gas,  or natural gas liquids upon the first unaffiliated third party
sale  thereof,  if  available,  and upon such estimates as are reasonably agreed
upon  by the Parties, to the extent actual amounts are not known at Closing, and
(B)  for  purposes  of  the  Final Settlement Statement, to be based upon actual
amounts;  and

     (vii)  any  other  amount  provided for in this Agreement or agreed upon in
writing  by  Buyer  and  Seller.

(b)     At  the  Closing,  the  Purchase  Price  shall  be  decreased  (without
duplication)  by  the  following  amounts:

     (i)  the  Deposit;

     (ii)  an  amount  equal  to  the  sales  price  paid to Seller by the first
purchaser  of  the  Hydrocarbons  produced,  saved,  and  sold  from the Subject
Interests from the Effective Time to the Closing Date (without deductions of any
kind  or nature, including, but not limited to, royalties and any Taxes based on
production), which shall (A) for purposes of the Statement, be based upon actual
amounts,  if available, and upon such estimates as are reasonably agreed upon by
the  Parties, to the extent actual amounts are not known at Closing, and (B) for
purposes  of  the  Final  Settlement  Statement,  be  based upon actual amounts;

     (iii) an amount equal to all cash in, or attributable to, suspense accounts
held by Seller relating to the Assets for which Buyer has assumed responsibility
under  Section  12.01;

     (iv)  the  Allocated  Value  of  any Asset sold prior to the Closing to the
holder  of  a  preferential  right  pursuant  to  Section  4.06;

     (v)  the  Allocated  Value of any Asset excluded from the purchase and sale
contemplated  herein  pursuant  to  the  provisions  of  Article  4;

     (vi)  all  downward  Purchase  Price  adjustments  for  Title  Defects  and
Environmental  Defects  determined  in  accordance  with  Article  4;  and

<PAGE>
     (vii)  any  other  amount  provided for in this Agreement or agreed upon in
writing  by  Buyer  and  Seller.

(c)     The allocations of costs and expenses and/or adjustments to the Purchase
Price  described in Section 10.02(a) and Section 10.02(b) are referred to herein
as  the  "Purchase  Price  Allocations  and  Adjustments."

SECTION 10.03     Closing Adjustments and Allocations Statement.  Not later than
seven  (7)  days  prior to the Closing Date, Seller shall prepare and deliver to
Buyer  a  statement  of the estimated Purchase Price Allocations and Adjustments
with  appropriate support (the "Statement"), which Statement shall be based upon
the  then  most  currently  available  data and information in order to make the
adjustments  as  provided  in  Section  10.02.

SECTION  10.04     Post-Closing  Allocations  and Adjustments to Purchase Price.

(a)     On  or  before  90 days after the Closing Date, Seller shall prepare and
deliver  to  Buyer  a  revised  Statement ("Final Settlement Statement") setting
forth  the  actual Purchase Price Allocations and Adjustments.  Each Party shall
provide  the  other  such data and information as may be reasonably requested to
permit  Seller  to  prepare the Final Settlement Statement or to permit Buyer to
perform  or  cause  to  be performed an audit of the Final Settlement Statement.
The  Final  Settlement Statement shall become final and binding upon the Parties
on  the  thirtieth  (30th)  day  following  receipt thereof by Buyer (the "Final
Settlement  Date")  unless  Buyer  gives  written  notice of its disagreement (a
"Notice  of  Disagreement")  to  Seller  prior  to  such  date.  Any  Notice  of
Disagreement shall specify in reasonable detail the dollar amount and the nature
and  basis  of  any  disagreement  so  asserted.  If a Notice of Disagreement is
received  by  Seller  in  a  timely  manner,  then the Parties shall resolve the
dispute  evidenced  by  the  Notice  of  Disagreement  by  mutual  agreement, or
otherwise  in  accordance  with  Section  4.13.

(b)     If  the  amount of the adjusted Purchase Price as set forth on the Final
Settlement  Statement exceeds the amount of the estimated Purchase Price paid at
the  Closing pursuant to the Statement delivered pursuant to Section 10.03, then
Buyer shall pay in immediately available funds to Seller the amount by which the
Purchase Price as set forth on the Final Settlement Statement exceeds the amount
of  the  estimated  Purchase  Price paid at the Closing within five (5) business
days  after  the  Final Settlement Date.  If the amount of the adjusted Purchase
Price  as set forth on the Final Settlement Statement is less than the amount of
the  estimated  Purchase  Price  paid  at  the Closing pursuant to the Statement
delivered  pursuant  to  Section  10.03,  then  Seller  shall pay in immediately
available  funds to Buyer the amount by which the Purchase Price as set forth on
the Final Settlement Statement is less than the amount of the estimated Purchase
Price  paid  at  the  Closing  within  five  (5)  business  days after the Final
Settlement  Date.

(c)     Pursuant to Section 10.02(b), the Purchase Price is to be reduced by the
value  of Hydrocarbons produced during the period from the Effective Time to the
Closing  Date.  If  Buyer  shall  receive  any  revenues  attributable  to  such
Hydrocarbons  for

<PAGE>
any  reason  for  which  Buyer  has  received  a reduction in the Purchase Price
pursuant  to  this  Section  10.04(c),  Buyer  shall  promptly  remit  same  in
immediately available funds to Seller.  Likewise, if Seller shall for any reason
receive  any of the proceeds of sale of Hydrocarbons produced and saved from the
Subject Interests and attributable to the period from and after the Closing Date
or  any  other revenues attributable to the ownership or operation of the Assets
from  and  after  the  Effective  Time,  Seller  shall  promptly  remit  same in
immediately  available  funds  to  Buyer.

(d)     Except  as otherwise provided in this Agreement, any costs and expenses,
including  Taxes  (other than income taxes) relating to the Assets which are not
reflected  in  the  Final  Settlement  Statement  shall  be  treated as follows:

     (i)  All  costs  and expenses relating to the Assets for the period of time
prior  to  the  Effective Time shall be the sole obligation of Seller and Seller
shall promptly pay, or if paid by Buyer, promptly reimburse Buyer in immediately
available  funds  for  and  indemnify,  defend, and hold Buyer harmless from and
against  the  same;  and

     (ii)  All  costs and expenses relating to the Assets for the period of time
on  or  after the Effective Time shall be the sole obligation of Buyer and Buyer
shall  promptly  pay,  or  if  paid  by  Seller,  promptly  reimburse  Seller in
immediately  available funds for and indemnify, defend, and hold Seller harmless
from  and  against  the  same.

(e)     Purchase  Price  adjustments,  if  any, with respect to Title Defects or
Environmental  Defects the cure or correction of which or a dispute with respect
to the same remains pending on the Final Settlement Date shall be made on a date
mutually  agreed  by  the  Parties,  both  acting  reasonably.

SECTION  10.05     Transfer  Taxes.  All  sales,  use,  documentary,  recording,
stamp,  transfer,  and other taxes (other than taxes on gross income, net income
or  gross receipts) and duties, levies, assessments, fees, or other governmental
charges incurred by or imposed with respect to the property transfers undertaken
pursuant to this Agreement shall be the responsibility of, and shall be paid by,
Buyer.  The  Parties  will  reasonably  cooperate  to  eliminate  or  reduce the
assessment  of sales or use taxes to the extent permitted by applicable Law.  If
Seller  (not  Buyer)  is  required  by  applicable  Law to appeal or protest the
assessment  of  sales or use taxes, Seller shall protest the assessment of those
taxes  if  Buyer requests Seller in writing to make such appeal or protest, and,
in such event, Buyer will reimburse Seller all out-of-pocket expenses authorized
by  Buyer  and  incurred  by  Seller  in connection with such appeal or protest.

SECTION  10.06     Ad  Valorem  and  Similar  Taxes.  All  ad valorem, property,
production, severance, and similar Taxes attributable to any period prior to the
Effective  Time will be paid by the Seller, including Taxes due on account of an
audit  by  a taxing authority.  All ad valorem, property, production, severance,
and  similar  Taxes  attributable  to  any period on or after the Effective Time
shall  be  paid  by  Buyer.  Notwithstanding

<PAGE>
anything  to  the contrary set forth in this Agreement, for all purposes of this
Agreement, Taxes based on or measured by production of Hydrocarbons or the value
thereof  shall be deemed attributable to the period during which such production
occurred  regardless  of  the  year  when such Taxes are assessed.  Seller shall
provide  written  evidence to Buyer that it has paid all Taxes for periods prior
to  the  Effective  Time  that  are  payable  after the Effective Time including
production  Taxes  in the States of Montana and Wyoming, provided such Taxes are
based  on  production  occurring  prior  to  the  Effective  Time.

SECTION  10.07     Actions  of  Seller  at  the Closing.  At the Closing, Seller
shall:

(a)     execute, acknowledge, and deliver to Buyer the Assignment in the form of
Exhibit  D,  effective  as  of  the  Effective Time, and such other conveyances,
assignments,  transfers,  bills  of  sale,  and  other  instruments (in form and
substance  mutually  agreed  upon  by  Buyer  and Seller) as may be necessary or
desirable  to  convey  the  Assets  to  Buyer;

(b)     execute, acknowledge, and deliver to Buyer the Mineral Quitclaim Deed in
the  form  of  the  attached  Exhibit  E, effective as of the Effective Time, to
convey  certain  fee  mineral  interests  located  in  the  State  of  Wyoming;

(c)     execute,  acknowledge,  and  deliver  to  Buyer  such letters in lieu of
transfer or division orders as may be reasonably requested by Buyer no less than
five  (5)  business  days  prior to the Closing Date directing all purchasers of
production  from  the Subject Interests to make payment of proceeds attributable
to  such production to Buyer from and after the later of the Closing Date or the
date  operations  and  accounting  functions  are  transferred  to  Buyer;

(d)     deliver  to  Buyer  possession  of  the  Assets (excluding the Records);

(e)     execute  and  deliver to Buyer affidavits attesting to their non-foreign
status;

(f)     execute,  acknowledge,  and  deliver  any  other agreements provided for
herein, including without limitation a transition services agreement agreed upon
by  the  Parties  pursuant  to Section 7.03 herein, or necessary or desirable to
effect  the  transactions  contemplated  hereby;  and

(g)     execute  and  deliver  any  documents  or  instruments  required  by any
Governmental Authority in order to transfer the operatorship of the Assets being
operated  by  Seller  to  Buyer.

SECTION 10.08     Actions of Buyer at the Closing.  At the Closing, Buyer shall:

<PAGE>
(a)     pay  the  Purchase Price (as adjusted pursuant to the provisions hereof)
in  immediately  available  funds  pursuant  to wire transfer instructions to be
provided  by  Seller  to  Buyer;

(b)     provide  any  necessary  evidence  including proof of proper bonding and
other  qualifications to be entitled to take and actually take possession of the
Assets;

(c)     execute,  acknowledge,  and  deliver  the  Assignment  and  any  other
agreements  provided  for  herein,  including  without  limitation  a transition
services  agreement  agreed upon by the Parties pursuant to Section 7.03 herein,
or  necessary  or  desirable to effect the transactions contemplated hereby; and

(d)     if  required pursuant to Section 14.08, execute and deliver to Seller an
Assignment Agreement in the form of Exhibit G and a Parent Guarantee in the form
of  Exhibit  H.

SECTION  10.09     Recordation;  Further  Assurances.

(a)     Promptly  following  the  Closing,  Buyer  shall  cause  the  documents
identified  in  Section 10.07(a) and Section 10.07(b) to be properly recorded or
filed  in  the  appropriate  real  property and other applicable records, in the
order  reasonably  agreed  upon by the Parties, and Buyer shall promptly provide
Seller  copies  of  all  such  recorded  or  filed  instruments.

(b)     Subject  to  such  additional  period  of  time  that  Seller reasonably
requires  to  use the Records in the conduct of operations after Closing, Seller
shall  make  the  Records  available  to be picked up by Buyer at the offices of
Seller  during  normal  business  hours within 30 days after the Closing, to the
extent  the  Records  are  in  the  possession  of Seller and are not subject to
contractual restrictions on transferability.  Seller shall have the right at its
sole  expense  to  make  and  retain  copies  of  any  of  the  Records.

(c)     After  the  Closing  Date, each Party, at the request of the other Party
and  without additional consideration, shall execute and deliver, or shall cause
to  be  executed  and  delivered,  from time to time such further instruments of
conveyance  and transfer and shall take such other action as the other Party may
reasonably  request  to convey and deliver the Assets to Buyer and to accomplish
the  orderly  transfer of the Assets to Buyer in the manner contemplated by this
Agreement.  After  the  Closing, the Parties will cooperate to have all proceeds
received attributable to the Assets to be paid to the proper Party hereunder and
to  have  all  expenditures to be made with respect to the Assets be made by the
proper  Party  hereunder.

                                  ARTICLE  11

                                  TERMINATION

SECTION 11.01     Right of Termination.  This Agreement may be terminated at any
time  at  or  prior  to  the  Closing:

<PAGE>

(a)     by  mutual  written  consent  of  the  Parties;

(b)     by  Seller  on the Closing Date if the conditions set forth in Article 8
have not been satisfied in all material respects by Buyer or waived by Seller in
writing  by  the  Closing  Date;

(c)     by  Buyer  on  the Closing Date if the conditions set forth in Article 9
have not been satisfied in all material respects by Seller or waived by Buyer in
writing  by  the  Closing  Date;

(d)     by  Seller  if  the  Closing  shall not have occurred by March 16, 2011;
provided,  however,  if  the  Parties mutually agree, such date may be extended;

(e)     by  either  Buyer  or  Seller  if  any Governmental Authority shall have
issued  a  final and non-appealable order, judgment or decree or taken any other
final and non-appealable action challenging, restraining, enjoining, prohibiting
or invalidating the consummation of any of the transactions contemplated herein;

(f)     by  either  Buyer  or  Seller  if  (i) the aggregate amount of the Title
Defect Values with respect to all Title Defects asserted by Buyer reasonably and
in good faith  plus (ii) the aggregate amount of the Environmental Defect Values
with  respect  to  all Environmental Defects asserted by Buyer reasonably and in
good faith plus (iii) the aggregate amount of all Casualty Losses exceeds twenty
percent  (20%)  of  the  unadjusted  Purchase  Price;  or

(g)     by  either  Buyer  or  Seller if between execution of this Agreement and
Closing,  an  event  should  occur  having  a  Material  Adverse  Effect  on the
ownership,  operation  or  value  of  the  Assets.

provided,  however,  that  no  Party  shall  have  the  right  to terminate this
Agreement  pursuant  to  clause  (b), (c), or (d) above if such Party is at such
time  in  Breach  of any provision of this Agreement, or such Party instigates a
proceeding  of  the  nature  described  in  Section  8.03  or  Section  9.03.

SECTION  11.02     Effect  of  Termination.  In  the event that the Closing does
not occur as a result of any Party exercising its right to terminate pursuant to
Section 11.01, then except as set forth in Section 2.02, this Agreement shall be
null  and  void  and no Party shall have any further rights or obligations under
this  Agreement; provided, that, nothing herein shall relieve any Party from any
liability  for  any Breach hereof or any liability that has accrued prior to the
date  of  such  termination,  which  liability,  and  the  applicable  terms and
provisions  of  this  Agreement,  shall  survive  such  termination.

<PAGE>
SECTION  11.03     Attorneys'  Fees,  Etc.  If  either  Party  to this Agreement
resorts  to legal proceedings to enforce this Agreement, the prevailing Party in
such  proceedings shall be entitled to recover all costs incurred by such Party,
including  reasonable  attorneys' fees, in addition to any other relief to which
such  Party  may  be  entitled.  This  Section  11.03  shall  not  apply  to any
proceeding  under  Section  4.13.

                                  ARTICLE  12

                         ASSUMPTION AND INDEMNIFICATION

SECTION  12.01     Buyer's  Obligations  after Closing.  Upon and after Closing,
except  to  the  extent  reflected  in  an upward Purchase Price Allocations and
Adjustments, Buyer will assume and perform all the obligations, liabilities, and
duties  relating or with respect to the ownership and/or operation of the Assets
that  are  attributable to periods on or after the Effective Time, together with
the  matters  described on Schedule 5.06,  Plugging and Abandonment Obligations,
the  Environmental Obligations, and all other obligations assumed by Buyer under
this  Agreement (collectively, the "Assumed Obligations").  Without limiting the
generality  of  the  foregoing,  the Assumed Obligations shall also specifically
include:

(a)     Responsibility  for  the  performance  of  all  express  and  implied
obligations  under  the  instruments  described  in Exhibit A, together with all
other  instruments  in  the  chain  of  title  to  such  Assets, the Leases, the
Contracts, the Surface Agreements, the Permits, and all other orders, contracts,
and  agreements  to  which  the  Assets  are  subject,  including the payment of
royalties  and  overriding royalties, in each case to the extent attributable to
the  periods  on  or  after  the  Effective  Time;

(b)     Responsibility  for  payment of all amounts held in suspense accounts by
Seller  as  of  the  Closing  Date, and for which the Purchase Price is adjusted
pursuant  to  Section  10.02(b), without regard to whether such suspense amounts
relate  to  periods  before  or  after the Effective Time.  Seller covenants and
agrees  to  provide  to Buyer with the Records, the owner name, address, and tax
identification  number  (if  known  by  Seller),  the reason such amounts are in
suspense,  the  amount of suspense funds for each such owner making up the total
of  such  funds,  and  all other information with respect thereto required to be
provided  to the owner or to the state under the laws, rules, and regulations of
the affected jurisdiction.  To the extent practicable, Seller shall provide such
information  in  the  electronic or computer sensible form maintained by Seller;

(c)     Responsibility  for  compliance with all Laws now or hereafter in effect
pertaining  to  the  Assets, and the procurement and maintenance of all permits,
consents,  and  authorizations  of  or  required  by Governmental Authorities in
connection  with  the  Assets, attributable to periods on or after the Effective
Time;  and

(d)     Responsibility  for those royalty and overriding royalty payments placed
by  Seller  in  escrow  accounts,  which  responsibility  shall  include  the
establishment  of  an  escrow  account  by Buyer to receive such funds placed in
escrow  by  Seller.

<PAGE>
SECTION 12.02     Seller's Obligations after Closing.  After Closing and subject
to  Section 12.10 and Section 12.11 below, Seller will retain responsibility for
(a)  the  payment  of all operating expenses and capital expenditures related to
the Assets and attributable to Seller's ownership and/or operation of the Assets
prior  to  the  Effective Time, but not including the AFEs set forth in Schedule
5.08,  (b)  severance,  ad valorem, production, property, personal property, and
similar  Taxes measured by the value of the Assets or measured by the production
of Hydrocarbons attributable to all periods prior to the Effective Time, (c) the
payment  of  all  broker's and finder's fees in connection with the transactions
contemplated  by this Agreement, (d) the obligations, liabilities, and duties of
Seller  relating or with respect to the ownership and/or operation of the Assets
prior to the Effective Time other than the matters addressed in Section 12.01(b)
and described on Schedule 5.06, the Plugging and Abandonment Obligations and the
Environmental  Obligations,  and  (e)  Seller's proportionate share of any third
party  Claims  with  respect  to  payments  of lease royalties in respect of the
Leases  during  Seller's  period  of  ownership of such Leases (collectively the
"Retained  Obligations").

SECTION  12.03     Plugging  and  Abandonment  Obligations.

(a)     Buyer's  Obligations.  Provided  Closing  occurs,  Buyer  assumes  full
responsibility  and  liability  for  the  following  plugging  and  abandonment
obligations  related to the Assets (the "Plugging and Abandonment Obligations"),
regardless of whether they are attributable to the ownership or operation of the
Assets  before  or  after  the  Effective  Time:

     (i)  The  necessary and proper plugging, replugging, and abandonment of all
wells on the Assets, whether plugged and abandoned before or after the Effective
Time  in  compliance  with  applicable  Laws  and  the  terms  of  the  Leases;

     (ii)  The  necessary  and proper decommissioning, removal, abandonment, and
disposal  of all structures, pipelines, facilities, equipment, abandoned Assets,
junk,  and  other  personal  property  located  on or comprising any part of the
Assets  in  compliance  with  applicable  Laws  and  the  terms  of  the Leases;

     (iii)  The  necessary and proper capping and burying of all associated flow
lines located on or comprising any part of the Assets, to the extent required by
applicable  Laws,  the  Leases,  the  Contracts,  or  other  agreements;

     (iv)  The  necessary and proper restoration of the Assets, both surface and
subsurface,  in  compliance  with  any  applicable Laws, the Leases, the Surface
Agreements,  the  Contracts,  or  any  other  applicable  agreements;

     (v)  To  the  extent not addressed by operation of Article 4, any necessary
clean-up  or  disposal  of any part of the Assets contaminated by NORM, asbestos
containing  materials,  lead  based  paint, or any other substances or materials
considered  to  be  hazardous under Laws, including Environmental Laws, and Laws
relating  to  the  protection  of  natural  resources;

<PAGE>
     (vi) All obligations arising from contractual requirements and demands made
by Governmental Authorities or parties claiming a vested interest in any part of
the  Assets;  and

     (vii)  Obtaining  and  maintaining  all  bonds  and  securities,  including
supplemental  or  additional  bonds or other securities, that may be required by
contract  or  by  Governmental  Authorities.

(b)     Standard  of  Operations.  Buyer  shall  conduct  all  Plugging  and
Abandonment Obligations and all other operations with respect to the Assets in a
good  and  workmanlike  manner  and  in  compliance  with  all  Laws,  including
Environmental  Laws  and  Laws  (now  or  hereafter  in  effect) relating to the
protection  of  natural  resources.

SECTION  12.04     Environmental  Obligations.  Provided  Closing  occurs, Buyer
assumes full responsibility and liability for the following occurrences, events,
conditions, and activities on, or related to, or attributable to the Assets (the
"Environmental  Obligations")  regardless  of  whether  arising  from  Seller's
ownership  or  operation  of,  or  relating  to,  the Assets before or after the
Effective  Time,  AND REGARDLESS OF WHETHER RESULTING FROM ANY ACTS OR OMISSIONS
OF  SELLER  OR ITS REPRESENTATIVES (INCLUDING THOSE ARISING FROM THE SOLE, JOINT
OR  CONCURRENT  NEGLIGENCE  (BUT  NOT  GROSS  NEGLIGENCE OR WILLFUL MISCONDUCT),
STRICT  LIABILITY,  OR  OTHER  LEGAL  FAULT  OF  SELLER  OR  ANY  OF  SELLER'S
REPRESENTATIVES)  or the condition, including the environmental condition of the
Assets  when  acquired:

(a)     Environmental  pollution  or  contamination,  including  pollution  or
contamination  of  the soil, groundwater, or air by Hydrocarbons, drilling fluid
and other chemicals, brine, produced water, NORM, asbestos containing materials,
lead  based  paint,  mercury, or any other substance, and any other violation of
Environmental Laws or Laws now or hereafter in effect relating to the protection
of  natural  resources;

(b)     Underground  injection  activities  and  waste  disposal;

(c)     Clean-up responses, and the cost of remediation, control, assessment, or
compliance  with  respect  to surface and subsurface pollution caused by spills,
pits,  ponds,  lagoons,  or  storage  tanks;

(d)     Failure  to  comply  with  applicable  land  use,  surface  disturbance,
licensing,  or  notification  requirements;

(e)     Disposal  on  the Assets of any hazardous substances, wastes, materials,
and products generated by or used in connection with the ownership, development,
operation,  or  abandonment  of  any  part  of  the  Assets;

(f)     Non-compliance with Environmental Laws (now or hereafter in effect); and

(g)     Third-party  Claims  based  on  alleged  damage  to  water  wells.

<PAGE>
SECTION 12.05     Definition of Claims.  Except as expressly provided in Section
4.09(a)(viii),  the term "Claims" means any and all direct or indirect, demands,
claims,  notices  of  violation,  notices  of  probable  violation,  filings,
investigations,  administrative  proceedings,  actions, causes of action, suits,
other  legal  proceedings, judgments, assessments, damages, deficiencies, Taxes,
penalties, fines, obligations, responsibilities, liabilities, payments, charges,
losses,  costs,  and  expenses  (including  costs  and expenses of operating the
Assets)  of  any  kind  or  character  asserted by a third party (whether or not
asserted  prior  to  Closing,  and  whether  known or unknown, fixed or unfixed,
conditional  or  unconditional,  based  on  negligence,  strict  liability  or
otherwise, choate or inchoate, liquidated or unliquidated, secured or unsecured,
accrued,  absolute,  contingent, or other legal theory), including penalties and
interest on any amount payable as a result of any of the foregoing, any legal or
other  costs and expenses incurred in connection with investigating or defending
any  Claim,  and all amounts paid in settlement of Claims.  Without limiting the
generality of the foregoing, the term "Claims" specifically includes any and all
Claims  arising  from,  attributable  to  or incurred in connection with any (a)
breach  of  contract,  (b)  loss  or  damage  to property, injury to or death of
persons,  and  other  tortuous  injury  and  (c)  violations of applicable Laws,
including  Laws  relating  to the protection of natural resources, Environmental
Laws  (each  as  now  or  hereafter in effect) and any other legal right or duty
actionable  at  law  or  equity.

SECTION  12.06     Application  of  Indemnities.

(a)     All  indemnities  set  forth  in  this Agreement extend to the officers,
directors,  partners,  managers,  members,  shareholders,  agents,  contractors,
employees,  and  affiliates  of  the  indemnified  party  ("Representatives").

(b)     UNLESS  THIS AGREEMENT EXPRESSLY PROVIDES TO THE CONTRARY, THE INDEMNITY
AND  RELEASE,  AND  WAIVER AND ASSUMPTION PROVISIONS SET FORTH IN THIS AGREEMENT
APPLY,  REGARDLESS  OF  WHETHER  THE  INDEMNIFIED PARTY (OR ITS REPRESENTATIVES)
CAUSES,  IN  WHOLE  OR  PART, AN INDEMNIFIED CLAIM, INCLUDING INDEMNIFIED CLAIMS
ARISING OUT OF OR RESULTING, IN WHOLE OR IN PART, FROM, OUT OF, OR IN CONNECTION
WITH  THE  CONDITION  OF THE ASSETS OR THE SOLE, JOINT, OR CONCURRENT NEGLIGENCE
(BUT  NOT  SECURITIES  FRAUD  CLAIMS  THAT  REQUIRE SCIENTER OR KNOWLEDGE AS ONE
ELEMENT  OF THE CAUSE OF ACTION, WILLFUL MISCONDUCT, OR FRAUD BY THE INDEMNIFIED
PARTY),  STRICT  LIABILITY, OR OTHER LEGAL FAULT OF THE INDEMNIFIED PARTY OR ANY
OF  ITS  REPRESENTATIVES.

(c)     NEITHER  BUYER  NOR  SELLER  SHALL BE ENTITLED TO RECOVER FROM THE OTHER
PARTY(IES),  RESPECTIVELY, AND EACH PARTY RELEASES THE OTHER PARTY(IES) FROM AND
WAIVES,  ANY LOSSES, COSTS, EXPENSES, OR DAMAGES ARISING UNDER THIS AGREEMENT OR
IN  CONNECTION  WITH  OR  WITH  RESPECT  TO  THE

<PAGE>
TRANSACTIONS  CONTEMPLATED  IN THIS AGREEMENT ANY AMOUNT IN EXCESS OF THE ACTUAL
COMPENSATORY  DAMAGES  SUFFERED BY SUCH PARTY EXCEPT THAT IF THE DISPUTE BETWEEN
SELLER AND BUYER IS BASED ON A FAILURE OF THE TRANSACTION CONTEMPLATED HEREBY TO
CLOSE,  THE  SOLE  AND EXCLUSIVE REMEDIES SHALL BE THOSE PROVIDED FOR IN SECTION
2.02.  BUYER  AND SELLER WAIVE, AND RELEASE EACH OTHER FROM ANY RIGHT TO RECOVER
PUNITIVE,  SPECIAL,  EXEMPLARY,  AND CONSEQUENTIAL DAMAGES ARISING IN CONNECTION
WITH  OR  WITH  RESPECT  TO  THE  TRANSACTIONS  CONTEMPLATED  IN THIS AGREEMENT;
PROVIDED,  HOWEVER,  ANY  SUCH  DAMAGES  RECOVERED  BY A THIRD PARTY (OTHER THAN
SUBSIDIARIES,  AFFILIATES,  OR  PARENTS  OF  A PARTY) FOR WHICH A PARTY OWES THE
OTHER  PARTY  AN  INDEMNITY UNDER THIS AGREEMENT SHALL NOT BE WAIVED.  BUYER AND
SELLER  ACKNOWLEDGE  THAT  THIS  STATEMENT  IS  CONSPICUOUS.

(d)     The indemnities of the indemnifying Party in this Agreement do not cover
or  include any amounts that the indemnified Party may legally recoup from other
third  party  owners  under  applicable  joint  operating  agreements  or  other
agreements,  and  for  which  the  indemnified  Party is reimbursed by any third
party.  The  indemnifying  Party  will pay all costs incurred by the indemnified
Party in obtaining reimbursement from third parties.  There will be no upward or
downward  adjustment  in  the Purchase Price as a result of any matter for which
Buyer  or  Seller  is  indemnified  under  this  Agreement.

SECTION  12.07     Buyer's  Indemnity.  Subject  to  Section  12.10, Buyer shall
release  and  indemnify, defend and hold Seller and its Representatives harmless
from  and against any and all Claims caused by, resulting from, or incidental to
the  Assumed  Obligations,  and  any  Claims  caused  by,  resulting  from,  or
attributable  to  (a) the Breach as of the Closing Date of any representation or
warranty  of Buyer set forth in this Agreement, or (b) any Breach of, or failure
to  perform  or satisfy any of the covenants and obligations of Buyer hereunder.

SECTION  12.08     Seller's  Indemnity.  Subject  to  Section  12.10 and Section
12.11,  Seller  shall  release  and  indemnify,  defend  and  hold Buyer and its
Representatives  harmless  from  and  against  any  and  all  Claims  caused by,
resulting from, or incidental to the Retained Obligations, and any Claims caused
by,  or  resulting from, or attributable to (a) the Breach as of the Title Claim
Date  of  any  representation  or  warranty  of  Seller  except  those  matters
constituting  a Title Defect or an Environmental Defect that may also constitute
a Breach of the representations and warranties set forth in Sections 5.09, 5.10,
5.17, 5.18, 5.19, 5.21, 5.22, and 5.23 of this Agreement, and (b) any Breach of,
or failure to perform or satisfy, any of the covenants and obligations of Seller
hereunder.

SECTION  12.09     Notices  and Defense of Indemnified Claims.  Each Party shall
immediately  notify  the  other Party of any Claim of which it becomes aware and
for  which  it  is  entitled  to indemnification from the other Party under this
Agreement.  The  indemnifying  Party  shall  be  obligated  to  defend,  at  the
indemnifying  Party's  sole  expense,  any

<PAGE>
litigation  or  other  administrative  or  adversarial  proceeding  against  the
indemnified  Party  relating  to  any Claim for which the indemnifying Party has
agreed  to  release  and indemnify and hold the indemnified Party harmless under
this  Agreement;  provided,  however, that the failure to give such notice shall
not  relieve  the indemnifying Party from its obligations unless such failure to
give notice actually prejudices the indemnifying Party and so long as the notice
is  given  within  the period set forth in Section 12.10.  The indemnified Party
shall  have  the right to participate with the indemnifying Party in the defense
of  any  such  Claim  at  its  own  expense.

SECTION  12.10     Survival.  Except  as  specifically provided in Section 12.07
and Section 12.08, the representations, warranties, covenants, and agreements of
the Parties set forth herein shall not survive the Closing, and the consummation
of the transactions contemplated hereby, and Buyer and Seller each covenants not
to  sue  the  other based upon any alleged Breach of any such representations or
warranties that do not survive the Closing.  The indemnity of Seller as provided
in  Section 12.08 shall survive only for a period of one (1) year from and after
the  Closing Date.  Notwithstanding anything to the contrary, Buyer shall not be
entitled to make, and hereby waives the right to assert, any claim for indemnity
pursuant  to the provisions of this Article 12 against Seller unless Buyer seeks
indemnification  for  such  claim  by  a written notice received by Seller on or
before  the  date  that  is one (1) year after the Closing Date (the "Expiration
Date").  ANYTHING  IN  THIS AGREEMENT TO THE CONTRARY NOTWITHSTANDING, AFTER THE
EXPIRATION  DATE,  ALL  OF  THE  RETAINED  OBLIGATIONS AND ALL OF SELLER'S OTHER
LIABILITIES  AND  OBLIGATIONS  WITH  RESPECT  TO THE ASSETS (AND ALL CLAIMS WITH
RESPECT  THERETO)  SHALL BE DEEMED AND CONSTITUTE ASSUMED OBLIGATIONS, EXCEPT TO
THE  EXTENT  OF  ANY  CLAIMS  OF  WHICH  BUYER  NOTIFIES SELLER ON OR BEFORE THE
EXPIRATION  DATE  IN  ACCORDANCE  WITH  THIS  AGREEMENT.  NOTWITHSTANDING  THE
FOREGOING,  SELLER'S  OBLIGATIONS  WITH  RESPECT  TO AD VALOREM TAXES SUBJECT TO
SECTION  10.06  SHALL  INDEFINITELY  SURVIVE.

SECTION  12.11     Limitation  on  Seller's  Indemnity.  SELLER'S  AGGREGATE
LIABILITY HEREUNDER SHALL NOT EXCEED, AND SHALL BE LIMITED TO, TEN PERCENT (10%)
OF  THE  UNADJUSTED  PURCHASE  PRICE.  FURTHER  NOTWITHSTANDING  THE  FOREGOING,
SELLER'S OBLIGATIONS AS TO AD VALOREM TAXES SUBJECT TO SECTION 10.06 SHALL BE IN
NO  MANNER  AFFECTED  OR  OTHERWISE  LIMITED  BY  THIS  SECTION  12.11.

SECTION 12.12     Exclusive Remedy.  The terms and provisions of this Article 12
and  those  provided  in  Article 2, Article 4, Article 7, Article 8, Article 9,
Article 10, and Article 11 shall be the sole and exclusive remedy of each of the
Parties  indemnified  hereunder with respect to the representations, warranties,
covenants,  and  agreements  of  the Parties set forth in this Agreement and the
other  documents  executed  and

<PAGE>
delivered  hereunder;  provided,  however,  that the terms of this Section 12.12
shall  not  be  applicable  to  the  extent  that  a  Party has committed fraud,
securities  fraud  (where one of the elements of the cause of action is scienter
or  knowledge),  willful  misconduct,  or  gross  negligence.

SECTION  12.13     Defenses  and  Counterclaims.  Each Party that is required to
assume any obligation or liability of the other Party pursuant to this Agreement
or  that  is  required  to release and defend, indemnify or hold the other Party
harmless  hereunder  shall,  notwithstanding  any  other provision hereof to the
contrary,  be  entitled  to  the  use  and  benefit  of  all defenses (legal and
equitable)  and  counterclaims  of  such  other  Party in defense of third party
Claims  arising  out  of  any  such  assumption  or  indemnification.

SECTION  12.14     Anti-Indemnity  Statute.  Buyer  and  Seller  agree that with
respect  to  any  statutory limitations now or hereafter in effect affecting the
validity  or  enforceability  of the indemnities provided for in this Agreement,
such  indemnities  shall  be  deemed  amended  in  order  to  comply  with  such
limitations.  This provision concerning statutory limitations shall not apply to
indemnities  for  all liabilities of the indemnifying Party which are covered by
such Party's insurance.  The indemnification provisions provided in this Article
12 shall not be construed as a form of insurance.  Buyer and Seller hereby waive
for  themselves  and their successors and assigns, including their insurers, any
subrogation  for Claims for which each of them is respectively liable or against
which  each  respectively  indemnifies  for  the  other,  and,  if  required  by
applicable  policies,  Buyer  and Seller shall obtain waiver of such subrogation
from  their  respective  insurers.

                                  ARTICLE  13

                  DISCLAIMERS; CASUALTY LOSS AND CONDEMNATION

SECTION  13.01     Disclaimers  of  Representations and Warranties.  THE EXPRESS
REPRESENTATIONS  AND  WARRANTIES  OF  SELLER  CONTAINED  IN  THIS  AGREEMENT ARE
EXCLUSIVE  AND  ARE IN LIEU OF ALL OTHER REPRESENTATIONS AND WARRANTIES, WHETHER
EXPRESS,  IMPLIED,  AT COMMON LAW, OR STATUTORY.  BUYER ACKNOWLEDGES THAT SELLER
HAS  NOT  MADE,  AND  SELLER  HEREBY  EXPRESSLY DISCLAIMS AND NEGATES, AND BUYER
HEREBY  EXPRESSLY  WAIVES,  ANY REPRESENTATION OR WARRANTY, EXPRESS, IMPLIED, AT
COMMON  LAW,  BY  STATUTE,  OR  OTHERWISE,  RELATING  TO  (A)  PRODUCTION RATES,
RECOMPLETION  OPPORTUNITIES, DECLINE RATES, INFORMATION IN RESPECT OF PRODUCTION
IMBALANCES, OR THE QUALITY, QUANTITY, OR VOLUME OF THE RESERVES OF HYDROCARBONS,
IF  ANY,  ATTRIBUTABLE  TO  THE  ASSETS,  (B)  THE  ACCURACY,  COMPLETENESS,  OR
MATERIALITY OR SIGNIFICANCE OF ANY INFORMATION, DATA, GEOLOGICAL AND GEOPHYSICAL
DATA  (INCLUDING  ANY  INTERPRETATIONS  OR  DERIVATIVES BASED THEREON), OR OTHER
MATERIALS  (WRITTEN OR ORAL) CONSTITUTING PART OF THE ASSETS, NOW, HERETOFORE OR
HEREAFTER  FURNISHED  TO  BUYER  BY  OR  ON  BEHALF  OF

<PAGE>
SELLER,  (c) THE CONDITION, INCLUDING, THE ENVIRONMENTAL CONDITION OF THE ASSETS
AND  (d) THE COMPLIANCE OF SELLER'S PAST PRACTICES WITH THE TERMS AND PROVISIONS
OF  ANY  AGREEMENT  IDENTIFIED  IN  EXHIBIT A, OR ANY SURFACE AGREEMENT, PERMIT,
CONTRACT,  OR APPLICABLE LAWS, INCLUDING ENVIRONMENTAL LAWS AND LAWS RELATING TO
THE  PROTECTION  OF NATURAL RESOURCES, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
ARTICLE  5.  NOTWITHSTANDING  ANYTHING TO THE CONTRARY IN THIS AGREEMENT, SELLER
EXPRESSLY  DISCLAIMS  AND  NEGATES,  AND  BUYER  HEREBY  WAIVES,  AS TO PERSONAL
PROPERTY,  EQUIPMENT,  INVENTORY,  MACHINERY,  FIXTURES,  BUILDINGS,  OFFICES,
TRAILERS,  ROLLING  STOCK,  VEHICLES,  AND  GEOLOGICAL  AND  GEOPHYSICAL  DATA
(INCLUDING  ANY  INTERPRETATIONS  OR  DERIVATIVES BASED THEREON)  CONSTITUTING A
PART  OF THE ASSETS (i) ANY IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY, (ii)
ANY  IMPLIED  OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, (iii) ANY
IMPLIED  OR  EXPRESS  WARRANTY  OF CONFORMITY TO MODELS OR SAMPLES OF MATERIALS,
(iv)  ANY  IMPLIED OR EXPRESS WARRANTY THAT ANY DATA TRANSFERRED PURSUANT HERETO
IS  NONINFRINGING,  (v)  ANY  RIGHTS OF PURCHASERS UNDER APPROPRIATE STATUTES TO
CLAIM  DIMINUTION  OF  CONSIDERATION  OR  RETURN OF THE PURCHASE PRICE, (vi) ANY
IMPLIED  OR  EXPRESS WARRANTY OF FREEDOM FROM DEFECTS, WHETHER KNOWN OR UNKNOWN,
(vii)  ANY AND ALL IMPLIED WARRANTIES EXISTING UNDER APPLICABLE LAWS, AND (viii)
ANY  IMPLIED  OR EXPRESS WARRANTY REGARDING ENVIRONMENTAL LAWS, OR LAWS RELATING
TO  THE  PROTECTION  OF THE ENVIRONMENT, HEALTH, SAFETY, OR NATURAL RESOURCES OR
RELATING  TO  THE  RELEASE OF MATERIALS INTO THE ENVIRONMENT, INCLUDING ASBESTOS
CONTAINING  MATERIAL,  LEAD  BASED  PAINT,  MERCURY,  OR  ANY  OTHER  HAZARDOUS
SUBSTANCES  OR  WASTES,  IT BEING THE EXPRESS INTENTION OF BUYER AND SELLER THAT
THE  ASSETS,  INCLUDING ALL PERSONAL PROPERTY, EQUIPMENT, FACILITIES, INVENTORY,
MACHINERY,  FIXTURES,  BUILDINGS, OFFICES, TRAILERS, VEHICLES, AND ROLLING STOCK
INCLUDED  IN  THE ASSETS, SHALL BE CONVEYED TO BUYER, AND BUYER SHALL ACCEPT THE
SAME,  AS IS, WHERE IS, WITH ALL FAULTS AND IN THEIR PRESENT CONDITION AND STATE
OF  REPAIR.  BUYER  REPRESENTS  AND  WARRANTS TO SELLER THAT BUYER WILL MAKE, OR
CAUSE  TO  BE  MADE  SUCH INSPECTIONS WITH RESPECT TO SUCH ASSETS AS BUYER DEEMS
APPROPRIATE.  SELLER  AND BUYER AGREE THAT, TO THE EXTENT REQUIRED BY APPLICABLE
LAWS  (INCLUDING  ENVIRONMENTAL  LAWS  AND  LAWS  RELATING  TO THE PROTECTION OF
NATURAL  RESOURCES,  HEALTH,  SAFETY,  OR  THE ENVIRONMENT) TO BE EFFECTIVE, THE
DISCLAIMERS  OF  THE  WARRANTIES  CONTAINED  IN  THIS  SECTION ARE "CONSPICUOUS"
DISCLAIMERS  FOR  ALL  PURPOSES.

SECTION  13.02     NORM.  BUYER  ACKNOWLEDGES THAT IT HAS BEEN INFORMED THAT OIL
AND  GAS  PRODUCING  FORMATIONS  CAN  CONTAIN  NATURALLY  OCCURRING  RADIOACTIVE
MATERIAL  ("NORM").  SCALE  FORMATION  OR  SLUDGE

<PAGE>
DEPOSITS  CAN CONCENTRATE LOW LEVELS OF NORM ON EQUIPMENT AND OTHER ASSETS.  THE
ASSETS  SUBJECT  TO  THIS  AGREEMENT  MAY  HAVE  LEVELS OF NORM ABOVE BACKGROUND
LEVELS,  AND  A  HEALTH HAZARD MAY EXIST IN CONNECTION WITH THE ASSETS BY REASON
THEREOF.  THEREFORE,  BUYER  MAY NEED TO AND SHALL FOLLOW SAFETY PROCEDURES WHEN
HANDLING  THE  EQUIPMENT  AND  OTHER  ASSETS.

SECTION  13.03     Casualty  Loss;  Condemnation.

(a)     Except  as  otherwise provided in this Agreement, Buyer shall assume all
risk  of  loss  with  respect to, and any change in the condition of, the Assets
from  and  after  the Effective Time, including with respect to the depletion of
Hydrocarbons,  the  watering-out  of  any  well,  the  collapse  of casing, sand
infiltration  of  wells,  and  the  depreciation  of  personal  property.

(b)     Prior  to  the  Closing,  there  shall  not have been a material adverse
change  in  the  Assets  taken  as  a  whole  caused  by an event of casualty (a
"Casualty"),  including  but  not  limited  to, volcanic eruptions, acts of God,
fire,  explosion,  earthquake,  wind  storm,  flood,  drought, condemnation, the
exercise of any right of eminent domain, confiscation, or seizure, but excepting
depletion  due  to normal production and depreciation or failure of equipment or
casing.

(c)     If,  prior to the Closing, a Casualty occurs (or Casualties occur) which
results  in  a  reduction  in  the  value  of the Assets in excess of 20% of the
Purchase  Price  ("Casualty  Loss"), Buyer or Seller may elect to terminate this
Agreement.  If  this  Agreement  is not so terminated, then this Agreement shall
remain  in full force and effect notwithstanding any such Casualty Loss, and, at
Buyer's  sole  option,  regardless  of the value of the Casualty Loss (i) Seller
shall  retain  such  Asset  subject to such Casualty and such Asset shall be the
subject  of  an adjustment to the Purchase Price in the same manner set forth in
Section  4.03 hereof, or (ii) at the Closing, Seller shall pay to Buyer all sums
paid  to  Seller  by  reason  of such Casualty Loss, provided, however, that the
Purchase Price shall not be adjusted by reason of such payment, and Seller shall
assign,  transfer, and set over unto Buyer all of the right, title, and interest
of  Seller  in and to such Asset and any unpaid awards or other payments arising
out  of  such  Casualty  Loss.

(d)     For  purpose  of  determining  the value of a Casualty Loss, the Parties
shall  use  the  same methodology as applied in determining the value of a Title
Defect  as  set  forth  in  Section  4.03(a).

                                  ARTICLE  14

                                 MISCELLANEOUS

SECTION  14.01     Names.  As soon as reasonably possible after the Closing, but
in  no  event later than 60 days after the Closing, Buyer shall remove the names
of Seller and its affiliates, and all variations thereof, from all of the Assets
and  make  the  requisite  filings  with,  and  provide  the

<PAGE>
requisite  notices  to,  the  appropriate  Governmental Authorities to place the
title  or  other  indicia or responsibility of ownership, including operation of
the  Assets,  in  a  name  other  than  the  name  of  the  Seller or any of its
affiliates,  or  any  variations  thereof.

SECTION  14.02     Expenses.  Each  Party  shall  be  solely responsible for all
expenses,  including  due  diligence expenses, incurred by it in connection with
this  transaction,  and neither Party shall be entitled to any reimbursement for
any  such  expenses  from  the  other  Party.

SECTION  14.03     Document  Retention.  As used in this Section 14.03, the term
"Documents  shall  mean  all  files,  documents,  books, records, and other data
delivered to Buyer by Seller pursuant to the provisions of this Agreement (other
than those that Seller has retained either the original or a copy of), including
financial  and  tax  accounting  records;  land, title and division order files;
contracts;  engineering  and  well  files;  and books and records related to the
operation  of  the  Assets  prior  to  the Closing Date.  Buyer shall retain and
preserve  the  Documents  for a period of no less than seven (7) years following
the  Closing  Date  (or for such longer period as may be required by Laws of any
Governmental  Authority),  and  shall  allow  Seller  or  its representatives to
inspect  the  Documents  at  reasonable  times and upon reasonable notice during
regular  business  hours  during  such time period.  Seller shall have the right
during  such  period  to  make  copies  of  any of the Documents at its expense.

SECTION  14.04     Entire  Agreement.  This  Agreement,  the  documents  to  be
executed  and  delivered  hereunder, and the Exhibits, Schedules, and Appendices
attached  hereto  constitute the entire agreement between the Parties pertaining
to the subject matter hereof and supersede all prior agreements, understandings,
negotiations,  and  discussions,  whether  oral  or  written,  of  the  Parties
pertaining  to the subject matter hereof; provided, however, that this Agreement
does not supersede that certain Confidentiality Agreement dated August 19, 2010,
by  and  between  the  Seller  and  Buyer, which agreement shall not survive the
Closing.  No  supplement, amendment, alteration, modification, or waiver of this
Agreement shall be binding unless executed in writing by each of the Parties and
specifically  referencing  this  Agreement.

SECTION 14.05     Waiver.  No waiver of any provision of this Agreement shall be
deemed  or  shall  constitute a waiver of any other provision hereof (whether or
not  similar),  nor  shall  such  waiver  constitute  a continuing waiver unless
otherwise  expressly  provided.

SECTION  14.06     Construction.  The  captions  in  this  Agreement  are  for
convenience  only  and  shall  not  be  considered  a  part  of  or  affect  the
construction  or  interpretation  of  any  provision  of  this  Agreement.

<PAGE>
SECTION  14.07     No  Third Party Beneficiaries.  Except as provided in Section
12.06(a), nothing in this Agreement shall provide any benefit to any third party
or  entitle  any  third party to any claim, cause of action, remedy, or right of
any  kind,  it  being the intent of the Parties that this Agreement shall not be
construed  as  a  third  party  beneficiary  contract.

SECTION 14.08     Assignment.  Except as provided in Section 2.04, neither Party
may  assign  or delegate any of its rights or duties hereunder to any individual
or  entity  other  than  an  affiliate  of  such Party without the prior written
consent of the other Party and any assignment made without such consent shall be
void;  provided,  however,  in  the  event  Buyer  assigns  this Agreement to an
affiliate,  Buyer  and  its  affiliate  shall immediately execute and deliver to
Seller  an  Assignment  Agreement in the form of Exhibit G.  Except as otherwise
provided  herein,  this Agreement shall be binding upon and inure to the benefit
of  the  Parties  and  their respective permitted successors, assigns, and legal
representatives.  Notwithstanding  any  assignment  to an affiliate, Buyer shall
nevertheless  remain  liable  to  Seller  in  accordance  with the terms of this
Agreement.  To  implement  the  prior  sentence,  in the event this Agreement is
assigned  to  an affiliate of Buyer, Buyer shall execute and deliver to Seller a
Parent  Guarantee  in  the  form  of  Exhibit  H.

SECTION  14.09     Governing  Law;  Venue.  THIS  AGREEMENT, THE OTHER DOCUMENTS
DELIVERED  PURSUANT HERETO, AND THE LEGAL RELATIONS BETWEEN THE PARTIES SHALL BE
GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF WYOMING.  ANY
LITIGATION  ARISING OUT OF THIS AGREEMENT SHALL BE BROUGHT BEFORE THE FEDERAL OR
STATE  COURTS SITTING IN WYOMING, AND THE PARTIES IRREVOCABLY WAIVE ANY RIGHT TO
CHOOSE  OR  REQUEST  ANY  OTHER  VENUE.

SECTION  14.10     Notices.  Any notice, communication, request, instruction, or
other  document  required  or  permitted  hereunder  (including notices of Title
Defects  and  Environmental  Defects) shall be given in writing and delivered in
person or sent by U.S. Mail postage prepaid, return receipt requested, overnight
delivery  service,  electronically,  or facsimile to the addresses of Seller and
Buyer set forth below.  Any such notice shall be effective and deemed given only
upon  receipt.

          Seller:        J.M. HUBER CORPORATION
                         499 Thornal Street, 8th Floor
                         Edison, New Jersey  08837-2267
                         Attention:  Joseph M. Dunning
                         Vice President, Mergers & Acquisitions
                         Fax No.:  (732) 603-8103
                         Tel. No.:  (732) 603-3638
                         Email:  j.dunning@huber.com

<PAGE>
                         J.M. HUBER CORPORATION
                         1000 Parkwood Circle
                         Atlanta, Georgia  30339
                         Attention:
                         Vice President and General Counsel
                         (effective 1/1/11)
                         Fax No.:  (678) 247-7604
                         Tel. No.:  (678) 247-7304
                         Email:  carol.messer@huber.com

          Buyer:         HIGH PLAINS GAS, INC.
                         10318 Oak Creek Lane
                         Highland, Utah  84003
                         Attention:  Brent M. Cook
                         Fax No.:  (888) 879-0251
                         Tel. No.:  (801) 361-6490
                         Email:  brent.cook@highplainsgas.com

          With copy to:  HIGH PLAINS GAS, INC.
                         3601 Southern Drive
                         Gillette, Wyoming  82718
                         Attention:  Chief Executive Officer
                         Fax No.: (307) 685-5718
                         Tel. No.: (307) 686-5030
                         Email: brent.cook@highplainsgas.com

                         LONABAUGH AND RIGGS, LLP
                         P.O. Drawer 5059
                         Sheridan, Wyoming  82801
                         Attention: David C. Smith
                         Fax No.:  (307) 672-2230
                         Tel. No.:  (307) 672-7444
                         Email:  david@lonabaugh.com

Either  Party  may,  by  written notice delivered to the other Party, change its
address  for  notice  purposes  hereunder.

SECTION  14.11     Severability.  If  any  term  or  other  provision  of  this
Agreement is invalid, illegal, or incapable of being enforced by any rule of law
or  public  policy,  all other conditions and provisions of this Agreement shall
nevertheless  remain in full force and effect and the Parties shall negotiate in
good  faith  to  modify  this Agreement so as to effect their original intent as
closely  as  possible  in  an acceptable manner to the end that the transactions
contemplated  hereby  are  fulfilled  to  the  extent  possible.

<PAGE>
SECTION 14.12     Interpretation.  This Agreement shall be deemed and considered
for  all purposes to have been jointly prepared by the Parties, and shall not be
construed against any one Party (nor shall any inference or presumption be made)
on  the  basis of who drafted this Agreement or any particular provision hereof,
who  supplied  the  form  of  Agreement,  or any other event of the negotiation,
drafting, or execution of this Agreement.  Each Party agrees that this Agreement
has  been  purposefully  drawn  and  correctly reflects its understanding of the
transaction  that  it contemplates.  In construing this Agreement, the following
principles  will  apply:

(a)     A  defined  term  has  its defined meaning throughout this Agreement and
each  Exhibit  and  Schedule to this Agreement, regardless of whether it appears
before  or  after  the  place  where  it  is  defined.

(b)     If  there is any conflict or inconsistency between the provisions of the
main  body  of  this  Agreement  and  the  provisions of any Exhibit or Schedule
hereto, the provisions of this Agreement shall take precedence.  If there is any
conflict between the provisions of any Assignment or other transaction documents
attached  to  this  Agreement as an Exhibit and the provisions of any Assignment
and other transaction documents actually executed by the Parties, the provisions
of  the  executed Assignment and other executed transaction documents shall take
precedence.

(c)     Schedules  and  Exhibits  referred to herein are hereby incorporated and
made  a  part  of  this  Agreement  for  all  purposes  by  such  reference.

(d)     The omission of certain provisions of this Agreement from the Assignment
does  not  constitute a conflict or inconsistency between this Agreement and the
Assignment,  and  will  not  effect  a merger of the omitted provisions.  To the
fullest  extent  permitted  by Laws, all provisions of this Agreement are hereby
deemed  incorporated  into  the  Assignment  by  reference.

(e)     The  words  "includes"  and  "including"  and  their  derivatives  means
"includes,  but  not  limited  to"  or  "including,  but  not  limited  to," and
corresponding  derivative  meanings.

(f)     The  Article,  Section,  Exhibit,  and  Schedules  references  in  this
Agreement  refer  to  the  Articles,  Sections,  Exhibits, and Schedules of this
Agreement.  The  headings  and titles in this Agreement are for convenience only
and  shall  have no significance in interpreting or otherwise affect the meaning
of  this  Agreement.

(g)     The  terms "knowledge" or "knowingly,"  whether or not capitalized, with
regard  to  a Party shall mean the actual knowledge, without duty of inquiry, of
(i)  Joseph M. Dunning, Ralph W. Schofield, Jeffrey J. Ellena, Claud D. Riddles,
Jim  Frew, Everett Dalton and Ben White with respect of Seller and (ii) Brent M.
Cook,  Mark  D.  Hettinger,  Mark G. Skousen, Brandon W. Hargett and H.P. Gorham
with  respect  of  Buyer.

<PAGE>
(h)     The  adjective,  "material,"  whether  or  not capitalized, shall mean a
situation,  circumstance,  consequence,  or  concept  whose  relevance  to  the
transactions  contemplated  by this Agreement as a whole is of significance, and
would  not  be  considered  a small or insignificant deviation from the terms of
this  Agreement.

(i)     The  term  "Material  Adverse  Effect" shall mean any defect, condition,
change,  or  effect  (other  than  with  respect  to  which an adjustment to the
Purchase  Price  has  been  made)  that  when taken together with all other such
defects,  conditions,  changes,  and effects significantly diminishes the value,
use,  operations,  or  development  of  the  Assets,  taken  as  a  whole.
Notwithstanding  the  foregoing,  the  following  shall  not  be  considered  in
determining  whether  a  Material  Adverse  Effect  has  occurred:

     (i)  Fluctuations  in  commodity  prices;

     (ii)  Changes  in  Laws  or  Environmental  Laws;  or

     (iii)  Changes  in  the  oil  and  gas  industry  that  do  not  have  a
disproportionate  impact  on  the  ownership  and  operation  of  the  Assets.

(j)     "Breach"  shall mean any breach of, or any falsity or inaccuracy in, any
representation  or  warranty  or  any breach of, or failure to perform or comply
with, any covenant or obligation, in or of this Agreement or any other contract,
agreement,  or instrument contemplated by this Agreement or any event which with
the  passing  of  time or the giving or notice, of both, would constitute such a
breach,  inaccuracy,  or  failure;  provided  that  to constitute a Breach, such
breach,  inaccuracy, or failure must be material to the subject matter regarding
which  the  Breach  is  asserted.

(k)     "Tax"  means  all taxes and any other assessments, duties, fees, levies,
or other charges imposed by a Governmental Authority based on or measured by the
value  of  the  Assets,  the production of Hydrocarbons, the receipt of proceeds
with  respect to such Assets or Hydrocarbons, or otherwise related in any manner
or  attributable  to  the Assets or the production of Hydrocarbons including any
production tax, windfall profits tax, severance tax, personal property tax, real
property  tax,  or  ad valorem tax, together with any interest, fine, or penalty
thereon,  or  addition  thereto.

(l)     The  plural  shall  be  deemed  to include the singular, and vice versa.

SECTION  14.13     Conspicuousness.  THE  PARTIES  AGREE THAT PROVISIONS IN THIS
AGREEMENT  IN  "BOLD"  TYPE  SATISFY ANY REQUIREMENTS OF THE "EXPRESS NEGLIGENCE
RULE"  AND  OTHER REQUIREMENTS AT LAW OR EQUITY THAT PROVISIONS BE CONSPICUOUSLY
MARKED  OR  HIGHLIGHTED.

SECTION 14.14     Deceptive Trade Practices Waiver.  TO THE EXTENT APPLICABLE TO
THE TRANSACTION CONTEMPLATED HEREBY OR ANY PORTION THEREOF, BUYER WAIVES BUYER'S
RIGHTS

<PAGE>
UNDER  THE  PROVISIONS  OF  THE  TEXAS  DECEPTIVE  TRADE  PRACTICES  -  CONSUMER
PROTECTION ACT, SECTIONS 17.41 ET. SEQ. OF THE TEXAS BUSINESS AND COMMERCE CODE,
A  LAW  THAT  GIVES CONSUMERS SPECIAL RIGHTS AND PROTECTIONS, AND ANY COMPARABLE
ACT IN ANY OTHER STATE IN WHICH THE ASSETS ARE LOCATED; PROVIDED, HOWEVER, BUYER
DOES  NOT  WAIVE  SECTION 17.555 OF SUCH TEXAS STATUTE. BUYER STATES THAT, AFTER
CONSULTATION  WITH  AN ATTORNEY OF BUYER'S SELECTION, BUYER VOLUNTARILY CONSENTS
TO  THIS  WAIVER.  TO  EVIDENCE  BUYER'S  ABILITY  TO  GRANT  SUCH WAIVER, BUYER
REPRESENTS  TO SELLER THAT IT (a) IS IN THE BUSINESS OF SEEKING OR ACQUIRING, BY
PURCHASE  OR  LEASE,  GOODS  OR SERVICES FOR COMMERCIAL OR BUSINESS USE, (b) HAS
KNOWLEDGE  AND  EXPERIENCE  IN  FINANCIAL AND BUSINESS MATTERS THAT ENABLE IT TO
EVALUATE  THE  MERITS  AND RISKS OF THE TRANSACTIONS CONTEMPLATED HEREBY, (c) IS
NOT  IN  A  SIGNIFICANTLY  DISPARATE  BARGAINING POSITION, AND (d) HAS CONSULTED
WITH,  AND IS REPRESENTED BY, AN ATTORNEY OF BUYER'S OWN SELECTION IN CONNECTION
WITH  THIS  TRANSACTION,  AND  SUCH  ATTORNEY  WAS  NOT  DIRECTLY  OR INDIRECTLY
IDENTIFIED,  SUGGESTED,  OR  SELECTED  BY  SELLER  OR  AN  AGENT  OF  SELLER.

SECTION  14.15     Time  of  the  Essence.  Time  shall  be  of the essence with
respect  to  all  time  periods  and notice periods set forth in this Agreement.

SECTION  14.16     Counterpart Execution.  This Agreement may be executed in any
number  of  counterparts,  and  each counterpart hereof shall be effective as to
each Party that executes the same whether or not all of such Parties execute the
same counterpart.  If counterparts of this Agreement are executed, the signature
pages  from  various  counterparts may be combined into one composite instrument
for  all  purposes.  All  counterparts  together  shall  constitute  only  one
Agreement,  but  each counterpart shall be considered an original.  In the event
that this Agreement is delivered by facsimile transmission or by e-mail delivery
of  a  ".pdf"  format date file, such signature shall create a valid and binding
obligation  of  the  Party  executing  (or  on  whose  behalf  such signature is
executed)  with  the  same  force  and  effect  as  if  such facsimile or ".pdf"
signature  page  were  an  original  thereof.

To facilitate the execution and recording of the conveyance of the Assets from
Seller to Buyer, the Parties agree that they may execute multiple assignments
substantially in the form attached as Exhibit D which contain only that portion
of the Assets that are located in a particular county, and all such assignments
shall constitute a single conveyance of the Assets from Seller to Buyer.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

IN  WITNESS WHEREOF, Seller and Buyer have executed and delivered this Agreement
as  of  the  date  first  set  forth  above.

                                        SELLER:

                                        J.M. HUBER CORPORATION

                                        By:
                                        Name:
                                        Title:

                                        BUYER:

                                        HIGH PLAINS GAS, INC.

                                        By:
                                        Name:
                                        Title:

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