Document:

Unassociated Document

    FARMOUT
      AND AMI AGREEMENT

    

    GEARY
      PROSPECT

    NATRONA
      AND CONVERSE COUNTIES, WYOMING

    

    This
      Farmout and AMI Agreement (“Agreement”) dated and effective as of _____________,
      2008 (“Effective Date”), is made by and between TYLER
      ROCKIES EXPLORATION, LTD.
      (“FARMOR”), a Texas limited partnership, whose address is P.O. Box 119, Tyler,
      Texas 75710 and AMERIWEST
      ENERGY CORP.
      (“FARMEE”), a Nevada corporation authorized to do business within the State of
      Wyoming, whose address is 123 West 1st,
      Suite
      215, Casper, Wyoming 82601. FARMOR hereby agrees to assign to FARMEE all of
      FARMOR’S leasehold interest in and to certain leases, subject to the rights and
      reservations set out herein.

    

    I.
      FARMOUT AREA

    

    A. Lands
      and Leases. The
      “Farmout Area” is comprised of all of FARMOR’S present leasehold interest in and
      to the lands and oil and gas leases described on Exhibit “A-1” (“Leases”) and
      the area outlined and labeled as the “AMI” on the plat attached hereto as
      Exhibit “A-2”, insofar as said Leases cover oil or gas and all associated liquid
      or liquefiable hydrocarbons. To the extent any oil and gas leases within the
      AMI
      are obtained by either party under the provisions of Article X during the AMI
      Term, as defined in Article X, then subject to the terms of this Agreement,
      those oil and gas leases shall also be considered part of the Farmout Area
      and
      included as Leases.

    

    B. Renewals
      or Extensions of Leases. As
      long
      as this Agreement remains in force and effect as to all or any part of the
      Farmout Area, any new Lease or a renewal or extension of a Lease, whether
      acquired by FARMEE or by FARMOR, shall be subject hereto, the same as if such
      new, renewal or extension were described in Exhibit “A-1” and the lands covered
      thereby fell within the Farmout Area. Should any Lease covered by the Agreement
      contain greater burdens including, but not limited to, royalties, overriding
      royalties and production payments after obtaining a new Lease or being renewed
      or extended than it contained prior to said new, renewal or extension, then
      that
      portion of the burden on the new, renewed or extended Lease which is greater
      than the burden that existed prior to said new, renewal or extension (exclusive
      of the interests reserved by the parties hereunder) shall be borne entirely
      by
      the party creating it.

    

    II.
      FARMOUT WELLS

    

    A. Initial
      Well.
      On or
      before May 1, 2009 (“Spudding Deadline”), FARMEE shall commence or cause to be
      commenced the actual drilling (“spudding”) of a well, hereinafter called the
“Initial Well,” at a location of FARMEE’S choice within the Farmout Area. The
      location selected by FARMEE will be a legal location or an exception location
      approved by the governmental agency authorized to issue drilling permits.
      Subject to the provisions of this Agreement, in the event that FARMEE fails
      to
      timely commence the Initial Well and/or fails to drill said well to the Contract
      Depth, as defined below, then this Agreement shall automatically terminate,
      and
      FARMEE shall have no rights to earn any leasehold interest in and to the Farmout
      Area from FARMOR. 

     

    B. Contract
      Depth. The
      Initial Well shall be drilled in a good and workmanlike manner and with due
      diligence to at least the Dakota formation hereinafter called “Contract Depth”.
      Each Additional Well shall be drilled to the depth and formation selected by
      FARMEE in its sole discretion, but at such time as FARMEE has drilled a total
      of
      three (3) wells to at least the Contract Depth and regardless of whether said
      wells have been completed, then the assignment of fifty percent (50%) of
      FARMOR’S interest the Leases within the Farmout Area shall be conveyed to FARMEE
      as stated in Article IV.E.

    

    C. Additional
      Wells.
      Each
      well spudded after the Initial Well shall be referred to as an “Additional
      Well”. FARMEE may elect to drill Additional Wells at locations of FARMEE’S
      choice, but until the assignment of fifty percent (50%) of FARMOR’s interest in
      the Leases within the Farmout Area as stated in Article IV.E., each Additional
      Well must be spudded not later than one-hundred twenty (120) days after the
      rig
      release of the previous well. There shall be no requirement to attempt a
      completion of the Initial Well or any Additional Well. Failure of FARMEE to
      commence any wells hereunder as required shall not result in any penalty to
      FARMEE other than the termination of FARMEE’S right to earn additional interests
      in the Leases which have not been previously earned pursuant to this
      Agreement.

    

    D. Time
      Between Spudding and Completion/Abandonment.
      After
      timely spudding any well hereunder, FARMEE will proceed to drill said well
      in a
      workmanlike manner without cessation of operations until FARMEE completes a
      well
      capable of producing oil and/or gas in paying quantities or until FARMEE plugs
      and abandon the well within a reasonable time. For the purpose of calculating
      the number of days between wells, completion for any well hereunder shall be
      the
      date the drilling rig is released.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    E. Substitute
      Well.
      If,
      prior to reaching Contract Depth in any well which is being drilled pursuant
      to
      this Agreement, FARMEE encounters a formation or other physical condition in
      the
      well which renders further drilling impracticable, FARMEE may plug and abandon
      such well and spud another well, referred to herein as a Substitute Well. The
      Substitute Well shall be spudded at a location of FARMEE’S choice within 60 days
      after the date of abandonment (being the date the drilling rig is released)
      of
      the well for which it is a substitute. The Substitute Well shall be drilled
      subject to all provisions of this Agreement applicable to the abandoned well
      for
      which it is a substitute and reference to the Initial Well or Additional Wells
      shall include its Substitute Well, if any.

    

    F. Cost
      and Liabilities.
      Any
      well drilling operations conducted pursuant to this Agreement, including without
      limitation, drilling and completion or plugging and abandonment operations,
      by
      FARMEE shall be free of any costs or liability to FARMOR.

    

    G. Assignment
      of Drilling Location.
      Upon
      written request from FARMEE and if required by any state or federal governmental
      agency having jurisdiction over the granting of drilling permits, FARMOR agrees
      to assign to FARMEE those rights listed in Article IV, below, in the Leases
      covering a forty (40) acre drilling location. Such assignment shall be done
      so
      as to not cause FARMEE material delays in obtaining the drilling permit and
      of
      spudding a well hereunder. In the event FARMEE fails to earn an assignment
      pursuant to this Agreement for such well that FARMOR executed a drilling
      location assignment, then FARMEE agrees to reassign to FARMOR all rights
      previously assigned to it in that drilling location assignment, without creating
      any encumbrances or additional burdens thereon.

    

    H. Recognition
      of Force Majeure. The parties acknowledge that circumstances beyond the
      control of either party may limit or delay strict compliance with the deadlines
      established under this Article, and agree that the provisions of Article XII.,
      Force Majeure, may operate to supersede said deadlines. 

    

    III.
      WELL DATA, ACCESS TO RIG FLOOR, AND TITLE

    

    A. Tests.
      During
      the drilling of any well pursuant to this Agreement, FARMEE may test all oil
      and/or gas shows encountered in the formation FARMEE may earn its interest
      in
      accordance with appropriate operating practices. 

    

    B. Access
      to Rig Floor.
      FARMOR
      will have access, at its sole cost, risk and expense, to the rig floor in
      connection with wells drilled by FARMEE so long as FARMEE is not hindered in
      the
      performance of its operations and duties; provided that provisions of this
      Agreement pertaining to FARMEE’s compliance, indemnification, and insurance
      requirements shall not apply with regard to FARMOR’s access to the rig
      floor.

    

    C. Ownership
      of Data.
      All
      data, including without limitation test results, logs and cores, including
      those
      things contained in Exhibit “B” that are generated in the course of drilling,
      testing and completing wells hereunder by FARMEE will be furnished to FARMOR.
      All data furnished to FARMOR shall be treated as confidential, and FARMOR shall
      not disclose or transmit such data to third parties.

    

    D. Title. At
      the
      execution of this Agreement, FARMEE has remitted to FARMOR the sum of Fifty
      Thousand Dollars ($50,000.00), which reimburses FARMOR for the costs of
      conducting land brokerage services and title examination within the Farmout
      Area, the product of which is already in the possession of FARMEE to use in
      its
      performance of this Agreement. On FARMEE’S request, FARMOR will provide FARMEE
      with copies any additional title opinions and other title materials in its
      possession, custody or control to which FARMEE does not already possess. FARMOR
      will assume no responsibility for the accuracy of any such opinions and
      materials and FARMEE may rely on any abstracts and title materials furnished
      at
      FARMEE’S own risk. On FARMOR’S request, FARMEE will provide FARMOR with copies
      of all additional title opinions and curative materials pertaining to the
      Farmout Area that FARMEE obtains during this Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    IV.
      ASSIGNMENT OF INTERESTS

    

    A. Prerequisites
      to Assignment.
      Unless
      otherwise provided in Article II.G., above, or Article IV.E., FARMEE shall
      be
      entitled to an assignment on the form substantially identical to that which
      is
      contained in Exhibit “C”, attached hereto, which will be prepared by FARMOR and
      delivered to FARMEE within thirty (30) days after receipt of a request for
      same,
      conveying FARMOR’S leasehold interest in the Farmout Area as set forth in this
      Article IV upon:

    

    
      	 	
              (1)

            	
              FARMEE
                drilling to at least the Contract Depth and completing any well provided
                for herein as a well capable of producing oil and/or gas in paying
                quantities, and 

            

    

    

    (2) Creation
      of a production unit around any well provided for herein in accordance with
      Article IV.Q.

    

    B. Effective
      Date.
      The
      effective date of any assignment made hereunder shall be the date of spudding
      the well.

    

    C. No
      Warranty.
      Any
      assignment made hereunder shall be without warranty of title, express or
      implied, except by, through and under FARMOR, but not otherwise.

    

    D. Taxes.
      FARMEE
      shall pay all production, severance, and ad valorem taxes assessed against
      the
      Leases conveyed to FARMEE under this Agreement on and after the effective date
      of the assignment. Ad valorem taxes shall be prorated between the parties for
      the year in which the conveyance is effective and in the year of any
      re-assignment or reversion. Any increase in ad valorem taxes assessed against
      the Leases conveyed to FARMEE as a result of wells drilled hereunder shall
      be
      for FARMEE’S account.

     

    E. Oil
      and Gas Rights Assigned.
      Any
      assignment made hereunder shall convey all of the right, title and interest
      of
      FARMOR in the oil, gas, and associated liquid or liquefiable hydrocarbon rights,
      only, contained in those Leases comprising the Farmout Area, insofar as said
      Leases are contained within the surface boundaries of a production unit formed
      around the well (giving credit for any drilling location assignment made
      pursuant to Article II.G.) entitling FARMEE to said assignment, however, in
      the
      event FARMEE drills its third well to at least the Contract Depth, then at
      that
      time, FARMEE shall have earned, and FARMOR shall also immediately assign to
      FARMEE, an undivided fifty percent (50%) of FARMOR’S interest in all of the
      remaining Leases within the Farmout Area that have not previously been earned
      by
      FARMEE, without depth limitation. The assignments for the three wells shall
      be
      made by FARMOR on a well-by-well basis without depth limitation. 

    

    F. Reservation
      of Overriding Royalty.
      In any
      assignment made hereunder for units of each earning well, FARMOR will reserve
      an
      overriding royalty interest on that portion of the oil and gas, including
      condensate, produced and saved from or allocated to FARMOR’S interest in the
      Leases that is assigned to FARMEE, equal to the difference between 25% of 8/8ths
      and all payments out of production for which FARMOR is responsible as of the
      date of this Agreement (including but not limited to royalties, overriding
      royalties, and production payments). It is the intent hereof for FARMOR to
      deliver to FARMEE a 75% of 8/8ths net revenue interest in each Lease
      proportionately reduced to FARMOR’S interest in the Leases. Said overriding
      royalty shall be free and clear of all costs of exploring, drilling, producing,
      separating, compressing, gathering, transportation, treating and marketing,
      but
      shall bear its part of gross production taxes and ad valorem taxes. This
      overriding royalty shall be subject to the possibility of converting to a
      working interest as prescribed by Article IV.J., below. Notwithstanding anything
      contained herein to the contrary, FARMOR shall not receive or retain an
      overriding royalty interest by this provision for those Leases taken by FARMEE
      pursuant to Article XII.A., below.

    

    G.
       Proportionate
      Reduction.
      If
      FARMOR owns less than the entire undivided leasehold estate in the Leases or
      if
      FARMOR’S Leases cover less than the entire fee simple estate, whether or not
      such lease purports to cover the whole or fractional interest, then the
      interests reserved to FARMOR therein shall be proportionately reduced to accord
      with the interest assigned to FARMEE.

    

    H. New
      Leases and Lease Extensions and Renewals.
      FARMOR’S reserved overriding royalty and all other rights and interests allowed
      under this Agreement to be retained in any assignment made pursuant hereto,
      shall apply to any renewal, extension or new lease (if, in the case of a new
      lease, it is acquired to replace an expired Lease that had been previously
      included in this Agreement) of any Lease which is subject to this Agreement,
      whether taken or renewed in its entirety or in part, and which is acquired
      by
      FARMEE or on its behalf prior to or within one (1) year after the expiration,
      termination, release, or abandonment of said Lease, except to the extent that
      any expiration, termination, release or abandonment is caused by the acts or
      omissions of FARMOR. Should such a lease contain a greater burden (including
      but
      not limited to royalties, overriding royalties and production payments) after
      being taken a new, renewed or extended than it contained prior to said new,
      renewal or extension, that portion of the burden on the new, renewed or extended
      lease which is greater than the burden that existed on the date of this
      Agreement, exclusive of the interests reserved by FARMOR hereunder, shall be
      borne entirely by the party creating it. 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    I. Operating
      Agreement. Upon
      FARMEE earning an assignment from FARMOR, then the rights and obligations of
      the
      Parties for the earning well and the area so assigned for that earning well
      shall be governed by an Operating Agreement, the form of which is attached
      hereto as Exhibit “D”, except to the extent this Agreement modifies or amends
      the terms of such Operating Agreement. Separate,
      but identical, Operating Agreements shall govern for each well and its area
      assigned pursuant to this Agreement. FARMEE shall be designated the “Operator”
for each Operating Agreement created by this Agreement.

    

    J. Conversion
      of Overriding Royalty.
      In any
      assignment made hereunder, FARMOR will reserve the option, to be exercised
      at
      Payout on a well-by-well basis, as hereinafter defined, to convert its reserved
      overriding royalty to a 25% working interest at an 84.50% net revenue factor,
      being a 21.125 net revenue interest, in the leasehold estate assigned to FARMEE
      by FARMOR, subject to proportionate reduction, together with a like interest
      in
      the well which reached Payout, casing, surface equipment, and all personal
      property used in connection therewith that is attributable to said leasehold
      estate, free of any payments out of production created since the date of this
      Agreement (including but not limited to overriding royalties and production
      payments).

    

    K. Notification
      of Payout and Election.
      FARMEE
      shall notify FARMOR, in writing, when Payout is reached as to any well provided
      for herein and shall furnish FARMOR with all necessary reports evidencing
      Payout. FARMOR shall have thirty (30) days after receipt of such notification
      and reports to provide its written election to convert its overriding royalty.
      If FARMOR fails to timely notify FARMEE of its election, FARMOR shall be deemed
      to have elected to not
      convert
      its overriding royalty to a twenty-five percent (25%) working interest. A
      conversion election shall be effective as of 7:00 A.M. on the first day of
      the
      month following the month Payout occurs. Within forty-five (45) days after
      notification of FARMOR’S election to convert its overriding royalty to a working
      interest, FARMEE shall deliver to FARMOR an assignment and bill of sale, to
      evidence the conversion to a leasehold interest. If FARMOR elects to convert
      its
      overriding royalty interest to a leasehold interest, such interest will be
      subject to an Operating Agreement in the form attached hereto as Exhibit “D”,
      which will be conformed to identify the Contract Area, being the proration
      unit
      for said well.

    

    L. Payout.
      Payout
      shall be on a well-by-well basis and shall occur when the Net Proceeds, as
      hereinafter defined, from the sale of all production from the well which
      entitled FARMEE to the assigned lease premises equals the total tangible and
      intangible costs of drilling, equipping (an oil well through the oil storage
      tanks and a gas well through the point of sale), testing, completing, and
      operating said well, as such costs are attributable to the interest
      assigned.

    

    M. Net
      Proceeds.
“Net
      Proceeds” is defined as the gross proceeds received from the sale of production
      attributable to said Well or, if not sold but purchased or used by FARMEE off
      the premises, the market value in the field of such production, less severance,
      production, or other taxes payable on said production, shut-in royalties, and
      payments out of production (including but not limited to royalties, overriding
      royalties, and production payments) in effect on the effective date of this
      Agreement, and the overriding royalties reserved herein. Market value as used
      in
      this paragraph shall mean the price which a producer would reasonably expect
      to
      receive from a third party under a new sales contract entered into during the
      accounting period in which oil or gas was produced and purchased or used by
      FARMEE.

    

    N. Payout
      Period.
      The
      period during which the Net Proceeds are to be applied against the costs is
      called the “Payout Period”. Charges and expenditures during the Payout Period
      shall be made in accordance with the provisions in the Accounting Procedure
      attached hereto as part of Exhibit “D”. Nothing herein, or in said Accounting
      Procedure, shall be construed as constituting joint operations during said
      period. Well costs as referenced in Article IV.K., above, will not include
      FARMEE’S COPAS overhead charges or salaries of FARMEE’S employees. Within 90
      days after completion of any well provided for herein as a well capable of
      producing oil and/or gas in paying quantities, FARMEE shall furnish the
      cumulative costs of drilling, completing, and equipping said well as a producer.
      Quarterly thereafter during the Payout Period, FARMEE shall furnish reports
      showing operating expenses, production volumes, and proceeds from the sale
      of
      FARMEE’S share of production from the well for the preceding month.

    

    O. Audit.
      FARMOR
      shall have the right to audit FARMEE’S records pertaining to all costs of any
      well during drilling, Payout Period, and subsequent to Payout Period, in
      accordance with the audit provisions of the Accounting Procedure attached as
      part of Exhibit “D”.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    P. Second
      Well in Unit Prior to Payout of First Well.
      If
      FARMEE drills another well within a unit in which FARMEE by a prior well drilled
      and earned a portion of the Farmout Area, but which first well has not yet
      paid
      out, then FARMOR will retain in such other well an overriding royalty and the
      separate right to convert to a working interest at Payout in that other well,
      separate and a part from the well earning the Leases within that
      unit.

    

    Q. Proration
      Units. Subject
      to requirements of the state or federal governmental agencies, the shape of
      any
      production unit for any successfully completed well shall be mutually determined
      by FARMOR and FARMEE, but shall not exceed in area of 40 acres. FARMEE
      shall be solely responsible for obtaining any agreements that may be required
      from mineral and/or royalty owners for the formation of any units including
      such
      Leases, and that, to the extent that FARMEE fails to obtain such consents,
      FARMEE shall bear any additional burdens on production, and any other
      obligations or liabilities, resulting from such failure.

     

    R. Cooperation
      with Pooling and Unitization for Wells. 
      FARMEE
      has the ongoing right to pool or unitize any part of the land within the Farmout
      Area in order to establish production units for wells drilled hereunder with
      other lands or interests when in FARMEE’S judgment it is necessary or advisable
      in order to promote conservation, to properly develop or operate the land and
      interests for such wells. FARMOR agrees to cooperate in any such pooling and
      unitization within the Farmout Area, including the execution and delivery of
      documents necessary to effect said efforts.

     

    V.
      WELL TAKEOVER AND ABANDONMENT

    There
      is
      no Article V. Well Takeover and Abandonment provision.

    VI.
      LEASE OBLIGATIONS 

    

    A. Surface. FARMEE
      shall comply with all Lease provisions, express and implied by law pertaining
      to
      surface use, shall conduct its operations as would a reasonably prudent
      operator, and shall restore the surface to its original condition insofar as
      practicable, or as required by the applicable Lease provisions.

    

    B. Responsibility
      for Payments.
      

    

    (1) Delay
      Rentals Prior to Assignment.
      As long
      as this Agreement is in force, FARMOR shall use its best efforts to pay any
      rental payments necessary to perpetuate the Leases subject to this Agreement
      and
      any payments provided for in any lease subject hereto to renew or extend such
      lease. FARMEE agrees to promptly reimburse FARMOR for 100% of such rentals.
      FARMEE’S obligation to reimburse FARMOR for such payments shall continue so long
      as the lease for which payment is made is subject to the Agreement or assignment
      unless at least 45 days prior to the date such payment is due, FARMEE notifies
      FARMOR that FARMEE wishes to terminate the Agreement as to such lease or, if
      a
      lease has been assigned to FARMEE, that FARMEE wishes to reassign the lease
      to
      FARMOR.

    

    (2) Shut-in
      Payments Prior to Assignment.
      In the
      event it appears that FARMEE will complete a gas well and shut in that well
      which requires the payment of shut-in payments prior to an assignment being
      due
      to FARMOR, then FARMEE shall give FARMOR immediate notice that timely shut-in
      payments must be made. FARMOR shall then use its best efforts to pay any shut-in
      payments due prior to assignment that may be necessary to perpetuate the
      Leases.

    

    (3) Confirmation
      of Payment. Within
      fifteen (15) days from the request of FARMEE, FARMOR shall provide such
      documentation as is necessary to confirm timely payments by FARMOR.

    

    C. Royalties
      and Other Lease Burdens. FARMEE
      shall be responsible for making all payments out of production attributable
      to
      the assigned lease premises, including but not limited to royalties, overriding
      royalties, and production payments, beginning with the date of first production
      from any well drilled on the assigned lease premises or land pooled therewith
      and at all times thereafter. Such payments shall be made in accordance with
      the
      Leases or other instruments creating such payments and obligations, including
      this Agreement.

    

    VII.
      COMPLIANCE AND INDEMNITY

    

    A. Disposal
      of Wastes and Cleanup. FARMEE
      shall dispose of or discharge any waste from its operations (including but
      not
      limited to produced water, drilling fluids and other associated wastes) in
      accordance with applicable local, state and federal laws, rules, and
      regulations. To the extent required by law or by prudent oil field operation,
      FARMEE shall keep records of the types, amounts and location of wastes that
      are
      disposed of onsite and those wastes relating to its operations hereunder that
      are disposed of offsite. When and if any Lease or an interest therein which
      is
      earned and assigned in accordance with this Agreement is terminated, FARMEE
      shall take whatever remedial action on the property is necessary to meet any
      local, state, or federal requirements directed at protecting human health and
      the environment at that time.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    B. Compliance
      with Laws, Release, and Indemnity

     

    (1) FARMEE
      SHALL COMPLY WITH ALL VALID LOCAL, STATE AND FEDERAL LAWS, RULES AND
      REGULATIONS, INCLUDING BUT NOT LIMITED TO THOSE DIRECTED AT PROTECTING HUMAN
      HEALTH AND THE ENVIRONMENT, SUCH AS (BY WAY OF EXAMPLE AND NOT LIMITATION AND
      INCLUDING ALL AMENDMENTS) THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION
      AND LIABILITY ACT OF 1980, THE RESOURCE CONSERVATION AND RECOVERY ACT OF 1976,
      THE CLEAN WATER ACT, THE SAFE DRINKING WATER ACT, THE HAZARDOUS MATERIALS
      TRANSPORTATION ACT, THE TOXIC SUBSTANCES CONTROL ACT, AND THE CLEAN AIR
      ACT.

     

    (2) FARMEE
      ACKNOWLEDGES THAT THE LAND SUBJECT TO THIS AGREEMENT MAY HAVE BEEN USED FOR
      OIL
      AND GAS OPERATIONS IN THE PAST. FARMEE AGREES THAT ANY CONVEYANCE OF INTERESTS
      HEREUNDER SHALL BE ON AN "AS IS" BASIS.

     

    (3) FARMEE
      SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD FARMOR HARMLESS FROM ANY AND ALL
      DAMAGES, EXPENSES (INCLUDING COURT COSTS AND ATTORNEY'S FEES), CIVIL FINES,
      PENALTIES AND OTHER COSTS AND LIABILITIES (HEREINAFTER COLLECTIVELY REFERRED
      TO
      AS "CLAIMS") ARISING, ASSERTED, COMMENCED OR MADE ON OR AFTER THE EFFECTIVE
      DATE
      OF THIS AGREEMENT THAT RESULT FROM FARMEE’S ACTS AND OMISSIONS (OR THOSE OF
      OTHER PARTIES ON YOUR BEHALF) IN CARRYING OUT OPERATIONS UNDER THIS AGREEMENT
      AND/OR ON LEASES CONVEYED UNDER THIS AGREEMENT. THE ABOVE CLAIMS SHALL INCLUDE,
      BUT NOT BE LIMITED TO, THOSE ASSERTED OR BROUGHT BY ANY PARTY (INCLUDING,
      WITHOUT LIMITATION, FARMEE’S OR FARMOR’S, CONTRACTORS, ANY LANDOWNERS OR
      INDIVIDUALS, LOCAL, STATE OR FEDERAL GOVERNMENTAL BODY OR AGENCY) FOR DEATH,
      PERSONAL INJURY, DAMAGE TO PROPERTY OR NATURAL RESOURCES, AND/OR FAILURE TO
      COMPLY WITH THE EXPRESS OR IMPLIED TERMS OF A MINERAL LEASE. SUCH CLAIMS SHALL
      ALSO INCLUDE ANY THAT ARISE OUT OF THE PLUGGING AND ABANDONING OR FAILURE TO
      PLUG AND ABANDON ANY WELLS ON OR IN LANDS COVERED HEREBY (WHETHER PLUGGED AND
      ABANDONED PRIOR TO OR AFTER THE EFFECTIVE DATE OF THIS AGREEMENT) OR ARISING
      OUT
      OF THE REMOVAL OF OR FAILURE TO REMOVE ANY PIPELINE OR OTHER FACILITIES, OR
      ON
      ACCOUNT OF THE PRESENCE, DISPOSAL, AND/OR RELEASE OF ANY MATERIAL OF ANY KIND
      IN, ON OR UNDER THE LANDS COVERED HEREBY (WHETHER OR NOT SUCH MATERIAL WAS
      PRESENT PRIOR TO THE EFFECTIVE DATE OF THIS AGREEMENT). 

     

    THE
      TERMS OF THIS PROVISION (3) SHALL APPLY NOTWITHSTANDING THE STRICT LIABILITY,
      JOINT NEGLIGENCE OR FAULT OF FARMOR OR ANY PARTY OR PARTIES. THE PROVISIONS
      SET
      FORTH IN THIS ARTICLE VII. SHALL SURVIVE TERMINATION OF THIS
      AGREEMENT.

     

    VIII.
      FAILURE TO PERFORM

    

    A. Operations.
      In
      addition to the rights granted to FARMOR in other provisions of this Agreement,
      in the event of FARMEE’S failure to commence or complete the drilling of the
      Initial Well or any Additional Well in the time and manner herein provided,
      this
      Agreement shall terminate as to all of the Farmout Area not previously earned
      by
      FARMEE; however, FARMEE shall continue to be responsible for all obligations
      accrued by FARMEE prior to such default.

    

    B. Notice
      of Termination.
      FARMOR
      will give FARMEE written notice of termination, however in the event FARMEE
      fails to commence the drilling of the Initial Well or any Additional Well,
      termination will occur automatically and no such notice will be required to
      effectuate the termination of FARMEE’S rights under this
      Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    IX.
      INSURANCE AND FINANCIAL RESPONSIBILITY

    

    Prior
      to
      the commencement of any drilling operations on the Farmout Area, and for as
      long
      as this Agreement remains in effect, FARMEE shall, at its own expense, provide
      and maintain in force the following insurance covering its interest in the
      Farmout Area:

    

    (1) Worker’s
      Compensation Insurance and Employer’s Liability Insurance as may be required by
      the laws of the state deemed by law to govern operations hereunder;
      and

    

    (2) Comprehensive
      General Liability Insurance covering both bodily injury liability and property
      liability with a Combined Single Limit of $500,000 for each occurrence;
      and

    

    (3) Comprehensive
      Automobile Public Liability and Property Damage Insurance with a combined single
      limit of $500,000 for each occurrence; and

    

    (4) Catastrophe
      Comprehensive Liability Insurance with minimum limits of not less than
      $1,000,000.

    

    X.
      AMI

    

    A. AMI. By
      this
      Agreement, the parties hereby create an area of mutual interest (“AMI”) being
      the same area and depths as the Farmout Area, whereby the Parties shall jointly
      develop the Leases pursuant to this Agreement. The provisions of Article II,
      above, control the parties’ actions related to FARMEE drilling and earning
      interests held by FARMOR as of the Effective Date within the Farmout Area and
      the AMI. The terms of this Article X shall apply during the AMI Term to those
      matters between the parties relating to leased areas of the Farmout Area other
      than those earned by FARMEE as drilling occurs pursuant to Article
      II.

    

    (i)
      FARMEE is designated as ”Operator” of the AMI, and it shall be responsible for
      seeing that leasing and exploration activities in the AMI are conducted. In
      discharging its duties as Operator of the AMI, FARMEE shall have the same
      liability to FARMOR as it does being the Operator of each Operating Agreement.
      

    

    (ii)
      FARMEE shall have the sole and exclusive right as between the parties to acquire
      directly or indirectly any lease from third-parties within the AMI; provided
      however, that in the event FARMOR does acquire a lease from a third-party within
      the AMI during the AMI Term, then FARMEE shall have the right to acquire and
      be
      assigned its proportionate share of such lease from FARMOR at the same cost
      and/or terms as FARMOR acquired the Lease under the same terms, deadlines and
      costs as described in Paragraph X.A(iii) below but by substituting FARMOR for
      FARMEE. 

    

    (iii) During
      the AMI Term, if FARMEE acquires a Lease within the AMI that is not either
      (1)
      within an established unit for an earning well under Article II, above, or
      (2)
      outside of a unit established for a well to which the parties have previously
      made an election to drill, then FARMEE shall notify FARMOR within thirty (30)
      days of such acquisition. 

    

    (a) For
      all
      leases acquired by FARMEE from third-parties within the AMI during the AMI
      Term,
      FARMEE shall be responsible for paying all of the lease bonuses up to $500
      for
      each net mineral acre so acquired. FARMOR shall be responsible for paying its
      50% working interest share for all lease bonuses that exceed $500 per net
      mineral acre. FARMOR and FARMEE shall share equally in all other out-of-pocket
      expenses incurred in leasing under this AMI provision. In such notice, FARMEE
      shall include all pertinent information about the interest so acquired,
      including written documentation as may be reasonably requested by FARMOR. For
      a
      period of fifteen (15) days from receipt of the notice, FARMOR shall the right,
      but not obligation, to advise in writing FARMEE that it wishes to acquire an
      undivided fifty percent (50%) interest in such lease, and at that same time,
      remit its share of the acquisition costs for such Lease. 

    

    (b) In
      the
      event of the failure by FARMEE to receive FARMOR’S written notice and
      reimbursement of acquisition costs of such Lease within fifteen (15) days from
      receipt of such notice, it shall be deemed that FARMOR has declined to receive
      its proportionate share of such Lease. If FARMOR declines or is deemed to have
      declined to acquire its proportionate share of a Lease under this provision,
      then that Lease shall be excluded from this Agreement for all purposes, and
      FARMEE shall be free to participate in any future wells with such rights
      separate and a part from this Agreement. 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c) Within
      thirty (30) days after FARMEE’S receipt of FARMOR’S timely written notice and
      share of acquisition costs, then FARMEE shall execute and deliver to FARMOR
      the
      appropriate assignment, without covenants of warranty, except by, through and
      under FARMEE. 

    

    (d) If
      FARMEE
      acquires any Lease within a unit established for a well to be drilled or has
      been drilled pursuant to Article II, above, then the Lease shall be considered
      as a Lease which may be earned by FARMEE as to FARMOR’S purchased fifty percent
      (50%) interest in such Lease. 

    

    C. AMI
      Term. The
      term
      of this AMI provision shall commence upon the Effective Date of this Agreement,
      and it shall continue for so long
      as
      FARMEE has the right to earn Leases under Article II, above. Upon either the
      termination of FARMEE’S right to earn Leases or performance by FARMEE resulting
      in the conveyance of all remaining Leases as provided in Article IV.E., the
      AMI
      provision contained in each Operating Agreement covering any portion of the
      Farmout Area then existing shall become effective. Each such Operating Agreement
      will be considered a separate agreement covering the Contract Area for each
      such
      agreement. If there are any Leases subject to this Agreement lying outside
      Contract Areas on the date of termination, a separate Operating Agreement will
      be deemed to be in effect to govern such Leases on a tract-by-tract basis within
      the Farmout Area. The termination of this AMI provision shall not affect any
      unsatisfied obligations any Party may have hereunder to another Party that
      arose
      prior to the termination date.

    

    

    D. Wold
      Acreage.
      Notwithstanding anything to the contrary herein, with regard to the the tract
      of
      land described as T.34N., R.77W. of the 6th
      P.M.:
      Sec. 28: N/2SE/4; Sec. 27: SW/4, W/2SE/4 (referred to as the “Wold Acreage”),
      FARMOR shall not be entitled to receive any interest that FARMEE may receive
      pursuant to a third party farmout agreement within the Wold Acreage for the
      first two (2) earning wells and their respective units pursuant to that
      agreement. However, FARMOR shall be entitled to receive from FARMEE an
      assignment of one-half (1/2) of the leasehold interest FARMEE may be assigned
      from the third party farmor for those Wold Acreage lands and leases which are
      outside of the units of the first two (2) wells drilled under that third party
      farmout.

    

    XI.
      ASSIGNMENT OF AGREEMENT

    

    This
      Agreement is binding upon the parties hereto, their successors, and assigns;
      and
      assignment of this Agreement shall not be made by FARMEE without prior written
      notice to FARMOR, subject to the requirement that any proposed third party
      assignee shall be financially responsible in the sole discretion of FARMOR.
      Any
      such assignment shall provide that the assignee will assume the proper and
      timely performance of all of FARMEE’S obligations hereunder. Any assignment that
      is not in compliance with the terms of this paragraph shall be null and void.
      Consent by FARMOR to any such assignment shall not relieve FARMEE nor any
      assignee from the rights and obligations as to any future assignment or from
      the
      timely and proper performance of any of FARMEE’S obligations hereunder, except
      with the written consent of FARMOR. If FARMEE assigns this Agreement, it shall
      assign all of its rights in this Agreement. 

    

    XII.
      FORCE MAJEURE

    

    A. Except
      for the duty to make payments hereunder when due, and the indemnification
      provisions under this Agreement, neither FARMOR nor FARMEE shall be responsible
      to the other for any delay, damage or failure caused by or occasioned by a
      Force
      Majeure Event. As used in this Agreement, “Force Majeure Event” includes: acts
      of God, action of the elements, warlike action, insurrection, revolution or
      civil strife, piracy, civil war or hostile action, strikes, differences with
      workers, acts of public enemies, federal or state laws, rules and regulations
      of
      any governmental authorities having jurisdiction in the premises or of any
      other
      group, organization or informal association (whether or not formally recognized
      as a government); inability to procure material, equipment or necessary labor
      in
      the open market, acute and unusual labor or material or equipment shortages,
      or
      any other causes (except financial) beyond the control of either party. Delays
      due to the above causes, or any of them, shall not be deemed to be a breach
      of
      or failure to perform under this contract. Neither FARMOR nor FARMEE shall
      be
      required against its will to adjust any labor or similar disputes except in
      accordance with applicable law.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    B. Neither
      party that is unable, in whole or part, to carry out its obligations under
      this
      Agreement due to Force Majeure Event shall promptly give written notice to
      that
      effect to the other party stating in reasonable detail the circumstances
      underlying such Force Majeure Event. Any party calling Force Majeure Event
      shall
      diligently use reasonable efforts to remove the cause of such Force Majeure
      Event, and shall resume performance of any suspended obligations as soon as
      reasonably possible after termination of such Force Majeure Event.

    

    XIII.
      GENERAL PROVISIONS

    

    A. Relationship
      of Parties.
      It is
      not the purpose or intention of this Agreement to create, nor shall the same
      be
      construed as creating any mining partnership, or partnership relation, nor
      shall
      the operations of the parties hereunder be construed to be considered as a
      joint
      venture. The liability of the parties hereto shall be several and not joint
      or
      collective.

    

    B. Resolution
      of Disputes:
      The
      parties hereby stipulate and agree that all claims, controversies, and disputes
      (LESS AND EXCEPT THOSE CLAIMS WHICH ARE CRIMINAL IN NATURE) between FARMOR
      and
      FARMEE which are incident to, arise out of, or in any way connected with this
      Agreement and/or the performance or breach of this Agreement shall be resolved
      promptly, practically, fairly and as economically as reasonably practical.
      Therefore, FARMOR and FARMEE hereby stipulate and agree that any and all claims,
      controversies and disputes, as well as all disagreements regarding any
      interpretation or application of this Agreement between said parties, shall
      be
      resolved pursuant to the procedures contained this provision of the Agreement.
      

    

    (i)
      Either party may send a notice of dispute to the other party, which notice
      shall
      clearly state the issue which the sending party has with the other party. Within
      twenty-one (21) days from the receipt of such notice, the parties’ senior
      management or representatives thereof shall meet to try to resolve the issue.
      If
      the parties cannot resolve the dispute through meetings with senior management
      or their representatives within sixty (60) days from the first meeting, then
      either party shall have the right to request binding arbitration.

    

    (ii) Subject
      to any modifications set forth in a written agreement executed by the parties,
      binding arbitration shall be conducted in accordance with the following general
      rules and guidelines:

    

    (a) Arbitration
      may be initiated by either FARMOR or FARMEE, or jointly.

    

    (b) Such
      arbitration shall be submitted to and conducted by the Denver, Colorado regional
      office of the American Arbitration Association in accordance with its Commercial
      Arbitration Rules in effect at that time.

    

    (c) Except
      as
      provided below, a single qualified, independent and neutral arbitrator shall
      be
      chosen by the parties to the arbitration in accordance with the applicable
      procedures of the American Arbitration Association.

    

    (d) All
      motions filed of a judicial nature, in connection with the arbitration, shall
      be
      filed only in the State Courts of Natrona County, Wyoming.

    

    (e) All
      such
      arbitrations shall apply the substantive and procedural laws of the State of
      Wyoming.

    

    (f) The
      arbitrator(s) shall be required to commence the actual hearing of the dispute
      within sixty (60) days from the date the arbitrator has been chosen and agreed
      to serve. The arbitrator(s) shall provide all parties to such arbitration with
      a
      copy of the arbitrator’s written decision or award within thirty (30) days of
      the conclusion of the arbitration proceedings. Such decision or award shall
      be
      conclusive, final and binding on all parties to such arbitration and no party
      may appeal such decision or award.

    

    (g) The
      arbitrator’s decision shall include assessment of the actual costs and expenses
      of the parties, including reasonable and necessary attorney’s fees, and shall be
      enforceable in any Court of competent jurisdiction. However, the costs for
      the
      arbitrator’s fees shall be borne equally between the FARMOR and FARMEE, and each
      party shall be responsible for its payments to the arbitrator directly. All
      other costs and expenses shall be borne by the party who incurred
      them.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (h) The
      arbitrator shall not award or assess any punitive, exemplary, indirect or
      consequential damages in connection with such arbitration.

    

    (i) Each
      party hereto shall be limited to that discovery (written and by oral deposition)
      reasonably necessary to adequately develop the case of each party. No party
      to
      such arbitration shall request or conduct more than four (4) depositions and
      four (4) requests for admissions and/or the production of documents prior to
      the
      actual arbitration hearing.

    

    (k) All
      matters concerning the conduct of the arbitrator(s) shall be governed by the
      provisions of the American Arbitration Association.

    

    (l) In
      the
      event the claim, controversy, or dispute involves or reasonably could be
      anticipated to involve an amount in excess of Five Hundred Thousand Dollars
      ($500,000.00) (excluding attorney fees and arbitration related costs), then
      any
      party to such arbitration may elect for such arbitration to be heard, conducted
      and decided by a panel of three (3) qualified, independent and neutral
      arbitrators instead of a single arbitrator, and such panel shall be chosen
      by
      the parties to the arbitration in accordance with the applicable procedures
      of
      the American Arbitration Association. In the event of a dispute between the
      FARMOR and the FARMEE as to the amount in dispute or which reasonably could
      be
      anticipated to be in dispute, the FARMOR and the FARMEE agree that the first
      arbitrator chosen by such parties shall conclusively make a determination in
      regard to the amount involved or reasonably anticipated to be involved in such
      dispute, thereby determining whether or not such arbitration shall be conducted
      by a single arbitrator or by a panel of three (3) arbitrators.

    

    C Severability.
      In the
      event any provision in this Agreement is determined to be invalid by a court
      of
      law, such determination shall not operate to invalidate any other provision
      contained herein and said Agreement shall otherwise remain in full force and
      effect according to its terms.

    

    D. Headings.
      The
      underlined headings in this Agreement are used for convenience and shall not
      be
      considered in construing this Agreement.

    

    E. Exhibits.
      The
      exhibits referred to in this Agreement are attached hereto and made a part
      hereof. Should any provision of an exhibit attached hereto conflict with the
      provisions of this Agreement, this Agreement will prevail to the extent of
      the
      conflict.

    

    F. Previous
      Communications.
      This
      Agreement supersedes and replaces any prior oral or written communications,
      agreements or understandings between the Parties related to the subject matter
      of this Agreement. 

    

    G. Amendments.
      This
      Agreement shall not be modified except by written instrument executed by the
      parties hereto or their successors and assigns.

    

    H. No
      Waiver of Rights.
      The
      failure of either party to exercise any right granted hereunder shall not be
      deemed as a waiver of such party's privilege to exercise such right at any
      time
      or times.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    I.  Forward
      Looking Statements. The
      parties are including the following cautionary statement in this Agreement
      to
      make applicable and take advantage of the safe harbor provisions of the Private
      Securities Litigation Reform Act of 1995 for any forward-looking statements
      made
      by, or on behalf of any party hereto. Forward-looking statements include but
      are
      not limited to, statements concerning plans, objectives, goals, strategies,
      future events or performance and underlying assumptions and other statements,
      which are other than historical facts. The statements in this Agreement, as
      well
      as any oral statements and written materials provided by any party to the other
      parties before or after the execution of this Agreement including, but not
      limited to, production performance, recoverable reserves, projected revenues,
      expenses, net income and expected drilling and development activities, etc.
      are
      forward-looking statements. Certain statements contained herein as well as
      any
      oral statements and written materials provided by any party to the other parties
      before or after the execution of this Agreement, including but not limited
      to
      those statements which are identified by language that speaks of future events
      such as “may”, “could”, “believe”, “expect”, “intend”, “anticipate”, “estimate”,
“continue”, “projected”, “future”, “will”, “seek”, and “plan”, are inherently
      uncertain, and actual results or outcomes could differ materially from those
      expressed in these forward-looking statements. Important factors that could
      cause actual results to differ materially from those expressed in
      forward-looking statements, include but are not limited to state and federal
      regulatory development and statutory changes; the timing and extent of changes
      in commodity prices and markets; the timing and extent of success in acquiring
      leasehold interests and in discovering, developing, or acquiring oil and gas
      reserves; significant changes from expectations in actual capital expenditures
      and operating expenses and unanticipated delays or changes in costs; the nature
      and projected profitability of pending and potential prospects and other
      investments; uncertainty of oil and gas reserves estimates, etc. Furthermore,
      such forward-looking statements speak only as of the date of this Agreement,
      and
      no party accepts or agrees to undertake any obligation to update any such
      statement(s) to reflect the occurrence of new information, future events, or
      otherwise.

    

    J. Counterpart
      Execution.
      This
      Agreement may be executed in any number of counterparts, each of
      which
      shall be considered an original for all purposes and shall be binding on the
      party or parties executing same, notwithstanding the lack of execution of same
      by all parties hereto.

    

    [EXECUTIONS
      ON FOLLOWING PAGE]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	 
	
              FARMOUT
                AND AMI AGREEMENT

            
	
              GEARY
                PROSPECT

            
	
              NATRONA
                AND CONVERSE COUNTIES, WYOMING

            
	 
	
              EXECUTION
                PAGE 

            
	 
	 
	
              IN
                WITNESS HEREOF, this Agreement is executed by the Parties as of the
                Effective Date.

            
	 
	 
	
              TYLER
                ROCKIES EXPLORATION, LTD.

            
	 
	
              By:__________________________

            
	
              Name:_______________________

            
	
              Its:__________________________

            
	 
	 
	 
	
              AMERIWEST
                ENERGY CORP.

            
	 
	
              By:_________________________

            
	
              Name:_______________________

            
	
              Its:__________________________

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
              EXHIBIT
                A-1

            
	 
	
              LANDS
                AND LEASES OF FARMOUT AREA AS OF THE EFFECTIVE
                DATE

            
	 
	 
	
              LANDS:

            
	 
	
              Township
                34 North, Range 77 West, of the 6th
                P.M., Natrona and Converse Counties, Wyoming:

            
	 
	
              Sec:

            
	
              16:     S/2S/2
                

            
	
              17:     SW/4,
                S/2SE/4

            
	
              20:     All

            
	
              21:     All

            
	
              22:     SW/4,
                SE/4

            
	
              26:     SW/4

            
	
              27:     W/2,
                E/2

            
	
              28:     N/2,
                SE/4

            
	
              34:     NW/4,
                NE/4

            
	
              35:     NW/4

            
	 
	 
	
              Leases:SECURITIES
      PURCHASE AGREEMENT

    

    THIS
      SECURITIES PURCHASE AGREEMENT, dated August 25, 2008 (the “Agreement”), by and
      between FUTURE NOW GROUP, INC. (the “Company” or “Seller”), a Nevada
      corporation, having an address at 61 Unquowa Rd, Fairfield, CT 06824 and Alan
      Hall, an individual having an address at ________________ (the “Buyer” or
“Investor”).

    

    WHEREAS,
      the Seller desires to sell 555,556 shares of the Company’s Common Stock (the
“Common Stock”) and issued common stock purchase warrants (the “Warrants”) to
      the Buyer and the Buyer desires to purchase said Common Stock and Warrants;
      

    

    WHEREAS,
      both the Buyer and the Seller desire to set forth in this Agreement all of
      the
      terms and provisions that will govern this transaction and their legal rights
      hereunder; and

    

    NOW,
      THEREFORE, in consideration of the mutual promises made by each party to the
      other, and for other good and valuable consideration more particularly defined
      below, it is agreed as follows:

    

    1.
       Purchase
      and Sale.
      The
      Seller hereby sells and the Buyer hereby purchases 555,556 newly issued Common
      Stock of the Company. The consideration for the Common Stock to be issued to
      the
      Buyer includes the payment of $100,000 representing a purchase price of $0.18
      per share (whether by check or wire transfer, in either case, in immediately
      available funds). In addition to the 555,556 shares, upon receipt of the
      purchase price of $100,000 as provided herein, the Seller shall also issue
      Warrants to purchase 277,778 shares of Common Stock. The Warrants expire five
      years from their issuance date and shall have an exercise price of $036 The
      Form
      of Warrant is provided under Exhibit A hereto. 

     

    The
      Common Stock and Warrants of the Company being bought and sold pursuant to
      this
      Agreement, are sometimes hereinafter referred to as the “Security” or
“Securities”. The entire purchase price is due and payable upon the execution
      and delivery of this Agreement, and shall be paid by certified check, or by
      wire
      transfer in immediately available funds, made payable to the order of the
      Seller. Simultaneous with the execution and delivery of this Agreement and
      upon
      receipt of the purchase price therefore in readily available fund, the Seller
      shall cause the certificates representing the Securities, together with fully
      executed and duly endorsed stock powers, to be delivered to Buyer, Buyer’s
      designated agent or to the Company’s transfer agent, as the Buyer shall
      authorize and instruct. The date on which the Seller shall receive the purchase
      price and the Buyer shall receive the Securities and all other conditions to
      closing shall have occurred or been duly waived shall constitute the “Closing
      Date.”

    

    2.   Representations
      of the Seller.
      In
      connection with the issuance of the Common Stock, the Company herein, warrants
      and represents to the Buyer that, as of the Closing Date:

    

    2.1 Issuance
      of Common Stock.
      When
      issued hereunder, the Common Stock will be validly issued, fully paid and
      non-assessable, and free and clear of all liens, encumbrances, and restrictions
      on transfer or preemptive rights, charges and claims of every kind.

    

    2.2 Organization
      and Authority of the Company; Subsidiaries.
      The
      Company is a corporation duly organized, validly existing and in corporate
      good
      standing under the laws of the State of Nevada, and has the requisite power
      and
      authority to own all of its properties and assets and to carry on its business
      as it is now being conducted. 

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    2.3 Authorization.
      The
      Company has taken or will take all corporate action required to make all the
      obligations of the Company reflected in the provisions of this Agreement. Except
      as otherwise indicated in the preceding sentence, the issuance of the Common
      Stock will not require any further corporate action and will not be subject
      to
      preemptive rights of any present or future stockholders of the Company which
      have not been waived in writing. This Agreement constitutes the valid and
      binding obligation of the Company, enforceable in accordance with its terms,
      except as enforcement hereof may be limited by bankruptcy, insolvency,
      moratorium or other similar laws relating to or affecting the rights of
      creditors generally and subject to the fact that equitable remedies are
      discretionary and may not be granted by a court of competent
      jurisdiction.

     

    2.4 No
      Default.
      The
      execution, delivery and performance of this Agreement, the Common Stock of
      the
      Company and the consummation by the Company of the transactions contemplated
      hereby do not and will not constitute a default under any of the terms,
      conditions or provisions of the Certificate of Incorporation or By Laws of
      the
      Company, each as amended or restated as of the date hereof, or any material
      contract, agreement or arrangement to which the Company is a party or by which
      it is bound.

     

    2.5 Capital
      Stock of Company.
      The
      authorized capital stock of the Company consists of 900,000,000 shares of Common
      Stock, 50,000,000 shares of Preferred Stock, both $.001 par value per share,
      of
      which 77,963,953
      Common
      Stock and no Preferred Stock shares are currently issued and outstanding. All
      of
      the current outstanding shares of capital stock of the Company have been duly
      authorized, are validly issued and are fully paid and non assessable. Refer
      to
      the Company’s regulatory filings for the fully diluted ownership
      profile.

     

    2.6 Compliance
      with Laws.
      The
      Company holds all material licenses, approvals, certificates, permits and
      authorizations necessary for the lawful conduct of its business and is in
      material compliance with all applicable federal, state and local laws, rules,
      regulations and ordinances. The Company has all franchises, permits, licenses,
      and any similar authority necessary for the conduct of its business, the lack
      of
      which could materially and adversely affect the business, properties, prospects
      or financial condition of the Company. The Company is not in default in any
      material respect under any such franchise, permit, license or other similar
      authority.

     

    2.7 Litigation.
      There
      is no action, suit, proceeding at law or in equity, arbitration or
      administrative or other proceeding by or before (or to the best knowledge,
      information and belief of the Company any investigation by) any governmental
      or
      other instrumentality or agency, pending, or, to the Company’s knowledge,
      information and belief, threatened against or affecting the Company, or any
      of
      its properties or rights which could materially and adversely affect the right
      or ability of the Company to carry on its business as now conducted, or which
      could materially and adversely affect the condition, whether financial or
      otherwise, or properties of the Company.

     

    2.8 Intellectual
      Property.
      The
      Company’s intellectual property rights (“IP Rights”) are sufficient to carry on
      the business of the Company as presently conducted or contemplated. The Company
      has exclusive ownership of or exclusive license to use all of its IP Rights
      and
      it has obtained any licenses, releases or assignments necessary to use all
      third
      parties’ intellectual property rights in works embodied in its products or
      services and material to the conduct of its business. The Company has taken
      all
      reasonable measures to protect and preserve the security, confidentiality and
      value of its IP Rights. Neither the present nor contemplated business
      activities, IP Rights or products of the Company infringe upon or misappropriate
      any rights to the intellectual property of any third party. The Company has
      not
      received any notice or other claim from any person asserting that any of the
      Company’s present or contemplated activities or IP Rights infringe,
      misappropriates or may infringe or misappropriate any rights to a third party's
      intellectual property. The Company is not aware of any infringement by or
      misappropriation of others of its IP Rights in any of its products, technology
      or services, or any violation of the confidentiality of any of its proprietary
      information. To the Company’s knowledge, the Company is not making unlawful or
      unauthorized use of any intellectual property of any past or present employees
      or consultants of the Company. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    2.9 No
      Material Omissions.
      Neither
      this Agreement, the Common Stock, nor any information document or certificate
      furnished to the Buyer by or on behalf of the Company contains any untrue
      statement of a material fact, and none of this Agreement, or such other
      documents and certificates omits to state a material fact necessary in order
      to
      make the statements contained herein or therein not misleading. 

     

    3.    Representations
      of the Buyer.
      The
      Buyer, in order to induce the Seller to enter into this Agreement and consummate
      the purchase contemplated herein, warrants and represents to the Seller as
      follows:

    

    (a) That,
      except as may be expressly set forth in this Agreement, the Seller has made
      no
      representations or warranties to the Buyer, written or oral, upon which the
      Buyer is relying in order to consummate the purchase of the Securities under
      this Agreement.

    

    (b) The
      Buyer
      acknowledges that the Buyer has independently investigated the Company's
      business, financial conditions, current state of affairs, planned business
      and
      other matters necessary in order for the Buyer to make an informed decision
      to
      purchase of the Securities.

    

    (c) The
      Buyer
      represents that the funds provided for this purchase are either separate
      property of the Buyer, other property over which the Buyer has the right of
      control, or are otherwise funds as to which the Buyer has the sole right of
      management. 

    

    (d) This
      Agreement and all representations, warranties and statements made herein are
      true, complete and correct in all material respects.

    

    (e) This
      Agreement is a legally binding obligation of the Buyer in accordance with its
      terms.

    

    (f) The
      Buyer
      hereby expressly represents to the Seller that Buyer has relied upon his/her
      own
      legal counsel, accountant and other professionals to advise him/her in
      connection with the purchase of the Securities and consummation of the
      transactions contemplated under this Agreement.

    

    (g) The
      Buyer recognizes
      that the purchase of Securities involves a high degree of risk and is suitable
      only for persons of adequate financial means who have no need for liquidity
      in
      this investment in that (i) the Buyer may not be able to liquidate the
      investment in the event of an emergency; (ii) transferability is limited; and
      (iii) in the event of a disposition, the Buyer could sustain a complete loss
      of
      the entire investment.

     

    (h) Limitations
      on Disposition. The
      Buyer
      understands that there are substantial restrictions on the transferability
      of
      the Securities pursuant to the Securities Act; the Securities will not be,
      and
      the Buyer has no right to require that the Securities be registered under the
      Securities Act; and, accordingly, the Buyer may have to hold the Securities
      for
      an indefinite period of time or until the Securities have been registered by
      the
      Company or are subject to an exemption from registration. The Buyer represents
      that the Buyer can afford to hold the Securities for an indefinite period of
      time. The Buyer further understands that an opinion of counsel and other
      documents may be required to transfer the Securities. The Buyer acknowledges
      that the Securities shall bear the following, or a substantially similar,
      legend:

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    "THE
      SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
      STATE SECURITIES LAWS AND NEITHER SUCH SHARES NOR ANY INTEREST THEREIN MAY
      BE
      OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A
      REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES
      ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) IN ACCORDANCE WITH THE
      PROVISIONS OF REGULATION S, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION
      UNDER THE SECURITIES ACT."

    

    (i) Absence
      of Official Evaluation. The
      Buyer
      understands that no federal or state agency has made any finding or
      determination as to the fairness of the terms of an investment in the Company,
      or any recommendation for or endorsement of the Securities sold
      hereby.

     

    (j) Additional
      Financing.
      The
      Buyer further acknowledges that nothing hereunder shall preclude the Company
      from seeking and/or procuring additional equity and/or debt
      financing.

     

    (k) Authority
      to Enter into Agreement. The
      Buyer
      has the full right, power, and authority to execute and deliver this Agreement
      and perform the Buyer's obligations hereunder.

     

    (l) Entity
      as a Subscriber.
      If the
      Buyer is a corporation, partnership, trust, or other entity, (i) the Buyer
      is
      authorized and qualified to become a shareholder of, and is authorized to,
      make
      its investment in the Company; (ii) the Buyer has not been formed for the
      purpose of acquiring an interest in the Company; (iii) the Buyer has not been
      in
      existence for less than 90 days prior to the date hereof; and (iv) the person
      signing this Agreement on behalf of such entity has been duly authorized by
      such
      entity to do so. 

     

    (m) Prohibitions
      on Cancellation, Termination, Revocation, Transferability, and Assignment.
      The
      Buyer
      hereby acknowledges and agrees that, except as may be specifically provided
      herein or by applicable law, the Buyer is not entitled to cancel, terminate,
      or
      revoke this Agreement, and this Agreement shall survive the Buyer's death or
      disability or any assignment of the Securities. The Buyer further agrees that
      the Buyer may not transfer or assign the Buyer's rights under this Agreement,
      

     

    (n) Obligation.
      This
      Agreement constitutes a valid and legally binding obligation of the Buyer and
      neither the execution of this Agreement nor the consummation of the transactions
      contemplated herein will constitute a violation of or default under, or conflict
      with, any judgment, decree, statutes or regulation of any governmental authority
      applicable to the Buyer, or any contract, commitment, agreement, or restriction
      of any kind to which the Buyer is a party or by which the Buyer's assets are
      bound. The execution and delivery of this Agreement does not, and the
      consummation of the transactions described herein will not, violate applicable
      laws, or any mortgage, lien, agreement, indenture, lease or understanding
      (whether oral or written) of any kind outstanding relative to the
      Buyer.

     

    (q) Required
      Approvals.
      No
      approval, authorization, consent, order, or other action of, or filing with,
      any
      person, firm or corporation or any court, administrative agency or other
      governmental authority is required in connection with the execution and delivery
      of this Agreement by the Buyer or the purchase of the Securities.

     

    (r) No
      General Solicitation.
      The
      Buyer is not buying the Securities because of or following any advertisement,
      article, notice, or other communication published in any newspaper, magazine
      or
      similar media or broadcast over television or radio, or presented at any seminar
      or meeting, or any solicitation or a subscription by a person other than an
      authorized representative of the Company.

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    5. Miscellaneous
      Provisions. 

    

    (a) Entire
      Agreement. This Agreement sets forth the entire understanding of the parties
      in
      connection with the transactions described herein and supersedes any and all
      prior oral or written contracts, agreements or understandings between the
      parties. 

    

    (b) Modification
      – Amendment. This Agreement may not be changed, modified, extended, terminated
      or discharged orally, but only by an agreement in writing, which is signed
      by
      all of the parties to this Agreement.

    

    (c) Further
      Assurances. The parties agree to execute any and all such other and further
      instruments and documents, and to take any and all such further actions
      reasonably required to effectuate this Agreement and the intent and purposes
      hereof.

    

    (d) Governing
      Law. This Agreement shall be governed by and construed in accordance with the
      laws of the State of Nevada.

    

    (e) No
      Assignment. Neither this Agreement nor any of the rights of the Buyer hereunder
      may be transferred or assigned by the Buyer.

     

    (Signatures
      follow on next page)

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      the
      Buyer and the Seller have executed this Agreement as of the day, month and
      year
      first above written. 

    

      
        	
                SELLER:

              
	 
	
                FUTURE
                  NOW GROUP, INC.

              
	 
	 	 	 
	 	
                (Signature)

              	 
	 	 	 
	 	
                (Print
                  Name)

              	 
	 	 	 
	 	
                (Title)

              	 
	 
	
                BUYER:

              	 	 
	 	 	 
	 	 	 
	 	
                (Signature)

              	 
	 	 	 
	 	
                (Print
                  Name)

              	 
	 	 	 
	 	
                (Title)

              	 

      

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    Exhibit
      A to Common Stock and Warrant Purchase Agreement:

    Form
      of Warrant Agreement

    

    COMMON
      STOCK PURCHASE WARRANT

    

    To
      Purchase 277,778 Shares of Common Stock of

     

    FUTURE
      NOW GROUP INC.

     

    THIS
      COMMON STOCK PURCHASE WARRANT (the “Warrant”)
      certifies that, for value received, Alan Hall (the “Holder”),
      is
      entitled, upon the terms and subject to the limitations on exercise and the
      conditions hereinafter set forth, at any time on or after the date hereof (the
      “Initial
      Exercise Date”)
      and on
      or prior to the close of business on the five year anniversary of the Initial
      Exercise Date (the “Termination
      Date”)
      but
      not thereafter, to subscribe for and purchase from Future Now Group Inc., a
      Nevada corporation (the “Company”),
      up to
      277,778 shares (the “Warrant
      Shares”)
      of
      Common Stock, par value $.001 per share, of the Company (the “Common
      Stock”).
      The
      purchase price of one share of Common Stock under this Warrant shall be equal
      to
      the Exercise Price, as defined in Section 2(b).

    

    Section
      1. Definitions.
      As
      capitalized within the document.

    

    Section
      2. Exercise.

    

    a) Exercise
      of Warrant.
      Subject
      to compliance with the terms and condition of this Warrant, exercise of the
      purchase rights represented by this Warrant may be made, in whole or in part,
      at
      any time or times on or after the Initial Exercise Date and on or before the
      Termination Date by delivery to the Company of a duly executed facsimile copy
      of
      the Notice of Exercise Form annexed hereto (or such other office or agency
      of
      the Company as it may designate by notice in writing to the registered Holder
      at
      the address of such Holder appearing on the books of the Company); provided,
      however,
      within
      5 Trading Days of the date said Notice of Exercise is delivered to the Company,
      the Holder shall have surrendered this Warrant to the Company and the Company
      shall have received payment of the aggregate Exercise Price of the shares
      thereby purchased by wire transfer.

     

    b) Exercise
      Price.
      The
      exercise price of the Common Stock under this Warrant shall be $0.36,
      subject to adjustment hereunder (the “Exercise
      Price”).

     

    c) Mechanics
      of Exercise.
      

     

    i. Authorization
      of Warrant Shares.
      The
      Company covenants that all Warrant Shares which may be issued upon the exercise
      of the purchase rights represented by this Warrant will, upon exercise of the
      purchase rights represented by this Warrant, be duly authorized, validly issued,
      fully paid and nonassessable and free from all taxes, liens and charges in
      respect of the issue thereof (other than taxes in respect of any transfer
      occurring contemporaneously with such issue). 

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    ii. Delivery
      of Certificates Upon Exercise.
      Certificates for shares purchased hereunder shall be transmitted by the transfer
      agent of the Company to the Holder by crediting the account of the Holder’s
      prime broker with the Depository Trust Company through its Deposit Withdrawal
      Agent Commission (“DWAC”)
      system
      if the Company is a participant in such system, and otherwise by physical
      delivery to the address specified by the Holder in the Notice of Exercise within
      3 Trading Days from the delivery to the Company of the Notice of Exercise Form,
      surrender of this Warrant and payment of the aggregate Exercise Price as set
      forth above (“Warrant
      Share Delivery Date”).
      This
      Warrant shall be deemed to have been exercised on the date the Exercise Price
      is
      received by the Company. The Warrant Shares shall be deemed to have been issued,
      and Holder or any other person so designated to be named therein shall be deemed
      to have become a holder of record of such shares for all purposes, as of the
      date the Warrant has been exercised by payment to the Company of the Exercise
      Price and all taxes required to be paid by the Holder, if any, pursuant to
      Section 2(c)(vii) prior to the issuance of such shares, have been paid.

     

    iii. Delivery
      of New Warrants Upon Exercise.
      If this
      Warrant shall have been exercised in part, the Company shall, at the time of
      delivery of the certificate or certificates representing Warrant Shares, deliver
      to Holder a new Warrant evidencing the rights of Holder to purchase the
      unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
      in all other respects be identical with this Warrant.

     

    iv. Rescission
      Rights.
      If the
      Company fails to cause its transfer agent to transmit to the Holder a
      certificate or certificates representing the Warrant Shares pursuant to this
      Section 2(c)(iv) by the Warrant Share Delivery Date, then the Holder will have
      the right to rescind such exercise.

     

    v. Compensation
      for Buy-In on Failure to Timely Deliver Certificates Upon
      Exercise.
      In
      addition to any other rights available to the Holder, if the Company fails
      to
      cause its transfer agent to transmit to the Holder a certificate or certificates
      representing the Warrant Shares pursuant to an exercise on or before the Warrant
      Share Delivery Date, and if after such date the Holder is required by its broker
      to purchase (in an open market transaction or otherwise) shares of Common Stock
      to deliver in satisfaction of a sale by the Holder of the Warrant Shares which
      the Holder anticipated receiving upon such exercise (a “Buy-In”),
      then
      the Company shall (1) pay in cash to the Holder the amount by which (x) the
      Holder’s total purchase price (including brokerage commissions, if any) for the
      shares of Common Stock so purchased exceeds (y) the amount obtained by
      multiplying (A) the number of Warrant Shares that the Company was required
      to
      deliver to the Holder in connection with the exercise at issue times (B) the
      price at which the sell order giving rise to such purchase obligation was
      executed, and (2) at the option of the Holder, either reinstate the portion
      of
      the Warrant and equivalent number of Warrant Shares for which such exercise
      was
      not honored or deliver to the Holder the number of shares of Common Stock that
      would have been issued had the Company timely complied with its exercise and
      delivery obligations hereunder. For example, if the Holder purchases Common
      Stock having a total purchase price of $11,000 to cover a Buy-In with respect
      to
      an attempted exercise of shares of Common Stock with an aggregate sale price
      giving rise to such purchase obligation of $10,000, under clause (1) of the
      immediately preceding sentence the Company shall be required to pay the Holder
      $1,000. The Holder shall provide the Company written notice indicating the
      amounts payable to the Holder in respect of the Buy-In, together with applicable
      confirmations and other evidence reasonably requested by the Company. Nothing
      herein shall limit a Holder’s right to pursue any other remedies available to it
      hereunder, at law or in equity including, without limitation, a decree of
      specific performance and/or injunctive relief with respect to the Company’s
      failure to timely deliver certificates representing shares of Common Stock
      upon
      exercise of the Warrant as required pursuant to the terms hereof.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    vi. No
      Fractional Shares or Scrip.
      No
      fractional shares or scrip representing fractional shares shall be issued upon
      the exercise of this Warrant. As to any fraction of a share which Holder would
      otherwise be entitled to purchase upon such exercise, the Company shall pay
      a
      cash adjustment in respect of such final fraction in an amount equal to such
      fraction multiplied by the Exercise Price.

     

    vii. Charges,
      Taxes and Expenses.
      Issuance of certificates for Warrant Shares shall be made without charge to
      the
      Holder for any issue or transfer tax or other incidental expense in respect
      of
      the issuance of such certificate, all of which taxes and expenses shall be
      paid
      by the Company, and such certificates shall be issued in the name of the Holder
      or in such name or names as may be directed by the Holder; provided,
      however,
      that in
      the event certificates for Warrant Shares are to be issued in a name other
      than
      the name of the Holder, this Warrant when surrendered for exercise shall be
      accompanied by the Assignment Form attached hereto duly executed by the Holder;
      and the Company may require, as a condition thereto, the payment of a sum
      sufficient to reimburse it for any transfer tax incidental thereto.

     

    viii. Closing
      of Books.
      The
      Company will not close its stockholder books or records in any manner which
      prevents the timely exercise of this Warrant, pursuant to the terms
      hereof.

     

    Section
      3. Certain Adjustments.

    

    a) Stock
      Dividends and Splits.
      If the
      Company, at any time while this Warrant is outstanding: (A) pays a stock
      dividend or otherwise make a distribution or distributions on shares of its
      Common Stock or any other equity or equity equivalent securities payable in
      shares of Common Stock (which, for avoidance of doubt, shall not include any
      shares of Common Stock issued by the Company pursuant to this Warrant), (B)
      subdivides outstanding shares of Common Stock into a larger number of shares,
      (C) combines (including by way of reverse stock split) outstanding shares of
      Common Stock into a smaller number of shares, or (D) issues by reclassification
      of shares of the Common Stock any shares of capital stock of the Company, then
      in each case the Exercise Price shall be multiplied by a fraction of which
      the
      numerator shall be the number of shares of Common Stock (excluding treasury
      shares, if any) outstanding immediately before such event and of which the
      denominator shall be the number of shares of Common Stock outstanding
      immediately after such event and the number of shares issuable upon exercise
      of
      this Warrant shall be proportionately adjusted. Any adjustment made pursuant
      to
      this Section 3(a) shall become effective immediately after the record date
      for
      the determination of stockholders entitled to receive such dividend or
      distribution and shall become effective immediately after the effective date
      in
      the case of a subdivision, combination or re-classification.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    b) Pro
      Rata Distributions.
      If the
      Company, at any time prior to the Termination Date, shall distribute to all
      holders of Common Stock (and not to Holders of the Warrants) evidences of its
      indebtedness or assets (including cash and cash dividends) or rights or warrants
      to subscribe for or purchase any security other than the Common Stock (which
      shall be subject to Section 3(b)), then in each such case the Exercise Price
      shall be adjusted by multiplying the Exercise Price in effect immediately prior
      to the record date fixed for determination of stockholders entitled to receive
      such distribution by a fraction of which the denominator shall be the VWAP
      determined as of the record date mentioned above, and of which the numerator
      shall be such VWAP on such record date less the then per share fair market
      value
      at such record date of the portion of such assets or evidence of indebtedness
      so
      distributed applicable to one outstanding share of the Common Stock as
      determined by the Board of Directors in good faith. In either case the
      adjustments shall be described in a statement provided to the Holder of the
      portion of assets or evidences of indebtedness so distributed or such
      subscription rights applicable to one share of Common Stock. Such adjustment
      shall be made whenever any such distribution is made and shall become effective
      immediately after the record date mentioned above.

     

    c) Fundamental
      Transaction.
      If, at
      any time while this Warrant is outstanding, (A) the Company effects any merger
      or consolidation of the Company with or into another Person, (B) the Company
      effects any sale of all or substantially all of its assets in one or a series
      of
      related transactions, (C) any tender offer or exchange offer (whether by the
      Company or another Person) is completed pursuant to which holders of Common
      Stock are permitted to tender or exchange their shares for other securities,
      cash or property, or (D) the Company effects any reclassification of the Common
      Stock or any compulsory share exchange pursuant to which the Common Stock is
      effectively converted into or exchanged for other securities, cash or property
      (in any such case, a “Fundamental
      Transaction”),
      then,
      upon any subsequent exercise of this Warrant, the Holder shall have the right
      to
      receive, for each Warrant Share that would have been issuable upon such exercise
      immediately prior to the occurrence of such Fundamental Transaction, at the
      option of the Holder, (a) upon exercise of this Warrant, the number of shares
      of
      Common Stock of the successor or acquiring corporation or of the Company, if
      it
      is the surviving corporation, and any additional consideration (the
“Alternate
      Consideration”)
      receivable upon or as a result of such reorganization, reclassification, merger,
      consolidation or disposition of assets by a Holder of the number of shares
      of
      Common Stock for which this Warrant is exercisable immediately prior to such
      event or (b) if the Company is acquired in an all cash transaction, cash equal
      to the value of this Warrant as determined in accordance with the Black-Scholes
      option pricing formula. For purposes of any such exercise, the determination
      of
      the Exercise Price shall be appropriately adjusted to apply to such Alternate
      Consideration based on the amount of Alternate Consideration issuable in respect
      of one share of Common Stock in such Fundamental Transaction, and the Company
      shall apportion the Exercise Price among the Alternate Consideration in a
      reasonable manner reflecting the relative value of any different components
      of
      the Alternate Consideration. If holders of Common Stock are given any choice
      as
      to the securities, cash or property to be received in a Fundamental Transaction,
      then the Holder shall be given the same choice as to the Alternate Consideration
      it receives upon any exercise of this Warrant following such Fundamental
      Transaction. To the extent necessary to effectuate the foregoing provisions,
      any
      successor to the Company or surviving entity in such Fundamental Transaction
      shall issue to the Holder a new warrant consistent with the foregoing provisions
      and evidencing the Holder’s right to exercise such warrant into Alternate
      Consideration. The terms of any agreement pursuant to which a Fundamental
      Transaction is effected shall include terms requiring any such successor or
      surviving entity to comply with the provisions of this Section 3(d) and insuring
      that this Warrant (or any such replacement security) will be similarly adjusted
      upon any subsequent transaction analogous to a Fundamental
      Transaction.

     

    d) Calculations.
      All
      calculations under this Section 3 shall be made to the nearest cent or the
      nearest 1/100th of a share, as the case may be. For purposes of this Section
      3,
      the number of shares of Common Stock deemed to be issued and outstanding as
      of a
      given date shall be the sum of the number of shares of Common Stock (excluding
      treasury shares, if any) issued and outstanding.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    e) Voluntary
      Adjustment By Company.
      The
      Company may at any time during the term of this Warrant reduce the then current
      Exercise Price to any amount and for any period of time deemed appropriate
      by
      the Board of Directors of the Company.

     

    f) Notice
      to Holders.
      

     

    i. Adjustment
      to Exercise Price.
      Whenever the Exercise Price is adjusted pursuant to this Section 3, the Company
      shall promptly mail to each Holder a notice setting forth the Exercise Price
      after such adjustment and setting forth a brief statement of the facts requiring
      such adjustment. If the Company issues a variable rate security, despite the
      prohibition thereon in the Purchase Agreement, the Company shall be deemed
      to
      have issued Common Stock or Common Stock Equivalents at the lowest possible
      conversion or exercise price at which such securities may be converted or
      exercised in the case of a Variable Rate Transaction (as defined in the Purchase
      Agreement).

     

    ii. Notice
      to Allow Exercise by Holder.
      If (A)
      the Company shall declare a dividend (or any other distribution) on the Common
      Stock; (B) the Company shall declare a special nonrecurring cash dividend on
      or
      a redemption of the Common Stock; (C) the Company shall authorize the granting
      to all holders of the Common Stock rights or warrants to subscribe for or
      purchase any shares of capital stock of any class or of any rights; (D) the
      approval of any stockholders of the Company shall be required in connection
      with
      any reclassification of the Common Stock, any consolidation or merger to which
      the Company is a party, any sale or transfer of all or substantially all of
      the
      assets of the Company, of any compulsory share exchange whereby the Common
      Stock
      is converted into other securities, cash or property; (E) the Company shall
      authorize the voluntary or involuntary dissolution, liquidation or winding
      up of
      the affairs of the Company; then, in each case, the Company shall cause to
      be
      mailed to the Holder at its last address as it shall appear upon the Warrant
      Register of the Company, at least 20 calendar days prior to the applicable
      record or effective date hereinafter specified, a notice stating (x) the date
      on
      which a record is to be taken for the purpose of such dividend, distribution,
      redemption, rights or warrants, or if a record is not to be taken, the date
      as
      of which the holders of the Common Stock of record to be entitled to such
      dividend, distributions, redemption, rights or warrants are to be determined
      or
      (y) the date on which such reclassification, consolidation, merger, sale,
      transfer or share exchange is expected to become effective or close, and the
      date as of which it is expected that holders of the Common Stock of record
      shall
      be entitled to exchange their shares of the Common Stock for securities, cash
      or
      other property deliverable upon such reclassification, consolidation, merger,
      sale, transfer or share exchange; provided,
      that
      the failure to mail such notice or any defect therein or in the mailing thereof
      shall not affect the validity of the corporate action required to be specified
      in such notice. The Holder is entitled to exercise this Warrant during the
      20-day period commencing on the date of such notice to the effective date of
      the
      event triggering such notice.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Section
      4. Transfer
      of Warrant.

    

    a) Transferability.
      Subject
      to compliance with any applicable securities laws and the conditions set forth
      in this Warrant and to the relevant provisions of the Purchase Agreement, this
      Warrant and all rights hereunder are transferable, in whole or in part, upon
      surrender of this Warrant at the principal office of the Company, together
      with
      a written assignment of this Warrant substantially in the form attached hereto
      duly executed by the Holder or its agent or attorney and funds sufficient to
      pay
      any transfer taxes payable upon the making of such transfer. Upon such surrender
      and, if required, such payment, the Company shall execute and deliver a new
      Warrant or Warrants in the name of the assignee or assignees and in the
      denomination or denominations specified in such instrument of assignment, and
      shall issue to the assignor a new Warrant evidencing the portion of this Warrant
      not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if
      properly assigned, may be exercised by a new holder for the purchase of Warrant
      Shares without having a new Warrant issued. 

     

    b) New
      Warrants.
      This
      Warrant may be divided or combined with other Warrants upon presentation hereof
      at the aforesaid office of the Company, together with a written notice
      specifying the names and denominations in which new Warrants are to be issued,
      signed by the Holder or its agent or attorney. Subject to compliance with
      Section 4(a), as to any transfer which may be involved in such division or
      combination, the Company shall execute and deliver a new Warrant or Warrants
      in
      exchange for the Warrant or Warrants to be divided or combined in accordance
      with such notice.

     

    c) Warrant
      Register.
      The
      Company shall register this Warrant, upon records to be maintained by the
      Company for that purpose (the “Warrant
      Register”),
      in
      the name of the record Holder hereof from time to time. The Company may deem
      and
      treat the registered Holder of this Warrant as the absolute owner hereof for
      the
      purpose of any exercise hereof or any distribution to the Holder, and for all
      other purposes, absent actual notice to the contrary.

     

    d) Transfer
      Restrictions.
      If,
      at the
time
      of
      the surrender of this Warrant in connection with any transfer of this Warrant,
      the transfer of this Warrant shall not be registered pursuant to an effective
      registration
      statement under the Securities Act
      and
under
      applicable state securities or blue sky laws, the Company may require, as a
      condition of allowing such transfer (i) that the Holder or transferee of this
      Warrant, as the case may be, furnish to the Company a written opinion of counsel
      (which opinion shall be in form, substance and scope customary for opinions
      of
      counsel in comparable transactions) to the effect that such transfer may be
      made
      without
      registration under
      the
      Securities Act and under applicable state securities or blue sky laws, (ii)
      that
      the holder or transferee execute and deliver to the Company an investment letter
      in form and substance acceptable to the Company and (iii) that the transferee
      be
      an “accredited
      investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7), or (a)(8)
      promulgated under the Securities Act or a qualified institutional buyer as
      defined in Rule 144A(a) under the Securities Act.

     

    Section
      5. Miscellaneous.

    

    a) Title
      to Warrant.
      Prior
      to the Termination Date and subject to compliance with applicable laws and
      Section 4 of this Warrant, this Warrant and all rights hereunder are
      transferable, in whole or in part, at the office or agency of the Company by
      the
      Holder in person or by duly authorized attorney, upon surrender of this Warrant
      together with the Assignment Form annexed hereto properly endorsed. The
      transferee shall sign an investment letter in form and substance reasonably
      satisfactory to the Company.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    b) No
      Rights as Shareholder Until Exercise.
      This
      Warrant does not entitle the Holder to any voting rights or other rights as
      a
      shareholder of the Company prior to the exercise hereof. Upon the surrender
      of
      this Warrant and the payment of the aggregate Exercise Price (or by means of
      a
      cashless exercise), the Warrant Shares so purchased shall be and be deemed
      to be
      issued to such Holder as the record owner of such shares as of the close of
      business on the later of the date of such surrender or payment.

     

    c) Loss,
      Theft, Destruction or Mutilation of Warrant.
      The
      Company covenants that upon receipt by the Company of evidence reasonably
      satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
      or any stock certificate relating to the Warrant Shares, and in case of loss,
      theft or destruction, of indemnity or security reasonably satisfactory to it
      (which, in the case of the Warrant, shall not include the posting of any bond),
      and upon surrender and cancellation of such Warrant or stock certificate, if
      mutilated, the Company will make and deliver a new Warrant or stock certificate
      of like tenor and dated as of such cancellation, in lieu of such Warrant or
      stock certificate.

     

    d) Saturdays,
      Sundays, Holidays, etc.
      If the
      last or appointed day for the taking of any action or the expiration of any
      right required or granted herein shall be a Saturday, Sunday or a legal holiday,
      then such action may be taken or such right may be exercised on the next
      succeeding day not a Saturday, Sunday or legal holiday.

     

    e) Authorized
      Shares.
      

     

    The
      Company covenants that during the period the Warrant is outstanding, it will
      reserve from its authorized and unissued Common Stock a sufficient number of
      shares to provide for the issuance of the Warrant Shares upon the exercise
      of
      any purchase rights under this Warrant. The Company further covenants that
      its
      issuance of this Warrant shall constitute full authority to its officers who
      are
      charged with the duty of executing stock certificates to execute and issue
      the
      necessary certificates for the Warrant Shares upon the exercise of the purchase
      rights under this Warrant. The Company will take all such reasonable action
      as
      may be necessary to assure that such Warrant Shares may be issued as provided
      herein without violation of any applicable law or regulation, or of any
      requirements of the Trading Market upon which the Common Stock may be listed.
      

    

    Except
      and to the extent as waived or consented to by the Holder, the Company shall
      not
      by any action, including, without limitation, amending its certificate of
      incorporation or through any reorganization, transfer of assets, consolidation,
      merger, dissolution, issue or sale of securities or any other voluntary action,
      avoid or seek to avoid the observance or performance of any of the terms of
      this
      Warrant, but will at all times in good faith assist in the carrying out of
      all
      such terms and in the taking of all such actions as may be necessary or
      appropriate to protect the rights of Holder as set forth in this Warrant against
      impairment. Without limiting the generality of the foregoing, the Company will
      (a) not increase the par value of any Warrant Shares above the amount payable
      therefor upon such exercise immediately prior to such increase in par value,
      (b)
      take all such action as may be necessary or appropriate in order that the
      Company may validly and legally issue fully paid and nonassessable Warrant
      Shares upon the exercise of this Warrant, and (c) use commercially reasonable
      efforts to obtain all such authorizations, exemptions or consents from any
      public regulatory body having jurisdiction thereof as may be necessary to enable
      the Company to perform its obligations under this Warrant.

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    Before
      taking any action which would result in an adjustment in the number of Warrant
      Shares for which this Warrant is exercisable or in the Exercise Price, the
      Company shall obtain all such authorizations or exemptions thereof, or consents
      thereto, as may be necessary from any public regulatory body or bodies having
      jurisdiction thereof.

    

    f) Jurisdiction.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Warrant shall be determined in accordance with the provisions of the
      Purchase Agreement.

     

    g) Restrictions.
      The
      Holder acknowledges that the Warrant Shares acquired upon the exercise of this
      Warrant, if not registered, will have restrictions upon resale imposed by state
      and federal securities laws.

     

    h) Nonwaiver
      and Expenses.
      No
      course of dealing or any delay or failure to exercise any right hereunder on
      the
      part of Holder shall operate as a waiver of such right or otherwise prejudice
      Holder’s rights, powers or remedies, notwithstanding the fact that all rights
      hereunder terminate on the Termination Date. If the Company willfully and
      knowingly fails to comply with any provision of this Warrant, which results
      in
      any material damages to the Holder, the Company shall pay to Holder such amounts
      as shall be sufficient to cover any costs and expenses including, but not
      limited to, reasonable attorneys’ fees, including those of appellate
      proceedings, incurred by Holder in collecting any amounts due pursuant hereto
      or
      in otherwise enforcing any of its rights, powers or remedies
      hereunder.

     

    i) Notices.
      Any
      notice, request or other document required or permitted to be given or delivered
      to the Holder by the Company shall be delivered in accordance with the notice
      provisions of the Purchase Agreement.

     

    j) Limitation
      of Liability.
      No
      provision hereof, in the absence of any affirmative action by Holder to exercise
      this Warrant or purchase Warrant Shares, and no enumeration herein of the rights
      or privileges of Holder, shall give rise to any liability of Holder for the
      purchase price of any Common Stock or as a stockholder of the Company, whether
      such liability is asserted by the Company or by creditors of the
      Company.

     

    k) Remedies.
      Holder,
      in addition to being entitled to exercise all rights granted by law, including
      recovery of damages, will be entitled to specific performance of its rights
      under this Warrant. The Company agrees that monetary damages would not be
      adequate compensation for any loss incurred by reason of a breach by it of
      the
      provisions of this Warrant and hereby agrees to waive the defense in any action
      for specific performance that a remedy at law would be adequate.

     

    l) Successors
      and Assigns.
      Subject
      to applicable securities laws, this Warrant and the rights and obligations
      evidenced hereby shall inure to the benefit of and be binding upon the
      successors of the Company and the successors and permitted assigns of Holder.
      The provisions of this Warrant are intended to be for the benefit of all Holders
      from time to time of this Warrant and shall be enforceable by any such Holder
      or
      holder of Warrant Shares.

     

    m) Amendment.
      This
      Warrant may be modified or amended or the provisions hereof waived with the
      written consent of the Company and the Holder.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    n) Severability.
      Wherever possible, each provision of this Warrant shall be interpreted in such
      manner as to be effective and valid under applicable law, but if any provision
      of this Warrant shall be prohibited by or invalid under applicable law, such
      provision shall be ineffective to the extent of such prohibition or invalidity,
      without invalidating the remainder of such provisions or the remaining
      provisions of this Warrant.

     

    o) Headings.
      The
      headings used in this Warrant are for the convenience of reference only and
      shall not, for any purpose, be deemed a part of this Warrant.

    

    ********************

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
      officer thereunto duly authorized.

    

    Dated:
      ________, 2008

    

      
        	 	
                FUTURE
                  NOW GROUP INC.

              
	 	 
	 	
                By:

              	 
	 	 	
                Name:
                  

              
	 	 	
                Title:
                  

              

      

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    NOTICE
      OF EXERCISE

    

    TO: FUTURE
      NOW GROUP, INC.

    

    (1) The
      undersigned hereby elects to purchase ________ Warrant Shares of the Company
      pursuant to the terms of the attached Warrant (only if exercised in full),
      and
      tenders herewith payment of the exercise price in full, together with all
      applicable transfer taxes, if any.

     

    (2) Payment
      shall take the form of (check applicable box):

     

    o
      a bank wire in lawful
      money of the United States; or

     

    o
      the cancellation of such number of
      Warrant Shares as is necessary, in accordance with the formula set forth in
      subsection 2(c), to exercise this Warrant with respect to the maximum number
      of
      Warrant Shares purchasable pursuant to the cashless exercise procedure set
      forth
      in subsection 2(c).

     

    (3) Please
      issue a certificate or certificates representing said Warrant Shares in the
      name
      of the undersigned or in such other name as is specified below:

    _______________________________

    

    The
      Warrant Shares shall be delivered to the following:

    _______________________________

     

    _______________________________

    

    (4)
      Accredited
      Investor.
      The
      undersigned is an “accredited investor” as defined in Regulation D promulgated
      under the Securities Act of 1933, as amended.

    

    [SIGNATURE
      OF HOLDER]

     

    Name
      of
      Investing Entity:
      __________________________________________________________________

     

    Signature
      of Authorized Signatory of Investing Entity:
      ____________________________________________

     

    Name
      of
      Authorized Signatory:
      _____________________________________________________________

     

    Title
      of
      Signatory: _______________________ Date: _______________

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    ASSIGNMENT
      FORM

    

    (Note:
      To assign the foregoing warrant, execute this form and supply required
      information. Do not use this form to exercise the
      warrant.)

    

    FOR
      VALUE
      RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby
      assigned to:

    

    ________________________________________________________________________whose
      address is

    _______________________________________________________________________________________________________________________________.

     

    Dated:
      ______________, _______

    

      
        	 	
                Holder’s
                  Signature:

              	 	 
	 	 	 	 
	 	
                Holder’s
                  Address:

              	 	 
	 	 	 	 
	 	 	 	 

      

    

    

    Signature
      Guaranteed: _______________________________________

    

    NOTE:
      The signature to this Assignment Form must correspond with the name as it
      appears on the face of the Warrant, without alteration or enlargement or any
      change whatsoever, and must be guaranteed by a bank or trust company. Officers
      of corporations and those acting in a fiduciary or other representative capacity
      should file proper evidence of authority to assign the foregoing
      Warrant.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]