Document:

Exhibit 10.1 

AGREEMENT TO EXCHANGE
COMMON STOCK 
BETWEEN 

BRISHLIN RESOURCES,
INC.

AND CERTAIN SHAREHOLDERS OF 

SYNERGY RESOURCES
CORPORATION 

	INDEX
 
  
	ARTICLE I - EXCHANGE OF SECURITIES	 	 	 	1	 
	     1.01  -  Exchange of Stock	 	 	 	1	 
	     1.02  -  Exchange of Options and Warrants	 	 	 	1	 
	 	
	ARTICLE II - REPRESENTATIONS AND WARRANTIES	 	 	 	2	 
	     2.01  -  Organization	 	 	 	2	 
	     2.02  -  Capital	 	 	 	2	 
	     2.03  -  Directors and Officers	 	 	 	2	 
	     2.04  -  Financial Statements	 	 	 	2	 
	     2.05  -  Absence of Changes	 	 	 	2	 
	     2.06  -  Absence of Undisclosed Liabilities	 	 	 	3	 
	     2.07  -  Tax Returns	 	 	 	3	 
	     2.08  -  Investigation of Financial Condition	 	 	 	3	 
	     2.09  -  Trade Names and Rights	 	 	 	3	 
	     2.10  -  Contracts and Leases	 	 	 	3	 
	     2.11  -  Insurance Policies	 	 	 	3	 
	     2.11  -  Compliance with Laws	 	 	 	3	 
	     2.13  -  Litigation	 	 	 	4	 
	     2.14  -  No Further Consent	 	 	 	4	 
	     2.15  -  SEC Documents	 	 	 	4	 
	     2.16  -  Full Disclosure	 	 	 	4	 
	     2.17  -  Assets	 	 	 	4	 
	     2A  -  Organization	 	 	 	4	 
	     2B  -  Directors and Officers' Compensation; Banks	 	 	 	4	 
	     2C  -  Capital	 	 	 	5	 
	     2D -  Financial Statements	 	 	 	5	 
	     2E -  Absence of Changes	 	 	 	5	 
	     2F -  Absence of Undisclosed Liabilities	 	 	 	5	 
	     2G -  Tax Returns	 	 	 	5	 
	     2H -  Investigation of Financial Condition	 	 	 	5	 
	     2I -  Trade Names and Rights	 	 	 	6	 
	     2J -  Contracts and Leases	 	 	 	6	 
	     2K -  Insurance Policies	 	 	 	6	 
	     2L  -  Compliance with Laws	 	 	 	6	 
	     2M -  Litigation	 	 	 	6	 
	     2N -  Ability to Carry Out Obligations	 	 	 	6	 
	     2O -  Full Disclosure	 	 	 	7	 
	     2P -  Market for Common Stock	 	 	 	7	 
		

-i- 

		
	ARTICLE III - SHAREHOLDER REPRESENTATIONS	 	 	 	7	 
	   3.01 - Ability to Carry Out Obligations	 	 	 	7	 
	   3.02 - Ownership of Securities	 	 	 	7	 
	   3.03 - Restricted Securities	 	 	 	7	 
	 	
	ARTICLE IV - OBLIGATIONS BEFORE CLOSING	 	 	 	8	 
	   4.01 - Investigative Rights	 	 	 	8	 
	   4.02 - Conduct of Business	 	 	 	8	 
	   4.03 - Mutual Cooperation	 	 	 	8	 
	   4.04 - Publicity	 	 	 	8	 
	 	
	ARTICLE V - CONDITIONS PRECEDENT TO PERFORMANCE BY BRISHLIN	 	 	 	9	 
	   5.01 - Conditions	 	 	 	9	 
	   5.02 - Accuracy of Representations	 	 	 	9	 
	   5.03 - Performance	 	 	 	9	 
	   5.04 - Absence of Litigation	 	 	 	9	 
	   5.05 - Other	 	 	 	9	 
	 	
	ARTICLE VI - CONDITIONS PRECEDENT TO PERFORMANCE BY THE SYNERGY SHAREHOLDERS	 	 	 	10	 
	   6.01 - Conditions	 	 	 	10	 
	   6.02 - Accuracy of Representations	 	 	 	10	 
	   6.03 - Performance	 	 	 	10	 
	   6.04 - Absence of Litigation	 	 	 	10	 
	   6.05 - Other	 	 	 	10	 
	 	
	ARTICLE VII - CLOSING	 	 	 	11	 
	   7.01 - Closing	 	 	 	11	 
	   7.02 - Exchange of Shares	 	 	 	11	 
	   7.03 - Warrants and Options	 	 	 	11	 
	   7.04 - Officers and Directors	 	 	 	11	 
	   7.05 - Post Closing Agreements	 	 	 	11	 
	 	
	ARTICLE VIII - REMEDIES	 	 	 	13	 
	   8.01 - Arbitration	 	 	 	13	 
	   8.02 - Costs	 	 	 	13	 
	   8.03 - Termination	 	 	 	13	 

-ii- 

		
	ARTICLE IX - MISCELLANEOUS	 	 	 	14	 
	   9.01 - Captions and Headings	 	 	 	14	 
	   9.02 - No Oral Change	 	 	 	14	 
	   9.03 - Non-Waiver	 	 	 	14	 
	   9.04 - Time of Essence	 	 	 	14	 
	   9.05 - Entire Agreement	 	 	 	14	 
	   9.06 - Governing Law	 	 	 	14	 
	   9.07 - Counterparts	 	 	 	14	 
	   9.08 - Notices	 	 	 	14	 
	   9.09 - Binding Effect	 	 	 	15	 
	   9.10 - Effect of Closing	 	 	 	15	 
	   9.11 - Mutual Cooperation	 	 	 	15	 
	   9.12 - Expenses	 	 	 	15	 

LIST OF SCHEDULES AND EXHIBITS  

	 	
Schedule
1     -    Allocation of Shares, Warrants and Options      
Exhibit A      -    Options,
Warrants and Convertible Securities (Synergy)      
Exhibit B      -    Officers and
Directors (Synergy)      
Exhibit C      -    Financial Statements - Changes in Financial
Condition (Synergy)      
Exhibit D      -    Trademarks, Trade Names and Copyrights
(Synergy)      
Exhibit E      -    Material Contracts (Synergy)      
Exhibit F      -
   Insurance Policies (Synergy)      
Exhibit G      -    Officers, Directors, Bank
Accounts, Safe Deposit Boxes,                                Powers of Attorney
(Brishlin)      
Exhibit H      -    Options, Warrants and Convertible Securities
(Brishlin)      
Exhibit I      -    Financial Statements - Changes in Financial Condition
(Brishlin)      
Exhibit J      -    Trademarks, Trade Names and Copyrights (Brishlin)
    
 Exhibit K      -    Material Contracts (Brishlin)      
Exhibit L      -    Insurance
Policies (Brishlin)      
Exhibit M      -    Litigation (Brishlin)      
Exhibit N      -
   Investment Letter      
Exhibit O      -    Consulting Agreements      
Exhibit P      -
   Acquisition Plan 

-iii- 

AGREEMENT TO EXCHANGE
COMMON STOCK  

        This
AGREEMENT TO EXCHANGE COMMON STOCK (“Agreement”) is made
August 27, 2008 by and between Brishlin Resources, Inc., a corporation organized under
the laws of the State of Colorado (“Brishlin”) and the shareholders of
Synergy Resources Corporation (“Synergy”) who have executed this
Agreement on the signature page hereof (“Synergy Shareholders”), Bill
Conrad and Raymond McElhaney (the “Brishlin Principals”) and Ed Holloway,
William E. Scaff, Jr., John Barton and Benjamin Barton (“the Synergy
Principals”). 

        WHEREAS,
Brishlin wishes to acquire all of the capital stock of Synergy owned by the Synergy
Shareholders, representing not less than 90% of all of the issued and outstanding capital
stock of Synergy; and 

        WHEREAS,
it is contemplated that following the closing of the transactions contemplated by this
Agreement, Synergy will be merged with and into Brishlin, with Brishlin being the
surviving corporation; and 

        WHEREAS,
the parties to this Agreement desire to set forth the terms and conditions pursuant to
which Brishlin will acquire the capital stock owned by the Synergy Shareholders. 

        NOW
THEREFORE, in consideration of the foregoing recitals, which shall be considered an
integral part of this Agreement, and the mutual promises, covenants and representations
contained herein, the parties hereby agree as follows: 

ARTICLE I
EXCHANGE OF
SECURITIES 

        1.01
    
Exchange of Stock.   At the Closing (as hereinafter defined), and
subject to the terms and conditions of this Agreement, Brishlin shall acquire an aggregate
of 8,935,000 shares of Synergy common stock (the “Synergy Shares”) from
the Synergy Shareholders, representing at least 89% of the issued and outstanding stock of
Synergy (the “Exchange”). The consideration to be issued by Brishlin for
the Synergy Shares shall be the issuance of 8,935,000 (post-split) shares of Brishlin (the
shares of Brishlin will be exchanged for the shares of Synergy on a one for one basis; the
“Exchange Shares”). The Exchange Shares shall be allocated to the Synergy
Shareholders in accordance with Schedule 1 to this Agreement. As a result of the
Exchange, the Synergy Shareholders shall own common stock of Brishlin and Synergy will
become a subsidiary of Brishlin. For federal income tax purposes, it is intended that the
Exchange shall constitute a reorganization within the meaning of Section 368 of the
Internal Revenue Code of 1986, as amended (the “Code”). 

        1.02
    Exchange of Options and Warrants.   Each warrant or option to purchase
shares of Synergy (individually, a “Synergy Option” or collectively, the
“Synergy Options”) that is held by a Synergy Shareholder and which is
outstanding immediately prior to the Closing, without regard to whether such option is
then exercisable, shall be assumed by Brishlin and converted into an option (a
“Substitute Option”) or warrant (a “Substitute Warrant”)
to purchase that number of shares of Brishlin’s common stock shown on Schedule 1 at
an exercise price per share equal to the exercise price per share of such corresponding
Synergy Option or Synergy Warrant. The terms and conditions of each Substitute Option or
Substitute Warrant, including any acceleration of vesting and/or exercisability thereof,
shall otherwise be the same as the related Synergy Option. 

1 

ARTICLE
II
REPRESENTATIONS AND WARRANTIES 

        Ed
Holloway  (solely in his  capacity  as an officer  and  director  of  Synergy),  William
E. Scaff,  Jr. (solely in his capacity as an officer and  director of Synergy),  John
Barton and  Benjamin  Barton  represent  and warrant to Brishlin that, to the best of
their knowledge: 

        2.0l
    
Organization.   Synergy is a corporation duly organized, validly
existing, and in good standing under the laws of Colorado, has all necessary corporate
power to own its properties and to carry on its business as now owned and operated by it,
and is duly qualified to do business and is in good standing in each of the states where
its business requires qualification. 

        2.02
    Capital.   The authorized capital stock of Synergy consists of
50,000,000 shares of common stock and 5,000,000 shares of preferred stock, of which
9,960,000 shares of common stock are outstanding as of the date hereof. Synergy has not
issued any shares of preferred stock. Except as set forth in Exhibit A, there are no
subscriptions, options, rights, warrants, convertible securities, or other agreements or
commitments outstanding obligating Synergy to issue or to transfer from treasury any
additional shares of its capital stock. All outstanding shares of Synergy are validly
issued, fully paid and not assessible and not subject to any preemptive rights. All of the
issued and outstanding shares of Synergy common stock were issued in compliance with all
federal and state securities laws. 

        2.03
    Directors and Officers.   Exhibit B to this Agreement contains the
names and titles of all directors and officers of Synergy. 

        2.04
    Financial Statements.   Exhibit C to this Agreement contains the
balance sheet of Synergy as of July 31, 2008 and the related statement of income for the
period then ended (the “Synergy Financial Statements”). The Synergy
Financial Statements are complete and correct in all material respects and fairly present
in all material respects the financial condition and results of operation of Synergy at
such date and for such period and show all material liabilities, absolute or contingent,
of Synergy. 

        2.05
    Absence of Changes.   Since July 31, 2008, there has not been any
change in the financial condition or results of operations of Synergy, except changes
reflected on Exhibit C or changes in the ordinary course of business, which changes have
not in the aggregate been materially adverse. 

2 

        2.06
    Absence of Undisclosed Liabilities.   Synergy did not as of July 31,
2008 have any debt, liability, or obligation of any nature, whether accrued, absolute,
contingent, or otherwise, and whether due or to become due, that is not reflected on
Exhibit C. 

        2.07
    Tax Returns.   Within the times and in the manner prescribed by law,
Synergy has filed all federal, state, and local tax returns required by law and has paid
all taxes, assessments, and penalties due and payable. The provision for taxes, if any,
reflected in Synergy’s balance sheet as of July 31, 2008 is adequate for any and all
federal, state, county, and local taxes for the period ending on the date of that balance
sheet and for all prior periods, whether or not disputed. There are no present disputes as
to taxes of any nature payable by Synergy. 

        2.08
    Investigation of Financial Condition.   Without in any manner reducing
or otherwise mitigating the representations contained herein, Brishlin shall have the
opportunity between the date of this Agreement and the Closing to meet with Synergy’s
accountants and attorneys to discuss the financial condition of Synergy. Synergy shall
make available to Brishlin the books and records of Synergy. Such books and records have
been maintained in the ordinary course of business, and are true and correct copies of
such books and records. The minutes of Synergy are a complete and accurate record of all
meetings of the shareholders and directors of Synergy and accurately reflect all actions
taken at such meetings. The signatures of the directors and/or officers on such minutes
are the valid signatures of Synergy’s directors and/or officers who were duly elected
or appointed on the dates that the minutes were signed by such persons. The stock book of
Synergy contains an accurate record of all transactions with respect to the capital stock
of Synergy. 

        2.09
    Trade Names and Rights.   Exhibit D attached hereto and made a part
hereof lists all trademarks, trademark registrations or applications, trade names, service
marks, copyrights, copyright registrations or applications which are owned by Synergy. No
person other than Synergy owns any trademark, trademark registration or application,
service mark, trade name, copyright, or copyright registration or application the use of
which is necessary or contemplated in connection with the operation of Synergy’s
business. 

        2.10
    Contracts and Leases.   Exhibit E attached hereto and made a part
hereof contains a summary of the provisions of all material contracts, leases, and other
agreements of Synergy presently in existence or which have been agreed to by Synergy
(whether written or oral). Except as disclosed on Exhibit E, Synergy is not in default
under of these agreements or leases. 

        2.11
    Insurance Policies.   Exhibit F to this Agreement is a description of
all insurance policies held by Synergy concerning its business and properties. All these
policies are in the respective principal amounts set forth in Exhibit F and are in full
force and effect. 

        2.12
    Compliance with Laws.   Synergy has complied with, and is not in
violation of, applicable federal, state, or local statutes, laws, and regulations
affecting its properties or the operation of its business. 

3 

        2.13
    Litigation.   Synergy is not a party to any suit, action, arbitration,
legal, administrative, or other proceeding, or governmental investigation pending or, to
the best knowledge of Synergy, threatened against or affecting Synergy or its business,
assets, or financial condition. Synergy is not in default with respect to any order, writ,
injunction, or decree of any federal, state, local, or foreign court, department, agency,
or instrumentality. Synergy is not engaged in any legal action to recover moneys due to
Synergy or damages sustained by Synergy. 

        2.14
    No Further Consent.   No consent, approval, order, or authorization,
of, or registration, declaration or filing with, any court, administrative agency,
commission or other governmental authority or instrumentality is required in connection
with the execution, delivery and performance of this Agreement. 

        2.15
    SEC Documents.   Brishlin has furnished the Synergy Shareholders with
copies of its annual report on Form 10-K for the year ended December 31, 2007,
its quarterly report on Form 10-Q for the period ended March 31, 2008 and its
quarterly report on Form 10-Q for the period ended June 30, 2008 as filed with
the U.S. Securities and Exchange Commission (the “SEC”). 

        2.16
    Full Disclosure.   None of the representations and warranties made by
the Synergy Principals, or in any certificate or memorandum furnished or to be furnished
by the Synergy Principal, or on their behalf, contains or will contain any untrue
statement of material fact, or omit any material fact the omission of which would be
misleading. 

        2.17
    Assets.   Synergy has good and marketable title to all of its property,
free and clear of all mortgages, liens, pledges, charges or encumbrances or interest of
any third party whatsoever. 

        Brishlin,
Bill Conrad (solely in his capacity as a director of Brishlin and to the best of his
knowledge) and Ray McElhaney (solely in his capacity as an officer and director of
Brishlin and to the best of his knowledge) represent and warrant to the Synergy
Shareholders that: 

         
    2A.       
          Organization.   Brishlin is a corporation duly organized,
          validly existing, and in good standing under the laws of Colorado, has all
          necessary corporate powers to own its properties and to carry on its business as
          now owned and operated by it, and is duly qualified to do business and is in
          good standing in each of the states where its business requires qualification,
          except in those states where the failure to be so qualified would not have a
          material adverse effect on Brishlin. 

         
    2B.       
          Directors and Officers’ Compensation; Banks.   Exhibit G
          to this Agreement contains: (i) the names and titles of all directors and
          officers of Brishlin and all persons whose compensation from Brishlin as of the
          date of this Agreement will equal or is expected to equal or exceed, at an
          annual rate, the sum of $1,000; (ii) the name and address of each bank with
          which Brishlin has an account or safety deposit box, and the names of all
          persons who are authorized to draw thereon or have access thereto; and (iii) the
          names of all persons who have a power of attorney from Brishlin and a summary of
          the terms thereof. 

4 

         
    2C.       
          Capital.   The authorized capital stock of Brishlin consists
          of 100,000,000 shares of common stock, and 10,000,000 shares of preferred stock.
          Immediately prior to Closing, 1,038,000 shares of common stock will be issued
          and outstanding. All of the shares are validly issued, fully paid, and
          non-assessable. At Closing, there will be no outstanding preferred shares and no
          outstanding subscriptions, options, rights, warrants, convertible securities, or
          other agreements or commitments obligating Brishlin to issue or to transfer from
          treasury any additional shares of its capital stock of any class except as
          reflected on Exhibit H. 

         
    2D.       
          Financial Statements.   Exhibit I to this Agreement sets
          forth the balance sheet of Brishlin as of June 30, 2008, and the related
          statement of income for the period then ended (the “Brishlin Financial
          Statements”). The Brishlin Financial Statements comply as to form in
          all material respects with applicable requirements of the SEC with respect
          thereto, are accurate and in accordance with the books and records of Brishlin,
          have been prepared in accordance with generally accepted accounting principles
          applied on a consistent basis during the period involved, except as may be
          indicated in the notes thereto or as permitted by rules of the SEC. 

         
    2E.       
          Absence of Changes.   Since June 30, 2008, there has not been
          any material change in the financial condition or operations of Brishlin, except
          (i) changes in the ordinary course of business, which changes have not in the
          aggregate been materially adverse, and (ii) changes disclosed on Exhibit I. 

         
    2F.       
          Absence of Undisclosed Liabilities.   Brishlin did not as of
          June 30, 2008 have any debt, liability, or obligation of any nature, whether
          accrued, absolute, contingent, or otherwise, and whether due or to become due,
          that is not reflected on Exhibit I. 

         
    2G.       
          Tax Returns.   Within the times and in the manner prescribed
          by law, Brishlin has filed all federal, state, and local tax returns required by
          law and has paid all taxes, assessments, and penalties due and payable, except
          where the failure to file and/or pay would not have a material adverse effect on
          Brishlin. No federal income tax returns of Brishlin have been audited by the
          Internal Revenue Service. The provision for taxes, if any, reflected in Brishlin
          ‘s balance sheet as of June 30, 2008, is adequate for any and all federal,
          state, county, and local taxes for the period ending on the date of that balance
          sheet and for all prior periods, whether or not disputed. There are no present
          disputes as to taxes of any nature payable by Brishlin. 

         
    2H.       
          Investigation of Financial Condition of Brishlin.   Without
          in any manner reducing or otherwise mitigating the representations contained
          herein, the Synergy Shareholders shall have the opportunity to meet with
          Brishlin ‘s accountants and attorneys to discuss the financial condition of
          Brishlin. Brishlin shall make available to Synergy the books and records of
          Brishlin. The minutes of Brishlin are a complete and accurate record of all
          meetings of the shareholders and directors of Brishlin and accurately reflect
          all actions taken at such meetings. The signatures of the directors and/or
          officers on such minutes are the valid signatures of Brishlin’s directors
          and/or officers who were duly elected or appointed on the dates that the minutes
          were signed by such persons. 

5 

         
    2I.       
          Trade Names and Rights.   Exhibit J attached hereto and made
          a part hereof lists all trademarks, trademark registrations or applications,
          trade names, service marks, copyrights, copyright registrations or applications
          which are owned by Brishlin. No person, other than Brishlin, will own any
          trademark, trademark registration or application, service mark, trade name,
          copyright, or copyright registration or application the use of which is
          necessary or contemplated in connection with the operation of the business of
          Brishlin, as such business is to be conducted after the closing of this
          transaction. 

         
    2J.       
          Contracts and Leases.   The list of material contracts
          itemized in Brishlin’s annual report on Form 10-K for the year ended
          December 31, 2007 contains all of the material contracts, leases and other
          agreements of Brishlin presently in existence or which have been agreed to by
          Brishlin. Except as listed in Exhibit K, Brishlin is not a party to any other
          material contract or agreement, whether written or oral. Except as noted on
          Exhibit K, Brishlin is not in default under any of these agreements or
          leases. 

         
    2K.       
          Insurance Policies.   Exhibit L to this Agreement is a
          description of all insurance policies held by Brishlin concerning its business
          and properties. All these policies are in the respective principal amounts set
          forth in Exhibit L and are in full force and effect. 

         
    2L.       
          Compliance with Laws.   Brishlin has complied with, and is
          not in violation of, applicable federal, state, or local statutes, laws, and
          regulations affecting its properties or the operation of its business, including
          but not limited to federal and state securities laws. Brishlin does not have any
          employee benefit plan which is subject to the provisions of the Employee
          Retirement Income Security Act of 1974. 

         
    2M.       
          Litigation.   Other than as disclosed on Exhibit M, Brishlin
          is not a party to any suit, action, arbitration, legal, administrative, or other
          proceeding, or governmental investigation pending or, to the best knowledge of
          Brishlin, threatened against or affecting Brishlin or its business, assets, or
          financial condition. Brishlin is not in default with respect to any order, writ,
          injunction, or decree of any federal, state, local, or foreign court,
          department, agency, or instrumentality. Brishlin is not engaged in any legal
          action to recover moneys due to it or damages sustained by it other than as
          disclosed on Exhibit M. 

         
    2N.       
          Ability to Carry Out Obligations.   Brishlin has the right,
          power, and authority to enter into, and perform its obligations under, this
          Agreement. The execution and delivery of this Agreement by Brishlin and the
          performance by Brishlin of its obligations hereunder will not cause, constitute,
          or conflict with or result in (a) any breach or violation of any of the
          provisions of or constitute a default under any license, indenture, mortgage,
          charter, instrument, articles of incorporation, by-law, or other agreement or
          instrument to which Brishlin is a party, or by which it may be bound, nor will
          any consents or authorizations of any party other than those hereto be required,
          (b) an event that would permit any party to any agreement or instrument to
          terminate it or to accelerate the maturity of any indebtedness or other
          obligation of Brishlin, or (c) an event that would result in the creation or
          imposition or any lien, charge, or encumbrance on any asset of Brishlin or would
          create any obligations for which Brishlin would be liable, except as
          contemplated by this Agreement. 

6 

         
    2O.       
          Full Disclosure.   None of the representations and warranties
          made by Brishlin, or the Brishlin Principals, or in any certificate or
          memorandum furnished or to be furnished by Brishlin, or the Brishlin Principals,
          or on their behalf, contains or will contain any untrue statement of material
          fact, or omit any material fact the omission of which would be misleading.
          Brishlin and the Brishlin Principals have disclosed to Synergy all reasonably
          foreseeable contingencies which, if such contingencies transpire, would have a
          material adverse effect on Brishlin. 

         
    2P.       
          Market for Common Stock.   Brishlin’s common stock is
          quoted on the OTC Bulletin Board. No letter “E” has been appended to
          Brishlin’s common stock during the past twenty-four months and Brishlin has
          not received any notice of the possible or pending delisting of Brishlin’s
          common stock. 

ARTICLE III
SHAREHOLDER
 REPRESENTATIONS 

        
    3.01       
Ability to Carry Out Obligations.   Each Synergy Shareholder has the
right, power, and authority to enter into, and perform its obligations under, this
Agreement. No other corporate or shareholder proceedings on the part of any Synergy
Shareholder are necessary to authorize the Exchange or the other transactions contemplated
hereby, except as otherwise set forth herein. The execution and delivery of this Agreement
by each Synergy Shareholder has (to the extent required) been authorized by the necessary
action of its board of directors, partners, managers or other governing body, and does
not, and the performance by each Synergy Shareholder of its obligations hereunder will
not, cause, constitute, or conflict with or result in (a) any breach or violation of
any of the provisions of or constitute a default under any license, indenture, mortgage,
charter, instrument, articles of incorporation, by-law, or other agreement or instrument
to which any Synergy Shareholder is a party, or by which it may be bound, nor will any
consents or authorizations of any other party be required, (b) an event that would
permit any party to any agreement or instrument to terminate it or to accelerate the
maturity of any indebtedness or other obligation, or (c) an event that would result
in the creation or imposition or any lien, charge, or encumbrance on any asset of Synergy
or would create any obligation for which Synergy would be liable, except as contemplated
by this Agreement. 

        
    3.02       
Ownership of Securities.   Each Synergy Shareholder is the owner of
that number of Synergy common shares, warrants or options disclosed in Schedule 1,
attached hereto and incorporated herein by reference. Each Synergy Shareholder is the
owner of such securities, free and clear of all liens, claims and encumbrances, and each
has the sole power, right and authority to enter into and perform his obligations under
this Agreement and transfer the securities owned by him. 

        
    3.03       
Restricted Securities.   The Synergy Shareholders acknowledge that the
Exchange Shares will not be registered under the Securities Act of 1933, as amended (the
“1933 Act”) but will be issued pursuant to an exemption from such
registration requirements. As a result, the Exchange Shares will be subject to
restrictions on transfer imposed by the 1933 Act. Each Synergy Shareholder shall execute
and deliver to Brishlin at Closing an investment letter in the form attached hereto as
Exhibit N and incorporated herein by reference. 

7 

ARTICLE IV
OBLIGATIONS
 BEFORE CLOSING 

        
    4.0l       
Investigative Rights.   From the date of this Agreement until the
Closing, each party shall provide to the other party, and such other party’s counsel,
accountants, auditors, and other authorized representatives, full access during normal
business hours and upon reasonable advance notice to all of each party’s properties,
books, contracts, commitments, records and correspondence and communications with
regulatory agencies for the purpose of examining the same. Each party shall furnish the
other party with all information concerning each party’s affairs as the other party
may reasonably request. 

        
    4.02       
Conduct of Business.   Prior to the Closing, and except as contemplated
by this Agreement, Brishlin shall conduct its business in the normal course, and shall not
sell, pledge, or assign any assets without the prior written approval of the other party,
except in the regular course of business. Each Synergy Principal shall cause Synergy to
conduct its business in the ordinary course and shall not sell, pledge or assign any
assets without the prior written approval of the other party, except in the regular course
of business. Except as contemplated by this Agreement, Brishlin shall not and no Synergy
Principal shall allow Synergy to amend its Articles of Incorporation or By-laws, declare
dividends, redeem or sell stock or other securities, incur additional or newly-funded
material liabilities, acquire or dispose of fixed assets, change senior management, change
employment terms, enter into any material or long-term contract, guarantee obligations of
any third party, settle or discharge any balance sheet receivable for less than its stated
amount, pay more on any liability than its stated amount, or enter into any other
transaction other than in the regular course of business. 

        
    4.03       
Mutual Cooperation.   Brishlin, the Brishlin Principals, each Synergy
Shareholder, and each Synergy Principal will take all reasonable actions necessary to
comply promptly with all legal requirements which may be imposed on itself with respect to
the Exchange and will promptly cooperate with and furnish information to each other in
connection with any such requirements imposed upon any of them or any of their related
entities or subsidiaries. Each party will take all reasonable actions necessary to obtain
any consent, authorization, order or approval of, or any exemption by, any governmental
entity or other public or private third party required to be obtained or made by either of
them in connection with the Exchange or the taking of any action contemplated by this
Agreement. 

        
    4.04       
Publicity.   Except as otherwise required by law or rules of the SEC,
so long as this Agreement is in effect, no party shall issue or cause the publication of
any press release or other public announcement with respect to the transactions
contemplated by this Agreement without the prior written consent of the other party, which
consent shall not be unreasonably withheld. 

8 

ARTICLE V
CONDITIONS
 PRECEDENT TO PERFORMANCE BY BRISHLIN 

        
    5.01        
Conditions.   Brishlin’s obligations hereunder shall be subject to
the satisfaction, at or before the Closing, of all the conditions set forth in this
Article V. Brishlin may waive any or all of these conditions in whole or in part without
prior notice; provided, however, that no such waiver of a condition shall constitute a
waiver by Brishlin of any other condition of or any of Brishlin’s other rights or
remedies, at law or in equity. 

        
    5.02        
Accuracy of Representations.   Except as otherwise permitted by this
Agreement, all representations and warranties by the Synergy Shareholders in this
Agreement or in any written statement that shall be delivered to Brishlin under this
Agreement shall be true on the date hereof and as of the Closing Date as though made at
those times. 

        
    5.03        
Performance.   The Synergy Shareholders shall have performed,
satisfied, and complied with all covenants, agreements, and conditions required by this
Agreement to be performed or complied with by them, on or before the Closing. Brishlin
shall have obtained all necessary consents and approvals necessary to consummate the
transactions contemplated hereby. 

        
    5.04        
Absence of Litigation.   No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction contemplated by
this Agreement or to its consummation, shall have been instituted or threatened on or
before the Closing. 

        
    5.05        
Other. In addition to the other provisions of this Article V,
Brishlin’s obligations hereunder shall be subject to the satisfaction, at or before
the Closing, of the following: 

		
        (i)        
               Brishlin
will have received the affirmative vote of the holders of a requisite
               majority of its common stock to reverse split its common stock such that,
               following notification of FINRA, and following expiration of the requisite
               waiting period, 1,038,000 shares of Brishlin’s common stock will be
               outstanding.  

		
        (ii)                      Brishlin
shareholders dissenting from the reverse split will not own more than                10%
of Brishlin’s common stock.  

		
        
(iii)        Following
approval of the reverse stock split, the Board of Directors of                Brishlin
shall have declared a dividend consisting of one warrant to purchase a
               share of Brishlin common stock for each ten shares of common stock then
               outstanding (“Warrant”). The Warrants will be exercisable
at a                price of $6.00 per share and will expire on the earlier of December
31, 2012 or                twenty days following written notification from Brishlin that
its common stock                had a closing bid price at or above $7.00 for any ten of
twenty consecutive                trading days. The Warrants will not be issuable until a
registration statement                covering the issuance of the Warrants, as well as
the shares issuable upon the                exercise of the warrants, has been declared
effective by the SEC.  

9 

		    
    (iv)                       Brishlin
will have entered into Consulting Agreements, in the form and substance
               attached hereto as Exhibit O and incorporated herein by reference, which
will                provide that Raymond E. McElhaney and Bill Conrad will each be paid
consulting                fees.  

		
        
(v)                    Brishlin
shall have received an Investment Letter in the form attached hereto as
               Exhibit N and incorporated herein by reference executed by each
Synergy                Shareholder.  

ARTICLE VI
CONDITIONS
 PRECEDENT TO PERFORMANCE BY THE SYNERGY
SHAREHOLDERS 

        6.01
    
Conditions.   The obligations of the Synergy Shareholders hereunder
shall be subject to the satisfaction, at or before the Closing, of the conditions set
forth in this Article VI. The Synergy Shareholders may waive any or all of these
conditions in whole or in part without prior notice; provided, however, that no such
waiver of a condition shall constitute a waiver by any Synergy Shareholder of any other
condition of or any of such Synergy Shareholder’s other rights or remedies, at law or
in equity. 

        6.02
    
Accuracy of Representations.   Except as otherwise permitted by this
Agreement, all representations and warranties by Brishlin in this Agreement or in any
written statement that shall be delivered by Brishlin under this Agreement shall be true
on and as of the Closing Date as though made at that time. 

        6.03
    
Performance.   Brishlin shall have performed, satisfied, and complied
with all covenants, agreements, and conditions required by this Agreement to be performed
or complied with by it, on or before the Closing. 

        6.04
    
Absence of Litigation.   No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction contemplated by
this agreement or to its consummation, shall have been instituted or threatened on or
before the closing. 

        6.05
    
Other.   In addition to the other provisions of this Article VI,
Synergy’s obligations hereunder shall be subject to the satisfaction, at or before
the Closing, of the following: 

	 	(i)  	Brishlin
will have no more than $5,000 in liabilities at the closing.  

	 	(ii)  	Brishlin
will have received the affirmative vote of the holders of a requisite
                    majority of its common stock to reverse split its common stock such
that                     immediately prior to the Closing, 1,038,000 shares of Brishlin’s
common                     stock will be outstanding.  

	 	(iii)  	Brishlin
shareholders dissenting from the reverse split will own not more than
                    10% of Brishlin’s common stock.  

10 

ARTICLE VII

                                    CLOSING 

        7.0l
    
Closing.   The closing of this transaction (“Closing”)
shall be held at the offices of Synergy not more than three business days following
satisfaction of all of the conditions set forth in Articles V and VI. The date and time of
Closing is the Closing Date. Unless the Closing of this transaction takes place before
September 15, 2008, either party may terminate this Agreement without liability to the
other party, except as otherwise provided in Section 9.12. At the Closing, the following
documents, in a form reasonably acceptable to counsel to the parties or as set forth
herein, shall be delivered: 

        By
the Synergy Shareholders and the Synergy Principals: 

		    A.                             A
certificate, dated the Closing Date, that all representations, warranties,
               covenants, and conditions set forth in this Agreement on behalf of the
Synergy                Principals are true and correct as of, or have been fully
performed and complied                with by, the Closing Date.  

        By
Brishlin:  

		    A.                             A
certificate, dated the Closing Date, that all representations, warranties,
               covenants, and conditions set forth in this Agreement on behalf of
Brishlin and                the Brishlin Principals are true and correct as of, or have
been fully performed                and complied with by, the Closing Date.  

        7.02
    
Exchange of Shares.   On the Closing Date, each share of common stock
of Synergy then issued and outstanding, will be exchanged for fully paid and nonassessable
shares of Brishlin in accordance with Schedule 1 to this Agreement. Each Synergy
Shareholder shall surrender his certificate representing Synergy Shares to Brishlin and
Brishlin shall provide written instructions to its transfer agent to issue Brishlin stock
in accordance with Schedule 1. 

        7.03
    
Warrants and Options.   On the Closing Date, each warrant or option of
Synergy then outstanding and held by a Synergy shareholder will be exchanged for a
Substitute Option or Substitute Warrant in accordance with Schedule I to this Agreement. 

        7.04
    
Officer and Directors.   At the Closing, Brishlin will cause Ed
Holloway, William E. Scaff, Jr., Benjamin Barton and Rick Wilber to be appointed as
directors of Brishlin. Following such appointment, all present officers of Brishlin will
resign. 

        7.05
    
Post-Closing Agreements.   (i) Following the Closing, the Synergy
Principals, as the officers and directors of Brishlin, shall cause Brishlin to file a
registration statement with the SEC covering the Warrants and the common stock issuable
upon exercise of the Warrants. Such registration statement shall also cover, to the extent
allowable under the 1933 Act and the rules promulgated thereunder, such indeterminate
number of additional shares of Brishlin’s common stock resulting from stock splits,
stock dividends or similar transactions. The Synergy Principals shall cause Brishlin to
keep the registration statement continuously effective for a period that will terminate
upon the earlier of: 

11 

	 	•  	Six
months after the date on which 95% of the Warrants have been exercised; or 

	 	•  	Six
months after the date the warrants expire. In addition, the Synergy Shareholders shall
cause Brishlin to prepare and file such supplements to the prospectus and post-effective
amendments such that existing shareholders of Brishlin may deliver a current prospectus
in accordance with relevant provisions of the 1933 Act.  

		    (i)                             Subsequent
to Closing Date, the Synergy Principals shall cause Brishlin to file                the
following documents with the SEC within the time periods required by
               applicable rules:  

	 	(a)  	a
current report on Form 8-K containing the information required in such form
          with regard to the transactions contemplated by this Agreement;  

	 	(b)  	an
amendment to such Form 8-K containing audited financial statements, pro           forma
financial information and other additional disclosures as required by Form           8-K
with regard to the transactions contemplated hereby; and  

	 	(c)  	such
other reports as may be required to be filed by Sections 13, 14 or           15 (d)
of the Securities Exchange Act of 1934, as amended, and any           additional filings
required to maintain the listing of Brishlin’s common           stock on the OTC
Bulletin Board.  

		    (ii)                             Subsequent
to Closing Date, the Synergy Principals shall cause Synergy to have                an
option to acquire certain oil and gas assets from Petroleum Management LLC
               and/or Petroleum Exploration & Management LLC in accordance with the
               Acquisition Plan outlined in Exhibit P attached hereto.  

		    (iii)                             Subsequent
to the Closing, the parties agree that, subject to the approval of                the
Brishlin shareholders at a meeting to be held prior to the Closing, the name
               of Brishlin shall be changed to “Synergy Resources Corporation.” The
               Synergy Principals shall change the name of the subsidiary (Synergy
Resources                Corporation as contemplated by this Agreement) to allow Brishlin
to use the name                of Synergy.  

		    (iv)                             The
Synergy Principals shall cause Synergy to merge with and into Brishlin such
               that Brishlin will be the surviving corporation and the separate existence
of                Synergy shall cease.  

		    (v)                             Upon
receipt of an effective date for the registration statement contemplated by
               subsection (i) above, the Synergy Principals shall cause Brishlin to
distribute                certificates representing the Warrants to each shareholder of
Brishlin as                described on the shareholders’ list to be provided at the
Closing.  

12 

ARTICLE VIII 
REMEDIES 

        8.01
    
Arbitration.   Any controversy or claim arising out of, or relating to,
this Agreement, or the making, performance, or interpretation thereof, shall be settled by
arbitration in Denver, Colorado in accordance with the Commercial Arbitration Rules of the
American Arbitration Association, then existing, and judgment on the arbitration award may
be entered in any court having jurisdiction over the subject matter of the controversy. 

        8.02
    
Costs.   If any legal action or any arbitration or other proceeding is
brought for the enforcement of this Agreement, or because of an alleged dispute, breach,
default, or misrepresentation in connection with any of the provisions of this Agreement,
the successful or prevailing party or parties shall be entitled to recover reasonable
attorney’s fees and other costs incurred in that action or proceeding, in addition to
any other relief to which it or they may be entitled. 

        8.03
    
Termination.   In addition to other remedies available at law, Brishlin
or the Synergy Shareholders may on or prior to the Closing Date, terminate this Agreement: 

		    (i)                             If
any bona fide action or proceeding shall be pending against Brishlin or
               Synergy on the Closing Date that could result in an unfavorable judgment,
               decree, or order that would prevent or make unlawful the carrying out of
this                Agreement or if any agency of the federal or of any state government
shall have                objected at or before the Closing Date to this acquisition or
to any other                action required by or in connection with this Agreement;  

		    (ii)                             If
the legality and sufficiency of all steps taken and to be taken by each party
               in carrying out this Agreement shall not have been approved by the
respective                party’s counsel, which approval shall not be unreasonably
withheld;  

		    (iii)                             If
a party breaches any representation, warranty, covenant or obligation of such
               party set forth herein and such breach is not corrected within ten days of
               receiving written notice from the other party of such breach; and  

		    (iv)                             In
the event of termination of this Agreement by Synergy or Brishlin as provided
               in Section 7.01 or 8.03, this Agreement forthwith shall become void and
there                shall be no liability or obligation on the part of any party hereto
except as                set forth in Section 9.12 and except that no termination
shall relieve a                party from liability for breach of any of the terms of
this Agreement.  

13 

ARTICLE IX 
MISCELLANEOUS 

        9.01
    
Captions and Headings.   The Article and paragraph headings throughout
this Agreement are for convenience and reference only, and shall in no way be deemed to
define, limit, or add to the meaning of any provision of this Agreement. 

        9.02
    
No Oral Change.   This Agreement and any provision hereof, may not be
waived, changed, modified, or discharged orally, but only by an agreement in writing
signed by the party against whom enforcement of any waiver, change, modification, or
discharge is sought. 

        9.03
    
Non-Waiver.   Except as otherwise expressly provided herein, no waiver
of any covenant, condition, or provision of this Agreement shall be deemed to have been
made unless expressly in writing and signed by the party against whom such waiver is
charged; and (i) the failure of any party to insist in any one or more cases upon the
performance of any of the provisions, covenants, or conditions of this Agreement or to
exercise any option herein contained shall not be construed as a waiver or relinquishment
for the future of any such provisions, covenants, or conditions, (ii) the acceptance of
performance of anything required by this Agreement to be performed with knowledge of the
breach or failure of a covenant, condition, or provision hereof shall not be deemed a
waiver of such breach or failure, and (iii) no waiver by any party of one breach by
another party shall be construed as a waiver with respect to any other or subsequent
breach. 

        9.04
    
Time of Essence.   Time is of the essence of this Agreement and of each and
every provision hereof.  

        9.05
    
Entire Agreement.   This Agreement contains the entire Agreement and understanding
between the parties hereto, and supersedes all prior agreements, understandings
and the letters of intent between the parties.  

        9.06
    
Governing Law.   This Agreement and its application shall be governed by the laws of
Colorado.  

        9.07
    
Counterparts.   This Agreement may be executed simultaneously in one or
more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument. Facsimile signatures or signatures sent via
email will be treated as original signatures. 

        9.08
    
Notices.   All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed to have been duly given on
the date of service if served personally on the party to whom notice is to be given, or on
the third day after mailing if mailed to the party to whom notice is to be given, by first
class mail, registered or certified, postage prepaid, and properly addressed as follows: 

14 

	 	
Brishlin
Resources, Inc.  

	 	
5525
Erindale Drive, Suite 201                   
Colorado Springs, Colorado 80918
                  
Attn:  Raymond E. McElhaney, President 

	 	
Synergy
Resources Corporation  

	 	
20203
Highway 60                   
Platteville, Colorado 80651                        
   and to
                  
600 17th Street, Suite 2800                   
Denver, Colorado 80202 

        9.09
    Binding Effect.   This Agreement shall inure to and be binding upon the heirs,
executors, personal representatives, successors and assigns of each of the parties to
this Agreement.  

        9.10
    Effect of Closing.   All representations, warranties, covenants, and
agreements of the parties contained in this Agreement, or in any instrument, certificate,
opinion, or other writing provided for in it, shall survive the closing of this Agreement,
provided however that after June 30, 2009 no action or proceeding may be instituted for
any breach of this Agreement. In the event there is any material misrepresentation or
warranty of any party to this Agreement, then Brishlin (if such misrepresentation is made
by the Synergy Principals) or the Synergy Shareholders (if such misrepresentation is made
by Brishlin or the Brishlin Principals) may rescind this Agreement during the 90 day
period following the closing of this Agreement. 

        9.11
    Mutual Cooperation.   The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement, and shall execute such other and further
documents and take such other and further actions as may be necessary or convenient to
effect the transaction described herein. Neither party will intentionally take any action,
or omit to take any action, which will cause a breach of such party’s obligations
pursuant to this Agreement. 

        9.12
    Expenses.   Each of the parties hereto agrees to pay all of its own expenses
(including without limitation, attorneys’ and accountants’ fees) incurred in
connection with this Agreement, the transactions contemplated herein and negotiations
leading to the same and the preparations made for carrying the same into effect. Each of
the parties expressly represents and warrants that no finder or broker has been involved
in this transaction and each party agrees to indemnify and hold the other party harmless
from any commission, fee or claim of any person, firm or corporation employed or retained
by such party (or claiming to be employed or retained by such party) to bring about or
represent such party in the transactions contemplated by this Agreement. 

15 

        AGREED
TO AND ACCEPTED as of the date first above written. 

	 	
BRISHLIN
RESOURCES, INC. 

	 	                                            By: 	 /s/ Raymond E. McElhaney
Raymond E. McElhaney, President 

	 	
Shareholders
of Synergy Resources Corporation  

	 	
1990
H & H FAMILY IRREVOCABLE TRUST 

	 	                                            By:  	/s/ Edward A. Holloway 
Trustee  

	 	
EACH
OF NINE, LLC 

	 	                                            By:  	/s/ Edward A. Holloway
Authorized
Officer  

	 	
PETROLEUM
MANAGEMENT, LLC 40lK 

	 	                                            By:  	
/s/ Edward A. Holloway

Edward
A. Holloway  

	 	
PETROLEUM
MANAGEMENT, LLC 401K 

	 	                                            By:  	
/s/ Renee Holloway

Renee Holloway  

	 	                                            SCAFF 	FAMILY
2008 IRREVOCABLE TRUST  

	 	                                            By:  	
/s/ William E. Scaff Jr.
Trustee  

                                     16 

	 	
DELL
T. BEANS FAMILY TRUST 

	 	                                            By:  	/s/ William E. Scaff Jr.
Trustee 

	 	
MY
WAY LLC  

	 	                                            By:  	/s/ William E. Scaff Jr.
Authorized
Officer 

	 	
STAIANO
FAMILY LLC  

	 	                                            By:  	/s/ John Staiano
Authorized
Officer 

	 	
STAIANO
FAMILY 2008 IRREVOCABLE TRUST 

	 	                                            By:  	/s/ John Staiano
Trustee 

	 	
QUEENSTOWN
INVESTMENT TRUST 

	 	                                            By:  	/s/ John P. Barton
Trustee 

	 	
CAMBRIDGE
ENERGY PARTNERS 

	 	                                            By:  	/s/ John P. Barton
Authorized
Officer 

17 

	 	
STRATEGIC
CAPITAL PARTNERS  

	 	                                            By:  	/s/ Benjamin Barton
Authorized
Officer 

	 	
SYNERGY
ENERGY TRUST  

	 	                                            By:  	/s/ John Barton
Trustee 

	 	
/s/ Val Dunn
Val
Dunn 

	 	
/s/ Rick Wilber

Rick
Wilber 

	 	
/s/ Craig Bardmen

Craig Bardmen 

	 	
/s/ Steve Paoletti

Steve Paoletti 

	 	
/s/ Brian Meserlian

Brian Meserlian 

	 	
/s/ William Coleman

William Coleman 

	 	
/s/ Hal Lapping

Hal Lapping 

	 	
/s/ Larry Benson

Larry Benson 

18 

	 	
/s/ John Crowley

John Crowley 

	 	
/s/ Robert Lavin

Robert Lavin 

	 	
/s/ Michael Williams

Michael Williams 

	 	
Principals
of Synergy Resources Corporation  

	 	
/s/ Ed Holloway

Ed Holloway 

	 	

/s/ William E. Scaff, Jr.

William E. Scaff, Jr. 

	 	
/s/ John Barton

John Barton 

	 	
/s/ Benjamin Barton

Benjamin Barton 

	 	
Principals
of Brishlin Resources, Inc.  

	 	
/s/ Bill Conrad

Bill Conrad 

	 	
/s/ Raymond McElhaney

Raymond McElhaney 

19 

EXHIBIT A 

OPTIONS, WARRANTS AND
CONVERTIBLE SECURITIES 

        2,060,000
outstanding Series A warrants. 

        Each
Series A Warrant entitles the holder to purchase one share of Synergy’s common stock
at a price of $6.00 per share. The Series A Warrants expire on the earlier of December 31,
2012 or twenty days following written notification from Synergy that its common stock had
a closing bid price at or above $7.00 for any ten of twenty consecutive trading days. 

        Synergy
has issued options to the persons, in the amounts and for the consideration shown below: 

	Name
		Shares Issuable

Upon Exercise

of Options
		Exercise

Price
		Expiration

Date
	
	Each of Nine, LLC	 	 	 	1,000,000	 	$1.00	     	6-11-13	 	 	 
	My Way, LLC	 	 	 	1,000,000	 	$1.00	     	6-11-13
	Each of Nine, LLC	 	 	 	1,000,000	 	$10.00	    	6-11-13
	My Way, LLC	 	 	 	1,000,000	 	$10.00	    	6-11-13

        Each
of Nine, LLC is controlled by Ed Holloway.  My Way, LLC is controlled by William E.
Scaff, Jr. 

EXHIBIT P  

ACQUISITION PLAN 

(Letter of Intent) 

SYNERGY RESOURCES
CORPORATION                                           
  600 17th Street, 2800 South

                                               Denver, Colorado 80202

                                                  (720) 359-1591 

August 07, 2008 

Ed Holloway
Petroleum Management
LLC 
20203 Highway 60 
Platteville, CO 80651 

	 	Re:  	Proposed
Assignment of Oil and Gas Interests  

Dear Mr.Holloway, 

        The
purpose of this letter is to summarize the principal terms pursuant to which it is
intended Synergy Resources Corporation (SRC) will acquire certain working interests in
certain oil and gas leases in Weld County, Colorado from Petroleum Management, LLC and/or
Petroleum Exploration & Management, LLC (collectively “PM”). This letter
sets forth the principal terms of such agreement as follows: 

	1. 	Oil
and Gas Working Interests/ Prospects Available for Assignment.   PM has
certain working interests available for assignment to SRC, subject to the conditions set
forth herein, and such working interests shall be made available for assignment if the
conditions are met by Synergy. The properties under lease (‘“Prospects”)
and available for working interest ownership assignment are attached as Exhibit A. The
conditions of the parties entering into an Assignment of Oil and Gas Interests are as
follows:  

	 	a.  	SRC
has successfully completed its merger with Brishlin and additional funding
               in the amount of a sale of 2,000,000 shares at $3.50 each (total $7
million                minimum).  

	 	b.  	This
funding occurs on or before November 1, 2008.  

	 	c.  	If
only partial funding is accomplished by SRC, then a reduced percentage of
               working interest ownership may be reflected in the Assignment, subject to
both                parties’ approval. Pending the November 1, 2008 deadline, PM
will not sell                or assign the interest set forth on Exhibit A to any other
third party. All of                the working interests conveyed will be at a 75% net
revenue interest and a                $1,000 lease cost per net acre. The percentage of
working interest ownership may                vary with each Prospect. Additional
Prospects may be made available with                additional funding received by
Synergy.  

    2.        Deposit.
  In order to hold this working interest SRC will deliver, at the
          signing of this letter, $100,000.00 in certified funds or by wire transfer to
PM           These funds are refundable, and if the transaction contemplated herein does
not           occur, these monies will be returned to SRC. If the transaction
contemplated           herein does occur, then this amount shall be applied to the
purchase price of           the Assignment of Oil and Gas Interests.  

    3.        Assignment
of Oil and Gas Interests.   Immediately upon execution of this
          Letter of Intent, the Parties shall diligently cause to be prepared a form of
          Assignment of Oil and Gas Interests (“Assignment”) on or before
          November 1, 2008, containing provisions in accordance with the foregoing,
          together with such other appropriate terms and conditions as are customary in
          such assignments. The Assignment shall be recorded in the records of the Clerk
          and Recorder of Weld County, Colorado, upon closing. The Assignment shall also
          provide that, pending the closing date, SRC and its representatives shall at
all           times have access to all pertinent data and other information as its
          representatives shall request from time to time.  

    4.        Confidentiality.  It
is, of course, understood that all access,           investigations and contact to be
conducted by either party or its           representatives shall be conducted and
maintained in strict confidence, and           should the transactions contemplated by
this Letter of Intent not be completed           for any reason whatsoever, each party
and its representatives shall keep           confidential any information concerning the
others’ operations and business           and shall return all documentation to the
originating party.  

    5.
        Conditions.  The
Assignment shall provide that the obligations of SRC and           PM are expressly
subject to, among other provisions, the following:  

	 	(a)  	Review
and approval of the Assignment by the respective Boards of Directors of           SRC and
PM;  

	 	(b)  	A
favorable review by counsel of the good and marketable title of PM to the
          Prospects listed on Exhibit A;  

	 	(c)  	The
receipt by each Party of a favorable opinion of counsel to the other           relating
to such matter as are customarily delivered in connection with the           Assignment
contemplated hereby;  

	 	(d)  	The
completeness and accuracy at all times up to and including the closing, of           the
representations, warranties, agreements and covenants of the Parties as
          contained in the Assignment; and  

    
6.       Expiration.  
This Letter of intent shall expire on the earliest to occur           of the following
events:  

	 	(a) 	         The
effective date of the Assignment;  

	 	(b)  	November
1, 2008; or  

	 	(c)  	                 The
date of termination of this Letter of Intent by the mutual consent of PM           and
SRC in writing.  

    7.
       
Miscellaneous.
  PM and SRC agree to diligently and timely negotiate in good faith toward a
definitive Assignment satisfactory to each Party. During the term
following execution of this Letter of Intent and until the Letter of
Intent is terminated as provided herein, PM shall not enter into or
otherwise undertake negotiations or execute agreements pertaining to the
Assignment of this working interest with any third party. It is, of
course, understood that this Letter of Intent is intended to be, and shall
be construed only as, a statement of intent summarizing and evidencing the
discussions between the Parties and is not an agreement with respect to
the transactions contemplated hereby and is not binding on either Party
until the Assignment is executed and delivered by the Parties and at that
time, the respective rights and obligations of the Parties shall be only
as defined in the Assignment; provided, however, that the respective
obligations of SRC and PM under paragraphs 3, 4, 5 and 6 shall be binding
upon you and us when this Letter of Intent is executed by you and returned
to us.  

    
8.       Costs.  
Whether or not the transactions contemplated hereby are           consummated, each Party
shall pay its own costs in connection with this Letter           of Intent and the
obligations contemplated thereby.  

        If
the foregoing meets with your approval, please execute it on behalf of the Company and
return the duplicate to us, whereupon the letter shall constitute the Letter of Intent
between us in accordance with the terms and conditions set forth above. We agree that
facsimile signatures shall have the same force and effect as originals for all purposes
intended hereby. 

	 	
Respectfully
submitted,

	 	
SYNERGY
RESOURCES CORPORATION

	 	
By: /s/ William
Scaff
William
Scaff, Vice President 

	 	
PETROLEUM
MANAGEMENT LLC

	 	
By: /s/ Edward
Holloway
Edward
Holloway, Managing Member 

EXHIBIT A —
Prospects  

Oil and Gas Leases currently owned by
PM or its affiliates as to the following property: 

	 	1. 	          South
 1⁄2 of Section 16, Township 4 North, Range 67 West, Weld           County,
Colorado.  

	 	2.  	Northwest
1⁄4 of Section 21, Township 5 North, Range           66 West, Weld County, Colorado.  

	 	3.  	Northwest
1⁄4 of Section 4, Township 5           North, Range 66 West, Weld County, Colorado.Exhibit 10.1

 

PROMISSORY
NOTE SECURED BY DEED OF TRUST

 

	
  $27,250,000.00

  	
   

  	
  August 22,
  2008

  

 

FOR VALUE
RECEIVED, FLEETWOOD MOTOR HOMES OF
CALIFORNIA, INC., a California corporation (“Riverside Borrower”) and FLEETWOOD HOMES OF CALIFORNIA, INC., a
California corporation (“Woodland Borrower”,
together with Riverside Borrower, collectively and in the singular and jointly
and severally, “FLE Borrower”),
promises to pay to ISIS LENDING, LLC,
a Delaware limited liability company (“Lender”),
or order, as hereinafter provided, the principal sum of Twenty Seven Million
Two Hundred Fifty Thousand and No/100 Dollars ($27,250,000.00)  (“Principal
Sum”), plus interest on the unpaid principal balance thereof
payable at the Interest Rate (defined below).

 

1.             Definitions.

 

(a)           “2 Year Treasury Rate” means, as of any
date of determination, as determined by Lender, the annual percentage yield on
U.S. Treasury securities maturing two (2) years from such date of
determination (the “Annual Treasury
Instrument Yield”).  The
Lender shall base its determination of the Annual Treasury Instrument Yield on
the yield on U.S. Treasury instruments, as published in The Wall Street Journal
(or, if The Wall Street Journal is not then being published or if no such
reports are then being published in The Wall Street Journal, as reported in
another public source of information nationally recognized for accuracy in the
reporting of the trading of governmental securities).  If no such instruments mature on the exact
second (2nd) year anniversary of such date of determination, the
Lender shall interpolate the Annual Treasury Instrument Yield on a
straight-line basis using the yield on the instrument whose maturity date most
closely precedes the second (2nd) yearly anniversary of such date of
determination, and the yield on the instrument whose maturity date most closely
succeeds the second (2nd) yearly anniversary of such date of
determination.

 

(b)           “Business Day” means any day except
Saturdays, Sundays and days on which banks in San Francisco, California are
required to be closed pursuant to federal or state law.

 

(c)           “Closing Date” means the date of
recordation of the Deed of Trust in the appropriate public records where each
of the Riverside Property and Woodland Property is located.

 

(d)           “Deed of Trust” means collectively as
referred to herein from time to time, the Riverside Deed of Trust, and the
Woodland Deed of Trust, as each may be modified, amended or supplemented from
time to time

 

(e)           “Default Rate” shall have the meaning
set forth in Section 13 below.

 

(f)            “Excess Interest” shall have the meaning
set forth in Section 18 below.

 

(g)           “Exit Fee” shall have the meaning set
forth in Section 4 below.

 

(h)           “Extended Maturity Date” means, (i) with
respect to the exercise of the first Extension Option, if applicable, the
fourth (4th) yearly anniversary of the date of this Note, and (ii) with
respect to the exercise of the second Extension Option, if applicable, the
fifth (5th) yearly anniversary of the date of this Note.

 

(i)            “Extension Period” shall have the
meaning set forth in Section 3 below.

 

(j)            “Extension Option” shall have the
meaning set forth in Section 3 below.

 

(k)           “FLE Borrower” shall have the meaning
set forth in the preamble above.

 

1

 

(l)            “Initial Term” shall mean the period
commencing as of the date hereof and through and including the Maturity Date.

 

(m)          “Interest Rate” shall mean (i) during
the Initial Term, a rate equal to Nine and Ninety Five Hundredths of One
Percent (9.95%) and (ii) during any Extension Period, the higher of (a) Nine
and Ninety Five Hundredths of One Percent (9.95%) or (b) the 2 Year
Treasury Rate plus five percent (5.00%) per annum.

 

(n)           “Lender” shall have the meaning set
forth in the preamble above.

 

(o)           “Loan” shall have the meaning set forth
in Section 2 below.

 

(p)           “Maturity Date” means the third (3rd)
yearly anniversary of the date of this Note.

 

(q)           “Note” means this Promissory Note
Secured by the Riverside Deed of Trust and the Woodland Deed of Trust, as may be
modified, amended or supplemented from time to time.

 

(r)           “Origination Fee” shall have the meaning
set forth in Section 4 below.

 

(s)           “Prepayment Fee” shall have the meaning
set forth in Section 14 below.

 

(t)            “Principal Sum” shall have the meaning
set forth in the preamble above.

 

(u)           “Property” means, collectively, the
Riverside Property and the Woodland Property; those certain real properties
located in the Counties of Riverside and Yolo, respectively, State of
California, and each of which more particularly described on Exhibit A
to the Riverside Deed of Trust and Woodland Deed of Trust, respectively.

 

(v)            “Riverside Deed of Trust” means that
certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and
Fixture Filing of even date herewith executed by Riverside Borrower, for the
benefit of Lender, covering certain real property described in Exhibit A
therein, situated in the County of Riverside, State of California, as the same
may be modified, amended or supplemented from time to time.

 

(w)           “Riverside Property” shall mean those
certain real properties, each located in the County of Riverside, State of
California, which are located at the following addresses, each of which is more
particularly described on Exhibit A to the Riverside Deed of Trust:

 

(i)            2350
Fleetwood Drive, Riverside, California (“Riverside
Fleetwood Property”);

 

(ii)           5300
Via Ricardo (“Riverside Via Ricardo
Property”); and

 

(iii)         5425
Wilson Street (“Riverside Wilson Property”).

 

(x)           “Woodland Deed of Trust” means that certain
Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture
Filing of even date herewith executed by Woodland Borrower, for the benefit of
Lender, covering certain real property described in Exhibit A
therein, situated in the County of Yolo, State of California, as the same may
be modified, amended or supplemented from time to time.

 

(y)           “Woodland Property” shall mean that
certain real property located in the County of Yolo, State of California, and
more particularly described on Exhibit A to the Woodland Deed of
Trust.

 

2

 

2.             Payment of Interest and Principal.  Interest payable under this Note shall be
equal to the interest accruing from time to time at the Interest Rate (or if
and when applicable hereunder, the Default Rate) on the principal balance from
time to time outstanding under this Note from and after the date of this Note
until paid in full.  Interest shall be
payable at closing for the period from the date of this Note up to the first (1st)
day of the first (1st) calendar month following the Closing
Date.  Commencing on the first (1st)
day of the second (2nd) calendar month following the Closing Date,
and on the first (1st) day of each calendar month thereafter through
the initial Maturity Date, FLE Borrower shall pay to Lender a monthly payment
of principal and interest in an amount equal to Two Hundred Forty One Thousand
Fifty Five and 56/100 Dollars ($241,055.56). 
Such monthly payment shall be applied first to any accrued and unpaid
interest and thereafter to principal.  In
the event that the initial Maturity Date is extended for one or more Extension
Periods as provided in Section 3 below, the amount of the monthly payment
shall be adjusted as determined by Lender to reflect any increase in the
applicable Interest Rate and FLE Borrower shall pay the amount of such adjusted
monthly payments.  Following the Maturity
Date, or Extended Maturity Date, as applicable, or otherwise as provided in Section 13
hereof, interest shall accrue under this Note at the Default Rate.  If not sooner paid, the balance of the
principal and all accrued and unpaid interest shall be all due and payable on
the Maturity Date, or, if earlier, upon any earlier of the date of acceleration
of the indebtedness evidenced by this Note (“Loan”) pursuant to the terms of this Note or each of the
Riverside Deed of Trust and Woodland Deed of Trust (as each is defined
below).  FLE Borrower acknowledges that,
since the term of the Loan is shorter than the amortization period, a
substantial portion of the principal balance will be due on the Maturity Date
or the Extended Maturity Date, as applicable, or if earlier, upon any earlier
of the date of acceleration of the Loan pursuant to the terms of this Note or
each respective Deed of Trust.  Interest accrued hereunder shall be payable
on demand and shall be calculated on the basis of the actual number of days
elapsed on a three hundred sixty (360) day year, which results in higher
interest than if a three hundred sixty five (365) day year were used.

 

3.             Extension Option.  FLE Borrower shall have the option to extend
the term of the Loan beyond the initial Maturity Date for two (2) successive
terms (each, an “Extension Option”)
of one (1) year each (each, an “Extension
Period”) on the terms and conditions set forth herein.  In order to exercise each Extension Option, (i) no
default shall have occurred and be continuing under this Note or the Deed of
Trust, (ii) FLE Borrower must deliver to Lender irrevocable written notice
of the election to exercise each Extension Option not less than forty-five (45)
days nor more than ninety (90) days prior to the Maturity Date, and (iii) FLE
Borrower must pay to Lender an extension fee equal to One Half of One Percent
(0.5%) of the then-outstanding principal amount of the Loan prior to the
commencement of each applicable Extension Period.  If FLE Borrower fails to exercise either
Extension Option strictly in accordance with the provisions of this Section 3,
then such Extension Option shall automatically cease and terminate.

 

4.             Origination Fee; Exit Fee.  Upon execution of this Note and the Deed of
Trust, FLE Borrower shall pay to Lender a non-refundable loan origination fee
(the “Origination Fee”) in
an amount equal to One and One Quarter of One Percent (1.25%) on the Principal
Sum, which FLE Borrower acknowledges is reasonable under the circumstances and
is fully earned by Lender upon receipt. 
From and after the date of this Note there is owing an exit fee in an
amount equal to Three Quarters of One Percent (0.75%) of the Principal Sum (“Exit Fee”), which Exit Fee is payable
on the earliest to occur of (i) payment or prepayment of the Loan in full,
(ii) the Maturity Date or Extended Maturity Date, as applicable, or (iii) acceleration
of this Note; provided  that, if from time to time FLE Borrower
shall make any partial payment of principal then outstanding under the Loan
(other than partial payments of principal consisting of scheduled monthly
principal amortization payments), then concurrently with such partial payment,
FLE Borrower shall be obligated to pay to Lender, in respect of FLE Borrower’s
Exit Fee payment obligation, an amount equal to the product of (x) the
amount of the partial principal payment so paid, times (y) Three Quarters
of One Percent (3/4%), which Exit Fee payment(s) made by FLE Borrower
shall be credited against FLE Borrower’s Exist Fee obligations owing to
Lender.  The Exit Fee is in addition to
any Prepayment Fee.

 

5.             Security for the Loan.  The Loan and the obligations created
hereunder are secured by, among other things, (i) that certain Deed of
Trust, Assignment of Rents, Security Agreement and Fixture Filing of even date
herewith executed by Riverside Borrower in favor of Lender (as the same may be
modified, amended or supplemented from time to time, the “Riverside Deed of Trust”) and (ii) that
certain Deed of Trust, Assignment of Rents, Security Agreement and Fixture
Filing of even date herewith executed by Woodland Borrower in favor of Lender
(as the same may be modified, amended or supplemented from time to time, the “Woodland Deed of Trust”; the Riverside
Deed of Trust and the Woodland Deed of Trust, as each may be modified, amended
or 

 

3

 

supplemented from time to
time hereafter, are sometimes hereinafter referred to individually and
collectively as the “Deed of Trust”)  The Deed of Trust, together with this Note,
and all other documents to or of which Lender is a party or beneficiary now or
hereafter evidencing, securing, guaranteeing, modifying or otherwise relating
to the indebtedness evidenced hereby, are herein referred to collectively as
the “Loan Documents”.  All of the terms of the Loan Documents are
incorporated herein by reference.  Some
of the Loan Documents are to be filed for record on or about the date hereof in
the appropriate public records.

 

6.             Application of Payments.  All payments on this Note shall be applied
first to the payment of any expenses incurred and/or protective advances made
by the Lender, then to any exit fees and/or prepayment fees then due and
unpaid, then to accrued and unpaid interest, and after all such interest has
been paid, any remainder shall be applied toward reduction of the principal
balance; provided, however, upon the occurrence of an Event of Default, Lender
at its option, may apply any and all payments under this Note to the
indebtedness evidenced by this Note in such order of application and priority
as Lender shall determine in its sole discretion.  FLE Borrower shall pay to Lender any amounts
outstanding under this Note on the Maturity Date, or the extended Maturity
Date, as applicable, or upon earlier acceleration of the outstanding
indebtedness evidenced by this Note, including, without limitation, any accrued
and unpaid interest under this Note, so that all principal, interest and any
other amounts outstanding under this Note are paid in full on or before the
Maturity Date, or the extended Maturity Date, as applicable, or upon earlier
acceleration of the outstanding indebtedness evidenced by this Note,.  All amounts payable hereunder are payable in
lawful money of the United States.

 

7.             Late Fee.  FLE Borrower acknowledges that if (i) any
monthly payment of principal and interest required under this Note is not paid
on or before ten (10) days following the date the same becomes due and
payable or if (ii) any other payment required under this Note is not paid
on or before the date when the same becomes due and payable, the holder hereof
will incur extra administrative expenses (i.e.,
in addition to expenses incident to receipt of timely payment) and the loss of
the use of funds in connection with the delinquency in payment.  FLE Borrower further acknowledges that due to
the nature of the transaction, the actual damages suffered by the holder hereof
by reason of such extra administrative expenses and loss of use of funds would
be impracticable or extremely difficult to ascertain.  Therefore, FLE Borrower shall, in the event
of a delinquency, without further notice, pay to the holder hereof to cover
such extra administrative expenses and loss of use of funds, a late fee in the
amount of five percent (5%) of the amount of such delinquent payment, excluding
any delinquent balloon payments.  The
provisions of this Section 7 are intended to govern only the
determination of damages in the event of a breach in the performance of the
obligation of FLE Borrower to make timely payments hereunder.  Nothing in this Note shall be construed as an
express or implied agreement by the holder hereof to forbear in the collection
of any delinquent payment, or be construed as in any way giving FLE Borrower
the right, express or implied, to fail to make timely payments hereunder,
whether upon payment of such damages or otherwise.  The right of the holder hereof to receive
payment of such liquidated and actual damages, and receipt thereof, are without
prejudice to the right of such holder to collect such delinquent payments and
any other amounts provided to be paid hereunder or under any security for this
Note or to declare a default hereunder or under any security for this
Note.  FLE Borrower further agrees that
an amount equal to the late charge described in this Note is a reasonable
estimate of the damage to Lender in the event of a late payment.  Nothing in this Note shall be construed as an
obligation on the part of Lender to accept, at any time, less than the full
amount then due hereunder, or as a waiver or limitation of Lender’s right to
compel prompt performance.

 

8.             Acceleration.  Upon default by FLE Borrower in the payment
or performance of any agreement secured by the Deed of Trust, Lender may, at
any time thereafter, together or singly,

 

(a)           declare the entire
outstanding principal balance due under this Note, together with all accrued
and unpaid interest thereon, to be immediately due and payable, thereby
accelerating this Note, and/or

 

(b)           exercise immediately
and without notice, any and all other rights and remedies available under this
Note and/or the Deed of Trust or at law or in equity.

 

9.             Delivery of Payment.  All payments on this Note are to be made or
given to the holder hereof whose address for this purpose is as specified in
the Deed of Trust, or to such other person or at such other place as the holder
hereof may from time to time direct by written notice to FLE Borrower.  At Lender’s election, in its sole and
absolute discretion, Lender may credit the Origination Fee to be paid by FLE
Borrower upon the execution of this Note and the Deed of Trust against amounts
to be disbursed by Lender under this Note.

 

4

 

10.          Waiver of Offset Right.  FLE Borrower waives any right of offset it
now has or may hereafter have against the holder hereof and agrees to make the
payments called for hereunder in accordance with the terms hereof.  The holder hereof shall have all the rights
of a holder in due course as provided in the California Uniform Commercial Code
and other laws of the State of California.

 

11.          Additional Waivers.  FLE Borrower and any endorsers, guarantors or
sureties hereof jointly and severally waive presentment and demand for payment,
notice of intent to accelerate maturity, protest or notice of protest or
non-payment, bringing of suit and diligence in taking any action to collect any
sums owing hereunder or in proceeding against any of the rights and properties
securing payment hereunder; expressly agree that this Note, or any payment
hereunder, may be extended from time to time; and consent to the acceptance of
further security or the release of any security for this Note, all without in
any way affecting the liability of FLE Borrower and any endorsers or guarantors
hereof.  No extension of time for the
payment of this Note, or any installment hereof, made by agreement by the
holder hereof with any person now or hereafter liable for the payment of this
Note, shall affect the original liability under this Note of FLE Borrower,
whether FLE Borrower is or is not a party to such agreement.  If FLE Borrower consists of more than one
person or entity, their obligations hereunder shall be joint and several.

 

12.          Lender Remedies.  Lender may enforce the liability and
obligation of FLE Borrower to perform and observe the obligations contained in
this Note by bringing a foreclosure action, an action for specific performance
or any other appropriate action or proceeding at law or equity to enable Lender
to enforce any and all rights under this Note or the Deed of Trust or any other
document, instrument and/or agreement relating to the Loan, against FLE
Borrower and/or any guarantor, and/or indemnitor, and/or in respect of the
Property and any other collateral given to Lender pursuant hereto or the Deed
of Trust.

 

13.          Default Interest.  The failure of FLE Borrower to pay or perform
as required hereunder or the default of FLE Borrower under the Deed of Trust
shall constitute a default hereunder. 
Upon the occurrence of a default hereunder, at the option of the holder
hereof, all amounts then outstanding under this Note and the Deed of Trust
shall bear interest for the period beginning with the date of occurrence of
such default at a default interest rate (the “Default Rate”) equal to the sum of the Interest Rate plus
Five Percent (5%) per annum  and,
in addition, such holder may, at its option, declare immediately due and owing
the entire unpaid principal sum together with all interest accrued and unpaid
or otherwise owing thereon, plus any other sums owing at the time of such
declaration pursuant to this Note and the Deed of Trust.

 

The failure to
exercise the foregoing option shall not constitute a waiver of the right to
exercise the same at any subsequent time in respect of the same event or any
other event.  The acceptance by the
holder hereof of any payment hereunder which is less than payment in full of
all amounts due and payable at the time of such payment shall not constitute a
waiver of the right to exercise any of the foregoing options at that time or at
any subsequent time or nullify any prior exercise of any such option without
the express written consent of such holder, except as and to the extent
otherwise provided by law.

 

14.          Prepayment.

 

(a)           The
outstanding principal balance of this Note and the interest accrued and unpaid
and otherwise owing may be prepaid in full, but not in part, at any time; provided,
however, (i) FLE Borrower shall be entitled to make a partial
prepayment of the Loan solely upon the sale and transfer of one or more of the
Woodland Property or the Riverside Fleetwood Property, the Riverside Via
Ricardo Property or the Riverside Wilson Property, if and when permitted
pursuant to Section 30 of the respective Deed of Trust and (ii) (A) in
each case, if such partial prepayment shall be made anytime during the period
commencing as of the date hereof through and including the one (1) year
anniversary of the Closing Date, the FLE Borrower shall pay to Lender, in
addition to the Exit Fee set forth in Section 4 above, a fee equal
to the product of the then outstanding principal amount so prepaid on such
prepayment date times Three Percent (3.0%), (B) if any portion of the Loan
is paid off anytime during the period commencing the day after the one (1) year
anniversary of the Closing Date through and including the two (2) year
anniversary of the Closing Date, the FLE Borrower shall pay to Lender, in
addition to the Exit Fee set forth in 

 

5

 

Section 4
above, a fee equal to the product of the then outstanding principal amount so
prepaid on such prepayment date times Two Percent (2.0%), and (B) if any
portion of the Loan is paid off anytime during the period commencing the day
after the two (2) year anniversary of the Closing Date through but
excluding the Maturity Date, the FLE Borrower shall pay to Lender, in addition
to the Exit Fee set forth in Section 4 above, a fee equal to the
product of the then outstanding principal amount so prepaid on such prepayment
date times Three Quarters of One Percent (0.75%), (each of the prepayment fees
referred to in (i) through (iii), individually, a “Prepayment Fee” and collectively, the “Prepayment Fees”).  No Prepayment Fee shall be due and payable in
connection with any prepayment of the Loan by FLE Borrower during any Extension
Period.  Any prepayment of this Note
shall include all interest accrued and unpaid or otherwise owing to Lender.

 

(b)           TO
THE FULLEST EXTENT PERMITTED BY LAW, FLE BORROWER HEREBY EXPRESSLY (I) WAIVES
ANY RIGHTS IT MAY HAVE UNDER CALIFORNIA CIVIL CODE SECTION 2954.10 TO
PREPAY THIS NOTE, IN WHOLE OR IN PART, WITHOUT PREMIUM OR PENALTY, UPON
ACCELERATION OF THE MATURITY DATE, AND (II) AGREES THAT (A) THE
AMOUNT DUE AND OWING UNDER THIS NOTE UPON ACCELERATION OF THE MATURITY DATE
SHALL INCLUDE THE AMOUNT OF ANY PREPAYMENT PREMIUM THAT WOULD BE DUE AND OWING
BY FLE BORROWER TO LENDER IF THE PRINCIPAL AMOUNT OF THE NOTE WERE PREPAID IN
FULL ON THE DATE OF SUCH ACCELERATION AND (B) IF, FOR ANY REASON, A
PREPAYMENT OF ALL OR ANY PORTION OF THE PRINCIPAL AMOUNT OF THIS NOTE IS MADE
UPON OR FOLLOWING ANY ACCELERATION OF THE MATURITY DATE BY LENDER ON ACCOUNT OF
ANY DEFAULT BY FLE BORROWER INCLUDING, WITHOUT LIMITATION, ANY TRANSFER,
DISPOSITION, OR FURTHER ENCUMBRANCE PROHIBITED OR RESTRICTED BY THE DEED OF
TRUST, THEN FLE BORROWER SHALL BE OBLIGATED TO PAY (I) ANY AND ALL
OUTSTANDING INDEBTEDNESS EVIDENCED BY THIS NOTE AND (II) CONCURRENTLY WITH
SUCH PREPAYMENT THE PREPAYMENT PREMIUM SPECIFIED IN THIS NOTE.  BY INITIALING THIS PROVISION IN THE SPACE
PROVIDED BELOW, FLE BORROWER HEREBY DECLARES THAT THE AGREEMENT TO MAKE THE
LOAN EVIDENCED BY THIS NOTE AT THE INTEREST RATE AND FOR THE TERM SET FORTH IN
THIS NOTE CONSTITUTES ADEQUATE CONSIDERATION, GIVEN INDIVIDUAL WEIGHT BY FLE
BORROWER FOR THIS WAIVER AND AGREEMENT.

 

                      FLE
Borrower’s Initials:                      .

 

15.          Waiver.  FLE Borrower, for itself and all endorsers,
guarantors and sureties of this Note, and each of them, and their heirs, legal
representatives, successors and assigns, respectively hereby waives presentment
for payment, demand, notice of nonpayment, notice of dishonor, protest of any
dishonor, notice of protest and protest of this Note, and all other notices in
connection with the delivery, acceptance, performance, default or enforcement
of the payment of this Note, and agrees that its liability shall be unconditional
and without regard to the liability of any other party and shall not be in any
manner affected by any indulgence, extension of time, renewal, waiver or
modification granted or consented to by the Lender.  FLE Borrower, for itself and all endorsers,
guarantors and sureties of this Note, and each of them, and their heirs, legal
representatives, successors and assigns, respectively hereby consents to every
extension of time, renewal, waiver or modification that may be granted by
Lender with respect to the payment or other provisions of this Note, and to the
release of any collateral given to secure the payment hereof, or any part
hereof, with or without substitution, and agrees that additional makers or
guarantors or endorsers may become parties hereto without notice to FLE
Borrower and without affecting the liability of FLE Borrower hereunder.

 

16.          No Assignment by FLE Borrower; Successors and
Assigns.  FLE Borrower’s
obligations under this Note may not be assigned, transferred or delegated
without Lender’s express prior written consent, which consent may be withheld
in Lender’s sole and absolute discretion. 
Subject to the foregoing restriction on FLE Borrower’s right to assign
this Note, this Note binds FLE Borrower and its successors, assigns, heirs,
administrators, executors, agents and representatives and inures to the benefit
of Lender and its successors, assigns, heirs, administrators, executors, agents
and representatives.

 

6

 

17.          Collection Costs/Attorneys’ Fees.  In the event of default, FLE Borrower agrees
to pay all costs of collection when incurred, including reasonable attorneys’
fees, costs and expenses whether or not an action shall be instituted to
enforce this Note, except that solely with respect to litigation between Lender
and FLE Borrower with respect to the Loan, if and to the extent that applicable
law requires, the legal fees of the prevailing party in such litigation shall
be paid by the unsuccessful party to such litigation.  Such attorneys’ fees, costs and expenses
shall include post-judgment fees, costs and expenses incurred on appeal or in
collection of any judgment.  This
provision is separate and several and shall survive the merger of this Note into
any judgment on this Note.

 

18.          Maximum Interest Rate.  In no event whatsoever shall the amount of
interest paid or agreed to be paid to Lender pursuant to this Note or the Deed
of Trust exceed the highest lawful rate of interest permissible under
applicable law.  If, from any circumstances
whatsoever, fulfillment of any provision of this Note and the Deed of Trust
shall involve exceeding the lawful rate of interest which a court of competent
jurisdiction may deem applicable hereto (“Excess Interest”),
then the obligation to be fulfilled shall be reduced to the highest lawful rate
of interest permissible under such law and if, for any reason whatsoever,
Lender shall receive as interest an amount which would be deemed Excess
Interest, such Excess Interest shall be applied to the unpaid principal balance
of this Note (whether or not due and payable) and not to the payment of
interest, or refunded to FLE Borrower if this Note has been paid in full.  Neither FLE Borrower nor any guarantor or
endorser shall have any action against Lender for any damages whatsoever
arising out of the payment or collection of any such Excess Interest.

 

19.          Severability; Invalid Provisions; Headings.  Each provision of this Note shall be
severable from every other provision of this Note for the purpose of determining
the legal enforceability of any specific provision.  If any provision of this Note is held to be
invalid, illegal or unenforceable for any reason, such invalidity, illegality
or unenforceability will not affect any other provisions of this Note, and this
Note will be construed as if such invalid, illegal or unenforceable provision
had never been contained herein. 
Headings are for reference purposes only and in no way define, limit,
construe or describe the scope or extent of such section.

 

20.          General.  This Note shall be governed by and construed
according to the laws of the State of California except as such laws are
preempted by federal law.  Time is of the
essence of this Note and the performance of each of the covenants and
agreements contained herein.  If any
payment to be made by FLE Borrower shall otherwise become due on a national
holiday, such payment shall be made on the next succeeding business day and
such extension of time shall be included in computing any interest in respect
of such payment.

 

21.          Amendments.  This Note may not be terminated or amended
orally, but only by a termination or amendment in writing signed by Lender.

 

[SIGNATURES
TO APPEAR ON FOLLOWING PAGE]

 

7

 

IN WITNESS WHEREOF,
FLE Borrower has executed this Note or has caused the same to be executed by
its duly authorized representative(s) as of the date first set forth
above.

 

	
   

  	
  FLE BORROWER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FLEETWOOD HOMES OF
  CALIFORNIA, INC., a 

  California corporation

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/ Boyd R. Plowman

  
	
   

  	
  Name:

  	
   

  	
  Boyd R. Plowman

  
	
   

  	
  Title: 

  	
  Executive Vice
  President and 

  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  FLEETWOOD MOTOR HOMES
  OF CALIFORNIA, INC., 

  a California corporation

  
						

 

	
   

  	
  By: 

  	
   

  	
  /s/ Boyd R. Plowman

  
	
   

  	
  Name:

  	
   

  	
  Boyd R. Plowman

  
	
   

  	
  Title: 

  	
  Executive Vice
  President and 

  Chief Financial Officer

  
					

 

S-1

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