Document:

RELEASE
      AND SETTLEMENT AGREEMENT- LARSON

     

     

    THIS
      RELEASE AND SETTLEMENT AGREEMENT (this “Agreement”)
      is
      made and entered into as of this 11th day of July 2007 by and among
      Indigo-Energy, Inc., a Nevada corporation (the “Company”)
      and
      Appalachian Technology and Transportation, Inc., a corporation; and David Larson
      collectively referred to as Contractor (“Contractor”),
      and
      the leadership of the majority interest of Indigo-Energy Partners, LP, (“LP”)
      together with the Company, the “Parties”
each
      a
“Party”).
      

     

    WHEREAS,
      reference is made to a number of Employment Agreements (Original Agreement)
      between the Parties for the Contractor to provide services in exchange for
      fees
      and the issuance of stock. pursuant to which the Company and Contractor had
      agreed to certain terms and conditions, and more specifically, Company issued
      to
      Appalachian Technology and Transportation, Inc. ten million (10,00,000) shares
      of Indigo common stock (“Stock”) for future services to be performed by
      Contractor as described in Original Agreement;, and

     

    WHEREAS,
      the
      Parties have agreed that it is in their best interests to modify the terms
      relating to the Original Agreement pursuant to the terms set forth herein;
      and

     

    WHEREAS,
      the Company has offered and the Contractor has agreed to accept such
      modifications to the Original Agreement for services rendered pursuant to the
      terms set forth herein; and

     

    WHEREAS,
      the Contractor has agreed that acceptance of such modifications to the Original
      Agreement shall constitute payment in full for services rendered and forever
      waives all right, title and interest to any further compensation by the Company;
      

     

    NOW,
      THEREFORE, the Parties hereto, intending to be legally bound, hereby agree
      as
      follows:

     

    Section
      1.  Waiver
      and Settlement.
      Effective upon the execution of this Agreement, and concurrent with the return
      to the Company of the signed Stock certificates for ten million shares
      (10,000,000) in the name of Appalachian Technology and Transportation,
      (Appalachian) Inc. for cancellation of five million shares (5,000,000) and
      re-issuance of two million shares (2,000,000) of restricted common stock in
      the
      name of Appalachian and three million shares (3,000,000) in the names per
      schedule A, attached, the Contractor hereby waives all rights, claims, interests
      and title to the Original Agreement and hereby agrees that any previous
      agreements or understandings between the Parties are null and void and of no
      further force or effect. Further, the Contractor will concurrently execute
      the
      attached Resignation Letter, in consideration for a one-time settlement and
      separation fee of one-hundred thousand dollars ($100,000) to be paid to
      Contractor, commencing with $10,000 payments on July 25, 2007 and the first
      of
      the month for August through December 2007 with a final payment not later than
      December 31, 2007 for which the Contractor will be responsible for his own
      taxes. Further, for a period of one-year, the Company acknowledges that it
      will
      compensate Contractor a Finders Fee (Fee) at a rate of five percent of the
      gross
      amount of dollars received by the Company in the form of a debenture, note
      or
      similar instrument, brought about through the sole efforts of the Contractor,
      said Fee to be payable within 10 days of receipt of those funds by the Company.
      It is understood that this Fee as a cumulative and total Fee and any other
      costs
      or fees associated with the delivery of such funding will be deducted from
      this
      Fee. The Company and the LP hereby and forever agree to indemnify Contractor
      against any and all claims for all of time from the Company and/or the LP or
      any
      of their members or shareholders brought about as a result of Contractors
      representation, services provided, and work performed from the date of the
      first
      Contractor engagement through the date of this Agreement. Further, the Company
      agrees to indemnify, hold harmless, and cover any expenses or judgments against
      Contractor from any actions, suits, or claims from Richard Haggart, Consumer
      Value Network, Steve White or its affiliates or assigns.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    Section
      2.  Release.
      (a)
      Contractor hereby waives, releases and discharges the Company, and the Company
      hereby waives, releases and discharges the Contractor its subsidiaries and
      their
      respective officers, directors, stockholders, employees, agents, attorneys,
      subsidiaries, servants, successors, insurers, affiliates and their successors
      and assigns, from any and all manner of action, claims, liens, demands,
      liabilities, causes of action, charges, complaints, suits (judicial,
      administrative or otherwise), damages, debts, obligations of any nature, past
      or
      present, known or unknown, whether in law or in equity, whether founded upon
      contract (expressed or implied), tort (including, but not limited to,
      defamation), statute or regulation (State, Federal or local), common law and/or
      any other theory or basis, from the beginning of the world to the date hereof,
      including, but not limited to, any claim that the Contractor has asserted,
      now
      asserts or could have asserted, but not including any claim for the enforcement
      of this Agreement. Further, the LP hereby extend the same release and indemnity
      to Contractor, and the Company agrees to fully indemnify Contractor for any
      claims from an parties for any non-criminal actions during the terms of
      Contractor’s Agreement including any reasonable attorney fees that may be
      incurred by Contractor.

     

    (b)
      It is
      understood and agreed by the Parties that the facts and respective assumptions
      of law in contemplation of which this Agreement is made may hereafter prove
      to
      be other than or different from those facts and assumptions now known, made
      or
      believed by them to be true. The Parties expressly accept and assume the risk
      of
      the facts and assumptions being different, and agree that all terms of this
      agreement shall be in all respects effective and not subject to termination
      or
      reclusion by any such difference in facts or assumptions of law.

     

    Section
      3.  Successors.
      This
      Agreement shall be binding upon and inure to the benefit of the Parties and
      their respective administrators, representatives, executors, successors and
      assigns, by reason of merger, consolidation, and/or purchase or acquisition
      of
      substantially all of the Company’s assets or otherwise.

     

    Section
      4.  Governing
      Law.
      Each
      Party acknowledges that it has been represented by counsel in connection with
      this Agreement, and has executed the same with knowledge of its consequences.
      This Agreement is made and entered into under Nevada law and shall be
      interpreted, enforced and governed under the laws of the laws of Nevada without
      regard to its conflicts of laws principles. 

     

    Section
      5.  Paragraph
      Headings.
      The
      paragraph headings used in this Agreement are intended solely for convenience
      of
      reference and shall not in any manner amplify, limit, modify or otherwise be
      used in the interpretation of any of the provisions hereof.

     

    Section
      6.  Severability.
      Should
      any of the provisions of this Agreement be declared or be determined to be
      illegal or invalid, the validity of the remaining parts, terms or provisions
      shall not be affected thereby and said illegal or invalid part, term or
      provision shall be deemed not to be a part of this Agreement. 

     

    Section
      7.  Entire
      Agreement.
      This
      Agreement sets forth the entire agreement between the Parties, and fully
      supersedes any and all prior agreements or understandings between the Parties
      pertaining to the subject matter hereof. All other contracts, agreements or
      understandings between the Parties are null and void. Without limiting the
      foregoing, any and all employment agreements, including all amendment and/or
      addendums thereto, shall be terminated and of no further force or effect,
      whether or not such agreements state that the same, or portions thereof, are
      to
      survive termination. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Section
      8.  Counterparts.
      This
      Agreement may be executed in counterparts. Each counterpart shall be deemed
      an
      original, and when taken together with the other signed counterpart, shall
      constitute one fully executed Agreement.

     

    Section
      9.  Further
      Assurances.
      From
      and after the date hereof, the parties hereto shall take all actions, including
      the execution and delivery of all documents, necessary to effectuate the terms
      hereof. 

     

    Section
      10.  Survival.
      All
      obligations of the Parties as set forth herein shall survive the execution
      and
      delivery hereof. 

     

    IN
      WITNESS WHEREOF, the Parties have caused this Agreement to be entered into
      as of
      the date first written above.

     

    

      
        	
                APPALACHIAN
                  TECHNOLOGY AND TRANSPORTATION, INC.

                 

                 

              
	
                By:

              	 
	
                Name:
                  David J. Larson

              
	
                Title:  
                  President

              

      

      
        
          	 
	
                  STATE
                    OF

                	
                  )

                
	 	 	
                  ss:

                
	
                  COUNTY
                    OF

                	
                  )

                
	
                   

                  
                    I
                      certify that on July __, 2007, David J. Larson personally came
                      before and
                      acknowledged under oath, to my satisfaction, that he is an
                      Officer of
                      Appalachian Technology and Transportation, Inc. (the “Corporation”),
                      a corporation and that the foregoing instrument was signed
                      on behalf of
                      the Corporation by authority of its Board of Directors, and
                      that he
                      acknowledged said instrument to be the free act and deed of
                      the
                      Corporation.

                    

                    Signed
                      and sworn to before me on July __, 2007

                    

                    _____________________________

                    Notary
                      Public of the State of

                  

                

        

         

        
          
            
            

          

          
            3

            
              

            

          

          
            
            

          

        

      

    

    

    
      
        	
                
                  INDIGO-ENERGY,
                    INC.

                

                 

              
	
                By:

              	 
	
                Name:
                  Steve Durdin

              
	
                Title:  
                  Director

              

      

      
        
          	 
	
                  STATE
                    OF

                	
                  )

                
	 	 	
                  ss:

                
	
                  COUNTY
                    OF

                	
                  )

                
	
                  
                    
                      
                         

                        I
                          certify that on July __, 2007, Steve Durdin personally
                          came before and
                          acknowledged under oath, to my satisfaction, that he is
                          an officer of
                          INDIGO-ENERGY, INC. (the “Corporation”),
                          a corporation of the State of Nevada and that the foregoing
                          instrument was
                          signed on behalf of the Corporation by authority of its
                          Board of
                          Directors, and that he acknowledged said instrument to
                          be the free act and
                          deed of the Corporation.

                        

                        Signed
                          and sworn to before me on July __, 2007

                        

                        _____________________________

                        Notary
                          Public of the State
                          of

                      

                    

                  

                

        

      

    

     

     

     

    
      
        
          
            	
                    
                      Indigo
                        Energy-Parners, LP

                       

                    

                  
	
                    By:

                  	 
	
                    Name:
                      Steve Durdin

                  
	
                    Title:  
                      General Partner & Investment
                      Leadership

                  

          

          
            
              	 
	
                      STATE
                        OF

                    	
                      )

                    
	 	 	
                      ss:

                    
	
                      COUNTY
                        OF

                    	
                      )

                    
	
                      
                        
                           

                          I
                            certify that on July __, 2007, Steve Durdin personally
                            came before and
                            acknowledged under oath, to my satisfaction, that he
                            is an officer of
                            INDIGO-ENERGY, PARTNERS LP. (the “LP”), a corporation and that the
                            Agreement was signed on behalf of the Corporation by
                            authority of its
                            Board of Directors, and that he acknowledged said instrument
                            to be the
                            free act and deed of the Corporation and that (a) he
                            is named in and
                            personally signed this document; and (b) signed and delivered
                            this
                            document as his act and deed..

                           

                          Signed
                            and sworn to before me on July __, 2007

                           

                          _____________________________

                          Notary
                            Public of the State
                            of

                        

                      

                    

            

          

        

         

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

         

        
          
            
              
                
                  
                    
                      
                        
                          	
                                  
                                    Indigo
                                      Energy-Parners, LP

                                     

                                     

                                  

                                
	
                                  James
                                    C. Walter Jr.

                                
	
                                  General
                                    Partner & Investment
                                    Leadership

                                

                        

                      

                    

                  

                

                
                  
                    	
                             

                          
	______________________________
	
                            STATE
                              OF

                          	
                            )

                          
	 	 	
                            ss:

                          
	
                            COUNTY
                              OF

                          	
                            )

                          
	
                            
                              
                                 

                                
                                  I
                                    certify that on July __, 2007, James C Walter,
                                    Jr. personally came before
                                    and acknowledged under oath, , to my satisfaction,
                                    that he is a General
                                    Partner of INDIGO-ENERGY, PARTNERS LP. (the “LP”), a corporation and that
                                    the Agreement was signed on behalf of the Corporation
                                    by authority of its
                                    Board of Directors, and that he acknowledged
                                    said instrument to be the
                                    free act and deed of the Corporation, and that
                                    (a) he is named in and
                                    personally signed this document; and (b) signed
                                    and delivered this
                                    document as his act and deed.

                                   

                                  Signed
                                    and sworn to before me on July__, 2007

                                   

                                  _____________________________

                                  Notary
                                    Public of the State
                                    of

                                

                              

                            

                          

                  

                

              

               

            

          

        

      

    

     

    
      
        
          
             

            
              
                
                  
                    	
                            
                              
                                INDIGO-ENERGY,
                                  INC.

                              

                               

                            

                          
	
                            By:

                          	 
	
                            Name:
                              Stanley L. Teeple

                          
	
                            Title:  
                              Secretary,
                              Director

                          

                  

                

              

            

          

          
            
              	 
	
                      STATE
                        OF

                    	
                      )

                    
	 	 	
                      ss:

                    
	
                      COUNTY
                        OF

                    	
                      )

                    
	
                      
                        
                           

                          
                            
                              I
                                certify that on July __, 2007, Stanley L. Teeple,
                                personally came before
                                and acknowledged under oath, to my satisfaction,
                                that he is an officer and
                                Director of INDIGO-ENERGY, INC. (the “Corporation”),
                                a corporation of the State of Nevada and that the
                                foregoing instrument was
                                signed and on behalf of the Corporation by authority of its Board of
                                Directors, and that he acknowledged said instrument
                                to be the free act and
                                deed of the Corporation.

                               

                              Signed
                                and sworn to before me on July __, 2007

                               

                              _____________________________

                              Notary
                                Public of the State
                                of

                            

                          

                        

                      

                    

            

          

        

         

      

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    

    From
      The Desk Of:

    David
      Larson, CEO

    

    

     

    Board
      of Directors

    Indigo-Energy,
      Inc.

    701
      N. Green Valley Pkwy

    Suite
      200

    Henderson,
      NV 89052

    

    July
      20, 2007

    

    

    Gentlemen-

    

    I
      hereby tender my resignation as President, Chief Executive Officer, and Member
      of the Board of Directors (Director) effective at such time as the Board of
      Directors may, at their sole discretion, replace me in any or all of these
      capacities. I will continue to serve in these capacities until noticed by the
      Board of Directors of the effective date of my resignation but in no case later
      than 31 December 2007. I am submitting this resignation without any conflict
      or
      dispute of any kind with the Company or any of its Officers or
      Directors.

    

    

    

    

    David
      Larson

    President

    Chief
      Executive Officer

    Director,
      Member of the Board of Directors

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    Schedule
      A

     

    
      	
              Partner
                Participant

            	
              Total
                Investment

            	
              Well
                2 Investment

            	
              Total
                Investment

            	
              %
                of Total Invested

            	
              Shares
                in Gift Distribution

            
	
              Jim
                Walter, Sr.

            	
              $800,000.00

            	
              **

            	
              $800,000.00

            	
              16.33%

            	
              489,796

            
	
              Jim
                Walter, Jr.

            	
              $650,000.00

            	 	
              $650,000.00

            	
              13.27%

            	
              397,959

            
	
              Steve
                Durdin

            	
              $600,000.00

            	 	
              $600,000.00

            	
              12.24%

            	
              367,347

            
	
              Bill
                Wenzel, Jr.

            	
              $500,000.00

            	
              $200,000.00

            	
              $700,000.00

            	
              14.29%

            	
              428,571

            
	
              Dennis
                Ramos

            	
              $300,000.00

            	 	
              $300,000.00

            	
              6.12%

            	
              183,673

            
	
              Jim
                Salasin

            	
              $350,000.00

            	 	
              $350,000.00

            	
              7.14%

            	
              214,286

            
	
              Bill
                Wenzel, Sr.

            	
              $300,000.00

            	 	
              $300,000.00

            	
              6.12%

            	
              183,673

            
	
              Jerry
                Braatz, Sr.

            	
              $250,000.00

            	 	
              $250,000.00

            	
              5.10%

            	
              153,061

            
	
              Jim
                Dunn

            	
              $200,000.00

            	
              $100,000.00

            	
              $300,000.00

            	
              6.12%

            	
              183,673

            
	
              Jerry
                Braatz, Jr.

            	
              $150,000.00

            	
              $200,000.00

            	
              $350,000.00

            	
              7.14%

            	
              214,286

            
	
              Henry
                Cobb

            	
              $50,000.00

            	 	
              $50,000.00

            	
              1.02%

            	
              30,612

            
	
              Don
                Blatherwick

            	
              $50,000.00

            	 	
              $50,000.00

            	
              1.02%

            	
              30,612

            
	
              JJ
                Johnson

            	
              $100,000.00

            	 	
              $100,000.00

            	
              2.04%

            	
              61,224

            
	
              Bruce
                Muhlburger

            	
              $100,000.00

            	 	
              $100,000.00

            	
              2.04%

            	
              61,224

            
	
               

            	
               

            	 	 	 	 
	
              TOTAL

            	
              $4,400,000.00

            	
              $500,000.00

            	
              $4,900,000.00

            	
              100.00%

            	
              3,000,000

            
	 	 	 	 	 	 
	
              **
                Jim Walter Sr. is omitted from Well 2 calculation because of alternate
                deal pending

            	 	 

    

     

    
      
        
        

      

      
        7PROMISSORY
      NOTE- JS/HMS

    CASH
      OUT

     

    
      
        	
                $125,000
                  (One Hundred Twenty Five Thousand Dollars)

              	 	
                Dated:
                  July 10, 2007 

              
	
                Principal
                  Amount 

              	 	
                State
                  of Nevada

              

      

       

    

    Funding
      Date-
      On or
      before July 12, 2007

    Due
      Date
      of Note
      October 12, 2007

     

    FOR
      VALUE
      RECEIVED, One Hundred Twenty Five Thousand Dollars ($125,000), the undersigned,
      Indigo-Energy, Inc., a Nevada Corporation, located at 701 N. Green Valley
      Parkway, Suite 200, Henderson, NV 89074 (Borrowers)
      hereby
      promises to pay to the order of Jeremy
      Sanchez and Heather McIlhinney-Sanchez, individuals, residing at 19371 Brookside
      Way, Bend, OR 97702 (Maker)
      the sum
      of $125,000 (One Hundred Twenty Five Thousand Dollars). Said sum shall be paid
      in the manner following: 

    

    This
      Promissory
      Note
      shall
      bear Interest
      at ten
      percent (12%) per annum from the Funding Date to the Due Date.

    

    At
      the
      Due Date Borrower will repay the Note in the following manner:

    

    Borrower
      will repay the Principal Amount along with accrued Interest within 10 days
      of
      the Due Date via check to the Makers address above.

    

    Additionally,
      the Maker shall receive three shares of Borrower’s common stock for each dollar
      amount of the Principal Amount within thirty (30) days of disbursement of the
      funds (see below), such stock to be restricted by Rule 144.

    

    This
      Note
      shall at the option of the Maker be immediately due and payable upon the
      occurrence of any of the following:

    	1-  	
            Breach
              of any condition of any of the security
              interest.

          

    	2-  	
            Upon
              the insolvency, dissolution, or liquidation of the
              Borrowers.

          

    

    

    Disbursement
      Instructions:
      The
      stated use of funds provided by this Promissory Note is for obtaining well
      assignments from the Borrowers drillers and making disbursements to related
      service providers allowing the filing of the required SEC and NASD filings
      to
      bring the Borrower current in its filings. All of the funds collected under
      this
      Note shall be held in the below listed account until released by the Borrowers
      Board of Directors representation that said release would accomplish the stated
      goal of the Note. If the funds are not disbursed prior to July 31, 2007, the
      Principal Amount will be returned to the Maker with appropriate pro-rata
      Interest but without any stock.

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    Wire
      Instructions for receipt of funds by Borrower are:

    Bank
      of
      America

    Branch
      NV1-155-01-01

    Banker:
      Charity Lopez

    2638
      W.
      Horizon Ridge Parkway

    Henderson,
      NV 89052

    702-654-6316

    702-654-6342
      fax

    Indigo-Energy
      Partners, LP.

    Account
      #
      004967949695

    Wire
      Routing ABA # 026009593

    

    

    The
      Borrower has a properly executed Restricted Equity Purchase Agreement (REPA)
      in
      place with an Investment Fund.  The Company has issued restricted stock,
      the REPA provides working capital.  The final requirement to qualify for
      that funding is that the Company be fully reporting and current in its filings
      by the REPA funding date.

    The
      first portion of that promised $3 million is set to fund approximately
      Mid-August.  That portion will be well in excess of $1 million net to the
      Company.

    By
      signing below, the Company pledges to pay out the cash portion terms of this
      Promissory Note on or before the Due Date from first proceeds received from
      the
      REPA agreement.

    

    In
      the
      event this note shall be in default, and placed with an attorney for collection,
      then the Borrower agrees to pay all reasonable attorney fees and costs of
      collection. Payments not made within 10 days of due date shall be subject to
      a
      late charge of 10% of said payment. All payments hereunder shall be made to
      the
      Maker.

    

    The
      Borrowers agree to be fully bound hereunder until this note shall be fully
      paid
      and waive demand, presentment and protest and all notices thereto and further
      agrees to remain bound, notwithstanding any extension, renewal, modification,
      waiver, or other indulgence by the Maker or upon the discharge or release of
      the
      Borrowers, or upon the exchange, substitution, or release of any collateral
      granted as security for this Note. No modification or indulgence by Maker shall
      be binding unless in writing, and any indulgence for one occasion shall not
      be
      an indulgence for any other or future occasion. This Note shall take effect
      as a
      sealed instrument and shall be construed, governed, and enforced in accordance
      with the laws of the State of Nevada. 

    

    

    Signed
      the date recorded below:

    

    
      	 	 	 	 	 
	
              Stanley
                L. Teeple, CFO

            	 	
              Date

            	 	 
	
              Indigo-Energy,
                Inc.

            	 	 	 	 
	 	 	 	 	 
	Accepted
              by Maker:	 	 	 	 
	 	 	 	 	 
	
               

            	 	 	 	 
	 Jeremy
              Sanchez,
              an
              individual	 	 Date	 	 
	
               

            	 	
               

            	 	
              SSAN#

            
	 Accepted
              by Maker:	 	 	 	 
	 	 	 	 	 
	
               

            	 	 	 	 
	
              Heather
                McIlhinney-Sanchez,
                an
                individual

            	 	
              Date

            	 	
              SSAN#

            

    

    
 

    PromNoteCashOut-
      JS/HMS

    
      
         

      

      
        2

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