Document:

EXHIBIT
        10.1

    

     

    PURCHASE
      AND SALE AGREEMENT 

     

    BETWEEN

     

    GEOCHEM
      EXPLORATION, LLC

    

    AS
      SELLER

    

    AND

    

    AMERIWEST
      ENERGY CORP.

    

    AS
      BUYER

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    PURCHASE
      AND SALE AGREEMENT 

     

    This
      Purchase and Sale Agreement (this “Agreement”)
      is
      made and entered into this _____ day of _______________, 2008, by and between
      Geochem Exploration, LLC, a Wyoming limited liability company (the “Seller”),
      and
      Ameriwest Energy Corp., a Nevada corporation (the “Buyer”).
      Buyer
      and Seller are collectively referred to herein as the “Parties”,
      and
      are sometimes referred to individually as a “Party.”

     

    WITNESSETH:

     

    WHEREAS,
      Seller is willing to sell to Buyer, and Buyer is willing to purchase from
      Seller, the Assets (as defined in Section 1.02), all upon the terms and
      conditions hereinafter set forth;

     

    NOW,
      THEREFORE, in consideration of the mutual benefits derived and to be derived
      from this Agreement by each Party, Seller and Buyer hereby agree as
      follows:

     

    Article
      I

    Assets

     

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

     

    Section
      1.02 Assets.
      Subject
      to Section 1.03, the term “Assets” shall mean all of Seller’s right, title and
      interest in and to:

     

    
      	 	
              (a)

            	
              the
                leasehold estates in and to the oil, gas and mineral leases described
                or
                referred to in Exhibit A attached hereto (the “Leases”)
                at the working interest and net revenue interest percentages described
                on
                Exhibit A attached hereto (collectively, the “Subject
                Interests,”
                or singularly, a “Subject
                Interest”);

            

    

     

    
      	 	
              (b)

            	
              all
                rights incident to the Subject Interests, including, without limitation,
                (i) all rights with respect to the use and occupation of the surface
                of
                and the subsurface depths under the Subject Interests; (ii) all rights
                with respect to any pooled, communitized or unitized acreage by virtue
                of
                any Subject Interest being a part thereof after the Effective Time
                (as
                defined in Section 2.03) attributable to the Subject Interests or
                any such
                pool or unit allocated to any such Subject
                Interest;

            

    

     

    
      	 	
              (c)

            	
              all
                easements, rights-of-way, surface leases, servitudes, permits, licenses,
                franchises and other estates or similar rights and privileges directly
                related to or used solely in connection with the Subject Interests
                (the
                “Easements”);

            

    

     

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    
      	 	
              (d)

            	
              all
                contracts, agreements and other arrangements that directly relate
                to the
                Subject Interests, the Leases or the Easements, including, without
                limitation, production sales contracts, farmout agreements, operating
                agreements, service agreements and similar arrangements (collectively,
                the“Contracts”);
                

            

    

     

    
      	 	
              (e)

            	
              all
                books, records, files, muniments of title, reports and similar documents
                and materials, including, without limitation, lease records, well
                records,
                and division order records, well files, title records (including
                abstracts
                of title, title opinions and memoranda, and title curative documents
                related to the Assets), contracts and contract files, correspondence,
                that
                relate to the foregoing interests in the possession of, and maintained
                by,
                Seller (collectively, the “Records”);
                and

            

    

     

    
      	 	
              (f)

            	
              all
                geological and geophysical data relating to the Subject Interests,
                other
                than such data that is interpretive in nature or which cannot be
                transferred without the consent of or payment to any Third Party
                as
                disclosed on Exhibit A. For purposes of this Agreement, “Third
                Party”
                means any person or entity, governmental or otherwise, other than
                Seller
                or Buyer, and their respective affiliates; the term includes, but
                is not
                limited to, working interest owners, royalty owners, lease operators,
                landowners, service contractors and governmental
                agencies.

            

    

     

    Section
      1.03 Excluded
      Assets.
      Notwithstanding the foregoing, the Assets shall not include, and there is
      excepted, reserved and excluded from the sale contemplated hereby (collectively,
      the “Excluded Assets”): (a) all credits and refunds and all accounts,
      instruments and general intangibles (as such terms are defined in the Wyoming
      Uniform Commercial Code) attributable to the Assets with respect to any period
      of time prior to the Closing Date; (b) all claims of Seller for refunds of
      or
      loss carry forwards with respect to (i) ad valorem, severance, production or
      any
      other taxes attributable to any period prior to the Closing Date, (ii) income
      or
      franchise taxes attributable to any period prior to the Closing Date, or (iii)
      any taxes attributable to the other Excluded Assets, and such other refunds,
      and
      rights thereto, for amounts paid in connection with the Assets and attributable
      to the period prior to the Closing Date, including refunds of amounts paid
      under
      any gas gathering or transportation agreement; (c) all proceeds, income or
      revenues (and any security or other deposits made) attributable to (i) the
      Assets for any period prior to the Closing Date, or (ii) any other Excluded
      Assets for any period prior to the Closing Date; (d) all of Seller’s proprietary
      computer software, technology, patents, trade secrets, copyrights, names,
      trademarks, logos and other intellectual property; (e) all of Seller’s rights
      and interests in geological and geophysical data that is interpretive in nature
      or which cannot be transferred without the consent of or payment to any Third
      Party as disclosed on Exhibit A; (f) all documents and instruments of Seller
      that may be protected by an attorney-client privilege; (g) data and other
      information of Seller unrelated to the Assets that cannot be disclosed or
      assigned to Buyer as a result of confidentiality or similar arrangements under
      agreements with persons unaffiliated with Seller; (h) all audit rights arising
      under any of the Contracts or otherwise with respect to any period prior to
      the
      Closing Date or to any of the other Excluded Assets for any period prior to
      the
      Closing Date; and (i) all corporate, partnership, income tax records of
      Seller.

    
      
        
        

      

      
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    Article
      II

    Purchase
      Price

    

    Section
      2.01 Purchase
      Price.
      The
      total consideration for the purchase, sale and conveyance of the Assets to
      Buyer
      is Buyer’s payment to Seller of the sum of US$400,000.00 (the “Purchase Price”).
The
      Purchase
      Price shall be paid to Seller (or its designee) at Closing (as defined in
      Section 10.01) by means of a completed federal funds transfer to an account
      designated in writing by Seller.
      The
      parties acknowledge that Buyer has paid Seller the sum of US$100,000.00, and
      said sum is fully earned and non-refundable, but said sum shall be applied
      as a
      credit to the purchase price to be paid by Seller at Closing. Upon execution
      of
      this Agreement, Buyer shall pay Seller the sum of US$300,000.00, and said sum
      is
      fully earned and non-refundable, but said sum shall be applied as a credit
      to
      the purchase price to be paid by Seller at Closing. 

     

    Section
      2.02 Allocated
      Values.
      The
      Purchase Price is fully allocated to the Leases conveyed at Closing unless
      such
      allocation is contrary to U.S. generally accepted accounting principles, as
      consistently applied to Buyer’s financial statements (“GAAP”),
      in
      which case, the maximum portion of the Purchase Price shall be allocated to
      the
      Leases and any remainder shall be allocated in accordance with GAAP (the
“Allocated Values”). 

     

    Section
      2.03 Effective
      Time.
      If the
      transactions contemplated hereby are consummated in accordance with the terms
      and provisions hereof, the ownership of the Assets shall be transferred from
      Seller to Buyer on the Closing Date, and shall be deemed effective as of 7:00
      a.m. Mountain Time on __________, 2008 (the “Effective Time”).

     

    Article
      III

    Title
      Matters

    

    Section
      3.01 Title.
      Seller
      has permitted Buyer and/or its representatives the opportunity to fully examine
      Seller’s title to the Assets. Buyer accepts the condition of Seller’s title to
      the Assets, is fully satisfied that Seller has Defensible Title (as defined
      in
      Section 3.02) to the Assets, and waives any objection as to any title condition
      that in any way relates to the Assets.

     

    Section
      3.02 Defensible
      Title and Permitted Encumbrances.
      For
      purposes of this Agreement, the term “Defensible Title” means, with respect to a
      given Asset, such ownership by Seller in such Asset that, subject to and except
      for the Permitted Encumbrances (as defined in Subsection (c) of this Section
      3.02):

     

    
      	 	
              (a)

            	
              entitles
                Seller to receive not less than the net revenue interest percentage
                set
                forth in Exhibit A as Seller’s “Net
                Revenue Interest”
                of all Hydrocarbons produced, saved and marketed from each leasehold
                property as set forth in Exhibit A; and

            

    

     

    
      	 	
              (b)

            	
              is
                free and clear of all liens and encumbrances in
                title.

            

    

     

    
      	 	
              (c)

            	
              The
                term “Permitted Encumbrances” shall mean any of the following matters to
                the extent the same are valid and subsisting and affect the Assets:

            

    

     

    
      
        
        

      

      
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              (i)

            	
              the
                Leases, and Contracts to the extent the same do not reduce the Net
                Revenue
                Interests of Seller below those set forth in Exhibit A, decrease the
                Working Interests of Seller below those set forth in Exhibit A, or
                increase the Working Interests of Seller above those set forth in
                Exhibit A without a corresponding increase in the Net Revenue
                Interest;

            

    

     

    
      	 	
              (ii)

            	
              any
                (A) undetermined or inchoate liens or charges constituting or securing
                the
                payment of expenses that were incurred incidental to the maintenance,
                development, production or operation of the Assets or for the purpose
                of
                developing, producing or processing Hydrocarbons therefrom or therein,
                and
                (B) materialman’s, mechanics’, repairman’s, employees’, contractors’,
                operators’ liens or other similar liens or charges for liquidated amounts
                arising in the ordinary course of business (1) that Seller has agreed
                to
                assume or pay pursuant to the terms hereof, or (2) for which Seller
                is
                responsible for paying or releasing at the
                Closing;

            

    

     

    
      	 	
              (iii)

            	
              any
                liens for taxes and assessments not yet delinquent or, if delinquent,
                that
                are being contested in good faith in the ordinary course of business
                and
                for which the Seller has agreed to pay pursuant to the terms hereof
                or
                which have been prorated pursuant to the terms
                hereof;

            

    

     

    
      	 	
              (iv)

            	
              the
                terms, conditions, restrictions, exceptions, reservations, limitations
                and
                other matters contained in (including any liens or security interests
                created by law or reserved in oil and gas leases for royalty, bonus
                or
                rental, or created to secure compliance with the terms of) the agreements,
                instruments and documents that create or reserve to Seller its interest
                in
                the Assets to the extent the same do not reduce the Net Revenue Interests
                of Seller below those set forth in Exhibit A, decrease the Working
                Interests of Seller below those set forth in Exhibit A, or increase
                the
                Working Interests of Seller above those set forth in Exhibit A
                without a corresponding increase in the Net Revenue
                Interest;

            

    

     

    
      	 	
              (v)

            	
              any
                obligations or duties affecting the Assets to any municipality or
                public
                authority with respect to any franchise, grant, license or permit
                and all
                applicable laws, rules, regulations and orders of any Governmental
                Authority (as defined in Section
                4.02(b));

            

    

     

    
      	 	
              (vi)

            	
              any
                (A) easements, rights-of-way, servitudes, permits, surface leases
                and
                other rights in respect of surface operations, pipelines, grazing,
                hunting, lodging, canals, ditches, reservoirs or the like, and (B)
                easements for streets, alleys, highways, pipelines, telephone lines,
                power
                lines, railways and other similar rights-of-way on, over or in respect
                of
                property owned or leased by Seller or over which Seller owns
                rights-of-way, easements, permits or licenses, to the extent that
                same do
                not materially interfere with the oil and gas operations to be conducted
                on the Assets or materially affect the value
                thereof;

            

    

     

    
      
        
        

      

      
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              (vii)

            	
              all
                lessors’ royalties, overriding royalties, net profits interests, carried
                interests, production payments, reversionary interests and similar
                burdens
                on or deductions from the proceeds of production created or in existence
                as of the Effective Time, whether recorded or filed, provided that
                the net
                cumulative effect of such burdens do not operate to reduce the Net
                Revenue
                Interests of Seller below those set forth in Exhibit A, or decrease
                the
                Working Interests of Seller below those set forth in Exhibit A;
                

            

    

     

    
      	 	
              (viii)

            	
              preferential
                rights to purchase or similar agreements with respect to which (A)
                waivers
                or consents are obtained from the appropriate parties for the transaction
                contemplated hereby, or (B) required notices have been given for
                the
                transaction contemplated hereby to the holders of such rights and
                the
                appropriate period for asserting such rights has expired without
                an
                exercise of such rights; 

            

    

     

    
      	 	
              (ix)

            	
              required
                Third Party consents to assignments or similar agreements with respect
                to
                which (A) waivers or consents are obtained from the appropriate parties
                for the transaction contemplated hereby, or (B) required notices
                have been
                given for the transaction contemplated hereby to the holders of such
                rights and the appropriate period for asserting such rights has expired
                without an exercise of such rights;

            

    

     

    
      	 	
              (x)

            	
              all
                rights to consent by, required notices to, filings with, or other
                actions
                by Governmental Authorities in connection with the sale or conveyance
                of
                oil and gas leases or interests therein that are customarily
                obtained subsequent to such sale or
                conveyance;

            

    

     

    
      	 	
              (xi)

            	
              production
                sales contracts; division orders; contracts for sale, purchase, exchange,
                refining or processing of Hydrocarbons; unitization and pooling
                designations, declarations, orders and agreements; operating agreements;
                agreements of development; area of mutual interest agreements; gas
                balancing or deferred production agreements; processing agreements;
                plant
                agreements; pipeline, gathering and transportation agreements; injection,
                repressuring and recycling agreements; carbon dioxide purchase or
                sale
                agreements; salt water or other disposal agreements; seismic or
                geophysical permits or agreements; and any and all other agreements
                that
                have terms that are ordinary and customary to the oil, gas, sulphur
                and
                other mineral exploration, development, processing or extraction
                business
                or in the business of processing of gas and gas condensate production
                for
                the extraction of products therefrom, to the extent the same do not
                reduce
                the Net Revenue Interests of Seller below those set forth in
                Exhibit A, decrease the Working Interests of Seller below those set
                forth in Exhibit A, or increase the Working Interests of Seller above
                those set forth in Exhibit A without a corresponding increase in the
                Net Revenue Interest;
                

            

    

     

    
      
        
        

      

      
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              (xii)

            	
              rights
                reserved to or vested in any Governmental Authority to control or
                regulate
                any of the Assets and the applicable laws, rules, and regulations
                of such
                Governmental Authorities; and

            

    

     

    
      	 	
              (xiii)

            	
              all
                defects and irregularities affecting the Assets which individually
                or in
                the aggregate (A) do not operate to (1) reduce the Net Revenue Interest
                of
                Seller, (2) increase the proportionate share of costs and expenses
                of
                leasehold operations attributable to or to be borne by the Working
                Interests of Seller, (3) decrease the Working Interests of Seller
                below
                those set forth in Exhibit A, or (4) otherwise interfere materially
                with
                the operation, value or use of the Assets, or (5) that would not
                be
                considered material when applying general industry standards; or
                (B)
                operate to increase the proportionate share of costs and expenses
                of
                leasehold operations attributable to or to be borne by the Working
                Interest of Seller, so long as there is a proportionate increase
                in
                Seller’s Net Revenue Interest.

            

    

     

    Section
      3.03 Title
      Defect.
      The term
“Title Defect,” as used in this Agreement, shall mean: (a) any material
      encumbrance, encroachment, or defect in or objection to Seller’s ownership of
      any Asset (expressly excluding Permitted Encumbrances) that causes Seller not
      to
      have Defensible Title to such Asset; or (b) any default by Seller under a lease,
      farmout agreement or other contract or agreement that would (i) have a material
      adverse affect on the operation, value or use of such Asset, (ii) prevent Seller
      from receiving the proceeds of production attributable to Seller’s interest
      therein or (iii) result in cancellation of Seller’s interest
      therein.
      The term
“Title Defect,” as used in this Agreement, shall not include: (a) Defects based
      solely on Buyer’s assertion that Seller’s files lack information, but
      information not within Seller’s files may, as provided herein, be relied upon by
      Buyer to evaluate and constitute the basis for an alleged Title Defect; (b)
      Defects in the early chain of title consisting of the failure to recite marital
      status in a document or omissions of successors of heirship or estate
      proceedings, unless Buyer provides a reasonable basis for the assertion that
      such failure or omission has resulted in a third party’s actual and superior
      claim of title to the affected Asset; (c) Defects arising out of lack of survey;
      (d) Defects arising out of lack of corporate or other entity authorization
      unless Buyer provides a reasonable basis for the assertion that the action
      was
      not authorized and that such lack of authorization results in a third party’s
      actual and superior claim of title to the affected Asset; (e) Defects that
      are
      defensible by possession under applicable statutes of limitations for adverse
      possession or for prescription; (f) title requirements customarily considered
      as
      advisory or which are customarily waived as a matter of prudent business
      judgment, if the net cumulative effect of such burdens does not operate to
      render Seller’s title in any Asset less than Defensible Title.

    
      
        
        

      

      
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    Section
      3.04 Notice
      of Title Defect and Remedy.
      If
      Buyer discovers a Title Defect affecting the Asset, Buyer shall notify Seller
      promptly. To be effective, such notice must (i) be in writing, and (ii) describe
      the Title Defect in sufficient, specific detail (including any alleged variance
      in the Net Revenue Interest or Working Interest). Upon the receipt of such
      effective notice from Buyer, Seller and Buyer shall attempt in good faith to
      mutually agree on a resolution including, but not limited to (i) attempt to
      cure
      such Title Defect, or (ii) refund of all or a portion of the Purchase Price.
      

     

    Section
      3.05 Special
      Warranty of Title.
      Seller
      hereby agrees to warrant and defend title to the Assets solely unto Buyer
      against every person whomsoever lawfully claiming or to claim the same or any
      part thereof, by, through or under Seller, but not otherwise; subject, however,
      to the Permitted Encumbrances and the other matters set forth herein. In no
      event shall the foregoing warranty extend to or be enforceable by any party
      other than Buyer.

     

    Article
      IV

    Environmental
      Matters

    

    Section
      4.01 Environmental
      Review.

     

    
      	 	
              (a)

            	
              Buyer
                has had a full opportunity to conduct or cause a consultant to conduct
                an
                environmental review of the Assets, and Buyer accepts, and is satisfied
                with, the environmental condition of the Assets, and waives all objections
                as to any Environmental Defect. The cost and expense of Buyer’s
                environmental review, if any, shall be borne solely by Buyer.
                

            

    

     

    
      	 	
              (b)

            	
              Unless
                otherwise required by applicable law, Buyer shall treat confidentially
                any
                matters revealed by Buyer’s environmental review and any reports or data
                generated from such review (the “Environmental
                Information”),
                and Buyer shall not disclose any Environmental Information to any
                Governmental Authority or other Third Party without the prior written
                consent of Seller. Unless otherwise required by law, Buyer may use
                the
                Environmental Information only in connection with the transactions
                contemplated by this Agreement and may not, directly or indirectly
                use the
                Environmental Information in any manner contrary to Seller’s interests. If
                Buyer or any Third Party to whom Buyer has provided any Environmental
                Information become legally compelled to disclose any of the Environmental
                Information, Buyer shall provide Seller with prompt notice sufficiently
                prior to any such disclosure so as to allow Seller to file any protective
                order, or seek any other remedy, as it deems appropriate under the
                circumstances. If this Agreement is terminated prior to the Closing,
                Buyer
                shall deliver the Environmental Information to Seller, which Environmental
                Information shall become the sole property of Seller. Buyer shall
                provide
                copies of the Environmental Information to Seller without
                charge.

            

    

     

    
      
        
        

      

      
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    Section
      4.02 Environmental
      Definitions. 

     

    
      	 	
              (a)

            	
              Environmental
                Defects.
                For purposes of this Agreement, the term “Environmental
                Defect”
                shall mean, with respect to any given Asset, an individual environmental
                condition that constitutes a material violation of Environmental
                Laws in
                effect as of the date of this Agreement in the jurisdiction in which
                such
                Asset is located or requires remediation under an Environmental Law.
                Environmental Defect shall not be deemed to include an environmental
                condition disclosed in writing to Buyer prior to the execution of
                this
                Agreement.

            

    

     

    
      	 	
              (b)

            	
              Governmental
                Authority.
                For purposes of this Agreement, the term “Governmental
                Authority”
                shall mean, as to any given Asset, the United States and the state,
                county, parish, city and political subdivisions in which such Asset
                is
                located and that exercises jurisdiction over such Asset, and any
                agency,
                department, board or other instrumentality thereof that exercises
                jurisdiction over such Asset.

            

    

     

    
      	 	
              (c)

            	
              Environmental
                Laws.
                For purposes of this Agreement, the term “Environmental
                Laws”
                shall mean all laws, statutes, ordinances, court decisions, rules
                and
                regulations of any Governmental Authority pertaining to the environment
                as
                may be interpreted by applicable court decisions or administrative
                orders.

            

    

     

    Article
      V

    Representations
      and Warranties of Seller

     

    Each
      respective Seller represents and warrants to Buyer that:

     

    Section
      5.01 Seller’s
      Existence.
      Geochem
      Exploration, LLC is a limited liability company duly organized and validly
      existing under the laws of the State of Wyoming and is qualified to conduct
      business in the State of Wyoming. Seller has full legal power, right and
      authority to carry on its business as such is now being conducted and as
      contemplated to be conducted.
      Except
      as disclosed to Buyer in writing, there have been no issuances of shares of
      Seller’s securities, or instruments exercisable for, convertible into or
      otherwise entitling the holder to acquire Seller’s securities.

     

    Section
      5.02 Legal
      Power.
      Seller
      has the legal power and right to enter into and perform this Agreement and
      the
      transactions contemplated hereby. The consummation of the transactions
      contemplated by this Agreement will not violate, nor be in conflict
      with:

     

    
      	 	
              (a)

            	
              any
                provision of Seller’s articles of organization, operating agreement or
                other governing documents;

            

    

     

    
      	 	
              (b)

            	
              any
                material agreement or instrument to which Seller is a party or by
                which
                Seller is bound; or

            

    

    
      
        
        

      

      
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              (c)

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

            

    

     

    Section
      5.03 Execution.
      The
      execution, delivery and performance of this Agreement and the transactions
      contemplated hereby are duly and validly authorized by all requisite partnership
      action on the part of Seller. This Agreement constitutes the legal, valid and
      binding obligation of Seller enforceable in accordance with its
      terms.

     

    Section
      5.04 Brokers.
      No
      broker or finder has acted for or on behalf of Seller or any affiliate of Seller
      in connection with this Agreement or the transactions contemplated by this
      Agreement. No broker or finder is entitled to any brokerage or finder’s fee, or
      to any commission, based in any way on agreements, arrangements or
      understandings made by or on behalf of Seller or any affiliate of Seller for
      which Buyer has or will have any liabilities or obligations (contingent or
      otherwise).

     

    Section
      5.05 Bankruptcy.
      There
      are no bankruptcy, reorganization or arrangement proceedings pending, being
      contemplated by or to the knowledge of Seller threatened against
      Seller.

     

    Section
      5.06  Business
      Operations.
      Seller’s business and financial condition remain materially unchanged from any
      due diligence or financial statement documentation provided to Buyer prior
      to
      Closing; Seller owns the right, title and interest in and to the Assets
      described on Exhibit A, subject to any Permitted Encumbrances and subject to
      any
      liens, charges, securitizations, UCC filings or debts disclosed in writing
      to
      Buyer prior to Closing. There are no outstanding mergers, acquisitions,
      financial commitments, obligations, liabilities, etc. other than those
      contemplated under this Agreement that would affect the conveyance of the
      Assets.

     

    Section
      5.07 Suits.
      There
      is no suit, action, claim, investigation or inquiry by any person or entity
      or
      by any administrative agency or Governmental Authority, that Seller is current
      in all filings with tax and regulatory agencies, and that no legal,
      administrative or arbitration proceeding pending or, to Seller’s knowledge,
      threatened against Seller or any affiliate of Seller or the Assets.

     

    Section
      5.08 Royalties.
      All
      rentals, royalties and other payments due under the Subject Interests have
      been
      paid in all material respects.

     

    Section
      5.09 Contracts.
      All
      material Contracts are in full force and effect, and Seller is not in default
      with respect to any of its material obligations thereunder.

     

    Section
      5.10 Compliance
      with Law.
      Seller
      has not received a written notice of a material violation of any statute, law,
      ordinance, regulation, permit, rule or order of any Governmental Authority
      or
      any judgment, decree or order of any court, applicable to the Assets or
      operations of the Assets, which remain uncured. 

     

    Section
      5.11 Permits.
      Seller
      has all governmental licenses, filings and permits (including, without
      limitation, permits, licenses, approval, registrations, notifications,
      exemptions and any other authorizations pursuant to applicable law) necessary
      or
      appropriate to own and operate the Assets as presently owned and operated.
      

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    Section
      5.12 Liens.
      Except
      for Permitted Encumbrances, the Assets will be conveyed free and clear of all
      liens, mortgages and encumbrances.

     

    Article
      VI

    Representations
      and Warranties of Buyer

     

    Buyer
      represents and warrants to Seller that:

     

    Section
      6.01 Buyer’s
      Existence.
      Buyer
      is a corporation, duly organized and validly existing under the laws of the
      State of Nevada and is qualified to conduct business in the State of Wyoming.
      Buyer has full legal power, right and authority to carry on its business as
      such
      is now being conducted and as contemplated to be conducted.  

     

    Section
      6.02 Legal
      Power.
      Buyer
      has the legal power and right to enter into and perform this Agreement and
      the
      transactions contemplated hereby. The consummation of the transactions
      contemplated by this Agreement will not violate, nor be in conflict
      with:

     

    
      	 	
              (a)

            	
              any
                provision of Buyer’s charter, bylaws,
                or
                other governing documents;

            

    

     

    
      	 	
              (b)

            	
              any
                material agreement or instrument to which Buyer is a party or by
                which
                Buyer is bound; or

            

    

     

    
      	 	
              (c)

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

            

    

     

    Section
      6.03 Execution.
      The
      execution, delivery and performance of this Agreement and the transactions
      contemplated hereby are duly and validly authorized by all requisite corporate
      action on the part of Buyer. This Agreement constitutes the legal, valid and
      binding obligation of Buyer enforceable in accordance with its
      terms.

     

    Section
      6.04 Brokers.
      No
      broker or finder has acted for or on behalf of Buyer or any affiliate of Buyer
      in connection with this Agreement or the transactions contemplated by this
      Agreement. No broker or finder is entitled to any brokerage or finder’s fee, or
      to any commission, based in any way on agreements, arrangements or
      understandings made by or on behalf of Buyer or any affiliate of Buyer for
      which
      Seller has or will have any liabilities or obligations (contingent or
      otherwise).

     

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

     

    Section
      6.06 Suits.
      There
      is no suit, action, claim, investigation or inquiry by any person or entity
      or
      by any administrative agency or Governmental Authority and no legal,
      administrative or arbitration proceeding pending or, to Buyer’s knowledge,
      threatened against Buyer or any affiliate of Buyer.

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    Section
      6.07 Qualifications.
      After
      the Closing, Buyer shall be qualified with all applicable Governmental
      Authorities to own and operate the Assets and shall maintain all necessary
      bonds
      to own and operate the Assets.

     

    Section
      6.08 Funds.
      Buyer
      has arranged or will arrange to have available by the dates set forth herein
      sufficient funds to enable Buyer to pay in full the Purchase Price as herein
      provided and otherwise to perform its obligations under this
      Agreement.

     

    Article
      VII

    Seller’s
      Conditions to Close

     

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

     

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

     

    Section
      7.02 Performance.
      Buyer
      shall have performed all material obligations, covenants and agreements
      contained in this Agreement to be performed or complied with by it at or prior
      to the Closing.

     

    Section
      7.03 Pending
      Matters.
      No
      suit, action or other proceeding shall be pending or threatened (a) against
      Buyer or its directors or officers, or (b) that seeks to restrain, enjoin or
      otherwise prohibit the consummation of the transactions contemplated by this
      Agreement.

     

    Section
      7.04 Purchase
      Price.
      Buyer
      shall have delivered to Seller the Purchase Price in accordance with the
      provisions of Article II.

     

    Section
      7.05 Execution
      and Delivery of the Closing Documents.
      Buyer
      shall have executed, acknowledged and delivered, as appropriate, to Seller
      all
      closing documents described in Section 10.04.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    Article
      VIII

    Buyer’s
      Conditions to Close

     

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

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

    

    Section
      8.02 Performance.
      Seller
      shall have performed all material obligations, covenants and agreements
      contained in this Agreement to be performed or complied with by it at or prior
      to the Closing.

     

    Section
      8.03 Pending
      Matters.
      No
      suit, action or other proceeding shall be pending or threatened that seeks
      to
      restrain, enjoin, or otherwise prohibit the consummation of the transactions
      contemplated by this Agreement.

     

    Section
      8.04 Execution
      and Delivery of the Closing Documents.
      Seller
      shall have executed, acknowledged and delivered, as appropriate, to Buyer all
      closing documents described in Section 10.03.

     

    Article
      IX

    Tax
      Matters

     

    

    Section
      9.01 Transfer
      Taxes.
      All
      sales, use or other taxes (other than taxes on gross income, net income or
      gross
      receipts) and duties, levies, recording fees or other governmental charges
      incurred by or imposed with respect to the property transfers undertaken
      pursuant to this Agreement shall be the responsibility of, and shall be paid
      by,
      Buyer. 

     

    Section
      9.02 Ad
      Valorem and Similar Taxes.
      Buyer
      shall assume responsibility for all ad valorem, property, severance and similar
      taxes and assessments based upon or measured by the value of the assets for
      the
      period of time from and after the Closing Date.  Any
      such
      taxes and assessments prior to the Closing Date shall be the responsibility
      of
      Seller. 

     

    Article
      X

    The
      Closing

     

    Section
      10.01  Time
      and Place of the Closing.
      If the
      conditions referred to in Articles VII and VIII of this Agreement have been
      satisfied or waived in writing or as otherwise provided in this Agreement,
      and
      subject to any extensions agreed in writing signed by the parties, the
      transactions contemplated by this Agreement (the “Closing”) shall take place at
      the offices of Seller in Casper, Wyoming, or at such other place designated
      by
      the parties, on or about May 30, 2008 (the “Closing Date”).

     

    Section
      10.02  Adjustments
      to Purchase Price at the Closing.
      At the
      Closing, Buyer shall receive a credit on the Purchase Price by the amount of
      the
      partial payments of the Purchase Price previously paid to Seller.

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    Section
      10.03  Actions
      of Seller at the Closing.

     

    At
      the
      Closing, Seller shall:

     

    
      	 	
              (a)

            	
              execute,
                acknowledge and deliver to Buyer the Assignment (as defined in Exhibit
                D
                of this Agreement) and such other instruments (in form and substance
                mutually agreed upon by Buyer and Seller) as may be reasonably necessary
                to convey the Assets to Buyer;

            

    

     

    
      	 	
              (b)

            	
              execute,
                acknowledge and deliver to Buyer letters in lieu of transfer or division
                orders directing all purchasers of production from the Subject Interests
                to make payment of proceeds attributable to such production to Buyer
                from
                and after the Closing Date as reasonably requested by Buyer prior
                to the
                Closing Date;

            

    

     

    
      	 	
              (c)

            	
              deliver
                to Buyer possession of the Assets;

            

    

     

    
      	 	
              (d)

            	
              execute
                and deliver to Buyer an affidavit attesting to its non-foreign status;
                

            

    

     

    
      	 	
              (e)

            	
              deliver
                to Buyer appropriate change of operator forms on those Assets operated
                by
                Seller; and

            

    

     

    
      	 	
              (f)

            	
              execute,
                acknowledge and deliver any other agreements provided for herein
                or
                necessary or desirable to effectuate the transactions contemplated
                hereby.

            

    

     

    Section
      10.04  Actions
      of Buyer at the Closing.

     

    At
      the
      Closing, Buyer shall:

     

    
      	 	
              (a)

            	
              deliver
                to Seller the Purchase Price (as adjusted pursuant to the provisions
                hereof and net of the Deposit) by wire transfer to an account designated
                in writing by Seller;

            

    

     

    
      	 	
              (b)

            	
              take
                possession of the Assets; 

            

    

     

    
      	 	
              (c)

            	
              execute,
                acknowledge and deliver to Seller an assignment (in the form shown
                on
                Exhibit E of this Agreement) and such other instruments as may be
                reasonably requested by Buyer to re-convey the Assets to Seller to
                secure
                performance of Buyer’s post-closing Drilling Obligation;
                and

            

    

     

    
      	 	
              (d)

            	
              execute,
                acknowledge and deliver the Assignment and any other agreements provided
                for herein or necessary or desirable to effectuate the transactions
                contemplated hereby.

            

    

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    Article
      XI

    Termination

     

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

     

    
      	 	
              (a)

            	
              by
                mutual written consent of the
                Parties;

            

    

     

    
      	 	
              (b)

            	
              by
                Seller if the Closing shall not have occurred on or before May 30,
                2008,
                unless the parties have otherwise mutually agreed to extend the Closing
                Date;

            

    

     

    
      	 	
              (c)

            	
              by
                either Party if any Governmental Authority shall have issued an order,
                judgment or decree or taken any other action challenging, restraining,
                enjoining, prohibiting or invalidating the consummation of any of
                the
                transactions contemplated herein;
                or

            

    

     

    
      	 	
              (d)

            	
              by
                Seller if Buyer shall not have paid any partial payments of the Purchase
                Price on or before their due dates as provided
                herein.

            

    

     

    Section
      11.02  Effect
      of Termination.
      In the
      event that the Closing does not occur as a result of any Party exercising its
      right to terminate pursuant to Section 11.01, then except as set forth in
      Section 11.03, this Agreement shall be null and void and no Party shall
      have any further rights or obligations under this Agreement, except as stated
      herein, and except that nothing herein shall relieve any Party from any
      liability for any breach hereof or any liability that has accrued prior to
      the
      date of such termination.

     

    Section
      11.03  Termination
      Damages. 

     

    
      	 	
              (a)

            	
              If
                all conditions precedent to the obligations of Buyer set forth in
                Article
                VIII have been met and the transactions contemplated by this Agreement
                are
                not consummated on or before the Closing Date because of the failure
                of
                Buyer to perform any of its material obligations hereunder or the
                breach
                of any representation herein by Buyer, then in such event, Seller
                shall
                have the option to terminate this Agreement, in which case Seller
                shall
                retain (i) all partial payments of the Purchase Price, (ii) intellectual
                property, data, reports of Buyer and Buyer’s agents and contractors
                related to the prospect, except to the extent said reports and data
                are
                not subject to the attorney-client or work-product privileges, and
                (iii)
                improvements, tools, equipment, and fixtures related to the prospect,
                all
                of (i) through (iii) to be deemed liquidated damages on account of
                Buyer’s
                failure to perform its obligations under this Agreement or Buyer’s breach
                of any representation under this Agreement, which remedy shall be
                the sole
                and exclusive remedy available to Seller for Buyer’s failure to perform or
                breach. Buyer shall also be responsible for paying the costs and
                expenses
                related to the Drilling Obligations, whether incurred prior to or
                after
                the Closing Date. 

            

    

     

    Section
      11.04  Attorneys’
      Fees, Etc.
      If
      either Party to this Agreement resorts to legal proceedings to enforce this
      Agreement, the prevailing Party in such proceedings shall be entitled to recover
      all costs incurred by such Party, including reasonable attorneys’ fees, in
      addition to any other relief to which such Party may be entitled.
      Notwithstanding anything to the contrary in this Agreement, in no event shall
      either Party be entitled to receive any punitive, indirect or consequential
      damages unless same are a part of a Third Party claim for which a Party is
      seeking indemnification hereunder, REGARDLESS
      OF WHETHER CAUSED OR CONTRIBUTED TO BY THE SOLE, JOINT, COMPARATIVE OR
      CONCURRENT NEGLIGENCE OR STRICT LIABILITY OF THE OTHER
      PARTY.

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    
      Article
        XII

      Post
        Closing Obligations

       

      Section
        12.01  Drilling
        Obligation.
        Buyer
        shall spud, drill and complete the well currently permitted as Skull Valley
        Federal 21-1, located in Section 21, T.3S., R.9W., SLM, on or before September
        1, 2008 (the “Drilling
        Obligation”),
        subject to the condition set forth below in Section 12.02 and the right of
        Buyer
        to pay Seller for one or more Extension Periods as set forth below in Section
        12.03. Until satisfaction of the Drilling Obligation by Buyer, Buyer shall
        not
        convey any interest in the Assets, or any part thereof, to any individual
        or
        entity without the prior written consent of Seller (except to a wholly-owned
        subsidiary of Buyer) and the execution of all documents necessary to secure
        Seller’s rights set forth under this Article. All costs associated with the
        maintenance of the Assets (including but not limited to payment of lease
        fees
        and rentals) and any and all costs, fees and expenses associated with and
        related to the drilling and completion (and plugging and abandonment, if
        necessary) of Skull Valley Federal 21-1 shall be borne by Buyer. Upon Seller’s
        request, Buyer agrees to provide Seller with information and documentation
        evidencing performance of, and payment for, the Drilling Obligation. To secure
        Buyer’s Drilling Obligations, Buyer shall deliver an Assignment and Bill of Sale
        for the benefit of Seller in the form attached hereto as Exhibit C, to be
        held
        in escrow by Seller until released in accordance with Sections 12.04 or 12.05
        below. 

       

      Section
        12.02  Delivery
        of Rig.
        In the
        event the Parties are unable to locate a drilling rig to attend the property
        pursuant to the time set out herein, the Parties agree that an extension
        will be
        granted for any such reasonable period as may be required (but not beyond
        March
        31, 2009) using diligent efforts, to locate and deliver the rig to the property
        and that upon delivery of the rig, the well be promptly drilled, logged and
        completed in accordance with the Drilling Obligation.

       

      Section
        12.03  Extension
        of Drilling Obligation.
        Buyer
        shall have the right to extend the deadline for completion of the Drilling
        Obligation by paying Seller one or more extension fees each in the amount
        of
        US$200,000.00 for each extension period, each of a three (3) month length,
        but
        in no event shall the Drilling Obligation deadline extend beyond March 31,
        2009.

       

      Section
        12.04  Satisfaction
        of Drilling Obligation.
        Upon
        satisfaction of, and payment for, the Drilling Obligation, Seller will deliver
        to Buyer the original of the Assignment and Bill of Sale executed by Buyer
        for
        the benefit of Seller, in the form attached hereto as Exhibit C. 

       

      Section
        12.05 
        Failure to Perform Drilling Obligation.
        If
        Buyer has not fully satisfied, and paid for, the Drilling Obligation in a
        timely
        manner, and in no event later than March 31, 2009, Buyer will have failed
        to
        perform its Drilling Obligation and will be in default. Seller shall deliver
        written notice to Buyer of the general nature of the default and Buyer shall
        have thirty (30) days after the date of Seller’s written notice within which to
        cure the default. If default is not cured within said thirty (30) day period,
        Seller may record and file all instruments necessary to re-convey the Assets
        to
        Seller, including the Assignment and Bill of Sale executed by Buyer for the
        benefit of Seller, in the form attached hereto as Exhibit C, and all of Buyer’s
        rights in and to the Assets shall be extinguished.

       

      
        
          
          

        

        
          -15-

          
            

          

        

        
          
          

        

      

    

     

    Section
      12.06  Further
      Cooperation.
      Seller
      shall make the Records available to be picked up by Buyer at the offices of
      Seller during normal business hours within fifteen (15) Business Days after
      the
      Closing to the extent the Records are in the possession of Seller and are not
      subject to contractual restrictions on transferability. Seller shall
      have the right to retain copies of any of the Records and the rights granted
      under Section 16.03. After
      the
      Closing Date, each Party, at the request of the other and without additional
      consideration, shall execute and deliver, or shall cause to be executed and
      delivered, from time to time such further instruments of conveyance and transfer
      and shall take such other action as the other Party may reasonably request
      to
      convey and deliver the Assets to Buyer and to accomplish the orderly transfer
      of
      the Assets to Buyer in the manner contemplated by this Agreement. After the
      Closing, the Parties will cooperate to have all proceeds received attributable
      to the Assets be paid to the proper Party hereunder and to have all expenditures
      to be made with respect to the Assets be made by the proper Party
      hereunder.

     

    Article
      XIII

    Operation
      of the Assets

     

    Section
      13.01  Operations
      after Execution Date. Seller
      agrees, from and after the Execution Date until Closing, except as expressly
      contemplated by this Agreement, as expressly consented to in writing by Buyer,
      or in situations wherein emergency action is taken in the face of risk to life,
      property or the environment, to maintain the books of account and records
      relating to the Assets in the usual, regular and ordinary manner, in accordance
      with its past practice, not enter into a material contract, or materially amend
      or change the terms of any such contract that would adversely impact the Assets,
      and preserve in full force and effect all oil and gas leases, operating
      agreements, easements, rights-of-way, permits, licenses and agreements that
      relate to the Assets.

     

    Section
      13.02  Limitations
      on the Operational Obligations and Liabilities of Seller.

     

    
      	 	
              (a)

            	
              From
                and after the date of execution of this Agreement and until the Closing,
                and subject to the provisions of applicable operating and other
                agreements, and further subject to the provisions of this Article
                XIII,
                Seller shall use its reasonable efforts to administer the Assets
                in a
                manner consistent with its past practices, and shall carry on its
                business
                with respect to the Assets in substantially the same manner as before
                execution of this Agreement. 

            

    

     

    
      	 	
              (b)

            	
              Notwithstanding
                anything to the contrary in this Article XIII, Seller shall have
                no
                liability to Buyer for, and Buyer hereby agrees to release, defend,
                indemnify and hold harmless Seller from, the incorrect payment of
                delay
                rentals, royalties, shut-in royalties or similar payments or for
                any
                failure to pay any such payments through mistake or oversight (INCLUDING
                THOSE RESULTING FROM SELLER’S SOLE, JOINT, COMPARATIVE OR CONCURRENT
                NEGLIGENCE OR STRICT LIABILITY)
                provided that such payments relate to production months after the
                Closing
                Date. In no event shall Buyer’s remedy for any Seller’s breach of its
                obligations under this Article XIII exceed the Allocated Value of
                the
                Subject Interest affected by such
                breach.

            

    

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    Section
      13.03  Operation
      of the Assets After the Closing.
      It is
      expressly understood and agreed that Seller shall not be obligated to operate
      any of the Assets following the Closing and Buyer hereby assumes full
      responsibility for operating (or causing the operation of) all Assets following
      the Closing. Without implying any obligation on Seller’s part to continue
      operating any Assets after the Closing, if Seller elects to continue to operate
      any Assets following the Closing at the request of Buyer or any Third Party
      working interest owner, due to constraints of applicable joint operating
      agreement(s), failure of a successor operator to take over operations or other
      reasonable cause, such continued operation by Seller shall be for the account
      of
      Buyer, at the sole risk, cost and expense of Buyer. Seller, as a part of the
      Assumed Obligations, is hereby released and indemnified by Buyer from all
      claims, losses, damages, costs, expenses, causes of action and judgments of
      any
      kind or character (INCLUDING
      THOSE RESULTING FROM SELLER’S SOLE, JOINT, COMPARATIVE OR CONCURRENT NEGLIGENCE
      OR STRICT LIABILITY)
      with
      respect to (a) such continued operations by Seller, (b) Buyer’s assumption of
      operations from Seller, and (c) compliance with the terms of any applicable
      joint operating agreement related to the election of a successor operator.
      Buyer
      shall conduct or cause to be conducted all operations on the Assets after
      Closing in a good and workmanlike manner and in compliance with all applicable
      laws, rules, regulations and agreements. 

     

    Section
      13.04  Risk
      of Loss; Casualty
      Loss.

     

    
      	 	
              (a)

            	
              After
                the Closing Date, Buyer shall assume all risk of loss with respect
                to, and
                any change in the condition of, the depreciation of personal property,
                and
                the depletion of Hydrocarbons even if caused by the watering-out
                of any
                well, the collapse of casing, or sand infiltration of
                wells.

            

    

     

    
      	 	
              (b)

            	
              Seller
                shall not be obligated to carry or maintain, and shall have no obligation
                or liability to Buyer for its failure to carry or maintain, any insurance
                coverage with respect to any of the Assets.

            

    

     

    Article
      XIV

    Obligations
      and Indemnification

     

    Section
      14.01  Retained
      Obligations.
      Provided that the Closing occurs, for a period of six (6) months from Closing,
      and not thereafter, Seller shall retain payment obligations of Seller that
      accrue and become due prior to the Closing Date, except to the extent that
      the
      same were incurred by Buyer, any breach of any representation, warranty,
      covenant or agreement of Seller contained in this Agreement, and all liability
      of Seller to third parties for personal injury or death to the extent occurring
      prior to the Closing Date as a result of the Seller’s operation of the Assets
      (collectively, the “Retained Obligations”). 

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    Section
      14.02  Assumed
      Obligations.
      Provided that the Closing occurs, Buyer hereby assumes all duties, obligations
      and liabilities of every kind and character with respect to the Assets or the
      ownership or operation thereof (other than the Retained Obligations), whether
      attributable to periods before or after the Closing Date, including, without
      limitation, those arising out of the terms of the Easements, Contracts, Leases,
      Personal Property or Subject Interests comprising part of the Assets, ad
      valorem, property, severance and other similar taxes or assessments based upon
      or measured by the ownership of the Assets or the production therefrom, the
      condition of the Subject Interests, regardless of whether such condition arose
      before or after the Closing Date, obligations to properly plug and abandon
      or
      re-plug or re-abandon or remove wells, flowlines, gathering lines or other
      facilities, equipment or other personal property or fixtures comprising part
      of
      the Assets, obligations to restore the surface of the Subject Interests and
      obligations to remediate or bring the Subject Interests into compliance with
      applicable Environmental Laws (including conducting any remediation activities
      that may be required on or otherwise in connection with activities on the
      Subject Interests), regardless of whether such obligations or conditions or
      events giving rise to such obligations, arose, occurred or accrued before or
      after the Closing Date, and any other duty, obligation, event, condition or
      liability assumed by Buyer under the terms of this Agreement (collectively,
      the
“Assumed Obligations”). 

     

    Section
      14.03  Buyer’s
      Indemnification.
      Provided that the Closing occurs, Buyer shall release, defend, indemnify and
      hold harmless Seller, its partners, and their respective officers, directors,
      employees, agents, partners, representatives, members, shareholders, affiliates,
      subsidiaries (collectively, the “Seller
      Indemnitees”)
      from
      and against any and all claims, damages, liabilities, losses, causes of action,
      costs and expenses (including, without limitation, those involving theories
      of
      negligence or strict liability and including court costs and attorneys’ fees)
      (collectively, the “Losses”) as a result of, arising out of, or related to the
      Assumed Obligations. 

     

    Section
      14.04 Seller’s
      Indemnification.
      Provided that the Closing occurs, Seller shall release, defend, indemnify and
      hold harmless Buyer, its partners, and their respective officers, directors,
      employees, agents, representatives, members, shareholders, affiliates and
      subsidiaries (collectively, the “Buyer
      Indemnitees”)
      from
      and against any and all Third Party claims relating to Seller’s ownership or
      operation of the Assets prior to the Closing Date as a result of, arising out
      of, or related to the Retained Obligations. Provided, however, notwithstanding
      anything to the contrary contained herein, Seller’s indemnification obligation
      under this Section 14.04 shall only apply if Buyer has provided Seller with
      written notice claiming indemnification within thirty (30) days prior to the
      expiration of Seller’s six (6) month indemnification period stated in Section
      14.01.

     

    Section
      14.05 Notices
      and Defense of Indemnified Matters.
      

     

    (a)
      Each
      Party shall promptly notify the other Party in writing of any matter of which
      it
      becomes aware and for which it is entitled to indemnification from the other
      Party under this Agreement. Upon receipt by a Seller Indemnitee or a Buyer
      Indemnitee (each, an “Indemnified
      Person”)
      of
      notice of a claim, action or proceeding against such Indemnified Person in
      respect of which indemnity may be sought hereunder, such Indemnified Person
      shall promptly notify Seller or Buyer, as the case may be, with respect thereto.
      In addition, an Indemnified Person shall immediately notify Seller or Buyer,
      as
      the case may be, after any action is commenced (by way of service with a summons
      or other legal process giving information as to the nature and basis of the
      claim) against such Indemnified Person. 

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    (b)
      Seller or Buyer, as the case may be, shall be entitled to assume the defense
      of
      any litigation or proceeding in respect of which indemnity may be sought
      hereunder, including the employment of counsel reasonably satisfactory to the
      other party and the payment of the fees and expenses of such counsel, in which
      event, except as provided below, Seller or Buyer shall not be liable for the
      fees and expenses of any other counsel retained by any Indemnified Person in
      connection with such litigation or proceeding. In any such litigation or
      proceeding the defense of which Seller or Buyer shall have so assumed, any
      Indemnified Person shall have the right to participate in such litigation or
      proceeding and to retain its own counsel, but the fees and expenses of such
      counsel shall be at the expense of such Indemnified Person unless (i) Seller
      or
      Buyer, as the case may be, and such Indemnified Person shall have mutually
      agreed in writing to the retention of such counsel, or (ii) the named parties
      to
      any such litigation or proceeding (including any impleaded parties) include
      Seller or Buyer, as the case may be, and such Indemnified Person and
      representation of both parties by the same counsel would, in the opinion of
      counsel to such Indemnified Person, be inappropriate due to actual or potential
      differing interests between Seller or Buyer, as the case may be, and such
      Indemnified Person. 

    

    (c)
      Seller or Buyer, as the case may be, shall not be liable for any settlement
      of
      any litigation or proceeding effected without its written consent, but if
      settled with such consent or if there be a final judgment for the claimant
      against the Indemnified Person, Seller or Buyer, as the case may be, agrees
      to
      indemnify the Indemnified Person from and against any loss or liability by
      reason of such settlement or judgment. Seller or Buyer, as the case may be,
      will
      not settle any claim, action or proceeding in respect of which indemnity may
      be
      sought hereunder, whether or not any Indemnified Person is an actual or
      potential party to such claim, action or proceeding, without the Indemnified
      Person’s written consent, which shall not be unreasonably withheld, delayed, or
      conditioned. The provisions contained in this Section 14.06 shall remain
      operative and in full force and effect regardless of the expiration or any
      termination of the Agreement.

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    Article
      XV

    Limitations
      on Representations and Warranties

     

    Section
      15.01  Disclaimers
      of Representations and Warranties.
      The
      express representations and warranties of Seller contained in this Agreement
      are
      exclusive and are in lieu of all other representations and warranties, express,
      implied or statutory. EXCEPT
      FOR THE EXPRESS REPRESENTATIONS OF SELLER IN THIS AGREEMENT,
BUYER
      ACKNOWLEDGES THAT SELLER HAS NOT MADE, AND SELLER HEREBY EXPRESSLY DISCLAIMS
      AND
      NEGATES, AND BUYER HEREBY EXPRESSLY WAIVES, ANY REPRESENTATION OR WARRANTY,
      EXPRESS, IMPLIED, AT COMMON LAW, BY STATUTE OR OTHERWISE RELATING TO (a)
      PRODUCTION RATES, RECOMPLETION OPPORTUNITIES, DECLINE RATES, GAS BALANCING
      INFORMATION OR THE QUALITY, QUANTITY OR VOLUME OF THE RESERVES OF HYDROCARBONS,
      IF ANY, ATTRIBUTABLE TO THE ASSETS, (b) THE ACCURACY, COMPLETENESS OR
      MATERIALITY OF ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR ORAL) NOW,
      HERETOFORE OR HEREAFTER FURNISHED TO BUYER BY OR ON BEHALF OF SELLER, AND (c)
      THE ENVIRONMENTAL CONDITION OF THE ASSETS. EXCEPT
      FOR THE EXPRESS REPRESENTATIONS OF SELLER IN THIS AGREEMENT,
SELLER
      EXPRESSLY DISCLAIMS AND NEGATES, AND BUYER HEREBY WAIVES, AS TO PERSONAL
      PROPERTY, EQUIPMENT, INVENTORY, MACHINERY AND FIXTURES CONSTITUTING A PART
      OF
      THE ASSETS (i) ANY IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY, (ii) ANY
      IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, (iii) ANY
      IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR SAMPLES OF MATERIALS,
      (iv) ANY RIGHTS OF PURCHASERS UNDER APPROPRIATE STATUTES TO CLAIM DIMINUTION
      OF
      CONSIDERATION OR RETURN OF THE PURCHASE PRICE, (v) ANY IMPLIED OR EXPRESS
      WARRANTY OF FREEDOM FROM DEFECTS, WHETHER KNOWN OR UNKNOWN, (vi) ANY AND ALL
      IMPLIED WARRANTIES EXISTING UNDER APPLICABLE LAW, AND (vii) ANY IMPLIED OR
      EXPRESS WARRANTY REGARDING ENVIRONMENTAL LAWS, THE RELEASE OF MATERIALS INTO
      THE
      ENVIRONMENT, OR PROTECTION OF THE ENVIRONMENT OR HEALTH, IT BEING THE EXPRESS
      INTENTION OF BUYER AND SELLER THAT THE PERSONAL PROPERTY, EQUIPMENT, INVENTORY,
      MACHINERY AND FIXTURES INCLUDED IN THE ASSETS SHALL BE CONVEYED TO BUYER, AND
      BUYER SHALL ACCEPT SAME, AS IS, WHERE IS, WITH ALL FAULTS AND IN THEIR PRESENT
      CONDITION AND STATE OF REPAIR AND BUYER REPRESENTS TO SELLER THAT BUYER WILL
      MAKE OR CAUSE TO BE MADE SUCH INSPECTIONS WITH RESPECT TO SUCH PERSONAL
      PROPERTY, EQUIPMENT, INVENTORY, MACHINERY AND FIXTURES AS BUYER DEEMS
      APPROPRIATE. SELLER AND BUYER AGREE THAT, TO THE EXTENT REQUIRED BY APPLICABLE
      LAW TO BE EFFECTIVE, THE DISCLAIMERS OF CERTAIN WARRANTIES CONTAINED IN THIS
      SECTION ARE “CONSPICUOUS” DISCLAIMERS FOR THE PURPOSES OF ANY APPLICABLE LAW,
      RULE OR ORDER.

     

    Section
      15.02  Independent
      Investigation.
      Buyer
      represents and acknowledges that it is knowledgeable of the oil and gas business
      and of the usual and customary practices of producers such as Seller and that
      it
      has had access to the Assets, the officers and employees of Seller, and the
      books, records and files of Seller relating to the Assets, and in making the
      decision to enter into this Agreement and consummate the transactions
      contemplated hereby, Buyer has relied solely on the basis of its own independent
      due diligence investigation of the Assets and upon the representations and
      warranties made in Article V, and not on any other representations or warranties
      of Seller or any other person or entity.

     

    Section
      15.03  Survival.
      The
      representations, warranties, covenants and obligations of Buyer under this
      Agreement shall survive the Closing indefinitely. The representations,
      warranties, covenants and obligations of Seller under this Agreement shall
      survive the Closing for a period of six (6) months from the
      Closing.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    Article
      XVI

    Miscellaneous

     

    Section
      16.01  Names.
      Subject
      to the terms of this Agreement, as soon as reasonably possible after the
      Closing, but in no event later than sixty (60) days after the Closing, Buyer
      shall remove the names of Seller and its affiliates, and all variations thereof,
      from all of the Assets and make the requisite filings with, and provide the
      requisite notices to, the appropriate federal, state or local agencies to place
      the title or other indicia of ownership, including operation of the Assets,
      in a
      name other than the name of the Seller or any of its affiliates, or any
      variations thereof.

     

    Section
      16.02  Expenses.
      Except
      as specifically provided in this Agreement, each Party shall be solely
      responsible for all expenses, including due diligence expenses, incurred by
      it
      in connection with this transaction, and neither Party shall be entitled to
      any
      reimbursement for such expenses from the other Party.

     

    Section
      16.03  Document
      Retention.
      As used
      in this Section 16.03, the term “Documents”
shall
      mean all files, documents, books, records and other data delivered to Buyer
      by
      Seller pursuant to the provisions of this Agreement (other than those that
      Seller has retained either the original or a copy of), including, but not
      limited to: financial and tax accounting records; land, title and division
      of
      interest files; contracts; engineering and well files; and books and records
      related to the operation of the Assets prior to the Closing Date. Buyer shall
      retain and preserve the Documents for a period of no less than four (4) years
      following the Closing Date (or for such longer period as may be required by
      law
      or governmental regulation), and shall allow Seller or its representatives
      to
      inspect the Documents at reasonable times and upon reasonable notice during
      regular business hours during such time period. Seller shall have the right
      during such period to make copies of the Documents at its expense.

     

    Section
      16.04  Entire
      Agreement.
      This
      Agreement, the documents to be executed hereunder, and the exhibits attached
      hereto constitute the entire agreement between the Parties pertaining to the
      subject matter hereof and supersede all prior agreements, understandings,
      negotiations and discussions, whether oral or written, of the Parties pertaining
      to the subject matter hereof. No supplement, amendment, alteration, modification
      or waiver of this Agreement shall be binding unless executed in writing by
      the
      Parties and specifically referencing this Agreement.

     

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

     

    Section
      16.06  Publicity.
      Prior
      to Closing, neither Seller nor Buyer will issue any public announcement or
      press
      release concerning this transaction without the written consent of the other
      Party, which consent shall not be unreasonably withheld (except as required
      by
      law and in such case with prior written agreement between the Parties on the
      wording of the announcement or press release).

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

    Section
      16.07  Construction.
      The
      captions in this Agreement are for convenience only and shall not be considered
      a part of or affect the construction or interpretation of any provision of
      this
      Agreement. The Parties acknowledge that they have participated jointly in the
      negotiation and drafting of this Agreement and as such the Parties agree that
      if
      an ambiguity or question of intent or interpretation arises hereunder, this
      Agreement shall not be construed more strictly against one Party than another
      on
      the grounds of authorship. 

     

    Section
      16.08  No
      Third Party Beneficiaries.
      Nothing
      in this Agreement shall provide any benefit to any Third Party or entitle
      any
      Third
      Party to any claim, cause of action, remedy or right of any kind, it being
      the
      intent of the Parties that this Agreement shall otherwise not be construed
      as a
      Third Party beneficiary contract.

     

    Section
      16.09  Assignment.
      Neither
      Party may assign or delegate any of its rights or duties hereunder without
      the
      prior written consent of the other Party and any assignment made without such
      consent shall be void. Except as otherwise provided herein, this Agreement
      shall
      be binding upon and inure to the benefit of the Parties hereto and their
      respective permitted successors, assigns and legal representatives.

     

    Section
      16.10  Governing
      Law.
      This
      Agreement, other documents delivered pursuant hereto and the legal relations
      between the Parties shall be governed and construed in accordance with the
      laws
      of the State of Wyoming, without giving effect to principles of conflicts of
      laws that would result in the application of the laws of another jurisdiction.
      The Parties agree to venue in Natrona County, Wyoming.

     

    Section
      17.11 Notices.

    

    (a)
      Method.
      All
      notices and other communications provided for or permitted under this Agreement
      shall be made in writing by (i) hand-delivery, (ii) first class mail, or air
      courier guaranteeing rapid delivery (FedEx, DHL, TNT, etc.) to the addresses
      of
      Seller and Buyer set forth below. 

    

    
      	
              Seller:

            	
              Geochem
                Exploration, LLC

              P.O.
                Box 356

              Casper,
                WY 82602

            
	 	 
	
              Buyer:

            	
              Ameriwest
                Energy Corp.

            
	 	
              123
                West 1st
                Ave., Suite 215Casper, Wyoming
                82601

            

    

    

    (b)
      Effectiveness.
      All
      such notices and communications shall be deemed to have been duly given (i)
      at
      the time delivered by hand, if personally delivered, (ii) five (5) Business
      Days
      after being deposited in the mail, postage prepaid, if mailed, (iii) when
      receipt acknowledged, if telecopied, and (iv) when receipt acknowledged, if
      sent
      by air courier guaranteeing rapid delivery (FedEx, DHL, TNT, etc.). Either
      Party
      may, by written notice so delivered to the other Party, change its address
      for
      notice purposes hereunder.

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

     

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

     

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

     

    Section
      17.14 Counterpart
      Execution.
      This
      Agreement may be executed in any number of counterparts, and each counterpart
      hereof shall be effective as to each party that executes the same whether or
      not
      all of such parties execute the same counterpart. If counterparts of this
      Agreement are executed, the signature pages from various counterparts may be
      combined into one composite instrument for all purposes. All counterparts
      together shall constitute only one Agreement, but each counterpart shall be
      considered an original.

     

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

     

    
      	 	
              SELLER:

            
	 	 
	 	
              GEOCHEM
                EXPLORATION, LLC

            
	 	 
	 	
              By: 

            	 
	 	
              Name:
                Walter R. Merschat

            
	 	
              Title:
                Member Manager

            
	 	 
	 	
              BUYER:

            
	 	 
	 	
              AMERIWEST
                ENERGY CORP.

            
	 	 
	 	
              By:
                

            	 
	 	
              Name:
                Jon Nicolaysen

            
	 	
              Title:
                Director

            

    

    

    
      
        
        

      

      
        -23-THIRD
      AMENDMENT TO LETTER OF INTENT 

     

    THIS
      AMENDMENT is
      dated
      and effective this 31st
      day of
      May, 2008.

     

    BETWEEN:

    AMERIWEST
      ENERGY CORP., a
      Nevada
      Corporation, having an address of 123 West 1st
      Street,
      Suite 215, Casper, Wyoming, USA, 82601 hereinafter referred to as
      "Ameriwest")

     

    AND:

    MUDDY
      MINERAL EXPLORATION, LLC, a
      Wyoming
      limited liability company having an address at PO Box 459, Casper, Wyoming,
      USA,
      82602 hereinafter referred to as "Muddy")

     

    WHEREAS
      Pin
      Petroleum Partners Inc. ("Pin") and Muddy entered into a Letter of Intent dated
      July 18, 2007 and a First Amendment to the Letter of Intent dated October 1,
      2007 (collectively referred to herein as the “LOI”) wherein PIN was to acquire
      and Muddy was to sell to Pin its working interest and net royalty interest
      in
      and to the South Glenrock field in Converse County, Wyoming (the "Interest"
      or
      the "Assets"), in exchange for the payment to Muddy a total purchase price
      of
      US$5,000,000;

     

    AND
      WHEREAS, the
      interests, rights and obligations of PIN in and to the LOI have been assigned
      to
      Ameriwest pursuant to a Second Amendment to Letter of Intent dated March 19,
      2008;

     

    AND
      WHEREAS the
      parties now wish to further amend the terms of the LOI to reflect the current
      terms of purchase.

     

    NOW
      THEREFORE, in
      consideration of the premises, promises and covenants contained herein, the
      parties hereto agree as follows:

     

    
      	1.	
              Extension
                of Dates

            

    

     

    
      	
              (a)

            	
              The
                parties hereto agree to extend the date by which the parties are
                to enter
                into a definitive agreement from May 1, 2008 to August 1,
                2008.

            

    

     

    
      	
              (b)

            	
              Closing
                shall occur on or before September 1,
                2008.

            

    

     

    
      	2.	
              Payments
                to Muddy

            

    

     

    
      	
              (a)

            	
              As
                part of the total purchase price, the amount of US$1,750,000 has
                been
                previously paid and disbursed to Muddy, and said amount is deemed
                earned
                and is non-refundable, but will be credited against the purchase
                price at
                Closing.

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              (b)

            	
              The
                parties hereto agree that the payment to Muddy of the remaining purchase
                price in the amount of US$3,250,000 (hereinafter "Remaining Payment")
                shall occur on or before September 1,
                2008.

            

    

     

    
      	
              (c)

            	
              In
                consideration of the extension of the dates as stated herein, upon
                execution of this Amendment by Muddy, Ameriwest will pay
                Muddy:

            

    

     

    
      	 	
              (i)

            	
              the
                sum of US$194,575.34, which shall be earned by Muddy as of the effective
                date of this Amendment, non-refundable and not credited against the
                purchase price; and

            

    

    

    
      	 	
              (ii)

            	
              the
                sum of US$105,424.66, which represents accrued interest on the Remaining
                Payment from January 4, 2008 through May 31, 2008, which shall he
                earned
                by Muddy as of the effective date of this Amendment, non-refundable
                and
                not credited against the purchase
                price.

            

    

     

    
      	3.	
              Time
                of the Essence

            

    

     

    Time
      shall he of the essence with respect to all time periods and notice periods
      set
      forth in the LOI and this Amendment.

     

    
      	4.	
              Counterpart
                Execution

            

    

     

    This
      Amendment may he executed in any number of counterparts, and each counterpart
      hereof shall be effective as to each party that executes the same whether or
      not
      all of such parties execute the same counterpart. If counterparts of this
      Amendment are executed, the signature pages from various counterparts may be
      combined into one composite instrument for all purposes. All counterparts
      together shall constitute only one Amendment, but each counterpart shall be
      considered an original.

     

    
      	5.	
              Entire
                Agreement

            

    

     

    The
      LOI
      and this Amendment constitute the entire agreement between the Parties
      pertaining to the subject matter hereof and supersede all prior agreements,
      understandings, negotiations and discussions, whether oral or written, of the
      Parties pertaining to the subject matter hereof. No supplement, amendment,
      alteration, modification or waiver of the LOI or this Amendment shall be binding
      unless executed in writing by the Parties.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, the
      parties hereto have executed this Amendment as of the day and year first above
      written.

     

    
      	
              AMERIWEST
                ENERGY CORP.

            
	 	 
	
               

               

            	 
	
              Per:
                Authorized Signatory

            
	 	 
	 	 
	
              MUDDY
                MINERAL EXPLORATION LLC

            
	 	 
	
               

            	 
	
              Per:
                Authorized Signatory

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