Document:

ex2_2.htm

    

    Stock
Purchase Agreement

    

    This
Stock Purchase Agreement (“Agreement”)
is made as of February 14, 2008, by and between (i) Best Energy Services, Inc.,
a Nevada corporation (“Buyer”),
and (ii) Robert L. Beeman, a resident of Moab, Utah (“Seller”).

    

    Recitals

    

    Seller owns all of the issued and
outstanding shares of capital stock of Bob Beeman Drilling Company, a Utah
corporation (the
“Company”).

    

    Seller desires to sell, and Buyer
desires to purchase, all of the issued and
outstanding shares of capital stock of the Company, all of which are owned by
Seller (the “Purchased
Shares”), for the consideration and on the terms set forth in this
Agreement.

    

    Agreement

    

    In consideration of the foregoing and
the respective representations, warranties, covenants and agreements set forth
below, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties, intending to be
legally bound, agree as follows:

    

    Article
I

    Definitions

     

    1.1 Definitions.
For purposes of this Agreement, the following terms have the meanings specified
or referred to in this Article
I:

    

    “Accounts
Receivable” – as
defined in Section
3.4(b).

    

    “Agreement” – as defined in the Preamble
of this Agreement.

    

    “Balance
Sheet” – as
defined in Section
3.4(a).

    

    “Board of
Directors” – as
defined in Section
3.2(b)(i).

    

    “Buyer” – as defined in the Preamble
of this Agreement.

    

    “Buyer’s Closing
Documents” – as
defined in Section
4.2(a).

    

    “Closing” – as defined in Section
2.3.

    

    “Closing
Date” – as defined in Section 2.3.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    “Company” – as defined in the Recitals
of this Agreement.

    

    “Consent” – any approval, consent,
ratification, waiver, or other authorization (including any Governmental
Authorization).

    

    “Contemplated
Transactions” –
all of the transactions contemplated by this Agreement, including: (a) the sale
of the Purchased Shares by Seller to Buyer; (b) the execution, delivery, and
performance of the Seller’s Release, the Noncompetition Agreement, the Yard
Lease Agreement, the Escrow Agreement and all other documents or agreements
executed, delivered and performed in connection with this Agreement; and (c) the
performance by Buyer and Seller of their respective covenants and obligations
under this Agreement.

    

    “Contract” – any agreement, contract,
obligation, promise, or undertaking (whether written or oral and whether express
or implied) that is legally binding.

    

    “Damages” – as defined in Section
7.2.

    

    “Disclosure
Schedule” – the
disclosure schedule delivered by Seller to Buyer concurrently with the execution
and delivery of this Agreement.

    

    “Effective
Time” – as
defined in Section
2.3.

    

    “Encumbrance” – any charge, claim,
community property interest or similar equitable interest, lien, option, pledge,
security interest, right of first refusal, or restriction of any kind, including
any restriction on use, voting, transfer, receipt of income, or exercise of any
other attribute of ownership.

    

    “Escrow
Agent” – as
defined in Section
2.4(v).

    

    “Escrow
Agreement” – as
defined in Section
2.4(vi).

    

    “Facilities” – any real property,
leaseholds, or other interests in real property currently or formerly owned or
operated by the Company and any buildings, plants or structures currently or
formerly owned or operated by the Company. 

    

    “GAAP” – generally accepted United
States accounting principles, including the statements and interpretations of
the U.S. Financial Accounting Standards Board.

    

    “Governmental
Authorization” –
any approval, consent, license, permit, waiver, or other authorization issued,
granted or given by or under the authority of any Governmental Body or pursuant
to any Legal Requirement.

    

    “Governmental
Body” – any: (a)
federal, state, local, municipal, foreign, or other government; (b) governmental
or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other
tribunal); (c) multi-national organization or body; or (d) body properly
exercising, or entitled to exercise, any 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    administrative,
executive, judicial, legislative, police, regulatory, or taxing authority or
power of any nature.

    

    “Indemnification
Escrow Amount” –
as defined in Section
2.2.

    

    “Indemnified
Persons” – as
defined in Section
7.2.

    

    “Interim Balance
Sheet” – as
defined in Section
3.4(a).

    

    “Law” – any statute, law, rule,
regulation, ordinance or other pronouncement having the effect of law of any
Governmental Body.

    

    “Legal
Requirement” –
any federal, state, local, municipal, foreign, international, multinational, or
other administrative order, constitution, Law, principle of common law, or
treaty.

    

    “Material
Contract” – as
defined in Section
3.11(a).

    

    “Net Working
Capital” – the
Company’s current assets (excluding cash) minus the Company’s current
liabilities.

    

    “Noncompetition
Agreement” – as
defined in Section
2.4(a)(iii).

    

    “Note
Consideration” –
as defined in Section
2.2.

    

    “Order” – any award, decision,
injunction, judgment, order, ruling, subpoena, or verdict entered, issued, made,
or rendered by any court, administrative agency, or other Governmental Body or
by any arbitrator.

    

    “Ordinary Course
of Business” – an
action taken by a Person will be deemed to have been taken in the “Ordinary
Course of Business” only if such action is taken in the ordinary course of the
normal day-to-day operations of such Person.

    

    “Organizational
Documents” – (a)
the articles or certificate of incorporation and the bylaws of a corporation;
(b) the partnership agreement and any statement of partnership of a general
partnership; (c) the limited partnership agreement and the certificate of
limited partnership of a limited partnership; (d) any charter or similar
document adopted or filed in connection with the creation, formation, or
organization of a Person; and (e) any amendment to any of the
foregoing.

    

    “Payment
Instruction Letter”
– as defined in Section
2.4(b)(vi).

    

    “Person” – any individual,
corporation (including any non-profit corporation), general or limited
partnership, limited liability company, joint venture, estate, trust,
association, organization, labor union, or other entity or Governmental
Body.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    “Proceeding” – any action, arbitration,
audit, hearing, investigation, litigation, or suit (whether civil, criminal,
administrative, investigative, or informal) commenced, brought, conducted, or
heard by or before, or otherwise involving, any Governmental Body or
arbitrator.

    

    “Purchase
Price” – as
defined in Section
2.2.

    

    “Purchased
Shares” – as
defined in the Recitals of this Agreement.

    

    “Related
Person” – with
respect to a particular individual: (a) each other member of such individual's
Family; (b) any Person that is directly or indirectly controlled by such
individual or one or more members of such individual's Family; and (c) any
Person with respect to which such individual or one or more members of such
individual's Family serves as a director, officer, partner, executor, or trustee
(or in a similar capacity). With respect to a specified Person other than an
individual: (a) any Person that directly or indirectly controls, is directly or
indirectly controlled by, or is directly or indirectly under common control with
such specified Person; (b) each Person that serves as a director, officer,
partner, executor, or trustee of such specified Person (or in a similar
capacity); and (c) any Related Person of any individual described in clause (b).
For purposes of this definition, the “Family” of
an individual includes (i) the individual, (ii) the individual's spouse, (iii)
any other natural person who is related to the individual or the individual's
spouse within the second degree, and (iv) any other natural person who resides
with such individual.

    

    “Representative” – with respect to a
particular Person, any director, officer, employee, agent, consultant, advisor,
broker, or other representative of such Person, including legal counsel,
accountants, and financial advisors.

    

    “Securities
Act” – the
Securities Act of 1933 or any successor law, and regulations and rules issued
pursuant to that Act or any successor law.

    

    “Seller” – as defined in the Preamble
of this Agreement.

    

    “Seller
Contract” – any
Contract (a) under which the Company has or may acquire any rights, (b) under
which the Company has or may become subject to any obligation or liability, or
(c) by which the Company or any of the assets owned or used by the Company is or
may become bound.

    

    “Seller’s Closing
Documents” – as
defined in Section
3.2(a).

    

    “Seller’s
Release” – as
defined in Section
2.4(a)(ii).

    

    “Subsidiary” – with respect to any Person
(the “Owner”),
any corporation or other Person of which securities or other interests having
the power to elect a majority of that corporation's or other Person's board of
directors or similar governing body, or otherwise having the power to direct the
business and policies of that corporation or other Person (other than securities
or other interests having such power only upon the happening of a contingency
that has not occurred), are held by the Owner or one or more of its
Subsidiaries; when used without 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    reference
to a particular Person, “Subsidiary” means a Subsidiary of the
Company.

    

    “Yard Lease
Agreement” – as
defined in Section
2.4(a)(iv).

    

    1.2           Usage.

    

    (a) Interpretation.  In
this Agreement, unless a clear contrary intention appears: (i) the singular
number includes the plural number and vice versa; (ii) reference to any Person
includes such Person’s successors and assigns but, if applicable, only if such
successors and assigns are not prohibited by this Agreement, and reference to a
Person in a particular capacity excludes such Person in any other capacity or
individually; (iii) reference to any gender includes each other gender; (iv)
reference to any agreement, document or instrument means such agreement,
document or instrument as amended or modified and in effect from time to time in
accordance with the terms thereof; (v) reference to any Legal Requirement means
such Legal Requirement as amended, modified, codified, replaced or reenacted, in
whole or in part, and in effect from time to time, including rules and
regulations promulgated thereunder, and reference to any section or other
provision of any Legal Requirement means that provision of such Legal
Requirement from time to time in effect and constituting the substantive
amendment, modification, codification, replacement or reenactment of such
section or other provision; (vi) “hereunder,”
“hereof,”
“hereto,”  and
words of similar import shall be deemed references to this Agreement as a whole
and not to any particular Article, Section or other provision hereof; (vii)
“including”
(and with correlative meaning “include”) means including without limiting the
generality of any description preceding such term; (viii) “or” is
used in the inclusive sense of “and/or”; (ix) references herein to an “Article”
or “Section”
without further reference to another agreement shall mean the specified Article
or Section of this Agreement; (x) with respect to the determination of any
period of time, “from”
means “from and including” and “to” means
“to but excluding”; and (xii) references to documents, instruments or agreements
shall be deemed to refer as well to all addenda, exhibits, schedules or
amendments thereto.

    

    (b) Accounting
Terms and Determinations.  Unless otherwise specified herein,
all accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.

    

    (c) Legal
Representation of the Parties.  This Agreement has been jointly
drafted by the parties hereto and the parties have had an opportunity to review
this Agreement with counsel and no rule of construction strictly construing this
Agreement against the drafter shall be applied by a court of competent
jurisdiction.

     

    

    Article
II

    Sale and Transfer of
Purchased Shares; Closing

     

    2.1 Purchase
and Sale of
Purchased Shares. Subject to the terms and
conditions of this Agreement, at the Closing, Seller will sell, transfer and
deliver the Purchased Shares to 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Buyer,
free and clear of any Encumbrance, and Buyer will purchase all of the Purchased
Shares from Seller.

     

    2.2 Purchase
Price.  The aggregate purchase price for the Purchased Shares
will be $4,750,000 (the “Purchase
Price”). In accordance with Section 2.4(b),
at the Closing, the Purchase Price shall be delivered by Buyer as follows: (a)
$200,000 previously paid to Seller by Buyer as a deposit; (b) $500,000 (the
“Indemnification
Escrow Amount”) paid to the Escrow Agent pursuant to the Escrow Agreement
with respect to the escrow for the indemnification obligations of Seller and
Shareholders set forth in Article VII; and (c)
$4,050,000 (the “Note
Consideration”) by payment by Buyer to Seller by a demand promissory
note, in a form mutually acceptable to Buyer and Seller (the “Demand Note
Consideration”). The Indemnification Escrow Amount shall be paid in
accordance with the Section 7.5, Section 7.6 and the
Escrow Agreement.

     

    2.3 Closing.  The
purchase and sale provided for in this Agreement (the “Closing”)
will take place at the offices of Buyer’s counsel at 901 Main Street, Suite
6000, Dallas, Texas, on February 14, 2008, or such other place agreed to by
Buyer and Seller.  The Closing shall be deemed to have occurred at
11:59 p.m. C.S.T. (the “Effective
Time”) on the date on which the Closing actually takes place (the “Closing
Date”).

     

    2.4 Closing
Obligations.  At the Closing:

     

    (a) Seller
will deliver to Buyer: (i) certificates representing the Purchased Shares, duly
endorsed (or accompanied by duly executed stock powers) for transfer to Buyer;
(ii) a release, in the form mutually acceptable to Buyer and Seller, executed by
Seller (the “Seller’s
Release”); (iii) a noncompetition agreement, in the form mutually
acceptable to Buyer and Seller, executed by Seller (the “Noncompetition
Agreement”); (iv) a lease agreement with respect to Price and Moab yards,
in the form mutually acceptable to Buyer and Seller, executed by the Company
(the “Yard
Lease Agreement”); and (v) an escrow agreement, in the form mutually
acceptable to Buyer, Seller and JPMorgan Chase Bank, N.A. (the “Escrow
Agent”), executed by Seller (the “Escrow
Agreement”).

     

     

    (b) Buyer
will deliver to Seller: (i) the Note Consideration, by delivery of the Demand
Note; (ii) the Noncompetition Agreement, executed by Buyer; (iii) the Yard Lease
Agreement, executed by Buyer; (v) the Escrow Agreement, executed by Buyer, and
(vi) the payment instruction letter, in a form mutually acceptable to Buyer and
Seller, executed by Buyer (the “Payment
Instruction Letter”).

     

    

    (c)           Buyer
will deliver to the Escrow Agent, the Indemnification Escrow Amount, by wire
transfer to an account specified by the Escrow Agent.

    

    Article
III

    Representations and
Warranties of Seller

    

    Except with respect to each section in
this Article III for
such disclosures as are set forth (i) in the section of the Disclosure
Schedule corresponding to such section in this Article III, or

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (ii) in
any other section of the Disclosure Schedule to the extent it is reasonably
apparent from the face of such disclosure that such disclosure qualifies such
section in this Article III,
Seller represents and warrants to Buyer, as follows:

     

    3.1 Organization
and Good Standing.

     

     

    (a) The
Company is a corporation, duly organized, validly existing and in good standing
under the laws of the State of Utah, with full corporate power and authority to
conduct its business as it is now being conducted, to own or use the properties
and assets that the Company purports to own or use, and to perform all of its
obligations under the Seller Contracts. The Company is duly qualified to do
business and is in good standing under the laws of each jurisdiction in which
either the ownership or use of the properties owned or used by the Company, or
the nature of the activities conducted by the Company, requires such
qualification.

     

    (b) Seller
has delivered or made available to Buyer copies of the Organizational Documents
of the Company, as currently in effect.

     

    3.2 Authority; No
Conflict.

     

    (a) This
Agreement constitutes the legal, valid, and binding obligation of Seller,
enforceable against Seller in accordance with its terms. Upon the execution and
delivery by Seller of the Seller’s Release, the Noncompetition Agreement, the
Yard Lease Agreement, the Escrow Agreement and all other documents or agreements
executed by Seller in connection herewith, (collectively, the “Seller’s Closing
Documents”), the Seller’s Closing Documents will constitute the legal,
valid, and binding obligations of Seller, enforceable against Seller in
accordance with their respective terms. Seller has the absolute and unrestricted
right, power, authority, and capacity to execute and deliver this Agreement and
the Seller’s Closing Documents and to perform its obligations under this
Agreement and the Seller’s Closing Documents.

    

    (b) The
consummation or performance of any of the Contemplated Transactions by the
Company will not directly or indirectly (with or without notice or lapse of
time): (i) contravene, conflict with, or result in a violation of (A) any
provision of the Organizational Documents of the Company, or (B) any resolution
adopted by the board of directors (the “Board of
Directors”) or the shareholders of the Company; (ii) contravene, conflict
with, or result in a violation of, or give any Governmental Body or other Person
the right to challenge any of the Contemplated Transactions or to exercise any
remedy or obtain any relief under, any Legal Requirement or any Order to which
the Company, or any of the assets owned or used by the Company, may be subject;
(iii) contravene, conflict with, or result in a violation of any of the terms or
requirements of, or give any Governmental Body the right to revoke, withdraw,
suspend, cancel, terminate, or modify, any Governmental Authorization that is
held by the Company; (iv) cause Buyer or the Company to become subject to, or to
become liable for the payment of, any tax; (v) cause any of the assets owned by
the Company to be reassessed or revalued by any taxing authority or other
Governmental Body; (vi) contravene, conflict with, or result in a violation or
breach of any material provision of, or give any Person the right to declare a
default or exercise any remedy under, or to accelerate the maturity or
performance of, or to 

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    cancel,
terminate, or modify, any material Seller Contract; or (vii) result in the
imposition or creation of any Encumbrance upon or with respect to any of the
assets owned or used by the Company. Neither the Seller nor the Company is or
will be required to give any notice to or obtain any Consent from any Person in
connection with the execution and delivery of this Agreement or the consummation
or performance of any of the Contemplated Transactions.

    

    (c)           Neither
the execution and delivery of this Agreement or Seller’s Closing Documents by
Seller nor the consummation or performance of any of the Contemplated
Transactions by Seller will, directly or indirectly (with or without notice or
lapse of time): (i) contravene, conflict with, or result in a violation of, or
give any Governmental Body or other Person the right to challenge any of the
Contemplated Transactions or to exercise any remedy or obtain any relief under,
any Legal Requirement (other than any merger control or antitrust Legal
Requirement that may be applicable) or any Order to which Seller may be subject;
(ii) cause Buyer or the Company to become subject to, or to become liable for
the payment of, in each case with respect to the transfer of the Purchased
Shares, any share transfer tax or real property transfer tax based upon the
transfer of a controlling interest in real property, in each case to any
Governmental Body; or (iii) result in the imposition or creation of any
Encumbrance upon or with respect to the Purchased Shares of Seller. Seller is
not, nor or will Seller be, required to give any notice to or obtain any Consent
from any Person in connection with the execution and delivery of this Agreement
by Seller or the consummation or performance of any of the Contemplated
Transactions by Seller.

     

    
      	
              3.3  

            	
              Capitalization;
      Ownership; Subsidiaries.

            

    

     

    (a) The
authorized equity securities of the Company consist of 100,000 shares of common
stock, par value $1.00 per share (the “Common
Shares”),
of which all 100,000
Common Shares are issued and outstanding, all of which are owned by
Seller. There are no warrants, options or other agreements for the purchase of
any capital stock of the Company outstanding as of the date of this Agreement.
All of the outstanding equity securities of the Company have been duly
authorized and validly issued and are fully paid and nonassessable. There are no
Contracts to which the Company is a party relating to the issuance, sale, or
transfer of any equity securities of the Company or other securities of the
Company. None of the outstanding equity securities or other securities of the
Company was issued in violation of the Securities Act or any other applicable
Legal Requirement.

    

    (b) Seller
represents that (i) on the Closing Date Seller will be the record and beneficial
owner and holder of the Purchased Shares, free and clear of all Encumbrances,
and (ii) except for this Agreement, there are no Contracts to which Seller is a
party relating to the sale or transfer of the Purchased Shares.

    

    (c) The
Company does not own, or have any Contract to acquire, any equity securities or
other securities of any Person (other than the Company) or any direct or
indirect equity or ownership interest in any other business.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              3.4  
      

            	
              Financial
      Statements.

            

    

     

                                     
(a)            The
Company has delivered to Buyer: (a) the audited balance sheet of the Company as
at December 31, 2006, and the related audited statements of operations, changes
in stockholders' equity, and cash flows for the fiscal year then ended and for
the fiscal year ended December 31, 2005 (including the notes thereto), all of
which were prepared in accordance with GAAP, together with the report thereon of
Malone & Bailey P.C., independent certified public accountants, (b) the
unaudited balance sheets of the Company as at September 30, 2007 (the “Balance
Sheet”) and September 30, 2006, and the related unaudited statements of
operations and changes in cash flow for the nine-month periods then ended
(including the notes thereto), all of which were prepared in accordance with
GAAP, and (c) an unaudited consolidated balance sheet of the Company as at
November 30, 2007 (the “Interim Balance
Sheet”) and the related unaudited consolidated statements of operations
and cash flow for the eleven months then ended, which were prepared in
accordance with GAAP. Such financial statements and notes fairly present in all
material respects the financial condition and the results of operations, changes
in stockholders' equity, and cash flow of the Company as at the respective dates
of and for the periods referred to in such financial statements, subject, in the
case of interim financial statements, to normal recurring year-end adjustments
(the effect of which will not, individually or in the aggregate, be materially
adverse) and the absence of notes. The financial statements referred to in this
Section 3.4
reflect the consistent application of such accounting principles throughout the
periods involved, except as disclosed in the notes to such financial statements.
No financial statements of any Person other than the Company are required by
GAAP to be included in the consolidated financial statements of the
Company

     

                                   
(b)            Schedule 3.4(b) of
the Disclosure Schedule contains a complete and accurate list of all accounts
receivable of the Company as of the Closing Date (collectively, the “Accounts
Receivable”), which list sets forth the aging of such Accounts
Receivable. All Accounts Receivable represent valid and undisputed obligations
arising from sales actually made or services actually performed in the Ordinary
Course of Business. The Accounts Receivable will be collectible in the Ordinary
Course of Business within 60 days of the Closing Date.

     

    3.5 Books
and Records.  The books of account, minute books, stock record
books, and other records of the Company, all of which have been delivered or
made available to Buyer, (i) are complete and correct in all material respects,
and (ii) since July 31, 2007, have been maintained pursuant to an adequate
system of internal accounting controls. The minute books of the Company contain
materially accurate and complete records of all meetings held of, and corporate
action taken by, the shareholders and the Board of Directors of the Company, and
no meeting of any such shareholders or Board of Directors has been held for
which minutes have not been prepared and are not contained in such minute books.
At the Closing, all of those books and records will be in the possession of the
Company.

     

    3.6 Title
to Properties; Encumbrances.  Schedule 3.6 of the
Disclosure Schedule contains a complete and accurate list of all personal
property, real property, leaseholds, or other real property interests therein
owned by the Company. The Company has delivered or made available to Buyer
copies of the deeds and other instruments (as recorded) by which the Company
acquired such real property and interests, and copies of all title insurance
policies, opinions, abstracts, and surveys in the possession of Seller or the
Company and relating to such 

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    property
or interests.  The Company owns, leases or has the right to use (with
good and marketable title in the case of real property) all of the properties
and assets listed on Schedule 3.6,
located in the Facilities owned or operated by the Company or reflected as owned
in the books and records of the Company, including all of the properties and
assets reflected in the Balance Sheet and the Interim Balance Sheet (except for
personal property sold since the date of the Balance Sheet and the Interim
Balance Sheet, as the case may be, in the Ordinary Course of Business, and the
personal assets of employees and vendor-owned assets used to provide services to
or by the Company in the Ordinary Course of Business).  All
subsequently purchased or acquired properties and assets were acquired in the
Ordinary Course of Business.  All such personal properties and assets
of the Company are free and clear of all Encumbrances except for (a) assets held
under capital leases disclosed, or not required to be disclosed, in Schedule 3.6 of the
Disclosure Schedule, (b) mortgages or security interests disclosed on Schedule 3.6 as
securing specified liabilities or obligations, with respect to which no material
default (or event that, with notice or lapse of time or both, would constitute a
material default) exists, and (c) liens for current taxes not yet due. All real
properties reflected in the Balance Sheet and the Interim Balance Sheet are free
and clear of all Encumbrances except for (i) minor imperfections of title, if
any, none of which is substantial in amount, materially detracts from the value
or impairs the use of the property subject thereto, or impairs the operations of
the Company, and (ii) zoning laws and other land use restrictions that do not
materially impair the present use of the property subject thereto. All
buildings, plants, and structures owned by the Company lie wholly within the
boundaries of the real property owned by the Company and do not encroach upon
the property of, or otherwise conflict with the property rights of, any other
Person. Seller has no actual or beneficial ownership interest in any of the
foregoing real property.

     

    3.7 Cash;
Net Working Capital; No Undisclosed Liabilities.  As of the
Closing Date, (i) the Company’s Net Working Capital is zero, and (ii) all cash
and all current liabilities in excess of current assets (excluding cash) and all
other liabilities of any kind or nature of the Company have been satisfied by
the Company. The Company has no liabilities or obligations required to be
disclosed in a balance sheet or related footnotes prepared in accordance with
GAAP, except for current liabilities equal to current assets (excluding cash)
reflected in the Interim Balance Sheet.  The Company is not a
guarantor or otherwise contingently liable on any indebtedness of any other
Person.

     

    3.8 Compliance with Legal
Requirements; Governmental Authorizations.

     

    (a)           (i)           The
Company is, and at all times since January 1, 2003 has been, in full compliance
with each material Legal Requirement that is or was applicable to the Company or
to the conduct or operation of its business or the ownership or use of any of
its assets; (ii) no event has occurred since January 1, 2003, or circumstance
exists that (with or without notice  or lapse of time) (A) would
reasonably be expected to constitute or result in a violation by the Company of,
or a failure on the part of the Company to comply with, any material Legal
Requirement, or (B) would reasonably be expected to give rise to any obligation
on the part of the Company to undertake, or to bear a material portion of the
cost of, any remedial action of any nature; and (iii) the Company has not
received, at any time since January 1, 2003, any written notice or other written
communication from any Governmental Body or any other Person regarding (A) any
actual or potential violation of, or failure to comply with, any 

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    material
Legal Requirement, or (B) any actual or potential obligation on the part of the
Company to undertake, or to bear a material portion of the cost of, any remedial
action of any nature.

    

    (b)           Schedule 3.8(b) of
the Disclosure Schedule contains a complete and accurate list of each
Governmental Authorization that is held by the Company and that is material to
the operation of the business of the Company as currently conducted. Each
Governmental Authorization listed or required to be listed in Schedule 3.8(b) of
the Disclosure Schedule is valid and in full force and effect.  Except
as set forth in Schedule 3.8(b) of
the Disclosure Schedule: (i) the Company is, and at all times since January 1,
2003, has been, in material compliance with all of the terms and requirements of
each Governmental Authorization identified or required to be identified in Schedule 3.8(b) of
the Disclosure Schedule; (ii) no event has occurred or circumstance exists that
would reasonably be expected to (with or without notice or lapse of time) (A)
constitute or result directly or indirectly in a violation of or a failure to
comply with any material term or requirement of any Governmental Authorization
listed or required to be listed in Schedule 3.8(b) of
the Disclosure Schedule, or (B) result directly or indirectly in the revocation,
withdrawal, suspension, cancellation, or termination of, or any modification to,
any Governmental Authorization listed or required to be listed in Schedule 3.8(b)
of the Disclosure Schedule; (iii) the Company has not received, at any time
since January 1, 2003, any written notice or other written communication from
any Governmental Body or any other Person regarding (A) any actual or potential
violation of or failure to comply with any term or requirement of any
Governmental Authorization, or (B) any actual or potential revocation,
withdrawal, suspension, cancellation, termination of, or modification to any
Governmental Authorization; and (iv) all applications required to have been
filed for the renewal of the Governmental Authorizations listed or required to
be listed in Schedule
3.8(b) of the Disclosure Schedule have been duly filed on a timely basis
with the appropriate Governmental Bodies.

     

    3.9 Legal Proceedings;
Orders.

     

    (a)           Schedule 3.9 of the
Disclosure Schedule sets forth a complete and accurate list of all Proceedings:
(i) that have been commenced by or against the Company; or (ii) to which the
Company is a party that challenges any of the Contemplated Transactions. No
other such Proceedings have been threatened by any third party.  The
Company has delivered or made available to Buyer copies of all pleadings,
correspondence, and other documents relating to each Proceeding listed in Schedule 3.9 of the
Disclosure Schedule. The Proceedings listed in Schedule 3.9 of
the Disclosure Schedule would not reasonably be expected to have a material
adverse effect on the business, operations, assets or condition of the
Company.

    

    (b)           
There is no Order to which any of the Company is subject; and no officer,
director, agent, or employee of the Company is subject to any Order that
prohibits such officer, director, agent, or employee from engaging in or
continuing any conduct, activity, or practice relating to the business of the
Company.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    3.10 Absence
of Certain Changes and Events.  For the period from the date of
the Balance Sheet to the date hereof, the Company has conducted its business
only in the Ordinary Course of Business and there has not been any:

     

    (a)           change
in the Company's authorized or issued capital stock; grant of any stock option
or right to purchase shares of capital stock of the Company; issuance of any
security convertible into such capital stock; grant of any registration rights;
purchase, redemption, retirement, or other acquisition by the Company of any
shares of any such capital stock; or declaration or payment of any dividend or
other distribution or payment in respect of shares of capital
stock;

    

    (b)           amendment
to the Organizational Documents of the Company;

    

    (c)           payment
or increase by the Company of any bonuses, salaries, or other compensation to
any shareholder, director, officer, or (except in the Ordinary Course of
Business) employee or any entry into any employment, severance, or similar
Contract with any director, officer, or employee;

    

    (d)           adoption
of, or increase in the payments to or benefits under, any profit sharing, bonus,
deferred compensation, savings, insurance, pension, retirement, or other
employee benefit plan for or with any employees of the Company;

    

    (e)           damage
to or destruction or loss of any asset or property of the Company, whether or
not covered by insurance, materially and adversely affecting the properties,
assets, business, financial condition, of the Company, taken as a
whole;

    

    (f)           entry
into, termination of, or receipt of notice of termination of (i) any material
license, distributorship, dealer, sales representative, joint venture, credit,
or similar agreement, or (ii) any Contract or transaction involving a total
remaining commitment by or to the Company of at least $25,000, other than
purchase orders given or received by the Company for the purchase or sale of
inventory in the Ordinary Course of Business;

    

    (g)           sale
(other than sales of inventory in the Ordinary Course of Business), lease, or
other disposition of any material asset or property of the Company or mortgage,
pledge, or imposition of any lien or other encumbrance on any material asset or
property of the Company, including the sale, lease, or other disposition of any
of the material intellectual property assets of the Company;

    

    (h)           cancellation
or waiver in writing of any claims or rights with a value to the Company in
excess of $25,000 except to the extent reserved for in the Balance Sheet or
Interim Balance Sheet, or that will be reserved for in the Closing Balance
Sheet;

    

    (i)           material
change in the accounting methods used by the Company; or

    

    (j)           written
agreement, by the Company to do any of the foregoing.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    3.11 Contracts; No
Defaults.

     

    (a)           Schedule 3.11(a) of
the Disclosure Schedule contains a complete and accurate list, and the Company
has delivered or made available to Buyer true and complete copies, of (each, a
“Material
Contract”):

    

    
      	
              (i)

            	
              each
      executory Seller Contract that involves the performance of services or the
      delivery of goods or materials by the Company of an outstanding amount or
      value in excess of $25,000 other than purchase orders given or received by
      the Company for the purchase or sale of inventory in the Ordinary Course
      of Business of an outstanding amount or value of less than $25,000;
      and

            

    

    

    
      	
              (ii)

            	
              each
      executory Seller Contract that involves the performance of services or the
      delivery of goods or materials to the Company of an outstanding amount or
      value in excess of $25,000 other than purchase orders given or received by
      the Company for the purchase or sale of inventory in the Ordinary Course
      of Business of an outstanding amount or value of less than
      $25,000.

            

    

    

    (b)           Each
Material Contract is in full force and effect and is valid and enforceable in
accordance with its terms and the Company is in full compliance with all
material terms and requirements of each Material Contract;

     

    3.12 Relationships
with Related Persons.  No Seller or any Related Person of
Seller or of the Company has, or since January 1, 2003, has had, any interest in
any property (whether real, personal, or mixed and whether tangible or
intangible), used in or pertaining to the Company’s business. No Seller or any
Related Person of Seller or of the Company is, or since January 1, 2003, has
owned (of record or as a beneficial owner) an equity interest or any other
financial or profit interest in, a Person that has (i) had business dealings or
a material financial interest in any transaction with the Company, or (ii)
engaged in competition with the Company with respect to any line of the products
or services of the Company in any market presently served by the Company except
for less than one percent of the outstanding capital stock of any such competing
business that is publicly traded on any recognized exchange. No Seller or any
Related Person of Seller or of the Company is a party to any Contract with, or
has any claim or right against, the Company.

     

    3.13 No
Material Adverse Change.  Since July 31, 2007, there has not
been any material adverse change in the business, operations, customer and
employee relations, properties, assets or financial condition of the Company and
no event has occurred or circumstance exists that would reasonably be expected
to result in such a material adverse change.

     

    3.14 Disclosure.  No
representation or warranty of Seller in this Agreement, the Disclosure Schedule
or any other certificate or document delivered by Seller pursuant to this
Agreement, and no statement in this Agreement, the Disclosure Schedule or any
other certificate or document delivered by Seller pursuant to this Agreement,
omits to state a material fact necessary to make the statements herein or
therein, in light of the circumstances in which they were made, not misleading.
There is no fact known to Seller that has specific application 

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    to Seller
or the Company and that materially adversely affects the assets, business,
prospects, financial condition, or results of operations of the Company that has
not been set forth in this Agreement or the Disclosure Schedule.

     

    3.15 Brokers
and Finders.  Neither Seller nor its Representatives have
incurred any obligation or liability, contingent or otherwise, for brokerage or
finders' fees or agents' commissions or other similar payment in connection with
this Agreement.

     

    Article
IV

    Representations and
Warranties of Buyer

    

    Buyer represents and warrants to Seller
as follows:

     

    4.1 Organization
and Good Standing.  Buyer is a corporation validly established,
currently existing, and in good standing under the laws of State of
Delaware.

     

    4.2 Authority;
No Conflict.

     

    (a) This
Agreement constitutes the legal, valid, and binding obligation of Buyer,
enforceable against Buyer in accordance with its terms.  Upon the
execution and delivery by Buyer of the Noncompetition Agreement, the Yard Lease
Agreement, the Escrow Agreement, the Payment Instruction Letter and all other
documents or agreements executed by Buyer in connection herewith, (collectively,
the “Buyer’s Closing
Documents”), the Buyer’s Closing Documents will constitute the legal,
valid, and binding obligations of Buyer, enforceable against Buyer in accordance
with their respective terms.  Buyer has the absolute and unrestricted
right, power, authority, and capacity to execute and deliver this Agreement and
the Buyer’s Closing Documents and to perform its obligations under this
Agreement and the Buyer’s Closing Documents.

    

    (b) Except as
set forth in Schedule
4.2, neither the execution and delivery of this Agreement by Buyer nor
the consummation or performance of any of the Contemplated Transactions by Buyer
will give any Person the right to prevent, delay, or otherwise interfere with
any of the Contemplated Transactions pursuant to: (i) any provision of Buyer's
Organizational Documents; (ii) any resolution adopted by the Board of Directors
or the shareholders of Buyer; (iii) any Legal Requirement or Order to which
Buyer may be subject; or (iv) any Contract to which Buyer is a party or by which
Buyer may be bound. Except as set forth in Schedule 4.2, Buyer
is not, nor will it be, required to obtain any Consent from any third-party
Person in connection with the execution and delivery of this Agreement or the
consummation or performance of any of the Contemplated
Transactions.

     

    4.3 Investment
Intent.  Buyer is acquiring the Purchased Shares for its own
account and not with a view to their distribution within the meaning of Section
2(11) of the Securities Act.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    4.4 Certain
Proceedings.  There is no pending Proceeding that has been
commenced against Buyer and that challenges, or may have the effect of
preventing, delaying, making illegal, or otherwise interfering with, any of the
Contemplated Transactions.

     

     

    4.5 Brokers
and Finders.  Neither Buyer, nor its officers and agents have
incurred any obligation or liability, contingent or otherwise, for brokerage or
finders' fees or agents' commissions or other similar payment in connection with
this Agreement.

     

    Article
V

    Conditions Precedent to
Buyer’s Obligations to Close

    

    Buyer's obligation to purchase the
Purchased Shares and to take the other actions required to be taken by Buyer at
the Closing is subject to the satisfaction, at or prior to the Closing, of each
of the following conditions (any of which may be waived by Buyer, in whole or in
part):

     

    5.1 Accuracy
of Representations.  Each of Seller’s representations and
warranties in this Agreement must have been accurate in all respects as of the
Closing Date.

     

    5.2 Seller’s
Performance.

     

    (a) All of
the covenants and obligations that Seller is required to perform or to comply
with pursuant to this Agreement at or prior to the Closing must have been duly
performed and complied with in all material respects.

    

    (b) Each
document required to be delivered by Seller pursuant to Section 2.4(a)
must have been delivered.

     

    5.3 Consents.  Each
of the Consents identified in Schedule 4.2, if any,
must have been obtained and must be in full force and effect.

     

    5.4 Additional
Documents.  Each of the following documents must have been
delivered to Buyer:

     

    (a) an
opinion of William L. Crawford dated the Closing Date, in the form
mutually acceptable to Buyer and Seller;

    

    (b) the
certificate of incorporation and all amendments thereto of the Company, duly
certified as of a date not more than 30 days prior to the Closing Date by the
Secretary of State of the State of Utah;

    

    (c) certificates
dated as of a date not more than 30 days prior to the Closing Date (i) as to the
good standing of the Company executed by the Secretary of State of the State of
Utah, and (ii) as to the qualification to do business in Arizona executed by the
Secretary of State of Arizona; and

    

    (d) such
other documents as Buyer may reasonably request 

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    for the
purpose of (i)  evidencing the accuracy of any of Seller’s
representations and warranties, (ii) evidencing the performance by Seller of, or
the compliance by Seller with, any covenant or obligation required to be
performed or complied with by Seller on or before the Closing Date, (iii)
evidencing the satisfaction of any condition referred to in this Article V, or (v)
otherwise facilitating the consummation or performance of any of the
Contemplated Transactions.

     

    5.5 Delivery
of W-8 or W-9. On or prior to the Closing Date, Seller shall have
delivered a fully-executed W-8 or W-9 IRS form, as applicable.

     

    5.6 Due
Diligence.  On or prior to the Closing Date, Buyer shall
completed the business, legal, financial, tax and accounting due diligence
review of the Company to its sole satisfaction.

     

    5.7 Cash
and Excess Liabilities. On or prior to the Closing Date, Seller shall
have (i)(A) removed all cash, and (B) satisfied all current liabilities in
excess of current assets (excluding cash) and all other liabilities of any kind
or nature of the Company, and (ii) removed the Charles Schwab account (account
number 1668-9563).

     

    Article
VI

    Conditions Precedent to
Seller’s Obligations to Close

    

    Seller’s obligation to sell the
Purchased Shares and to take the other actions required to be taken by Seller at
the Closing is subject to the satisfaction, at or prior to the Closing, of each
of the following conditions (any of which may be waived by Seller, in whole or
in part):

     

    6.1 Accuracy
of Representations.  Each of Buyer's representations and
warranties in this Agreement must have been accurate in all respects as of the
Closing Date.

     

    6.2 Buyer’s
Performance.

     

    (a) All of
the covenants and obligations that Buyer is required to perform or to comply
with pursuant to this Agreement at or prior to the Closing must have been
performed and complied with in all material respects.

    

    (b) Buyer
must have delivered each of the documents required to be delivered by Buyer
pursuant to Section
2.4(b) and must have made the payments required to be made by Buyer
pursuant to Section
2.4(b).

     

    6.3 Consents.  Each
of the Consents identified in Schedule 3.2 of the
Disclosure Schedule, if any, must have been obtained and must be in full force
and effect.

     

    6.4 Additional
Documents.  Buyer must have caused the following documents to
be delivered to Seller such other documents as Seller may reasonably request for
the purpose of (i) evidencing the accuracy of any representation or warranty of
Buyer, (ii) evidencing the performance by Buyer of, or the compliance by Buyer
with, any covenant or obligation required to be performed or complied with by
Buyer, (iii) evidencing the satisfaction of any condition 

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    referred
to in this Article
VI, or (v) otherwise facilitating the consummation of any of the
Contemplated Transactions.

     

    Article
VII

    Indemnification

     

    7.1 Survival.  All
representations, warranties, covenants, and obligations in this Agreement, the
Disclosure Schedule and any other certificate or document delivered pursuant to
this Agreement will survive the Closing.

     

    7.2 Indemnification
and Payment of Damages by Sellers.  After the Closing, Seller
will indemnify and hold harmless Buyer, the Company, and their respective
Representatives, stockholders, controlling persons, and affiliates
(collectively, the “Indemnified
Persons”) from and against, and will pay to the Indemnified Persons the
amount of any loss, liability, claim, damage, expense (including reasonable
costs of investigation and defense and reasonable attorneys' fees) or diminution
of value, whether or not involving a third-party claim (collectively, “Damages”),
arising, directly or indirectly, from or in connection with:

     

    (a)           any
Breach of any representation or warranty made by Seller in this Agreement, the
Disclosure Schedule or any other certificate or document delivered by Seller
pursuant to this Agreement, including any amounts by which the Accounts
Receivable as reflected on Schedule 3.4(b) are
not collectible in the Ordinary Course of Business within 60 days of the Closing
Date, provided such uncollected Accounts Receivable are transferred to
Seller;

    

    (b)           any
Breach by Seller of any covenant or obligation of Seller in this
Agreement;

    

    (c)           any
product shipped or manufactured by, or any services provided by, the Company
prior to the Closing Date; and

    

    (d)           any
claim by any Person for brokerage or finder's fees or commissions or similar
payments based upon any agreement or understanding alleged to have been made by
any such Person with the Seller or the Company (or any Person acting on their
behalf) in connection with any of the Contemplated Transactions.

    

    Seller
shall have no liability for indemnification with respect to claims under Section 7.2(a)
until the total of all Damages with respect to such matters exceeds $25,000 at
which time Seller shall be liable for indemnification for all Damages with
respect to such claims (including the first $25,000 of such Damages). However,
the immediately preceding sentence shall not apply to claims (i) under Section 7.2(a) with
respect to matters arising in respect of Sections 3.2(a),
3.3, 3.12 and 3.15, or (ii) for all
cash out-of-pocket Damages relating to any amounts by which the Accounts
Receivable as reflected on Schedule 3.4(b) are
not collectible in the Ordinary Course of Business within 60 days of the Closing
Date to the extent such uncollected Accounts Receivable are transferred to
Seller. Seller’s total liability for Damages pursuant to this Article VII shall not
exceed $3,562,500 except for (i) Damages relating to claims arising out of or
related to Seller’s representations regarding capitalization of the Company as
set forth in Section

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    3.3(a) and ownership
by Seller of the Purchased Shares free and clear of any Encumbrances as set
forth in Section 3.3(b),
or (ii) Damages from any intentional breach by Seller of any of Seller’s
representations, warranties, covenants or obligations, and Seller will be liable
for all Damages with respect to any such breaches.

     

    7.3 Procedure
for Indemnification – Third Party Claims.

     

    (a)           Promptly
after receipt by an Indemnified Person of notice of the commencement of any
Proceeding against such Indemnified Person, such Indemnified Person will, if a
claim is to be made against Seller under Section 7.2, give
notice, setting forth the factual basis for such claim in reasonable detail to
the extent known, to the Seller of the commencement of such claim, but the
failure to notify Seller will not relieve Seller of any liability that Seller
may have to any Indemnified Person, except to the extent that Seller is
prejudiced by the Indemnified Person's failure to give such notice.

    

    (b)           If
any Proceeding referred to in Section 7.3(a) is
brought against an Indemnified Person and such Indemnified Person gives notice
to Seller of the commencement of such Proceeding, Seller will be entitled to
participate in such Proceeding and, to the extent that Seller wishes (unless (i)
Seller is also a party to such Proceeding and the Indemnified Person determines
in good faith that joint representation would be inappropriate, or (ii) Seller
fails to provide reasonable assurance to the Indemnified Person of Seller’s
financial capacity to defend such Proceeding and provide indemnification with
respect to such Proceeding), to assume the defense of such Proceeding with
counsel reasonably satisfactory to such Indemnified Person and, after notice
from Seller to the Indemnified Person of Seller’s election to assume the defense
of such Proceeding, Seller will not, as long as Seller diligently conducts such
defense, be liable to the Indemnified Person under this Article VII for
any fees of other counsel or any other expenses with respect to the defense of
such Proceeding, in each case subsequently incurred by the Indemnified Person in
connection with the defense of such Proceeding. If Seller assumes the defense of
a Proceeding, (i) no compromise or settlement of such claims may be effected by
Seller without the Indemnified Person's consent (not to be unreasonably
withheld, delayed or conditioned) unless (A) there is no finding or admission of
any violation of Legal Requirements, and (B) there is no liability or
restriction on the Indemnified Person; and (ii) the Indemnified Person will have
no liability with respect to any compromise or settlement of such claims
effected without such Indemnified Person’s consent.  If notice is
given to Seller of the commencement of any Proceeding and Seller does not,
within 20 days after the Indemnified Person's notice is given, give notice to
the Indemnified Person of Seller’s election to assume the defense of such
Proceeding, the Indemnified Person shall diligently conduct the defense and
Seller will be bound by any determination made in such Proceeding or any
compromise or settlement effected by the Indemnified Person.

     

    7.4 Procedure
for Indemnification – Other Claims.  A claim for
indemnification for any matter not involving a third-party claim shall be
promptly asserted by notice to Seller.

     

    7.5 Payments
From Indemnification Escrow Amount and Seller.  In the event
that any Indemnified Person is entitled to indemnification from Seller pursuant
to this Article
VII, the amount of Damages for which such Indemnified Person is entitled
to indemnification shall be paid from the Indemnification Escrow Amount to the
extent there are sufficient funds

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    available
in the Indemnification Escrow Amount and Buyer and Seller shall issue joint
written instructions to the Escrow Agent authorizing distribution of the amount
of such Damages to such Indemnified Person within three Business Days of a final
determination of the amount of such Damages by (i) Buyer and Seller, or (ii)
pursuant to a final and binding determination of a court of competent
jurisdiction. To the extent that Seller is liable for any Damages in excess of
the Indemnification Escrow Amount, Seller shall pay such amount to Buyer for the
benefit of the applicable Indemnified Person, by wire transfer to a bank account
specified by Buyer, within such three Business Day period.

     

    7.6 Release
of Indemnification Escrow Amount.

     

    (a)           On
the six month anniversary of the Closing Date, the Escrow Agent shall release to
Seller the remaining portion of the Indemnification Escrow Amount less an amount
equal to the aggregate of all claims for indemnification of the Indemnified
Persons which have been properly asserted prior to such date and remain pending
and unresolved on such date.

     

    (b)           After
the six month anniversary of the Closing Date, in the event and to the extent
that the remaining portion of the Indemnification Escrow Amount exceeds the
aggregate amount of all claims for indemnification that remain pending and
unresolved, the Escrow Agent shall release to Seller any such excess amount. To
the extent any such pending and unresolved claims are subsequently resolved in
favor of an Indemnified Person, then such Indemnified Person shall be entitled
to indemnification from Seller in the amount of any related Damages as provided
in Section
7.5.

     

    (c)           Seller
and Buyer shall deliver within three Business Days joint written instructions to
the Escrow Agent required pursuant to the terms of the Escrow Agreement in order
to make the distributions required by this Section
7.6.

    

    Article
VIII

    General
Provisions

     

    8.1 Expenses.  Except
as otherwise expressly provided in this Agreement, each party to this Agreement
will bear its respective expenses incurred in connection with the preparation,
execution, and performance of this Agreement and the Contemplated Transactions,
including all fees and expenses of its Representatives. Any expenses incurred by
the Company in connection with the Contemplated Transactions shall be reimbursed
to the Company by Seller.

     

    8.2 Public
Announcements.  Any public announcement or similar publicity
with respect to this Agreement or the Contemplated Transactions will be issued,
if at all, at such time and in such manner as Buyer and Seller mutually
agree.

     

    8.3 Confidentiality.  Buyer
and Seller will maintain in confidence, and will cause their respective
Representatives to maintain in confidence, this Agreement, any related agreement
and the Contemplated Transactions and not use to the detriment of another party
or the Company any written, oral, or other information obtained in confidence
from another party or the Company in connection with this Agreement or the
Contemplated Transactions, unless (a) 

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    such
information is already known to such party or to others not bound by a duty of
confidentiality or such information becomes publicly available through no fault
of such party, (b) the use of such information is necessary or appropriate in
making any filing or obtaining any Consent required for the consummation of the
Contemplated Transactions, or (c) the furnishing or use of such information is
required by legal proceedings.

     

    8.4 Notices.  All
notices, requests, demands and other communications given or made pursuant to
this Agreement shall be in writing and shall be deemed effectively
given:  (i) upon personal delivery to the party to be notified, (ii)
when sent by confirmed electronic mail or facsimile if sent during normal
business hours of the recipient, and if not so confirmed, then on the next
business day, (iii) five days after having been sent by registered or certified
mail, return receipt requested, postage prepaid, or (iv) one day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt, in each case to the following addresses,
facsimile numbers or e-mail addresses and marked to the attention of the person
(by name or title) designated below (or to such other address, facsimile number,
e-mail address or person as a party may designate by notice to the other
parties):

     

    

    Seller:                      Robert
L. Beeman

    418 Cottonwood Lane

    Moab Utah 84532

    Facsimile No.: (435)
259-0703

    Email: bbdc@citlink.com

    

    with a
copy (which shall not be considered notice) to:

     

    William L. Crawford, Esq.

    1996 East
6400 South, Ste. 100

    Salt Lake
City, Utah 84121

    Facsimile No.: (801)
424-4243

    Email: wcrawford@aol.com

    

    Buyer:                     Best
Energy Services, Inc.

    1010 Lamar

    Suite 1200

    Houston, Texas 77002

    Attention: Larry Hargrave, Chief
Executive Officer

    Facsimile No.: (713)
933-2602

    Email: lhargrave@bestenergyservicesinc.com

    

    with a
copy (which shall not be considered notice) to:

    Jackson Walker L.L.P.

    100 Congress Avenue

    Suite 1100

    Austin, Texas 78701

    Attention: Lawrence A. Waks,
Esq.

    Facsimile No.: (512)
236-2002

    Email: lwaks@jw.com

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    8.5 Further
Assurances.  The parties agree (a) to furnish upon request to
each other such further information, (b) to execute and deliver to each other
such other documents, and (c) to do such other acts and things, all as the other
party may reasonably request for the purpose of carrying out the intent of this
Agreement and the documents referred to in this Agreement.

     

    8.6 Waiver.  Neither
the failure nor any delay by any party in exercising any right, power, or
privilege under this Agreement or the documents referred to in this Agreement
will operate as a waiver of such right, power, or privilege, and no single or
partial exercise of any such right, power, or privilege will preclude any other
or further exercise of such right, power, or privilege or the exercise of any
other right, power, or privilege. To the maximum extent permitted by applicable
Law, (a) no claim or right arising out of this Agreement or the documents
referred to in this Agreement can be discharged by one party, in whole or in
part, by a waiver or renunciation of the claim or right unless in writing signed
by Buyer, with respect to a waiver on behalf of Buyer, and by Seller, with
respect to a waiver on behalf of Seller; (b) no waiver that may be given by a
party will be applicable except in the specific instance for which it is given;
and (c) no notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.

     

    8.7 Entire
Agreement; Modification; Termination.  This Agreement
supersedes all prior agreements between the parties with respect to its subject
matter (including the preliminary letter of intent, dated April 9, 2007 among
Buyer, the Company and certain other parties thereto) and constitutes (along
with the documents referred to in this Agreement) a complete and exclusive
statement of the terms of the agreement between the parties with respect to its
subject matter. This Agreement may not be amended except by a written agreement
executed by the party to be charged with the amendment. This Agreement may be
terminated by mutual consent of Buyer and Seller.

     

    8.8 Assignments,
Successors, and No Third Party Rights.  Neither party may
assign any of its rights under this Agreement without the prior consent of the
other parties except that Buyer may assign any of its rights under this
Agreement to any Subsidiary or other Related Person of Buyer. Subject to the
preceding sentence, this Agreement will apply to, be binding in all respects
upon, and inure to the benefit of the successors and permitted assigns of the
parties.  Nothing expressed or referred to in this Agreement will be
construed to give any Person other than the parties to this Agreement any legal
or equitable right, remedy, or claim under or with respect to this Agreement or
any provision of this Agreement.  This Agreement and all of its
provisions and conditions are for the sole and exclusive benefit of the parties
to this Agreement and their successors and assigns.

     

    8.9 Severability.  If
any provision of this Agreement is held invalid or unenforceable by any court of
competent jurisdiction, the other provisions of this Agreement will remain in
full force and effect.  Any provision of this Agreement held invalid
or unenforceable only in part or degree will remain in full force and effect to
the extent not held invalid or unenforceable.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    8.10 Time
of Essence.  With regard to all dates and time periods set
forth or referred to in this Agreement, time is of the essence.

     

    8.11 Governing
Law.  This Agreement (including any claim or controversy
arising out of or relating to this Agreement) shall be governed by the laws of
the State of Texas, without regard to conflict of law principles that would
result in the application of any law other than the law of the State of
Texas.

     

    8.12 Dispute
Resolution.  Except as provided below, in the event of any
dispute, claim or disagreement arising out of or relating to this Agreement or
any Contemplated Transaction, including the negotiation, execution,
interpretation, performance or non-performance of this Agreement, the parties
shall first submit the dispute, claim or disagreement to non-binding mediation
administered by the American Arbitration Association (the “AAA”) in
accordance with its Commercial Mediation Procedures.  The place of
mediation shall be Dallas, Texas.  If the dispute, claim or
disagreement is not resolved within 30 days after the initial mediation meeting
among the parties and the mediator, or if the mediation is otherwise terminated,
then either party may submit the dispute, claim or disagreement to binding
arbitration administered by the AAA in accordance with the provisions of its
Commercial Arbitration Rules (the “Rules”)
and, except as provided below, such arbitration shall be the sole means of
dispute resolution.  The place of arbitration shall be Dallas,
Texas.  The arbitration shall be conducted by a panel of three
arbitrators selected in accordance with the Rules, unless the parties otherwise
agree to one arbitrator.  Any mediator or arbitrator selected under
this Section
8.12 shall be a practicing attorney experienced in commercial agreements
and acquisitions and shall not have been employed or engaged by or affiliated
with either of the parties or their respective affiliates.  Each party
shall initially bear its own costs and expenses in connection with any mediation
or arbitration hereunder, including, without limitation, its attorneys’ fees,
and an equal share of the mediator’s or arbitrator’s and administrative fees of
mediation or arbitration.  The decision of the arbitrators shall be in
writing.  Judgment upon an arbitration award may be entered in any
court of competent jurisdiction and shall be final, binding and
non-appealable.  Notwithstanding anything in this Section 8.12 to the
contrary, each party shall be entitled to seek injunctive or other equitable
relief without first submitting the matter to mediation or arbitration in
accordance with the provisions of this Section 8.12, even if
a similar or related matter has already been referred to meditation or
arbitration in accordance with the terms of this Section
8.12.  Venue for any action permitted to be brought in court
under this Section
8.12 shall be the appropriate state and federal courts located in Dallas
County, Texas.

     

    8.13 Counterparts;
Facsimile Execution. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
shall be one and the same document. The exchange of copies of this Agreement and
of signature pages by facsimile transmission, PDF or other electronic file shall
constitute effective execution and delivery of this Agreement as to the parties
and may be used in lieu of the original Agreement for all purposes. Signatures
of the parties transmitted by facsimile, PDF or other electronic file shall be
deemed to be their original signatures for all purposes.

     

    8.14 True-Up
Period. During the period from Closing to
April 14, 2008 (the "True-Up
Period"), any payments for Accounts Receivable actually received by the
Company in excess of the Minimum Accounts Receivable Amount ("Post-Closing
Accounts Receivable Receipts") shall be held by the Company for the
benefit of Seller. During the True-Up Period, any payments made by the Company
with respect to any liabilities required to be paid or otherwise satisfied by
Seller pursuant to this Agreement ("Post-Closing
Liability Payments"), shall be for the account of Seller. No later than
April 24, 2008, (i) the Copmany shall pay to Seller the amount by which
Post-Closing Accounts Receivable Receipts exceed Post-Closing Liability
Payments, or (ii) Seller shall pay to the Company the amount by which
Post-Closing Liability Payments exceed Post-Closing Accounts Receivable
Receipts. This Section 8.14 shall have no effect on the representation and
warranty of Seller set forth in Section 3.7 nor Seller's obligations under
Section 5.7 or any resulting indemnification obligations of Seller pursuant to
Section 7.2 as a result of any inaccuracy of breach thereof, but is intended to
provide an administrative mechanism to account for the receipt by the Company
during the True-Up Period of any Accounts Receivables that are the property of
Seller and the payment by Seller during the True-Up Period of any accounts
payable that are the obligation of Seller. 

     

    [Signature Page to
Follow]

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    

    In Witness Whereof, the parties have
executed and delivered this Agreement as of the date first written
above.

    
    

     

    
      	Buyer:
	Best Energy
      Services, Inc.
	 
	/s/ Larry
    Hargrave 
	Larry Hargrave,
      Chief Executive Officer
	 
	
              Seller:

            
	Robert L.
      Beeman
	 
	/s/ Robert L.
    Beeman 
	Robert L. Beeman,
      individuallyex10_3.htm

    Escrow
Agreement

    

    This
Escrow Agreement (the “Agreement”), dated as of February 14,
2008 (the “Closing
Date”), by and among (i) Best Energy Services, Inc., a Nevada corporation
(“Buyer”),
(ii) Tony Bruce, a resident of Liberal, Kansas (“Seller”),
and (iii) JPMorgan Chase Bank, N.A., a national banking
association, as escrow agent (“Escrow
Agent”).

    

    This is
the Escrow Agreement referred to in that certain Stock Purchase Agreement dated
February 14, 2008 (the “Purchase
Agreement”), by and among Buyer and Seller. Capitalized terms used in
this Agreement without definition shall have the respective meanings given to
them in the Purchase Agreement.

    

    In
consideration of the premises and the mutual obligations and covenants set forth
herein, and other good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, the parties, intending to be legally bound,
hereby agree as follows:

    

    1.           Establishment
of Escrow.

     

    (a) Buyer is
depositing with Escrow Agent $500,000 (the “Escrow
Amount”), representing the Indemnification Escrow Amount (as increased by
any earnings thereon and as reduced by any disbursements, amounts withdrawn
hereunder, or losses on investments, the “Escrow
Fund”), in immediately available funds. Upon receipt, the Escrow Agent
shall acknowledge receipt thereof.

    

    (b) Buyer and
Seller hereby appoint the Escrow Agent as their escrow agent for the purposes
set forth herein, and the Escrow Agent hereby accepts such appointment under the
terms and conditions set forth herein.

    

    2.           Investment
of Funds.  During the term of this Agreement, the Escrow Fund
shall be invested and reinvested by the Escrow Agent in the investments
indicated on Schedule
1.  The Escrow Agent shall have the right to liquidate any
investments held in order to provide funds necessary to make required payments
under this Agreement.  The Escrow Agent shall have no liability for
any loss sustained as a result of any investment in an investment indicated on
Schedule 1 or
any investment made pursuant to the joint written instructions of Buyer and
Seller (“Joint Written
Instructions”) or as a result of any liquidation of any investment prior
to its maturity or for the failure of Buyer and Seller to give the Escrow Agent
Joint Written Instructions to invest or reinvest the Escrow Fund.

    

    3.           Disbursements
from Escrow Fund.

     

    (a) Claims
for indemnification or disbursement from the Escrow Fund by any Indemnified
Person or Seller under the Purchase Agreement shall be made against the then
remaining amount of the Escrow Fund only in accordance with the Purchase
Agreement and this Agreement. In the event that from time to time (i) any
Indemnified Person is entitled to indemnification from the Escrow Fund pursuant
to the Purchase Agreement, or (ii) Seller is entitled to a disbursement of all
or a portion of the Escrow Fund pursuant to the Purchase 

     

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

       

      Agreement,
Buyer and Seller shall execute and deliver to the Escrow Agent Joint Written
Instructions setting forth (A) the amount of such indemnification payment or
distribution (to the extent of the balance of the Escrow Fund remaining
therefor), together with (B) a calculation of the cumulative Net Escrow Income
(as defined in Section
7) earned on such amount, (C) the Income Tax Amount (as defined in Section 7) with
respect thereto, and (D) the recipients thereof. In the event that any
Indemnified Person or Seller is entitled to a payment pursuant to the preceding
sentence, each such recipient also shall be entitled to a disbursement of the
portion of the Net Escrow Income earned on the amount of such payment being made
to such Indemnified Person or Seller, minus the Income Tax Amount with respect
to such Net Escrow Income, which shall be paid to Buyer in accordance with Section 7.
Notwithstanding such Joint Written Instructions, the Escrow Agent shall report
and, as required, withhold from any payments or disbursements made pursuant to
this Agreement from the Escrow Fund, any taxes as it determines may be required
by any law or regulation then in force. The
Escrow Agent shall have no obligation to investigate, inquire, examine or assist
in any manner whatsoever, the compliance by Buyer or Seller with the terms of
this Agreement that incorporate by reference provisions of the Purchase
Agreement that apply to the other parties' obligations or limitations of
liability to each other that do not relate to obligations of the Escrow Agent
under this Agreement.

    

    

    (b) Upon
receipt of any Joint Written Instructions, the Escrow Agent shall, as soon as
practicable and in no event later than three Business Days (as defined in
Section 8) after the receipt thereof, disburse the amounts from the Escrow Fund
to the Indemnified Person and/or Seller specified in such Joint Written
Instructions to be so paid (to the extent of the then-remaining balance of the
Escrow Fund), by wire transfer of immediately available funds pursuant to
payment instructions (i) furnished by Buyer with respect to any payment
specified in such Joint Written Instructions to be made to any Indemnified
Person and any Income Tax Amount, or (ii) furnished by Seller with respect to
any payments specified in such Joint Written Instructions to be made to
Seller.

    

    4.           Termination
of Escrow.  This Agreement shall terminate, and the then
remaining funds in the Escrow Fund shall be paid out, pursuant to Joint Written
Instructions of Buyer and Seller , subject to Sections 5(b) and
5(j)
hereof.

     

    5.           Duties
of Escrow Agent.

    

    (a) Escrow
Agent shall not be under any duty to give the Escrow Fund held by it hereunder
any greater degree of care than it gives its own similar property and shall not
be required to invest any funds held hereunder except as directed in this
Agreement.

    

    (b) Escrow
Agent shall not be liable for actions or omissions hereunder, except for its own
gross negligence or willful misconduct and, except with respect to claims based
upon such gross negligence or willful misconduct that are successfully asserted
against Escrow Agent.  Buyer and Seller shall jointly and severally
indemnify and hold harmless Escrow Agent (and any successor Escrow Agent) and
its affiliates and their respective assigns, directors, officers, managers,
attorneys, accountants, experts agents and employees (the “indemnities”)
from and against any and all losses, liabilities, claims, actions, damages,
penalties, judgments, settlements, actions, suits, proceedings, litigation,
investigations, cost and expenses, including reasonable attorneys’ fees and
disbursements, and experts and their staffs and all expense of document

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

      location,
duplication and shipment (collectively “Losses”)
arising out of and in connection with (a) the Escrow Agent's execution and
performance of this Agreement, tax reporting or withholding, the enforcement of
any rights or remedies under or in connection with this Agreement, or as may
arise by reason of any act, omission or error of the indemnitee, except in the
case of any indemnitee to the extent that such Losses are finally adjudicated by
a court of competent jurisdiction to have been primarily caused by the gross
negligence or willful misconduct of such indemnitee, or (b) its following any
instructions or other directions, whether joint or singular, from the Buyer and
Seller, except to the extent that its following any such instruction or
direction is expressly forbidden by the terms hereof. Without limiting the
foregoing, Escrow Agent shall in no event be liable in connection with its
investment or reinvestment of any cash held by it hereunder in good faith, in
accordance with the terms hereof, including, without limitation, any liability
for any delays (not resulting from its gross negligence or willful misconduct)
in the investment or reinvestment of the Escrow Fund or any loss of interest
incident to any such delays.  Anything in this Agreement to the
contrary notwithstanding, in no event shall the Escrow Agent be liable for
special, incidental, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Escrow Agent
has been advised of the likelihood of such loss or damage and regardless of the
form of action. The Buyer and Seller hereto acknowledge that the foregoing
indemnities shall survive the resignation, replacement or removal of the Escrow
Agent or the termination of this Agreement.  The Buyer and Seller
hereby grant the Escrow Agent a lien on, right of set-off against and security
interest in, the Escrow Fund for the payment of any claim for indemnification,
expenses and amounts due hereunder. The obligations contained in this Section 5(b) shall
survive the termination of this Agreement and the resignation, replacement or
removal of the Escrow Agent.

    

    

    (c) Escrow
Agent shall be entitled to rely upon any order, judgment, certification, demand,
notice, instrument or other writing delivered to it hereunder without being
required to determine the authenticity or the correctness of any fact stated
therein or the propriety or validity of the service thereof. Escrow Agent may
act in reliance upon any instrument or signature believed by it to be genuine
and may assume that the person purporting to give receipt or advice or make any
statement or execute any document in connection with the provisions hereof has
been duly authorized to do so. Escrow Agent may conclusively presume that the
undersigned representatives of Buyer and Seller have full power and authority to
instruct Escrow Agent on behalf of that party unless written notice to the
contrary is delivered to Escrow Agent. The Escrow Agent shall neither be
responsible for, nor chargeable with, knowledge of, nor have any requirements to
comply with, the terms and conditions of any other agreement, instrument or
document between the Buyer and Seller, in connection herewith, if any, including
without limitation the Purchase Agreement, nor shall the Escrow Agent
be required to determine if any person or entity has complied with any
such  agreements, nor shall any additional obligations of the Escrow
Agent be inferred from the terms of such agreements, even though reference
thereto may be made in this Agreement.  In the event of any conflict
between the terms and provisions of this Agreement, those of the Purchase Agreement, any schedule or exhibit attached to the
Agreement, or any other agreement among the Buyer and Seller, the terms
and conditions of this Agreement shall control.

    

    (d) Escrow
Agent may act pursuant to the advice of its counsel with respect to any matter
relating to this Agreement and shall not be liable for any action taken or
omitted by it in good faith in accordance with such advice.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    (e) Escrow
Agent does not have any interest in the Escrow Fund deposited hereunder, but is
serving as escrow holder only and has only possession thereof. Any payments of
income from the Escrow Fund shall be subject to withholding regulations then in
force with respect to United States taxes. Buyer and Seller will provide Escrow
Agent with appropriate Internal Revenue Service Forms W-8 and W-9 for tax
identification number certification, or nonresident alien certifications. This
Section 5(e)
and Section
5(b) shall survive notwithstanding any termination of this Agreement or
the resignation or removal of the Escrow Agent.

    

    (f) Escrow
Agent makes no representation as to the validity, value, genuineness or
collectability of any security or other document or instrument held by or
delivered to it.

    

    (g) Escrow
Agent shall not be called upon to advise any party as to the wisdom in selling
or retaining or taking or refraining from any action with respect to any
securities or other property deposited hereunder.

    

    (h) Escrow
Agent (and any successor Escrow Agent) may at any time resign as such by
delivering the Escrow Fund to any successor Escrow Agent jointly designated in
writing by Buyer and Seller, or to any court of competent jurisdiction,
whereupon Escrow Agent shall be discharged of and from any and all further
obligations arising in connection with this Agreement. The resignation of Escrow
Agent will take effect on the earlier of (i) the appointment of a successor
(including a court of competent jurisdiction) or (ii) the day which is 30 days
after the date of delivery of its written notice of resignation to Buyer and
Seller. If, at that time, Escrow Agent has not received a designation of a
successor Escrow Agent, Escrow Agent’s sole responsibility after that time shall
be to retain and safeguard the Escrow Fund until receipt of (x) a designation of
successor Escrow Agent or Joint Written Instructions, or (y) a final,
non-appealable order of a court of competent jurisdiction.

    

    Any
entity into which the Escrow Agent may be merged or converted or with which it
may be consolidated, or any entity to which all or substantially all the escrow
business may be transferred, shall be the Escrow Agent under this Agreement
without further act.

    

    (i) In the
event of any disagreement between the other parties hereto resulting in adverse
claims or demands being made in connection with the Escrow Fund or in the event
that Escrow Agent is in doubt as to what action it should take hereunder, Escrow
Agent shall be entitled to retain the Escrow Fund until Escrow Agent shall have
received (i) a final, non-appealable order of a court of competent jurisdiction
directing delivery of the Escrow Fund, or (ii) Joint Written Instructions
directing delivery of the Escrow Fund, in which event Escrow Agent shall
disburse the Escrow Fund in accordance with such order or Joint Written
Instructions. Any court order shall be accompanied by a legal opinion by counsel
for the presenting party satisfactory to Escrow Agent to the effect that the
order is final and non-appealable. Escrow Agent shall act on such court order
and legal opinion without further question. The Buyer and Seller agree to
pursue any redress or recourse in connection with any dispute without making the
Escrow Agent a party to the same.

    

    (j) Buyer and
Seller shall jointly and severally pay Escrow Agent compensation (as payment in
full) for the services to be rendered by Escrow Agent hereunder in the amount of

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

      Two
Thousand Five Hundred Dollars ($2,500) annually, as shown Schedule 3 hereto, and
agree to reimburse Escrow Agent for all reasonable and documented expenses,
disbursements and advances incurred or made by Escrow Agent in performance of
its duties hereunder (including reasonable fees, expenses and disbursements of
its counsel).  Any such compensation and reimbursement to which Escrow
Agent is entitled shall be borne 50% by Buyer and 50% by Seller. All invoices
for any such compensation or reimbursement shall be sent to Buyer and to
Seller. The Buyer and Seller hereby grant the Escrow Agent a lien on, right
of set-off against and security interest in, the Escrow Fund for the payment of
any claim for compensation, expenses and amounts due hereunder.  The
obligations contained in this Section 5(j) shall survive the termination of this
Agreement and the resignation, replacement or removal of the Escrow
Agent.

    

    

    (k) No
printed or other matter in any language (including, without limitation,
prospectuses, notices, reports and promotional material) that mentions Escrow
Agent’s name or the rights, powers or duties of Escrow Agent shall be issued by
or on behalf of Buyer or Seller unless Escrow Agent shall first have given its
specific written consent thereto.

    

    (l) The other
parties hereto authorize Escrow Agent, for any securities held hereunder, to use
the services of any United States central securities depository it reasonably
deems appropriate, including, without limitation, the Depository Trust Company
and the Federal Reserve Book Entry System.

    

    (m) In the
event funds transfer instructions are given (other than in writing at the time
of execution of this Agreement), whether in writing, by telecopier or otherwise,
the Escrow Agent is authorized to seek confirmation of such instructions by
telephone call-back to the person or persons designated on Schedule 2 hereto,
and the Escrow Agent may rely upon the confirmation of anyone purporting to be
the person or persons so designated. Each funds transfer instruction shall be
executed by an authorized signatory, a list of such authorized signatories is
set forth on Schedule
2. The undersigned representatives of Buyer and Seller are each
authorized to certify that the signatories for Buyer and Seller, respectively,
on Schedule 2 are authorized
signatories. The individuals authorized to give or confirm funds transfer
instructions may be changed only in a writing actually received and acknowledged
by the Escrow Agent. The Escrow Agent and the beneficiary’s bank in any funds
transfer may rely solely upon any account numbers or similar identifying numbers
provided by Buyer or Seller to identify (i) the beneficiary, (ii) the
beneficiary’s bank, or (iii) an intermediary bank. The Escrow Agent may apply
any of the Escrow Fund for any payment order it executes using any such
identifying number, even when its use may result in a person other than the
beneficiary being paid, or the transfer of funds to a bank other than the
beneficiary’s bank or an intermediary bank designated. The parties to this
Agreement acknowledge that these security procedures are commercially
reasonable. Buyer and Seller agree that repetitive or standing settlement
instructions will be effective as the funds transfer instructions of Buyer and
Seller, whether or not authorized, if such settlement instructions are verified
pursuant to the security procedure provided herein or such other security
procedure that the Escrow Agent, Buyer and Seller may agree to.

    

    (n) Section
326 of the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001 (“USA PATRIOT
Act”) requires the Escrow Agent to implement reasonable procedures to
verify the identity of any person that opens a new account with
it.  Accordingly, the Buyer and Seller acknowledge that 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

      Section
326 of the USA PATRIOT Act and the Escrow Agent’s identity verification
procedures require the Escrow Agent to obtain information which may be used to
confirm the Parties identity including without limitation name, address and
organizational documents (“identifying information”). The Buyer and Seller
agree to provide the Escrow Agent with and consent to the Escrow Agent obtaining
from third parties any such identifying information required as a condition of
opening an account with or using any service provided by the Escrow
Agent.

    

    

    6.           Limited
Responsibility.  This Agreement expressly sets forth all the
duties of Escrow Agent with respect to any and all matters pertinent hereto. No
implied duties or obligations shall be read into this Agreement against Escrow
Agent. Escrow Agent shall not be bound by the provisions of any agreement among
the other parties hereto except this Agreement.

    

    7.           Ownership
for Tax Purposes, Tax Distributions. The Escrow Agent shall account for
the Escrow Fund in a manner that separately records the interest and other net
income received or losses suffered in respect thereof (including amounts earned
thereon) through the end of each calendar month (collectively, the “Net Escrow
Income”), and shall send a monthly statement with the amount of Net
Escrow Income to Buyer and Seller within ten days after the end of each calendar
month and within ten days of any written request for such information from
either Buyer or Seller. Any discrepancies in any such account statement shall be
noted by Parties to Escrow Agent within thirty (30) calendar days after receipt
thereof.  Failure to inform Escrow Agent in writing of any
discrepancies in any such account statement within said thirty (30) day period
shall conclusively be deemed confirmation of such account statement in its
entirety. For income tax purposes, Buyer shall be treated as owning the Escrow
Fund for so long as it remains in the Escrow Account and shall take into account
all items of income, gain, deduction, loss and credit, shall report the amount
of such Net Escrow Income to the appropriate taxing authorities and shall pay or
caused to paid the income taxes that are due and payable on the Net Escrow
Income. No later than (i) the date of any payment from the Escrow Fund, and (ii)
30 days following the end of each calendar year quarter, the Escrow Agent shall
upon written instructions from Buyer pay to Buyer an amount equal to 40% of the
cumulative Net Escrow Income earned through such date less the amounts
previously distributed to Buyer pursuant to this Section 7 (any such
amount, an “Income Tax
Amount”).  Buyer and Seller acknowledge that all payments made
pursuant to this Agreement from the Escrow Fund shall be subject to applicable
withholding laws or regulations then in force.

    

    Buyer and
Seller further represent to the Escrow Agent that the transaction memorialized
in the Purchase Agreement does not constitute an installment sale requiring any
tax reporting or withholding of imputed interest or original issue discount to
the IRS or other taxing authority.

    

    Any tax
returns required to be filed will be prepared and filed by Buyer with the IRS
and any other taxing authority as required by law, including but not limited to
any applicable reporting or withholding pursuant to the Foreign Investment in
Real Property Tax Act (“FIRPTA”).  Buyer
and Seller acknowledge and agree that Escrow Agent shall have no responsibility
for the preparation and/or filing of any tax return or any applicable FIRPTA
reporting or withholding with respect to the Escrow Amount or any income earned
by the Escrow Amount.  Escrow Agent shall withhold any taxes it deems
appropriate, including but not limited to required withholding in the absence of
proper tax documentation, and shall remit such taxes to the appropriate
authorities.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    8.           Notices.  All
notices, Consents, waivers and other communications required or permitted under
this Agreement shall be in writing and shall be deemed given to a party when (a)
delivered to the appropriate address by hand or by a nationally recognized
overnight courier service (costs prepaid); (b) sent by facsimile(with
confirmation by the transmitting equipment); or (c) received by the addressee,
if sent by certified mail, return receipt requested, in each case to the
following addresses and facsimile numbers and marked to the attention of the
person (by name or title) designated below (or to such other address, facsimile
number or person as a party may designate by notice to the other
parties):

    

    
      	
               
      

            	
              If
      to Buyer, to:

            

    

    
      	
               
      

            	
              Best
      Energy Services, Inc.

            

    

    
      	
               
      

            	
              1010
      Lamar

            

    

    
      	
               
      

            	
              Suite
      1200

            

    

    
      	
               
      

            	
              Houston,
      Texas 77002

            

    

    
      	
               
      

            	
              Attention:
      Larry Hargrave, President

            

    

    
      	
               
      

            	
              Facsimile
      No.: (713) 933-2602

            

    

    
      	
               
      

            	
              Email:
      lhargrave@bestenergyservicesinc.com

            

    

    

    
      	
               
      

            	
              with
      a mandatory copy (which shall not constitute notice) to:

              Jackson
      Walker L.L.P.

              100
      Congress Avenue

              Suite
      1100

              Austin,
      Texas 78701

              Attention:
      Lawrence A. Waks, Esq.

              Facsimile
      No.: (512) 236-2002

            

    

     

    
      	
               
      

            	
              Email:
      lwaks@jw.com

            

    

    

    
      	
               
      

            	
              If
      to Seller, to:

            

    

    
      	
               
      

            	
              Tony
      Bruce

            

    

    
      	
               
      

            	
              2081
      Road C

            

    

    Liberal,
Kansas 67901

    Email:
bestwellserv@yahoo.com

    

    
      	
               
      

            	
              with
      a mandatory copy (which shall not constitute notice)
  to:

            

    

    Gilmore, Shellenberger & Maxwell,
P.A.

    500 North Kansas Avenue

    Liberal, Kansas 67901

    Attention: Grant Shellenberger,
Esq.

    Facsimile No.: (620)
624-5525

    Email: gshellenberger@swko.net

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    If to
Escrow Agent, to:

    JPMorgan
Chase Bank, N.A.

    Escrow
Services, TX2 S037

    712 Main
Street, 5th Floor
South

    Houston,
Texas  77002

    Attention:
Paul M . Gilliam

    Facsimile
No.: (713) 216-6927

    

    Notwithstanding
the above, in the case of communications delivered to the Escrow Agent pursuant
to (a), (b) and (c) of this Section 8, such
communications shall be deemed to have been given on the date received by an
officer of the Escrow Agent or any employee of the Escrow Agent who reports
directly to any such officer at the above-referenced office.  In the
event that the Escrow Agent, in its sole discretion, shall determine that an
emergency exists, the Escrow Agent may use such other means of communication as
the Escrow Agent deems appropriate.  “Business Day” shall mean any day other than a
Saturday, Sunday or any other day on which the Escrow Agent located at the
notice address set forth above is authorized or required by law or executive
order to remain closed.

    

    9.           Jurisdiction;
Service of Process.  Any Proceeding arising out of or relating
to this Agreement may be brought in the United States District Court located in
the State of New York, and each of the parties irrevocably submits to the
exclusive jurisdiction of each such court in any such Proceeding and waives any
objection it may now or hereafter have to venue or to convenience of forum,
agrees that all claims in respect of the Proceeding shall be heard and
determined only in any such court and agrees not to bring any Proceeding arising
out of or relating to this Agreement in any other court. Process in any
Proceeding referred to in the preceding sentence may be served on any party
anywhere in the world. The parties further hereby waive any right to a trial by
jury with respect to any lawsuit or judicial proceeding arising or relating to
this Agreement.

    

    10. Counterparts;
Facsimile Transmission. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement. The exchange of copies of this Agreement and of
signature pages by facsimile transmission, may be used in lieu of the original
Agreement for all purposes. Signatures of the parties transmitted by facsimile
shall be deemed to be their original signatures for any purposes
whatsoever.

    

    11.           Section
Headings; Construction. The headings of sections in this Agreement are
provided for convenience only and will not affect its construction or
interpretation.

    

    12.           Waiver.
The rights and remedies of the parties to this Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power or privilege under this Agreement or the documents referred to in
this Agreement will operate as a waiver of such right, power or privilege, and
no single or partial exercise of any such right, power or privilege will
preclude any other or further exercise of such right, power or privilege or the
exercise of any other right, power or privilege. To the maximum extent permitted
by applicable law, (a) no claim or right arising out of this Agreement or the
documents referred to in this Agreement can be discharged by one party, in whole
or in part, by a waiver or renunciation 

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

      of the
claim or right unless in writing signed by the other party; (b) no waiver that
may be given by a party will be applicable except in the specific instance for
which it is given; and (c) no notice to or demand on one party will be deemed to
be a waiver of any obligation of such party or of the right of the party giving
such notice or demand to take further action without notice or demand as
provided in this Agreement or the documents referred to in this
Agreement.

    

    

    13.           Entire
Agreement and Modification.  This Agreement supersedes all
prior agreements among the parties with respect to its subject matter and
constitutes (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the agreement among the parties with
respect to its subject matter. This Agreement may not be amended except by a
written agreement executed by Buyer, Seller and Escrow Agent.

    

    14.           Governing
Law.  This Agreement shall be governed by the laws of the State
of New York without regard to conflicts of law principles that would require the
application of any other law.

    

    15.           Force
Majeure. The Escrow Agent shall not be liable to any other party for
losses due to, or if it is unable to perform its obligations under the terms of
this Agreement because of, acts of God, fire, floods, strikes, equipment or
transmission failure, or other causes reasonably beyond its
control.

    

    16.           Compliance
with Court Orders.  In the event that any escrow property shall
be attached, garnished or levied upon by any court order, or the delivery
thereof shall be stayed or enjoined by an order of a court, or any order,
judgment or decree shall be made or entered by any court order affecting the
property deposited under this Agreement, the Escrow Agent is hereby expressly
authorized, in its sole discretion, to obey and comply with all writs, orders or
decrees so entered or issued, which it is advised by legal counsel of its own
choosing is binding upon it, whether with or without jurisdiction, and in the
event that the Escrow Agent obeys or complies with any such writ, order or
decree it shall not be liable to any of the parties hereto or to any other
person, firm or corporation, by reason of such compliance notwithstanding such
writ, order or decree be subsequently reversed, modified, annulled, set aside or
vacated.

    

    [Signature
Pages to Follow]

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    In
Witness Whereof, the parties have executed and delivered this Agreement as of
the date first written above.

     

     

    
    

     

    
      	
               Tax Certification:
      

            	 Taxpayer
      Identification Number (TIN): 	02-0789714	 Date:	 February 14,
      2008

    

    
      
        
          	
                   Name
      & Address:

                	 Best Energy
      Services, Inc.
	 	 1010 Lamar,
      Suite 1200
	 	 Houston, Texas
      77002

        

      

      
        	
                 Customer
      is a (check one):

              

      

      
        	
                 Corporation
      __x__

              	 Partnership____	 Individual/sole
      proprietor ____	 Trust_____

      

      
        	
                 Limited
      liability company____

              	  Enter
      the tax classification (D=disregarded entity, C=Corporation,
      P=Partnership______

      

       

      
        	
                 Other
      _________________

              

      

    

    
      
        
          	
                  Taxpayer
      is (check if applicable):

                
	 _x_ Exempt from
      backup withholding
	 Under the penalties of
      perjury, the undersigned certifies that:
	
                  (1)           the number shown above
      is its correct Taxpayer Identification Number (or it is waiting for a
      number to be issued to it);

                
	
                  (2)            it is not subject to
      backup withholding because: (a) it is exempt from backup withholding or
      (b) it has not been notified by the Internal Revenue Service (IRS) that it
      is subject to backup withholding as a result of failure to report all
      interest or dividends, or (c) the IRS has notified it that it is no longer
      subject to backup withholding; and

                
	
                  (3)           the entity is a U.S.
      person (including a U.S. resident alien).

                
	(If the entity is subject to
      backup withholding, cross out the words after the (2)
    above.)
	
                  Investors
      who do not supply a tax identification number will be subject to backup
      withholding in accordance with IRS regulations.

                
	 Note: The IRS does not require
      your consent to any provision of this document other than the
      certifications required to avoid backup
    withholding.

        

      

      

    

    Buyer:

    Best
Energy Services, Inc.

    

    

    /s/
Larry Hargrave

    Larry
Hargrave, Chief Executive Officer

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                 Tax Certification:
      

              	 Taxpayer
      Identification Number (TIN): 	###-##-#### 	 Date:	 February 14,
      2008

      

      
        
          
            	
                     Name
      & Address:

                  	 Tony
      Bruce
	 	 2081
      Road C
	 	 Liberal,
      Kansas 67901

          

        

        
          	
                   Customer
      is a (check one):

                

        

        
          	
                   Corporation
      ____

                	 Partnership____	 Individual/sole
      proprietor __x__	 Trust_____

        

        
          	
                   Limited
      liability company____

                	  Enter
      the tax classification (D=disregarded entity, C=Corporation,
      P=Partnership______

        

         

        
          	
                   Other
      _________________

                

        

      

      
        
          
            	
                    Taxpayer
      is (check if applicable):

                  
	 _x_ Exempt from
      backup withholding
	 Under the penalties of
      perjury, the undersigned certifies that:
	
                    (1)           the number shown above
      is its correct Taxpayer Identification Number (or it is waiting for a
      number to be issued to it);

                  
	
                    (2)            it is not subject to
      backup withholding because: (a) it is exempt from backup withholding or
      (b) it has not been notified by the Internal Revenue Service (IRS) that it
      is subject to backup withholding as a result of failure to report all
      interest or dividends, or (c) the IRS has notified it that it is no longer
      subject to backup withholding; and

                  
	
                    (3)           the entity is a U.S.
      person (including a U.S. resident alien).

                  
	(If the entity is subject to
      backup withholding, cross out the words after the (2)
    above.)
	
                    Investors
      who do not supply a tax identification number will be subject to backup
      withholding in accordance with IRS regulations.

                  
	 Note: The IRS does not require
      your consent to any provision of this document other than the
      certifications required to avoid backup
    withholding.

          

        

      

    

    
       

    

    Seller:

    Tony
Bruce

    

    

    /s/
Tony Bruce

    Tony
Bruce, individually

     

    Escrow
Agent:

      JPMorgan Chase Bank,
N.A.

     

    /s/ May Ng

    Name: May Ng

    Title: Vice President

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
1

     

    to

     

    Escrow
Agreement

    

    
      	
              Investment:  [specify]

            

    

    
      	
              [X]

            	
              JPMorgan
      Chase Bank Money Market Account;

            

    

    
      	
              [
      ]

            	
              A
      trust account with JPMorgan Chase
Bank;

            

    

    
      	
              
                [
      ]

              

            	
              A
      money market mutual fund, including without limitation the JPMorgan Fund
      or any other mutual fund for which the Escrow Agent or any affiliate of
      the Escrow Agent serves as investment manager, administrator, shareholder
      servicing agent and/or custodian or subcustodian, notwithstanding that (i)
      the Escrow Agent or an affiliate of the Escrow Agent receives fees from
      such funds for services rendered, (ii) the Escrow Agent charges and
      collects fees for services rendered pursuant to this Escrow Agreement,
      which fees are separate from the fees received from such funds, and (iii)
      services performed for such funds and pursuant to this Escrow Agreement
      may at times duplicate those provided to such funds by the Escrow Agent or
      its affiliates.

            
	 	 (Will need to specify name of
      Fund)

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
2

    to

    Escrow
Agreement

     

    
      	
               
      

            	
              Telephone
      Numbers for Call-Backs and

            

    

    
      	
               
      

            	
              Persons Designated to
      Give or Confirm Funds Transfer
  Instructions

            

    

    

    
      	
               
      

            	
              If to
      Buyer:

            

    

     

    
      	 	
              Name

            	
              Telephone
      Number

            	 Signature Specimen
	
              1.

            	
              Larry
      Hargrave

            	
              (713)
      933-2600

            	 /s/ Larry Hargrave
	
              2.

            	
              William
      Weekley

            	
              (713)
      933-2600

            	 /s/
      William Weekley

    

     

    
      	
               
      

            	
              If to
      Seller:

            

    

     

    
    

     

    
      	 	
              Name

            	
              Telephone
      Number

            	 Signature Specimen
	
              1.

            	
              Tony
      Bruce

            	
              (620)
      629-0975

            	 /s/ Tony
  Bruce

    

    

    Telephone
call-backs shall be made to Buyer and Seller if Joint Written Instructions are
required pursuant to this Agreement.  All funds transfer instructions
must include the signature of the persons authorizing said funds transfer and
must not be the same person confirming said transfer.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
3

    to

    Escrow
Agreement

     

    
      Schedule
of Fees for Escrow Agent  Services

    

     

    Based
upon our current understanding of your proposed transaction, our fee proposal is
as follows:

    
    

     

    
      	 Account Acceptance Fee .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . 	
              Waived

            

    

    Encompassing
review, negotiation and execution of governing documentation, opening of the
account, and completion of all due diligence documentation.  Payable
upon closing.

     

    
      	 Annual Administration
      Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . 	
              $2,000.00

            

    

    The
Administration Fee covers our usual and customary ministerial duties, including
record keeping, distributions, document compliance and such other duties and
responsibilities expressly set forth in the governing documents for each
transaction.  Payable upon closing and annually in advance thereafter,
without pro-ration for partial years.

     

    ACTIVITY FEES:
Activity fees will not be assessed for any year in which twelve or fewer
transactions occur.

     

    
      	
              Disbursements

            	 
	 	 
	
              Per
      Check. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . 

            	 $
  35.00
	
              Per
      Wire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . U.S.

            	 $
  35.00
	 International
      	 $ 100.00
	
              Receipts

            	 
	 	 
	 Per Deposit. .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . .	
              $10.00

            
	 	 
	 Investments	 
	 Per directed
      buy/sell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . .	
              $75.00

            
	
              The
      Investments fee will be waived if a JPMorgan Chase money market deposit
      account or interest-bearing trust account is selected.

            	 
	 	 
	 1099 Reporting . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      . . . . . . . . . . .	 $15.00

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    Extraordinary
Services and Out-of Pocket Expenses

    

    Any
additional services beyond our standard services as specified above, and all
reasonable out-of-pocket expenses including attorney's or accountant’s fees and
expenses will be considered extraordinary services for which related costs,
transaction charges, and additional fees will be billed at the Bank's then
standard rate.

    

    Disclosure
& Assumptions

    

    
      	
              ·  

            	
              Please
      note that any proposed fees quoted herein are indicative and not intended
      to be binding or to form an agreement between ourselves. This fee quote is
      subject to a review of the transaction documents and completion of an
      internal due diligence review. JPMorgan reserves the right to revise,
      modify, change and supplement the fees quoted herein.  All fee
      arrangements are subject to a definitive and binding agreement between
      parties.

            

    

    
      	
              ·  

            	
              The
      escrow deposit shall be continuously invested in a JPMorgan Chase Bank
      interest-bearing trust account, a JPMorgan Chase Bank money market deposit
      account (“MMDA”), or a JPMorgan Money Market Fund. The Escrow Agent will
      provide compensation on balances in the escrow account at a rate
      determined by the Escrow Agent from time to time. The Annual
      Administration Fee would include a supplemental charge up to 25 basis
      points on the escrow deposit amount if another investment option were
      chosen.

            

    

    
      	
              ·  

            	
              The
      Parties acknowledge and agree that they are permitted by U.S. law to make
      up to six (6) pre-authorized withdrawals or telephonic transfers from an
      MMDA per calendar month or statement cycle or similar
      period.  If the MMDA can be accessed by checks, drafts, bills of
      exchange, notes and other financial instruments (“Items”), then no more
      than three (3) of these six (6) transfers may be made by an
      Item.  The Escrow Agent is required by U.S. law to reserve the
      right to require at least seven (7) days notice prior to a withdrawal from
      a money market deposit account.

            

    

    
      	
              ·  

            	
              Payment
      of the invoice is due upon receipt.

            

    

    

    Compliance

    

    
      	
              ·  

            	
              To
      help the government fight the funding of terrorism and money laundering
      activities, Federal law requires all financial institutions to obtain,
      verify, and record information that identifies each person or entity that
      opens an account.  We may ask for information that will enable
      us to meet the requirements of the
Act.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}]]