Document:

SEVENTH AMENDED AND RESTATED SECURITY
AGREEMENT

 

THIS SEVENTH AMENDED
AND RESTATED SECURITY AGREEMENT (this “Agreement”), dated as of May 13, 2013, is made by and among Protalex,
Inc. a Delaware corporation, (the “Grantor”), and Niobe Ventures, LLC (the “Secured Party”)
and amends and restates in its entirety the Sixth Amended and Restated Security Agreement dated as of January 18, 2013 by and between
Grantor and Secured Party.

 

WHEREAS, the Grantor
has issued to the Secured Party a senior secured convertible promissory note in the principal amount of Two Million Dollars ($2,000,000)
dated February 11, 2011 (such note, as amended or modified from time to time, the “$2MM Note”).

 

WHEREAS, the Grantor
has issued to the Secured Party a senior secured promissory note in the principal amount of: (i) One Million Dollars ($1,000,000)
dated February 1, 2012 (such note, as amended or modified from time to time, the “February 2012 Note”);
and (ii) One Million Dollars ($1,000,000) dated June 5, 2012 (such note, as amended or modified from time to time, the “June
2012 Note”).

 

WHEREAS, the Grantor
has issued to the Secured Party a secured promissory note in the principal amount of: (i) Eight Hundred Thousand Dollars ($800,000)
dated October 1, 2012 (such note, as amended or modified from time to time, the “October 2012 Note”); (ii) Seven
Hundred Thousand Dollars ($700,000) dated December 3, 2012 (such note, as amended or modified from time to time, the “December
2012 Note”); and (iii) Two Million Five Hundred Thousand Dollars ($2,500,000) dated January 18, 2013 (such note, as amended
or modified from time to time, the “January 2013 Note”). (Collectively, the February 2012 Note, the June 2012
Note, the October 2012 Note and December 2012 Note are referred to herein as the “2012 Notes”.)

 

WHEREAS, the Secured
Party has made an additional loan to the Grantor and, in that connection, the Grantor has issued to the Secured Party a secured
promissory note in the principal amount of Two Million Dollars ($2,000,000) dated of even date herewith (such note, as amended
or modified from time to time, the “New Note”).

 

WHEREAS, the
Grantor and the Secured Party have agreed to execute and deliver this Agreement, among other things, to secure the obligations
of the Grantor under the $2MM Note, the 2012 Notes, the January 2013 Note and the New Note (hereinafter collectively the “Notes”).

 

The Grantor and the Secured
Party hereby agree as follows:

 

SECTION
1.      Definitions;
Interpretation.

 

(a)               
As used in this Agreement, the following terms shall have the following meanings:

 

“Collateral”
means the property described on Exhibit A attached hereto and all Negotiable Collateral and Intellectual Property to the
extent not described on Exhibit A, except (i) to the extent any such property is nonassignable by its terms without the
consent of the licensor thereof or another party (but only to the extent such prohibition on transfer is enforceable under applicable
law, including, without limitation, applicable provisions of the New York Uniform Commercial Code as amended or
supplemented from time to time.), or (ii) the granting of a security interest in such property is contrary to applicable law, provided
that upon the cessation of any such restriction or prohibition, such property shall automatically become part of the Collateral.

 

    	 

    	 

    

 

“Copyrights”
means any and all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship
and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret, now
or hereafter existing, created, acquired or held.

 

“Event of Default”
has the meaning set forth in the Notes.

 

“Intellectual
Property” means all of Grantor’s right, title, and interest in and to the following, except to the extent any security
interest hereunder would cause any application for a Trademark to be deemed invalidated, canceled or abandoned due to the grant
and/or enforcement of such security interest, including, without limitation, all U.S. trademark applications that are based on
an intent-to-use, unless and until such time that the grant and/or enforcement of the security interest will not affect the status
or validity of such trademark:

 

(a)Copyrights,
Trademarks and Patents;

 

		(b)	and all trade secrets, and any and all intellectual property rights in computer software and computer
software products now or hereafter existing, created, acquired or held;

 

		(c)	and all design rights which may be available to Grantor now or hereafter existing, created, acquired
or held;

 

		(d)	and all claims for damages by way of past, present and future infringement of any of the rights
included above, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the
intellectual property rights identified above;

 

		(e)	licenses or other rights to use any of the Copyrights, Patents or Trademarks, and all license fees
and royalties arising from such use to the extent permitted by such license or rights;

 

		(f)	amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents; and

 

		(g)	proceeds and products of the foregoing, including without limitation all payments under insurance
or any indemnity or warranty payable in respect of any of the foregoing.

 

“Lien”
means any mortgage, deed of trust, pledge, security interest, assignment, deposit arrangement, charge or encumbrance, lien, or
other type of preferential arrangement.

 

“Obligations”
means the indebtedness, liabilities and other obligations of the Grantor to the Secured Party under Notes including without limitation,
the unpaid principal of the Notes and all interest accrued thereon payable by the Grantor to the Secured Party thereunder or in
connection therewith.

 

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“Patents”
means all patents, patent applications and like protections, including, without limitation, improvements, divisions, continuations,
renewals, reissues, extensions and continuations-in-part of the same.

 

“Permitted Liens”
mean: (i) Liens in favor of the Secured Party in respect of the Obligations hereunder; (ii) Liens for taxes, fees, assessments
or other governmental charges or levies, either not delinquent or being contested in good faith by appropriate proceedings and
which are adequately reserved for in accordance with GAAP; (iii) Liens of materialmen, mechanics, warehousemen, carriers or employees
or other like Liens arising in the ordinary course of business and securing obligations either not delinquent or being contested
in good faith by appropriate proceedings; (iv) Liens consisting of deposits or pledges to secure the payment of worker’s
compensation, unemployment insurance or other social security benefits or obligations, or to secure the performance of bids, trade
contracts, leases, public or statutory obligations, surety or appeal bonds or other obligations of a like nature incurred in the
ordinary course of business; (v) easements, rights of way, servitudes or zoning or building restrictions and other minor encumbrances
on real property and irregularities in the title to such property which do not in the aggregate materially impair the use or value
of such property or risk the loss or forfeiture of title thereto; and (vi) Liens upon or in any equipment now or hereafter acquired
or held by the Grantor to secure the purchase price of such equipment or indebtedness incurred solely for the purpose of financing
or refinancing the acquisition of such equipment, provided that the Lien is confined solely to the equipment so acquired and accessions
thereon and proceeds thereof.

 

“Person”
means an individual, corporation, partnership, joint venture, trust, unincorporated organization, governmental agency or authority,
or any other entity of whatever nature.

 

“Trademarks”
means any trademark and service mark rights, whether registered or not, applications to register and registrations of the same
and like protections, and the parts of the goodwill of the business connected with the use of and symbolized by such marks.

 

“UCC”
means the Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York.

 

(b)       Where applicable and except as otherwise defined herein, terms used in this Agreement shall have the meanings assigned
to them in the UCC.

 

(c)       In this Agreement, (i) the meaning of defined terms shall be equally applicable to both the singular and plural
forms of the terms defined; (ii) the captions and headings are for convenience of reference only and shall not affect the
construction of this Agreement; (iii) the words “hereof,” “herein,” “hereto,” “hereunder”
and the like mean and refer to this Agreement as a whole and not merely to the specific Article, Section, subsection, paragraph
or clause in which the respective word appears; (iv) the words “including,” “includes” and “include”
shall be deemed to be followed by the words “without limitation;” and (v) the term “or” shall not be limiting.

 

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SECTION
2.      Security
Interest.

 

(a)       Subject to the Permitted Liens, as security for the payment and performance of the Obligations, the Grantor hereby
pledges, assigns and grants to the Secured Party a security interest in all of the Grantor’s right, title and interest in,
to and under all of the Collateral (other than as set forth in Section 2(b) hereof).

 

(b)       Notwithstanding the foregoing, except for fixtures (to the extent covered by Article 9 of the UCC), such grant
of a security interest shall not extend to, and the term “Collateral” shall not include, any asset which would be real
property under the law of the jurisdiction in which it is located.

 

(c)       This Agreement shall create a continuing security interest in the Collateral that shall remain in effect until terminated
in accordance with the provisions hereof.

 

SECTION
3.      Financing
Statements, Etc. The Grantor hereby authorizes the Secured Party to file (with a copy
thereof to be provided to the Grantor contemporaneously therewith), at any time and from time to time thereafter, all financing
statements, financing statement assignments, continuation financing statements, and UCC filings, in form reasonably satisfactory
to the Secured Party. The Grantor shall execute and deliver and shall take all other action, as the Secured Party may reasonably
request, to perfect and continue perfected, maintain the priority of or provide notice of the security interest of the Secured
Party in the Collateral (subject to the terms hereof) and to accomplish the purposes of this Agreement. Without limiting the generality
of the foregoing, the Grantor ratifies and authorizes the filing by the Secured Party of any financing statements filed prior to
the date hereof that accomplish the purposes of this Agreement. 

 

SECTION
4.      Representations
and Warranties. The Grantor represents and warrants to the Secured Party that:

 

(a)       Grantor is a business
entity duly formed, validly existing and in good standing under the law of the jurisdiction of its organization and has all requisite
power and authority to execute, deliver and perform its obligations under this Agreement.

 

(b)       The execution,
delivery and performance by the Grantor of this Agreement has been duly authorized by all necessary corporate action of the Grantor,
and this Agreement constitutes the legal, valid and binding obligation of the Grantor, enforceable against the Grantor in accordance
with its terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other
laws of general application affecting enforcement of creditors’ rights generally, as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies.

 

(c)       Except for the
filing of appropriate financing statements, no authorization, consent, approval, license, exemption of, or filing or registration
with, any governmental authority or agency, or approval or consent of any other Person, is required for the due execution, delivery
or performance by the Grantor of this Agreement unless the same has already been obtained or is being obtained simultaneously in
connection herewith.

 

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(d)       This Agreement
creates a security interest that is enforceable against the Collateral in which the Grantor now has rights and will create a security
interest that is enforceable against the Collateral in which the Grantor hereafter acquires rights at the time the Grantor acquires
any such rights.

 

(e)       The Grantor has
the right and power to grant the security interests in the Collateral to the Secured Party in the Collateral, and the Grantor is
the sole and complete owner of the Collateral, free from any Lien other than the Permitted Liens.

 

SECTION
5.      Covenants
of the Grantor. Until this Agreement has terminated in accordance with the terms hereof,
the Grantor agrees to do the following:

 

(a)       The Grantor shall give prompt written notice to the Secured Party (and in any event not later than ten (10) days
following any change described below in this subsection) of: (i) any change in the Grantor’s name; (ii) any changes in the
Grantor’s identity or structure in any manner which might make any financing statement filed hereunder incorrect or misleading;
or (iii) any change in jurisdiction of organization; provided that the Grantor shall not locate any Collateral outside
of the United States nor shall the Grantor change its jurisdiction of organization to a jurisdiction outside of the United States.

 

(b)       The Grantor shall not surrender or lose possession of, sell, lease, rent or otherwise dispose of or transfer any
of the Collateral or any right or interest therein, except in the ordinary course of business consistent with past practice and
except to the extent of equipment that is obsolete or no longer useful to its business.

 

(c)       The Grantor shall keep the Collateral free of all Liens except the Permitted Liens.

 

SECTION
6.      Collection
of Accounts. The Grantor shall endeavor in the first instance diligently to collect
all amounts due or to become due on or with respect to the accounts and other rights to payment. 

 

SECTION
7.      Authorization;
Secured Party Appointed Attorney-in-Fact. The Secured Party shall have the right,
to, in the name of the Grantor, or in the name of the Secured Party or otherwise, upon notice to, but without the requirement of
assent by the Grantor, and the Grantor hereby constitutes and appoints the Secured Party (and any employees or agents designated
by a Secured Party) as the Grantor’s true and lawful attorney-in-fact, with full power and authority to: (i) assert, adjust,
sue for, compromise or release any claims under any policies of insurance; and (ii), execute any and all such other documents and
instruments, and do any and all acts and things for and on behalf of the Grantor, that such Secured Party may deem necessary or
advisable to maintain, protect, realize upon and preserve the Collateral and the Secured Party’s security interests therein
and to accomplish the purposes of this Agreement. The Secured Party agrees that, except upon and during the continuance of an Event
of Default, it shall not exercise the power of attorney, or any rights granted to the Secured Party under this Section 7. The foregoing
power of attorney is coupled with an interest and is irrevocable so long as the Obligations have not been indefeasibly paid and
performed in full and the commitments not terminated. The Grantor hereby ratifies, to the extent permitted by law, all that the
Secured Party shall lawfully and in good faith do or cause to be done by virtue of and in compliance with this Section 7.

 

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SECTION
8.      Remedies.

 

(a)       Upon the occurrence and during the continuance of an Event of Default, the Secured Party shall have, in addition
to all other rights and remedies granted to the Secured Party in this Agreement or the Notes, all rights and remedies of a secured
party under the UCC and other applicable laws. Without limiting the generality of the foregoing, upon the occurrence and during
the continuance of an Event of Default, the Secured Party may sell, resell, lease, use, assign, license, sublicense, transfer or
otherwise dispose of any or all of the Collateral in its then condition or following any commercially reasonable preparation or
processing (utilizing in connection therewith any of Grantor’s assets, without charge or liability to any Secured Party therefor)
at public or private sale, by one or more contracts, in one or more parcels, at the same or different times, for cash or credit,
or for future delivery without assumption of any credit risk, all as the Secured Party deem advisable; provided, however, that
the Grantor shall be credited with the net proceeds of sale only when such proceeds are finally collected by the Secured Party.
Each Secured Party shall have the right upon any such public sale, and, to the extent permitted by law, upon any such private sale,
to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption, which right or equity of
redemption the Grantor hereby releases, to the extent permitted by law. The Grantor hereby agrees that the sending of notice by
ordinary mail, postage prepaid, to the address of the Grantor set forth herein or subsequent address that the Grantor provides
to the Secured Party in writing, of the place and time of any public sale or of the time after which any private sale or other
intended disposition is to be made, shall be deemed reasonable notice thereof if such notice is sent ten (10) business days prior
to the date of such sale or other disposition or the date on or after which such sale or other disposition may occur.

 

(b)       The cash proceeds actually received from the sale or other disposition or collection of the Collateral, and any other
amounts received in respect of the Collateral the application of which is not otherwise provided for herein shall be applied first,
to the payment of the reasonable costs and expenses of the Secured Party in exercising or enforcing their rights hereunder and
in collecting or attempting to collect any of the Collateral, and to the payment of all other amounts payable to the Secured Party
pursuant to Section 12 hereof; and second, to the payment of the Obligations. Any surplus thereof that exists after payment
and performance in full of the Obligations shall be promptly paid over to the Grantor or otherwise disposed of in accordance with
the UCC or other applicable law. The Grantor shall remain liable to the Secured Party for any deficiency that exists after any
sale or other disposition or collection of the Collateral.

 

SECTION
9.      Certain
Waivers. 

 

(a)   
The Grantor waives, to the fullest extent permitted by law: (i) any right of redemption with respect to the
Collateral, whether before or after sale hereunder, and all rights, if any, of marshalling of the Collateral or other collateral
or security for the Obligations; (ii) any right to require the Secured Party to: (A) proceed against any Person, (B) exhaust
any other collateral or security for any of the Obligations, (C) pursue any remedy in the Secured Party’s power or (D) except
as provided herein or in any of the Notes, make or give any presentments, demands for performance, notices of nonperformance, protests,
notices of protests or notices of dishonor in connection with any of the Collateral; and (iii) all claims, damages and demands
against the Secured Party arising out of the repossession, retention, sale or application of the proceeds of any sale of the Collateral.

 

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SECTION
10.  Notices.
All notices or other communications which are required or permitted hereunder shall be in writing and sufficient if delivered personally
or sent by nationally-recognized overnight courier or by registered or certified mail, postage prepaid, return receipt requested
or by facsimile, with confirmation as provided above addressed as follows:

 

If to Grantor:

 

Protalex,
Inc.

133 Summit Avenue, Suite 22,

Summit, NJ 07901

Attention:
Chief Financial Officer

 

With copies to:

 

Morse, Zelnick, Rose & Lander LLP

405 Park Avenue, Suite 1401

New York, NY 10022

Attention: Kenneth S. Rose, Esq.

Fax: 212-208-6809

 

If to the Secured Party:

 

Niobe Ventures, LLC

c/o Arnold P. Kling

410 Park Avenue, Suite 1710

New York, NY 10022

Attention: Arnold Kling, Managing
Member

Fax: 212-713-1818

 

With a copy to:

 

Morse, Zelnick, Rose & Lander LLP

405 Park Avenue, Suite 1401

New York, NY 10022

Attention: Kenneth S. Rose, Esq.

Fax: 212-208-6809

 

SECTION
11.  No
Waiver; Cumulative Remedies. No failure on the part of the Secured Party to exercise,
and no delay in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right, remedy, power or privilege preclude any other or further exercise thereof or the exercise
of any other right, remedy, power or privilege. The rights and remedies under this Agreement are cumulative and not exclusive of
any rights, remedies, powers and privileges that may otherwise be available to the Secured Party.

 

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SECTION
12.  Costs
and Expenses. The Grantor agrees to pay all reasonable costs and expenses of the Secured
Party, in connection with the enforcement and preservation of any rights or interests under, this Agreement and the protection,
sale or collection of, or other realization upon, any of the Collateral, including all reasonable expenses of taking, collecting,
holding, sorting, handling, preparing for sale, selling or the like and other such expenses of sales and collections of the Collateral.

 

SECTION
13.  Binding
Effect. This Agreement shall be binding upon, inure to the benefit of and be enforceable
by the Grantor, the Secured Party and their respective successors and assigns.

 

SECTION
14.  Governing
Law. This Agreement shall be governed by and construed under the laws of the State
of New York without regard to principles of conflict of laws.

 

SECTION
15.  Entire
Agreement; Amendment. This Agreement contains the entire agreement of the parties
with respect to the subject matter hereof and shall not be amended except by the written agreement of the Grantor and the Secured
Party. Notwithstanding the foregoing, this Agreement may not be amended and any term hereunder may not be waived with respect to
any Secured Party without the written consent of such Secured Party unless such amendment or waiver applies to all Secured Party
in the same fashion.

 

SECTION
16.  Severability.
Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be valid, legal and enforceable under
all applicable laws and regulations. If, however, any provision of this Agreement shall be invalid, illegal or unenforceable under
any such law or regulation in any jurisdiction, it shall, as to such jurisdiction, be deemed modified to conform to the minimum
requirements of such law or regulation, or, if for any reason it is not deemed so modified, it shall be invalid, illegal or unenforceable
only to the extent of such invalidity, illegality or limitation on enforceability without affecting the remaining provisions of
this Agreement, or the validity, legality or enforceability of such provision in any other jurisdiction.

 

SECTION
17.  Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.

 

SECTION
18.  Termination.
Upon the payment and performance in full of all Obligations, this Agreement shall terminate and the Secured Party shall promptly,
at the cost of the Grantor, execute and deliver to the Grantor such documents and instruments reasonably requested by the Grantor
as shall be necessary to evidence termination of all security interests given by the Grantor to the Secured Party hereunder; provided,
however, that the obligations of the Grantor under Section 12 hereof shall survive such termination.

 

[Signature Page
Follows]

 

 

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IN WITNESS WHEREOF,
the parties hereto have duly executed this Agreement, as of the date first above written.

 

 

GRANTOR:

 

PROTALEX, INC.

 

 

By:_/s/Kirk M. Warshaw_________________

Kirk M. Warshaw, Chief Financial Officer

 

 

NIOBE VENTURES, LLC

 

 

By:_/s/Arnold P. Kling____________________

Arnold
P. Kling, Manager

 

 

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EXHIBIT A

 

COLLATERAL DESCRIPTION ATTACHMENT TO SEVENTH
AMENDED AND RESTATED SECURITY AGREEMENT

 

DEBTORPROTALEX, INC., a Delaware corporation

 

SECURED PARTY:Niobe Ventures, LLC

 

All personal property of Grantor (herein referred to as
“Grantor” or “Debtor”) whether presently existing or hereafter created or acquired, and wherever located
including, without limitation:

 

		(a)	all accounts (including health-care-insurance receivables), chattel paper (including tangible and
electronic chattel paper), deposit accounts, documents (including negotiable documents), equipment (including all accessions and
additions thereto), general intangibles (including payment intangibles and software), goods (including fixtures), instruments (including
promissory notes), inventory (including all goods held for sale or lease or to be furnished under a contract of service, and including
returns and repossessions), investment property (including securities and securities entitlements), letter of credit rights, money,
and all of Grantor’s books and records with respect to any of the foregoing, and the computers and equipment containing
said books and records; provided that notwithstanding the foregoing, "Collateral" shall not include more than 65% of
the stock of any subsidiary that is not incorporated, formed or organized under the laws of the United States, any state thereof
or the District of Columbia (a "Foreign Subsidiary"), or more than 65% of the stock of any subsidiary substantially all
of the assets of which are stock in Foreign Subsidiaries;

 

		(b)	all common law and statutory copyrights and copyright registrations, applications for registration,
now existing or hereafter arising, in the United States of America or in any foreign jurisdiction, obtained or to be obtained on
or in connection with any of the foregoing, or any parts thereof or any underlying or component elements of any of the foregoing,
together with the right to copyright and all rights to renew or extend such copyrights and the right (but not the obligation) of
Secured Party to sue in their own name and/or in the name of the Debtor for past, present and future infringements of copyright;

 

		(c)	all trademarks, service marks, trade names and service names and the goodwill associated therewith,
together with the right to trademark and all rights to renew or extend such trademarks and the right (but not the obligation) of
Secured Party to sue in their own name and/or in the name of the Debtor for past, present and future infringements of trademark;

 

		(d)	all (i) patents and patent applications filed in the United States Patent and Trademark Office
or any similar office of any foreign jurisdiction, and interests under patent license agreements, including, without limitation,
the inventions and improvements described and claimed therein, (ii) licenses pertaining to any patent whether Debtor is licensor
or licensee, (iii) income, royalties, damages, payments, accounts and accounts receivable now or hereafter due and/or payable under
and with respect thereto, including, without limitation, damages and payments for past, present or future infringements thereof,
(iv) right (but not the obligation) to sue in the name of Debtor and/or in the name of Secured Party for past, present and future
infringements thereof, (v) rights corresponding thereto throughout the world in all jurisdictions in which such patents have been
issued or applied for, and (vi) reissues, divisions, continuations, renewals, extensions and continuations-in-part with respect
to any of the foregoing; and

 

		(e)	any and all cash proceeds and/or non-cash proceeds of any of the foregoing, including, without
limitation, insurance proceeds, and all supporting obligations and the security therefor or for any right to payment. All terms
above have the meanings given to them in the New York Uniform Commercial Code, as amended or supplemented from time to
time.The Common Shares (as defined herein)
have not been registered with the Securities and Exchange Commission or the securities commission of any state in reliance upon
an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), and, accordingly,
may not be offered or sold except pursuant to an effective registration statement under the Securities Act or pursuant to an available
exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in accordance with
applicable state securities laws. In making the investment decision, the Purchaser (as defined herein) must rely on its own examination
of the terms of the investment, including the merits and risks involved. The Common Shares have not been recommended by any governmental
or regulatory authority.

 

The Common Shares are subject to
restrictions on transferability and resale and may not be transferred or resold except as permitted under applicable securities
laws. An investment in the Common Shares involves risk. The Purchaser will be required to bear the financial risks of an investment
in the Common Shares for an indefinite period of time.

 

RESTRICTED COMMON STOCK PURCHASE AGREEMENT

 

This RESTRICTED
COMMON STOCK PURCHASE AGREEMENT (this “Agreement”), dated as of January 4, 2013, is made by and between American
Eagle Energy Corporation, a Nevada corporation (the “Company”), and Power Energy Holdings, LLC, an Illinois
limited liability company (the “Purchaser”). The Company and the Purchaser are sometimes individually referred
to in this Agreement as a “Party” and collectively as the “Parties.”

 

WHEREAS, the
Company desires to issue and sell to the Purchaser, and the Purchaser desires to purchase from the Company, an aggregate of 4,000,000
shares of the Company’s common stock, par value $0.001 per share (such 4,000,000 shares of common stock, collectively, the
“Restricted Common Shares”), for an aggregate purchase price of $4,000,000.00, in accordance with the terms
hereof.

 

NOW, THEREFORE,
in consideration of the premises and the mutual covenants contained in this Agreement and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

ARTICLE
I

SALE AND PURCHASE OF the RESTRICTED common SHARES; Closing

 

SECTION 1.01         Sale
and Purchase of the Restricted Common Shares. Subject to
the terms and conditions of this Agreement, at the Closing, the Company shall issue and sell to the Purchaser, and the Purchaser
shall purchase from the Company, the Restricted Common Shares for the purchase price of $1.00 per Restricted Common Share, with
an aggregate purchase price of $4,000,000.00 (the “Purchase Price”). 

 

SECTION 1.02         Closing.
The closing of the issuance, sale, and purchase of the Restricted Common Shares (the “Closing”) shall take place
at the offices of the Company, at 2549 West Main Street, Suite 202, Littleton, Colorado 80120,
at 9:00 a.m. Mountain Standard Time on January 4, 2013, or at such other location or time or on such other date as the Parties
may agree. The date on which the Closing will occur is referred to herein as the “Closing Date.” At the Closing,
the Company shall issue and deliver to the Purchaser a stock certificate (bearing the legend described in Section 3.08), registered
in the name of the Purchaser, representing the Restricted Common Shares in exchange for the payment of the Purchase Price by the
Purchaser to the Company pursuant to the wire transfer instructions furnished by the Company.

 

    	 

    	 

    

 

ARTICLE
II

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

The Company hereby
represents and warrants to the Purchaser as of the Closing Date as follows:

 

SECTION 2.01         Organization
and Good Standing. The Company and its subsidiaries have
been duly incorporated or organized and are validly existing and in good standing under the laws of their respective jurisdictions
of incorporation or organization, are duly qualified to do business, and are in good standing in each jurisdiction in which their
respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and have all
power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged,
except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the
aggregate, have a material adverse effect on the Company and its subsidiaries taken as a whole or on the performance by the Company
of its obligations under this Agreement (a “Company Material Adverse Effect”). 

 

SECTION 2.02         Authority
and Binding Obligation. The Company has the necessary corporate
power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The Company has duly executed
and delivered this Agreement and, assuming due authorization, execution, and delivery hereof by the Purchaser, this Agreement constitutes
the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms, subject
to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, or other similar laws relating to creditors’
rights and general principles of equity.

 

SECTION 2.03         Capitalization.
All issued and outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid
and non-assessable and are not subject to any preemptive rights. Except as disclosed in the Company Reports (as defined in Section
2.08), (i) there are no options, warrants, calls, subscriptions, convertible securities, or other rights, agreements, or commitments
that obligate the Company or any of its subsidiaries to issue, transfer, sell, or register any shares of capital stock or other
securities of the Company or any of its subsidiaries, (ii) there are no outstanding obligations of the Company or any of its subsidiaries
to repurchase, redeem, or otherwise acquire any shares of capital stock of the Company or any of its subsidiaries, and (iii) there
are no outstanding stock appreciation rights, security-based performance units, “phantom” stock, or other security
rights or other agreements or arrangements pursuant to which any person is or may be entitled to receive any payment or other value
based on the revenues, earnings, or financial performance or other attribute of the Company or any of its subsidiaries or assets
or calculated in accordance therewith (other than payments or commissions to employees or agents of the Company or any of its subsidiaries
in the ordinary course of business consistent with past practices). The Company has no outstanding bonds, debentures, notes, or
other obligations, the holders of which have the right to vote (or which are convertible into or exercisable for securities having
the right to vote) with the stockholders of the Company on any matter. There are no voting trusts or other agreements or understandings
to which the Company is a party with respect to the voting of capital stock of the Company.

 

    	- 2 -

    	 

    

 

SECTION 2.04         The
Restricted Common Shares. The Restricted Common
Shares to be issued and sold by the Company hereunder, when issued and delivered and paid for as provided herein, will be duly
authorized, validly issued, fully paid, and nonassessable. The issuance of the Restricted Common Shares is not subject to any preemptive
or similar rights.

 

SECTION 2.05         No
Violation or Default. Neither the Company nor any of its
subsidiaries is: (i) in violation of its articles of incorporation or bylaws or similar organizational documents, (ii) in default,
and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or
observance of any term, covenant, or condition contained in any indenture, mortgage, deed of trust, loan agreement, or other agreement
or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, or (iii) in violation of
any law or statute or any judgment, order, rule, or regulation of any court or arbitrator or governmental or regulatory authority,
except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate,
have a Company Material Adverse Effect.

 

SECTION 2.06         No
Conflicts. The execution, delivery, and performance
by the Company of this Agreement, including the issuance and sale of the Restricted Common Shares, will not: (i) result in any
violation of the provisions of the articles of incorporation or bylaws or similar organizational documents of the Company or any
of its subsidiaries, (ii) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute
a default under, or result in the creation or imposition of any lien, charge, or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan agreement, or other agreement or instrument
to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is subject, or (iii) result in the violation of any law
or statute or any judgment, order, rule, or regulation of any court or arbitrator or governmental or regulatory authority, except,
in the case of clauses (ii) and (iii) above, for any such conflict, breach, violation, or default that would not, individually
or in the aggregate, have a Company Material Adverse Effect.

 

SECTION 2.07         No
Governmental Consents Required. Subject, in part, to the
truth and accuracy of the Purchaser’s representations set forth in Article III, no consent, approval, authorization, order,
license, registration, or qualification of or with any court or arbitrator or governmental or regulatory authority is required
to be obtained or made by the Company for the execution, delivery, and performance by the Company of this Agreement, including
the issuance and sale of the Restricted Common Shares.

 

SECTION 2.08         Financial
Statements. The financial statements (including the related
notes thereto) of the Company and its consolidated subsidiaries included or incorporated by reference in the periodic reports filed
by the Company with the U.S. Securities and Exchange Commission (the “Commission”) since December 31, 2011 (including
exhibits and any amendments thereto or incorporated by reference therein, collectively, the “Company Reports”)
comply in all material respects with the applicable requirements of the Securities Act of 1933, as amended (the “Securities
Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as applicable, and
fairly present in all material respects the financial position of the Company and its consolidated subsidiaries as of the dates
indicated and the results of their operations and the changes in their cash flows for the periods specified (subject, in the case
of unaudited statements, to (i) such exceptions as may be permitted for Quarterly Reports on Form 10-Q filed with the Commission
and (ii) normal, recurring year-end audit adjustments that are not material in the aggregate). Such financial statements have been
prepared in conformity with generally accepted accounting principles in the United States applied on a consistent basis throughout
the periods covered thereby, except as may be noted therein.

 

    	- 3 -

    	 

    

 

SECTION 2.09         No
Company Material Adverse Effect. Since the date of the
most recent financial statements of the Company included or incorporated by reference in the Company Reports, (i) there has not
been any Company Material Adverse Effect and (ii) except for the transactions contemplated by this Agreement and the transactions
identified on Schedule 2.09, the Company and its subsidiaries have conducted their respective businesses in the ordinary
course.

 

SECTION 2.10         No
Other Representations or Warranties. Except for the representations
and warranties made by the Company in this Article II, neither the Company nor any other person makes any representation or warranty
with respect to the Company or its subsidiaries or their respective businesses, operations, assets, liabilities, condition (financial
or otherwise), or prospects, notwithstanding the delivery or disclosure to the Purchaser or any of its affiliates or representatives
of any documentation, forecasts, or other information with respect to any one or more of the foregoing.

 

ARTICLE
III

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

The Purchaser represents
and warrants to the Company as of the Closing Date as follows:

 

SECTION 3.01         Organization
and Good Standing. The Purchaser has been duly organized
and is validly existing and in good standing under the laws of its jurisdiction of organization, is duly qualified to do business,
and is in good standing in each jurisdiction in which its ownership or lease of property or the conduct of its business requires
such qualification, and has all power and authority necessary to own or hold its properties and to conduct the businesses in which
it is engaged, except where the failure to be so qualified, in good standing or have such power or authority would not, individually
or in the aggregate, have a material adverse effect on the Purchaser or on the performance by the Purchaser of its obligations
under this Agreement (a “Purchaser Material Adverse Effect”).

 

SECTION 3.02         Authority
and Binding Obligations. The Purchaser has the necessary
limited liability company power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The
Purchaser has duly executed and delivered this Agreement and, assuming due authorization, execution, and delivery hereof by the
Company, this Agreement constitutes the valid and legally binding obligation of the Purchaser, enforceable against the Purchaser
in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, or
other similar laws relating to creditors’ rights and general principles of equity.

 

SECTION 3.03         No
Conflicts. The execution, delivery, and performance
by the Purchaser of this Agreement, including the purchase of the Common Shares, will not (i) result in any violation of the provisions
of the organizational documents of the Purchaser, (ii) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge, or encumbrance upon
any property or assets of the Purchaser pursuant to, any indenture, mortgage, deed of trust, loan agreement, or other agreement
or instrument to which the Purchaser is a party or by which it is bound or to which any of its properties or assets is subject,
or (iii) result in the violation of any law or statute or any judgment, order, rule, or regulation of any court or arbitrator or
governmental or regulatory authority, except, in the case of clauses (ii) and (iii) above, for any such conflict, breach, violation,
or default that would not, individually or in the aggregate, have a Purchaser Material Adverse Effect.

 

    	- 4 -

    	 

    

 

SECTION 3.04         No
Governmental Consents Required. No consent, approval, authorization,
order, license, registration, or qualification of or with any court or arbitrator or governmental or regulatory authority is required
to be obtained or made by the Purchaser for the execution, delivery, and performance by the Purchaser of this Agreement.

 

SECTION 3.05         Purchase
Entirely for Own Account.  The Purchaser has not
been formed solely for the purpose of making this investment and is acquiring the Restricted Common Shares for its own account
for the purpose of investment only, without any view toward sale or distribution.

 

SECTION 3.06         Accredited
Investor. The Purchaser and each of its members, Robert
Trusz, George P. Archos, and William Jegen, are “accredited investors” within the meaning of Rule 501 of Regulation
D promulgated under the Securities Act.

 

SECTION
3.07          Investment
Experience. The Purchaser has such knowledge and
experience in financial and business matters so as to be able to evaluate the risks and merits of its investment in the
Company and it is able financially to bear the risks thereof.

 

SECTION 3.08         Other
Securities Laws Compliance Matters. The Purchaser understands
that (i) the Restricted Common Shares have not been registered under the Securities Act or qualified under any state securities
or blue sky laws by reason of their issuance in a transaction exempt from the registration requirements of the Securities Act and
the qualification requirements of the various state securities or blue sky laws and, therefore, cannot be resold unless they are
registered under the Securities Act and qualified under applicable state securities laws or unless exemptions from such registration
and qualification requirements are available, (ii) even if the Restricted Common Shares are subsequently registered under
the Securities Act and qualified under state securities or blue sky laws, or exemptions from such registration and qualification
requirements are available, the amount or percentage of the Restricted Common Shares that may be sold or transferred may be limited
by applicable federal and state laws, rules, and regulations, and (iii) no public agency has reviewed the accuracy or adequacy
of any information furnished to the Purchaser and the Purchaser’s representatives in connection with the Purchaser’s
purchase of the Restricted Common Shares. The Purchaser agrees that all stock certificates representing Restricted Common Shares
shall bear the following legend (or substantially equivalent language):

 

“THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE
DISPOSED OF UNLESS REGISTERED UNDER THAT ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT AN EXEMPTION FROM REGISTRATION
THEREUNDER IS AVAILABLE.”

 

    	- 5 -

    	 

    

 

SECTION 3.09         Access
to Information. The Purchaser acknowledges that the Purchaser
has had access to such financial and other information relating to the Company, including the Company Reports and the Company’s
other annual, quarterly, and current reports, registration statements, prospectuses, proxy statements, information statements,
and other documents (including exhibits and amendments ) filed by the Company with the Commission and other publicly available
information regarding the Company, required for the Purchaser to make an informed decision with respect to the Purchaser’s
purchase of the Restricted Common Shares hereby and that the Purchaser has had an opportunity to discuss the Company’s business,
management, and financial affairs with the Company’s management, and has had all of the Purchaser’s questions regarding
the Company or the Restricted Common Shares answered to the Purchaser’s satisfaction. Without limitation of the generality
of the foregoing, the Purchaser further acknowledges that it has had access to certain financial and other information relating
to the Company in connection with the transactions identified on Schedule 2.09. The Purchaser acknowledges that it should
carefully review the risk factors set forth in the Company Reports. The Purchaser is not relying upon any representation or warranty
of any employee, officer, or director of the Company other than as provided herein. The Purchaser has obtained the advice of independent
counsel and tax advisors of the Purchaser’s choice in connection with this Agreement and the transactions contemplated hereby
or has knowingly elected not to receive such counsel.

 

ARTICLE
IV

CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER

 

The obligations of
the Purchaser to purchase and pay for the Restricted Common Shares at the Closing are subject to the satisfaction, at or prior
to the Closing, of the following conditions (any or all of which may be waived by the Purchaser, in whole or in part):

 

SECTION 4.01         Stock
Certificates. The Purchaser shall have received a certificate
representing the Restricted Common Shares (bearing the legend described in Section 3.08).

 

SECTION 4.02         Representations
and Warranties. The representations and warranties contained
in Article II shall be true and correct in all material respects as of the Closing, and an executive officer of the Company shall
have certified to such effect to the Purchaser in writing.

 

SECTION 4.03         Performance.
The Company shall have performed and complied in all material respects with all agreements contained herein required to be performed
or complied with by it at or prior to the Closing and an executive officer of the Company shall have certified to the Purchaser
in writing to such effect.

 

SECTION 4.04         Closing
Certificates. The Purchaser shall have received copies
of the following certificates and other documents:

 

(a)          a
certificate of the Secretary of State of the State of Nevada, dated as of a recent date, as to the good standing of the Company;
and

 

(b)          a
certificate of the Secretary of the Company dated the Closing Date and certifying: 

 

(i)          that
attached thereto are true and complete copies of the articles of incorporation and bylaws of the Company as in effect on the Closing
Date; and

 

(ii)         that
attached thereto is a true and complete copy of all resolutions of the Board of Directors of the Company authorizing the execution,
delivery, and performance of this Agreement, including the issuance and sale of the Restricted Common Shares, and that all such
resolutions are in full force and effect.

 

    	- 6 -

    	 

    

 

SECTION 4.05         No
Actions or Proceedings. No action or proceeding by or before
any court, administrative body, or governmental agency shall have been instituted or threatened that seeks to enjoin, restrain,
or prohibit this Agreement or the consummation of the transactions contemplated by this Agreement. No law or regulation shall be
in effect and no court order shall have been entered in any action or proceeding instituted by any party that enjoins, restrains,
or prohibits this Agreement or the consummation of the transactions contemplated by this Agreement. 

 

ARTICLE
V

CONDITIONS TO the OBLIGATIONS of the company

 

The obligations of
the Company to issue and sell the Restricted Common Shares at the Closing are subject to the satisfaction, at or prior to the Closing,
of the following conditions (any or all of which may be waived by the Company, in whole or in part):

 

SECTION 5.01         Representations
and Warranties. The representations and warranties contained
in Article III shall be true and correct in all material respects as of the Closing, and an executive officer of the Purchaser
shall have certified to such effect to the Company in writing.

 

SECTION 5.02         Performance.
The Purchaser shall have performed and complied in all material respects with all agreements contained herein required to be performed
or complied with by it at or prior to the Closing and an executive officer of the Purchaser shall have certified to the Company
in writing to such effect.

 

SECTION 5.03         No
Actions or Proceedings. No action or proceeding by or before
any court, administrative body, or governmental agency shall have been instituted or threatened that seeks to enjoin, restrain,
or prohibit this Agreement or the consummation of the transactions contemplated by this Agreement. No law or regulation shall be
in effect and no court order shall have been entered in any action or proceeding instituted by any party that enjoins, restrains,
or prohibits this Agreement or the consummation of the transactions contemplated by this Agreement.

 

ARTICLE
VI

INDEMNIFICATION

 

SECTION 6.01         Survival.
All covenants, agreements, representations, and warranties made by either Party in this Agreement, and the indemnification obligations
of the Parties with respect thereto, shall survive the execution and delivery of this Agreement and the Closing and continue in
full force and effect until the one-year anniversary of the Closing Date (the “Expiration Date”). If, at any
time prior to the Expiration Date, any Purchaser Indemnified Party or Company Indemnified Party (as such terms are defined in Sections
6.02 and 6.03, respectively), as the case may be, delivers to the other Party a written notice asserting a claim for indemnification
hereunder, then the claim asserted in such written notice shall survive until such time as such claim is finally resolved. 

 

SECTION 6.02         Indemnification
of the Purchaser. The Company shall indemnify and hold
harmless the Purchaser and each affiliate, member, director, officer, employee, agent, representative, and successor-in-interest
of the Purchaser (the “Purchaser Indemnified Parties”) from and against any and all Losses (as defined below)
asserted against, resulting to, imposed upon, or incurred or suffered by the Purchaser Indemnified Parties, directly or indirectly,
as a result of or arising from (i) any inaccuracy in or breach of any of the representations and warranties made by the Company
in this Agreement or (ii) any breach of or nonperformance by the Company of its covenants, agreements, or other obligations under
this Agreement. For purposes of this Agreement, “Losses” means any loss, damage, liability, settlement, judgment,
award, fine, penalty, or reasonable fee (including reasonable attorneys’ fees), cost, or expense.

 

    	- 7 -

    	 

    

 

SECTION 6.03         Indemnification
of the Company. The Purchaser shall indemnify and hold
harmless the Company and each affiliate, stockholder, director, officer, employee, agent, representative, and successor-in-interest
of the Company ( the “Company Indemnified Parties”) from and against any and all Losses, asserted against, resulting
to, imposed upon, or incurred or suffered by the Company Indemnified Parties, directly or indirectly, as a result of or arising
from (i) any inaccuracy in or breach of any of the representations and warranties made by the Purchaser in this Agreement or (ii)
any breach of or nonperformance by the Purchaser of its covenants, agreements, or other obligations under this Agreement. 

 

SECTION 6.04         Exclusive
Remedies. The remedies provided in this Article VI shall
be deemed the sole and exclusive remedies of the Parties with respect to this Agreement and the transactions contemplated hereby
after the Closing, and no Party shall pursue or seek to pursue any other remedy except for any equitable relief to which any Party
may be entitled or in the case of fraud.

 

ARTICLE
VII

RULE 144; MISCELLANEOUS

 

SECTION 7.01         Rule
144. 

 

(a)          With
a view to making available the benefits of certain rules and regulations of the Commission that may permit the sale of the Restricted
Common Shares to the public without registration, the Company agrees to use its commercially reasonable efforts to:

 

(i)          make
and keep adequate current public information with respect to the Company available in accordance with Rule 144 under the Securities
Act; and

 

(ii)         file
with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the
Exchange Act.

 

(b)          The
Purchaser acknowledges that the Restricted Common Shares must be held indefinitely unless subsequently registered under the Securities
Act or an exemption from such registration is available. The Purchaser is aware of the provisions of Rule 144 promulgated under
the Securities Act that permit resale of shares purchased in a private placement subject to the satisfaction of certain conditions,
which may include, depending on the status of the Purchaser, among other things, the availability of certain current public information
about the Company; the resale occurring not less than a specified period after a party has purchased and paid for the security
to be sold; the number of shares being sold during any three-month period not exceeding specified limitations; the sale being effected
through a “brokers’ transaction,” a transaction directly with a “market maker,” or a “riskless
principal transaction” (as those terms are defined in the Securities Act or the Exchange Act and the rules and regulations
promulgated thereunder); and the filing of a Form 144 notice, if applicable. The Purchaser acknowledges and understands that, notwithstanding
any obligation under Section 7.01(a) above, the Company may not be satisfying the current public information requirement of Rule
144 at the time the Purchaser wishes to sell the Restricted Common Shares, and that, in such event, the Purchaser may be precluded
from selling such securities under Rule 144, even if the other applicable requirements of Rule 144 have been satisfied. The Purchaser
acknowledges that the Company has no obligation to register or qualify the Restricted Common Shares for resale. The Purchaser acknowledges
that, in the event the applicable requirements of Rule 144 are not met, registration under the Securities Act or a different exemption
from registration will be required for any disposition of the Restricted Common Shares. The Purchaser understands that, although
Rule 144 is not exclusive, the Commission has expressed its opinion that persons proposing to sell restricted securities received
in a private offering other than in a registered offering or pursuant to Rule 144 will have a substantial burden of proof in establishing
that an exemption from registration is available for such offers or sales and that such persons and the brokers who participate
in the transactions do so at their own risk.

 

    	- 8 -

    	 

    

 

SECTION 7.02         Brokerage.
Each Party hereto will indemnify and hold harmless the other Party against and in respect of any claim for brokerage or other commissions
relative to this Agreement or to the transactions contemplated hereby, based in any way on agreements, arrangements, or understandings
made or claimed to have been made by such Party with any third party. 

 

SECTION 7.03         Expenses.
Each Party shall pay all of its own fees and expenses incurred in connection with the negotiation, preparation, and execution of
this Agreement.

 

SECTION 7.04         Notices.
All notices, requests, consents, and other communications hereunder shall be in writing and will be deemed to have been duly given
when (i) delivered by hand (with written confirmation of receipt), (ii) received by the addressee, if sent by a nationally recognized
overnight delivery service, (iii) received by the addressee, if mailed by certified or registered mail, return receipt requested,
postage prepaid, or (iv) sent by facsimile or email (with confirmation of receipt), addressed as follows:

 

If to the Company:

 

2549 W. Main Street, Suite 202

Littleton, Colorado 80120

Attention: Bradley M. Colby

Facsimile: (303) 798-5767

 

With a copy to:

(which shall not constitute notice)

 

Baker & Hostetler LLP

600 Anton Blvd., Suite 900

Costa Mesa, California 92626

Attention: Randolf W. Katz

Facsimile: (714) 966-8802

 

If to the Purchaser:

 

Power Energy Holdings, LLC

778 Frontage Rd., Suite 122

Northfield, Illinois 60093

Attention: George P. Archos

Facsimile: (        )
          -           

 

    	- 9 -

    	 

    

 

With a copy to:

(which shall not constitute notice)

 

	 	 
	 	 
	 	 
	Attention:	 	 

Facsimile: (        )
            -            

 

or, in any such case, at such other address or addresses as
shall have been furnished in writing by such Party to the other.

 

SECTION 7.05         Governing
Law. The execution, delivery, and performance of this Agreement
shall be governed by, construed, and enforced in accordance with the laws of the State of Nevada without giving effect to any choice
or conflict of law provision or rule that would cause the application of the laws of any jurisdiction other than the State of Nevada.
Any proceeding seeking to enforce any provision of, or based on any right arising out of, this Agreement shall be brought or otherwise
commenced in any state or federal court of the United States situated in Denver County, Colorado. 

 

SECTION 7.06         Entire
Agreement. This Agreement, including the Schedule hereto,
supersedes all prior agreements between the Parties with respect to its subject matter and constitutes the sole and entire agreement
of the Parties with respect to the subject matter hereof. All Schedules and Exhibits hereto are hereby incorporated herein by reference.

 

SECTION 7.07         Assignments
and Successors. This Agreement shall not be assigned by
either of the Parties (whether by operation of law or otherwise) without the prior written consent of the other Party, which consent
may be withheld, delayed, denied, or conditioned by such Party in its sole and absolute discretion. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of, and be enforceable by the Parties and their respective successors
and assigns.

 

SECTION 7.08         Counterparts;
Effectiveness. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Delivery of an executed counterpart of a signature page to this Agreement by facsimile or in electronic (i.e., “pdf”
or “tif”) format shall be as effective as delivery of a manually executed counterpart of this Agreement. 

 

SECTION 7.09         Amendments.
This Agreement may be amended or modified with the written consent of the Company and the Purchaser. 

 

SECTION 7.10         Severability.
If any provision of this Agreement shall be declared void or unenforceable by any judicial or administrative authority, the validity
of any other provision and of the entire Agreement shall not be affected thereby.

 

SECTION 7.11         Section
Headings; Construction. The headings of Articles and Sections
in this Agreement are for convenience only and are not to be considered in construing or interpreting any term or provision of
this Agreement. All references to “Article”, “Articles”, “Section”, or “Sections”
refer to the corresponding Article, Articles, Section, or Sections (or sub-Section or sub-Sections) of this Agreement. All words
used in this Agreement will be construed to be of such gender or number as the circumstances require. Unless otherwise expressly
provided, the word “including” does not limit the preceding words or terms.

 

    	- 10 -

    	 

    

 

SECTION 7.12         No
Third-Party Beneficiaries. This Agreement shall not confer
any rights or remedies upon any person other than the Parties and their respective successors and permitted assigns, except for
the rights of the Purchaser Indemnified Parties and Company Indemnified Parties under Article VI of this Agreement.

 

[Signatures of the Parties appear on
the next page.]

 

    	- 11 -

    	 

    

 

IN WITNESS WHEREOF,
the undersigned have executed this Restricted Common Stock Purchase Agreement as of the date first set forth above.

 

	 	THE COMPANY:
	 	 
	 	AMERICAN EAGLE ENERGY CORPORATION

 

	 	By:	/s/ Bradley M. Colby
	 	 	Bradley M. Colby, President and
	 	 	Chief Executive Officer

 

	 	THE PURCHASER:
	 	 
	 	POWER ENERGY HOLDINGS, LLC

 

	 	By:	/s/ George P. Archos
	 	 	George P. Archos, authorized signatory

 

    	- 12 -

    	 

    

 

Schedule 2.09

 

		1.	The Company, SM Energy Company (“SM”), and NextEra Resources may enter into
one or a series of agreements that relate to a sale by SM (the “SM Transaction”) to NextEra Resources and the
Company of certain of its interests in certain Company-operated wells and related real property or leases (the “SM Transferred
Interests”). Although no assurances can be given as to whether the SM Transaction will close on the terms that have been
disclosed to the Purchaser, or whether the SM Transaction will close at all, the Company currently expects that the SM Transaction
will close within four weeks of the date hereof. The Company and the Purchaser have entered into discussions, which may result
in the Purchaser being a minority participant (at such closing or thereafter) in the SM Transaction for the purchase of the SM
Transferred Interests and a party to one of more of such agreements.

 

		2.	The Company and the Purchaser may enter into one or a series of agreements that relate to a sale
by the Company to the Purchaser (the “Power Transaction”) of certain of the Company’s production of crude
oil from certain Company-operated wells located in Divide County, North Dakota. Although no assurances can be given as to whether
the Power Transaction will close on the terms that have been discussed between the Company and the Purchaser, or whether the Power
Transaction will close at all, the Company currently expects that the Power Transaction will close within four weeks of the date
hereof.

 

		3.	The Company and NextEra Energy Gas Producing, LLC (“NextEra”) may enter into
one or a series of agreements that relate to a sale by NextEra (the “NextEra Transaction”) to the Company of
certain of NextEra’s interests in certain Company-non-operated wells and related real property or leases (the “NextEra
Transferred Interests”). Although no assurances can be given as to whether the NextEra Transaction will close on the
terms that have been disclosed to the Purchaser, or whether the NextEra Transaction will close at all, the Company currently expects
that the NextEra Transaction will close within four weeks of the date hereof. The Company and the Purchaser have entered into discussions,
which may result in the Purchaser being a minority participant (at such closing or thereafter) in the NextEra Transaction for the
purchase of the NextEra Transferred Interests and a party to one of more of such agreements.

 

		4.	The Company and Macquarie Bank Limited (“Macquarie”) may enter into one or a
series of agreements that relate to a financing in favor of the Company by Macquarie (the “Macquarie Transaction”).
Although no assurances can be given as to whether the Macquarie Transaction will close on the terms that have been disclosed to
the Purchaser, or whether the Macquarie Transaction will close at all, the Company currently expects that the Macquarie Transaction
will close within four weeks of the date hereof.

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