BEFORE THE BOARD OF OIL, GAS AND MINING

DEPARTMENTOFNATURALRESOURCESF I L E D IN AND FOR THESTATEOFUTAH

Realeza del Spear, Trabajo del Spear, Gulf Coast Oil & Gas Company, Sun-West Oil & Gas Sun-West Oil & Gas. Inc.,, __ _ PEffiiONERS,

v. Craig Phillips, individually and dba Uinta Oil & Gas, Mountain Oil Inc., and Homeland Gas & Oil. Inc. RESPONDENTS

JUL :12 2016 SECRETARY, BOARD OF

OIL. GAS & MINING

REQUEST FOR AGENCY ACTION

DOCKET NO: 2016-007 and 2016-008

CAUSE NO: 131-143 and 131-144

PETITIONER'S MOTION TO RECOGNIZE SETTLEMENT AGREEMENT

Comes now the Petitioner, Sun-West Oil & Gas ("Petitioner''), and files this Motion to Enforce Settlement Agreement. In support of this motion, Petitioners make the assertions as follows:

Factual Background:

1. Petitioners have previously caused the above actions to be flied against Respondents.

2. Petitioners and Respondents began negotiating a settlement of the causes in late May2016.

3. Respondents sent to Petitioners payments and a draft settlement agreement along with payments for the proposed settlement. See Exhibit #1 (Respondents forms of Settlement and Payments).

4. Petitioners rejected the form of settlement agreement proffered by Respondents and submitted their own to Respondents on June 3. 2016. See Exhibit #2 (N. Spear email to Phillips), Exhibit #2a (Petitioners Proposed Settlement Agreement and Release) and Exhibit #2b (Petitioners Proposed Letter Agreement & Bill of Sale).

5. At 1:01pm, on June 7, 2016, Respondent responded that he approved the

Petitioners Proposed Letter Agreement & Bill of Sale, but that he had questions about the proposed settlement agreement. See Exhibit #3 (Petitioners/ Respondents e-mail string). Specifically, Respondents had a correction to Petitioners identification of Homeland's legal name and Respondents had a question as to paragraph #3 of the proposed settlement agreement.

6. At 3:54pm, on June 7, 2016, Petitioners responded to Respondent that they would finalize the Proposed Letter & Bill of Sale for Respondent's signature. Petitioners also answered questions about the proposed settlement agreement including answering the question why paragraph #3 was worded the way it was worded. See Exhibit #4.

7. At 4:22pm on June 7, 2016, Respondents responded to Petitioners

Nelson & all Nelson please proceed & will sign, homeland intent is to activate the well & we will certainly inform your company and pinnacle co, will disburse Thanks cp HGO See Exhibit #5.

8. At 9:02pm on June 7, 2016, Respondents again responded to Petitioners stating that "[they] need to retract on paragraph 3 ... otherwise [sic] it's not a settlement agreement." See Exhibit #6 (Respondents' retract).

9. Petitioners note that this is not the first time that Homeland has backed out of a settlement agreement with Petitioners. Petitioners state that previously they had entered an oral agreement with Homeland and believed that they had finalized all terms with Homeland. Before a formal settlement agreement could be executed, Homeland quit communicating with Sun-West. On July 7, 2009, Petitioners sent to Homeland an email expressing the disappointment that Sun-West had at the breakdown of communications. See Exhibit #7 (Sun-West/Homeland Settlement).

10. Petitioners ask the Board to take judicial notice of the past cases involving Respondents and the manner of their course of dealing with other parties.

Argument:

Petitioners contend that there was a final and enforceable contract between Petitioners and Respondents.

Under Utah law Contract formation requires an offer, an acceptance, and consideration. Cea v. Hoffman, 276 P.3d 1178, ~ 24 (2012) An offer is a "'manifestation of willingness to enter

2

into a bargain, so made as to justify another person in understanding that his assent to the bargain is invited and will conclude it.' !d. In the present case, Respondents unconditionally accepted the offer put forth by Petitioners which contained consideration by both parties. See Exhibits #3 and #5.

Petitioners need not have a signed contract with Respondent to have an enforceable contract. 'It is a basic ... principle of contract law that agreements are enforceable even though there is neither a written memorialization of that agreement nor the signatures of the parties. McKelvey v. Hamilton, 2009 UT App 126, 211 P.3d 390,397.

WHEREFORE, Petitioner respectfully requests as follows:

A. The Board adopt findings of fact and conclusions of law that there exists a

settlement agreement between Petitioners and Respondents as presented in

Exhibit #2a and Exhibit #2b; and,

B. The Board enters an Order that reflects that:

1. Non-payment of proceeds on the above-referenced wells is intentional,

with full knowledge and without reasonable justification;

2. The Board has jurisdiction over the parties to recognize a settlement

agreement as between them regarding the filed actions;

3. The Settlement Agreement and Release (Exhibit #2a) and Letter

Agreement & Bill of Sale (Exhibit #2b) are valid agreements and are

entered into the above styled causes;

4. Supplemental to its' original Petitions, Petitioners request that Petitioners

be awarded its' reasonable costs associated with its' having to bring this

motion; and,

3

5. Such other relief the Board finds appropriate for Petitioners.

DATED this l th day of July~ 20l.Q.

By: ~Sr--Nelson Spear Sun West Oil & Gas, Inc Realeza del Spear Trabajo del Spear Gulf Coast Oil & Gas P.O. Box 1684 Midland, Texas 79702

4

CERTIFICATE OF SERVICE

I hereby certify that I have this day served the foregoing instrument upon all parties of record in this proceeding by mailing a copy thereof, properly addressed, with postage prepaid, to:

Craig Phillips, individually, and dba Uinta Oil & Gas, Mountain Oil, Inc. and Homeland Gas and Oil, Inc., P.O. Box 1776 Roosevelt, Utah 84066

DATED this l21h day of July3 20l.Q.

By:

Ncl\S Nelson Spear'r===

5

Exh bit #1

4/ 22/ 2016

Homeland Gas & Oil LTD.

P.O. Box 1776

Roosevelt UT 84066

Sent certified mail

Nelson Spear Po Box 1684 Midland TX 79702

Gentlemen

Settlement agreement

Home Land Gas & Oil LTD

P.O. Box 1776

Roosevelt UT 84066

Homeland gas & oil Ltd and the spear group enites as follow agree that Homeland w ill

1. Payment of $1,250 made payable to Rea leza del Spear for past royalties due

2. Payment of $1,250 made payable to Trabajo del Spear for all

equipment etc. associated with the well bore identified as the

Nielsen. No minerals will be conveyed whatsoever

3. This agreement will conclude settlement discussions RE : Homeland Gas & Oil v. Spears

Brothers Group I Sun West Oil and Gas Inc.

4. The third party disbursement will be provided by pinnacle marketing

CC: Nelson Spear

CC: DOGM

Sent: Cert mail

THIS DOCUMENT liAS AN AITIFICIAL WAlERMARK PRINTED ON THE BACK. THE fRONT OF THE OOCUMEHT HAS A MIUOrRINIIJGIIATUIE LINE AND BO~OEl. ASIEHCE OF THESE FEATURES Will INDICATE A COPY.

32~A MOUNrAIN AMERICA ~~~FEDERAL CRED IT UNION CASHIER'S CHECK 0

;;; r .0. Box 9001, VI est Jordon, Utah 84084-9001 • 1-800-748-4302 • m maw. rom AA, OJ SENCE: C€1'flaS. en. "e)' .......... ~~ . .....,.,.. g 0

5 - 709/llO

PAY ** One Thousand Two Hundred Fifty and 00 / 100 DOLLARS **

TO THE ORDER OF REALEZA DEL SPEAR

MEMO: ROALTIES FOR NIELSON 1-20 B1 RE: HOMELAND GAS AND OIL

PAYABLE THROUGH THE BANK OF NEW YORK MELLON, EVERETT, MA

01 3402454

DATE 05 / 26 / 16

$1,250.00

~ ··;;~m,:;;,~· .. cAS'H'i'ER:s··c·H·E·cK· ....... " .. '"'""':: ... ::·::::·:" 0

i P.O. Bol9DOI, lfesl Jordon, Uiah 84084-9001 • 1-800-748-4302 • www.111ace.com ~QJ 5ENCE: CEl'fTE:RS. g ~ n.~.....q.F--'~ 0

PAY . 5-709/llO

** One Thousand Two Hundred Fifty and 00 / 100 DOLLARS **

TO THE ORDER Of TRABAJO DEL SPEAR

MEMO: ALL EQUIPMENT ON NIELSON 1-20 Bl RE: HOME LAND GAS AND OIL

PAYABLE THROUGH THE BANK OF NEW YORK MELLON, EVERETT, MA

DATE 05 / 26 / 16

$1,250.00

M>

Exh bit #1

From: Nelson SpearTo: Craig Phillips (ckp.uog2@gmail.com)Cc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder

(stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: Sec. 20, T 2S, R 1W - Duschene Co UtahDate: Friday, June 03, 2016 12:06:00 PMAttachments: Settlement Agreement (SRS and NBS suggesions).docx

Letter Agreement and Bill of Sale (SRS and NBS suggestions).docx

Mr. Phillips, Please see attached draft forms of Settlement Agreement and Letter Agreement. Please carefully review and if they are acceptable, I will have the documents finalized for everyone’s signature and we will send to you for your execution.

Nelson Spear

Spear Brothers Groupwww.SpearBrothersGroup.comRealeza Del Spear, LPTrabajo Del Spear, LPTierra Del Spear, LP__________________________Spear Brothers Sheep and Cattle Co., LLCSouthern Onshore Exploration, LLCGulf Coast Oil & Gas CompanyConquistador Petroleum, LLCHondo Mining Company, LLC El Kabong Properties, LLCRodeo Oil Company, LLCLos Cinco Picadores, LLCRebel Oil Company, LLCSun-West Oil & Gas, Inc.Bar NND Ranches, LLCInez Investments, Inc._________________

(432)683-8420PO Box 1684Midland, TX 79702______________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

Exh bit #2

SETTLEMENT AGREEMENT AND RELEASE

THIS SETTLEMENT AGREEMENT AND RELEASE ("Settlement Agreement") is

entered into this day of June, 2016, by and between Craig Phillips, individually and

operating and doing business as Home Land Gas & Oil Ltd., (hereinafter collectively referred to

“Respondent”) whose address is P.O. Box 1776, Roosevelt, Utah 84066, on the one hand, and

the Estate of Ellie Sims Spear, the Estate of Howell Roberts Spear, Sun-West Oil & Gas, Gulf

Coast Oil and Gas Company, Realeza del Spear and Trabajo del Spear. (hereinafter collectively

referred to as the “Petitioner”) whose address is P.O, Box 1684, Midland, Texas 79702, on the

other. Respondent and Petitioner may sometimes be referred to herein as “Party” or “Parties.”

RECITALS WHEREAS, on February 29, 2016, Petitioner filed a Request for Agency Action against

Respondent in Cause No 131-143 and Cause No 131-144 for Respondent’s actions concerning

the Nielsen 1-20B1, located in Duchesne County, Utah ; and,

WHEREAS, Respondent and Petitioner desire to settle and compromise all claims,

causes of action, defenses and counterclaims that were asserted or that could have been asserted

in the Action;

NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS, that in consideration

of the covenants and agreements herein contained, and other good and valuable consideration the

receipt and sufficiency whereof are hereby acknowledged, Respondent and the Petitioner agree

as follows:

AGREEMENT 1.0 RELEASE AND DISCHARGE.

1.1 Parties hereby release and forever discharge each other individually and each

other’s officers, directors, shareholders, agents, representatives, parent, subsidiary and any

Exh bit #2

affiliated entities, attorneys and accountants, and their successors and assigns from any and all

claims, demands, actions, causes of action, rights of action, obligations, or liabilities of any

nature whatsoever, including but not limited to damages, principal, penalties, and/or interest,

whether at law or in equity or by statute, known or unknown, through and to include May 31,

2016, arising out of, in connection with or related to the Action, whether or not raised in the

Action (collectively, “Claims”).

1.2 This Release of Claims shall be fully binding and a complete settlement among

the Parties, and their respective past, present and future officers, directors, members,

stockholders, attorneys, agents, servants, representatives, employees, subsidiaries, affiliates,

partners, predecessors and successors in interest, heirs, and assigns, and all other persons, firms

or corporations with whom any of the former have been, are now or may hereafter be affiliated.

1.3 The Parties acknowledge and agree that the Release and Discharge set forth above

is a general release and is without limitation. Petitioner expressly waives and assumes the risk of

all Claims which exist as of this date, but of which Petitioner do not know or suspect to exist,

whether through ignorance, oversight, error, negligence or otherwise, and which, if known,

would materially affect Petitioner’s decision to enter into this Settlement Agreement. Petitioner

further agrees that they have accepted the consideration and payments specified herein as a

complete compromise of matters involving disputed issues of law and fact. Each Party assumes

the risk that the facts or law may be other than either Party believes. It is understood and agreed

to by the Parties that this settlement is a compromise of disputed Claims and is not to be

construed as an admission of liability on the part of either Party, by whom liability is expressly

denied.

Exh bit #2

1.4 The Parties agree that Respondent is solely responsible for any and all surface

damages, environmental damages (including surface and sub-surface damages) and any other

causes of action associated with the Nielsen 1-20B1. If there ever arises any action against

Respondent as it is associated with the Nielsen 1-20B1, Respondent shall indemnify and hold

harmless Petitioner.

2.0 SETTLEMENT PAYMENT.

In consideration of the Release of Claims set forth above, and dismissal of the Action as

specified below:

1). Respondent hereby agrees to pay the total sum of One Thousand, Two hundred Fifty

Dollars ($1,250.00) to Petitioner Realeza del Spear for monies owed to Petitioner through and

including May 31, 2016 for proceeds associated for the Nielson 1-20B1.

2). Respondent hereby agrees to purchase the equipment associated with the well bore of

the Nielsen 1-20B1 for the total sum of One Thousand, Two hundred Fifty Dollars ($1,250.00) to

Petitioner Trabajo del Spear. In conjunction with the aforementioned payment to Trabajo del

Spear, Respondent agrees to contemporaneously execute a purchase agreement entitled “Letter

Agreement & Bill of Sale” with Trabajo del Spear for the aforementioned equipment.

3.0 FUTURE ACTIVITIES WITH THE NIELSEN 1-20B1.

Respondent understands that this Settlement Agreement does not convey any minerals

owned by Petitioner. Respondent also understands that this Settlement Agreement does not

authorize future use of the well bore associated with the Nielsen 1-20B1. Parties agree that

future use of the Nielsen 1-20B1 will be governed by an operating agreement that has not yet

Exh bit #2

been negotiated. Respondent further understands that if an agreement is so negotiated and the

well bore associated with the Nielsen 1-20B1 is brought back on to production, that all

production, whether oil or gas, owed and/or due Petitioner must be paid within 60 days of

collection from Pinnacle Energy Marketing. Any changes of payment from Pinnacle Energy

Marketing to a different third party purchaser must be authorized by Petitioner in writing.

4.0 ATTORNEYS' FEES AND COSTS.

Each Party hereto shall bear its own attorneys' fees, experts’ and consultants’ fees, and

costs in connection with the Claims, the Action, this Settlement Agreement and the matters and

documents referred to herein; provided, however, in the event of a dispute arising under this

Settlement Agreement, the prevailing Party in any judicial action shall be entitled to recover

costs and reasonable attorney fees incurred to enforce this Settlement Agreement.

5.0 TAXES.

Petitioner agrees that they shall be solely responsible for any tax liability resulting from

the payments and consideration they will receive as a result of this Settlement Agreement and

will not look to Respondent for payment of any portion of any tax liability payable as a result of

this Settlement Agreement. Petitioner further acknowledges that no representations have been

made by Respondent or its agents or attorneys concerning the income tax liability resulting from

this Settlement Agreement and that this Settlement Agreement is not given in reliance upon any

such representations. Respondent agrees that they shall be solely responsible for any tax liability

resulting from the payments and consideration they will receive as a result of the Letter

Exh bit #2

Agreement & Bill of Sale and will not look to Petitioner for payment of any portion of any tax

liability payable as a result of the Letter Agreement & Bill of Sale.

6.0 ENTIRE AGREEMENT.

This Settlement Agreement and the Letter Agreement & Bill of Sale contain the entire

agreement between the Parties with regard to the matters set forth herein, and supersedes all prior

understandings or agreements related thereto, whether verbal or written.

7.0 REPRESENTATION OF COMPREHENSION OF DOCUMENTS.

Respondent understands that Petitioner has used attorneys in these matters including the

creation of the Settlement Agreement and the Letter Agreement & Bill of Sale for the equipment

associated with the Nielsen 1-20B1 well bore. Whether or not Respondent retains the use of

legal counsel in these proceedings shall not affect the validity of this Settlement Agreement or

the Letter Agreement & Bill of Sale. In entering into this Settlement Agreement, each Party

represents that the terms of this Settlement Agreement and Letter Agreement & Bill of Sale have

been completely read and that these terms are fully understood and voluntarily accepted by that

Party.

8.0 GOVERNING LAW.

This Settlement Agreement shall be construed and interpreted in accordance with the

laws of the State of Utah.

Exh bit #2

9.0 ADDITIONAL DOCUMENTS.

All Parties agree to cooperate fully and execute any and all supplementary documents

and to take all additional actions which may be necessary or appropriate to give full force and

effect to the basic terms and intent of this Settlement Agreement.

10.0 INVALID PROVISIONS.

If, after the date hereof, any provision of this Settlement Agreement is held to be illegal,

invalid or unenforceable under the present or future laws effective during the term of this

Settlement Agreement, such provision shall be fully severable. In lieu thereof, there shall be

added a provision as similar in terms to such illegal, invalid or unenforceable provision as may

be possible and legal, valid and enforceable. The invalidity of any provision shall not affect the

enforceability of all remaining provisions, which shall remain in full force and effect.

11.0 AMENDMENT.

This Settlement Agreement shall not be modified or amended except by an instrument in

writing signed by all Parties.

12.0 EFFECTIVE DATE.

The effective date of this Settlement Agreement shall be May 31, 2016.

13.0 COUNTERPARTS.

This Settlement Agreement may be executed in several counterparts, each of which shall

be deemed an original and all of which taken together shall constitute a single instrument.

Exh bit #2

Electronically transmitted signatures, whether by facsimile or otherwise, shall be treated by the

Parties as originals.

Exh bit #2

LETTER AGREEMENT & BILL OF SALE

This Letter Agreement & Bill of Sale ("Agreement") is dated effective as of May 31, 2016 and entered into by and between Trabajo Del Spear, LP whose principal address is P.O. Box 1684, Midland, TX 79702 ("Seller") and Homeland Gas & Oil LTD, whose mailing address is P.O. Box 1776, Roosevelt, Utah ("Purchaser"). Seller and Purchaser may be collectively referred to herein as the Parties. This Agreement is being executed contemporaneously with the Settlement Agreement and Release, also executed by the Parties, and is subject to its terms and conditions. WHEREAS, Seller desires to convey to Purchaser all of Seller's proportionate share in and to certain equipment currently located at and associated with the Nielson 1-20B1 Well, API# 4301330740, located on section 20, Township 2 South, Range 1 West, Duchesne County, Utah (collectively the "Equipment"); and WHEREAS, Purchaser desires to accept such conveyance of the Seller’s proportionate share of the Property upon the terms and conditions set forth herein. NOW, THEREFORE, Seller and Purchaser hereby agree as follows: 1. Assignment and Conveyance of Equipment. For ten dollars ($10.00) and such good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties, Seller hereby sells, conveys, transfers, and assigns to Purchaser and Purchaser hereby purchases, acquires and acknowledges receipt from Seller all of Seller's proportionate share of the Equipment. This Agreement also includes all equipment currently on the Property. 2. Warranty. Seller makes no warranty of title of the Equipment. 3. Purchaser assumes all liability associated with the Equipment conveyed, including but not limited to any liability attributable to operations, personal injury and environmental damage to or from the Equipment, its operations or any other amounts owed to or from past, current or future operators. Purchaser acknowledges that Seller has paid all amounts owed associated with its ownership of the Equipment. 4. Further Assurances; Counterparts; Governing Law. Seller agrees to execute such other documents of transfer and other items as may be reasonably requested by Purchaser to sell, transfer and assign its share of the Equipment to Purchaser. This Agreement may be executed in any number of counterparts all of which taken together shall constitute one and the same document. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah without reference to conflicts of law provisions.

Exh bit #2

5. Limited Purchase. The Parties agree that this Agreement is limited to Equipment only associated with the well described herein and is not a conveyance of any surface, mineral or well bore. The Agreement does not apply to any equipment associated with any other well. IN WITNESS WHEREOF, the undersigned have caused this Agreement to be effective on the day and the year first written above. AGREED TO AND ACCEPTED BY: SELLER: Trabajo Del Spear, LP By: _____________________ Name: Shane Spear Title: Manager of Spear Brothers Group, LLC General Partner of Trabajo Del Spear, LP Date: June ______, 2016 PURCHASER: Homeland Gas & Oil LTD By: _____________________ Name: Craig Philips Title: Owner/Principal Date: June _____, 2016

-2-

Exh bit #2

SETTLEMENT AGREEMENT AND RELEASE

THIS SETTLEMENT AGREEMENT AND RELEASE ("Settlement Agreement") is

entered into this day of June, 2016, by and between Craig Phillips, individually and

as President of Home Land Gas & Oil Ltd., a Corporation and Home Land Gas & Oil Ltd., a

Corporation (hereinafter collectively referred to “Respondent”) whose address is P.O. Box 1776,

Roosevelt, Utah 84066, on the one hand, and the Estate of Ellie Sims Spear, the Estate of Howell

Roberts Spear, Sun-West Oil & Gas, Gulf Coast Oil and Gas Company, Realeza del Spear and

Trabajo del Spear. (hereinafter collectively referred to as the “Petitioner”) whose address is P.O,

Box 1684, Midland, Texas 79702, on the other. Respondent and Petitioner may sometimes be

referred to herein as “Party” or “Parties.”

RECITALS

WHEREAS, on February 29, 2016, Petitioner filed a Request for Agency Action against

Respondent in Cause No 131-143 and Cause No 131-144 for Respondent’s actions concerning

the Nielsen 1-20B1, located in Duchesne County, Utah ; and,

WHEREAS, Respondent and Petitioner desire to settle and compromise all claims,

causes of action, defenses and counterclaims that were asserted or that could have been asserted

in the Action;

NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS, that in consideration

of the covenants and agreements herein contained, and other good and valuable consideration the

receipt and sufficiency whereof are hereby acknowledged, Respondent and the Petitioner agree

as follows:

AGREEMENT

1.0 RELEASE AND DISCHARGE.

Exhibit #2a

1.1 Parties hereby release and forever discharge each other individually and each

other’s officers, directors, shareholders, agents, representatives, parent, subsidiary and any

affiliated entities, attorneys and accountants, and their successors and assigns from any and all

claims, demands, actions, causes of action, rights of action, obligations, or liabilities of any

nature whatsoever, including but not limited to damages, principal, penalties, and/or interest,

whether at law or in equity or by statute, known or unknown, through and to include May 31,

2016, arising out of, in connection with or related to the Action, whether or not raised in the

Action (collectively, “Claims”).

1.2 This Release of Claims shall be fully binding and a complete settlement among

the Parties, and their respective past, present and future officers, directors, members,

stockholders, attorneys, agents, servants, representatives, employees, subsidiaries, affiliates,

partners, predecessors and successors in interest, heirs, and assigns, and all other persons, firms

or corporations with whom any of the former have been, are now or may hereafter be affiliated.

1.3 The Parties acknowledge and agree that the Release and Discharge set forth above

is a general release and is without limitation. Petitioner expressly waives and assumes the risk of

all Claims which exist as of this date, but of which Petitioner do not know or suspect to exist,

whether through ignorance, oversight, error, negligence or otherwise, and which, if known,

would materially affect Petitioner’s decision to enter into this Settlement Agreement. Petitioner

further agrees that they have accepted the consideration and payments specified herein as a

complete compromise of matters involving disputed issues of law and fact. Each Party assumes

the risk that the facts or law may be other than either Party believes. It is understood and agreed

to by the Parties that this settlement is a compromise of disputed Claims and is not to be

Exhibit #2a

construed as an admission of liability on the part of either Party, by whom liability is expressly

denied.

1.4 The Parties agree that Respondent is solely responsible for any and all surface

damages, environmental damages (including surface and sub-surface damages) and any other

causes of action associated with the Nielsen 1-20B1. If there ever arises any action against

Respondent as it is associated with the Nielsen 1-20B1, Respondent shall indemnify and hold

harmless Petitioner.

2.0 SETTLEMENT PAYMENT.

In consideration of the Release of Claims set forth above, and dismissal of the Action as

specified below:

1). Respondent hereby agrees to pay the total sum of One Thousand, Two hundred Fifty

Dollars ($1,250.00) to Petitioner Realeza del Spear for monies owed to Petitioner through and

including May 31, 2016 for proceeds associated for the Nielson 1-20B1.

2). Respondent hereby agrees to purchase the equipment associated with the well bore of

the Nielsen 1-20B1 for the total sum of One Thousand, Two hundred Fifty Dollars ($1,250.00) to

Petitioner Trabajo del Spear. In conjunction with the aforementioned payment to Trabajo del

Spear, Respondent agrees to contemporaneously execute a purchase agreement entitled “Letter

Agreement & Bill of Sale” with Trabajo del Spear for the aforementioned equipment.

3.0 FUTURE ACTIVITIES WITH THE NIELSEN 1-20B1.

Respondent understands that this Settlement Agreement does not convey any minerals

owned by Petitioner. Respondent also understands that this Settlement Agreement does not

Exhibit #2a

authorize future use of the well bore associated with the Nielsen 1-20B1. Parties agree that

future use of the Nielsen 1-20B1 will be governed by an operating agreement that has not yet

been negotiated. Respondent further understands that if an agreement is so negotiated and the

well bore associated with the Nielsen 1-20B1 is brought back on to production, that all

production, whether oil or gas, owed and/or due Petitioner must be paid within 60 days of

collection from Pinnacle Energy Marketing. Any changes of payment from Pinnacle Energy

Marketing to a different third party purchaser must be authorized by Petitioner in writing.

4.0 ATTORNEYS' FEES AND COSTS.

Each Party hereto shall bear its own attorneys' fees, experts’ and consultants’ fees, and

costs in connection with the Claims, the Action, this Settlement Agreement and the matters and

documents referred to herein; provided, however, in the event of a dispute arising under this

Settlement Agreement, the prevailing Party in any judicial action shall be entitled to recover

costs and reasonable attorney fees incurred to enforce this Settlement Agreement.

5.0 TAXES.

Petitioner agrees that they shall be solely responsible for any tax liability resulting from

the payments and consideration they will receive as a result of this Settlement Agreement and

will not look to Respondent for payment of any portion of any tax liability payable as a result of

this Settlement Agreement. Petitioner further acknowledges that no representations have been

made by Respondent or its agents or attorneys concerning the income tax liability resulting from

this Settlement Agreement and that this Settlement Agreement is not given in reliance upon any

such representations. Respondent agrees that they shall be solely responsible for any tax liability

Exhibit #2a

resulting from the payments and consideration they will receive as a result of the Letter

Agreement & Bill of Sale and will not look to Petitioner for payment of any portion of any tax

liability payable as a result of the Letter Agreement & Bill of Sale.

6.0 ENTIRE AGREEMENT.

This Settlement Agreement and the Letter Agreement & Bill of Sale contain the entire

agreement between the Parties with regard to the matters set forth herein, and supersedes all prior

understandings or agreements related thereto, whether verbal or written.

7.0 REPRESENTATION OF COMPREHENSION OF DOCUMENTS.

Respondent understands that Petitioner has used attorneys in these matters including the

creation of the Settlement Agreement and the Letter Agreement & Bill of Sale for the equipment

associated with the Nielsen 1-20B1 well bore. Whether or not Respondent retains the use of

legal counsel in these proceedings shall not affect the validity of this Settlement Agreement or

the Letter Agreement & Bill of Sale. In entering into this Settlement Agreement, each Party

represents that the terms of this Settlement Agreement and Letter Agreement & Bill of Sale have

been completely read and that these terms are fully understood and voluntarily accepted by that

Party.

8.0 GOVERNING LAW.

This Settlement Agreement shall be construed and interpreted in accordance with the

laws of the State of Utah.

Exhibit #2a

9.0 ADDITIONAL DOCUMENTS.

All Parties agree to cooperate fully and execute any and all supplementary documents

and to take all additional actions which may be necessary or appropriate to give full force and

effect to the basic terms and intent of this Settlement Agreement.

10.0 INVALID PROVISIONS.

If, after the date hereof, any provision of this Settlement Agreement is held to be illegal,

invalid or unenforceable under the present or future laws effective during the term of this

Settlement Agreement, such provision shall be fully severable. In lieu thereof, there shall be

added a provision as similar in terms to such illegal, invalid or unenforceable provision as may

be possible and legal, valid and enforceable. The invalidity of any provision shall not affect the

enforceability of all remaining provisions, which shall remain in full force and effect.

11.0 AMENDMENT.

This Settlement Agreement shall not be modified or amended except by an instrument in

writing signed by all Parties.

12.0 EFFECTIVE DATE.

The effective date of this Settlement Agreement shall be May 31, 2016.

13.0 COUNTERPARTS.

This Settlement Agreement may be executed in several counterparts, each of which shall

be deemed an original and all of which taken together shall constitute a single instrument.

Exhibit #2a

Electronically transmitted signatures, whether by facsimile or otherwise, shall be treated by the

Parties as originals.

Exhibit #2a

LETTER AGREEMENT & BILL OF SALE

This Letter Agreement & Bill of Sale ("Agreement") is dated effective as of May 31, 2016 and entered into by and between Trabajo Del Spear, LP whose principal address is P.O. Box 1684, Midland, TX 79702 ("Seller") and Homeland Gas & Oil LTD, whose mailing address is P.O. Box 1776, Roosevelt, Utah ("Purchaser"). Seller and Purchaser may be collectively referred to herein as the Parties. This Agreement is being executed contemporaneously with the Settlement Agreement and Release, also executed by the Parties, and is subject to its terms and conditions. WHEREAS, Seller desires to convey to Purchaser all of Seller's proportionate share in and to certain equipment currently located at and associated with the Nielson 1-20B1 Well, API# 4301330740, located on section 20, Township 2 South, Range 1 West, Duchesne County, Utah (collectively the "Equipment"); and WHEREAS, Purchaser desires to accept such conveyance of the Seller’s proportionate share of the Property upon the terms and conditions set forth herein. NOW, THEREFORE, Seller and Purchaser hereby agree as follows: 1. Assignment and Conveyance of Equipment. For ten dollars ($10.00) and such good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties, Seller hereby sells, conveys, transfers, and assigns to Purchaser and Purchaser hereby purchases, acquires and acknowledges receipt from Seller all of Seller's proportionate share of the Equipment. This Agreement also includes all equipment currently on the Property. 2. Warranty. Seller makes no warranty of title of the Equipment. 3. Purchaser assumes all liability associated with the Equipment conveyed, including but not limited to any liability attributable to operations, personal injury and environmental damage to or from the Equipment, its operations or any other amounts owed to or from past, current or future operators. Purchaser acknowledges that Seller has paid all amounts owed associated with its ownership of the Equipment. 4. Further Assurances; Counterparts; Governing Law. Seller agrees to execute such other documents of transfer and other items as may be reasonably requested by Purchaser to sell, transfer and assign its share of the Equipment to Purchaser. This Agreement may be executed in any number of counterparts all of which taken together shall constitute one and the same document. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah without reference to conflicts of law provisions.

Exhibit #2b

-2-

5. Limited Purchase. The Parties agree that this Agreement is limited to Equipment only associated with the well described herein and is not a conveyance of any surface, mineral or well bore. The Agreement does not apply to any equipment associated with any other well. IN WITNESS WHEREOF, the undersigned have caused this Agreement to be effective on the day and the year first written above. AGREED TO AND ACCEPTED BY: SELLER: Trabajo Del Spear, LP By: _____________________ Name: Shane Spear Title: Manager of Spear Brothers Group, LLC General Partner of Trabajo Del Spear, LP Date: June ______, 2016 PURCHASER: Homeland Gas & Oil LTD By: _____________________ Name: Craig Philips Title: Owner/Principal Date: June _____, 2016

Exhibit #2b

From: Craig PhillipsTo: Nelson SpearCc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder

(stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: Re: Sec. 20, T 2S, R 1W - Duschene Co UtahDate: Tuesday, June 07, 2016 1:00:52 PM

To all: Generally speaking the two documents look good, I do have two questions,I am not seeking legal council from you, simply asked intent .The bill of sale looks good As it relates to settlement agreement 1- homeland oil and gas, ltd is a Corparation and I am not sure the phrase doing buiness as or individually is how it should read ,I think it may need to say as president of Corparation ,and if the provisions is to release all parties of potentially liablitys I understand that all remains 2- in #3 it refers to an operating agreement that has not yet been negotiated, my understanding that this ends all working interest via the payment & settlement and that pinnacle would pay the royalty and would be that.We can go back and forth and not include the division in e mails and simply provide the final documents copy so as to not further use there time. Thoughts Craig k phillips HGO Sent from my iPad

On Jun 3, 2016, at 11:11 AM, Nelson Spear <nelson@spearbrothersgroup.com> wrote:

Mr. Phillips, Please see attached draft forms of Settlement Agreement and Letter Agreement. Please carefully review and if they are acceptable, I will have the documents finalized for everyone’s signature and we will send to you for your execution.

Nelson Spear

Spear Brothers Groupwww.SpearBrothersGroup.comRealeza Del Spear, LPTrabajo Del Spear, LPTierra Del Spear, LP__________________________Spear Brothers Sheep and Cattle Co., LLCSouthern Onshore Exploration, LLCGulf Coast Oil & Gas CompanyConquistador Petroleum, LLC

Exh bit #3

Hondo Mining Company, LLC El Kabong Properties, LLCRodeo Oil Company, LLCLos Cinco Picadores, LLCRebel Oil Company, LLCSun-West Oil & Gas, Inc.Bar NND Ranches, LLCInez Investments, Inc._________________

(432)683-8420PO Box 1684Midland, TX 79702______________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

<Settlement Agreement (SRS and NBS suggesions).docx>

<Letter Agreement and Bill of Sale (SRS and NBS suggestions).docx>

Exh bit #3

From: Nelson SpearTo: Craig PhillipsCc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder

(stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: RE: Sec. 20, T 2S, R 1W - Duschene Co UtahDate: Tuesday, June 07, 2016 3:54:00 PM

Mr. Phillips, We will finalize the letter sales agreement for your signature. As to the settlement agreement,

1. My goal was to include all possible parties to the mutual release of liability. I will make the changes that you suggested as to the identification of Homeland; and,

2. As to paragraph 3, we were hesitant to go very far beyond the present facts for several reasons including the fact that the Division did not want to mess with it and the fact that that the well is shut in and you are not sure when any work might commence to attempt to get the well back on line.

With your permission, I will direct the finalization of the settlement agreement as well with the simple change to the identification of Homeland as noted above. Please let me know of your decision.

Nelson Spear

Spear Brothers Group__________________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

From: Craig Phillips [mailto:ckp.uog2@gmail.com] Sent: Tuesday, June 07, 2016 1:01 PMTo: Nelson SpearCc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder (stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: Re: Sec. 20, T 2S, R 1W - Duschene Co Utah To all: Generally speaking the two documents look good, I do have two questions,I am not seeking legal council from you, simply asked intent .The bill of sale looks good As it relates to settlement agreement

Exh bit #4

1- homeland oil and gas, ltd is a Corparation and I am not sure the phrase doing buiness as or individually is how it should read ,I think it may need to say as president of Corparation ,and if the provisions is to release all parties of potentially liablitys I understand that all remains 2- in #3 it refers to an operating agreement that has not yet been negotiated, my understanding that this ends all working interest via the payment & settlement and that pinnacle would pay the royalty and would be that.We can go back and forth and not include the division in e mails and simply provide the final documents copy so as to not further use there time. Thoughts Craig k phillips HGO Sent from my iPad

On Jun 3, 2016, at 11:11 AM, Nelson Spear <nelson@spearbrothersgroup.com> wrote:

Mr. Phillips, Please see attached draft forms of Settlement Agreement and Letter Agreement. Please carefully review and if they are acceptable, I will have the documents finalized for everyone’s signature and we will send to you for your execution.

Nelson Spear

Spear Brothers Groupwww.SpearBrothersGroup.comRealeza Del Spear, LPTrabajo Del Spear, LPTierra Del Spear, LP__________________________Spear Brothers Sheep and Cattle Co., LLCSouthern Onshore Exploration, LLCGulf Coast Oil & Gas CompanyConquistador Petroleum, LLCHondo Mining Company, LLC El Kabong Properties, LLCRodeo Oil Company, LLCLos Cinco Picadores, LLCRebel Oil Company, LLCSun-West Oil & Gas, Inc.Bar NND Ranches, LLCInez Investments, Inc._________________

(432)683-8420PO Box 1684

Exh bit #4

Midland, TX 79702______________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

<Settlement Agreement (SRS and NBS suggesions).docx><Letter Agreement and Bill of Sale (SRS and NBS suggestions).docx>

Exh bit #4

From: Craig PhillipsTo: Nelson SpearCc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder

(stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: Re: Sec. 20, T 2S, R 1W - Duschene Co UtahDate: Tuesday, June 07, 2016 4:22:30 PM

Nelson & allNelson please proceed & will sign, homeland intent is to activate the well & we will certainly inform your company and pinnacle co, will disburse Thanks cp HGO

Sent from my iPad

On Jun 7, 2016, at 2:54 PM, Nelson Spear <nelson@spearbrothersgroup.com> wrote:

Mr. Phillips, We will finalize the letter sales agreement for your signature. As to the settlement agreement,

<!--[if !supportLists]-->1. <!--[endif]-->My goal was to include all possible parties to the mutual release of liability. I will make the changes that you suggested as to the identification of Homeland; and,

<!--[if !supportLists]-->2. <!--[endif]-->As to paragraph 3, we were hesitant to go very far beyond the present facts for several reasons including the fact that the Division did not want to mess with it and the fact that that the well is shut in and you are not sure when any work might commence to attempt to get the well back on line.

With your permission, I will direct the finalization of the settlement agreement as well with the simple change to the identification of Homeland as noted above. Please let me know of your decision.

Nelson Spear

Spear Brothers Group__________________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

Exh bit #5

From: Craig Phillips [mailto:ckp.uog2@gmail.com] Sent: Tuesday, June 07, 2016 1:01 PMTo: Nelson SpearCc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder (stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: Re: Sec. 20, T 2S, R 1W - Duschene Co Utah To all: Generally speaking the two documents look good, I do have two questions,I am not seeking legal council from you, simply asked intent .The bill of sale looks good As it relates to settlement agreement 1- homeland oil and gas, ltd is a Corparation and I am not sure the phrase doing buiness as or individually is how it should read ,I think it may need to say as president of Corparation ,and if the provisions is to release all parties of potentially liablitys I understand that all remains 2- in #3 it refers to an operating agreement that has not yet been negotiated, my understanding that this ends all working interest via the payment & settlement and that pinnacle would pay the royalty and would be that.We can go back and forth and not include the division in e mails and simply provide the final documents copy so as to not further use there time. Thoughts Craig k phillips HGO Sent from my iPad

On Jun 3, 2016, at 11:11 AM, Nelson Spear <nelson@spearbrothersgroup.com> wrote:

Mr. Phillips, Please see attached draft forms of Settlement Agreement and Letter Agreement. Please carefully review and if they are acceptable, I will have the documents finalized for everyone’s signature and we will send to you for your execution.

Nelson Spear

Spear Brothers Groupwww.SpearBrothersGroup.com

Exh bit #5

Realeza Del Spear, LPTrabajo Del Spear, LPTierra Del Spear, LP__________________________Spear Brothers Sheep and Cattle Co., LLCSouthern Onshore Exploration, LLCGulf Coast Oil & Gas CompanyConquistador Petroleum, LLCHondo Mining Company, LLC El Kabong Properties, LLCRodeo Oil Company, LLCLos Cinco Picadores, LLCRebel Oil Company, LLCSun-West Oil & Gas, Inc.Bar NND Ranches, LLCInez Investments, Inc._________________

(432)683-8420PO Box 1684Midland, TX 79702______________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

<Settlement Agreement (SRS and NBS suggesions).docx><Letter Agreement and Bill of Sale (SRS and NBS suggestions).docx>

Exh bit #5

From: Craig PhillipsTo: Nelson SpearSubject: Re: Sec. 20, T 2S, R 1W - Duschene Co UtahDate: Tuesday, June 07, 2016 9:02:05 PM

Nelson, I was finally able to reach my attorney and did a review & I will need to retract on the paragraph 3. To simply restate it to say that well will return to production prior to 1 year shut in period which is November 1 2016, in addition that the pertinent issues are all settled , other wise it's not a settlement agreement Hopefully this change can be implemented . Thanks craig

Sent from my iPad

On Jun 7, 2016, at 2:54 PM, Nelson Spear <nelson@spearbrothersgroup.com> wrote:

Mr. Phillips, We will finalize the letter sales agreement for your signature. As to the settlement agreement,

<!--[if !supportLists]-->1. <!--[endif]-->My goal was to include all possible parties to the mutual release of liability. I will make the changes that you suggested as to the identification of Homeland; and,

<!--[if !supportLists]-->2. <!--[endif]-->As to paragraph 3, we were hesitant to go very far beyond the present facts for several reasons including the fact that the Division did not want to mess with it and the fact that that the well is shut in and you are not sure when any work might commence to attempt to get the well back on line.

With your permission, I will direct the finalization of the settlement agreement as well with the simple change to the identification of Homeland as noted above. Please let me know of your decision.

Nelson Spear

Spear Brothers Group__________________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

Exh bit #6

From: Craig Phillips [mailto:ckp.uog2@gmail.com] Sent: Tuesday, June 07, 2016 1:01 PMTo: Nelson SpearCc: Shane Spear; Cami Bostick; Lori Saunders; Randy Thackeray (randythackeray@utah.gov); Steve Alder (stevealder@utah.gov); Joshua Payne (joshuapayne@utah.gov)Subject: Re: Sec. 20, T 2S, R 1W - Duschene Co Utah To all: Generally speaking the two documents look good, I do have two questions,I am not seeking legal council from you, simply asked intent .The bill of sale looks good As it relates to settlement agreement 1- homeland oil and gas, ltd is a Corparation and I am not sure the phrase doing buiness as or individually is how it should read ,I think it may need to say as president of Corparation ,and if the provisions is to release all parties of potentially liablitys I understand that all remains 2- in #3 it refers to an operating agreement that has not yet been negotiated, my understanding that this ends all working interest via the payment & settlement and that pinnacle would pay the royalty and would be that.We can go back and forth and not include the division in e mails and simply provide the final documents copy so as to not further use there time. Thoughts Craig k phillips HGO Sent from my iPad

On Jun 3, 2016, at 11:11 AM, Nelson Spear <nelson@spearbrothersgroup.com> wrote:

Mr. Phillips, Please see attached draft forms of Settlement Agreement and Letter Agreement. Please carefully review and if they are acceptable, I will have the documents finalized for everyone’s signature and we will send to you for your execution.

Nelson Spear

Spear Brothers Groupwww.SpearBrothersGroup.comRealeza Del Spear, LP

Exh bit #6

Trabajo Del Spear, LPTierra Del Spear, LP__________________________Spear Brothers Sheep and Cattle Co., LLCSouthern Onshore Exploration, LLCGulf Coast Oil & Gas CompanyConquistador Petroleum, LLCHondo Mining Company, LLC El Kabong Properties, LLCRodeo Oil Company, LLCLos Cinco Picadores, LLCRebel Oil Company, LLCSun-West Oil & Gas, Inc.Bar NND Ranches, LLCInez Investments, Inc._________________

(432)683-8420PO Box 1684Midland, TX 79702______________The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

<Settlement Agreement (SRS and NBS suggesions).docx><Letter Agreement and Bill of Sale (SRS and NBS suggestions).docx>

Exh bit #6

From: Nelson SpearTo: DHubner@bathgatepartners.com; DConnolly@q.comSubject: Nielson 1-20B1Date: Tuesday, July 07, 2009 5:15:00 PMAttachments: final draft of release of claim.Nielsen.doc

Mr. Huebner and Ms Connolly, Please let me again express my disappointment at the lack of communication from yourorganization regarding the above named well. Sun-West Oil & Gas has only received onepayment from Creston for a very limited amount of the production attributable to Sun-Westsince Creston has assumed operations of the well and before that it has received paymentsvery sporadically. Creston has recognized Sun-West’s working and royalty interests in thewell, but has repeatedly refused to make any significant accounting or additional payment. Creston reported to me previously that Craig Phillips is to blame for all of the accounting problems;however, Creston has refused to provide me with any documentation (despite my many requests)showing that Phillips is the person to make my claims to. We have previously made claims against Creston/Homeland for sums due and owing to Sun-Westand the Estate of Howell R. Spear. We have previously offered to settle all claims for $5,000.00 and we went as far as to draft and submit a settlement agreement to Creston/Homeland. The divisionorder was issued and executed and recognized by Creston/Homeland. Even though Sun-West has had additional unaccounted for production since that last offer,

we are willing to settle all claims for that same $5,000 provided the settlement can be completed

within 21 days of this e-mail.

We can modify the existing draft of the settlement to accommodate to reflect the current change of facts suchas the date the change of operator that releases Creston/Homeland from duties as operator. Please notify me as soon as possible as to my offer of settlement.

Nelson SpearSpear Brothers GroupSpear Brothers Sheep and Cattle Co., LLCSouthern Onshore Exploration, LLCGulf Coast Oil & Gas CompanyConquistador Petroleum, LLCRodeo Oil Company, LLCLos Cinco Picadores, LLCRebel Oil Company, LLCSun-West Oil & Gas, Inc.Bar NND Ranches, LLCInez Investments, Inc.Howell Spear EstatePrime-Air Fuels__________

(432)683-8420(432)683-8424 (f)__________

Exh bit #7

www.SpearBrothersGroup.com__________

PO Box 1684Midland, TX 79702________________

The information contained in this message is attorney privileged and confidential information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message to sender via email. We will reimburse you for any costs you incur. Thank you.

Exh bit #7

AGREEMENT FOR SETTLEMENT OF CLAIMS AGAINST HOMELAND OIL AND GAS FOR UNPAID FUNDS

This Agreement for Settlement of Claims ("Agreement") is made this 23rd day of April, 2007 between the following: (i) Shane R. Spear, as personal representative of the Estate of Ellie Sims Spear ("Estate of ESS"); (2) Shane R. Spear, as personal representative of the Estate of Howell Robeits Spear ("Estate of HRS"); Nelson Spear, as vice-president of Slm-West Oil & Gas, Inc ("Soo-West"); and, Homeland Gas and Oil Ltd. ("Homeland").

RECITALS

WHEREAS, the Nielson #1-20B1 (Nielson) is an oil and gas well that was spudded in T2S, R1 W, Section 20 on or about July 24, 1983.

WHEREAS, at the time of the spudding of the Nielson, Ellie Sims Spear had a .000893 working interest and Howell Robe1is Spear had a .000892 working interest in the Nielson.

WHEREAS, the Nielson is an oil and gas well that was brought onto production on or about November 8, 1983.

WHEREAS, as a result of the litigation between Sonat Exploration and John Chasel conceming the Nielson, Ellie Sims Spear 's total working interest in the Nielson increased to total working interest of .00095572. Ellie Sims Spear also acquired a royalty interest of .000012 in the Nielson as a result of the same litigation.

WHEREAS, as a result of the litigation between Sonat Exploration and John Chasel conceming the Nielson, Howell Roberts Spear 's total working interest in the Nielson increased to a total working interest of .00095572. Howell Robe1is Spear also acquired a royalty interest of .000012 in the Nielson as a result of the same litigation.

WHEREAS, Ellie Sims Spear died on July 15, 1988. After her death, ShaneR. Spear was appointed personal representative of her estate. The mineral assets of the Estate ofESS were transfened to Slm-West.

WHEREAS, Howell Robeits Spear transfened his entire interest in the Nielson to Slm-West on or about Febmary 7, 1994.

WHEREAS, Homeland assumed operations of the Nielson effective April 7, 2006.

WHEREAS, prior to Homeland assuming operations of the Nielson, prior operators of the Nielson have not paid any proceeds fi:om the Nielson to Ellie Sims Spear or the Estate of ESS since the date of first production.

WHEREAS, prior to Homeland assuming operations of the Nielson, prior operators of the Nielson have paid Howell Robe1is Spear at the inconect rate of .00035547 since the date of first production.

WHEREAS, Homeland, as cunent operator denies that it is responsible for any prior Inissed payments, ooder payments and interest owed due to 1nissed or ooder payments from any prior operators.

WHEREAS, all pruiies to this agreement recognize that they will expend substantial resomces in fmiher pmsuing and/or defending their claims.

1 Exh bit#?

NOW, THEREFORE, for good and valuable consideration to the Estate of ESS, Estate of HRS and Sun-West as provided in this Agreement, and in reliance upon the representations provided by Homeland, the patties agree as follows:

SETTLEMENT:

Homeland, the Estate of ESS, the Estate of HRS and Sun-West, individually and on behalf of each member of the patties, and their respective heirs, assigns, trustees, executors, administr·ators and agents agree:

1. Homeland shall pay the atnount of $4,250.00 to Slm-West to resolve all prior under payment disputes regarding the Nielson. The $4,250.00 payment to Slm-West reflects the monetary claims as follows:

a. $4,000.00 to reflect all under payments and interest owed to the Estate ofESS whose interest is now held by Sun-West; and,

b. $250.00 to reflect all undetpayments and interest owed to Slm-West as a result of the interest it acquired from Howell Robelis Spear on Febmat·y 7, 2004.

2. Homeland shall pay the atnount of $750.00 to the Estate of HRS to resolve all under payment disputes regat·ding the Nielson which reflects all undetpayments and interest owed to the Estate ofHRS.

3. Homeland shall execute a division order for the Nielson in favor of Sun-West. Said division order will be submitted by Slm-West in the natne of Sun-West with a working interest of .00191144 and a royalty interest in the amount of .000024.

4. Homeland shall deliver all revenues from the Nielson to Sun-West in accordance with the submitted division order to Sun-West no longer than sixty days from any sales of any product from the Nielson.

5. The Estate ofESS hereby releases Homeland from the Estate ofESS's claims for unpaid revenue and interest for the Nielson from the date of November 8, 1983 thm and including April 6, 2006.

6. The Estate of HRS hereby releases Homeland from the Estate of HRS's claims for lmpaid revenue and interest for the Nielson from the date of November 8, 1983 thm and including April 6, 2006.

7. Slm-West hereby releases Homeland from the Sun-West 's claims for unpaid revenue and interest for the Nielson from the date of November 8, 1983 thm and including April 6, 2006.

8. The patties to this Agreement agree that the tetms of this settlement at·e made as a result of a compromise among the patties and nothing herein shall be construed or intetpreted as an admission of liability or wrongdoing by any patty. No statement appeat·ing in this Agreement shall be constmed, intetpreted or used as a statement against Homeland's interest other than to enforce the tenns of the Agreement.

9. The effective date of this settlement agreement is April23, 2007.

2 Exh bit#?

This Release is signed by Shane R. Spear, as personal representative of the Estate of HRS and as personal representative of the Estate of ESS; Nelson Spear as Vive­President of Sun-West; and, Bob Ballou as representative of Homeland Oil and Gas.

In case any party to this agreement needs to enforce this agreement, the Laws of the State of Texas will apply.

PARTIES TO SETTLEMENT:

Homeland Gas & Oil, Ltd Bob Ballou

Shane R. Spear Personal Representative of the Estate of Ellie Sims Spear

Shane R. Spear Personal Representative of the Estate of Howell Robett s Spear

Nelson Spear Vice-President Sun-West Oil & Gas, Inc.

3 Exh bit#?

AGREEMENT FOR SETTLEMENT OF CLAIMS AGAINST HOMELAND OIL AND GAS FOR UNPAID FUNDS

This Agreement for Settlement of Claims ("Agreement") is made this 23rd day of April, 2007 between the following: (i) Shane R. Spear, as personal representative of the Estate of Ellie Sims Spear ("Estate of ESS"); (2) Shane R. Spear, as personal representative of the Estate of Howell Robeits Spear ("Estate of HRS"); Nelson Spear, as vice-president of Slm-West Oil & Gas, Inc ("Soo-West"); and, Homeland Gas and Oil Ltd. ("Homeland").

RECITALS

WHEREAS, the Nielson #1-20B1 (Nielson) is an oil and gas well that was spudded in T2S, R1 W, Section 20 on or about July 24, 1983.

WHEREAS, at the time of the spudding of the Nielson, Ellie Sims Spear had a .000893 working interest and Howell Robe1is Spear had a .000892 working interest in the Nielson.

WHEREAS, the Nielson is an oil and gas well that was brought onto production on or about November 8, 1983.

WHEREAS, as a result of the litigation between Sonat Exploration and John Chasel conceming the Nielson, Ellie Sims Spear 's total working interest in the Nielson increased to total working interest of .00095572. Ellie Sims Spear also acquired a royalty interest of .000012 in the Nielson as a result of the same litigation.

WHEREAS, as a result of the litigation between Sonat Exploration and John Chasel conceming the Nielson, Howell Roberts Spear's total working interest in the Nielson increased to a total working interest of .00095572. Howell Robe1is Spear also acquired a royalty interest of .000012 in the Nielson as a result of the same litigation.

WHEREAS, Ellie Sims Spear died on July 15, 1988. After her death, ShaneR. Spear was appointed personal representative of her estate. The mineral assets of the Estate of ESS were transferred to Slm-West.

WHEREAS, Howell Robeits Spear transferred his entire interest in the Nielson to Slm-West on or about Febmmy 7, 1994.

WHEREAS, Homeland assumed operations of the Nielson effective April 7, 2006.

WHEREAS, prior to Homeland assuming operations of the Nielson, prior operators of the Nielson have not paid any proceeds from the Nielson to Ellie Sims Spear or the Estate of ESS since the date of first production.

WHEREAS, prior to Homeland assuming operations of the Nielson, prior operators of the Nielson have paid Howell Robe1is Spear at the incorrect rate of .00035547 since the date of first production.

WHEREAS, Homeland, as cunent operator denies that it is responsible for any prior Inissed payments, ooder payments and interest owed due to Inissed or ooder payments from any prior operators.

WHEREAS, all pmiies to this agreement recognize that they will expend substantial resomces in fmiher pmsuing and/or defending their claims.

1 Exhibit#7a

NOW, THEREFORE, for good and valuable consideration to the Estate of ESS, Estate of HRS and Sun-West as provided in this Agreement, and in reliance upon the representations provided by Homeland, the patt ies agree as follows:

SETTLEMENT:

Homeland, the Estate of ESS, the Estate of HRS and Sun-West, individually and on behalf of each member of the patties, and their respective heirs, assigns, tmstees, executors, administrators and agents agree:

1. Homeland shall pay the atnount of $4,250.00 to Sun-West to resolve all prior under payment disputes regarding the Nielson. The $4,250.00 payment to Slm-West reflects the monetary claims as follows:

a. $4,000.00 to reflect all under payments and interest owed to the Estate of ESS whose interest is now held by Sun-West; and,

b. $250.00 to reflect all undetpayments and interest owed to Slm-West as a result of the interest it acquired from Howell Robetts Speat· on Febmaty 7, 2004.

2. Homeland shall pay the atnount of $750.00 to the Estate of HRS to resolve all under payment disputes regat·ding the Nielson which reflects all undetpayments and interest owed to the Estate ofHRS.

3. Homeland shall execute a division order for the Nielson in favor of Sun-West. Said division order will be submitted by Slm-West in the natne of Sun-West with a working interest of .00191144 and a royalty interest in the atnount of .000024.

4. Homeland shall deliver all revenues from the Nielson to Sun-West in accordance with the submitted division order to Slm-West no longer than sixty days from any sales of any product from the Nielson.

5. The Estate ofESS hereby releases Homeland from the Estate ofESS 's claims for unpaid revenue and interest for the Nielson from the date of November 8, 1983 thm and including April6, 2006.

6. The Estate of HRS hereby releases Homeland from the Estate of HRS's claims for lmpaid revenue and interest for the Nielson from the date of November 8, 1983 thm and including April 6, 2006.

7. Slm-West hereby releases Homeland from the Sun-West's claims for unpaid revenue and interest for the Nielson from the date of November 8, 1983 thm and including April 6, 2006.

8. The patties to this Agreement agree that the tetms of this settlement at·e made as a result of a compromise atnong the patties and nothing herein shall be construed or intetpreted as an admission of liability or wrongdoing by any patty. No statement appeat·ing in this Agreement shall be constmed, intetpreted or used as a statement against Homeland's interest other than to enforce the tenns of the Agreement.

9. The effective date of this settlement agreement is April 23, 2007.

2 Exhibit#7a

This Release is signed by Shane R. Spear, as personal representative of the Estate of HRS and as personal representative of the Estate of ESS; Nelson Spear as Vive­President of Sun-West; and, Bob Ballou as representative of Homeland Oil and Gas.

In case any party to this agreement needs to enforce this agreement, the Laws of the State of Texas will apply.

PARTIES TO SETTLEMENT:

Homeland Gas & Oil, Ltd Bob Ballou

Shane R. Spear Personal Representative of the Estate of Ellie Sims Spear

Shane R. Spear Personal Representative of the Estate of Howell Robeits Spear

Nelson Spear Vice-President Sun-West Oil & Gas, Inc.

3 Exhibit#7a