The rights and obligations of Mogul and Powderhorn, as to each well within the drilling program, will be negotiated on a well by well basis.
The LOI constitutes statements of mutual intention on the part of both parties with respect to the contemplated transaction. Neither the LOI nor the proposed terms of the agreements, as outlined in the LOI constitute a binding agreement between the parties as it does not contain all matters upon which an agreement must be reached in order for the transaction to be consummated.
A binding commitment with respect to the transaction contemplated herein will result only from the execution and delivery of the agreements, the terms and conditions of which are currently being negotiated. The LOI will terminate and be of no further force or effect unless the agreements are executed and delivered by July 19, 2010, unless such date is extended by mutual consent of Powderhorn and Mogul.
