Velocity Energy PRER14C Preliminary revised information

SCHEDULE 14C INFORMATION

Information Statement Pursuant to Section 14(c)

of the Securities Exchange Act of 1934

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RIVER CAPITAL GROUP, INC.

(Name of Registrant As Specified In Charter)

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RIVER CAPITAL GROUP, INC.

Suite 312, 7 Reid Street, Hamilton Bermuda, HM11

Tel.: 441-296-6006

INFORMATION STATEMENT

PURSUANT TO SECTION 14 OF THE SECURITIES EXCHANGE ACT OF 1934,

AS AMENDED, REGULATION 14C, SCHEDULE 14C AND RULE 14f-1 THEREUNDER

WE ARE NOT ASKING YOU FOR A PROXY

AND YOU ARE REQUESTED NOT TO SEND US A PROXY

This Information Statement (this “Information Statement”) is being mailed on or about November __, 2007 to the stockholders of record of River Capital Group, Inc., a Delaware corporation, pursuant to Section 14 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). This Information Statement is being circulated to advise our stockholders of action already approved by written consent of stockholders owning approximately 80.0% of the outstanding shares of our common stock (the “Majority Stockholders”) as permitted under the Delaware General Corporation Law (the “DGCL”). Pursuant to Rule 14c-2 under the Exchange Act, the proposals approved by the Majority Stockholders will not be effective until at least 20 days after the date this Information Statement is mailed to all of our stockholders.

The actions taken by the Majority Stockholders approved:

Amendments (the “Certificate Amendment”) to our certificate of incorporation, as amended (the “Certificate of Incorporation”), to

effect a reverse stock split of our issued and outstanding common stock at a ratio of at least 1-for-5 and up to 1-for-20, the exact ratio subject to the definitive action of our Board of Directors (the “Board of Directors”) within 120 days after the date of the stockholder approval, and retain the current number of authorized shares of common stock reflected in our Certificate of Incorporation; and

b. change our name to “Sonterra Resources, Inc.”; and

2. Adoption of our 2007 Non-Qualified Stock Option Plan.

We are effecting the reverse stock split and changing our name to facilitate a securities exchange (the “Securities Exchange”) in which we will acquire 100% of the outstanding capital stock of Sonterra Resources, Inc., a Delaware corporation (“Sonterra”), which owns certain oil and gas leasehold interests and related assets. This Information Statement contains information required by Section 14(c) of the Exchange Act regarding the Securities Exchange, the acquisition of Sonterra and the adoption of our 2007 Non-Qualified Stock Option Plan. This Information Statement also contains information required under Section 14(f) of the Exchange Act and Rule 14f-1 thereunder in connection with the appointment of a new board member by our current directors to our Board of Directors who, when appointed and upon his acceptance of the appointment and upon resignation of our current directors after such appointment, will be the sole member of our Board of Directors. The Securities Exchange, the acquisition of Sonterra and the appointment of the new sole director will be effective without a meeting of our stockholders. However, if the Securities Exchange is not consummated for any reason, the reverse split, change of our name and the appointment of the new sole director will not occur.

All information in this Information Statement regarding River Capital Group, Inc. and its subsidiaries has been provided by us. All information in this Information Statement regarding Sonterra and its oil and gas properties has been provided by Sonterra.

The record date (the “Record Date”) for determining the stockholders entitled to receive this Information Statement is November __, 2007.

Please note that this is not a notice of a meeting of stockholders and no stockholders meeting will be held to consider the matters described herein.

		By Order of the Board of Directors

		/s/ Howard Taylor
		Howard Taylor
November _______, 2007.		President and Chief Executive Officer

TABLE OF CONTENTS

	Page
SUMMARY TERMS	1

Participants in the Securities Exchange (page 6)	1

The Securities Exchange (page 5)	2

The Reverse Stock Split (page 17) and Change of Name (page 22).	3

Conditions to the Completion of the Securities Exchange (page 13)	3

Termination of the Securities Exchange (page 13)	4

Effect on Control and Management (page 17)	4

The 2007 Non-Qualified Stock Option Plan (page 22)	4

The Written Consent (page 25)	4

GENERAL INFORMATION	5

THE SECURITIES EXCHANGE	5

REVERSE STOCK SPLIT AT A RATIO OF AT LEAST 1-FOR-5 AND UP TO 1-FOR-20	17

OUR NAME CHANGE	22

THE 2007 NON-QUALIFIED STOCK OPTION PLAN	22

AUTHORIZATION BY THE BOARD OF DIRECTORS	24

CONSENTING STOCKHOLDERS	25

THE SONTERRA ACQUISITIONS	26

DESCRIPTION OF OUR CAPITAL STOCK	38

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT	38

NEW DIRECTOR AND EXECUTIVE OFFICER APPOINTEES	40

DIRECTORS AND EXECUTIVE OFFICERS	41

INTEREST OF CERTAIN PERSONS IN THE REVERSE STOCK SPLIT AND THE SECURITIES EXCHANGE	41

EXECUTIVE COMPENSATION	43

COMPANY CORPORATE GOVERNANCE	45

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	46

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE	47

ADDITIONAL INFORMATION	47

DISTRIBUTION OF INFORMATION STATEMENT	47

INDEX TO FINANCIAL STATEMENTS

ANNEX A – Securities Exchange Agreement dated August 3, 2007	A-1

ANNEX B – Certificate of Amendment of the Certificate of Incorporation	B-1

ANNEX C – 2007 Non-Qualified Stock Option Plan	C-1

SUMMARY TERMS

The following summary highlights selected information from this Information Statement regarding the reverse stock split and related change of our name, the Securities Exchange Agreement (as defined below), the Securities Exchange between River Capital Group, Inc. and The Longview Fund, L.P., and our 2007 Non-Qualified Stock Option Plan, and may not contain all of the information that may be important to you. Accordingly, we encourage you to read carefully this entire Information Statement, its annexes and the other documents referred to herein. Each item in this summary includes a page reference directing you to a more complete description of that item. Unless the context otherwise requires, “we”, “us”, “our” and similar terms, as well as references to “the Company”, include River Capital Group, Inc. and subsidiaries, but does not include Sonterra.

Participants in the Securities Exchange (page 6)

River Capital Group, Inc.

Suite 312, 7 Reid Street,

Hamilton, Bermuda, HM11

Tel.: 441-296-6006

We were incorporated in Florida on June 17, 1997 and subsequently reincorporated in Delaware in 1999. Our wholly owned subsidiary, River Capital Holdings Limited, a Barbados exempt corporation (“River Holdings”), is an insurance holding company. River Reinsurance Limited (“River RE”), a Barbados exempt company, is a wholly owned subsidiary of River Holdings and holds an insurance license granted by the Barbados Supervisor of Insurance as an Exempt Insurance Company. Currently, River RE does not conduct operations and we have agreed to divest River Holdings and River RE as promptly as practicable after the Securities Exchange.

The Longview Fund, L.P.(“Longview”)

c/o Viking Asset Management, LLC

600 Montgomery Street, 44th Floor

San Francisco, California 94111

Tel: 415-981-5300

Longview is a private investment fund that is in the business of investing in equity, debt and other securities and assets for its own account. Longview is presently the beneficial owner of approximately 57.8% of our common stock and, after giving effect to the reverse stock split and consummation of the Securities Exchange described in this Information Statement, will be the beneficial owner of approximately 93.7% of our common stock. Longview’s investment advisor is Viking Asset Management, LLC, a California limited liability company (“Viking”), which manages Longview’s investments. Viking may be deemed to be the beneficial owner of our common stock held by Longview. Viking also exercises investment authority for Longview Fund International, Inc. (“LFI”), which beneficially owns 8.8% of our common stock (1.3% after giving effect to the reverse stock split and consummation of the Securities Exchange described in this Information Statement). Longview’s general partner is Viking Asset Management Ltd., a British Virgin Islands international business company.

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Sonterra Resources, Inc. (“Sonterra”)

300 East Sonterra Blvd. Suite 1220

San Antonio, Texas 78258

Tel: 210-545-5994

Sonterra was incorporated in Delaware on April 17, 2007 and is principally engaged in the business of oil and gas exploration and production in the Gulf Coast region. Sonterra has recently acquired certain oil and gas properties and related assets (“Sonterra Acquisitions”) from Cinco Natural Resources Corporation (“Cinco”) and Flash Gas & Oil Southwest, Inc. (“Flash”). The properties and assets acquired in the Sonterra Acquisitions consist of mineral leases that currently encompass approximately 3,500 acres with the opportunity to explore for, develop and produce oil and natural gas in several prospects and a 7-mile natural gas pipeline that connects both of its currently producing offshore wells to an onshore separation facility.

•	The Securities Exchange (page 5)

Longview, Sonterra and the principals of Sonterra are parties to an amended and restated securities purchase agreement (the “Sonterra SPA”), pursuant to which Longview purchased shares of common stock of Sonterra (“Sonterra Common Stock”) for a purchase price of $9,990, a senior secured note in the principal amount of $5,990,010 (the “Sonterra Equity Note”), an additional senior secured note in the principal amount of $2,000,000 (the “Sonterra Non-Equity Note”) and a warrant to purchase 50 shares of Sonterra common stock (the “Sonterra Warrant”). The proceeds of these investments by Longview provided substantially all the funds necessary to enable Sonterra to consummate the Sonterra Acquisitions and pay the fees and expenses incurred by Sonterra in connection with the Sonterra Acquisitions. The Sonterra equity and debt securities held by Longview constitute all of the outstanding equity and debt securities of Sonterra, which owns and operates all the assets acquired in the Sonterra Acquisitions.

On August 3, 2007, we entered into a Securities Exchange and Additional Note Purchase Agreement (the “Securities Exchange Agreement”) with Longview. Pursuant to the Securities Exchange Agreement, Longview has agreed to exchange all its shares of Sonterra Common Stock, the Sonterra Equity Note and the Sonterra Warrant for 218,465,578 shares of our common stock and a warrant to purchase 49,586,777 shares of our common stock (the “Warrant”). The number of shares of our common stock to be issued to Longview and the number of shares issuable upon exercise of the Warrant will each be adjusted to give effect to the reverse stock split described in this Information Statement. The shares of our common stock to be issued to Longview in the Securities Exchange are intended to constitute 85% of the outstanding shares of our common stock after giving effect to the consummation of the Securities Exchange, and the deemed issue price per share of our common stock to be issued pursuant to the Securities Exchange Agreement will be $6,000,000 divided by the number of shares issued to Longview. The Warrant will have a term of 5 years with an exercise price per share equal to 110% of the deemed issue price of our common stock to be issued to Longview in the Securities Exchange and will be exercisable into a number of shares of our common stock equal to the quotient of $1,500,000 divided by the exercise price.

Longview also will exchange the Sonterra Non-Equity Note for our senior secured note in an equal principal amount (the “Initial Note”). Subject to various conditions, we will also have the right in our discretion to require Longview to purchase additional notes in the principal amount of up to $2,000,000 per fiscal quarter (the “Additional Notes,” together with the Initial Note, the “Notes”), up to an aggregate principal amount which, when added to the initial principal amount of the Initial Note, may not exceed an aggregate of $10,000,000 in principal amount of senior secured Notes.

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After giving effect to the Securities Exchange, we will own 100% of the issued and outstanding capital stock of Sonterra and we will be engaged, through Sonterra, in the operation and development of the oil and gas properties and other assets acquired in the Sonterra Acquisitions. Sonterra’s office at 300 East Sonterra Boulevard, Suite 1220, San Antonio, Texas 78258, will become our principal office.

We will be obligated to file a registration statement covering the shares of common stock issuable upon exercise of the Warrant and Longview will also receive demand and piggyback registration rights for our common stock that it will receive in the Securities Exchange.

•	The Reverse Stock Split (page 17) and Change of Name (page 22).

It is a condition to the closing under the Securities Exchange Agreement that we affect the reverse stock split. The Board of Directors has unanimously adopted and declared advisable, and the Majority Stockholders have approved, the Certificate Amendment:

•

to effect a reverse split at a ratio of at least 1-for-5 and up to 1-for-20, the exact ratio subject to the definitive action of the Board of Directors within 120 days after the date of the stockholder approval; and

•

to change our name to “Sonterra Resources, Inc.”

It is expected that the actual ratio at which the reverse stock split is effected will be at least 1- for - 8 because a reverse split at a lower ratio would not make available a sufficient number of authorized but unissued shares of common stock required to effect the transactions under the Securities Exchange Agreement.

The immediate effect of the reverse stock split will be to reduce the number of presently issued and outstanding shares of our common stock. In light of the large number of shares to be issued in the Securities Exchange and the substantial additional shares that will be issuable upon exercise of the Warrant and options to be issued to the Principals, it is unlikely that the market price of our common stock will rise in proportion to the reduction in the number of shares outstanding as a result of the reverse stock split, and there can be no assurances that the reverse stock split will lead to a sustained increase in the market price of our common stock. The market price of our common stock could also change as a result of other unrelated factors, including our operating performance and other factors related to our business, as well as general market conditions.

We will file the Certificate Amendment to the Certificate of Incorporation to effect the reverse stock split and the change of name.

•	Conditions to the Completion of the Securities Exchange (page 13)

Consummation of the Securities Exchange is subject to certain conditions set forth in the Securities Exchange Agreement, including the continued accuracy of Sonterra’s representations and warranties in the Sonterra SPA and its performance of its obligations thereunder, the continued accuracy of our and Longview’s representations and warranties in the Securities Exchange Agreement and our and Longview’s performance of our respective obligations thereunder, approval of the reverse stock split by the Majority Stockholders (which has occurred), the filing of the Certificate Amendment to our Certificate of Incorporation (which is expected to occur immediately prior to the closing of the Securities Exchange), the adoption of our 2007 Non-Qualified Stock Option Plan (which also has occurred) and distribution of this Information Statement to our stockholders.

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• Termination of the Securities Exchange (page 13)

If the Securities Exchange is not consummated on or before the third business day following the earlier of December 31, 2007 and the 20^th day after the mailing of this Information Statement due to our or Longview’s failure to satisfy the conditions precedent to be satisfied by us, the non-breaching party shall have the right to terminate the Securities Exchange Agreement. If the Securities Exchange Agreement is terminated under this provision, provided that Longview is not the breaching party under the Securities Exchange Agreement, we will be obligated to pay Longview’s legal, due diligence and other expenses incurred in connection with the Securities Exchange Agreement.

• Effect on Control and Management (page 17)

Longview is presently the beneficial owner of approximately 57.8% of our common stock and, after giving effect to the reverse stock split and consummation of the Securities Exchange described in this Information Statement, will be the beneficial owner of approximately 93.7% of our common stock. Consummation of the Securities Exchange will therefore increase Longview’s existing controlling interest in us and will similarly increase Viking’s beneficial ownership of our common stock. Furthermore, LFI, an affiliate of Viking, for which Viking exercises investment authority, beneficially owns an additional 8.8% of our common stock (1.3% after giving effect to the Securities Exchange and reverse stock split).

In addition, each of Michael Pawelek, Wayne Psencik and Sherry Spurlock, each of whom is currently an executive officer of Sonterra, will become an executive officer of our company at the closing of the Securities Exchange and Mr. Pawelek will be elected a director. We expect that our current directors, Howard Taylor and William Dickie and our current officers will submit their resignation as our directors and officers at the closing so that immediately after the closing of the Securities Exchange and upon such resignation, Mr. Pawelek will be our sole director.

• The 2007 Non-Qualified Stock Option Plan (page 22)

Upon consummation of the Securities Exchange, we will establish the 2007 Non-Qualified Stock Option Plan (the “2007 Plan”), pursuant to which we will grant options to Messrs. Pawelek and Psencik and Ms. Spurlock to purchase a total of 51,403,665 shares of common stock, subject to adjustment to reflect the reverse stock split. The number of shares underlying these options will constitute, in the aggregate, 20% of our outstanding common stock after giving effect to the reverse stock split and the Securities Exchange. The Board of Directors has unanimously approved the 2007 Plan and the Majority Stockholders have also approved the 2007 Plan.

• The Written Consent (page 25)

On ________ ___, 2007, Longview, the record holder of 22,285,614 shares (approximately 57.8%) of our common stock, LFI, the record holder of 3,390,660 shares (approximately 8.8%) of our common stock, and Concorde Capital Limited, a corporation wholly owned by Mr. Howard Taylor, our President and Chief Executive Officer and the owner of record of 5,156,639 shares (approximately 13.4%) of our common stock consented in writing to the reverse stock split, the change of our name and the related amendments to our Certificate of Incorporation, and approval of the 2007 Plan.

• Dissenters’ Rights (page 34)

No dissenter’s rights are available under the Delaware General Corporation Law or under the our certificate of incorporation or bylaws with respect to the reverse stock split.

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RIVER CAPITAL GROUP, INC.

Suite 312, 7 Reid Street, Hamilton Bermuda, HM11

Tel.: 441-296-6006

GENERAL INFORMATION

This Information Statement is first being mailed on or about November ___, 2007 to our stockholders of record on the Record Date to provide material information regarding corporate actions that have been approved by the written consent of the Majority Stockholders and certain transactions to be effected by us that require, as a condition precedent, the actions taken by the Majority Stockholders.

Only one Information Statement is being delivered to two or more stockholders who share an address unless we have received a contrary instruction from one or more of such stockholders. We will promptly deliver, upon written or oral request, a separate copy of this Information Statement to a stockholder at a shared address to which a single copy of the document was delivered. If you would like to request additional copies of this Information Statement, or if in the future you would like to receive multiple copies of Information Statements or proxy statements, or annual reports, or if you are currently receiving multiple copies of these documents and would, in the future, like to receive only a single copy, please so instruct us by writing to the corporate secretary at our executive offices at the address specified above.

Please note that this is not a request for your vote or a proxy statement, but rather an Information Statement designed to inform you of the matters described herein pursuant to sections 14(c) and 14(f) of the Securities Exchange Act, as amended (the “Exchange Act”), and the regulations promulgated thereunder. This is not a notice of a meeting of stockholders and no stockholders meeting will be held to consider the matters described herein. We are not asking you for a proxy and you are requested not to send us a proxy.

The entire cost of furnishing this Information Statement will be borne by us. We will request brokerage houses, nominees, custodians, fiduciaries and other like parties to forward this Information Statement to the beneficial owners of our common stock held of record by them and will reimburse such persons for out-of-pocket expenses incurred in forwarding this Information Statement.

THE SECURITIES EXCHANGE

Our development and business prior to the Securities Exchange Agreement

On December 30, 2005, we executed and closed a Share Exchange Agreement, as amended, with River Holdings, Strategy International Insurance Group, Inc., Longview, Longview Equity Fund, LP, Longview International Equity Fund, LP, and Concorde Capital Limited. In this exchange, we acquired 100% of the issued and outstanding shares of the common stock of River Holdings and the River Holdings shareholders received an aggregate of 19,135,820 shares of our common stock.

On December 31, 2006, we entered into a Mutual Release and Settlement Agreement with the holders of our convertible notes, Longview, Longview Equity Fund, LP, and Longview International Equity Fund, LP. Under the terms of that agreement, we issued to the holders of our convertible notes: (i) 11,045,474 shares of our common stock at a stipulated purchase price of $0.05 per share, and (ii) an additional 925,000 shares of our common stock also at a stipulated purchase price of $0.05 per share, as part of a warrant exercise, in exchange for forgiveness of the entire amount owing under the convertible notes. Longview and its affiliates acquired their respective holdings of our common stock pursuant to the Share Exchange Agreement and the Mutual Release and Settlement Agreement.

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River Holdings was incorporated on October 6, 2004 as an insurance holding company. River RE is a wholly owned subsidiary of River Holdings. River Holdings incorporated River RE on December 1, 2005 as a Barbados exempt company and filed a license application for River RE as a Barbados Exempt Insurance Company on December 16, 2005 (River Holdings and River RE are together referred to as the “Insurance Subsidiaries”). On June 16, 2006, River RE was formally licensed by the Barbados Supervisor of Insurance as an Exempt Insurance Company. As a licensed Exempt Insurance Company, River RE may conduct general insurance business, including property and casualty reinsurance and credit reinsurance. River RE’s license enables it to conduct its insurance business with entities other than its parent, River Holdings, so long as the risks insured, premiums and related beneficiary originate from outside of CARICOM (Caribbean Community).

When we acquired River Holdings and River RE, we intended to establish and grow a core reinsurance business based on the development and acquisition of insurance and reinsurance assets and businesses. We expected that River RE would develop, underwrite and acquire business that represented relatively low risk over the long term. Over time, we expected that River RE would leverage its internal capabilities to raise initial capital, establish relationships in the institutional investment markets, add to senior management and manage the capital assets held by River RE. We estimated that we required an ongoing financial commitment of $10,000,000 to support our growth plan for River RE over 12 months and to maintain our service readiness. We were, however, unable to raise equity or debt capital in the public or private markets, and River RE has not entered into any formal agreements with any insurance intermediary, primary insurance company, insurance manager or insurance broker or conducted any business.

Based on our plan to develop and grow a reinsurance business through River RE, we stated in our Annual Report on Form 10-KSB for the year ended December 31, 2006 that we were a development stage company. As noted above, however, we were unable to raise capital for those purposes and, as more fully described below, we have committed in the Securities Exchange Agreement to divest our interests in River Holdings and River RE. We received no revenues and conducted no business during the year ended December 31, 2006 and during the first six months of 2007, and, as result of our abandonment of our efforts to develop a reinsurance business, we may be deemed to be a “shell company” within the meaning of the rules of the Securities and Exchange Commission (“SEC”). Upon consummation of the Securities Exchange, we believe we will cease being a shell company. We have agreed to divest the Insurance Subsidiaries as promptly as practicable after the Securities Exchange with Longview described in this Information Statement.

Participants in the Securities Exchange

River Capital Group, Inc.

Suite 312, 7 Reid Street,

Hamilton, Bermuda, HM11

Tel.: 441-296-6006

We were incorporated in Florida on June 17, 1997, as Permastoprust International, Inc. We changed our name to Greystone Credit Inc. in June 1999. On August 4, 1999, we acquired whOOdoo.com, Inc., a Florida corporation incorporated on April 9, 1999, in a share exchange. In connection with the share exchange, we changed our state of incorporation to Delaware and our name to whOOdoo.com, Inc. On July 17, 2000, we changed our name to Ballistic Ventures, Inc. and on June 5, 2004, we changed our name to River Capital Group, Inc.

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The Longview Fund, L.P.

c/o Viking Asset Management, LLC

600 Montgomery Street, 44th Floor

San Francisco, California 94111

Tel: 415-981-5300

Longview is a private investment fund that is in the business of investing in equity, debt and other securities and assets for its own account. Longview is presently the beneficial owner of 22,285,614 shares (approximately 57.8%) of our common stock which it acquired in the December 2005 share exchange pursuant to which we acquired the Insurance Subsidiaries and in the settlement in December 2006 of our obligations under certain convertible notes we had issued to Longview and others. After giving effect to the reverse stock split and consummation of the Securities Exchange between us and Longview as described in this Information Statement, Longview will be the beneficial owner of approximately 93.7% of our common stock. Viking serves as the investment advisor for Longview and manages Longview’s investments. Viking may be deemed to be the beneficial owner of our common stock held by Longview. Viking also exercises investment authority for LFI, which beneficially owns 3,390,660 shares, approximately 8.8% of our common stock currently and approximately 1.3% of our common stock after giving effect to the reverse stock split and consummation of the Securities Exchange between us and Longview described in this Information Statement. Longview’s general partner is Viking Asset Management Ltd., a British Virgin Islands international business company.

Sonterra Resources, Inc.

300 East Sonterra Blvd. Suite 1220

San Antonio, Texas 78258

Tel: 210-545-5994

Sonterra was incorporated in Delaware on April 17, 2007 and is principally engaged in the business of oil and gas exploration and production in the Gulf Coast region. Sonterra recently acquired certain oil and gas exploration and development properties and related assets from Cinco and Flash. The properties and assets acquired from Cinco and Flash currently consist of mineral leases currently encompassing approximately 3,500 acres with the opportunity to explore for, develop and produce oil and natural gas in several prospects and a 7-mile natural gas pipeline that connects both of its currently producing offshore wells to an onshore separation facility. See “The Sonterra Acquisitions.”

In the Sonterra Acquisitions, Sonterra acquired certain working interests and lease interests in the Shark Prospect in Matagorda Bay, Calhoun County, Texas, covering approximately 320 acres; Ray Prospect in Matagorda Bay, Matagorda and Calhoun Counties, Texas; Starfish Prospect in Matagorda Bay, Calhoun County, Texas, covering approximately 320 acres; Barracuda Prospect in Matagorda Bay, Calhoun County, Texas, Mackerel Prospect in Calhoun and Matagorda Counties, Texas. For a description of the properties acquired by Sonterra in the Sonterra Acquisitions, see “The Sonterra Acquisitions” in this Information Statement. For certain financial and oil and gas reserve information relating to the properties acquired in the Sonterra Acquisitions, see Note C of the Notes to Audited Financial Statements of Certain Acquired Oil and Gas Properties. Upon consummation of the Securities Exchange with Longview, Sonterra will become our wholly owned subsidiary and we will be engaged, through Sonterra, in the operation and development of the oil and gas properties and other assets acquired in the Sonterra Acquisitions. Sonterra’s office at 300 East Sonterra Boulevard, Suite 1220, San Antonio, Texas, 78258 will become our principal office.

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Sonterra was formed by the Principals, each of whom was employed by Boss Exploration and Production Company (“BOSS”) through October 2007. Sonterra and BOSS are negotiating a transition services agreement pursuant to which BOSS would provide certain services to Sonterra and operate its assets and properties and are also discussing the possible purchase of certain property by Sonterra from BOSS. Upon consummation of the Securities Exchange with Longview, each of the Principals will become an executive officer and Mr. Pawelek will become the sole director of our company. For biographical and other information concerning the Principals, see “New Director and Executive Officer Appointees.”

The Sonterra Financing

On May 30, 2007, we entered into an engagement letter with Viking and the Principals, pursuant to which Viking or one of its affiliated funds and/or other unaffiliated investors would provide equity and debt financing to us to fund the acquisitions of certain assets from Cinco and Flash, namely, the Sonterra Acquisitions, and additional working capital for operations and growth thereafter. Viking is the investment advisor to Longview, and the general partner of Longview is an affiliate of Viking. The engagement letter proposed our issuance of an aggregate of $6,000,000 of our common stock in a private placement exempt from registration under the Securities Act of 1933, as amended, to Longview and possibly other investors. Longview and the other investors would have acquired a number of shares of our common stock constituting approximately 85% of our outstanding common stock upon completion of proposed transaction. The engagement letter also provided for our sale to Longview of senior secured notes in an aggregate principal amount up to $10,000,000, in tranches of $2,000,000 each, which would be secured by a blanket first-priority security interest on all our assets (including assets to be acquired in the Sonterra Acquisitions) and would mature three years from the closing date of the proposed financings. In addition, Longview would receive warrants to purchase shares of our common stock at an aggregate exercise price of $1,500,000. The engagement letter also provided that we would adopt a stock option plan and that upon consummation of the Sonterra Acquisitions, the Principals would receive options under this new option plan to purchase 20% of our common stock.

In order to effect the transactions contemplated by the engagement letter, we considered the possibility of effecting a reverse stock split of our common stock to reduce the issued and outstanding shares of our common stock and thereby make available a sufficient number of shares of our authorized but unissued common stock for issuance to Longview in the equity financing under the engagement letter, for warrants to be issued in the debt financing and for options to be issued to the Principals under the new option plan. In order to effect the reverse stock split as expeditiously as possible and thereby facilitate the equity and debt financing for the Sonterra Acquisitions as originally contemplated by the engagement letter with Viking, it was proposed that the reverse stock split and related amendments to our certificate of incorporation be approved by consent of Majority Stockholders in lieu of convening a stockholders meeting for which proxies would be solicited. In such cases, the Exchange Act and the rules of the SEC require dissemination of an Information Statement relating to the actions to be taken by stockholder consent at least 20 days before the action is taken. However, it became apparent that the time required for preparation, filing and distribution of the Information Statement (including the time required for likely SEC review) would preclude us from consummating the financing with Viking or others under the engagement letter within a time frame that would meet the timing requirements of the sellers in the Sonterra Acquisitions. Accordingly, to provide for timely availability of financing for the Sonterra Acquisitions, after further discussions and negotiations among Viking, the Principals and us, it was determined that we would make the Sonterra Acquisitions in a series of steps pursuant to which (i) Sonterra would enter into definitive agreements for the Sonterra Acquisitions, (ii) Sonterra would complete the acquisitions with equity and debt financing from Longview, following which (iii) we would acquire the equity and debt securities of Sonterra from Longview in exchange for our equity and debt securities in amounts and having terms substantially identical to the securities contemplated in the engagement letter, as a result of which Sonterra would become our wholly-owned subsidiary.

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On July 9, 2007, Sonterra entered into a purchase and sale agreement with Cinco for the acquisition of certain oil and gas interests in Calhoun and Matagorda Counties, Texas (the “Cinco Acquisition”). Also on July 9, 2007, Longview entered into the original securities purchase agreement with Sonterra, pursuant to which Longview purchased shares of Sonterra Common Stock for a purchase price of $9,990 and advanced $322,500 to Sonterra, evidenced by a senior secured note of Sonterra (the “Deposit Note”). On August 3, 2007, in connection with the closing of the Cinco Acquisition, Sonterra and Longview executed the Sonterra SPA, and Longview advanced $5,990,010 to Sonterra (of which $322,500 refinanced the Deposit Note) evidenced by the Sonterra Equity Note issued to Longview and Sonterra issued the Sonterra Warrant to Longview. Subject to certain conditions in the Sonterra SPA, Longview also agreed to purchase an additional promissory note of Sonterra in the principal amount of up to $2,000,000 to finance the purchase of oil and gas properties from Flash. Contemporaneously with the amendment and restatement of the Sonterra SPA on August 3, 2007, Sonterra closed the Cinco Acquisition and also entered into a purchase and sale agreement with Flash for the purchase of the remaining properties constituting the Sonterra Acquisitions (the “Flash Acquisition”). Sonterra closed the Flash Acquisition on August 29, 2007 with funds provided by Longview and issued the Sonterra Non-Equity Note to Longview on that date.

The investments by Longview provided substantially all the funds necessary to enable Sonterra to consummate the Sonterra Acquisitions and pay the fees and expenses incurred by Sonterra in connection with the Sonterra Acquisitions. Subsequent to consummation of the Sonterra Acquisitions and the investments by Longview, the shares of Sonterra Common Stock acquired by Longview, the Sonterra Equity Note, the Sonterra Warrant and the Sonterra Non-Equity Note constitute all of the outstanding equity and debt securities of Sonterra, which owns and operates all the assets acquired in the Sonterra Acquisitions.

As a condition to the original investments by Longview in Sonterra, on July 9, 2007, we entered into a letter of intent with Longview, Sonterra and the Principals which contemplated that we would effect a securities exchange with Longview to acquire all of the outstanding equity and debt securities of Sonterra and that we would also guaranty the obligations of Sonterra under the Sonterra SPA. On August 3, 2007, contemporaneously with Sonterra’s closing of Cinco Acquisition and Sonterra’s execution of the purchase and sale agreement with Flash, we entered into the Securities Exchange Agreement with Longview contemplated by the letter of intent.

The Securities Exchange Agreement

The summary of the material terms of the Securities Exchange Agreement below and elsewhere in this Information Statement is qualified in its entirety by reference to the Securities Exchange Agreement, a copy of which is attached to this Information Statement as Annex A and which we incorporate by reference into this document. This summary may not contain all of the information about the Securities Exchange Agreement that is important to you. We encourage you to read carefully the Securities Exchange Agreement in its entirety. The Securities Exchange Agreement has been included to provide you with information regarding its terms. The Securities Exchange Agreement contains representations and warranties that the parties to the Securities Exchange Agreement made to and solely for the benefit of each other, and the assertions embodied in such representations and warranties are qualified by information contained in additional disclosures made in the schedules delivered in connection with signing the Securities Exchange Agreement, which have also been filed with the SEC. These representations and warranties may have been made for the purposes of allocating contractual risk between the parties to the Securities Exchange Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Accordingly, you should not rely on such representations and warranties as characterizations of the actual state of facts or circumstances, since they were only made as of the date of the Securities Exchange Agreement and are modified in important part by the underlying disclosures.

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Terms of the Securities Exchange

Pursuant to the Securities Exchange Agreement, Longview has agreed to exchange all its shares of Sonterra Common Stock, the Sonterra Equity Note and the Sonterra Warrant for 218,465,578 shares of our common stock and a warrant to purchase 49,586,777 shares of our common stock (the “Warrant”). The number of shares of our common stock that we will issue to Longview and the number of shares that will be issuable upon exercise of the Warrant will each be adjusted to give effect to the reverse stock split described below in this Information Statement. In accordance with our July 9, 2007 letter of intent with Longview, the number of shares of our common stock that we will issue to Longview will equal 85% of our outstanding common stock after giving effect to the issuance of such shares. The deemed issue price per share of our common stock will be the quotient of $6,000,000 divided by the number of shares we issue. The Warrant will have a term of 5 years with an exercise price per share equal to 110% of the deemed issue price to and will be exercisable into a number of shares of our common stock equal to the quotient of $1,500,000 divided by the exercise price. We will be obligated to file a registration statement covering the shares of common stock underlying the Warrants and Longview will receive demand and piggyback registration rights for the shares of our common stock that it will receive in the Securities Exchange.

Longview has also agreed to exchange the Sonterra Non-Equity Note for the Initial Note in an equal principal amount. Subject to various conditions set forth in the Securities Exchange Agreement, we will also have the right in our discretion on a quarterly basis to require Longview to purchase Additional Notes in a principal amount of up to $2,000,000 per fiscal quarter, up to an aggregate amount which, when added to the initial principal amount of the Initial Note, may not exceed $10,000,000. The Notes will be secured by a first-priority blanket lien on all our assets (other than the shares of the Insurance Subsidiaries) and the assets of our subsidiaries, other than those of the Insurance Subsidiaries.

Immediately, prior to consummation of the Securities Exchange, we will effect the reverse stock split. See “Reverse Stock Split at Ratio of At Least 1-for-5 and up to 1-for-20” below.

Representations and Warranties

We make customary representations and warranties in the Securities Exchange Agreement that are subject, in some cases, to specified exceptions and qualifications. Our representations and warranties relate to, among other things:

•

our corporate organization existence and good standing;

•

our corporate authorization of the Securities Exchange and related transactions and non-contravention of law;

•

the enforceability and validity of our agreements, validity, enforceability, perfection and priority of all security interests and liens to be granted to Longview;

•

our capital structure and outstanding indebtedness;

•

authorization of the securities to be issued to Longview;

•

our title to our properties and the absence of encumbrances on our properties;

•

our compliance with laws and regulations, including environmental laws;

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• the absence of material litigation involving us or our properties;

•

corporate existence of our subsidiaries;

•

adequacy of our internal accounting controls, disclosure controls and books and records;

•

our payment of taxes;

•

the adequacy of our insurance;

•

our full disclosure to Longview, including the accuracy of our SEC filing and financial statements; and

•

the accuracy of the information provided to Longview.

Longview also makes certain representations and warranties in the Securities Exchange Agreement relating principally to its authorization of the Securities Exchange and related transactions, its status as an “accredited investor” under the Securities Act, and certain other matters required in connection with the issuance of our common stock, the Warrant and the Notes to Longview without registration under the Securities Act.

Covenants

The Securities Exchange Agreement imposes covenants on our operations as long as the Notes are outstanding. These covenants include, among other things:

Affirmative Covenants

The Securities Exchange Agreement requires that we and our subsidiaries:

•

maintain our corporate existence and public company status;

•

maintain our properties and conduct our operations as presently conducted;

•

maintain adequate insurance;

•

comply with laws, including public company filing obligations;

•

provide Longview with periodic financial information, including information relating to our compliance with the financial covenants in the Notes;

•

take steps to assure that information that we provide to Longview does not contain material non-public information;

•

maintain quotations for our common stock on the Over-The-Counter Bulletin Board (the “OTC Bulletin Board”), or the listing of our common stock on any stock exchange on which we subsequently list our common stock;

•

provide additional collateral, title information and additional guarantors when required and comply with our obligations under the agreements creating the security interests;

•

reimburse Longview for its expenses incurred in connection with the Securities Exchange Agreement, the related transaction documents and consummation of the transactions contemplated by those documents;

•

use the proceeds of any Additional Notes only to pay the expense of issuance of such Notes and working capital; and

•

divest our interest in the Insurance Subsidiaries in an arm’s length transaction.

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Negative Covenants

Under the Securities Purchase Agreement, neither we nor our subsidiaries may, among other things:

•

incur indebtedness or liens, other than permitted subordinated debt and permitted liens or enter into negative pledge agreements;

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pay any dividend or distributions on, or repurchase or redeem, our common stock;

•

prepay our subordinated debt;

•

sell, transfer, farm-out, assign or dispose of sell our real property or any collateral associated with the operation of our real property, subject to specified exceptions requiring, among other conditions, that Longview obtain a lien on the cash or other proceeds of the disposition;

•

sell or discount our receivables, except that, after the closing of the Securities Exchange, we may discount our receivables on an arm’s length basis and provide early payment discounts in the ordinary course of business;

•

dispose of or farm out any of the collateral in which Longview has a mortgage or security interest other than in arm’s length transactions in which the proceeds are deposited into an account in which Longview has a security interest and in compliance with the financial covenants in the Notes;

•

establish subsidiaries or make investments loans or advances to any person, subject to specified exceptions requiring that the shares of such subsidiaries and such investments be pledged to Longview; or

•

merge or consolidate with, or sell all or substantially all our assets to, any other person, subject to specified exceptions.

The covenants limiting our ability to sell our properties, engage in merger or consolidations and sell assets do not apply to our sale of the Insurance Subsidiaries, a sale of such Insurance Subsidiaries’ assets, or mergers or consolidations of such Insurance Subsidiaries, in each case pursuant to a transaction in which we dispose our entire interest in the Insurance Subsidiaries.

Post-closing Covenants

The Share Exchange Agreement also requires that we:

•

divest the Insurance Subsidiaries as soon as reasonably practicable after the consummation of the Securities Exchange; and

•

file a Form 8-K with the SEC reporting the Securities Exchange containing audited financial information and the information required by Form 10-SB within 4 business days after the closing of the Securities Exchange.

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Conditions to the Securities Exchange Agreement

Consummation of the Securities Exchange is subject to certain conditions set forth in the Securities Exchange Agreement, including the continued accuracy of Sonterra’s representations and warranties in the Sonterra SPA and its performance of its obligations thereunder, the continued accuracy of our and Longview’s representations and warranties in the Securities Exchange Agreement and our and Longview’s performance of our respective obligations thereunder, approval of the reverse stock split by the Majority Stockholders (which has occurred), the filing of the Certificate Amendment to our Certificate of Incorporation (which is expected to occur immediately prior to the closing of the Securities Exchange), the adoption of the 2007 Plan and distribution of this Information Statement to our stockholders.

Participation Rights

From the date of the closing of the Securities Exchange until the later of the second anniversary of the Securities Exchange and 60 days after no Notes remain outstanding, Longview will have the right to purchase up to 50% of all debt, equity and/or equity-linked financings of our Company, subject to certain conditions set forth in the Securities Exchange Agreement, subject to certain customary exceptions.

Additional Notes

Longview’s obligation to purchase Additional Notes is subject to certain conditions set forth in the Securities Exchange Agreement, including the continued truth and accuracy of our representations and warranties in the Securities Exchange Agreement as of the time they were made and as of the date of issuance of the Additional Notes (except for representations and warranties that speak as of a specific date, which must be true and correct as of such date), subject to permitted updates, and our performance of all of our obligations and covenants under the Securities Exchange Agreement, the Notes and the other agreements entered into in connection with the Securities Exchange. In addition, we will pay Longview a transaction fee equal to 1% of the principal amount of the Additional Notes being purchased and reimburse Longview for its expenses incurred in connection with the purchase.

Termination

If the Securities Exchange is not consummated on or before the third business day following the earlier of December 31, 2007 and the 20^th day after the mailing of this Information Statement due to our or Longview’s failure to satisfy the conditions precedent to be satisfied by us or Longview, the non-breaching party shall have the right to terminate the Securities Exchange Agreement. If the Securities Exchange Agreement is terminated under this provision, provided that Longview is not the breaching party under the Securities Exchange Agreement, we will be obligated to pay Longview’s legal, due diligence and other expenses incurred in connection with the Securities Exchange Agreement.

Registration Rights

At the closing of the Securities Exchange, we and Longview will enter into a registration rights agreement which will require that we file within 30 days of the Securities Exchange a registration statement to register the shares of common stock underlying the warrant. The registration statement would be required to become effective within 120 days of the Securities Exchange.

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Longview will also have piggyback and demand registration rights with respect to the shares of common stock acquired in the Securities Exchange, the common stock owned by Longview prior to the exchange, and the shares underlying the Warrant. The deadlines for filing and effectiveness of registration statements may be extended, and the number of shares required to be registered may be adjusted, in each case under certain circumstances specified in the Registration Rights Agreement. The Registration Rights Agreement and the Securities Exchange Agreement also impose limitations on our filing other registration statements, subject to certain exceptions, including registration statements for securities to be offered in connection with acquisitions and employee benefit plans.

Our Directors and Officers

Under the Securities Exchange Agreement, we have agreed to enter into employment agreements with each of Michael Pawelek, Wayne Psencik and Sherry Spurlock, each of whom is currently an executive officer of Sonterra, pursuant to which they will serve as our Chief Executive Officer, Vice President-Operations and Chief Financial Officer, respectively. In addition, it is expected that contemporaneously with the closing under the Securities Exchange Agreement, our current directors, Howard Taylor and William Dickie will submit their resignations as directors and/or officers of our company, that Mr. Richard Freer, our Secretary, will resign and that Mr. Pawelek will be appointed to our board and will be our sole director immediately following the closing of the Securities Exchange. For biographical and other information regarding the Principals, see “New Director and Executive Officer Appointees” below. We will also adopt the 2007 Plan, effective upon completion of the Securities Exchange, and we will issue options to the Principals for an aggregate number of shares equal to 20% of the number of shares outstanding after the consummation of the Securities Exchange. See “--The 2007 Non-Qualified Stock Option Plan” below.

Other Provisions

For information regarding certain other provisions of the Securities Exchange Agreement relating to compensation payable to Viking and certain other rights of Longview under the Securities Exchange Agreement, see “Interests of Certain Persons in the Reverse Stock Split and the Securities Exchange.”

Additional Terms under the Notes

The summary of the additional terms of the Notes below and elsewhere in this Information Statement is qualified in its entirety by reference to the Notes.

Financial Covenants:

The Notes will require that we comply with certain financial covenants, as follows:

Quarterly Revenue: From September 30, 2007 to June 30, 2008, our trailing 3 month quarterly revenue from all sales of hydrocarbons, and related services must be at least $300,000, and then at least $500,000 at all times thereafter until maturity. If we fall out of compliance with this covenant, we would be required to repay an amount of principal of the then outstanding Notes equivalent to the percentage shortfall of our non-compliance with this covenant.

BCFE: From the oil and gas properties that are subject to the first priority lien granted to Longview, we must maintain total proved reserves measured by billion cubic feet equivalent (BCFE) at the end of each quarterly period set forth below at or above the number set forth opposite such period. For purposes of this calculation, no more than 40% of our total reserves may consist of proved undeveloped reserves.

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Period Ending		BCFE
Closing of the Securities Exchange		2.0
Sept 30, 2007		2.0
Dec 31, 2007		4.0
March 31, 2008		5.0
June 30, 2008 to Maturity		7.0

This covenant is measured quarterly, and if our reserves fall short of the required BCFE amounts as of the applicable measurement date, we would be required to repay an amount of principal of the then outstanding Notes equivalent to the percentage shortfall of our non-compliance with this covenant. Sonterra is subject to the same covenant during the period prior to the closing of the Securities Exchange and was in compliance with the covenant at September 30, 2007.

Proved Reserve Value Ratio: From the oil and gas properties that are subject to the first priority lien granted to Longview, we must maintain a ratio of proved reserve value to the debt outstanding under the Notes determined in accordance with a formula contained in the Notes. This covenant is measured quarterly and if we fail to meet the required ratio at the end of any quarter, we would be required on a quarterly basis to repay an amount of principal of the then outstanding Notes necessary to remain in compliance with the ratio requirements.

Interest; Prepayment

The Notes will bear interest of a rate per annum equal to the 3-month LIBOR rate as in effect from time to time plus 8.25% and will mature on August 31, 2010. We will have the right to prepay the Notes, in whole or in part, at any time at a price equal to the principal amount being prepaid plus accrued interest to the prepayment date plus a premium initially equal to 3% of the amount being prepaid. The prepayment premium will be reduced by 1% per annum until the maturity date of the Notes. In connection with prepayment upon certain changes in control and prepayment upon occurrence of certain events of default, the prepayment premium will instead equal 20% of the principal amount prepaid or required to be prepaid.

Collateral

The Sonterra Non-Equity Note is secured by a security interest in all of the assets of Sonterra, including a mortgage of the oil and gas interests acquired in the Sonterra Acquisitions. The Notes will be secured by a first-priority blanket lien on all of our assets and those of our subsidiaries, including Sonterra, and by a pledge of the shares of all of our subsidiaries after the closing of the Securities Exchange, including Sonterra, but excluding the Insurance Subsidiaries and the assets of the Insurance Subsidiaries. To grant this lien, at the closing of the Securities Exchange, we will execute a joinder agreement pursuant to which we will become a party to the existing security agreement, as amended, between Viking, as collateral agent (the “Collateral Agent”), and Sonterra. We will also enter into a Pledge Agreement with the Collateral Agent, pursuant to which we will pledge the Sonterra Common Stock and the shares of any other subsidiaries (excluding the Insurance Subsidiaries) and we will pledge our U.S. bank accounts to the Collateral Agent pursuant to one or more Deposit Account Control Agreements to be entered into among Sonterra, ourselves, the Collateral Agent and the depositary banks. In addition, we will guaranty all of Sonterra’s obligations to Longview and Sonterra will guaranty all of our obligations to Longview.

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Event of Default

The occurrence of each of the following events will be an event of default under the Notes:

•

our default in payment of any principal, required prepayment amount, or amount payable due to our failure to satisfy certain financial covenant tests under the Notes when and as due;

•

our default in payment of any interest or other amount due on the Notes (other than as set forth in the preceding bullet) that is not cured within three business days from the date the amount is due;

• our failure for 10 days to comply with any other provision of the Notes in all material respects;

•

our default in payment of any indebtedness for borrowed money in the principal amount of $100,000 or more (individually or in the aggregate), or the occurrence of any event or circumstance permitting the holder of any such indebtedness to accelerate its maturity or otherwise require prepayment or enforce any security for any such indebtedness;

•

we or our subsidiaries commence proceedings, or any proceedings are commenced against us or our subsidiaries, under any bankruptcy law;

•

we or any of our subsidiaries breach any covenant or other term or condition of the documents granting the security interests securing the Notes;

•

we or any of our subsidiaries breach any covenant or other term or condition of the Securities Exchange Agreement, the Warrant, the Notes or any other transaction document;

•

we breach, or otherwise do not comply with, certain additional security covenants or any of the negative covenants of the Securities Exchange Agreement;

•

one or more judgments, non-interlocutory orders or decrees are entered against us or any of our subsidiaries involving an aggregate liability of $100,000 and remain unsatisfied or not stayed, bonded or vacated for a period of 30 days after the entry;

• a change of control (as defined in the Notes) occurs;

•

any representation, warranty and any other statement made by us or any of our subsidiaries in the Securities Exchange Agreement, any other transaction document or the documents concerning the security interests is incorrect in any material respect;

•

any lien created in the Securities Exchange fails to be a valid and perfected lien on the collateral purported to be secured, subject to certain exceptions;

•

we fail to file in a timely manner any periodic report or current report required under the Exchange Act, or certain information in any such report relating to our revenue, proved oil and gas reserves or financial covenant compliance is not true and correct in all material respects; or

•

we fail to deliver any officer’s certificate relating to the accuracy of the oil and gas reserve information and financial covenant compliance information set forth in our periodic reports filed with the SEC, or any of the information contained in any such officer’s certificate delivered is not true, correct and complete in all material respects.

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Remedies upon Default

Upon the occurrence and continuation of an event of default under the Notes, the holder of the Notes may declare all or any portion of the Notes to be due and payable immediately, except that upon the occurrence of certain bankruptcy-related events of default, amounts due thereunder become due and payable immediately, without further action or notice on the part of the holder. In addition to any other remedy available to the holder under the Notes or under the security interests held by the Collateral Agent, after an event of default unpaid amounts bear interest at a rate 2% in excess of the stated interest rate on the Notes, and any payment of principal made prior to the scheduled maturity date of the Notes must be accompanied by the applicable prepayment premium (see “Interest; Prepayment,” above). In addition, upon an event of default, the Collateral Agent shall be entitled to exercise its rights and remedies with respect to the collateral, including, without limitation, the rights of a secured party under the Uniform Commercial Code and its foreclosure rights under the mortgage on Sonterra’s oil and gas interests.

Regulatory Approval

No approval from any local or federal government authorities is required for the Securities Exchange.

Effect on Control and Management

Longview is presently the beneficial owner of approximately 57.8% of our common stock and LFI, an affiliate of Longview, for which Viking exercises investment authority, beneficially owns an additional 8.8% of our common stock. Accordingly, Viking currently beneficially owns 66.6% of our common stock. After giving effect to the reverse stock split and consummation of the Securities Exchange described in this Information Statement, Longview will be the beneficial owner of approximately 93.7% of our common stock. Consummation of the Securities Exchange will therefore increase Longview’s controlling interest in us and will similarly increase Viking’s beneficial ownership of our common stock.

In addition, pursuant to the terms and conditions of the employment agreements required by the Securities Exchange Agreement, each of Messrs. Pawelek and Psencik and Ms. Spurlock will become executive officers and Mr. Pawelek will become a director of our company at the closing of the Securities Exchange and our current directors, Howard Taylor and William Dickie are expected to submit their resignation as our directors and officers and that Mr. Richard Freer is expected to submit his resignation as Secretary. As a result thereof, immediately after the closing of the Securities Exchange and upon such resignation, Mr. Pawelek will be our sole director. For biographical and other information regarding the Principals, see “New Director and Executive Officer Appointees.”

REVERSE STOCK SPLIT AT A RATIO OF AT LEAST 1-FOR-5 AND UP TO 1-FOR-20

Purpose of the Reverse Stock Split

The Securities Exchange Agreement requires that we issue 218,465,578 shares of common stock in the Securities Exchange, the Warrant to purchase 49,586,777 shares and options to purchase 51,403,665 shares, in each case subject to adjustment for the reverse stock split. The additional common

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stock to be issued to Longview in the Securities Exchange and reserved for issuance upon exercise of the Warrant and of options granted under the option plan would require the issuance of substantially more shares of our common stock than our authorized capital stock of 50,000,000 shares set forth in our Certificate of Incorporation. Because we currently do not have sufficient authorized shares to consummate the Securities Exchange or to reserve shares of common stock for issuance upon exercise of the Warrant or options, our Board of Directors and the Majority Stockholders have approved the reverse stock split to enable us to issue and reserve a sufficient number of shares for such purposes.

The Securities Exchange will result in our becoming engaged in the oil and gas business and ceasing to being a shell company under the SEC’s rules.

Potential Effects of the Reverse Stock Split on the Market for Our Common Stock

The Board of Directors believes that the reverse stock split could better enable us to move toward an eventual listing of our stock on a national securities exchange. Our common stock is currently quoted on the OTC Bulletin Board. The Board of Directors believes that it is in our best interests and our stockholders’ best interest to take steps to move toward listing our common stock on a national securities exchange. Alternative markets like the OTC Bulletin Board or the “pink sheets” maintained by the National Quotation Bureau, Inc., are generally considered to be less efficient and not as widely followed as other exchanges like those operated by the NASDAQ Stock Market, Inc. (“NASDAQ”) or the American Stock Exchange.

In order for us to list our common stock on NASDAQ or the American Stock Exchange, we must satisfy certain listing standards, some of which standards require a minimum bid price. For example, certain listing standards of the NASDAQ Capital Market (the lowest listing tier of NASDAQ) would require that our common stock have a minimum bid price of at least $4.00 per share. In addition, certain of the listing standards of the American Stock Exchange would require that our common stock have a minimum bid price of at least $3.00 per share. As of November 27, 2007, the closing price bid for our Common Stock as reported on the OTC Bulletin Board was $0.33 per share.

The Board of Directors believes that the reverse stock split of our common stock could help us move toward satisfying the minimum bid price listing standards of a national securities exchange like NASDAQ or the American Stock Exchange. However, the effect of the reverse stock split upon the market price of our common stock cannot be predicted with any certainty, and the history of similar reverse stock splits for companies in like circumstances is varied. It is possible that the per share price of our common stock after the reverse split will not rise in proportion to the reduction in the number of shares of our common stock outstanding resulting from the reverse stock split, and there can be no assurance that the market price per share after the reverse stock split will remain at such higher level for a sustained period of time. The market price of our common stock will also be affected by other factors unrelated to the number of shares outstanding, particularly the value attributed to our oil and gas business and our future performance. Viking’s beneficial ownership of approximately 93.7% (95.8% with its affiliate, LFI) of our common stock after the Securities Exchange will prevent a takeover bid or other acquisition of our company without Longview’s consent, which could adversely affect the market price for our common stock. Moreover, the “overhang” created by the large number of shares to be issued to Longview, the additional shares issuable upon exercise of the Warrant and the options to be issued to the Principals and Longview’s registration rights are also likely to adversely affect the market price of our common stock. In addition, our ability to list our stock on a national securities exchange is subject to numerous requirements other than a minimum share price, including income and market capitalization requirements and corporate governance requirements, such as the formation of an audit committee meeting certain requirements for the independence of its members. Accordingly, even if our share price were to rise as a result of the reverse stock split, we cannot guarantee that we would be able to list our stock on a national securities exchange.

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The Board of Directors also believes that the reverse stock split could improve the marketability and liquidity of our common stock while we continue to progress towards achieving our business objectives. Trading in our securities is subject to the “penny stock” rules of the SEC. The SEC has adopted regulations that generally define a penny stock to be any unlisted equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require that any broker-dealer who recommends our securities to persons other than prior customers and accredited investors must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our securities. In addition to the “penny stock rules” imposed by the SEC, many brokerage houses and institutional investors have internal policies and practices that either prohibit them from investing in low-priced stocks or tend to discourage individual brokers from recommending low-priced stocks to their customers due to the trading volatility often associated with low-priced stocks. Some of those policies and practices may function to make the processing of trades in low-priced stocks economically unattractive to brokers. Additionally, because brokers’ commissions on low-priced stocks generally represent a higher percentage of the stock price than commissions on higher-priced stocks, the current average price per share of our common stock can result in individual stockholders paying transaction costs representing a higher percentage of their total share value than would be the case if the share price were substantially higher. There is no assurance that we will not continue to be subject to the “penny stock rules” after the reverse split.

There can, however, be no assurance that either or both of the reverse split and a possible exchange listing will increase the liquidity of the market for our common stock. In particular, based on 38,552,749 outstanding shares of common stock, the reverse split will reduce the number of publicly held shares of our common stock (i.e., the holdings of persons other than our officers, directors, and significant stockholders) to approximately 964,214 shares (if effected on a 1-for-8 basis) or approximately 385,686 shares (if effected on a 1-for-20 basis). The relatively small number of shares in the public float is likely to materially and adversely affect the liquidity of our common stock following the reverse split. In addition, we anticipate that as a result of the reverse split, the holdings of many of our stockholders will be reduced to less than a “round lot” (100 shares). Such holders could find it difficult to sell such “odd lots” and are likely to incur increased transaction costs should they seek to do so.

Control by Viking

Immediately following the Securities Exchange, Longview is expected to hold 93.7% of our issued and outstanding common stock and will effectively control our company, and LFI will own an additional 1.3% of our common stock. Viking, through its power to make all investment decisions for Longview and LFI, will possess the ability, through exercise of Longview’s and LFI’s voting power and their power to elect all of our directors (including any directors who are required to be “independent” under the rules of any stock exchange on which we may list our common stock) to dictate the actions of our company, to approve any action requiring stockholder approval (or reject any such action with which it disagrees), including acquisitions and unsolicited takeover proposals, and to delay, defer or prevent a change of control of our company which stockholders might otherwise view favorably. Under the DGCL, a holder of 90% of the voting stock of a company has the right to effect a “short-form” merger with such company without the vote or consent of the minority stockholders.

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Effectiveness of the Reverse Stock Split

The reverse stock split is expected to become effective upon filing of the Certificate Amendment with the office of the Secretary of the State of the State of Delaware (which will not occur until at least twenty (20) days following the mailing of this Information Statement), or such later date as is specified in the Certificate Amendment (in either case, the “Effective Date”). The reverse stock split will take place on the Effective Date without any action on the part of the holders of the pre-split common stock.

Certificates and Fractional Shares; Round Lots

After the Effective Date, each certificate representing shares of our outstanding common stock will automatically represent a number of shares of post-split common stock into which the shares of pre-split common stock have been converted as a result of the reverse stock split. New stock certificates will not be issued at this time, and it will not be necessary for stockholders of the Company to exchange their existing stock certificates. Certificates evidencing post-split shares of our common stock issued after the reverse split will carry a different CUSIP number from the number currently set forth on our share certificates. No fractional shares of post-split common stock will be issued. If the reverse stock split would result in a fraction of a share, then we will round up all such fractions of a share held by a single stockholder to a full share, and the holder shall be entitled to receive a whole share in lieu of such fraction or fractions.

In any transaction in which old certificates that contain a restrictive legend are surrendered and replaced by new certificates representing post-split common stock, the new certificates will be issued with the same restrictive legend. As applicable, the time period during which a stockholder has held our outstanding common stock will be included in the time period during which such stockholder actually holds the post-split common stock received in exchange for such outstanding common stock for the purposes of determining the term of the restrictive period applicable to the post-split common stock.

Impact of the Reverse Stock Split

The principal effect of the reverse stock split will be to decrease the number of shares of common stock outstanding in proportion to the ratio used to affect the reverse stock split. For example, based on approximately 38,552,749 shares outstanding, our outstanding shares would be reduced to approximately 4,819,094 shares, assuming an exchange ratio of 1-for-8, or approximately 1,927,638 shares, assuming an exchange ratio of 1-for-20. The reverse stock split could also increase the price of our common stock and improve the marketability and liquidity of our common stock, but there can be no assurance that it will have these effects. For more information, see “Potential Effects of the Reverse Stock Split on the Market for our Common Stock” above.

The following table shows our outstanding capitalization (shares issued and outstanding, shares reserved for issuance pursuant to convertible securities, warrants and options, and authorized but unreserved shares) following the reverse stock split and the Securities Exchange, based on an assumed reverse stock split ratio of 1-for-8, 1-for-12 and 1-for-20. In all cases, after consummation of the reverse split and the Securities Exchange, our authorized capitalization will continue to be 50,000,000 shares of common stock.

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		Reserved for issuance pursuant to convertible securities, warrants and options

Assumed Reverse Split Ratio			Authorized but unissued and unreserved
Assumed Reverse Split Ratio	Issued and Outstanding		Authorized but unissued and unreserved
1-for-8	32,127,291	12,623,805	5,248,904
1-for-12	21,418,194	8,415,870	20,165,936
1-for-20	12,850,916	5,049,522	32,099,562

The shares of post-split common stock will be fully paid and non-assessable. The Certificate Amendment relating to the reverse stock split will not change the terms of our common stock. The shares of the post-split common stock will have the same voting rights and rights to dividends and distributions and will be identical in all other respects to the pre-split common stock now authorized and held by our stockholders. The reverse stock split will not alter an existing stockholder’s percentage ownership of common stock. However, the purpose of the reverse stock split is to enable and facilitate the Securities Exchange, which will result in immediate and substantial dilution of each existing stockholder’s percentage ownership other than Longview.

The reduction in the number of outstanding shares will affect the presentation of stockholders’ equity in our balance sheet. Because the par value of the shares of our common stock is not changing as a result of the reverse stock split, our stated capital, which consists of the par value per share of our common stock multiplied by the aggregate number of shares of our common stock issued and outstanding, will be reduced proportionately on the effective date of the reverse stock split. Correspondingly, our additional paid-in capital, which consists of the difference between our stated capital and the aggregate amount paid to us upon the issuance of all currently outstanding shares of our common stock, will be increased by a number equal to the decrease in stated capital. However, as a result of the Securities Exchange, there will be additional paid-in capital from the investors, including Longview.

The reverse stock split is not intended as, and will not have the effect of, a “going private” transaction. We do not presently intend to de-register our common stock or to cease filing Exchange Act reports and we have agreed to continue to file Exchange Act reports under the Securities Exchange Agreement. In addition, because all shareholdings will be rounded up to the nearest whole share after giving effect to the reverse stock split, the number of holders of our common stock will not be reduced by the reverse stock split. We will therefore continue to be subject to the periodic reporting requirements of the Exchange Act.

Federal Income Tax Consequences

The following summary of material U.S. federal income tax consequences of the reverse stock split does not purport to be a complete discussion of all of the possible federal income tax consequences. Further, it does not address any state, local, foreign or other income tax consequences, nor does it address the tax consequences to stockholders that are subject to special tax rules, such as stockholders subject to the alternative minimum tax, banks, insurance companies, regulated investment companies, personal holding companies, foreign entities, nonresident alien individuals, certain U.S. expatriates, broker-dealers, tax-exempt entities, retirement plans, pass-through entities (including partnerships and entities and arrangements classified as partnerships for U.S. federal income tax purposes) and beneficial owners of such pass-through entities.

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The discussion is based on the United States federal income tax laws as of the date of this Information Statement. Such laws are subject to change retroactively, as well as prospectively. This summary also assumes that the shares of common stock are held as “capital assets,” as defined in the Internal Revenue Code of 1986, as amended (generally, property held for investment). The tax treatment of a stockholder may vary depending on the facts and circumstances of such stockholder.

Each stockholder is urged to consult with such stockholder’s tax advisor with respect to the particular tax consequences of our reverse stock split.

No gain or loss will be recognized by a stockholder as a result of the reverse stock split. The aggregate tax basis of the shares received in the reverse stock split will be the same as the stockholder’s aggregate tax basis in the shares surrendered as a result of the reverse stock split. The stockholder’s holding period for the shares received in the reverse stock split will include the period during which the stockholder held the shares surrendered as a result of the reverse stock split.

We have not sought any ruling from the Internal Revenue Service or an opinion of counsel with respect to the statements made and the conclusions reached in this summary. Our views regarding the tax consequences of the reverse stock split are not binding upon the Internal Revenue Service or the courts, and there is no assurance that the Internal Revenue Service or the courts would accept the positions expressed above. The state and local tax consequences of the reverse stock split may vary significantly as to each stockholder, depending on the state in which such stockholder resides.

OUR NAME CHANGE

Under our Certificate of Incorporation, as presently in effect, our name is “River Capital Group, Inc.” Our Board of Directors unanimously approved and declared advisable a change of the name of our company from “River Capital Group, Inc.” to “Sonterra Resources, Inc.” Stockholder approval for the Certificate Amendment changing our name was obtained by written consent of the Majority Stockholders. The Certificate Amendment effecting the name change will become effective following filing with the Secretary of the State of the State of Delaware, which will not occur earlier than the 20th day after the mailing of this Information Statement to our stockholders as of the Record Date. A copy of the Certificate Amendment is attached to this Information Statement as Annex B.

Purposes of the Name Change

The assets we will acquire in the Securities Exchange consist primarily of a pipeline, leasehold interests, working interests and revenue interests in certain real properties and related projects related to the extraction and processing of oil, gas or other mineral resources. Upon the acquisition of such properties and assets, our business will change to exploration for and production of oil and gas. In connection with such acquisitions to be funded by the Securities Exchange, the Board of Directors has determined that the change of our name to “Sonterra Resources, Inc.”, the current full name of Sonterra, is in the best interest of our stockholders. Sonterra will become our wholly owned subsidiary and will change its name to a name other than “Sonterra Resources, Inc.”

THE 2007 NON-QUALIFIED STOCK OPTION PLAN

The requisite stockholders approval of the 2007 Plan was obtained on November ___, 2007 in order for the 2007 Plan to be qualified for the exemptions under Section 162(m) of the Code.

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Purpose of the 2007 Plan

It is a condition under the Securities Exchange Agreement that a new management stock option plan be established upon consummation of the Securities Exchange. Pursuant to the 2007 Plan, we will grant options to Messrs. Pawelek and Psencik and Ms. Spurlock to purchase a total of 51,403,665 shares of common stock, subject to adjustment to reflect the reverse stock split. The purpose of the 2007 Plan is to advance our interests by encouraging and providing for the acquisition of an equity interest in us by the Principals through the grant of options to purchase our common stock. The 2007 Plan will enable us to retain the best services of the Principals by aligning their interest with our interests.

Eligible Participants under the 2007 Plan

The 2007 Plan provides generally for the grant of options to purchase our common stock to our directors, executive officers and employees. However, no further options under the 2007 Plan will be granted subsequent to the grants to be made to the Principals.

Terms of the 2007 Plan

The number of shares underlying the options to be granted under the 2007 Plan will equal a number of shares that will constitute, in the aggregate, 20% of our outstanding common stock after giving effect to the reverse stock split and the Securities Exchange. One-third of the options will be granted to each Principal. The options under the 2007 Plan will be granted in three tranches: one third (1/3) of the options will be granted at an exercise price per share of common stock equal to the fair value of such shares, to be determined by the Board of Directors at the time when the options are first granted under the 2007 Plan, but not less than the exercise price of the Warrant to be issued to Longview in the Securities Exchange (the “Initial Option Price”); one third (1/3) of the options will be granted at an exercise price equal to 130% of the Initial Option Price and one third (1/3) of the options shall be granted at an exercise price equal to 150% of the Initial Option Price. The options will have a term of 10 years. One third (1/3) of the options in each tranche will vest on each of the first three anniversaries following the closing of the Securities Exchange. A copy of the 2007 Plan is attached to this Information Statement as Annex C.

The table below sets forth the benefits amounts that are expected to be received by each Principal and certain other persons under the 2007 Plan.

NEW PLAN BENEFITS

The 2007 Non-Qualified Stock Option Plan

Name and Position	Maximum Dollar Value ($)	Maximum Number of Units
Michael Pawelek	$5,654,403 (1)	17,134,555
Wayne Psencik	$5,654,403 (1)	17,134,555
Sherry L. Spurlock	$5,654,403 (1)	17,134,555
Howard Taylor	N/A	0
Richard Freer	N/A	0
Current and future executive officers as a group	$16,963,209 (1)	51,403,665
Non-Executive Director Group	N/A	0
Non-Executive Officer Employee Group	N/A	0

(1) The closing bid price for our common stock on November 27, 2007 was $0.33 per share.

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Tax Consequences of the 2007 Plan

Non-Qualified Options.

An optionee will not recognize any taxable income upon the grant of a non-qualified option under the 2007 Plan. Upon exercise, the optionee will recognize ordinary compensation income, which is generally measured by the excess of the fair market value of the shares on the date of exercise over the exercise price. Any taxable income recognized in connection with an option exercise is subject to income and social security tax withholding by us. Upon a disposition of such shares by the optionee, any difference between the sale price and the fair market value of the shares at exercise, is treated as long-term or short-term capital gain or loss, depending on how long the shares were held after exercise. Unless limited by Section 162(m) of the Code, we are generally entitled to a deduction in the same amount as the ordinary income taxable to the optionee upon option exercise.

Section 409A of the Code.

Section 409A of the Internal Revenue Code imposes penalties, on and after January 1, 2005, on certain deferred compensation arrangements that do not meet the requirements of Section 409A. Under Section 409A, penalties are imposed only on participants and not on us. Generally, if at any time during a taxable year the 2007 Plan fails to meet the requirements of Section 409A, or is not operated in accordance with those requirements, all amounts deferred under the 2007 Plan for the taxable year and all preceding taxable years, by any participant with respect to whom the failure relates, are includible in the participant’s gross income for the taxable year to the extent not subject to a substantial risk of forfeiture and not previously included in gross income. If a deferred amount is required to be included in income under Section 409A, the amount also is subject to interest and a 20% penalty tax. Interest at the underpayment rate plus one percentage point is imposed on the underpayments that would have occurred had the compensation been includible in income for the taxable year when the award was first deferred, or if later, when the award became no longer subject to a substantial risk of forfeiture. In general, options will meet the requirements of Section 409A if the option exercise price is at least equal to the fair market value of the underlying shares on the date the option is granted.

AUTHORIZATION BY THE BOARD OF DIRECTORS

On August 3, 2007, the Board of Directors adopted resolutions approving the reverse stock split, the name change and the adoption of the 2007 Plan. The Board of Directors is authorized to amend our Certificate of Incorporation by filing the Certificate Amendment to effect the reverse stock split of all issued and outstanding shares of our common stock at an exchange ratio ranging from 1-for-5 to 1-for-20. The Certificate Amendment will also change our name to “Sonterra Resources, Inc.”

The Board of Directors will have the sole discretion to elect, based on its determination of the best interests of our company and our stockholders, at which ratio within the approved range to effect the reverse stock split at any time with 120 days after ______, 2007. The Board of Directors believes that approval by the Majority Stockholders of the proposal granting this discretion to the Board of Directors, rather than approval of an immediate reverse stock split at a specified ratio, provides the Board of Directors with maximum flexibility to react to market conditions current at the time, as well as other then current facts and circumstances. The Board of Directors believes that the grant to it of this discretion will best achieve the purposes of the reverse stock split and serve the best interests of our company and our stockholders. It should be noted that although the Board’s resolutions authorize implementation of the reverse stock within a range of ratios from 1-for-5 to 1-for-20, the minimum ratio at which the reverse stock split would enable us to have a sufficient number of authorized shares available to complete the Securities Exchange and reserve a sufficient number of shares for issuance upon exercise of the new options and the Warrant is 1-for-8.

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Accordingly, our board of directors will not consider a ratio for the reverse stock split of less than 1-for-8. Our board of directors will consider a reverse split ratio that will facilitate the ease of administration and computation and that will likely result in the largest practicable public float remaining outstanding. As a result, we expect that the reverse split will likely be effected at a ratio of between 1-for-8 and 1-for-10.

The Board of Directors may elect to abandon the reverse stock split at its sole discretion, subject to Longview’s contractual rights under the Securities Exchange Agreement. One major purpose of the reverse stock split is to enable and facilitate the Securities Exchange, the consummation of which is conditioned on satisfaction of the conditions contained in the Securities Exchange Agreement. There is no assurance that the Securities Exchange will be consummated and, if it is not, the Board of Directors will not implement the reverse stock split or the change of our name, nor will the 2007 Plan be implemented.

In connection with its approval of the reverse stock split, the name change and the 2007 Plan, the Board of Directors elected to obtain stockholder approval through the written consent of the Majority Stockholders rather than to convene a meeting of stockholders in order to reduce associated costs and implement the proposals in a cost effective and timely manner.

CONSENTING STOCKHOLDERS

Under the DGCL and our Bylaws, any action that can be taken at an annual or special meeting of stockholders may be taken without a meeting, without prior notice and without a vote, if the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted, consent to such action in writing. Approval of the Certificate Amendment for the reverse stock split, the change of our name and the 2007 Plan requires the affirmative vote or written consent of a majority of the issued and outstanding shares of our common stock. On November ___, 2007, Longview, LFI and Concorde Capital Limited (a corporation wholly owned by our President Howard Taylor), being the respective record holder(s) of 22,285,614 shares, 3,390,660 shares and 5,156,639 of our common stock, representing, in the aggregate, approximately 80.0% of the outstanding shares of our common stock and constituting the Majority Stockholders, consented in writing to the reverse stock split, the Certificate Amendment and the adoption of the 2007 Plan.

As described above, a major purpose of the reverse stock split is to enable and facilitate the Securities Exchange. The proceeds from the investments by Longview will be used to provide working capital to fund our operations following the consummation of the Securities Exchange. It is in the interest of Longview to approve the reverse stock split and the Certificate Amendment. In addition, it is expected that, after the completion of the Securities Exchange, Longview will own approximately 93.7% of the total outstanding shares of our common stock and its affiliate LFI will own an additional 1.3% of our common stock. See “Reverse Stock Split at a Ratio of At Least 1-for-5 and up to 1-for-20 -- Control by Viking” above.

The approval of the reverse stock split at an exchange ratio ranging from 1-for-5 to 1-for-20 and the name change pursuant to the Certificate Amendment by the Board of Directors and the Majority Stockholders constitute all necessary corporate approvals in connection therewith. We are not seeking written consent from any other stockholders, and the other stockholders will not be given an opportunity to vote with respect to the actions described in this Information Statement. Except for the final determination of the split ratio by the Board, all necessary corporate approvals have been obtained. This Information Statement is furnished solely for the purposes of advising stockholders of the action taken by written consent and giving stockholders notice of such actions taken as required by the DGCL and the Exchange Act.

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We expect to file the Certificate Amendment with the office of the Secretary of the State of the State of Delaware immediately prior to the closing of the Securities Exchange, but in no event earlier than the expiration of the 20 day period mandated by Regulation 14C and the provisions of the DGCL. The Certificate Amendment will become effective upon such filing or such later date as is specified therein.

THE SONTERRA ACQUISITIONS

Sonterra was incorporated in Delaware in April 2007 by Michael J. Pawelek, Wayne A. Psencik and Sherry L. Spurlock, who serve as the executive management team of Sonterra, with the intention of becoming an independent oil and gas exploration and production company primarily engaged in the acquisition, exploration and development of oil and gas properties in the Texas Gulf Coast region. In August 2007, Sonterra purchased interests in certain oil and gas properties and related assets from Cinco and Flash in two separate transactions for an aggregate amount of approximately $5.9 million. Sonterra also incurred transaction fees totaling approximately $694,000, of which $318,950 was allocated to debt issuance costs and $375,000 was incurred to transaction fee expense. The properties and related assets acquired by Sonterra in the Sonterra Acquisitions constitute substantially all of the assets of Sonterra and, upon completion of the Securities Exchange, will constitute substantially all of our assets on a consolidated basis. The following discussion provides additional information regarding Sonterra and the Sonterra Acquisitions, including certain unaudited pro forma financial information that shows the pro forma effect of the Sonterra Acquisitions and the Securities Exchange.

Description of the Sonterra Business and Properties

Sonterra is an independent oil and gas company engaged in the acquisition, exploration, development and production of offshore domestic U.S. oil and gas properties and has been operating since its inception in April 2007. In September, 2007, Sonterra formed a wholly-owned subsidiary, Sonterra Operating, Inc., to act as the named operator of the oil and gas properties that Sonterra operates. Sonterra primarily operates in Matagorda Bay, offshore the Texas coast. Through the Sonterra Acquisitions in August 2007, Sonterra assembled combined acreage of approximately 3,500 gross (900 net) acres with the opportunity to explore for, develop and produce oil and natural gas in several prospects, an interest in two gross producing gas wells (a 58.4% aggregate net interest in the wells before payout and 53.5% aggregate net interest after payout), and a seven-mile pipeline that connects both of Sonterra’s current producing offshore wells to an onshore separation facility. In the first acquisition, on August 3, 2007, Sonterra purchased for approximately $5.0 million cash 60% of the interests held by Cinco in the Texas State Tract 150 Wells No. 1 and No. 2 located in Matagorda Bay, Texas, as well as the 320-acre oil and gas lease related to those wells and certain other leases covering approximately 3,200 additional acres located in Matagorda Bay. In the second transaction, on August 29, 2007, Sonterra purchased for approximately $1.2 million cash all of the interests held by Flash in the Texas State Tract 150 Wells No. 1 and No. 2 and a seven-mile pipeline that connects the wells to the Keller Bay onshore facility located in Calhoun County, Texas.

Sonterra has identified four additional drilling locations on its acquired acreage and expects to drill a well on the first location during the fourth quarter of 2007. At December 31, 2006, the estimated total proved developed and undeveloped oil and gas reserves of the properties acquired in the Sonterra Acquisitions on a pro forma basis were approximately 2,272 million cubic feet (MMcf) of natural gas and 91,000 barrels (Bbls) of oil. Sonterra’s proved reserves are approximately 81% gas and 52.6% proved developed. Using prices as of December 31, 2006, the proved reserves of the properties acquired in the Cinco Acquisition and the Flash Acquisition had an estimated pre-tax net present value, discounted at 10%, or PV-10, of approximately $5.8 million. For estimates of Sonterra’s total proved developed and undeveloped oil and gas reserves , the estimated changes in the quantities of such reserves from December 31, 2005 to December 31, 2006 and a standardized measure of estimated future net cash flows attributable to Sonterra’s proved developed and undeveloped oil and gas reserves, see Note C to the audited financial statements of Certain Acquired Oil and Gas Properties included in this Information Statement.

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For additional information regarding Sonterra’s operations, its plans for exploration for and development and production of oil and gas on the properties acquired in the Cinco Acquisition and the Flash Acquisition, see “Management’s Plan of Operation,” below. Sonterra’s (and after consummation of the Securities Exchange, our) principal source of funds for financing such exploration and development activities will be the right, subject to the conditions set forth in the Securities Exchange Agreement, to require Longview to purchase additional Notes. See “The Securities Exchange – Additional Terms Under the Notes.”

Management’s Plan of Operation

Sonterra’s primary source of liquidity is cash flow from operations. It also has the right, subject to satisfaction of various conditions, in its discretion to require Longview to purchase Additional Notes up to an aggregate principal amount which, when added to the initial principal amount of the Initial Note, may not exceed an aggregate of $10,000,000. As of the date of this information statement, Sonterra has sold the secured Sonterra Non-Equity Note in the principal amount of $2,000,000 to Longview. After the closing of the Securities Exchange, additional promissory notes will by issuable to Longview by us, rather than Sonterra. Sonterra believes that after the closing of the Securities Exchange, it will have sufficient sources of capital, including access to the proceeds of additional Notes issued by us, to fund its operations for the next 12 months, and its future funding requirements will depend on numerous factors, including ongoing costs associated with investigating and acquiring potential oil and gas prospects, exploration and other development costs of acquired oil and gas leases, and costs to recruit and train qualified personnel.

Sonterra will be the operator of the wells acquired in the Sonterra Acquisitions and intends to drill wells in the exploratory prospects that it acquired through the Sonterra Acquisitions. Sonterra also needs to acquire acreage to offset one of the exploratory prospects. In addition to drilling the exploratory prospects, Sonterra intends to make at least one production acquisition within the next six months, which would require additional funds to be raised. At the date of this Information Statement, Sonterra does not presently have any agreements or commitments to make any such additional acquisitions, and there is no assurance that Sonterra will have available the funds necessary to complete any acquisition or that it will be able to reach an agreement to acquire additional prospects on acceptable terms, if at all.

The business model of Sonterra is based on finding production acquisitions with upside proven locations to be drilled. These acquisitions will have associated production equipment. Sonterra does not currently have any employees, but reimburses BOSS for the services of 12 BOSS employees, including the Principals. In addition to the Principals, Sonterra expects that such other BOSS employees will become Sonterra employees after the closing of the Securities Exchange. The number of acquisitions Sonterra completes, if any, will determine whether Sonterra will hire additional employees. There is the potential for a significant increase in the number of employees, once the Securities Exchange closes in the event that Sonterra acquires additional oil and gas properties and related assets.

As of the date of this information statement, Sonterra does not have any off-balance sheet arrangements.

At the closing of the Securities Exchange, we will issue our Initial Note to Longview in exchange for the Sonterra Non-Equity Note and the Sonterra Non-Equity Note will be cancelled. Thereafter, we will have the right, subject to satisfaction of the conditions in the Securities Exchange Agreement, to require Longview to purchase additional Notes in the principal amount of up to $2,000,000 per fiscal quarter, up to an aggregate principal amount that may not exceed, together with the Initial Note, $10,000,000. The Securities Exchange Agreement significantly restricts our ability to incur indebtedness other than by issuing additional Notes to Longview. See “The Securities Exchange – The Securities Exchange Agreement – Negative Covenants.” Accordingly, we are unable to satisfy the conditions precedent to Longview’s obligation to purchase Additional Notes set forth in the Securities Exchange Agreement and Longview is unwilling to waive or modify such conditions, we would likely be unable to raise the funds required to make the acquisitions contemplated by our business model.

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Unaudited Pro Forma Condensed Consolidated Financial Information

The unaudited pro forma condensed consolidated financial statements set forth below are based on the audited financial statements of the Company included in the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2006 filed with the SEC; the audited financial statements of Certain Acquired Oil and Gas Properties for such year and for the period January 1, 2007 to August 3, 2007 included in this Information Statement; the audited financial statements of Sonterra Resources, Inc. for the period of its inception, April 17, 2007 to September 30, 2007 included in this Information Statement; and the unaudited financial statements of the Company included in the Company’s Quarterly Report on Form 10-QSB for the nine months ended September 30, 2007.

The unaudited pro forma condensed consolidated financial statements give effect to the Sonterra Acquisitions, including the financing described under “The Securities Exchange – The Sonterra Financing” and “ – Additional Terms Under the Notes” as if each had occurred on January 1, 2006 (in the case of the unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 2006 and the nine months ended September 30, 2007), or on September 30, 2007 (in the case of the unaudited pro forma condensed consolidated balance sheet as of that date). The unaudited pro forma condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the SEC for the preparation of pro forma financial statements. They are based upon available information, preliminary estimates and certain assumptions that we believe are reasonable and are described in the accompanying notes to the unaudited pro forma condensed consolidated financial statements. We emphasize, however, that the unaudited pro forma condensed consolidated financial statements are provided for illustrative purposes only and are subject to a number of uncertainties and assumptions and do not purport to represent what the Company’s and the Certain Acquired Oil and Gas Properties’ and Sonterra’s actual combined performance or financial position would have been had the transactions occurred on the dates indicated and do not purport to indicate financial position or results of operations as of any future date or for any future period.

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Unaudited Pro Forma Condensed Consolidated Balance Sheet
As of September 30, 2007
							Pro Forma		Pro Forma
							Adjustments		Adjustments
							Related to		Related to
							Acquisition of		Acquisition of
							Sonterra	Certain	Certain		Pro Forma
						Sonterra	Resources, Inc.	Acquired	Properties		Consolidated
					RCGI	Resources, Inc.	(Note A, C)	Properties	(Note B, D)		Balance Sheet
Assets
	Current Assets
		Cash and equivalents			$ 95,016	$ 1,623,581	$ -	$ -	$ (455,052)	(7)	$ 1,263,545
		Accounts receivable, net			-	401,856	-	-	-		401,856
		Prepaid expenses and other			28,290	-	-	-	-		28,290
	Total Current Assets				123,306	2,025,437	-	-	(455,052)		1,693,691

	Property and Equipment, net
		Oil and Gas Properties, full
			cost method
				Unproved properties	-	695,505	-	462,609	(462,609)	(6)	695,505
				Proved properties	-	4,323,586	-	2,664,194	(2,664,194)	(6)	4,460,856
									37,270	(8)
			Pipeline and facilities		-	813,927	-	813,927	(813,927)	(6)	819,728
									5,801	(8)
		Other property and equipment			-	58,000	-	-	-		58,000
	Total Property and Equipment, net				-	5,891,018	-	3,940,730	(3,797,659)		6,034,089

	Other Assets
		Debt issuance costs, net of
			amortization		-	312,548	-	-	13,787	(9)	326,335
					-	312,548	-	-	13,787		326,335

Total Assets					$ 123,306	$ 8,229,003	$ -	$ 3,940,730	$ (4,238,924)		$ 8,054,115

Refer to accompanying notes to the unaudited pro forma condensed consolidated financial statements.

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						Pro Forma			Pro Forma
						Adjustments			Adjustments
						Related to			Related to
						Acquisition of			Acquisition of
						Sonterra		Certain	Certain		Pro Forma
					Sonterra	Resources, Inc.		Acquired	Properties		Consolidated
				RCGI	Resources, Inc.	(Note A, C)		Properties	(Note B, D)		Balance Sheet
Liabilities
	Current Liabilities
		Accounts payable, trade and
			accrued liabilities	$ 46,127	$ 500,057	$ -		$ -	$ -		$ 546,184
		Interest payable		-	156,716	-		-	(156,716)	(7)	-
		Accounts payable to related
			parties	115,868	-	-		-	-		115,868
	Total Current Liabilities			161,995	656,773	-		-	(156,716)		662,052
	Noncurrent Liabilities
		Long-term debt		-	7,990,010	(5,990,010)	(3)	-	-		2,000,000
						(2,000,000)	(4)
						2,000,000	(4)
		Asset retirement obligation		-	105,510	-		103,311	(103,311)	(6)	105,510
	Total Noncurrent Liabilities			-	8,095,520	(5,990,010)		103,311	(103,311)		2,105,510

Total Liabilities				161,995	8,752,293	(5,990,010)		103,311	(260,027)		2,767,562
Shareholders' Equity (Deficit)
		Common stock		38,552	10,890	(900)	(3)	-	-		257,018
						218,466	(3)
						(9,990)	(3)
		Additional paid in capital		2,397,193	-	5,771,544	(3)	-	143,071	(8)	7,857,969
						9,990	(3)		13,787	(7)
						(179,280)	(3)		(298,336)	(7)
		Treasury stock		-	(900)	900	(3)	-	-		-
		Retained earnings (deficit)		(2,474,434)	(533,280)	179,280	(3)	3,837,419	(3,837,419)	(6)	(2,828,434)
	Total Shareholders' Equity
		(Deficit)		(38,689)	(523,290)	5,990,010		3,837,419	(3,978,897)		5,286,553
Total Liabilities and Shareholders'
	Equity (Deficit)			$ 123,306	$ 8,229,003	$ -		$ 3,940,730	$ (4,238,924)		$ 8,054,115
Refer to accompanying notes to the unaudited pro forma condensed consolidated financial statements.

-30-

Unaudited Pro Forma Condensed Consolidated Statement of Operations
For the Nine Months Ended September 30, 2007
					Pro Forma			Pro Forma
					Adjustments			Adjustments
					Related to			Related to
					Acquisition of			Acquisition of		Pro Forma
					Sonterra		Certain	Certain		Consolidated
				Sonterra	Resources, Inc.		Acquired	Properties		Statement of
			RCGI	Resources, Inc.	(Note A, C)		Properties	(Note B, D)		Operations
Revenues
	Oil and gas sales		$ -	$ 317,057	$ -		$ 1,883,900	$ 28,853	(10)	$ 2,229,810
	Other operating income		-	134,186	-		88,539	17,135	(10)	239,860
Total Revenues			-	451,243	-		1,972,439	45,988		2,469,670

Costs and Expenses
	Lease operating expenses		-	145,293			730,335	30,111	(10)	905,739
	Production taxes		-	20,280	-		123,885	1,785	(10)	145,950
	Pipeline operating expenses		-	-	-		6,563	-		6,563
	Depreciation, depletion and
		amortization	-	145,071	-		584,013	(38,293)	(12)	690,791
	General and administrative		276,970	500,370			71,800	5,800	(10)	854,940
Total Costs and Expenses			276,970	811,014	-		1,516,596	(597)		2,603,983

Other Income (Expense)
	Interest income		2,148	-			-			2,148
	Other income		130,000	-	-		-	-		130,000
	Interest expense		(322)	(173,509)	-		-	(45,313)	(11)	(286,942)
					-		-	(67,798)	(13)	-
Total Other Income (Expense)			131,826	(173,509)	-		-	(113,111)		(154,794)

Income (loss) before tax			(145,144)	(533,280)	-		455,843	(66,526)		(289,107)
	Income tax expense		-	-	-	(14)	173,220	10,252	(10)	183,472


Net Income (Loss)			$ (145,144)	$ (533,280)	$ -		$ 282,623	$ (76,778)		$ (472,579)

Net Income (Loss) Per Share
	Basic and diluted		$ (0.00)	N/A	$ -					$ (0.02)

Weighted average shares
	outstanding
		Basic and diluted	38,517,381	182	(182)	(3)				25,714,564
					218,465,578	(3)
					(231,268,395)	(5)

Refer to accompanying notes to the unaudited pro forma condensed consolidated financial statements.

-31-

Unaudited Pro Forma Consolidated Statement of Operations

For the Year Ended December 31, 2006

	RCGI	Sonterra Resources, Inc.	Pro Forma Adjustments Related to Acquisition of Sonterra Resources, Inc. (Note A, C)		Certain Acquired Properties	Pro Forma Adjustments Related to Acquisition of Certain Properties (Note B, D)		Pro Forma Consolidated Statement of Operations
Revenues
Oil and gas sales	$ 0	$ 0	$ 0		$4,722,640	$ 0		$4,722,640
Other operating income	0	0	0		168,002	0		168,002
Total Revenues	0	0	0		4,890,642	0		4,890,642
Costs and Expenses
Lease operating expenses	0	0	0		1,210,208	0		1,210,208
Productions taxes	0	0	0		306,912	0		306,912
Pipeline operating expenses	0	0	0		5,080	0		5,080
Depreciation, depletion and amortization	0	0	0		1,514,496	(11,374)	(12)	1,503,122
Impairment of pipeline	0	0	0		1,330,000	0		1,330,000
General and administrative	640,564	0	0		216,000	0		856,564
Total Costs and Expenses	640,564	0	0		4,582,696	(11,374)		5,211,886
Other Income (Expense)
Interest income	2,073	0	0		0	0		2,073
Interest expense	(208,881)	0	0		0	(298,448)	(11)	(639,245)
						(131,916)	(13)
Total Other Income (Expense)	(206,808)	0	0		0	(430,364)		(637,172)
Income (loss) before tax	(847,372)	0	0		307,946	(418,990)		(958,416)
Income tax expense	0	0	0	(14)	117,019	0	(14)	117,019
Net Income (Loss)	($847,372)	$ 0	$ 0		$190,927	($418,990)		($1,075,435)
Net Income (Loss) Per Share
Basic and diluted	($ 0.03)	$ 0.00	$ 0.00					($ 0.04)
Weighted average shares outstanding
Basic and diluted	26,064,226	30	333	(1)				24,452,980
			( 30)	(2)
			( 333)	(3)
			218,465,578	(3)
			(220,076,824)	(5)

Refer to accompanying notes to the unaudited pro forma consolidated financial statements.

-32-

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

A) ACQUISITION OF SONTERRA RESOURCES, INC.

The unaudited pro forma condensed consolidated financial statements reflect the securities transactions described in 1) the original securities purchase agreement between Longview and Sonterra entered into on July 9, 2007, 2) the amended and restated securities agreement between Longview and Sonterra (“Sonterra SPA”) executed on August 3, 2007, and 3) the intended acquisition by us of Sonterra as described by the securities exchange agreement between us and Longview (“Securities Exchange Agreement”) entered into on August 3, 2007. The transactions described in these agreements are assumed to have occurred on January 1, 2006 (in the case of the unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 2006 and the nine months ended September 30, 2007), or on September 30, 2007 (in the case of the unaudited pro forma condensed consolidated balance sheet as of that date). The following adjustments have been made to give effect to that transaction.

(1)

Issue 333 shares of Sonterra no par common stock for an agreed upon purchase price of $30 per share to Longview pursuant to the Sonterra SPA.

(2)

Redeem 30 shares of outstanding Sonterra common stock for $30 per share from all shareholders other than Longview pursuant to the Sonterra SPA.

(3)

Exchange 333 shares of Sonterra common stock owned by Longview, the Sonterra Equity Note in the amount of $5,990,010 issued to Longview and the Sonterra Warrant issued to Longview for 218,465,578 shares of RCGI common stock and a Warrant for the purchase of 49,586,777 shares of RCGI common stock. This transaction occurs pursuant to the Securities Exchange Agreement and represents an exchange of shares between entities under common control, accounted for in the accounts of RCGI by recognizing the assets and liabilities transferred from Sonterra at their carrying amounts at the date of transfer. The retained deficit of Sonterra at the date of transfer is reclassified to additional paid in capital in the accounts of RCGI.

(4)

Exchange Sonterra Non-Equity Note issued to Longview for the Initial Note issued to Longview pursuant to the Securities Exchange Agreement.

(5)

Reduce shares of our common stock outstanding to give effect to the reverse stock split, assuming such split will occur at a 1-for-10 rate.

(14)

No income tax benefit or related deferred tax asset pro forma adjustment is recorded for the year ended December 31, 2006 or for the nine month period ended September 30, 2007. The uncertainty of the eventual realization of a deferred income tax asset balance requires the application of a full valuation allowance against any income tax benefit, resulting in a net zero income tax benefit and deferred tax asset. However, the Federal and State income tax expense recognized for 2006 and 2007 for the Certain Acquired Properties was kept in place as such amount would be due under the separate return method of computing income taxes.

-33-

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS - continued

B) ACQUISITION OF CERTAIN ACQUIRED OIL AND GAS PROPERTIES

On July 9, 2007, Sonterra Resources, Inc., (“Sonterra”) entered into a purchase and sale agreement with Cinco Natural Resources Corporation (“Cinco”) for the acquisition of certain oil and gas interests in Calhoun and Matagorda Counties, Texas (the “Cinco Acquisition”). Also on July 9, 2007, pursuant to the original securities purchase agreement with Sonterra, Longview advanced $322,500 to Sonterra, evidenced by a senior secured note of Sonterra (the “Deposit Note”). On August 3, 2007, in connection with the closing of the Cinco Acquisition and pursuant to the Sonterra SPA, Longview advanced $5,990,010 to Sonterra (of which $322,500 refinanced the Deposit Note) evidenced by the Sonterra Equity Note issued to Longview. On August 3, 2007, Sonterra closed the Cinco Acquisition and also entered into a purchase and sale agreement with Flash Gas and Oil Southwest for the purchase of the remaining properties constituting the Sonterra Acquisitions (the “Flash Acquisition”). On August 29, 2007, Sonterra issued a promissory note in the principal amount of $2,000,000 (“Sonterra Non-Equity Note”) to Longview and closed the Flash Acquisition with proceeds from the Non-Equity Note. Collectively, the properties acquired in the Cinco Acquisition and the Flash Acquisition are referred to as “Certain Acquired Oil and Gas Properties.” The unaudited pro forma condensed consolidated financial statements assume the acquisition of Certain Acquired Oil and Gas Properties and the related debt transactions as if the transactions had occurred on January 1, 2006 (in the case of the unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 2006 and the nine months ended September 30, 2007), or on September 30, 2007 (in the case of the unaudited pro forma condensed consolidated balance sheet as of that date). The following adjustments have been made to give effect to the transactions.

(6)

Eliminate the net book value, as recorded on the books of Certain Acquired Properties immediately preceding acquisition by Sonterra, of the acquired properties and related asset retirement obligation and equity balance.

(7)

Eliminate the net increase to cash, interest payable and retained earnings recognized by Sonterra resulting from the revenues and expenses for the acquired properties and the debt issued in connection with their acquisition from the dates of acquisition through September 30, 2007.

(8)

Eliminate the provision for DD&A related to the acquired assets recognized by Sonterra from the dates of acquisition through September 30, 2007.

(9)

Eliminate the capitalized debt issuance costs amortization recognized by Sonterra from the dates of acquisition through September 30, 2007. These costs are related to the debt issued in connection with the acquisition of certain acquired properties.

(10)

The audited financial statements for Certain Acquired Properties are prepared for the period ending August 3, 2007, and accordingly include results of operations through that date. The properties acquired by Sonterra from Cinco were acquired on August 29, 2007. This adjustment adds to the pro forma financial information the revenues and expenses for the properties acquired by Sonterra from Cinco for the period August 3, 2007 to August 29, 2007.

(11)

Add interest expense for the year ended December 31, 2006, and adjust interest expense for the nine months ended September 30, 2007 to reflect the amount calculated as if the Initial Note issued to Longview had been outstanding from January 1, 2006. Interest on the Initial Note accrues at a rate equal to a 3month LIBOR rate plus 8.25%, redetermined for each calendar quarter. For the calculation of pro forma interest expense adjustments, rates varied from 12.93% to 16.62% per annum for 2006, and from 13.61% to 13.79% per annum for 2007. The current rate is 13.48% per annum.

(12)

Adjust DD&A expense for the year ended December 31, 2006, and the nine months ended September 30, 2007 to give effect to Sonterra’s acquisition cost as of January 1, 2006. The DD&A expense was calculated for the oil and gas properties according to the unit-of-production method using estimates of proved reserves as determined by independent engineers. DD&A expense also includes a component for the depreciation of the pipeline, calculated on a straight-line basis over the estimated useful life of the pipeline. For the year ended December 31, 2006, a net negative adjustment to DD&A expense was recognized as a result of a positive adjustment for DD&A expense related to the oil and gas properties ($64,063) offset by a negative adjustment for pipeline depreciation ($75,437). Depreciation reported in the Sellers’ financial statements was calculated for 2006 before the 2006 pipeline impairment was calculated, resulting in a higher depreciation expense based on a higher pre-impairment asset book value.

-34

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS – continued

B) ACQUISITION OF CERTAIN ACQUIRED OIL AND GAS PROPERTIES (continued)

(13)

Add the amortization of capitalized debt issuance costs for the year ended December 31, 2006, and adjust the amortization amount for the nine months ended September 30, 2007 to reflect the amount calculated as if the capitalized debt issuance costs were incurred at January 1, 2006.

(14)

C) 2007 STOCK OPTION PLAN

Pursuant to a stock option plan to be established as a condition of the Securities Exchange Agreement (“2007 Plan”) and upon consummation of the transactions described therein, options will be granted to each of the three Principals of Sonterra. The number of shares underlying the options to be granted under the 2007 Plan will equal a number of shares that will constitute, in the aggregate, 20% of our outstanding common stock after giving effect to the reverse stock split and the Securities Exchange. One-third of the options will be granted to each Principal. The options under the 2007 Plan will be granted in three tranches: one third (1/3) of the options will be granted at an exercise price per share of common stock equal to the fair value of such shares, to be determined by the Board of Directors at the time when the options are first granted under the 2007 Plan, but not less than the exercise price of the Warrant to be issued to Longview in the Securities Exchange (the “Initial

Option Price”); one third (1/3) of the options will be granted at an exercise price equal to 130% of the Initial Option Price and one third (1/3) of the options shall be granted at an exercise price equal to 150% of the Initial Option Price. The options will have a term of 10 years. One third (1/3) of the options in each tranche will vest on each of the first three anniversaries following the closing of the Securities Exchange. The granting of these options concurrent with consummation of the Securities Exchange Transactions is considered a nonrecurring transaction directly attributable to the acquisition of Sonterra and accordingly, no related pro forma adjustments are reflected on the Unaudited Pro Forma Consolidated Statements of Operations. The granting of these options has no effect on the Unaudited Pro Forma Consolidated Balance Sheet.

D)	OIL AND GAS PRODUCING ACTIVITIES AND PROPERTIES

The following Unaudited information has been prepared in accordance with Statement of Financial Accounting Standard No. 69, Disclosure about Oil and Gas Producing Activities (SFAS 69).

The estimates of proved reserves and related future net cash flows that are presented in the following tables are based upon estimates made by independent petroleum engineering consultants. The reserve information was prepared as of December 31, 2006. Prior period quantities were computed based on the December 31, 2006 reserve information, rolled back for actual production and sales information. Accordingly, there are no “revisions of previous engineering estimates”. There are many inherent uncertainties in estimating proved reserve quantities, projecting future production rates, and timing of development expenditures. Accordingly, these estimates are likely to change as future information becomes available. Proved developed reserves are the estimated quantities of crude oil, condensate, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions.

-35-

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS – continued

D)	OIL AND GAS PRODUCING ACTIVITIES AND PROPERTIES (continued)

Changes in estimated net quantities of conventional oil and gas reserves, all of which are located within the United States, are as follows:


	RCGI	Sonterra Resources, Inc.	Certain Acquired Properties		Consolidated
Proved developed and undeveloped reserves:
Natural gas (mcf):
January 1, 2006 quantities	—	—	2,760,975		2,760,975
Extensions and discoveries	—	—	—		—
Reserves purchased	—	—	—		—
Sales volumes	—	—	(489,138	)	(489,138	)
Revisions of previous engineering estimates	—	—	—		—
Reserves transferred	—	—	—		—
December 31, 2006 reserve quantities	—	—	2,271,837		2,271,837
Crude oil (Bbl):
January 1, 2006 reserve quantities	—	—	111,987		111,987
Extensions and discoveries	—	—	—		—
Reserves purchased	—	—	—		—
Sales volumes	—	—	(21,028	)	(21,028	)
Revisions of previous engineering estimates	—	—	—		—
Reserves transferred	—	—	—		—
December 31, 2006 reserve quantities	—	—	90,959		90,959
Proved developed reserves:
Natural gas (mcf):
January 1, 2006	—	—	1,694,089		1,694,089
December 31, 2006	—	—	1,204,951		1,204,951
Crude oil (Bbl):
January 1, 2006	—	—	66,995		66,995
December 31, 2006	—	—	45,967		45,967

-36-

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS:

D) OIL AND GAS PRODUCING ACTIVITIES AND PROPERTIES (continued)

The following table sets forth a standardized measure of the estimated discounted future net cash flows attributable to proved developed and undeveloped oil and gas reserves. Prices used to determine future cash inflows were based on the December 31, 2006 period end price for the proved developed reserves of $5.64 per mcf of gas and $57.75 per barrel of oil. The future production and development costs represent the estimated future expenditures to be incurred in developing and producing the proved reserves, assuming continuation of existing economic conditions. Future income tax expense was estimated at 35% for combined federal and state rate.

As of December 31, 2006:	RCGI		Sonterra Resources, Inc.		Certain Acquired Properties			Consolidated
Future cash inflows	$	—	$	—	$	17,219,147		$	17,219,147
Future production and development costs		—		—		(8,091,886	)		(8,091,886	)
Future income tax expense		—		—		(3,408,328	)		(3,408,328	)
Future net cash flows		—		—		5,718,933			5,718,933
10% annual discount to reflect timing of net cash flows		—		—		(2,083,707	)		(2,083,707	)
Standardized measure of discounted future net cash flows relating to proved reserves	$	—	$	—	$	3,635,226		$	3,635,226

The principal factors comprising the changes in the standardized measure of discounted future net cash flows are as follows:

	RCGI		Sonterra Resources, Inc.		Certain Acquired Properties			Consolidated

Standardized measure, January 1, 2006	$	—	$	—	$	4,922,569		$	4,922,569
Extensions and discoveries		—		—		—			—
Reserves purchased		—		—		—			—
Development costs incurred		—		—		115,879			115,879
Sales and transfers, net of production costs		—		—		(3,205,520	)		(3,205,520	)
Revisions in quantity and price estimates		—		—		—			—
Net change in income taxes		—		—		1,063,480			1,063,480
Accretion of discount		—		—		738,818			738,818
Standardized measure, December 31, 2006	$	—	$	—	$	3,635,226		$	3,635,226

-37-

DESCRIPTION OF OUR CAPITAL STOCK

Our authorized capital currently consists of 50,000,000 shares of common stock. Each share of our common stock entitles its record holder to one (1) vote per share held on all matters submitted to a vote of stockholders. Holders of our common stock do not have cumulative voting, conversion, redemption rights or preemptive rights to acquire additional shares. The holders of our common stock are entitled to dividends and distributions when, as, and if declared by the Board of Directors from funds legally available therefore. Under the Securities Exchange Agreement, however, until the latest of (i) expiration of the period in which we may request Longview to purchase additional Notes, (ii) the date on which no Notes are outstanding and (iii) termination of the security agreement with Longview, we may not declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) on any of our capital stock. Upon liquidation, dissolution or winding up, and after payment of creditors, our assets will be divided pro-rata on a share-for-share basis among the holders our common stock. All shares of common stock now outstanding are fully paid, validly issued and non-assessable. At the close of business on the Record Date, we had 38,552,749 shares of common stock issued and outstanding.

DISSENTERS’ RIGHTS OF APPRAISAL

The DGCL does not provide for dissenter’s rights of appraisal in connection with the reverse stock split or the amendment to our Certificate of Incorporation.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table provides information known to us about the beneficial ownership of our common stock as of October 31, 2007 (without giving effect to the Securities Exchange or the proposed reverse stock split), for: (1) each person, entity or group that is known by us to beneficially own five percent or more of our common stock; (2) each of our directors; (3) each of our named executive officers and each Principal; and (4) our directors and executive officers as a group.

Name and address of beneficial owner	Amount and nature of beneficial ownership	Percent of class (1)
The Longview Fund, LP	22,285,614(2)(4)(5)	57.8%(2)(4)(5)
600 Montgomery Street 44th Floor
San Francisco, CA 94111

Longview Fund International, Ltd.	3,390,660(3)(4)(5)	8.8%(3)(4)(5)
c/o Nemours Trustees Limited,
Nemours Chambers, Quomar Complex
4F, Road Town, Tortola, British Virgin Islands.

Concorde Capital Limited	5,156,639(6)	13.4%(6)
Suite 194, 48 Par La Ville Road
Hamilton HM11 Bermuda

Howard Taylor(7)	5,156,639(6)	13.4%(6)
Suite 312, 7 Reid Street
Hamilton, Bermuda

-38 -

Name and address of beneficial owner	Amount and nature of beneficial ownership	Percent of class (1)
William Dickie (7)	35,000	*
Richard Freer(7)	10,000	*
Michael Pawelek (8)	(9)	(9)
Wayne A. Psencik (8)	(9)	(9)
Sherry L. Spurlock (8)	(9)	(9)
All Officers and Directors as a Group (3 persons) (10)	5,201,639	13.5%

*less than 1%.

(1) This table is based on 38,552,749 shares of Common Stock outstanding as of October 31, 2007. If a person listed on this table has the right to obtain additional shares of Common Stock within sixty (60) days from October 31, 2007, the additional shares are deemed to be outstanding for the purpose of computing the percentage of class owned by such person, but are not deemed to be outstanding for the purpose of computing the percentage of any other person.

(2) According to a Schedule 13D filed on August 9, 2007 by Viking, Longview, LFI and certain other persons (the “Viking Group 13D”), the sole general partner of Longview is Viking Asset Management Ltd., a British Virgin Islands international business company (“Longview GP”), which provides managerial, investment and administrative services to affiliated entities. The address of Longview GP is c/o Nemours Chambers, Quomar Complex 4F, Road Town, Tortola, British Virgin Islands. Longview GP has delegated its investment advisory responsibilities with respect to Longview to Viking which, in its capacity as the investment advisor of Longview GP, makes all investment decisions for Longview. Viking’s principal address is 600 Montgomery Street, 44th Floor, San Francisco, California 94111.

(3) According to the Viking Group 13D, LFI is a British Virgin Islands international business company that (directly and indirectly through subsidiaries or affiliated companies or both) is principally engaged in the business of investing in equity, debt and other securities and assets. Longview GP is the investment manager of LFI, and Viking is the sub-investment manager of LFI. In accordance with such relationships, LFI has delegated to Longview GP investment advisory responsibilities with respect to LFI. In its capacity as the investment advisor of Longview GP, Viking makes all investment decisions for LFI.

(4) According to the Viking Group 13D, Mr. Peter Benz is the Chairman and Chief Executive Officer and a Managing Member of Viking and may be deemed to control the business activities, including the investment activities, of one or more of Viking, Longview GP, Longview and LFI.

(5) According to the Viking Group 13D, Viking and Longview GP each may be deemed to have shared voting and dispositive authority over the shares of our common stock owned by Longview and LFI, a total of 25,676,274 shares or 66.6% of our outstanding common stock. Mr. Benz, as a control person of Viking, Longview GP, Longview and/or LFI, may be deemed to beneficially own all such shares.

(6) All of these shares are held in the name of Concorde Capital Limited, which is 100% owned and controlled by Howard Taylor, a director and our Chief Executive Officer and Chief Financial Officer.

(7) The address of each of Messrs. Taylor, Dickie & Freer is Suite 312, 7 Reid Street, Hamilton Bermuda, HM11.

(8)The address of each of Messrs. Pawelek and Psencik and Ms. Spurlock is 300 East Sonterra Boulevard, Suite 1220, San Antonio Texas, 78258.

(9) Messrs. Pawelek and Psencik and Ms. Spurlock do not beneficially own any shares of our common stock at the date of this Information Statement. Upon consummation of the Securities Exchange, each will receive options to purchase 17,134,555 shares of our common stock, subject to adjustment to reflect the reverse split of our common stock. See “The 2007 Non-Qualified Stock Option Plan.”

(10) Does not include Messrs. Pawelek and Psencik or Ms. Spurlock. See note (9).

-39 -

NEW DIRECTOR AND EXECUTIVE OFFICER APPOINTEES

In connection with the Securities Exchange, Mr. Michael Pawelek will be appointed to our Board. It is anticipated that Mr. Taylor and Mr. Dickie will resign from our Board. Because Mr. Pawelek will constitute the sole member of our Board and will be appointed without a meeting of stockholders, Section 14(f) of the Exchange Act and Rule 14f-1 thereunder require that we furnish our stockholders with certain information in connection with the appointment of Mr. Pawelek to our Board of Directors. We are also providing such information regarding all other Principals who, together with Mr. Pawelek, will be our executive officers after the closing of the Securities Exchange.

The following paragraphs set forth, with respect to each of the Principals, the name, age as of October 31, 2007, present principal occupation and employment history during the past five years. Each of the Principals (unless otherwise specified) has informed us that he or she is a U.S. citizen and Mr. Pawelek has consented to act as our director upon appointment. The business address of each Principal is 300 East Sonterra Boulevard, Suite 1220, San Antonio, Texas, 78258.

Michael J. Pawelek, 49, has served as the President of Sonterra since its inception in April 2007. Through October 2007, Mr. Pawelek was also the President of Boss Exploration & Production Corporation, a position he held since 2004. Mr. Pawelek was responsible for the operations of Boss Exploration. From 2000 to 2004, Mr. Pawelek served as a Vice President in control of operations for IBC Petroleum, Inc., where he oversaw the operations of the company. Mr. Pawelek has a bachelor of science degree from Texas A&M University in civil engineering. Mr. Pawelek will become our President and CEO upon the closing of the Securities Exchange.

Wayne A. Psencik, 44, has served as the Vice President—Operations of Sonterra since its inception in April 2007. Through October 2007, Mr. Psencik was also the Vice President of operations of Boss Exploration & Production Corporation, a position he held since June 2005. Mr. Psencik was responsible for the operations of Boss Exploration. Prior to his employment with Boss, Mr. Psencik served as an engineer and drilling manager at El Paso Energy, where he was responsible for the design and implementation of drilling and completion operations and the supervision of staff engineers. Mr. Psencik has a bachelor of science degree from Texas A&M University in petroleum engineering. Mr. Psencik will become our Vice President-Operations upon the closing of the Securities Exchange.

Sherry L. Spurlock, 46, has served as the Chief Financial Officer Controller of Sonterra since its inception in April 2007. Through October, 2007, Ms. Spurlock was also the Chief Financial Officer of Boss Exploration & Production Corporation, a position she held since August 2005. Ms. Spurlock was responsible for the preparation of the financial statements and other financial and accounting matters for Boss Exploration. Prior to her employment with Boss, Ms. Spurlock was the controller and held various other financial positions with United Oil & Minerals, LP. Ms. Spurlock is a CPA and has a bachelors of business administration degree from Stephen F. Austin State University in accounting. Ms. Spurlock will become our Chief Financial Officer upon the closing of the Securities Exchange.

None of the Principals has during the past five years (i) been convicted in a criminal proceeding or (ii) been a party to any judicial or administrative proceeding that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, U.S. federal or state securities laws, or a finding of any violation of U.S. federal or state securities laws. None of the Principals are currently a director of or holds any position with us. None of the Principals has any family relationship with any of our director, executive officer or key employees.

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DIRECTORS AND EXECUTIVE OFFICERS

Information about our executive officers and directors as of October 31, 2007 follows:

Name	Age	Position
Howard Taylor	46	Chief Executive Officer, Chief Financial Officer and Director
William Dickie	64	Director
Richard Freer	66	Secretary

Howard Taylor, Chief Executive Officer, Chief Financial Officer and Director. Mr. Taylor was appointed as a director and our Chief Executive Officer in April 2004 and as Chief Financial Officer in January 2006. Mr. Taylor has been the sole stockholder and a director of Concorde Capital Limited, a privately held investment company based in Bermuda, since 1995. Mr. Taylor was previously an executive with County Natwest Securities, an international investment bank. He has been a director with an NASD and SFA broker dealer, experienced in both the London and United States markets. He has held the NASD Series 7, 24 and 63 licenses and is a Fellow of the Securities Institute in the United Kingdom. Mr. Taylor has extensive experience in the sourcing, structuring and execution of a broad range of private equity transactions.

William P. Dickie, Director. Mr. Dickie served as one of our directors from August 1999 to December 31, 2005 and was subsequently re-appointed a director in June 2007. On September 3, 2003, Mr. Dickie was appointed as our Secretary and Chief Financial Officer and he served in those positions until December 31, 2005. From 2001 to present, Mr. Dickie has been the owner and President of Cognate Engineering Services Inc., a company that provides administrative and consulting services to public and private companies ranging from accounting, corporate secretarial and office accommodations to financing, business proposals and restructuring.

Richard Freer. Mr. Freer was appointed as Secretary for our company in February 2006. Mr. Freer has over 40 years of experience in international finance. A citizen of Canada, Mr. Freer has served since 2005 as Finance Director and Secretary of Concorde Capital Limited, a private investment company located in Bermuda. Since 1996, Mr. Freer has also served as Chief Financial Officer of D.J. Limited, an investment group dealing in international money management and corporate finance located in Bermuda.

INTEREST OF CERTAIN PERSONS IN THE REVERSE STOCK SPLIT AND THE SECURITIES EXCHANGE

Except as described below, directors, officers, the Principals and more then 5% stockholders do not have any interest in the reverse stock split, the Certificate Amendment and the 2007 Plan other than their interests as stockholders, and the respective number of shares held by such persons will be reduced in the reverse stock split to the same extent as our other stockholders.

Employment Agreements

Each of Messrs. Pawelek, Psencik and Spurlock will enter into an employment agreement with us pursuant to which they will be employed by us as Chief Executive Officer, Vice President-Operations and Chief Financial Officer, respectively. Their base salaries will initially be $200,000, $180,000 and $120,000 per year, respectively, subject to adjustment as determined by the Board of Directors in its sole discretion. Each agreement provides that the employee will be entitled to participate in all employee benefit plans, programs and arrangements that we generally make available to our senior executives and that we shall provide them with health, dental, disability and life insurance under the group health, dental disability and life insurance programs we maintain for full-time salaried employees.

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Each agreement acknowledges that we are not required to adopt or maintain any type of plan or policy but requires that we provide health insurance for the employee and his or her family at all times during the employment term. Each agreement contains provisions prohibiting the employee from disclosing our confidential or proprietary information and requiring assignment to us of proprietary rights relating to our business that arise from the employee’s physical presence at our premises or use of our physical or intellectual property, or that are based on information gained by the employee through employment with us.

Each employment agreement has an initial term of two years and is thereafter automatically extended for additional terms of one year unless either party gives notice of termination at least 90 days prior to the end of the initial term or any one-year extension. We may terminate the agreements for “cause,” including dishonesty in the performance of the employee’s duties, conviction of certain crimes, willful acts or omissions by the employee that are or are likely to be injurious to us, material breach of the agreement, appropriation of a corporate opportunity or material asset, inability to register our securities with the SEC or list our securities on a stock exchange due to the employee’s failure to disclose background information, or failure of the employee to comply with lawful directives of our board not inconsistent with the agreement. We may also terminate the agreement at any time without cause. The agreements also terminate upon death or disability of the employee. An employee may terminate the agreement for “good reason,” which is defined as a material breach by us not cured within 30 days after notice from the employee, relocation of our principal offices outside of San Antonio, Texas, or a reduction of the employee’s base salary in connection with a general reduction applicable to all employees that is not fully restored to the original amount within 90 days. Upon termination for death or cause, we are required to pay the employee’s accrued and unpaid base salary and vacation and the employee’s reimbursable expenses through the termination date. Upon termination for disability, we are required to pay the employee’s accrued vacation and reimbursable expenses and to continue to provide group medical and dental insurance for the employee and the employee’s immediate family for an additional six months after termination. If we terminate the employee without cause, or if the employee terminates the agreement for good reason based on our breach of the agreement, we are required to pay the employee’s accrued vacation and reimbursable expenses through the termination date, to pay the employee’s base salary through the termination date and for six months thereafter, and to continue to provide group medical and dental insurance for the employee and the employee’s immediate family for such additional six months. Upon termination by the employee for any other good reason, we are required to pay the employee’s salary and accrued vacation and reimbursable expenses through the termination date. Upon termination of employment, the employee must refrain from competing with us for a period of six months. However, this prohibition does not apply if the employee terminates the agreement upon a relocation of our company or reduction of the employee’s salary, or upon non-renewal of the agreement by either us or the employee.

The foregoing summary of the material terms of the employment agreements to be entered into with Messrs Pawelek and Psencik and Ms. Spurlock is qualified in its entirety by reference to the complete terms of such agreements, the forms of which have been filed with the SEC.

Stock Options

Upon consummation of the Securities Exchange, we will grant to each of Messrs. Pawelek and Psencik and to Ms. Spurlock options to purchase 17,134,555 shares of our common stock (subject to adjustment to reflect the reverse stock split). See “The 2007 Non-Qualified Stock Option Plan.”

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Interest of Longview and Viking

The purpose of the reverse stock split is to enable and facilitate the Securities Exchange by reducing the issued and outstanding number of our common stock and correspondingly increasing the authorized but unissued number of common stock. Longview, the beneficial owner of approximately 57.8% of our common stock, provided financing to Sonterra in connection with the Sonterra Acquisitions and received fees in connection with the financing to Sonterra. Longview will also be a party to the Securities Exchange that the reverse stock split is intended to facilitate. Longview will hold the Initial Note that we will issue in exchange for the Sonterra Non-Equity Note and we will have the right to require that Longview purchase up to $8 million additional aggregate principal amount of such Notes. The Notes bear interest at the 3-month LIBOR rate, as defined in the Notes, plus 8.25%, and Longview will also receive fees for the purchase of Additional Notes. For additional information regarding the terms of the Notes, see “The Securities Exchange -- Additional Terms Under the Notes.” As a result of the Sonterra Acquisitions and the Securities Exchange, Longview will receive a security interest in all of our assets and our subsidiaries now owned or to be acquired in the future, other than those of the Insurance Subsidiaries. For at least two years following the closing of the Securities Exchange, Longview will have the right to participate up to 50% in all our financings. We will also be obligated to file a registration statement covering the shares of common stock issuable upon exercise of the Warrants and Longview will also receive demand and piggyback registration rights for our common stock that it will receive in the Securities Exchange.

In addition, after the completion of the Securities Exchange, Longview is expected to beneficially own approximately 93.7% of the total outstanding shares of our common stock and will be able to exercise absolute control over all our corporate decisions, and its affiliate, LFI, will own an additional 1.3% of our common stock. Viking may be deemed to be the beneficial owner of the shares of our common stock owned by Longview and LFI. See “Reverse Stock Split At a Ratio of at Least 1-for-5 and up to 1-for-20 -- Control by Viking” and “Security Ownership of Certain Beneficial Owners and Management.”

EXECUTIVE COMPENSATION

The following table sets forth information about the remuneration of our executive officers for our last completed fiscal year. For information regarding compensation to be payable to the Principals in their respective capacities as our executive officers after the Securities Exchange, see “Interest of Certain Persons in the Reverse Stock Split and the Securities Exchange – Employment Agreements.”

SUMMARY COMPENSATION TABLE

Name and principal position	Year	Salary(US$)	Total (US$)
Howard Taylor,	2006	198,000	198,000
Chief Executive Officer (1)
Richard Freer,	2006	18,000	18,000
Secretary

(1) We paid management and administrative fees totaling $198,000 to Concorde Capital Limited, a company 100% owned by Howard Taylor, for the year ended December 31, 2006. A total of $147,333 was due to Concorde Capital Limited as of December 31, 2006.

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OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2006

	Option Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable	Option Exercise Price ($)	Option Expiration Date
(a)	(b)	(e)	(f)
Howard Taylor,	50,000	$2.00⁽¹⁾	February 5, 2009⁽¹⁾
Chief Executive Officer	200,000	$0.50⁽¹⁾	October 31, 2007⁽¹⁾
William Dickie,	100,000	$2.00⁽²⁾	February 5, 2009⁽²⁾
Former Chief Financial Officer	100,000	$0.50⁽²⁾	October 31, 2007⁽²⁾
Richard Freer, Secretary	25,000	$2.00⁽³⁾	February 5, 2009⁽³⁾

(1)	All options held by Mr. Taylor were cancelled in June 2007 without payment of any compensation to Mr. Taylor.

(2)	All options held by Mr. Dickie were cancelled in June 2007 without payment of any compensation to Mr. Dickie.

(3)	All options held by Mr. Freer were cancelled in June 2007 without payment of any compensation to Mr. Freer.

EQUITY COMPENSATION PLANS

The following table sets forth information regarding our equity compensation plans at December 31, 2006 (without giving effect to the reverse stock split). For information regarding our 2007 Plan and the options to be granted under the 2007 Plan to the Principals, who will be our executive officers after the closing of the Securities Exchange, see “The 2007 Non-Qualified Stock Option Plan.”

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights	Weighted average exercise of outstanding options, warrants and rights	Number of securities remaining available for future issuance
Equity compensation plans approved by security holders(1)	625,000(1)	$1.16	150,000(1)
Equity compensation plan not approved by security holders	0	--	0
Total	625,000(1)	$1.16	150,000(1)

(1) We adopted a stock option plan in 2004. On June 13, 2007, the 2004 Stock Option Plan and the outstanding options issued under the 2004 Stock Option Plan were cancelled. There will be no further awards under the plan.

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Director Compensation

We did not pay any compensation to our directors for their services as such for the year ended December 31, 2006.

COMPANY CORPORATE GOVERNANCE

Director Independence

Our common stock trades on the OTC Bulletin Board. As such, we are not currently subject to corporate governance standards applicable to companies listed on national securities exchanges, which require, among other things, that the majority of the board of directors of a listed company be independent.

Since we are not currently subject to corporate governance standards relating to the independence of our directors, we have chosen to define an “independent” director in accordance with the American Stock Exchange’s requirements for independent directors. The American Stock Exchange independence definition includes a series of objective tests, such as that the director is not an employee of the company or any of its subsidiaries and has not engaged in various types of business dealings with the company. We currently do not have any independent directors under the above definition.

We currently do not have an audit committee, compensation committee, nominating committee, executive committee of our Board of Directors, stock plan committee or any other committees. We do not have an audit committee financial expert.

As discussed above under “Reverse Stock Split At a Ratio of At Least 1-for-5 and up to 1-for-20,” the reverse stock split could facilitate the listing of our common stock on a national securities exchange, such as the American Stock Exchange or NASDAQ. We will become subject to the governance rules of any stock exchange on which our common stock may be listed in the future. However, the rules of many such exchanges, including the American Stock Exchange and NASDAQ, provide that a controlled company (i.e., a company more than 50% of whose voting power is held by an individual, a group or another company) is exempt from certain of such governance rules, including the requirement that the company’s board consist of a majority of independent directors and that executive compensation and nominations of directors be determined by independent directors. We are and, after the reverse stock split and Securities Exchange will continue to be, a controlled company and we therefore believe that we will be entitled to rely on these exemptions upon any listing our common stock on a stock exchange providing such exemptions.

Code of Ethics

We have not adopted a code of ethics that applies to our principal executive officer, principal financial officer, and principal accounting officer or controller, or persons performing similar functions, since we have been focusing our efforts on obtaining financing. We expect to adopt a code of ethics promptly after the completion of the Securities Exchange.

Conflicts of Interest

Our officers and directors are now and may in the future become stockholders, officers or directors of other companies, which may be formed for the purpose of engaging in similar business activities. Accordingly, additional direct conflicts of interest may arise in the future with respect to such individuals acting on behalf of us or other entities. Moreover, additional conflicts of interest may arise with respect to opportunities, which come to the attention of such individuals in the performance of their duties or otherwise. Currently, we do not have a right of first refusal pertaining to opportunities that come to their attention and may relate to our business operations.

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Our officers and directors are presently subject to the restriction that all opportunities contemplated by our plan of operation that come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available to us and the companies with which they are affiliated on an equal basis. A breach of this requirement will be a breach of the fiduciary duties of the officer or director. If we or the companies with which the officers and directors are affiliated both desire to take advantage of an opportunity, then said officers and directors would abstain from negotiating and voting upon the opportunity. However, all directors may still individually take advantage of opportunities if we should decline to do so. Except as set forth above, we have not adopted any conflict of interest policy.

The employment agreements to be entered into between us and each of the Principals upon consummation of the Securities Exchange provide that the employee’s appropriation of a corporate opportunity or material corporate asset constitutes grounds for termination for “cause.”

Nomination of Directors

As required under our Bylaws, nominations for election to the Board of Directors must be made by the Board of Directors or by any stockholder of any outstanding class of our capital stock entitled to vote for the election of directors. Nominations made by the stockholders must be preceded by notification in writing received by the our Secretary not less than 20 days nor more than 60 days prior to any meeting called for the election of directors. Such notification shall contain the written consent of each proposed nominee to serve as a director if so elected. Along with the nomination, certain information required by our Bylaws regarding each nominee, the proposing stockholders and any persons financing or directing such nomination must be provided to us.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

We paid Concorde Capital Limited, a company 100% owned by our current Chief Executive Officer and director, Howard Taylor, management and administrative fees totaling of $198,0000 for the year ended December 31, 2006. We also reimbursed Concorde Capital Limited $35,083 for out of pocket expenses for the year ended December 31, 2006. As of December 31, 2006, a total of $147,333 was outstanding and due to Concorde Capital Limited. We further paid to Concorde Capital Limited management and administrative fees totaling $120,000 for the six months ended June 30, 2007. We paid to Concorde Capital Limited an additional $1,891 as reimbursement of direct out of pocket expenses for the six months ended June 30, 2007. A total of $222,333 was due to this company as of June 30, 2007. These services were provided for fees that could be obtained from unrelated parties for the same amounts. These fees were paid to Concorde pursuant to a service agreement between us an Concorde and, upon completion of the Securities Exchange, the remaining fees payable for the balance of the term of that agreement ($100,000 at August 1, 2007) will become payable.

We paid Cognate Engineering Services Inc., a company 100% owned by our director William Dickie, management and administrative fees totaling of $4,000 for the year ended December 31, 2006.

For a description of the Securities Exchange with Longview, current owner of 57.8% of our common stock, and related matters, see “The Securities Exchange” and “Interest of Certain Persons in the Reverse Stock Split and Securities Exchange” in this Information Statement. In connection with the financing Longview provided for the Sonterra Acquisitions, Sonterra reimbursed Longview for its expenses incurred in connection with the Sonterra SPA, the related transaction documents and consummation of the transactions contemplated by those documents, and Longview received a fee of 1% of the principal amount of the Sonterra Non-Equity Note.

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Each of Messrs. Pawelek and Psencik and Ms. Spurlock will become an executive officer, and Mr. Pawelek will become the sole director, of our company upon consummation of the Securities Exchange. Each of them will enter into an employment agreement with us and will receive options to purchase 17,134,555 shares of our common stock, subject to adjustment to reflect the reverse split of our common stock. For descriptions of such employment agreements and options, see “Interest of Certain Persons in the Reverse Stock Split and the Securities Exchange – Employment Agreements” and “The 2007 Non-Qualified Stock Option Plan.”

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Compliance with Section 16(a) of the Exchange Act requires our officers and directors, and persons who own more than ten percent of our common stock to file reports of ownership and changes in ownership with the SEC. Officers, directors and greater than ten percent stockholders are required by SEC regulations to furnish us with copies of all Section 16 (a) forms they file. Based solely on a review of the copies of such forms furnished to us during, and with respect to, the year ending December 31, 2006, other than described below, we believe that during such fiscal year all Section 16(a) filing requirements applicable to our officers, directors and greater than ten percent beneficial owners were in compliance with Section 16(a).

Longview, which currently holds approximately 57.8% of our outstanding common stock, filed a Form 5 dated March 6, 2007 reporting the sale of 12,500 shares of our common stock on April 11, 2006 and the acquisitions of 11,054,474 shares of our common stock from conversion of certain convertible notes it owned and 925,000 shares of our common stock from exercise of warrants, respectively, on December 21, 2006. Longview failed to filed the required Form 4 for each of the above described transactions within two business days after the completion of the transactions as required by the rules promulgated under Section 16(a) of the Exchange Act. In addition, Longview failed to file a Form 3 when it first became a 10% stockholder and was late in filing its Form 5 for 2006.

ADDITIONAL INFORMATION

We are subject to the informational requirements of the Exchange Act and in accordance with the requirements thereof, file reports, proxy statements and other information with the Commission. Copies of these reports, proxy statements and other information can be obtained at the SEC’s public reference facilities at 100 F Street, Room 1580, Washington, D.C. 20549. Additionally, these filings may be viewed at the SEC’s website at http://www.sec.gov.

DISTRIBUTION OF INFORMATION STATEMENT

The cost of distributing this Information Statement has been borne by us and certain stockholders that consented to the action taken herein. The distribution will be made by mail.

	By Order of the Board of Directors

November , 2007	/s/ Howard Taylor
	Howard Taylor
	CHIEF EXECUTIVE OFFICER

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TABLE OF CONTENTS

INDEX TO FINANCIAL STATEMENTS

; Page
Certain Acquired Oil and Gas Properties

Audited Financial Statements

Report of Independent Registered Public Accounting Firm ; F-1 Balance Sheets as of August 3, 2007 ; F-2

Statements of Operations for the period for the period of January 1, 2007 to August 3, 2007 F-3

Statement of Equity for the period for the period of January 1, 2007 to August 3, 2007 F-4

Statement of Cash Flows for the period of January 1, 2007 to August 3, 2007 F-5

Notes to Audited Financial Statements ; F-6

Report of Independent Registered Public Accounting Firm ; F-10

Balance Sheets as of December 31, 2006 and December 31, 2005 F-11

Statements of Operations for the years ended December 31, 2006 and December 31, 2005 F-12

Statements of Equity for the years ended December 31, 2006 and December 31, 2005 F-13

Statements of Cash Flows for the years ended December 31, 2006 and December 31, 2005 F-14

Notes to Audited Financial Statements ; F-15

Sonterra Resources, Inc.

Audited Financial Statements

Report of Independent Registered Public Accounting Firm ; F-20

Balance Sheet as of September 30, 2007 ; F-21

Statement of Operations for the period from April 17, 2007 (inception) to September 30, 2007 F-22

Statement of Stockholders’ Equity (Deficit) for the period from April 17, 2007 (inception) to September 30, 2007 F-23

Statement of Cash Flows for the period from April 17, 2007 (inception) to September 30, 2007 F-24

Notes to Audited Financial Statements ; F-25

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Management of Sonterra Resources, Inc.

Certain Acquired Oil and Gas Properties

San Antonio, Texas

We have audited the balance sheet of Certain Acquired Oil and Gas Properties (see Note A for a full description) as of August 3, 2007 and the related statement of operations, equity and cash flows for the period of January 1, 2007 to August 3, 2007. These financial statements are the responsibility of the properties management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence which supports the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Certain Acquired Oil and Gas Properties as of August 3, 2007, and the results of its operations and cash flows for the period then ended in conformity with U.S. generally accepted accounting principles.

/s/ Akin, Doherty, Klein & Feuge, P.C.

[Missing Graphic Reference]

Akin, Doherty, Klein & Feuge, P.C.

San Antonio, Texas

November 21, 2007

F-1

CERTAIN ACQUIRED OIL AND GAS PROPERTIES
Balance Sheet

				August 3, 2007
ASSETS
Oil and gas properties (full cost method of accounting)
	Unproved properties			$ 462,609
	Proved properties			6,207,894
	Pipelines and facilities, net of impairment			1,426,000
		Total oil and gas properties		8,096,503
	Less accumulated depreciation, depletion and amortization			(4,155,773)
			Total oil and gas properties, net	3,940,730

Total Assets				$ 3,940,730

LIABILITIES AND EQUITY
Noncurrent Liabilities
	Asset retirement obligations			$ 103,311
		Total noncurrent liabilities		103,311

Equity				3,837,419

Total Liabilities and Equity				$ 3,940,730

*See notes to audited financial statements.*

F-2

CERTAIN ACQUIRED OIL AND GAS PROPERTIES
Statement of Operations


			January 1, 2007
			to
			August 3, 2007

Revenues
	Oil and gas sales		$ 1,883,900
	Other income		88,539
		Total revenues	1,972,439

Costs And Expenses
	Lease operating expenses		730,335
	Production taxes		123,885
	Gas gathering operations		6,563
	Depreciation, depletion and amortization		584,013
	General and administrative		71,800
		Total costs and expenses	1,516,596

Income from Operations			455,843

Income tax expense			173,220

Net Income			$ 282,623


*See notes to audited financial statements.*

F-3

CERTAIN ACQUIRED OIL AND GAS PROPERTIES
Statement of Equity




Balance at January 1, 2007		$ 4,190,997
	Net distributed equity	(636,201)
	Net income for the period	282,623

Balance at August 3, 2007		$ 3,837,419


*See notes to audited financial statements.*

F-4

CERTAIN ACQUIRED OIL AND GAS PROPERTIES
Statement of Cash Flows


			January 1, 2007
			to
			August 3, 2007

Operating Activities
	Net income		$ 282,623
	Adjustments to reconcile net loss to net cash provided by operating activities:
		Depreciation, depletion and amortization	576,184
		Asset retirement accretion	7,829
Net cash provided by operating activities			866,636

Investing Activities
	Purchases and development of oil and gas properties		(230,435)
Net cash used by investing activities			(230,435)

Financing Activities
	Distributed equity		(636,201)
Net cash used by financing activities			(636,201)

Net Increase in Cash and Equivalents			-

Cash and equivalents at beginning of period			-

Cash and Equivalents at End of Period			$ -

*See notes to audited financial statements.*

F-5

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Notes to Audited Financial Statements

August 3, 2007

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Operations: These financial statements include only those oil and gas properties acquired by Sonterra Resources, Inc. (Sonterra) in August 2007 and in connection with its planned common stock securities exchange with River Capital Group, Inc. (RCGI). Specifically, the oil and gas properties included in these financial statements, all located in Matagorda Bay, Texas, are as follows:

Purchased by Sonterra on August 3, 2007 from Cinco Natural Resources Corporation (Cinco):

60% of Cinco’s interest (63.00% working interest and 49.77% net revenue interest) in the Matagorda Bay 150 #1 producing gas well and the related 320 acre tract leased from the State of Texas.

60% of Cinco’s interest (50.50% working interest and 39.26% net revenue interest) in the Matagorda Bay 150 #2 producing gas well and the related 320 acre tract leased from the State of Texas.

Certain other tracts leased from the State of Texas, none of which currently have any production.

Purchased by Sonterra on August 29, 2007 from Flash Gas & Oil, Southwest, Inc. (Flash):

100% of Flash’s interest (35.99% working interest and 27.65% net revenue interest) in the Matagorda Bay 150 #1 producing gas well.

100% interest in the 7.3 mile pipeline connecting the Matagorda Bay 150 #1 and 150 #2 to the Keller Bay Facility onshore, located in Calhoun County, Texas.

The costs of the acquired properties as presented on the balance sheet represent the historical cost of the specified acquired properties. Revenues and direct expenses (lease operating, production taxes and pipeline operations) are based on historical data for each respective property. Depreciation, depletion and amortization (DD&A) was computed based on the historical DD&A rates of each seller, and applied to the properties acquired. General and administrative expenses attributable to the certain acquired oil & gas properties on the statements of operations are determined based on the pro-rata allocation of the seller’s total general and administrative expenses to the capitalized oil and gas property costs acquired by Sonterra as a percentage of the seller’s total capitalized oil and gas property costs. Management believes the costs and operations of the acquired properties are reasonable and appropriate.

Periods Presented: The balance sheet as of August 3, 2007 presents the historical cost basis of the oil and gas properties, and related liabilities, immediately preceding their being acquired by Sonterra. The statement of operations presents the results of operations of the oil and gas properties for the period of January 1, 2007 to August 3, 2007.

Revenue Recognition: The Sellers (Cinco and Flash) recognize oil and gas revenue from their interest in producing wells as the oil and gas is sold to third parties. Sales taxes billed are reported directly as a liability to the taxing authority, and are not included in revenue.

Oil and Gas Properties: Oil and gas properties are stated at historical cost using the full-cost method of accounting. Under this method, all costs associated with acquisition, exploration, and development of oil and gas properties are capitalized. Costs capitalized include acquisition costs, geological and geophysical expenditures, lease rentals on undeveloped properties and costs of drilling and equipping productive and non-productive wells. Drilling costs include directly related overhead costs. Capitalized costs are categorized either as being subject to amortization or not subject to amortization.

All capitalized costs of oil and gas properties, including the estimated future costs to develop proved reserves and estimated future costs to plug and abandon wells and costs of site restoration, are amortized on the unit-of-production method using estimates of proved reserves as determined by independent engineers. Investments in unproved properties and major development projects are not amortized until proved reserves associated with the projects can be determined or until impairment occurs. If the results of an assessment indicate that the properties are impaired, the amount of the impairment is added to the capitalized costs to be amortized.

In addition, capitalized costs, less accumulated amortization and related deferred income taxes, shall not exceed an amount (the full cost ceiling) equal to the sum of:

the present value of estimated future net revenues computed by applying current prices of oil and gas reserves to estimated future production of proved oil and gas reserves, less estimated future expenditures (based on current costs) to be incurred in developing and producing the proved reserves computed using a discount factor of ten percent and assuming continuation of existing economic conditions:

2)	plus the cost of properties not being amortized;

F-6

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Notes to Audited Financial Statements

August 3, 2007

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

3)	plus the lower of cost or estimated fair value of unproven properties included in the costs being amortized;

4)	less income tax effects related to the differences between the book and tax basis of the properties.

Sales of proved and unproved properties are accounted for as adjustments of capitalized costs with no gain or loss recognized, unless such adjustments would significantly alter the relationship between capitalized costs and proved reserves of oil and gas, in which case the gain or loss is recognized in income.

Income Taxes: The net income reported by the certain acquired oil and gas properties in these financial statements does not represent the results of operations of a taxable entity. However, an income tax provision is recorded on the statements of operations using a rate of 34% for federal income taxes and 3% for state income taxes, resulting in a 37% total effective tax rate. The actual tax rate of the properties, following their acquisition by Sonterra, is expected to approximate this total tax rate.

Asset Retirement Obligations: The estimated future costs for known environmental remediation requirements are accrued when it is probable that the liability has been incurred and the amount of remediation costs can be reasonably estimated. This generally occurs when the well is completed for production.

Use of Estimates: The preparation of financial statements in conformity with U. S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates that may significantly impact the financial statements include reserves, depletion, and impairment on oil and gas properties.

Concentration of Credit Risk: All of the oil and gas properties included in these financial statements are located in Matagorda Bay, Texas.

Governmental Regulations: These operations are subject to federal, state and local provisions regulating the discharge of materials into the environment. Management believes that its current practices and procedures for the control and disposition of such wastes substantially comply with applicable federal and state requirements.

NOTE B – ASSET RETIREMENT COSTS AND OBLIGATIONS

An asset retirement obligation of $103,311 as of August 3, 2007 is provided, to reflect the Company’s legal obligations related to future plugging and abandonment of its wells.

The following is a reconciliation of the asset retirement obligation for the period presented in the Balance Sheet:

	January 1, 2007 to August 3, 2007

Balance, beginning of period	$	95,906
Liabilities incurred		—
Liabilities, change in estimate		(424	)
Liabilities settled and / or disposed		—
Accretion expense		7,829
Balance, end of period	$	103,311

F-7

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Notes to Audited Financial Statements

August 3, 2007

NOTE C – OIL AND GAS PRODUCING ACTIVITIES AND PROPERTIES (UNAUDITED)

The estimates of the Company’s proved reserves and related future net cash flows that are presented in the following tables are based upon estimates made by independent petroleum engineering consultants. The reserve information was prepared as of December 31, 2006. Prior period quantities were computed based on the December 31, 2006 reserve information, rolled back for actual production and sales information. Accordingly, there are no “revisions of previous engineering estimates”. There are many inherent uncertainties in estimating proved reserve quantities, projecting future production rates, and timing of development expenditures. Accordingly, these estimates are likely to change as future information becomes available. Proved developed reserves are the estimated quantities of crude oil, condensate, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions.

Changes in estimated net quantities of conventional oil and gas reserves, all of which are located within the United States, are as follows:


	Year Ended December 31
	2006			2005
Proved developed and undeveloped reserves:
Natural gas (mcf):
Beginning of period		2,760,975			2,011,223
Extensions and discoveries		—			941,156
Reserves purchased		—			—
Sales volumes		(489,138	)		(191,404	)
Revisions of previous engineering estimates		—			—
Reserves transferred		—			—
End of period reserve quantities		2,271,837			2,760,975
Crude oil (Bbl):
Beginning of period		111,987			85,750
Extensions and discoveries		—			34,095
Reserves purchased		—			—
Sales volumes		(21,028	)		(7,858	)
Revisions of previous engineering estimates		—			—
Reserves transferred		—			—
End of period reserve quantities		90,959			111,987
Proved developed reserves:
Natural gas (mcf):
Beginning of period		1,694,089			944,337
End of period		1,204,951			1,694,089
Crude oil (Bbl):
Beginning of period reserve quantities		66,995			40,758
End of period reserve quantities		45,967			66,995

F-8

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Notes to Audited Financial Statements

August 3, 2007

NOTE C – OIL AND GAS PRODUCING ACTIVITIES AND PROPERTIES (UNAUDITED) - continued

The following table sets forth a standardized measure of the estimated discounted future net cash flows attributable to the Company’s proved developed and undeveloped oil and gas reserves. Prices used to determine future cash inflows were based on the December 31, 2006 period end price for the proved developed reserves of $5.64 per mcf of gas and $57.75 per barrel of oil. The future production and development costs represent the estimated future expenditures to be incurred in developing and producing the proved reserves, assuming continuation of existing economic conditions. Future income tax expense was estimated at 35% for combined federal and state rate.


	Year Ended December 31
	2006			2005
Future cash inflows	$	17,219,147		$	21,941,787
Future production and development costs		(8,091,886	)		(9,724,885	)
Future income tax expense		(3,408,328	)		(4,471,808	)
Future net cash flows		5,718,933			7,745,094
10% annual discount to reflect timing of net cash flows		(2,083,707	)		(2,822,525	)
Standardized measure of discounted future net cash flows relating to proved reserves	$	3,635,226		$	4,922,569

The principal factors comprising the changes in the standardized measure of discounted future net cash flows are as follows:


	Year Ended December 31
	2006			2005
Standardized measure, beginning of period	$	4,922,569		$	2,636,301
Extensions and discoveries		—			3,877,253
Reserves purchased		—			—
Development costs incurred		115,879			524,410
Sales and transfers, net of production costs		(3,205,520	)		(1,145,372	)
Revisions in quantity and price estimates		—			—
Net change in income taxes		1,063,480			(1,086,445	)
Accretion of discount		738,818			116,422
Standardized measure, end of period	$	3,635,226		$	4,922,569

F-9

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Management of Sonterra Resources, Inc.

Certain Acquired Oil and Gas Properties

San Antonio, Texas

We have audited the balance sheets of Certain Acquired Oil and Gas Properties (see Note A for a full description) as of December 31, 2006 and 2005 and the related statements of operations, equity and cash flows for the years then ended. These financial statements are the responsibility of the properties management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with Standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence which supports the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Certain Acquired Oil and Gas Properties as of December 31, 2006 and 2005, and the results of its operations and cash flows for the years then ended in conformity with U.S. generally accepted accounting principles.

As discussed in Note D to the financial statements, these financial statements have been restated for the impairment in value of the Company’s pipeline, as well as to properly reflect general and administrative expenses and income taxes related to the Company’s operations.

/s/ Akin, Doherty, Klein & Feuge, P.C.
Akin, Doherty, Klein & Feuge, P.C.
San Antonio, Texas
November 1, 2007

F-10

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Balance Sheets

	December 31,
	2006			2005
	(restated)
ASSETS
Oil and Gas Properties (full-cost method):
Unproved properties	$	454,000		$	449,562
Proved properties		5,986,492			5,871,483
Pipeline, net of impairment		1,426,000			2,756,000
Total oil and gas properties		7,866,492			9,077,045
Less accumulated depreciation, depletion, and amortization		(3,579,589	)		(2,076,440	)
Total oil and gas properties, net		4,286,903			7,000,605
Total Assets	$	4,286,903		$	7,000,605
LIABILITIES AND EQUITY
Long-Term Liabilities:
Asset retirement obligations	$	95,906		$	85,428
Total long-term liabilities		95,906			85,428
Equity		4,190,997			6,915,177
Total Liabilities and Equity	$	4,286,903		$	7,000,605

See notes to audited financial statements.

F-11

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Statements of Operations

	Year Ended December 31,
	2006		2005
	(restated)		(restated)
Revenues
Oil and gas sales	$	4,722,640	$	2,155,586
Other income		168,002		115,346
Total revenues		4,890,642		2,270,932
Costs and Expenses
Lease operating expenses		1,210,208		863,829
Production taxes		306,912		146,385
Pipeline operating expense		5,080		—
Depreciation, depletion, and amortization		1,514,496		627,660
Impairment of pipeline		1,330,000		—
General and administrative		216,000		210,000
Total costs and expenses		4,582,696		1,847,874
Income from Operations		307,946		423,058
Income tax expense		117,019		160,762
Net Income	$	190,927	$	262,296

See notes to audited financial statements.

F-12

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Statements of Equity

Balance at January 1, 2005	$	5,529,510
Net contributed equity, restated		1,123,371
Net income for the year, restated		262,296
Balance at December 31, 2005		6,915,177
Net distributed equity, restated		(2,915,107	)
Net income for the year, restated		190,927
Balance at December 31, 2006, restated	$	4,190,997

See notes to audited financial statements.

F-13

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Statements of Cash Flows

	Year Ended December 31,
	2006			2005
	(restated)			(restated)
Operating Activities
Net income	$	190,927		$	262,296
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, and amortization		1,503,149			616,339
Impairment of pipeline		1,330,000			—
Asset retirement accretion		11,347			11,321
Net cash provided by operating activities		3,035,423			889,956
Investing Activities
Purchases and development of oil and gas properties		(120,316	)		(2,013,327	)
Net cash (used) by investing activities		(120,316	)		(2,013,327	)
Financing Activities
Contributed equity		—			1,123,371
Distributed equity		(2,915,107	)		—
Net cash provided (used) by financing activities		(2,915,107	)		1,123,371
Net change in cash		—			—
Cash and cash equivalents at beginning of year		—			—
Cash and Cash Equivalents at End of Year	$	—		$	—
Supplemental Disclosures
Interest paid in cash	$	N/A		$	N/A
Federal income taxes paid in cash		N/A			N/A

See notes to audited financial statements.

F-14

CERTAIN ACQUIRED OIL AND GAS PROPERTIES

Notes to Audited Financial Statements

December 31, 2006 and 2005