AMENDMENT TO PURCHASE AND SALE AGREEMENT
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BETWEEN HI-PRO PRODUCTION, LLC, AS SELLER
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AND ROCKY MOUNTAIN, GAS, INC., AS BUYER
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DATED DECEMBER 18, 2003
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THIS AMENDMENT TO PURCHASE AND SALE AGREEMENT BETWEEN HI-PRO PRODUCTION,
LLC, AS SELLER, AND ROCKY MOUNTAIN GAS, INC., AS BUYER is dated effective this
30th day of December, 2003.
WITNESSETH, that
WHEREAS, the Parties entered into that certain Agreement for Purchase and
Sale dated December 18, 2003, and wish to amend the same; and
WHEREAS, in light of gas quality issues, as well as the likelihood for
additional gathering, compression and transmission costs related to Hi-Pro's
properties, the parties desire to enter into this Amendment.
NOW, THEREFORE, it is agreed by and between the Parties as follows:
1. Paragraph 2.1 of the Agreement for Purchase and Sale stating the basic
amount of the Purchase Price, shall be amended in its entirety to state as
follows:
The Purchase Price for the Gas Properties, subject to
adjustment as provided in Section 2.2, shall be $7 million
(the "Purchase Price"), of which the Buyer has made a down
payment of $375,000 into escrow in accordance with Section
2.1.1, leaving a remaining Purchase Price to be paid at
Closing of $6,625,000, consisting of 100,000 common shares
of U.S. Energy Corp., 233,333 shares of unregistered stock
in Buyer and cash in the sum of $5,625,000. The remaining
Purchase Price as adjusted pursuant to Section 2.2 is
referred to in this Agreement as the "Adjusted Purchase
Price".
2. Paragraph 2.1.2 "Conversion of Seller's Common Stock" shall be amended
to state as follows:
The 233,333 shares of Buyer's common stock shall be
convertible, after November 1, 2004, and for a period of two
(2) years thereafter, in whole or in part, at the option of
Seller, into shares of common stock of U.S. Energy Corp.
valued at $700,000 for the entire 233,333 shares of Buyer
using the ten-day's average closing price of U.S. Energy
Corp. shares prior to such election. At the election of U.S.
Energy Corp., it may pay Seller cash for such shares as to
which Seller has elected to convert to U.S. Energy Corp.
shares. Seller's right to convert shares of Buyer to U.S.
Energy Corp. shares shall be limited to conversions valued
at $50,000, or more, of U.S. Energy Corp. shares in any
single transaction.
3. There shall be added a new Paragraph 2.1.3 entitled "Registration of
U.S. Energy Shares", as follows:
U.S. Energy Corp. shall file a registration statement for
the 100,000 shares of U.S. Energy Corp. common stock in
order that the Buyer may, at its option, sell the same in
the public market, within ninety (90) days after the
Closing, at the sole cost and expense of U.S. Energy Corp.
4. There shall be added a new Paragraph 9.2 "Extension", as follows:
Notwithstanding anything herein to the contrary, the Closing
may, at the option of the Buyer, be extended to February 6,
2004, provided, however, that on or before January 30, 2004,
Buyer shall give Seller written notice thereof and shall pay
to Seller the sum of $75,000 as a non-refundable fee for
extension of the Closing date, such sum not to be a credit
against the Purchase Price.
5. Except as amended by this Agreement, the Parties re-affirm their
Agreement for Purchase and Sale dated December 18, 2003.
6. This Agreement may be signed in counterpart and exchanged via facsimile.
DATED this 30th day of December, 2003.
SELLER: HI-PRO PRODUCTION, LLC
BY: /s/ Steven R. Youngbauer
STEVEN R. YOUNGBAUER - PRESIDENT
BUYER: ROCKY MOUNTAIN GAS, INC.
BY: /s/ Mark Larsen
MARK LARSEN - PRESIDENT
U.S. ENERGY CORP.
BY: /s/ Keith Larsen
KEITH LARSEN - PRESIDENT