PART II AND III

Preliminary Offering Circular dated August 28, 2017

An Offering Statement pursuant to Regulation A relating to these securities has been filed with the Securities and Exchange Commission. Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the Offering Statement filed with the Commission is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the Offering Statement in which such Final Offering Circular was filed may be obtained.

Preliminary Offering Circular

Subject to Completion. Dated August ____, 2017

American Energy Partners, Inc.

$10,000,000

200,000,000 SHARES OF COMMON STOCK

$0.05 PER SHARE

This is the initial public offering of securities of American Energy Partners, Inc., a Colorado corporation. We are offering 200,000,000 shares of our common stock, par value $0.001 (“Common Stock”) at an offering price of $.05 per share (the “Offered Shares”). This Offering will terminate on twelve months from the day the Offering is qualified, subject to extension for up to thirty (30) days as defined below or the date on which the maximum offering amount is sold (such earlier date, the “Termination Date”). If, on the initial closing date, we have sold less than the maximum number of Offered Shares, then we will hold one or more additional closings for additional sales, until the earlier of: (i) the sale of the maximum number of Offered Shares or (ii) the Termination Date. The minimum purchase requirement per investor is 20,000 Offered Shares ($1,000); however, we can waive the minimum purchase requirement on a case-by-case basis in our sole discretion.

These securities are speculative securities. Investment in the Company’s stock involves significant risk. You should purchase these securities only if you can afford a complete loss of your investment. See the “Risk Factors” section on page 6 of this Offering Circular.

The offering will be at a fixed price of $0.05. The end date of the offering will be exactly 180 days from the date the Offering Circular is qualified (unless extended by the Company, in its own discretion, for up to another 180 days.

Our common stock currently trades on the Pink Open Market under the symbol “AEPT” and the closing price of our common stock on August ____, 2017 was $0._____. Our common stock currently trades on a sporadic and limited basis.

We are offering our shares without the use of an exclusive placement agent, however, we may engage various securities brokers to place shares in this offering with investors for commissions of up to 10% of the gross proceeds.

We expect to commence the sale of the shares as of the date on which the Offering Statement of which this Offering Circular is approved by the Attorney General of the state of New York.

See “Risk Factors” to read about factors you should consider before buying shares of common stock.

As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds.

Generally, no sale may be made to you in this Offering if the aggregate purchase price you pay is more than 10% of the greater of your annual income or net worth. Different rules apply to accredited investors and non-natural persons. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov

Sale of these shares will commence within two calendar days of the qualification date and it will be a continuous Offering pursuant to Rule 251(d)(3)(i)(F).

This Offering will be conducted on a “best-efforts” basis, which means our Officers will use their commercially reasonable best efforts in an attempt to offer and sell the Shares. Our Officers will not receive any commission or any other remuneration for these sales. In offering the securities on our behalf, the Officers will rely on the safe harbor from broker-dealer registration set out in Rule 3a4-1 under the Securities Exchange Act of 1934, as amended.

This Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sales of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful, prior to registration or qualification under the laws of any such state.

Investing in our Common Stock involves a high degree of risk. See “Risk Factors” beginning on page 6 for a discussion of certain risks that you should consider in connection with an investment in our Common Stock.

	Per Share		Total Maximum (2)
Public Offering Price (1)	$	0.05	$	10,000,000
Underwriting Discounts and Commissions (3)	$	0	$	0
Proceeds to Us from this Offering to the Public (Before Expenses (4))	$	0.05	$	10,000,000

(1)	We are offering shares on a continuous basis. See “Distribution – Continuous Offering.
(2)	This is a “best efforts” offering. As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds. See “How to Subscribe.”
(3)	We are offering these securities without an underwriter.
(4)	Excludes estimated total Offering expenses, including underwriting discount and commissions, will be approximately $400,000 assuming the maximum offering amount is sold.

Our Board of Directors used its business judgment in setting a value of $0.05 per share to the Company as consideration for the stock to be issued under the Offering. The sales price per share bears no relationship to our book value or any other measure of our current value or worth.

No sale may be made to you in this Offering if the aggregate purchase price you pay is more than 10% of the greater of your annual income or your net worth. Different rules apply to accredited investors and non-natural persons. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov.

THE U.S. SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.

The date of this Offering Circular is August ___, 2017.

This offering is being made on a self-underwritten basis without the use of an exclusive placement agent, however, we may engage various securities brokers to place shares in this offering with investors on a commission basis. As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds.

Management will make its best effort to fill the subscription in the state of New York. However, in the event that management is unsuccessful in raising the required funds in New York, the Company may file a post qualification amendment to include additional jurisdictions that Management has determined to be in the best interest of the Company for the purpose of raising the maximum offer. In the event that the Offering Circular is fully subscribed, any additional subscriptions shall be rejected and returned to the subscribing party along with any funds received.

In order to subscribe to purchase the shares, a prospective investor must complete a subscription agreement and send payment by check, wire transfer or ACH. Investors must answer certain questions to determine compliance with the investment limitation set forth in Regulation A Rule 251(d)(2)(i)(C) under the Securities Act of 1933, which states that in offerings such as this one, where the securities will not be listed on a registered national securities exchange upon qualification, the aggregate purchase price to be paid by the investor for the securities cannot exceed 10% of the greater of the investor’s annual income or net worth. In the case of an investor who is not a natural person, revenues or net assets for the investor’s most recently completed fiscal year are used instead. The Company has not currently engaged any party for the public relations or promotion of this offering. As of the date of this filing, there are no additional offers for shares, nor any options, warrants, or other rights for the issuance of additional shares except those described herein.

TABLE OF CONTENTS

	Page
CAUTIONARY STATMENT REGARDING FORWARD-LOOKING STATEMENTS	1
SUMMARY	2
RISK FACTORS	6
USE OF PROCEEDS	13
DILUTION	15
DISTRIBUTION	16
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	18
OUR BUSINESS	20
MANAGEMENT	27
EXECUTIVE COMPENSATION	29
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS	30
PRINCIPAL STOCKHOLDERS	30
DESCRIPTION OF SECURITIES	32
DIVIDEND POLICY	36
SHARES ELIGIBLE FOR FUTURE SALE	36
LEGAL MATTERS	36
EXPERTS	36
WHERE YOU CAN FIND MORE INFORMATION	36
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS	F-1

We are offering to sell, and seeking offers to buy, our securities only in jurisdictions where such offers and sales are permitted. You should rely only on the information contained in this Offering Circular. We have not authorized anyone to provide you with any information other than the information contained in this Offering Circular. The information contained in this Offering Circular is accurate only as of its date, regardless of the time of its delivery or of any sale or delivery of our securities. Neither the delivery of this Offering Circular nor any sale or delivery of our securities shall, under any circumstances, imply that there has been no change in our affairs since the date of this Offering Circular. This Offering Circular will be updated and made available for delivery to the extent required by the federal securities laws.

In this Offering Circular, unless the context indicates otherwise, references to “American Energy Partners, Inc.”, “we”, the “Company”, “our” and “us” refer to the activities of and the assets and liabilities of the business and operations of American Energy Partners, Inc.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements under “Summary”, “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, “Our Business” and elsewhere in this Offering Circular constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify forward-looking statements by terms such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “potential”, “should”, “will” and “would” or the negatives of these terms or other comparable terminology.

You should not place undue reliance on forward looking statements. The cautionary statements set forth in this Offering Circular, including in “Risk Factors” and elsewhere, identify important factors which you should consider in evaluating our forward-looking statements. These factors include, among other things:

● The speculative nature of the business we intend to develop;

● Our ability to successfully develop material revenue streams from our developmental activities, many of which are are close to start up and not operating at the present time.

● Our dependence upon external sources for the financing of our operations, particularly given that there are concerns about our ability to continue as a “going concern;”

● Our ability to effectively execute our business plan;

● Our ability to manage our expansion, growth and operating expenses;

● Our ability to finance our businesses;

● Our ability to promote our businesses;

● Our ability to compete and succeed in highly competitive and evolving businesses;

● Our ability to respond and adapt to changes in technology and customer behavior; and

● Our ability to protect our intellectual property and to develop, maintain and enhance strong brands.

Although the forward-looking statements in this Offering Circular are based on our beliefs, assumptions and expectations, taking into account all information currently available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made to any investor by anyone that the expectations reflected in our forward-looking statements will be attained, or that deviations from them will not be material and adverse. We undertake no obligation, other than as maybe be required by law, to re-issue this Offering Circular or otherwise make public statements updating our forward-looking statements.

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SUMMARY

This summary highlights selected information contained elsewhere in this Offering Circular. This summary is not complete and does not contain all the information that you should consider before deciding whether to invest in our Common Stock. You should carefully read the entire Offering Circular, including the risks associated with an investment in the company discussed in the “Risk Factors” section of this Offering Circular, before making an investment decision. Some of the statements in this Offering Circular are forward-looking statements. See the section entitled “Cautionary Statement Regarding Forward-Looking Statements.”

Company Information

The Company, sometimes referred to herein as “we,” “us,” “our,” and the “Company” and/or “American Energy Partners, Inc.” was incorporated originally on October 12, 2004, under the laws of the State of Nevada, to engage in any lawful corporate undertaking. Recently, the Company changed its name to American Energy Partners, Inc. and its corporate domicile to the State of Colorado. In connection with this conversion, the Company engaged in a one for 20 reverse split of the Company’s Common Stock. The trading symbol for the Common Stock was changed from “XFUL” to “AEPT.”

The Issuer’s offices are located at PO Box 443 Allentown, PA 18105., Phone: 610-217-3275, Email: Contact@americanenergy-inc.com We maintain a website at http://www.americanenergy-inc.com/ . We do not incorporate the information on or accessible through our website into this Offering Circular, and you should not consider any information on, or that can be accessed through, our website a part of this Offering Circular.

American Energy Partners, Inc. is comprised of three subsidiaries that source, treat and distribute reclaimed water in an effort to preserve our nation’s naturally occurring resources. Together with Hydration Company of PA (sourcing, distributing) and American Energy Solutions (treating), Gilbert Oil and Gas Company provides value through net revenue interests, mineral interests and royalty rights.

Hydration Company’s competitive edge lies within its pure volume of reclaimed water and its access to low cost treatment with high flow rates and highly concentrated solids through AES’s technologies. We believe that because of this volume, Hydration Company can effectively gain market share immediately as large corporations want access to one source that can supply massive amounts of reclaimed water to fulfill their input of production through Hydration’s patent pending (US 2014/0305879 A1) methodology and conveyance methods.

Through the vertical integration of these companies, we believe we can achieve higher operating profits than the industry average. This should lead to greater returns on invested capital.

Section 15(g) of the Securities Exchange Act of 1934

Our shares are covered by section 15(g) of the Securities Exchange Act of 1934, as amended that imposes additional sales practice requirements on broker/dealers who sell such securities to persons other than established customers and accredited investors (generally institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouses). For transactions covered by the Rule, the broker/dealer must make a special suitability determination for the purchase and have received the purchaser’s written agreement to the transaction prior to the sale. Consequently, the Rule may affect the ability of broker/dealers to sell our securities and also may affect your ability to sell your shares in the secondary market.

Section 15(g) also imposes additional sales practice requirements on broker/dealers who sell penny securities. These rules require a one page summary of certain essential items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important to in understanding of the function of the penny stock market, such as  bid and offer quotes, a dealers spread and broker/dealer compensation; the broker/dealer compensation, the broker/dealers’ duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers’ rights and remedies in cases of fraud in penny stock transactions; and, FINRA’s toll free telephone number and the central number of the North American Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.

Dividends

The Company has not declared or paid a cash dividend to stockholders since it was organized and does not intend to pay dividends in the foreseeable future. The Board of Directors presently intends to retain any earnings to finance our operations and does not expect to authorize cash dividends in the foreseeable future. Any payment of cash dividends in the future will depend upon the Company’s earnings, capital requirements and other factors.

Trading Market

Our Common Stock trades in the Pink Open Market under the symbol “AEPT.” The Issuer’s securities have not recently been delisted by any securities exchange. The Issuer filed a Form 15 with the Securities and Exchange Commission de-registering its Common Stock on July 17, 2009.

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BUSINESS

______

American Energy Partners, Inc. –  Our History

The Company, sometimes referred to herein as “we,” “us,” “our,” and the “Company” and/or “American Energy Partners, Inc.” was incorporated in the State of Nevada on October 12, December 29, 2006. The Company, sometimes referred to herein as “we,” “us,” “our,” and the “Company” and/or “American Energy Partners, Inc.” was incorporated originally on October 12, 2004, under the laws of the State of Nevada, to engage in any lawful corporate undertaking. Recently, the Company changed its name to American Energy Partners, Inc. and its corporate domicile to the State of Colorado. In connection with this conversion, the Company engaged in a one for 20 reverse split of the Company’s Common Stock. The trading symbol for the Common Stock was changed from “XFUL” to “AEPT.”

Our offices are located at PO Box 443 Allentown, PA 18105., Phone: 610-217-3275, Email: Contact@americanenergy-inc.com. We maintain a website at http://www.americanenergy-inc.com . We do not incorporate the information on or accessible through our website into this Offering Circular, and you should not consider any information on, or that can be accessed through, our website a part of this Offering Circular.

Our Business

American Energy Partners, Inc., Inc. is a group of companies that focus on providing solutions in the space where energy production and water meet technology.  Our subsidiaries, Hydration Corporation of PA, LLC, American Energy Solutions, and Gilbert Oil and Gas, will own energy operations as well as design, build and operate regional water treatment facilities that serve the industrial and energy sectors. 

We are a publicly-traded company listed in the Pink Open Market under the symbol AEPT. We are comprised of subsidiaries that source, treat and distribute reclaimed water in an effort to preserve our nation’s naturally occurring resources. Together with Hydration Company of PA (sourcing, distributing) and American Energy Solutions (treating), Gilbert Oil and Gas Company will provide value through net revenue interests, mineral interests and royalty rights.

Through the vertical integration of these companies, AEPT believes it can achieve higher operating profits than the industry average. This should lead to greater returns on invested capital.

Hydration Corporation of PA, LLC

______

Hydration Corporation of PA, LLC (“Hydration Company”) is engaged in the businesses of water exploration, water augmentation, and the treatment of impacted waters. Through its subsidiaries and partners, we design, build, and operate regional water treatment facilities. Hydration Company is a leader in water-neutral energy solutions, as well as providing waste water technologies specifically designed to improve the impaired water disposal process.

We believe that Hydration Company’s technology delivers one of the highest energy yields from a broad range of water-bearing assets, with one of the lowest capital expenditures of any other known water processes.

Hydration Company offers a range of low cost attractive modular systems or fixed facilities via its water conveyance methodologies, which produce low cost water solutions in partnership with select small to large-size industrial energy users, government agencies, and non-profit watershed groups in target markets.

Hydration Company provides a solution to locate, procure, treat and distribute water. This patent-pending process provides cleaner water which results in an improved, safer environment. It can also mitigate drought conditions by accessing water previously unavailable. Applications may include, but are not limited to: oil and gas, pipelines, industrial use, utilities, mining, municipalities and landowners.

Hydration Company has designed a unique, patent pending system to treat and distribute water in an efficient and economical process that should encourage treated water to be used by gas drillers, pipeline companies, utility companies, industry and municipalities.

Over time Hydration Company has gained support for our unique, patent-pending process by the Pennsylvania Department of Environmental Protection (DEP), Susquehanna River Basin Commission (SRBC), and the Pennsylvania Department of Conservation and Natural Resources (DCNR). In fact, we are currently negotiating contracts and letter of intent agreements with these organizations for mines that store our inventory.

Hydration Company conducted its first pump test that was a field demonstration at Coal Creek, Blossburg, Pennsylvania, which was granted by the Pennsylvania DEP & the SRBC. The pump test was performed through AES using GeoTube Technology which produced favorable test result. This enabled Hydration to: (1) confirm the economic model; (2) prove the validity of the business model; and (3) share the results with potential partners, customers and government agencies.

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Since that field demonstration, Hydration Company has partnered with Eastern Pennsylvania Coalition for Abandoned Mine Reclamation (EPCAMR) and the SRBC to start the first three phases of due diligence at the Mocanaqua Tunnel. This property has an estimated 500 billion gallons of storage and appears to be an excellent candidate for Hydration Company’s methodologies. This opportunity may be worth an estimated $2.5 million of construction and operation and maintenance for AES. AES would provide the treatment technologies beginning in Phase IV.

Hydration Company’s competitive edge lies within its pure volume of reclaimed water and its access to low cost treatment with high flow rates and highly concentrated solids through AES’ partners’ technologies. Because of this volume Hydration Company can effectively gain market share immediately as large corporations want access to one source that can supply massive amounts of reclaimed water to fulfill their input of production through Hydration’s patent pending (US 2014/0305879 A1) methodology and conveyance methods.

The success of the company is dependent upon effectively entering into contracts with private and state-owned mines. These contracts will give Hydration Company the sole right to distribute water from privately owned mines across the country.

The company will operate out of multiple, predetermined, selected sites within the United States and will need minimal space to conduct its office activities. The sites are all being different in terms of geography, storage and water quality. All sites will be enabled for augmentation or the ability to mitigate during pass-by conditions. Augmentation is an important factor of the equation. It allows Hydration Company to not only provide every day water but to provide additional waters to the system when low flow conditions are present. This is a valuable piece of the model because no matter how long or severe of a drought, it gives customers the ability to consume at their intake up to their maximum docketed withdrawal thus granting them pass-by exemption.

How the model works: First, hydrological studies are performed statewide to determine the largest pools of non-potable water. Second, access and control of these mines are gained through contracts with the land owner. Third, final hydrology and engineering studies performed. Next, a filtration system is installed with all needed permits. Lastly, a dynamically-adjustable, turn-key system is put online that allows Hydration to execute its model of treatment and distribution through its proprietary conveyance system.

American Energy Solutions, LLC

______

American Energy Solutions is an industrial waste stream treatment company that intends to engage in the remediation of Superfund sites, coal ash, acid mine drainage and Mine Influenced Water (MIW), drill Cuttings (horizontal direction drilling or HDD and vertical directional drilling or VDD), flowback (water and other debris that comes to the surface after a well is fracked) and produced waters, and other industrial processes. .

We provide treatment technologies that contribute to Hydration Company’s business model of low-cost treatment and distribution. These treatment technologies also allow AES to leverage existing contacts in the industrial space and convert these contacts into contract value. AES’s long-term goal is to bring waste stream treatment technologies in- house.

Gilbert Oil and Gas

______

We intend to develop Gilbert Oil as a U.S. based exploration and production company focused on generating long-term shareholder value through drilling, operating, and partnership opportunities in the upstream oil and gas space.

Gilbert’s sole service is to provide cash flow through investment in oil and gas royalties, producing wells and the development of mineral rights.

Gilbert came into existence to capitalize on the depressed asset pricing in the oil and gas space. Gilbert’s business model is to first capture royalty opportunities then gain working interests on producing wells and lastly to acquire land inventory through mineral rights.

Gilbert will concentrate its initial capital inside the Marcellus & Utica formations where we can monetize existing water assets and treatment technologies. WV, OH, PA

Following this model we are of the belief that meaningful asset and cash flow value will be derived over the course of time.

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THE OFFERING

Issuer:	American Energy Partners, Inc.
Securities offered:	A maximum of 200,000,000 shares of our common stock, par value $0.001 (“Common Stock”) at an offering price of $0.05 per share (the “Offered Shares”).
Number of shares of Class A Common Stock \ outstanding before the Offering:	8,375,822 shares of Class A Common Stock
Number of shares of Class A Common Stock  to be outstanding after the Offering:	208,375,822 shares of Class A Common Stock, if the maximum amount of Offered Shares are sold
Price per share:	$0.05
Maximum offering amount:	200,000,000 shares at $0.05 per share, or $10,000,000.
Trading Market:	Our Common Stock trades on the Pink Open Market  under the symbol “AEPT.”
Use of proceeds:	If we sell all of the shares being offered, our net proceeds (after our estimated offering expenses) will be $9,600,000. We will use these net proceeds for acquisitions and working capital and other general corporate purposes.
Risk factors:	Investing in our Common Stock involves a high degree of risk, including, but not limited to: Speculative nature of our business. Competition. Long sales lead time. Our need for more capital. Risks of government programs and regulations in our business. Risk of new technology. Immediate and substantial dilution. Limited market for our stock. Dilution. Use of Forward-Looking Statements Investors are advised to read and pay careful attention to the section on Risk Factors.

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RISK FACTORS

An investment in our Common Stock involves a high degree of risk. You should carefully consider the following risk factors, together with the other information contained in this Offering Circular, before purchasing our Common Stock. Any of the following factors could harm our business, financial condition, results of operations or prospects, and could result in a partial or complete loss of your investment. Some statements in this Offering Circular, including statements in the following risk factors, constitute forward-looking statements. Please refer to the section entitled “Cautionary Statement Regarding Forward-Looking Statements”.

Risks Relating to Our Businesses

Risks of Oil and Gas Assets

Speculative nature and hazards of oil and gas development activities.

Exploration, drilling and development of oil and gas properties is not an exact science and involves a high degree of risk. There is no assurance that our activities in the oil and gas industry will yield sufficient oil or gas production or other operating revenues that will allow us to remain profitable. We may be subject to liability for pollution and other damages and will be subject to statutes and regulations relating to environmental matters. Although we may obtain and maintain the insurance coverage and amounts we deem appropriate, we may suffer losses due to hazards against which we cannot insure or against which we may elect not to insure.

Importance of Future Prices, Supply and Demand for Oil and Gas.

Revenues generated from our oil and gas production activities in the oil and gas industry will be highly dependent upon the future prices and demand for oil and gas. Factors which may affect prices and demand for oil and gas include, but are not limited to, the worldwide supply of oil and gas; the price of oil and gas produced in the United States or imported from foreign countries; consumer demand for oil and gas; the price and availability of alternative fuels; federal and state regulation; and general, national and worldwide economic political conditions.

In addition to the widely-recognized volatility of the oil market, the gas market is also unsettled due to a number of factors. In the past, production from gas wells in many geographic areas of the United States has been curtailed for considerable periods of time due to a lack of market demand, and such curtailments may exist in the future. Further, there may be an excess supply of gas in the area of our wells. In that event, it is possible that our wells could be shut in or gas in those areas might be sold on terms less favorable than might otherwise be obtained. The combination of these factors, among others, makes it particularly difficult to estimate accurately future prices of oil and gas, and any assumptions concerning future prices may prove incorrect.

Markets for Sale of Production.

Our ability to market oil and gas found and produced, will depend on numerous factors beyond our control, the effect of which cannot be accurately predicted or anticipated. Some of these factors include, without limitation, the availability of a ready market, the effect of federal and state regulation of production, refining, transportation and sales, and general national and worldwide economic conditions. There is no assurance that we will be able to market any oil or gas we produced, or, if such oil or gas is marketed, that we can obtain favorable prices.

Price Control and Possible Energy Legislation.

There are currently no federal price controls on oil or gas production so that sales of our oil or gas can be made at uncontrolled market prices. However, there can be no assurance that Congress will not enact controls at any time. No prediction can be made as to what additional energy legislation may be proposed, if any, nor which bills may be enacted nor when any such bills, if enacted, would become effective.

Environmental Regulations.

The exploration, development and production of oil and gas is subject to various federal and state laws and regulations to protect the environment. Various states and governmental agencies are considering, and some have adopted, laws and regulations regarding environmental control which could adversely affect our business. Compliance with such legislation and regulations, together with any penalties resulting from noncompliance therewith, will increase the cost of oil and gas development and production.

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Government Regulation.

The oil and gas business is subject to extensive governmental regulation under which, among other things, rates of production from our wells may be fixed. Governmental regulation also may limit or otherwise affect the market for our wells’ production and the price which may be paid for that production. Governmental regulations relating to environmental matters could also affect our operations. The nature and extent of various regulations, the nature of other political developments and their overall effect upon us are not predictable.

Industry and geographical concentration.

We will acquire oil and gas assets, operating in one industry and in a limited geographical area with limited assets. This concentration will increase our risk. Unfavorable conditions in our markets, unfavorable events that affect our assets, or unfavorable events affecting oil and gas could materially affect us.

Price declines may result in reduced profits.

Commodity prices have a significant impact on the present value of our operations. To the extent oil and gas price declines indicate a reduction of the estimated useful life or estimated future cash flows of our assets, our assets may be impaired.

Prices and markets for oil and natural gas are unpredictable and tend to fluctuate significantly, which could reduce the value of our assets.

Oil and natural gas are commodities whose prices are determined based on world demand, supply, and other factors, all of which are beyond our control. World prices for oil and natural gas have fluctuated widely in recent years. We expect that prices will continue to fluctuate in the future. Price fluctuations will have a significant impact on our revenue, the return from our reserves and on our financial condition generally. Price fluctuations for oil and natural gas commodities may also impact the investment market for companies engaged in the oil and gas industry. Decreases in the prices of oil and natural gas may have a material adverse effect on our assets and our cash flows.

Our assets may not be insured against all of the operating hazards to which they are exposed.

Our oil and gas assets and operations are subject to the usual hazards incident to the drilling and production of oil and gas, such as windstorms, lightning strikes, blowouts, cratering, explosions, uncontrollable flows of oil, gas or well fluids (including fluids used in hydraulic fracturing activities), fires, severe weather and pollution and other environmental risks. These hazards can cause personal injury and loss of life, severe damage to and destruction of property and equipment, pollution or environmental damage, clean-up responsibilities, regulatory investigation and penalties, and suspension of operations, all of which could result in a substantial loss. We may maintain insurance against some, but not all, of the risks described above. Such insurance may not be adequate to cover losses or liabilities. Also, we cannot give assurance of the continued availability of insurance at premium levels that justify its purchase.

Technology Risks
______

Ability to develop commercial products. 

The Company presently maintains rights to a new technology. At this time, the technology has been developed. However, the product is not commercially ready for sale. In order to reach a stage of commercial sales for the product, the Company may need to put emphasis on joint venturing and funding a company who has advanced technological knowledge and progressed sales history of the same field for the purpose of cooperation. The Company cannot predict that it will be successful in developing commercially ready products for any of the technology in the near future or at any time.

Rapid technological changes. 

The industries in which the Company intends to compete with are subject to rapid technological changes. No assurances can be given that the technological advantages which may be enjoyed by the Company in respect of their technologies cannot or will not be overcome by technological advances in the respective industries rendering the Company’s technologies obsolete or non-competitive.

Lack of indications of product acceptability.

The success of the Company will be dependent upon its ability to develop commercially acceptable products and to sell such products in quantities sufficient to yield profitable results. To date, the Company has received no indications of the commercial acceptability of any of its proposed products. Accordingly, the Company cannot predict whether its products can be marketed and sold in a commercial manner.

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Reliance upon third parties. 

The Company does not intend on maintaining a significant technical staff nor does it intend on manufacturing its products. Rather it will rely heavily on consultants, contractors, and manufacturers to design, develop and manufacture its products. Accordingly, there is no assurance that such third parties will be available when needed at affordable prices.

Competition

Although management believes its products, if developed, will have significant competitive advantages to other products in their respective industries, with respect to such products, the Company will be competing in industries, such as the industrial wastewater industry, where enormous competition exists. Competitors in these industries have greater financial, engineering and other resources than the Company. No assurances can be given that any advances or developments made by such companies will not supersede the competitive advantages of the Company’s products.

Protection of intellectual property. 

The success of the Company will be dependent, in part, upon the protection of its various proprietary technologies from competitive use. Certain of its technologies are the subject of various patents in varying jurisdictions. In addition to the patent applications, the Company relies on a combination of trade secrets, nondisclosure agreements and other contractual provisions to protect its intellectual property rights. Nevertheless, these measures may be inadequate to safeguard the Company’s underlying technologies. If these measures do not protect the intellectual property rights, third parties could use the Company’s technologies, and its ability to compete in the market would be reduced significantly.

In the future, the Company may be required to protect or enforce its patents and patent rights through patent litigation against third parties, such as infringement suits or interference proceedings. These lawsuits could be expensive, take significant time, and could divert management’s attention from other business concerns. These actions could put the Company’s patents at risk of being invalidated or interpreted narrowly, and any patent applications at risk of not issuing. In defense of any such action, these third parties may assert claims against the Company. The Company cannot provide any assurance that it will have sufficient funds to vigorously prosecute any patent litigation, that it will prevail in any of these suits, or that the damages or other remedies awarded, if any, will be commercially valuable. During the course of these suits, there may be public announcements of the results of hearings, motions and other interim proceedings or developments in the litigation, which could result in the negative perception by investors, which could cause the price of the Company’s common stock to decline dramatically.

General Business Risks

Our business and operations may experience rapid growth. If we fail to manage our growth, our business and operating results could be harmed and we may have to incur significant expenditures to address the additional operational and control requirements of this growth.

We may experience rapid growth in our sales and operations, which may place significant demands on our management, operational and financial infrastructure. If we do not manage our growth, the quality of our products and services could suffer, which could negatively affect our brand and operating results. To manage this growth, we will need to continue to improve our operational, financial and management controls and our reporting systems and procedures. These systems enhancements and improvements will require significant capital expenditures and allocation of valuable management resources. If the improvements are not implemented successfully, our ability to manage our growth will be impaired and we may have to make significant additional expenditures to address these issues, which could harm our financial position. The required improvements may include: Enhancing our information and communication systems to attempt to optimize proper service to our customers, and Enhancing systems of internal controls to ensure timely and accurate reporting of all of our operations

If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential stockholders could lose confidence in our financial reporting, which would harm our business and the trading price of our stock.

Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. If we cannot provide reliable financial reports or prevent fraud, our brand and operating results could be harmed. We may in the future discover areas of our internal controls that need improvement. We cannot be certain that any measures we implement will ensure that we achieve and maintain adequate controls over our financial processes and reporting in the future. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm our operating results or cause us to fail to meet our reporting obligations. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

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We have no operating history and a relatively new business model in an emerging and rapidly evolving market. This makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful.

We have no operating history. You must consider our business and prospects in light of the risks and difficulties we will encounter as an early-stage company in a new and rapidly evolving market. We may not be able to successfully address these risks and difficulties, which could materially harm our business and operating results.

We cannot be certain that additional financing will be available on reasonable terms when required, or at all.

From time to time, we may need additional financing. Our ability to obtain additional financing, if and when required, will depend on investor demand, our operating performance, the condition of the capital markets, and other factors. We cannot assure you that additional financing will be available to us on favorable terms when required, or at all. We may need to raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences, or privileges senior to the rights of our Common Class A Stock, and our existing stockholders may experience dilution.

Risks Related to this Offering

There has been a limited public market for our Common Stock prior to this Offering, and an active market in which investors can resell their shares may not develop.

Prior to this Offering, there has been a limited public market for our Common Stock. We cannot predict the extent to which an active market for our Common Stock will develop or be sustained after this Offering, or how the development of such a market might affect the market price of our Common Stock. The initial offering price of our Common Stock in this Offering will be agreed between us and the underwriters based on a number of factors, including market conditions in effect at the time of the Offering, and it may not be in any way indicative of the price at which our shares will trade following the completion of this Offering. Investors may not be able to resell their shares at or above the initial offering price.

Investors in this Offering will experience immediate and substantial dilution.

If all of the shares offered hereby are sold, investors in this Offering will own 90.5% of the then outstanding shares of all classes of common stock, but will have paid over 99.3% of the total consideration for our outstanding shares, resulting in a dilution of $0.0063 per share. See “Dilution.”

The market price of our Common Stock may fluctuate, and you could lose all or part of your investment.

The offering price for our Common Stock will be set by us based on a number of factors, and may not be indicative of prices that will prevail on OTCMarkets or elsewhere following this Offering. The price of our Common Stock may decline following this Offering. The stock market in general, and the market price of our Common Stock will likely be subject to fluctuation, whether due to, or irrespective of, our operating results, financial condition and prospects.

Our financial performance, our industry’s overall performance, changing consumer preferences, technologies and advertiser requirements, government regulatory action, tax laws and market conditions in general could have a significant impact on the future market price of our Common Stock. Some of the other factors that could negatively affect our share price or result in fluctuations in our share price include:

● actual or anticipated variations in our periodic operating results;

● changes in earnings estimates;

● changes in market valuations of similar companies;

● actions or announcements by our competitors;

● adverse market reaction to any increased indebtedness we may incur in the future;

● additions or departures of key personnel;

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● actions by stockholders;

● speculation in the press or investment community; and

● our intentions and ability to list our Common Stock on a national securities exchange and our subsequent ability to maintain such listing.

We do not expect to declare or pay dividends in the foreseeable future.

We do not expect to declare or pay dividends in the foreseeable future, as we anticipate that we will invest future earnings in the development and growth of our business. Therefore, holders of our Common Stock will not receive any return on their investment unless they sell their securities, and holders may be unable to sell their securities on favorable terms or at all.

Our financial statements are unaudited and have not been reviewed by an independent accountant.

Management has prepared the Company’s financial statements. These statements have not been audited. No independent accountant has reviewed these financial statements.

Because we do not have an audit or compensation committee, shareholders will have to rely on our directors, none of whom is not independent, to perform these functions.

We do not have an audit or compensation committee comprised of an independent director. Indeed, we do not have any audit or compensation committee. The Board of Directors performs these functions as a whole. No members of the Board of Directors are an independent director. Thus, there is a potential conflict in that board members who are also part of management will participate in discussions concerning management compensation and audit issues that may affect management decisions.

Because we lack certain internal controls over financial reporting in that we do not have an audit committee and our Board of Directors has no technical knowledge of U.S. GAAP and internal control of financial reporting and relies upon the Company’s financial personnel to advise the Board on such matters, we are subject to increased risk related to financial statement disclosures.

We lack certain internal controls over financial reporting in that we do not have an audit committee and our Board of Directors has no technical knowledge of U.S. GAAP and internal control of financial reporting and relies upon the Company’s financial personnel to advise the Board on such matters. Accordingly, we are subject to increased risk related to financial statement disclosures.

Our control shareholder holds a significant percentage of our outstanding voting securities, which could reduce the ability of minority shareholders to effect certain corporate actions.

Our control shareholder is the beneficial owner of 71.27% of our preferred stock, which, along with his ownership of common stock, controls 71.36% of the voting securities prior to the Offering and 70.44% of our outstanding voting securities after the to the Offering, assuming all 200,000,000 shares of common stock in this Offering are sold. As a result of this ownership, he possesses and can continue to possess significant influence and can elect and can continue to elect a majority of our Board of Directors and authorize or prevent proposed significant corporate transactions. His ownership and control may also have the effect of delaying or preventing a future change in control, impeding a merger, consolidation, takeover or other business combination or discourage a potential acquirer from making a tender offer.

Upon the completion of this Offering, we expect to elect to become a public reporting company under the Exchange Act, and thereafter publicly report on an ongoing basis as an “emerging growth company” under the reporting rules set forth under the Exchange Act. If we elect not to do so, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 1 issuers. In either case, we will be subject to ongoing public reporting requirements that are less rigorous than Exchange Act rules for companies that are not “emerging growth companies”, and our stockholders could receive less information than they might expect to receive from more mature public companies.

Upon the completion of this Offering, we expect to elect to become a public reporting company under the Exchange Act. If we elect to do so, we will be required to publicly report on an ongoing basis as an “emerging growth company” (as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act) under the reporting rules set forth under the Exchange Act. For so long as we remain an “emerging growth company”, we may take advantage of certain exemptions from various reporting requirements that are applicable to other Exchange Act reporting companies that are not “emerging growth companies”, including but not limited to:

● not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

● taking advantage of extensions of time to comply with certain new or revised financial accounting standards;

● being permitted to comply with reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and

● being exempt from the requirement to hold a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

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We expect to take advantage of these reporting exemptions until we are no longer an emerging growth company. We would remain an “emerging growth company” for up to five years, although if the market value of our Common Stock that is held by non-affiliates exceeds $700 million as of any July 30 before that time, we would cease to be an “emerging growth company” as of the following December 31.

If we elect not to become a public reporting company under the Exchange Act, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 1 issuers. The ongoing reporting requirements under Regulation A are more relaxed than for “emerging growth companies” under the Exchange Act. The differences include, but are not limited to, being required to file only annual and semiannual reports, rather than annual and quarterly reports. Annual reports are due within 120 calendar days after the end of the issuer’s fiscal year, and semiannual reports are due within 90 calendar days after the end of the first six months of the issuer’s fiscal year.

In either case, we will be subject to ongoing public reporting requirements that are less rigorous than Exchange Act rules for companies that are not “emerging growth companies”, and our stockholders could receive less information than they might expect to receive from more mature public companies.

The preparation of our consolidated financial statements involves the use of estimates, judgments and assumptions, and our consolidated financial statements may be materially affected if such estimates, judgments or assumptions prove to be inaccurate.

Financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) typically require the use of estimates, judgments and assumptions that affect the reported amounts. Often, different estimates, judgments and assumptions could reasonably be used that would have a material effect on such financial statements, and changes in these estimates, judgments and assumptions may occur from period to period over time. Significant areas of accounting requiring the application of management’s judgment include, but are not limited to, determining the fair value of assets and the timing and amount of cash flows from assets. These estimates, judgments and assumptions are inherently uncertain and, if our estimates were to prove to be wrong, we would face the risk that charges to income or other financial statement changes or adjustments would be required. Any such charges or changes could harm our business, including our financial condition and results of operations and the price of our securities. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a discussion of the accounting estimates, judgments and assumptions that we believe are the most critical to an understanding of our consolidated financial statements and our business.

If securities industry analysts do not publish research reports on us, or publish unfavorable reports on us, then the market price and market trading volume of our Common Stock could be negatively affected.

Any trading market for our Common Stock will be influenced in part by any research reports that securities industry analysts publish about us. We do not currently have and may never obtain research coverage by securities industry analysts. If no securities industry analysts commence coverage of us, the market price and market trading volume of our Common Stock could be negatively affected. In the event we are covered by analysts, and one or more of such analysts downgrade our securities, or otherwise reports on us unfavorably, or discontinues coverage or us, the market price and market trading volume of our Common Stock could be negatively affected.

Future issuances of our Common Stock or securities convertible into our Common Stock, or the expiration of lock-up agreements that restrict the issuance of new Common Stock or the trading of outstanding stock, could cause the market price of our Common Stock to decline and would result in the dilution of your shareholding.

Future issuances of our Common Stock or securities convertible into our Common Stock, and/or conversion of the Notes convertible into Common Stock, or the expiration of lock-up agreements that restrict the sale of Common Stock by selling shareholders, or the trading of outstanding stock, could cause the market price of our Common Stock to decline. We cannot predict the effect, if any, of the exercise of conversion of the Notes into Common Stock or other future issuances of our Common Stock or securities convertible into our Common Stock, or the future expirations of lock-up agreements, on the price of our Common Stock. In all events, future issuances of our Common Stock would result in the dilution of your shareholding. In addition, the perception that locked-up parties will sell their securities when the lock-ups expire, could adversely affect the market price of our Common Stock.

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Our shares are subject to the penny stock rules, making it more difficult to trade our shares.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. If the price of our Common Stock is less than $5.00, our Common Stock will be deemed a penny stock. The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our Common Stock, and therefore stockholders may have difficulty selling their shares.

Our management has broad discretion as to the use of certain of the net proceeds from this Offering.

We intend to use up to $1,500,000 of the net proceeds from this Offering (if we sell all of the shares being offered) for working capital and other general corporate purposes. However, we cannot specify with certainty the particular uses of such proceeds. Our management will have broad discretion in the application of the net proceeds designated for use as working capital or for other general corporate purposes. Accordingly, you will have to rely upon the judgment of our management with respect to the use of these proceeds. Our management may spend a portion or all of the net proceeds from this Offering in ways that holders of our Common Stock may not desire or that may not yield a significant return or any return at all. The failure by our management to apply these funds effectively could harm our business. Pending their use, we may also invest the net proceeds from this Offering in a manner that does not produce income or that loses value. Please see “Use of Proceeds” below for more information.

Cautionary Statement Regarding Forward-Looking Statements

This Offering Circular contains various “forward-looking statements.” You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “would,” “could,” “should,” “seeks,” “approximately,” “intends,” “plans,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking statements by discussions of strategy, plans or intentions. These statements may be impacted by a number of risks and uncertainties.

The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance taking into account all information currently available to us. These beliefs, assumptions and expectations are subject to risks and uncertainties and can change as a result of many possible events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. You should carefully consider these risks before you make an investment decision with respect to our Securities. For a further discussion of these and other factors that could impact our future results, performance or transactions, see the section entitled “Risk Factors.”

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USE OF PROCEEDS

If we sell all of the shares being offered, our net proceeds (after our estimated offering expenses of $400,000) will be $9,600,000. We will use these net proceeds for:

If 25% of the Shares offered are sold:

Percentage of Offering Sold			Offering Proceeds		Approximate Offering Expenses		Total Net Offering Proceeds		Principal Uses of Net Proceeds
									Acquisition of energy assets  $1,500,000
									Salaries $500,000
									Business Development $125,000
									Legal  $125,000
									Marketing $62,500
									Consulting $62,500
									Operational costs $6,250
									Selling, general and administrative $6,250
									Working capital $293,750
	25.00	%	$	2,500,000	$	100,000	$	2,400,000

If 50% of the Shares offered are sold:

Percentage of Offering Sold			Offering Proceeds		Approximate Offering Expenses		Total Net Offering Proceeds		Principal Uses of Net Proceeds
									Acquisition of energy assets  $3,000,000
									Salaries $500,000
									Business Development $250,000
									Legal  $250,000
									Marketing $125,000
									Consulting $125,000
									Operational costs $50,000
									Selling, general and administrative $12,500
									Working capital $487,500
	50.00	%	$	5,000,000	$	200,000	$	4,800,000

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If 100% of the Shares offers are sold:

Percentage of Offering Sold			Offering Proceeds		Approximate Offering Expenses		Total Net Offering Proceeds		Principal Uses of Net Proceeds
									Acquisition of energy assets  $6,000,000
									Salaries $1,000,000
									Business Development $500,000
									Legal  $500,000
									Marketing $250,000
									Consulting $250,000
									Operational costs $100,000
									Selling, general and administrative $25,000
									Working capital $975,000
	100.00	%	$	10,000,000	$	400,000	$	9,600,000

The precise amounts that we will devote to each of the foregoing items, and the timing of expenditures, will vary depending on numerous factors.

As indicated in the table above, if we sell only 75%, or 50%, or 25% of the shares offered for sale in this Offering, we would expect to use the resulting net proceeds for the same purposes as we would use the net proceeds from a sale of 100% of the shares, and in approximately the same proportions, until such time as such use of proceeds would leave us without working capital reserve. At that point we would expect to modify our use of proceeds by limiting our expansion, leaving us with the working capital reserve indicated.

The expected use of net proceeds from this Offering represents our intentions based upon our current plans and business conditions, which could change in the future as our plans and business conditions evolve and change. The amounts and timing of our actual expenditures, specifically with respect to working capital, may vary significantly depending on numerous factors. The precise amounts that we will devote to each of the foregoing items, and the timing of expenditures, will vary depending on numerous factors. As a result, our management will retain broad discretion over the allocation of the net proceeds from this Offering.

In the event we do not sell all of the shares being offered, we may seek additional financing from other sources in order to support the intended use of proceeds indicated above. If we secure additional equity funding, investors in this Offering would be diluted. In all events, there can be no assurance that additional financing would be available to us when wanted or needed and, if available, on terms acceptable to us.

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DILUTION

If you purchase shares in this Offering, your ownership interest in our Common Stock will be diluted immediately, to the extent of the difference between the price to the public charged for each share in this Offering and the net tangible book value per share of our Common Stock after this Offering.

Our historical net tangible book value as of June 30, 2017 was $65,545 or $0.0003 per then-outstanding share of our Common Stock. Historical net tangible book value per share equals the amount of our total tangible assets less total liabilities, divided by the total number of shares of our Common Stock outstanding, all as of the date specified.

The following table illustrates the per share dilution to new investors discussed above, assuming the sale of, respectively, 100%, 50% and 25% of the shares offered for sale in this Offering (after deducting estimated offering expenses of $400,000, $200,000 and $100,000, respectively):

Percentage of shares offered that are sold	100%	50%	25%
Price to the public charged for each share in this Offering	0.05	0.05	0.05
Historical net tangible book value per share as of June 30, 2017 (1)	0.0003	0.0003	0.0003
Increase in net tangible book value per share attributable to new investors in this Offering (2)	0.0434	0.0399	0.0351
Net tangible book value per share, after this Offering	0.0437	0.0402	0.0354
Dilution per share to new investors	0.0063	0.0098	0.0146

(1)	Based on net tangible book value as of June 30, 2017 of $65,545 and 8,375,822 outstanding shares of Class A Common stock and 12,500,000 outstanding shares of Class B Common Stock.
(2)	After deducting estimated offering expenses of $400,000, $200,000, and $50,000, respectively.

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DISTRIBUTION

This Offering Circular is part of an Offering Statement that we filed with the SEC, using a continuous offering process. Periodically, as we have material developments, we will provide an Offering Circular supplement that may add, update or change information contained in this Offering Circular. Any statement that we make in this Offering Circular will be modified or superseded by any inconsistent statement made by us in a subsequent Offering Circular supplement. The Offering Statement we filed with the SEC includes exhibits that provide more detailed descriptions of the matters discussed in this Offering Circular. You should read this Offering Circular and the related exhibits filed with the SEC and any Offering Circular supplement, together with additional information contained in our annual reports, semi-annual reports and other reports and information statements that we will file periodically with the SEC. See the section entitled “Additional Information” below for more details.

Exchange Listing

Our Common Stock is traded on OTCMarkets in the Pink Open Market under the symbol “AEPT.”

Pricing of the Offering

Prior to the Offering, there has been a limited public market for the Offered Shares. The initial public offering price was determined by us. The principal factors considered in determining the initial public offering price include:

● the information set forth in this Offering Circular and otherwise available;

● our history and prospects and the history of and prospects for the industry in which we compete;

● our past and present financial performance;

● our prospects for future earnings and the present state of our development;

● the general condition of the securities markets at the time of this Offering;

● the recent market prices of, and demand for, publicly traded common stock of generally comparable companies; and

● other factors deemed relevant by us.

Investment Limitations

Generally, no sale may be made to you in this Offering if the aggregate purchase price you pay is more than 10% of the greater of your annual income or net worth (please see below on how to calculate your net worth). Different rules apply to accredited investors and non-natural persons. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov.

Because this is a Tier 1, Regulation A Offering, most investors must comply with the 10% limitation on investment in the Offering. The only investor in this Offering exempt from this limitation is an “accredited investor” as defined under Rule 501 of Regulation D under the Securities Act (an “Accredited Investor”). If you meet one of the following tests you should qualify as an Accredited Investor:

(i) You are a natural person who has had individual income in excess of $200,000 in each of the two most recent years, or joint income with your spouse in excess of $300,000 in each of these years, and have a reasonable expectation of reaching the same income level in the current year;

(ii) You are a natural person and your individual net worth, or joint net worth with your spouse, exceeds $1,000,000 at the time you purchase Offered Shares (please see below on how to calculate your net worth);

(iii) You are an executive officer or general partner of the issuer or a manager or executive officer of the general partner of the issuer;

(iv) You are an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, or the Code, a corporation, a Massachusetts or similar business trust or a partnership, not formed for the specific purpose of acquiring the Offered Shares, with total assets in excess of $5,000,000;

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(v) You are a bank or a savings and loan association or other institution as defined in the Securities Act, a broker or dealer registered pursuant to Section 15 of the Exchange Act, an insurance company as defined by the Securities Act, an investment company registered under the Investment Company Act of 1940 (the “Investment Company Act”), or a business development company as defined in that act, any Small Business Investment Company licensed by the Small Business Investment Act of 1958 or a private business development company as defined in the Investment Advisers Act of 1940;

(vi) You are an entity (including an Individual Retirement Account trust) in which each equity owner is an accredited investor;

(vii) You are a trust with total assets in excess of $5,000,000, your purchase of Offered Shares is directed by a person who either alone or with his purchaser representative(s) (as defined in Regulation D promulgated under the Securities Act) has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment, and you were not formed for the specific purpose of investing in the Offered Shares; or

(viii) You are a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has assets in excess of $5,000,000.

Offering Period and Expiration Date

This Offering will start on or after the Qualification Date and will terminate if the Minimum Offering is not reached or, if it is reached, on the Termination Date.

Procedures for Subscribing

When you decide to subscribe for Offered Shares in this Offering, you should:

Go to www.minivest.com, click on the “Invest Now” button and follow the procedures as described.

1. Electronically receive, review, execute and deliver to us a subscription agreement; and

2. Deliver funds directly by wire or electronic funds transfer via ACH to the specified account maintained by us.

Any potential investor will have ample time to review the subscription agreement, along with their counsel, prior to making any final investment decision. We shall only deliver such subscription agreement upon request after a potential investor has had ample opportunity to review this Offering Circular.

Right to Reject Subscriptions. After we receive your complete, executed subscription agreement and the funds required under the subscription agreement have been transferred to the escrow account, we have the right to review and accept or reject your subscription in whole or in part, for any reason or for no reason. We will return all monies from rejected subscriptions immediately to you, without interest or deduction.

Acceptance of Subscriptions. Upon our acceptance of a subscription agreement, we will countersign the subscription agreement and issue the shares subscribed at closing. Once you submit the subscription agreement and it is accepted, you may not revoke or change your subscription or request your subscription funds. All accepted subscription agreements are irrevocable.

Under Rule 251 of Regulation A, non-accredited, non-natural investors are subject to the investment limitation and may only invest funds which do not exceed 10% of the greater of the purchaser’s revenue or net assets (as of the purchaser’s most recent fiscal year end). A non-accredited, natural person may only invest funds which do not exceed 10% of the greater of the purchaser’s annual income or net worth (please see below on how to calculate your net worth).

NOTE: For the purposes of calculating your net worth, it is defined as the difference between total assets and total liabilities. This calculation must exclude the value of your primary residence and may exclude any indebtedness secured by your primary residence (up to an amount equal to the value of your primary residence). In the case of fiduciary accounts, net worth and/or income suitability requirements may be satisfied by the beneficiary of the account or by the fiduciary, if the fiduciary directly or indirectly provides funds for the purchase of the Offered Shares.

In order to purchase offered Shares and prior to the acceptance of any funds from an investor, an investor will be required to represent, to the Company’s satisfaction, that he is either an accredited investor or is in compliance with the 10% of net worth or annual income limitation on investment in this Offering.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of our operations together with our consolidated financial statements and the notes thereto appearing elsewhere in this Offering Circular. This discussion contains forward-looking statements reflecting our current expectations, whose actual outcomes involve risks and uncertainties. Actual results and the timing of events may differ materially from those stated in or implied by these forward-looking statements due to a number of factors, including those discussed in the sections entitled “Risk Factors”, “Cautionary Statement Regarding Forward-Looking Statements” and elsewhere in this Offering Circular. Please see the notes to our Financial Statements for information about our Critical Accounting Policies and Recently Issued Accounting Pronouncements.

Management’s Discussion and Analysis

The Company has not had material revenues from operations in each of the last two fiscal years, or in the first half of the current fiscal year.

American Energy Partners, Inc. is a group of companies that focus on providing solutions in the space where energy production and water meet technology.  Our subsidiaries, Hydration Corporation of PA, LLC, American Energy Solutions, and Gilbert Oil and Gas, will own energy operations as well as design, build and operate regional water treatment facilities that serve the industrial and energy sectors. Through the vertical integration of these companies, AEPT believes it can achieve higher operating profits than the industry average. This should lead to greater returns on invested capital.

Plan of Operation for the Next Twelve Months

The Company believes that the proceeds of this Offering will satisfy its cash requirements for the next twelve months. To complete the Company’s entire development plan, it may have to raise additional funds in the next twelve months.

The Company may make significant changes in the number of employees at the corporate level.

Investments. The Company intends to make substantial investment in energy producing assets that can make use of its water technologies.

Marketing and sales. The Company will cause its companies to make substantial marketing and sales expenses which will consist primarily of salaries, and benefits for our employees engaged in sales, sales support, marketing, business development, and customer service functions. Our marketing and sales expenses also include marketing and promotional expenditures.

Cost of revenue. The Company expects that the cost of revenue for its operations will consist primarily of expenses associated with the delivery and distribution of our products. These include expenses related to providing products and services and salaries and benefits for employees on our operations teams.

Research and development. The Company will continue to engage in research and development expenses. These will consist primarily of salaries, and benefits for employees who are responsible for building new products as well as improving existing products. We will expense all of our research and development costs as they are incurred.

General and administrative. The majority of our general and administrative expenses will consist of salaries, benefits, and share-based compensation for certain of our executives as well as our legal, finance, human resources, corporate communications and policy employees, and other administrative employees. In addition, general and administrative expenses include professional and legal services. The Company expects to incur substantial expenses in marketing the current Offering, in closing sales, and in promoting and managing its operations.

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Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Quantitative and Qualitative Disclosures about Market Risk

In the ordinary course of our business, we are not exposed to market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates, or that may otherwise arise from transactions in derivatives.

The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant estimates and assumptions include the fair value of the Company’s common stock, stock-based compensation, the recoverability and useful lives of long-lived assets, and the valuation allowance relating to the Company’s deferred tax assets.

Contingencies

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management, in consultation with its legal counsel as appropriate, assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company, in consultation with legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates a potentially material loss contingency is not probable, but is reasonably possible, or is probable, but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

Relaxed Ongoing Reporting Requirements

Upon the completion of this Offering, we expect to elect to become a public reporting company under the Exchange Act. If we elect to do so, we will be required to publicly report on an ongoing basis as an “emerging growth company” (as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act) under the reporting rules set forth under the Exchange Act. For so long as we remain an “emerging growth company”, we may take advantage of certain exemptions from various reporting requirements that are applicable to other Exchange Act reporting companies that are not “emerging growth companies”, including but not limited to:

● not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

● taking advantage of extensions of time to comply with certain new or revised financial accounting standards;

● being permitted to comply with reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and

● being exempt from the requirement to hold a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We expect to take advantage of these reporting exemptions until we are no longer an emerging growth company. We would remain an “emerging growth company” for up to five years, although if the market value of our Common Stock that is held by non-affiliates exceeds $700 million as of any July 30 before that time, we would cease to be an “emerging growth company” as of the following December 31.

If we elect not to become a public reporting company under the Exchange Act, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 1 issuers. The ongoing reporting requirements under Regulation A are more relaxed than for “emerging growth companies” under the Exchange Act. The differences include, but are not limited to, being required to file only annual and semiannual reports, rather than annual and quarterly reports. Annual reports are due within 120 calendar days after the end of the issuer’s fiscal year, and semiannual reports are due within 90 calendar days after the end of the first six months of the issuer’s fiscal year.

In either case, we will be subject to ongoing public reporting requirements that are less rigorous than Exchange Act rules for companies that are not “emerging growth companies”, and our stockholders could receive less information than they might expect to receive from more mature public companies.

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OUR BUSINESS

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American Energy Partners, Inc., Inc. is a group of companies that focus on providing solutions in the space where energy production and water meet technology.  Our subsidiaries, Hydration Corporation of PA, LLC, American Energy Solutions, and Gilbert Oil and Gas, will own energy operations as well as design, build and operate regional water treatment facilities that serve the industrial and energy sectors. 

We are a publicly-traded company, trading in the Pink Open Market under the symbol AEPT. We are comprised of subsidiaries that source, treat and distribute reclaimed water in an effort to preserve our nation’s naturally occurring resources. Together with Hydration Company of PA (sourcing, distributing) and American Energy Solutions (treating), Gilbert Oil and Gas Company provides value through net revenue interests, mineral interests and royalty rights.

Through the vertical integration of these companies, AEPT believes it can achieve higher operating profits than the industry average. This should lead to greater returns on invested capital.

Hydration Corporation of PA, LLC

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Hydration Corporation of PA, LLC (“Hydration Company”) is engaged in the businesses of water exploration, water augmentation, and the treatment of impacted waters. Through its subsidiaries and partners, it designs, builds, and operates regional water treatment facilities. Hydration Company is a leader in water-neutral energy solutions, as well as providing waste water technologies specifically designed to improve the impaired water disposal process.

We believe that Hydration Company technology delivers one of the highest energy yields from a broad range of water-bearing assets, with one of the lowest capital expenditures of any other known water processes.

Hydration Company offers a range of low cost attractive modular systems or fixed facilities via its water conveyance methodologies, which produce low cost water solutions in partnership with select small to large-size industrial energy users, government agencies, and non-profit watershed groups in target markets.

Hydration Company provides a solution to locate, procure, treat and distribute water. This patent-pending process provides cleaner water which results in an improved, safer environment. It can also mitigate drought conditions by accessing water previously unavailable. Applications may include, but are not limited to: oil and gas, pipelines, industrial use, utilities, mining, municipalities and landowners.

Hydration Company has designed a unique, patent pending system to treat and distribute water in an efficient and economical process that should encourage treated water to be used by gas drillers, pipeline companies, utility companies, industry and municipalities.

Over time, Hydration Company has gained support for its unique, patent-pending process by the DEP, SRBC, and the DCNR in Pennsylvania. In fact, we are currently negotiating contracts and letter of intent agreements with these organizations for mines that store our inventory.

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Hydration Company conducted its first pump test that was a field demonstration at Coal Creek, Blossburg, PA which was granted by the PA DEP & the SRBC. The pump test was performed through AES using GeoTube Technology which produced favorable test result. This enabled Hydration to (1) confirm the economic model, (2) prove the validity of the business model, and (3) share the results with potential partners, customers and government agencies.

Since that field demonstration Hydration Company has partnered with Eastern Pennsylvania Coalition for Abandoned Mine Reclamation (EPCAMR) and the SRBC to start the first three phases of due diligence at the Mocanaqua Tunnel. This property has an estimated 500 billion gallons of storage and appears to be an excellent candidate for Hydration Company’s methodologies. This opportunity would be worth an estimated $2.5 million of construction and operation and maintenance for AES. AES would provide the treatment technologies beginning in Phase IV.

Hydration Company’s competitive edge lies within its pure volume of reclaimed water and its access to low cost treatment with high flow rates and highly concentrated solids through AES’s partners’ technologies. Because of this volume, Hydration Company can effectively gain market share immediately as large corporations want access to one source that can supply massive amounts of reclaimed water to fulfill their input of production through Hydration’s patent pending (US 2014/0305879 A1) methodology and conveyance methods.

The success of the Company is dependent upon effectively entering into contracts with private and state-owned mines. These contracts give Hydration Company the sole right to distribute water from privately owned mines across the country.

The Company will operate out of multiple, predetermined, selected sites within the U.S. and will need minimal space to conduct its office activities. The sites are all different in terms of geography, storage and water quality. All sites will be enabled for augmentation or the ability to mitigate during pass-by conditions. Augmentation is an important factor of the equation. It allows Hydration Company to not only provide every day water but to provide additional waters to the system when low flow conditions are present. This is a valuable piece of the model because no matter how long or severe of a drought it gives customers the ability to consume at their intake up to their maximum docketed withdrawal thus granting them pass- by exemption.

How the model works: First, hydrological studies are performed statewide to determine the largest pools of non-potable water. Second, access and control of these mines are gained through contracts with the land owner. Third, final hydrology and engineering studies performed. Next, a filtration system is installed with all needed permits. Lastly, a dynamically-adjustable, turn-key system is put online that allows Hydration to execute its model of treatment and distribution through its proprietary conveyance system.

American Energy Solutions, LLC

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American Energy Solutions is an industrial waste stream treatment company that intends to engage in the remediation of Superfund sites, coal ash, acid mine drainage & MIW, drill Cuttings (HDD & VDD), flowback & produced waters, and other industrial processes.

We provide treatment technologies that contribute to Hydration Company’s business model of low-cost treatment and distribution. These treatment technologies also allow AES to leverage existing contacts in the industrial space and convert these contacts into contract value. AES’s long-term goal is to bring waste stream treatment technologies in- house.

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Gilbert Oil and Gas

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We intend to develop Gilbert Oil as a U.S.-based exploration and production company focused on generating long-term shareholder value through drilling, operating, and partnership opportunities in the upstream oil and gas space.

Gilbert’s sole service is to provide cash flow through investment in oil and gas royalties, producing wells and the development of mineral rights.

Gilbert came into existence to capitalize on the depressed asset pricing in the oil and gas space. Gilbert’s business model is to first capture royalty opportunities then gain working interests on producing wells and lastly to acquire land inventory through mineral rights.

Gilbert will concentrate its initial capital inside the Marcellus & Utica formations where we can monetize existing water assets and treatment technologies.

Following this model we are of the belief that meaningful asset and cash flow value will be derived over the course of time.

Target Markets

Oil & Gas

A technique known as hydraulic fracturing, commonly referred to as fracking, is a necessary part of natural gas production. Fracking is used to create small fissures in the shale, allowing natural gas to flow. Fracking involves the pumping of a mixture of more than 99% water and sand with a small amount of special-purpose additives into the ground under high pressure to form the hairline cracks. The newly created fractures are “propped” open by the sand, which allows the natural gas to flow into the wellbore and be collected at the surface. For a typical natural gas well, Chesapeake Energy estimates approximately 3.5 million gallons of water are used during fracking operations. The 3.5 million gallons of water needed to drill and fracture a typical deep shale gas well is equivalent to the amount of water consumed by New York City in approximately five minutes, or a 1,000 megawatt coal-fired power plant in eight and three quarters of an hour, or a golf course in eight days, or six acres of corn in a season.

In Pennsylvania, the Marcellus Shale Formation has attracted the natural gas industry and as a result there has been a creation (permits) of three thousand (3,000) wells last year alone. If one makes the assumption that each well was only fractured once, there was an average of ten and a half (10.5) billion gallons of water consumed. It is estimated that over fifty (50) trillion cubic feet of natural gas still needs to be drilled for. With such staggering numbers, water will be in short supply and high demand. In fact, water usage in this region in the short-run alone will approach, if not exceed one hundred (100) billion gallons of water as the natural gas companies race to profit from the natural gas reserves.

Municipalities

Water shortages are becoming commonplace due to many factors such as industry, population growth, water quality, and extreme weather patterns. Municipalities could find themselves purchasing water from alternate sources to supplement their traditional methods of supplying water to their customer base. This customer base now includes the oil and gas companies who now find themselves searching for clean, inexpensive sources of water to use in their fracking process.

As one can observe from the list of users above, treated, reclaimed water can be utilized by a range of customers. In spite of this, Hydration Company will recognize, prioritize, and effectively distribute the reclaimed water in a fashion that will maximize preservation efforts. This management of scarce resources will simultaneously drive the profitability of Hydration Company.

Reclaimed Water Sales

The segmentation of reclaimed water sales are broken down into two segments: industrial and household users. Current forecasts estimate over 95% of sales will be compromised of industrial users and households will make up less than 5% of sales. Within the industrial composition we have included government agencies.

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Target Market Segmentation Strategy

Oil & Gas Market Opportunity

Within the Commonwealth of Pennsylvania significant opportunities exist within the industrial segment. The natural gas industry alone will present enormous opportunities for Hydration Company, AES & Gilbert. To quantify this in terms of gallons of water, if every opportunity was seized a minimum of 3.5 billion gallons would be sold. This makes the assumption that each well is fractured only once and uses an average of 3.5 million gallons of water; many sources are making claims that up to nine million gallons of water are used and an average of four to six million gallons. Such opportunities also exist in bordering states which present equal, if not greater gallon usage. Even though hundreds of wells are currently in operation the Marcellus Shale exploration is still in the first inning of drilling for the estimated 50 trillion cubic feet of reserves.

Taking into consideration the remediation of impoundments, treatment of flowback, produced and drill cuttings tremendous opportunities exist in oil and gas alone for AES.

Pipeline Companies

Pipeline companies have plans to install pipelines in our initial targeted region of Pennsylvania. Pipelines require continuous flows of water for distribution to the end users and treatment of their drill cuttings. Hydration Company can provide an alternative source of water to the pipeline companies insuring this continuous flow of water. This can be achieved due to a pass-by exemption provision offered by the Commonwealth when utilizing treated acid mine drainage water. Hydration can also provide everyday treated water that will lower transmission costs and lower their capital expenditures on the amount of pipeline ran. Hydration believes the economics of the model are attractive to pipeline operators. They are selling water to end users at $2.40 per barrel, which is well above the estimated cost ten cents per barrel to Hydration to treat and distribute into their pipeline.

Competition

Hydration Company of PA, LLC

There are two classifications of competitors that currently exist: (1) Municipal/Watershed sources and (2) Private Individuals.

Municipal

There are four rivers with significant flow volume within Pennsylvania. They are the Susquehanna, Delaware, Chenango, and Chemug Rivers. There are a couple barriers to draw meaningful gallons from these rivers. First, one must have the correct permits to withdraw, divert, and/or consume. Second, in some instances landowner approval must be sought along with approval to purchase water from Public Water Suppliers.

Hydration Company has a distinctive advantage because Hydration Company does not have to seek multiple permits and approvals from landowners because of the patent-pending conveyance process.

Furthermore, Hydration utilizes waters that are not part of the water table, i.e. mine pools which are isolated “man created” structures. Also, Hydration Company has a lower cost basis than drawing water from these public sources. Moreover, Hydration Company is not regulated by nature as these other sources currently cap water withdrawal. This cap or pass-by is exacerbated by drought conditions and local landowners who invoke legal actions to prevent their wells from going dry.

Individuals

Currently private individuals who own water filled mines/quarries have the right to sell the water for profit. To date, no single individual has emerged that has the ability to satisfy the demand that has been created by the population growth, climate change, regulations and industries. Hydration Company can not only meet this demand but will be able to command greater margins per gallon sold through delivery contracts. Industrial buyers will prefer to deal on larger volumes (millions, billions, trillions) and more cost efficient delivery methods (pipelines and distances), such as Hydration Company’s patent pending methodology and conveyance system.

American Energy Solutions, LLC

AES faces competition from multiple companies that engage in treatment solutions. These solutions include filter presses, clarifiers and centrifuges which all tend to be expensive with large operation and maintenance budgets, energy intensive and rarely perform as advertised.

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AES provides near real time, low-cost, high flow rate, low footprint treatment. The combination of the listed factors provides the competitive advantage needed to gain market penetration. Furthermore, it affords Hydration Company and Gilbert the same competitive advantage while increasing their financial performance.

Gilbert Oil & Gas, LLC

Gilbert will encounter competition from other oil and gas companies, private equity groups and others with substantial resources that similarly plan on acquiring depressed oil and gas assets. Even though there is competition we do not think it will inhibit our growth plan in a meaningful way.

Growth Issues

Service Delivery Controls

When awarded contracts that require additional resources, AEPT will utilize its list of available consultants with expertise in the required areas. The collaborative nature of our professionals, coupled with our low overhead approach of hiring consultants on an as- needed basis creates challenges in the delivery of quality services and deliverables. AEPT realizes that not everyone will share our vision, values, and methods.

In addition, AEPT understands that as more sites come online it becomes increasingly difficult to monitor projects and communicate information to our consultants.

Because AEPT utilizes exhaustive interviewing, stringent candidate selection and referrals from trusted advisors there is a reasonable confidence that the majority of our concerns will be eliminated through these processes. AEPT will enter into agreements with consultants and contractors who demonstrate a bold commitment to representing the core values of AEPT in an effective manner.

Scalability

The ability to reproduce our proven system on a massive scale is a concern of AEPT. Every site is unique and presents different challenges. Such factors can negatively impact the growth and consistency of our methods and will ultimately challenge our ability to replicate our initial success. This will directly impact how fast AEPT can scale its operations.

Insufficient Capital

Currently AEPT is confronted with the need to attract and retain a consistent investment source in order to grow our operations rapidly. If AEPT is not funded properly it will prevent us from capturing the majority of the market.

To maintain our leadership role and first mover advantage in this space AEPT is seeking funding from the capital markets which may include debt and equity offerings.

Sales Lead Time

Currently lead time for each project is estimated at ten (10) months. This reflects permitting, equipment ordering and delivery of and installation.

Permitting is the majority of the lead time. It takes months to gain approval from the SRBC, DEP and local permits to install and operate our systems. These permits are not always needed in every project and other permits may be needed, depending on the project.

Moving forward utilizing a permit in waiting strategy and submitting multiple permits may diminish this drawn out process.

Marketing Strategy

Our method of distribution is also different than any other water source or provider. In fact, our method has never been done before in the SRBC region. The SRBC has signed off on it as Hydration Company was able to model the business inside of all current SRBC regulations.

This method, the Hydration Method, allows Hydration Company to use the discharge streams as natural pipelines which flow into major water sources such as the Susquehanna River. The use of a natural pipeline creates a distinct economic advantage.

Being able to use every day water and a pass-by exemption is a distinct economic benefit to any end user.

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The capacity to drive profits will largely depend on managements’ ability to match our reclaimed sources of water to end users, develop business for AES’s treatment technologies and close oil and gas properties at an attractive valuation under Gilbert. This will be done through individualized meetings with industrial customers already operating within the Northeast and other select markets where the economics make sense.

Marketing AEPT’s services will be done through several different strategies. First, our relationship with industrial companies will foster word of mouth advertising. Next, our consultants and sales personnel have meaningful relationships across a broad range of industries. These relationships can lead to contracts. Lastly, partnering with institutions such as the Penn State University Marcellus Shale Center is a unique opportunity that we have come upon. At PSU Marcellus Shale they publish papers related to best practices in the field. The published reports have the ability to market AEPT’s business model to industry leaders.

Competitive Edge

Hydration Company’s competitive edge lies within its pure volume of reclaimed water and its access to low cost treatment with high flow rates and highly concentrated solids through our technologies. Because of this volume, Hydration Company can effectively gain market share immediately as large corporations want access to one source that can supply massive amounts of reclaimed water to fulfill their input of production through Hydration’s patent pending (US 2014/0305879 A1) methodology and conveyance methods. Hydration Company can also provide the reclaimed water without interruption which is not the case with all of its competitors.

We believe that due to our competitive edges, Hydration Company will be able to price its competitors out of the market. Current estimates place Hydration Company’s total expenditure at ten cents per barrel. Hydration Company intends to charge a minimum of sixty cents per barrel for its every day water services. This compares with market costs of sixty cents for fresh water, ninety cents for abandoned mine drainage, and two dollars and forty cents per barrel for pipeline water in the Northeast.

American Energy Solutions, LLC

AES has positioned itself to take advantage of the vast need for water treatment and waste stream treatment not only from Hydration Company, but from a wide range of industrial clients that include Gilbert.

AES’s services range from small mobile applications to large scale deployment. Whether it is a coal mine, steel mill lagoon or a coal ash producing power plant, AES has the ability to handle them all.

AES has begun business development in a handful of industrial segments where it believes the treatment technologies could be deployed in an effective manner. To date, approximately 30 unique opportunities have been identified. These projects in the pipeline range from opportunity to written proposal to negotiation phases. We have confidence that contracts will be derived from this pipeline worth millions of dollars within the next year.

Hydration Company of PA, LLC

Hydration Company is engaged in a single service: to locate, procure, treat and distribute water through its patent pending methodology and conveyance system, and it can be distributed to multiple end-users. This includes, but is not limited to, oil and gas companies, local and regional pipelines, municipalities and land owners.

Mocanaqua Abandoned Mine Drainage (AMD) Tunnel.

We have entered into a contract with the Eastern Pennsylvania Coalition for Abandoned Mine Reclamation (“EPCAMR”) to engage the Susquehanna River Basin Commission (“SRBC”) in a multi-phase study of the Mocanaqua Abandoned Mine Drainage (AMD) Tunnel.

This project, if successful, may lead to the supply of millions of gallons of treated mine influenced water during low flow conditions into the local watershed that feeds the Susquehanna River (Pennsylvania).

The Mocanaqua AMD Tunnel mine is believed to be a significant mine pool of isolated mine water. The mine pool size is thought to exceed 500 billion gallons of water. This static mine pool should be adequate to support the SRBC’s criteria for an augmentation source.

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EPCAMR is currently digitizing, geo-referencing, and delineating underground mine pool boundaries for the Mocanaqua AMD Tunnel in Phase I of the project. There are around 15 grid sections with an average of six coal veins to each grid to review and add elevation data for an estimated 90 mine maps from the Office of Surface Mining Folio Map Series. The coal veins in the southern tip of the northern anthracite coalfields in the lower Wyoming Valley are the Baltimore Vein, Top and Bottom Ross, Top and Bottom Red Ash, and the Red Ash. Data collected will be used to create a 3D Model of the surface and underground mine pool complexes and multi-colliery hydrologic units within the project area to more accurately calculate the potential mine pool storage volume potential within the project area by EPCAMR. Specific areas will then be drilled for more detailed in-situ mine pool monitoring of chemistry and elevation changes in the mine pool and at strategic surface monitoring locations within the Black Creek watershed and in several surface water-filled stripping pits. Data collected, under an approved State Forest Research Agreement, will be used by EPCAMR, SRBC, and AEPT and the Pennsylvania Department of Conservation & Natural Resources, who own the Pinchot State Forest.

Susquehanna River Basin Commission

The purpose of Susquehanna River Basin Commission (SRBC) is to enhance public welfare through comprehensive planning, water supply allocation, and management of the water resources of the Susquehanna River Basin.

About EPCAMR

The purpose of EPCAMR is to encourage the reclamation and redevelopment of land affected by past mining practices. This includes reducing hazards to health and safety, eliminating soil erosion, improving water quality and returning land affected by past mining practices to productive use, thereby improving the economy of the region. Formed in 1995 by concerned conservation districts, EPCAMR represents a coalition of watershed organizations and reclamation partners. Members range from individuals, to the active anthracite mining industry and co-generation power plants, to non-profit organizations, 16 county conservation districts and other organizations in the anthracite and bituminous coal region of eastern Pennsylvania that are involved with abandoned mine reclamation issues. http://epcamr.org/home/

Legal Proceedings

We may from time to time be involved in various claims and legal proceedings of a nature we believe are normal and incidental to temporary employee staffing business. These matters may include product liability, intellectual property, employment, personal injury cause by our employees, and other general claims. We will accrue for contingent liabilities when it is probable that a liability has been incurred and the amount can be reasonably estimated. We are not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

Employees

We currently have one employee. We have one non-employee director.

Personnel will be added on an as-needed basis. These personnel can include executive management, salespersons, engineers, chemists, hydrologists, quality control technicians, transportation experts, managers and in most instances outsourced processes.

Specific and current needs include a sales team, an office administrator and a field engineer to verify sites and coordinate agreements.

Description of Property

We rent an office in Allentown, Pennsylvania. We consider that this space is sufficient for our current needs.

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MANAGEMENT

The following table sets forth information regarding our executive officers, directors and significant employees, including their ages as of June 30, 2017:

Name and Principal Position	Age	Term of Office	Approximate hours per week
Brad Domitrovitsch-Director/CEO/Chairman	36	Since December 15, 2016	40
Josh Hickman, PG, MSc, MBA – Director	38	Since June 30, 2017	0

Brad J. Domitrovitsch, MBA – Chairman

Brad J. Domitrovitsch is a co-founder of Twisted Metal Recycling, LLC which buys and sells ferrous and nonferrous metals that take advantage of arbitrage situations. He is President of West End Consulting Group, LLC a management and financial consulting firm. He is Chairman and CEO of American Energy Partners, Inc. From 2004 to 2014 he was the owner of S.A. Knappenberger which bought and sold ferrous and nonferrous metals and took advantage of arbitrage situations.

Mr. Domitrovitsch has an MBA degree from Moravian College and a B.S. degree from Kutztown University of Pennsylvania. He is a member of the Board of Directors of Moravian College. He has a Certificate in Entrepreneurship from Lehigh University, Investment Banking Institute.

Josh Hickman, PG, MSc, MBA – Director

Mr. Hickman has 15 years of experience in the unconventional shale oil and gas industry.

Previous to his role with Gilbert Energy, Mr. Hickman was the CEO of Dahlmont Energy Resources, a private oil and gas company.  In 2014 he founded, and still holds an interest in, Hickman Geological Consulting, LLC. The focus of that company’s work is on the decision space between financial matters and technical data. HGC provides this expertise to financial institutions, startup oil and gas companies, and landowners. Notable achievements with this company include a relationship as Shenhua America’s adviser on U.S. oil and gas investments in 2015, and becoming the dominant market shareholder for oil and gas property valuations in the Greater Pittsburgh area.

Advisors

Leo K. Howell III

Mr. Howell is a Managing Member of Driscole Howell LLC, an attorney licensed in Pennsylvania and New Jersey. Mr. Howell is a founding member of the Lehigh Valley based law firm, Driscole Howell LLC. As an attorney representing clients throughout the Commonwealth of Pennsylvania and New Jersey, Mr. Howell focuses his practice on complex matrimonial litigation and small business representation. As counsel and an advocate for small business, Mr. Howell assists start-up ventures from formation, through restructuring, dispute litigation and resolution. He provides legal services regarding buy-sell arrangements, succession planning and dissolution. In addition to structuring, Mr. Howell assists in the legal aspects of normal daily business operations such as contracting, governance, human resources, drafting, review, and negotiation of contracts and leases. Further, Mr. Howell regularly takes a hands-on approach with his small business clients and develops and refines their policies and handbooks.

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Prior to working at Driscole Howell LLC, Mr. Howell was of-counsel to Hopkins & Schafkopf, LLC, a Philadelphia law firm focusing on retail collection and debt negotiation.

He holds a Juris Doctorate from the Duquesne University School of Law in Pittsburgh, Pennsylvania and a Bachelor of Arts Degree in History from Moravian College in Bethlehem, Pennsylvania.

Cathy Fogle

Ms. Fogle brings a wealth of experience across many disciplines which include; Health care, insurance, state and federal regulations, real estate investment, construction and renovation. Ms. Fogle also has a significant knowledge base within financing, cost analysis, and budgets.

Ms. Fogle has been an active investor in start-up ventures for over a decade where she has engaged in an activist role. In addition, she has played an instrumental part at numerous health care start-ups that span multiple decades that ended in successful buyouts.

Ms. Fogle enjoys spending time with her grandchildren and gardening at her Lehigh Valley, PA residence.

Jim Seif

Mr. Seif has tremendous expertise in the development and implementation of energy and environmental initiatives at both the state and national levels. We believe his contributions will be a valuable asset to AEPT.

Mr. Seif started his career in the U.S. Attorney’s Office in Pittsburgh, Pennsylvania, prosecuting some of the earliest environmental cases of the modern era.  After that, he served as chief of the Legal Branch at the US Environmental Protection Agency in Philadelphia, and then rejoined the US Justice Department in the Criminal Division. Mr. Seif later served as administrative assistant to Governor Dick Thornburgh and then regional administrator of the EPA’s six-state office in Philadelphia. Following that work, he joined the environmental practice at the law firm of Dechert Price and Rhoads. In 1995, then-Governor Tom Ridge appointed Mr. Seif as secretary of the Department of Environmental Protection (DEP). In 2000, Seif received a Lifetime Award for Public Service from the National Academy of Public Administration for his 30-year career in state and federal government.

Mr. Seif later became Vice President for Corporate Relations at PPL, Inc., a Fortune 500 energy and utility company in Allentown, PA. He is currently a Principal at Ridge Global, LLC and is an advisory committee member of the Dick Thornburgh Legacy Project at the University of Pittsburgh. He holds a political science degree from Yale University and a law degree from the University of Pittsburgh.

Robert Barkanic

Mr. Robert Barkanic is a senior energy executive with over 35 years of experience in nuclear energy, environmental policy and management, government relations, regulatory affairs, project management and political action, together with a Graduate Degree in Engineering Science. Mr. Barkanic is a high performing executive with a proven track record of accomplishments developing strategic long term partnerships and policy positions based on sound engineering and economic principles and communicating effectively with all levels of decision makers.

Mr. Barkanic has an M.E. degree with a Major in Engineering Science and a B.S. degree with a Major in Structural Design Engineering Technology from Pennsylvania State University. He is registered as a Professional Engineer in Pennsylvania, Hawk Mountain Sanctuary, a Board Member of the Pennsylvania Association of Environmental Professional, a Member of the Electric Power Generators Association and a past Member and Chair of the EEI Environmental Executive Advisory Committee.

Family Relationships

There are no family relationships between any of our officers and directors except that Mr. Domitrovitsch is the son of Ms. Fogle.

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Involvement in Certain Legal Proceedings.

None of the following events have occurred during the past five years and which are material to an evaluation of the ability or integrity of any director or executive officer: (1) A petition under the federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing; or (2) Such person was convicted in a criminal proceeding (excluding traffic violations and other minor offenses).

Board Composition

Our Board of Directors currently consists of two members. Each director of the Company serves until the next annual meeting of stockholders and until his successor is elected and duly qualified, or until his earlier death, resignation or removal. Our board is authorized to appoint persons to the offices of Chairman of the Board of Directors, President, Chief Executive Officer, one or more vice presidents, a Treasurer or Chief Financial Officer and a Secretary and such other offices as may be determined by the board.

We have no formal policy regarding board diversity. In selecting board candidates, we seek individuals who will further the interests of our stockholders through an established record of professional accomplishment, the ability to contribute positively to our collaborative culture, knowledge of our business and understanding of our prospective markets.

Board Leadership Structure and Risk Oversight

The Board of Directors oversees our business and considers the risks associated with our business strategy and decisions. The board currently implements its risk oversight function as a whole. Each of the board committees when established will also provides risk oversight in respect of its areas of concentration and reports material risks to the board for further consideration.

Code of Business Conduct and Ethics

Prior to one year from the date of this Offering’s qualification, we will be adopting a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer or controller, or persons performing similar functions. We will post on our website a current copy of the code and all disclosures that are required by law or market rules in regard to any amendments to, or waivers from, any provision of the code.

EXECUTIVE COMPENSATION

The following table represents information regarding the total compensation our officers and directors of the Company as of December 31, 2016:

Name and Principal Position	Cash Compensation ($)		Other Compensation ($)		Total Compensation ($)
Brad Domitrovitsch, Director, CEO, Chairman		-0-		-0-		-0-
Josh Hickman, PG, MSc, MBA – Director		-0-		-0-		-0-

29

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

To the best of our knowledge, from inception to June 30, 2017, other than as set forth above, there were no material transactions, or series of similar transactions, or any currently proposed transactions, or series of similar transactions, to which we were or are to be a party, in which the amount involved exceeds $120,000, and in which any director or executive officer, or any security holder who is known by us to own of record or beneficially more than 5% of any class of our Common Stock, or any member of the immediate family of any of the foregoing persons, has an interest (other than compensation to our officers and directors in the ordinary course of business).

Statement of Policy

We have adopted a related-party transactions policy under which our executive officers, directors, nominees for election as a director, beneficial owners of more than 5% of any class of our Common Stock, and any members of the immediate family of any of the foregoing persons are not permitted to enter into a related-party transaction with us without the consent of our audit committee. If the related party is, or is associated with, a member of our audit committee, the transaction must be reviewed and approved by another independent body of our Board of Directors, such as our governance committee. Any request for us to enter into a transaction with a related party in which the amount involved exceeds $120,000 and such party would have a direct or indirect interest must first be presented to our audit committee for review, consideration and approval. If advance approval of a related-party transaction was not feasible or was not obtained, the related-party transaction must be submitted to the audit committee as soon as reasonably practicable, at which time the audit committee shall consider whether to ratify and continue, amend and ratify, or terminate or rescind such related-party transaction. All of the transactions described above were reviewed and considered by, and were entered into with the approval of, or ratification by, our Board of Directors.

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information known to us regarding beneficial ownership of our capital stock as of June 30, 2017 for (i) all executive officers and directors as a group and (ii) each person, or group of affiliated persons, known by us to be the beneficial owner of more than ten percent (10%) of our capital stock. The percentage of beneficial ownership in the table below is based on 8,375,822 shares of Class A Common Stock and 12,500,000 shares of Class B Common Stock deemed to be outstanding after our recent reverse split.

Class A Preferred Stock

Name of Beneficial Owner	Number of Shares Beneficially Owned		Percent of Class
West End Consulting Group, LLC (1) (2)		534,505,255		71.27
Michael McClaren (3)		121,000,000		16.13
Converde Industries, Inc. (4)		50,000,0000		6.67
Total		655,505,255		94.07

30

Class B Common Stock $0.001 par value

Name of Beneficial Owner	Number of Shares Beneficially Owned		Percent of Class
West End Consulting Group, LLC (1)(2)		9,700,000		77.60
Converde Industries, Inc.(4)		2,500,000		20.00
Mike McClaren (3)		300,000		2.40
Total		12,500,000		100.00

Class A Common Stock $0.001 par value

Name of Beneficial Owner	Number of Shares Beneficially Owned		Percent of Class Before Offering		Percent of Class After Offering
West End Consulting Group, LLC (1)(2)		4,200,000		50.14		2.02
Fast Balance CEDE (5)		2,275,446		27.17		1.09
Converde Industries, Inc.  (4)		650,000		7.76		0.31
Rocky Trust  (6)		500,000		5.97		0.24
Empire Investment Trust  (7)		500,000		5.97		0.24
All Executive Officers, Directors and 5% Shareholders as a Group		8125446		97.01		3.90

(1) Brad Domitrovitsch owns 100% of West End Consulting Group, LLC.

(2) The address of West End Consulting Group, LLC is PO Box 443 Allentown, PA 18105.

(3) The address of Mike McClaren is 155B Turnbull Crt., Cambridge, Ontario N1T 1J2, Canada.

(4) The address of Converde Industries, Inc. is 120 Turnbull Crt, Cambridge, Ontario N1T 1H9, Canada

(5) The address of Fast Balance CEDE is Central Delivery - Out Transfer Dept, 55 Water Street , 2SL, New York, NY 10041.

(6) The address of Rocky Trust is PO Box 443, Allentown, PA 18105.

(7) The address of Empire Investment Trust is PO Box 443. Allentown, PA 18105.

31

DESCRIPTION OF SECURITIES

Securities Being Offered

The following is a summary of the rights of our capital stock as provided in our articles of incorporation and bylaws. For more detailed information, please see our articles of incorporation and bylaws, which have been filed as exhibits to the Offering Statement of which this Offering Circular is a part.

General

Our authorized capital stock consists of 7,000,000,000 shares of common stock, par value $0.001 per share. Of these shares of authorized common stock, 5,000,000 shares are Class A Common Stock, and 2,000,000 shares are Class B Common Stock.

Each holder of Class A Common Stock shall be entitled to one vote for each share of such stock standing in his name on the books of the Corporation. The holders of the Class B Common Stock shall be entitled to Twenty (20) votes for each share of Class B Common Stock held.

Our authorized capital stock also includes 1,000,000,000 shares of Series A Preferred Stock, par value $0.001, of which 750,000,000 shares issued or outstanding.

Capitalization

Security	Par Value		Authorized		Outstanding		Voting Rights		Conversion Into Shares of Common Stock
Class A Preferred		0.001		1,000,000,000		750,000,000		20		20
Class A Common		0.001		5,000,000,000		8,375,822		1		1
Class B Common		0.001		2,000,000,000		12,500,000		20		None

Preferred Stock

The Company has authorized 750,000,000 shares of Class A Convertible Preferred Stock,” par value $0.001 per share. The holders of shares of Class A Preferred Stock have no dividend rights except as may be declared by the Board of Directors of the Corporation in its sole and absolute discretion, out of funds legally available for that purpose. In the event of any liquidation, dissolution or winding-up of the affairs of the Corporation, the Class A Preferred Stock shall be entitled to receive, before any payment shall be made to the holders of Common Stock or any other class or series of stock ranking on Liquidation junior to such Class A Preferred Stock, an amount per share equal to $1.00. The Class A Preferred Stockholders shall be entitled to Twenty (20) votes for each share of Class A Preferred Stock held on any matters requiring a shareholder vote of the Corporation. Any Class A Preferred Stockholder shall have the right, at any time from the date of issuance, to convert any or all of its Class A Preferred Stock into 20 shares of fully paid and nonassessable shares of Common Stock for each share of Class A Preferred Stock so converted.

32

Common Stock

Voting Rights. The holders of the Class A Common Stock are entitled to one vote for each share held of record on all matters submitted to a vote of the shareholders. The holders of the Class A Common Stock are entitled to 20 votes for each share hold of record on all matter submitted to a vote of the shareholders. Colorado law provides for cumulative voting for the election of directors. As a result, any shareholder may cumulate his or her votes by casting them all for any one director nominee or by distributing them among two or more nominees. This may make it easier for minority shareholders to elect a director.

Dividends. Subject to preferences that may be granted to any then outstanding preferred stock, holders of common stock are entitled to receive ratably such dividends as may be declared by the Board of Directors out of funds legally available therefor as well as any distributions to the shareholders. The payment of dividends on the common stock will be a business decision to be made by our Board of Directors from time to time based upon results of our operations and our financial condition and any other factors that our Board of Directors considers relevant. Payment of dividends on the common stock may be restricted by loan agreements, indentures and other transactions entered into by us from time to time.

Liquidation Rights. In the event of our liquidation, dissolution or winding up, holders of common stock are entitled to share ratably in all of our assets remaining after payment of liabilities and the liquidation preference of any then outstanding preferred stock.

Absence of Other Rights or Assessments. Holders of common stock have no preferential, preemptive, conversion or exchange rights. There are no redemption or sinking fund provisions applicable to the common stock. When issued in accordance with our articles of incorporation and law, shares of our common stock are fully paid and not liable to further calls or assessment by us.

Certain Provisions

Certain provisions of our Articles of Incorporation and By-Laws may make it more difficult and time-consuming to acquire the Company, thereby reducing our vulnerability to an unsolicited proposal for our takeover. These provisions are outlined below.

Our Articles also contain restrictions regarding certain mergers, consolidations, asset sales and other “Business Combinations.” “Business Combinations” are defined in the Articles of Incorporation. The above provisions could have the effect of depriving shareholders of any opportunity to sell their shares at a premium over prevailing market prices because takeovers frequently involve purchases of stock directly from shareholders at such a premium price. Further, to the extent these provisions make it less likely that a takeover attempt opposed by our incumbent Board of Directors and management will succeed, the effect could be to assist the Board of Directors and management in retaining their existing positions. In addition, our Articles also provide that the provisions outlined herein cannot be amended, altered, repealed, or replaced without a “super-majority” vote or the approval of a Majority of Continuing Directors.

33

Among other provisions that might make it more difficult to acquire us, we have adopted the following:

Staggered Board. Our Board of Directors has been divided into three classes of directors. The term of one class will expire each year. Directors for each class will be chosen for a three-year term upon the expiration of such class’s term, and the directors in the other two classes will continue in office. The staggered terms for directors may affect the stockholders’ ability to change control of the Company even if a change in control were in the stockholders’ interest.

 Preferred Stock. Our charter authorizes the Board of Directors to issue up to 500,000,000 shares of Preferred Stock and to establish the preferences and rights (including the right to vote and the right to convert into shares of Common Stock) of any shares issued. The power to issue Preferred Stock could have the effect of delaying or preventing a change in control of the Company even if a change in control were in the stockholders’ interest.

Our Articles also authorize the Board of Directors to oppose a tender offer on the basis of factors other than economic benefit to our shareholders. Among the factors that may be considered are the impact our acquisition would have on the community, the effect of the acquisition upon our employees and the reputation and business practices of the tender offeror.

Our Articles of Incorporation also contain restrictions regarding certain merger, consolidations, asset sales and other “Business Combinations” involving the Company or its subsidiaries. Business Combinations are defined in the Articles as (a) any merger or consolidation by us with an Interested Stockholder, (defined as a holder of at least 10% of our voting stock with certain exceptions), or (b) any sale, lease or similar disposition to an Interested Stockholder of any of our assets constituting at least 5% of our total assets, or (c) the issuance or transfer by the Company of any of our stock to an Interested Stockholder in return for cash or other property, being at least 5% of our total assets, or (d) adoption of any plan to dissolve or liquidate the Company proposed by an Interested Stockholder, or (e) any reclassification of stock or recapitalization of the Company or merger whereby the percentage of outstanding shares of any Interested Stockholder is increased.

Business Combinations with an interested Stockholder must be approved by the holders of 80% of the voting power of our outstanding shares, unless (a) the Business Combination is approved in advance by those persons then on the Board of Directors who were directors immediately prior to the time the Interested Stockholder (or certain of its predecessors) first became an Interested Stockholder and who would have constituted a majority of the Board at that time (a “Majority of the Continuing Directors”), or (b) certain minimum “fair price” requirements are met. In evaluating a Business Combination, the Board of Directors may consider the financial aspects of the offer, the long-term interests of our shareholders, past and present market values of the shares, our prospects, the prospect of obtaining a better offer, the impact, if the offer is partial or two-tier, on the remaining shareholders and our future (especially with regard to the background of the offeror), the value of non-cash consideration, legal matters, the effect of the transaction on our customers and local community interests.

The above provisions could have the effect of depriving shareholders of any opportunity to sell their shares at a premium over prevailing market prices because takeovers frequently involve purchases of stock directly from shareholders at such a premium price. Further, to the extent these provisions make it less likely that a takeover attempt opposed by our incumbent Board of Directors and management will succeed, the effect could be to assist the Board of Directors and management in retaining their existing positions. In addition, our Articles of Incorporation also provide that the provisions outlined herein cannot be amended, altered, repealed, or replaced without the “super-majority” vote described above or the approval of a Majority of the Continuing Directors as defined above.

34

Transfer Agent

Our Transfer Agent is Transfer Online, Inc., 512 SE Salmon Street, Portland, OR 97214, Phone: 503-227-2950, Website: http://www.transferonline.com, email: info@transferonline.com, Our transfer agent is registered with the SEC.

Certain Anti-Takeover Effects

General. Certain provisions of Colorado law may have an anti-takeover effect and may delay or prevent a tender offer or other acquisition transaction that a shareholder might consider to be in his or her best interest. The summary of the provisions of Colorado law set forth below does not purport to be complete and is qualified in its entirety by reference to Colorado law.

The issuance of shares of preferred stock, the issuance of rights to purchase such shares, and the imposition of certain other adverse effects on any party contemplating a takeover could be used to discourage an unsolicited acquisition proposal. For instance, the issuance of our Series A Convertible Preferred Stock if the option to acquire such shares is exercised would impede a business combination by the voting and conversion rights that would enable a holder to block such a transaction. In addition, under certain circumstances, the issuance of preferred stock could adversely affect the voting power of holders of our common stock.

Under Colorado law, a director, in determining what he reasonably believes to be in or not opposed to the best interests of the corporation, does not need to consider only the interests of the corporation’s shareholders in any takeover matter but may also, in his discretion, may consider any of the following:

(i) The interests of the corporation’s employees, suppliers, creditors and customers;

(ii) The economy of the state and nation;

(iii) The impact of any action upon the communities in or near which the corporation’s facilities or operations are located;

(iv) The long-term interests of the corporation and its shareholders, including the possibility that those interests may be best served by the continued independence of the corporation; and

(v) Any other factors relevant to promoting or preserving public or community interests.

Because our Board of Directors is not required to make any determination on matters affecting potential takeovers solely based on its judgment as to the best interests of our shareholders, our board could act in a manner that would discourage an acquisition attempt or other transaction that some, or a majority, of our shareholders might believe to be in their best interests or in which such shareholders might receive a premium for their stock over the then market price of such stock. Our board presently does not intend to seek shareholder approval prior to the issuance of currently authorized stock, unless otherwise required by law or applicable stock exchange rules.

35

DIVIDEND POLICY

Since our inception, we have not paid any dividends on our common stock, and we currently expect that, for the foreseeable future, all earnings (if any) will be retained for the development of our business and no dividends will be declared or paid. In the future, our Board of Directors may decide, at their discretion, whether dividends may be declared and paid, taking into consideration, among other things, our earnings (if any), operating results, financial condition and capital requirements, general business conditions and other pertinent facts.

SHARES ELIGIBLE FOR FUTURE SALE

Prior to this Offering, there has been a limited market for our Common Stock. Future sales of substantial amounts of our Common Stock, or securities or instruments convertible into our Common Stock, in the public market, or the perception that such sales may occur, could adversely affect the market price of our Common Stock prevailing from time to time. Furthermore, because there will be limits on the number of shares available for resale shortly after this Offering due to contractual and legal restrictions described below, there may be resales of substantial amounts of our Common Stock in the public market after those restrictions lapse. This could adversely affect the market price of our Common Stock prevailing at that time.

Upon completion of this Offering, assuming the maximum amount of shares of Common Stock offered in this Offering are sold, there will be 208,375,822 shares of our Common Stock outstanding.

Rule 144

In general, a person who has beneficially owned restricted shares of our Common Stock for at least twelve months, in the event we are a reporting company under Regulation A, or at least six months, in the event we have been a reporting company under the Exchange Act for at least 90 days before the sale, would be entitled to sell such securities, provided that such person is not deemed to be an affiliate of ours at the time of sale or to have been an affiliate of ours at any time during the 90 days preceding the sale. A person who is an affiliate of ours at such time would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of shares that does not exceed the greater of the following:

● 1% of the number of shares of our Common Stock then outstanding; or

● the average weekly trading volume of our Common Stock during the four calendar weeks preceding the filing by such person of a notice on Form 144 with respect to the sale;

provided that, in each case, we are subject to the periodic reporting requirements of the Exchange Act for at least 90 days before the sale. Rule 144 trades must also comply with the manner of sale, notice and other provisions of Rule 144, to the extent applicable.

LEGAL MATTERS 

Certain legal matters with respect to the shares of common stock offered hereby will be passed upon by John E. Lux, Esq. of Washington, D.C.

EXPERTS

The consolidated financial statements of the Company appearing elsewhere in this Offering Circular have been prepared by management and have not been reviewed by an independent accountant.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a Regulation A Offering Statement on Form 1-A under the Securities Act with respect to the shares of common stock offered hereby. This Offering Circular, which constitutes a part of the Offering Statement, does not contain all of the information set forth in the Offering Statement or the exhibits and schedules filed therewith. For further information about us and the common stock offered hereby, we refer you to the Offering Statement and the exhibits and schedules filed therewith. Statements contained in this Offering Circular regarding the contents of any contract or other document that is filed as an exhibit to the Offering Statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the Offering Statement. Upon the completion of this Offering, we will be required to file periodic reports, proxy statements, and other information with the SEC pursuant to the Securities Exchange Act of 1934. You may read and copy this information at the SEC’s Public Reference Room, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet website that contains reports, proxy statements and other information about issuers, including us, that file electronically with the SEC. The address of this site is www.sec.gov. 

36

Converde Energy USA, Inc. - XFUL

Profit & Loss

	2016			2015
Income
Sales		10,508			-
Total Income		10,508			-
Gross Profit		10,508			-
Expense
Advertising and Promotion		2,141			377
Automobile Expense		396			819
Bank Service Charges		87			69
Dues and Subscriptions		366			1,225
Meals and Entertainment		294			517
Office Supplies		307			1,114
Postage and Delivery		39			40
Professional Fees		30,792			22,985
Travel		177			725
Total Expense		34,599			27,871
Net Income		(24,091	)		(27,871	)

F-1

Converde Energy USA, Inc. - XFUL

Balance Sheet - Year Ending

	2016			2015
Assets
Checking		5,231			115,322
AIR		250,000
Investments		77,551			77,551
Total Current Assets		332,782			192,873
Total Assets		332,782			192,873
Liabilities & Capital
Accounts Payable		-
Convertible Notes		270,000
Total Liabilities		270,000
Stockholders' Equity
Common Stock		21,382			21,382
Common B		56,000			56,000
Preferred		215,499			215,499
Additional Paid in Capital		-
Retained Earnings		(230,099	)	$	(100,008	)
Total Stockholders' Equity		62,782			192873
Total Liabilities & Stockholders' Equity		332,782			192,873

F-2

Converde Energy USA, Inc. – XFUL

Statement of Cash Flows

	2016			2015
Cash Flow from Operating Activities
Net Income	$	(24,091	)	$	(27,871	)
Increase in A/R		(250,000	)		-
Net Cash Flows from Operating Activities		(274,091	)		(27,871	)
Cash Flow from Investing Activities
Net Cash Flows from Investing Activities		250,000
Cash Flows from Financing Activities
Investments		20,000			57,449
Withdrawals		(106,000	)		(25,000	)
Net Cash Flow from Financing Activities		(86,000	)		32,449
Net Increase (Decrease) in Cash		(110,091	)		4,578
Cash at Beginning of Year		115,322			110,744
Cash at End of Year		5,231			115,322

F-3

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Note 1. Nature of Business

Converde Energy USA, Inc. (Converde) is a publicly-traded company (OTC: XFUL) comprised of subsidiaries that source, treat and distribute reclaimed water in an effort to preserve our nation's naturally occurring resources. Together with Hydration Company of PA (sourcing, distributing) and American Energy Solutions (treating), Gilbert Oil and Gas Company provides value through net revenue interests, mineral interests and royalty rights.

Note 2. Summary of Significant Accounting Policies

Use of estimates:

The preparation of financial statements in conformity with 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. Accordingly, actual results could differ from those estimates.

Cash:

The Company classifies an investment with original maturities of three months or less as cash and cash equivalents.

Allowance for doubtful accounts:

The Company provides an allowance for doubtful accounts equal to the estimated collection losses that will be incurred in collection of all receivables. The estimated losses are based on managements' evaluation of outstanding accounts receivable at the end of the year. The allowance for doubtful accounts is $0 and $0 at December 31, 2016 and 2015, respectively. Amounts charged to bad debt expense are $0 and $0 for the years ended December 31, 2016 and 2015, respectively.

Inventory:

Inventory is stated at the lower of cost or market, which is determined by the first in, first out method of valuation. At December 31, 2016 and 2015, inventories were $0.

Depreciation and amortization:

Property and equipment are stated at cost. Depreciation on property and equipment is recorded using the straight-line method of depreciation over the estimated useful lives of depreciable assets which range from 7 to 10 years for equipment and automobiles and 40 years for improvements.

For federal income tax purposes, depreciation is computed using the accelerated cost recovery system and the modified accelerated cost recovery system. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred.

F-4

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Income taxes:

The Company has elected to be taxed as a C corporation. Accordingly, the accompanying financial statements do contain a provision for income taxes.

The federal income tax returns for 2013, 2014, 2015 and 2016 are subject to examination by the IRS, generally three years after they were filed.

The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law, and new authoritative rulings in determining any uncertain tax positions.

Shipping and handling fees and costs:

The Company classifies freight billed to customers as sales revenue and the related shipping and handling fees and costs to delivery expense as an operating expense.

Advertising:

The Company expenses advertising costs as incurred. Advertising expense for the years ended December 31, 2016 is $2,141 and 2015 was $0.

Research and development:

Research and development costs are expensed as incurred. Engineering and development expenses included research and development expenses of $0 for the years ended December 31, 2016 and 2015.

Date of management's review:

The Company has evaluated subsequent events through, the date on which the financial statements were available to be issued.

Note 3. Line of Credit

The company currently does not have a line of credit.

Note 4. Commitments

The Company does not have any current commitments as of December 31, 2016.

Note 5. Profit Sharing Plan

The Company does not engage in a retirement plan for its employees.

F-5

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Note 6. Major Customer

There was one major customer that accounted for 100% of sales during 2016. There were no major customers during 2015.

Note 7. Concentration of Credit Risk

The Company maintains its cash in one bank in one deposit account which at times exceed the federal insured limits. The Company has not experienced any losses in such accounts.

F-6

OTC Pink Basic Disclosure Guidelines

1) Name of the issuer and its predecessors (if any)

In answering this item, please also provide any names used by predecessor entities in the past five years and the dates of the name changes.

W2 Energy, Inc. 9/15/2014

2) Address of the issuer's principal executive offices

Company Headquarters  

Address 1: PO Box 443 Allentown, PA 18105

Address 2:                

Address 3:                

Phone: 610-217-3275

Email: brad@americanenergy-inc.com 

Website(s): http://www.americanenergy-inc.com

IR Contact

Address 1:

Address 2:                

Address 3:                

Phone:                

Email: contact@americanenergy-inc.com Website(s):

3) Security Information

Trading Symbol: XFUL

Exact title and class of securities outstanding: Common

CUSIP: 92934U309

Par or Stated Value: $.0001

Total shares authorized: 5,000,000,000                                as of: 2/14/2017

Total shares outstanding: 21,382,184                                  as of: 2/14/2017

Transfer Agent

Name: Transfer Online, Inc.

Address 1: 512 SE Salmon Street, Portland, OR 97214

Address 2:                

Address 3:                

Phone: (503) 227-2950

Is the Transfer Agent registered under the Exchange Act?*         Yes: ☒   No: ☐

*To be included in the OTC Pink Current Information tier, the transfer agent must be registered under the Exchange Act.

List any restrictions on the transfer of security:

Describe any trading suspension orders issued by the SEC in the past 12 months.

F-7

List any stock split, stock dividend, recapitalization, merger, acquisition, spin-off, or reorganization either currently anticipated or that occurred within the past 12 months:

Share Exchange Agreement w/ Hydration Company of PA, LLC 1/13/2017

4) Issuance History

List below any events, in chronological order, that resulted in changes in total shares outstanding by the issuer in the past two fiscal years and any interim period. The list shall include all offerings of equity securities, including debt convertible into equity securities, whether private or public, and all shares or any other securities or options to acquire such securities issued for services, describing (1) the securities, (2) the persons or entities to whom such securities were issued and (3) the services provided by such persons or entities. The list shall indicate:

A. The nature of each offering (e.g., Securities Act Rule 504, intrastate, etc.);

B. Any jurisdictions where the offering was registered or qualified;

C. The number of shares offered;

D. The number of shares sold;

E. The price at which the shares were offered, and the amount actually paid to the issuer;

F. The trading status of the shares; and

G. Whether the certificates or other documents that evidence the shares contain a legend (1) stating that the shares have not been registered under the Securities Act and (2) setting forth or referring to the restrictions on transferability and sale of the shares under the Securities Act.

5) Financial Statements

Provide the financial statements described below for the most recent fiscal year end or quarter end to maintain qualification for the OTC Pink Current Information tier. For the initial disclosure statement (qualifying for Current Information for the first time) please provide reports for the two previous fiscal years and any interim periods.

A. Balance sheet;

B. Statement of income;

C. Statement of cash flows;

D. Financial notes; and

E. Audit letter, if audited

F-8

The financial statements requested pursuant to this item shall be prepared in accordance with US GAAP by persons with sufficient financial skills.

You may either (i) attach/append the financial statements to this disclosure statement or (ii) post such financial statements through the OTC Disclosure & News Service as a separate report using the appropriate report name for the applicable period end. ("Annual Report," "Quarterly Report" or "Interim Report).

If you choose to publish the financial reports separately as described in part (ii) above, you must state in the accompanying disclosure statement that such financial statements are incorporated by reference. You may reference the document(s) containing the required financial statements by indicating the document name, period end date, and the date that it was posted to otciq.com in the field below.

Information contained in a Financial Report is considered current until the due date for the subsequent Financial Report. To remain in the OTC Pink Current Information tier, a company must post its Annual Report within 90 days from its fiscal year-end date and Quarterly Reports within 45 days of its fiscal quarter-end date.

6) Describe the Issuer's Business, Products and Services

Describe the issuer's business so a potential investor can clearly understand the company. In answering this item, please include the following:

A. a description of the issuer's business operations;

Converde's group of companies focus on providing solutions in the space where energy production and water meet technology. Our subsidiaries own energy operations as well as design, build and operate regional water treatment facilities that serve the industrial and energy sectors.

B. Date and State (or Jurisdiction) of Incorporation:

C. the issuer's primary and secondary SIC Codes;

D. the issuer's fiscal year end date; December 31st

E. principal products or services, and their markets;

Water sourcing, treatment, & distribution in industrial & government markets. Acquisition of oil & gas assets.

7) Describe the Issuer's Facilities

The goal of this section is to provide a potential investor with a clear understanding of all assets, properties or facilities owned, used or leased by the issuer.

In responding to this item, please clearly describe the assets, properties or facilities of the issuer, give the location of the principal plants and other property of the issuer and describe the condition of the properties. If the issuer does not have complete ownership or control of the property (for example, if others also own the property or if there is a mortgage on the property), describe the limitations on the ownership.

If the issuer leases any assets, properties or facilities, clearly describe them as above and the terms of their leases.

F-9

Patent Pending

8) Officers, Directors, and Control Persons

The goal of this section is to provide an investor with a clear understanding of the identity of all the persons or entities that are involved in managing, controlling or advising the operations, business development and disclosure of the issuer, as well as the identity of any significant shareholders.

A. Names of Officers, Directors, and Control Persons. In responding to this item, please provide the names of each of the issuer's executive officers, directors, general partners and control persons (control persons are beneficial owners of more than five percent (5%) of any class of the issuer's equity securities), as of the date of this information statement.

Brad Dom itrovitsch

B. Legal/Disciplinary History. Please identify whether any of the foregoing persons have, in the last five years, been the subject of:

1. A conviction in a criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses);

N/A

2. The entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person's involvement in any type of business, securities, commodities, or banking activities;

N/A

3. A finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or

N/A

4. The entry of an order by a self-regulatory organization that permanently or temporarily barred suspended or otherwise limited such person's involvement in any type of business or securities activities.

N/A

C. Beneficial Shareholders. Provide a list of the name, address and shareholdings or the percentage of shares owned by all persons beneficially owning more than ten percent (10%) of any class of the issuer's equity securities. If any of the beneficial shareholders are corporate shareholders, provide the name and address of the person(s) owning or controlling such corporate shareholders and the resident agents of the corporate shareholders.

Brad Dom itrovitsch

9) Third Party Providers

Please provide the name, address, telephone number, and email address of each of the following outside providers that advise your company on matters relating to operations, business development and disclosure:

Legal Counsel

Name: Will Hart

F-10

Firm: Hart & Hart

Address 1: 1624 Washington Street 

Denver, CO 80203 

Address 2:              

Phone: 303-839-0061 

Email: will@hartbusinesslaw.com

Accountant or Auditor

Name: Jack Lisicky

Firm: Buckno Lisicky & Co.

Address 1: 645 Hamilton Street Allentown, PA 18101

Address 2: _____
Phone: 610-821-8580

Email:                  

Investor Relations Consultant

Name:                  

Firm:                  

Address 1:                  

Address 2:                  

Phone:                  

Email:                   

Other Advisor: Any other advisor(s) that assisted, advised, prepared or provided information with respect to this disclosure statement.

Name:                  

Firm:                  

Address 1:                  

Address 2:                  

Phone:                  

Email:                   

10) Issuer Certification

The issuer shall include certifications by the chief executive officer and chief financial officer of the issuer (or any other persons with different titles, but having the same responsibilities).

The certifications shall follow the format below:

I, Brad Domitrovitsch certify that:

1. I have reviewed this Annual Disclosure Statement of XFUL;

2. Based on my knowledge, this disclosure statement does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this disclosure statement; and

3. Based on my knowledge, the financial statements, and other financial information included or incorporated by reference in this disclosure statement, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.

2/28/2017

[CEO's Signature]

 

[CFO's Signature]

 

F-11

Converde Energy USA, Inc. Profit & Loss
Q1 2017

Income
Sales	6,600
Total Income	6,600
Gross Profit	6,600
Expense
Advertising and Promotion	2,300
Automobile Expense	-
Bank Service Charges	108
Dues and Subscriptions	8,540
Meals and Entertainment	133
Office Supplies	902
Postage and Delivery	8
Professional Fees	17,500
Travel	242
Total Expense	29,733
Net Income	(23,133	)

F-12

Converde Energy USA, Inc.
Balance Sheet - Q1 2017

Assets
Checking	5,498
A/R	106,600
Investments	77,551
Total Current Assets	189,649
Total Assets	189,649
Liabilities & Capital
Accounts Payable	-
Convertible Notes	120,000
Total Liabilities	120,000
Stockholders' Equity
Common Stock	167,516
Common B	250,000
Preferred	750,000
Additional Paid in Capital	29,940
Retained Earnings	(1,127,807	)
Total Stockholders' Equity	69,649
Total Liabilities & Stockholders' Equity	189,649
Total Liabilities & Capital

F-13

Converde Energy USA, Inc. - XFUL
Statement of Cash Flows - Q1 2017

	Q1 2017
Cash Flow from Operating Activities
Net Income		(23,133	)
Increase in A/R		(106,600	)
Net Cash Flows from Operating Activities		(129,733	)
Cash Flow from Investing Activities
Net Cash Flows from Investing Activities		100,000
Capital Contributions		30,000
Cash Flows from Financing Activities
Investments		-
Withdrawals		-
Net Cash Flow from Financing Activities		-
Net Increase (Decrease) in Cash		267
Cash at Beginning of Quarter		5,231
Cash at End of Quarter		5,498

F-14

OTC Pink Basic Disclosure Guidelines

1) Name of the issuer and its predecessors (if any)

In answering this item, please also provide any names used by predecessor entities in the past five years and the dates of the name changes.

W2 Energy, Inc. 9/15/2014

2) Address of the issuer’s principal executive offices

Company Headquarters

Address 1: PO Box 443 Allentown, PA 18105

Address 2: _____

Address 3: _____

Phone: 610-217-3275

Email: brad@americanenergy-inc.com

Website(s): http://www.americanenergy-inc.com

IR Contact

Address 1:

Address 2:_____

Address 3:_____

Phone:_____

Email: contact@americanenergy-inc.com

Website(s): _____

3) Security Information

Trading Symbol: XFUL

Exact title and class of securities outstanding: Common

CUSIP: 92934U309

Par or Stated Value: $.0001

Total shares authorized: 5,000,000,000                  as of: 3/31/2017

Total shares outstanding: 166,442,184                  as of: 3/31/2017

Transfer Agent

Name: Transfer Online, Inc.

Address 1: 512 SE Salmon Street, Portland, OR 97214

Address 2: _____

Address 3: _____

Phone: (503) 227-2950

Is the Transfer Agent registered under the Exchange Act?*        Yes: ☒ No:☐

*To be included in the OTC Pink Current Information tier, the transfer agent must be registered under the Exchange Act.

List any restrictions on the transfer of security:

Describe any trading suspension orders issued by the SEC in the past 12 months.

F-15

List any stock split, stock dividend, recapitalization, merger, acquisition, spin-off, or reorganization either currently anticipated or that occurred within the past 12 months:

Share Exchange Agreement w/ Hydration Company of PA, LLC 1/13/2017

4) Issuance History

List below any events, in chronological order, that resulted in changes in total shares outstanding by the issuer in the past two fiscal years and any interim period. The list shall include all offerings of equity securities, including debt convertible into equity securities, whether private or public, and all shares or any other securities or options to acquire such securities issued for services, describing (1) the securities, (2) the persons or entities to whom such securities were issued and (3) the services provided by such persons or entities. The list shall indicate:

A. The nature of each offering (e.g., Securities Act Rule 504, intrastate, etc.); Debt convertible into equity securities (Bad debt)

B. Any jurisdictions where the offering was registered or qualified;

______

C.	The number of shares offered;
40,000,000

D.	The number of shares sold;
40,000,000

E.	The price at which the shares were offered, and the amount actually paid to the issuer;
.0025

F.	The trading status of the shares; and
Unrestricted

G. Whether the certificates or other documents that evidence the shares contain a legend (1) stating that the shares have not been registered under the Securities Act and (2) setting forth or referring to the restrictions on transferability and sale of the shares under the Securities Act.

______

5) Financial Statements

Provide the financial statements described below for the most recent fiscal year end or quarter end to maintain qualification for the OTC Pink Current Information tier. For the initial disclosure statement (qualifying for Current Information for the first time) please provide reports for the two previous fiscal years and any interim periods.

A. Balance sheet;

B. Statement of income;

C. Statement of cash flows;

D. Financial notes; and

E. Audit letter, if audited

F-16

The financial statements requested pursuant to this item shall be prepared in accordance with US GAAP by persons with sufficient financial skills.

You may either (i) attach/append the financial statements to this disclosure statement or (ii) post such financial statements through the OTC Disclosure & News Service as a separate report using the appropriate report name for the applicable period end. (“Annual Report,” “Quarterly Report” or “Interim Report”).

If you choose to publish the financial reports separately as described in part (ii) above, you must state in the accompanying disclosure statement that such financial statements are incorporated by reference. You may reference the document(s) containing the required financial statements by indicating the document name, period end date, and the date that it was posted to otciq.com in the field below.

______

Information contained in a Financial Report is considered current until the due date for the subsequent Financial Report. To remain in the OTC Pink Current Information tier, a company must post its Annual Report within 90 days from its fiscal year-end date and Quarterly Reports within 45 days of its fiscal quarter-end date.

6) Describe the Issuer’s Business, Products and Services

Describe the issuer’s business so a potential investor can clearly understand the company. In answering this item, please include the following:

A. a description of the issuer’s business operations;

Converde’s group of companies focus on providing solutions in the space where energy production and water meet technology. Our subsidiaries own energy operations as well as design, build and operate regional water treatment facilities that serve the industrial and energy sectors.

B. Date and State (or Jurisdiction) of Incorporation:

October 12, 2004 - Nevada

C. the issuer’s primary and secondary SIC Codes;

______

D. the issuer’s fiscal year end date; December 31st

E. principal products or services, and their markets;

Water sourcing, treatment, & distribution in industrial & government markets. Acquisition of oil & gas assets.

7) Describe the Issuer’s Facilities

The goal of this section is to provide a potential investor with a clear understanding of all assets, properties or facilities owned, used or leased by the issuer.

In responding to this item, please clearly describe the assets, properties or facilities of the issuer, give the location of the principal plants and other property of the issuer and describe the condition of the properties. If the issuer does not have complete ownership or control of the property (for example, if others also own the property or if there is a mortgage on the property), describe the limitations on the ownership.

If the issuer leases any assets, properties or facilities, clearly describe them as above and the terms of their leases.

Patent Pending

F-17

8) Officers, Directors, and Control Persons

The goal of this section is to provide an investor with a clear understanding of the identity of all the persons or entities that are involved in managing, controlling or advising the operations, business development and disclosure of the issuer, as well as the identity of any significant shareholders.

A. Names of Officers, Directors, and Control Persons. In responding to this item, please provide the names of each of the issuer’s executive officers, directors, general partners and control persons (control persons are beneficial owners of more than five percent (5%) of any class of the issuer’s equity securities), as of the date of this information statement.

Brad Domitrovitsch – 50.47% Common, 71.27% Preferred,77.60% Common B

B. Legal/Disciplinary History. Please identify whether any of the foregoing persons have, in the last five years, been the subject of:

1. A conviction in a criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses);

N/A

2. The entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person’s involvement in any type of business, securities, commodities, or banking activities;

N/A

3. A finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or

N/A

4. The entry of an order by a self-regulatory organization that permanently or temporarily barred suspended or otherwise limited such person’s involvement in any type of business or securities activities.

N/A

C. Beneficial Shareholders. Provide a list of the name, address and shareholdings or the percentage of shares owned by all persons beneficially owning more than ten percent (10%) of any class of the issuer’s equity securities. If any of the beneficial shareholders are corporate shareholders, provide the name and address of the person(s) owning or controlling such corporate shareholders and the resident agents of the corporate shareholders.

Brad Domitrovitsch

9) Third Party Providers

Please provide the name, address, telephone number, and email address of each of the following outside providers that advise your company on matters relating to operations, business development and disclosure:

Legal Counsel

Name: Will Hart

F-18

Firm: Hart & Hart

Address 1: 1624 Washington Street

Denver, CO 80203

Address 2: ______

Phone: 303-839-0061

Email: will@hartbusinesslaw.com

Accountant or Auditor

Name: Jack Lisicky

Firm: Buckno Lisicky & Co.  

Address 1: 645 Hamilton Street Allentown, PA 18101

Address 2:_____

Phone: 610-821-8580

Email: ______

Investor Relations Consultant

Name: ______

Firm: ______

Address 1: ______

Address 2: ______

Phone: ______

Email: ______

Other Advisor: Any other advisor(s) that assisted, advised, prepared or provided information with respect to this disclosure statement.

Name:_____ 

Firm: ______

Address 1:______

Address 2: ______

Phone:______

Email: ______

10) Issuer Certification

The issuer shall include certifications by the chief executive officer and chief financial officer of the issuer (or any other persons with different titles, but having the same responsibilities).

The certifications shall follow the format below:

I, Brad Domitrovitsch certify that:

1.    I have reviewed this Annual Disclosure Statement of XFUL;

2.    Based on my knowledge, this disclosure statement does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this disclosure statement; and

3.    Based on my knowledge, the financial statements, and other financial information included or incorporated by reference in this disclosure statement, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.

3/31/2017

[CEO’s Signature]

[CFO’s Signature]

F-19

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Note 1. Nature of Business

Converde Energy USA, Inc. (Converde) is a publicly-traded company (OTC: XFUL) comprised of subsidiaries that source, treat and distribute reclaimed water in an effort to preserve our nation’s naturally occurring resources. Together with Hydration Company of PA (sourcing, distributing) and American Energy Solutions (treating), Gilbert Oil and Gas Company provides value through net revenue interests, mineral interests and royalty rights.

Note 2. Summary of Significant Accounting Policies

Use of estimates:

The preparation of financial statements in conformity with 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. Accordingly, actual results could differ from those estimates.

Cash:

The Company classifies an investment with original maturities of three months or less as cash and cash equivalents.

Allowance for doubtful accounts:

The Company provides an allowance for doubtful accounts equal to the estimated collection losses that will be incurred in collection of all receivables. The estimated losses are based on managements’ evaluation of outstanding accounts receivable at the end of the year. The allowance for doubtful accounts is $0 for the end of the first quarter 2017. Amounts charged to bad debt expense are $0 for the end of the first quarter 2017.

Inventory:

Inventory is stated at the lower of cost or market, which is determined by the first in, first out method of valuation. At March 31^st 2017, inventories were $0.

Depreciation and amortization:

Property and equipment are stated at cost. Depreciation on property and equipment is recorded using the straight-line method of depreciation over the estimated useful lives of depreciable assets which range from 7 to 10 years for equipment and automobiles and 40 years for improvements.

For federal income tax purposes, depreciation is computed using the accelerated cost recovery system and the modified accelerated cost recovery system. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred.

F-20

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Income taxes:

The Company has elected to be taxed as a C corporation. Accordingly, the accompanying financial statements do contain a provision for income taxes.

The federal income tax returns for 2013, 2014, 2015 and 2016 are subject to examination by the IRS, generally three years after they were filed.

The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law, and new authoritative rulings in determining any uncertain tax positions.

Shipping and handling fees and costs:

The Company classifies freight billed to customers as sales revenue and the related shipping and handling fees and costs to delivery expense as an operating expense.

Advertising:

The Company expenses advertising costs as incurred. Advertising expense for the end of the first quarter 2017 was $2,300.

Research and development:

Research and development costs are expensed as incurred. Engineering and development expenses included research and development expenses of $0 for the end of the first quarter 2017.

Date of management’s review:

The Company has evaluated subsequent events through, the date on which the financial statements were available to be issued.

Note 3. Line of Credit

The company currently does not have a line of credit.

Note 4. Commitments

The Company does not have any current commitments as of March 31, 2017.

Note 5. Profit Sharing Plan

The Company does not engage in a retirement plan for its employees.

Note 6. Major Customer

There was one major customer that accounted for 100% of sales during the first quarter of 2017.

F-21

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Note 7. Concentration of Credit Risk

The Company maintains its cash in one bank in one deposit account which at times exceed the federal insured limits. The Company has not experienced any losses in such accounts.

Note 8. Bad or Aged Debt

In the first quarter of 2017 the Company reduced its liabilities associated with aged debt by $100,000. As a result, the Company cut its aged debt exposure in half.

F-22

Converde Energy USA, Inc.

Income Statement - Q2 2017

Ordinary Income/Expense		0
Expense
Advertising and Promotion		1,642
Bank Service Charges		108
Dues & Subscriptions		1,604
Meals and Entertainment		0
Office Supplies		0
Professional Fees		750
Travel Expense		0
Total Expense		4,104
Net Ordinary Income		-4,104
Net Income	$	(4,104	)

F-23

Converde Energy USA, Inc.
Balance Sheet - Q2 2017

Assets
Checking		1,394
A/R		206,600
Investments		77,551
Total Current Assets		285,545
Total Assets		285,545
Liabilities & Capital
Accounts Payable		-
Convertible Notes		220,000
Total Liabilities		220,000
Stockholders' Equity
Common Stock	$	167,516
Common B	$	250,000
Preferred	$	750,000
Additional Paid in Capital	$	29,940
Retained Earnings	$	(1,131,911	)
Total Stockholder Equity	$	65,545
Total Liabilities & Capital		285,545

F-24

Converde Energy USA, Inc.

Statement of Cash Flows - Q2 2017

	Q2 2017			Q1 2017
Cash Flow from Operating Activities
Net Income		(4,104	)		(23,133	)
Increase in A/R		(100,000	)		(106,600	)
Net Cash Flows from Operating Activities		(104,104	)		(129,733	)
Cash Flow from Investing Activities
Net Cash Flows from Investing Activities		100,000			100,000
Capital Contributions		-			30,000
Cash Flows from Financing Activities
Investments		-			-
Withdrawals		-			-
Net Cash Flow from Financing Activities		-			-
Net Increase (Decrease) in Cash		(4,104	)		267
Cash at Beginning of Quarter		5,498			5,231
Cash at End of Quarter		1,394			5,498

F-25

OTC Pink Basic Disclosure Guidelines

1) Name of the issuer and its predecessors (if any)

In answering this item, please also provide any names used by predecessor entities in the past five years and the dates of the name changes.

W2 Energy, Inc. 9/15/2014

2) Address of the issuer’s principal executive offices

Company Headquarters

Address 1: PO Box 443 Allentown, PA 18105

Address 2: ______

Address 3: ______

Phone: 610-217-3275

Email: brad@americanenergy-inc.com

Website(s): http://www.americanenergy-inc.com

IR Contact

Address 1:

Address 2: ______

Address 3: ______

Phone: ______

Email: contact@americanenergy-inc.com

Website(s): ______

3) Security Information

Trading Symbol: XFUL

Exact title and class of securities outstanding: Common

CUSIP: 92934U309

Par or Stated Value: $.001

Total shares authorized: 5,000,000,000                             as of: 6/30/2017

Total shares outstanding: 167,516,432                             as of: 6/30/2017

Transfer Agent

Name: Transfer Online, Inc.

Address 1: 512 SE Salmon Street, Portland, OR 97214

Address 2: ______

Address 3:______

Phone: (503) 227-2950

Is the Transfer Agent registered under the Exchange Act?*        Yes:☒ No:☐

*To be included in the OTC Pink Current Information tier, the transfer agent must be registered under the Exchange Act.

List any restrictions on the transfer of security:

Describe any trading suspension orders issued by the SEC in the past 12 months.

F-26

List any stock split, stock dividend, recapitalization, merger, acquisition, spin-off, or reorganization either currently anticipated or that occurred within the past 12 months:

Share Exchange Agreement w/ Hydration Company of PA, LLC 1/13/2017

4) Issuance History

List below any events, in chronological order, that resulted in changes in total shares outstanding by the issuer in the past two fiscal years and any interim period. The list shall include all offerings of equity securities, including debt convertible into equity securities, whether private or public, and all shares or any other securities or options to acquire such securities issued for services, describing (1) the securities, (2) the persons or entities to whom such securities were issued and (3) the services provided by such persons or entities. The list shall indicate:

A. The nature of each offering (e.g., Securities Act Rule 504, intrastate, etc.); Q1 2017 - Debt convertible into equity securities (Bad debt)

B. Any jurisdictions where the offering was registered or qualified;

_____

C. The number of shares offered;

Q1 2017 - 40,000,000

D. The number of shares sold;

Q1 2017 - 40,000,000

E. The price at which the shares were offered, and the amount actually paid to the issuer;

Q1 2017 - .0025

F.	The trading status of the shares; and
Unrestricted

G. Whether the certificates or other documents that evidence the shares contain a legend (1) stating that the shares have not been registered under the Securities Act and (2) setting forth or referring to the restrictions on transferability and sale of the shares under the Securities Act.

_____

5) Financial Statements

Provide the financial statements described below for the most recent fiscal year end or quarter end to maintain qualification for the OTC Pink Current Information tier. For the initial disclosure statement (qualifying for Current Information for the first time) please provide reports for the two previous fiscal years and any interim periods.

A. Balance sheet;

B. Statement of income;

C. Statement of cash flows;

D. Financial notes; and

E. Audit letter, if audited

F-27

The financial statements requested pursuant to this item shall be prepared in accordance with US GAAP by persons with sufficient financial skills.

You may either (i) attach/append the financial statements to this disclosure statement or (ii) post such financial statements through the OTC Disclosure & News Service as a separate report using the appropriate report name for the applicable period end. (“Annual Report,” “Quarterly Report” or “Interim Report”).

If you choose to publish the financial reports separately as described in part (ii) above, you must state in the accompanying disclosure statement that such financial statements are incorporated by reference. You may reference the document(s) containing the required financial statements by indicating the document name, period end date, and the date that it was posted to otciq.com in the field below.

_____

Information contained in a Financial Report is considered current until the due date for the subsequent Financial Report. To remain in the OTC Pink Current Information tier, a company must post its Annual Report within 90 days from its fiscal year-end date and Quarterly Reports within 45 days of its fiscal quarter-end date.

6) Describe the Issuer’s Business, Products and Services

Describe the issuer’s business so a potential investor can clearly understand the company. In answering this item, please include the following:

A. a description of the issuer’s business operations;

Converde’s group of companies focus on providing solutions in the space where energy production and water meet technology. Our subsidiaries own energy operations as well as design, build and operate regional water treatment facilities that serve the industrial and energy sectors.

B. Date and State (or Jurisdiction) of Incorporation:

October 12, 2004 - Nevada

C. the issuer’s primary and secondary SIC Codes;

_____

D. the issuer’s fiscal year end date;

December 31st

E. principal products or services, and their markets;

Water sourcing, treatment, & distribution in industrial & government markets. Acquisition of oil & gas assets.

7) Describe the Issuer’s Facilities

The goal of this section is to provide a potential investor with a clear understanding of all assets, properties or facilities owned, used or leased by the issuer.

In responding to this item, please clearly describe the assets, properties or facilities of the issuer, give the location of the principal plants and other property of the issuer and describe the condition of the properties. If the issuer does not have complete ownership or control of the property (for example, if others also own the property or if there is a mortgage on the property), describe the limitations on the ownership.

If the issuer leases any assets, properties or facilities, clearly describe them as above and the terms of their leases.

F-28

Patent Pending

8) Officers, Directors, and Control Persons

The goal of this section is to provide an investor with a clear understanding of the identity of all the persons or entities that are involved in managing, controlling or advising the operations, business development and disclosure of the issuer, as well as the identity of any significant shareholders.

A. Names of Officers, Directors, and Control Persons. In responding to this item, please provide the names of each of the issuer’s executive officers, directors, general partners and control persons (control persons are beneficial owners of more than five percent (5%) of any class of the issuer’s equity securities), as of the date of this information statement.

Brad Domitrovitsch – 50.47% Common, 71.27% Preferred,77.60% Common B

B. Legal/Disciplinary History. Please identify whether any of the foregoing persons have, in the last five years, been the subject of:

1. A conviction in a criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses);

N/A

2. The entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person’s involvement in any type of business, securities, commodities, or banking activities;

N/A

3. A finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or

N/A

4. The entry of an order by a self-regulatory organization that permanently or temporarily barred suspended or otherwise limited such person’s involvement in any type of business or securities activities.

N/A

C. Beneficial Shareholders. Provide a list of the name, address and shareholdings or the percentage of shares owned by all persons beneficially owning more than ten percent (10%) of any class of the issuer’s equity securities. If any of the beneficial shareholders are corporate shareholders, provide the name and address of the person(s) owning or controlling such corporate shareholders and the resident agents of the corporate shareholders.

Brad Domitrovitsch

9) Third Party Providers

Please provide the name, address, telephone number, and email address of each of the following outside providers that advise your company on matters relating to operations, business development and disclosure:

Legal Counsel

Name: Will Hart

F-29

Firm: Hart & Hart

Address 1: 1624 Washington Street

Denver, CO 80203

Address 2: _____

Phone: 303-839-0061

Email: will@hartbusinesslaw.com

Accountant or Auditor

Name: Jack Lisicky

Firm: Buckno Lisicky & Co.

Address 1: 645 Hamilton Street Allentown, PA 18101

Address 2:______

Phone: 610-821-8580

Email: _____

Investor Relations Consultant

Name: _____

Firm: _____

Address 1: _____

Address 2: _____

Phone: _____

Email: _____

Other Advisor: Any other advisor(s) that assisted, advised, prepared or provided information with respect to this disclosure statement.

Name: _____

Firm: _____

Address 1: _____

Address 2: _____

Phone: _____

Email: _____

10) Issuer Certification

The issuer shall include certifications by the chief executive officer and chief financial officer of the issuer (or any other persons with different titles, but having the same responsibilities).

The certifications shall follow the format below:

I, Brad Domitrovitsch certify that:

1.    I have reviewed this Annual Disclosure Statement of XFUL;

2.    Based on my knowledge, this disclosure statement does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this disclosure statement; and

3.    Based on my knowledge, the financial statements, and other financial information included or incorporated by reference in this disclosure statement, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.

6/30/2017

[CEO’s Signature]

[CEO’s Signature]

F-30

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Note 1. Nature of Business

Converde Energy USA, Inc. (Converde) is a publicly-traded company (OTC: XFUL) comprised of subsidiaries that source, treat and distribute reclaimed water in an effort to preserve our nation’s naturally occurring resources. Together with Hydration Company of PA (sourcing, distributing) and American Energy Solutions (treating), Gilbert Oil and Gas Company provides value through net revenue interests, mineral interests and royalty rights.

Note 2. Summary of Significant Accounting Policies

Use of estimates:

The preparation of financial statements in conformity with 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. Accordingly, actual results could differ from those estimates.

Cash:

The Company classifies an investment with original maturities of three months or less as cash and cash equivalents.

Allowance for doubtful accounts:

The Company provides an allowance for doubtful accounts equal to the estimated collection losses that will be incurred in collection of all receivables. The estimated losses are based on managements’ evaluation of outstanding accounts receivable at the end of the year. The allowance for doubtful accounts is $0 for the end of the second quarter 2017. Amounts charged to bad debt expense are $0 for the end of the second quarter 2017.

Inventory:

Inventory is stated at the lower of cost or market, which is determined by the first in, first out method of valuation. At June 30th 2017, inventories were $0.

Depreciation and amortization:

Property and equipment are stated at cost. Depreciation on property and equipment is recorded using the straight-line method of depreciation over the estimated useful lives of depreciable assets which range from 7 to 10 years for equipment and automobiles and 40 years for improvements.

For federal income tax purposes, depreciation is computed using the accelerated cost recovery system and the modified accelerated cost recovery system. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred.

F-31

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Income taxes:

The Company has elected to be taxed as a C corporation. Accordingly, the accompanying financial statements do contain a provision for income taxes.

The federal income tax returns for 2013, 2014, 2015 and 2016 are subject to examination by the IRS, generally three years after they were filed.

The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law, and new authoritative rulings in determining any uncertain tax positions.

Shipping and handling fees and costs:

The Company classifies freight billed to customers as sales revenue and the related shipping and handling fees and costs to delivery expense as an operating expense.

Advertising:

The Company expenses advertising costs as incurred. Advertising expense for the end of the second quarter 2017 was $1,642.

Research and development:

Research and development costs are expensed as incurred. Engineering and development expenses included research and development expenses of $0 for the end of the second quarter 2017.

Date of management’s review:

The Company has evaluated subsequent events through, the date on which the financial statements were available to be issued.

Note 3. Line of Credit

The company currently does not have a line of credit.

Note 4. Commitments

The Company does not have any current commitments as of June 30, 2017.

Note 5. Profit Sharing Plan

The Company does not engage in a retirement plan for its employees.

Note 6. Major Customer

There was no major customer that accounted for sales during the second quarter of 2017.

F-32

CONVERDE ENERGY USA, INC.

NOTES TO FINANCIAL STATEMENTS

Note 7. Concentration of Credit Risk

The Company maintains its cash in one bank in one deposit account which at times exceed the federal insured limits. The Company has not experienced any losses in such accounts.

Note 8. Bad or Aged Debt

The Company retained $100,000 of bad debt in the second quarter of 2017.

Note 9. Convertible Notes

The Company engaged Minivest to perform marketing services related to Company’s Regulation A Offering. Minivest received $100,000 convertible note yielding 8% with a maturity date of May 23, 2018 as compensation for said services.

F-33

PART III—EXHIBITS

Index to Exhibits

Exhibit No.	Exhibit Description
2.1	Articles of Incorporation
2.2	Bylaws
6.1	Employment Agreement for Brad Domitrovitsch
6.2	Patent Application
6.3	Mocanaqua Abandoned Mine Drainage (AMD) Tunnel contract
11.2	Consent of John E. Lux, Esq. (included in Exhibit 12.1)
12.1	Opinion of John E. Lux, Esq.

III-1

SIGNATURES

Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this Offering Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Allentown, State of Pennsylvania, on August 28, 2017.

(Exact name of issuer as specified in its charter):	American Energy Partners, Inc.
By (Signature and Title):	/s/ Brad Domitrovitsch
	Chief Executive Officer (Principal Executive Officer).

(Exact name of issuer as specified in its charter): American Energy Partners, Inc., Inc.

This Offering Statement has been signed by the following persons in the capacities and on the dates indicated.

(Signature):	/s/ Brad Domitrovitsch
(Title):	Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer).
(Date):	August 28, 2017

+SIGNATURES OF DIRECTORS

DIRECTORS:

/s/ Brad Domitrovitsch	August 28, 2017
Brad Domitrovitsch	Date

/s/ Josh C. Hickman	August 28, 2017
Josh Hickman	Date

III-2

EX1A-2A CHARTER

Exhibit 2.1

Amended Articles of Incorporation
of
American Energy Partners, Inc.
a Colorado corporation
formerly
Converde Energy USA, Inc.
a Nevada corporation

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Amended Articles of Incorporation
of
American Energy Partners, Inc.
a Colorado corporation
formerly
Converde Energy USA, Inc.
a Nevada corporation

Pursuant to the applicable provisions of Section 7-102-101 and Section 7-102-102 of the Colorado Revised Statutes (“CRS”), the undersigned incorporator, hereby adopts these Articles of Incorporation on behalf of the the shareholders of American Energy Partners, Inc. formerly Converde Energy USA,. Inc., a Nevada corporation.

Article 1. The name of the Corporation is: American Energy Partners, Inc.

Article 2. The duration of the Corporation is perpetual.

Article 3. The address of the registered office in the State of Colorado is 1624 Washington Street, Denver, CO 80203, United States; the name of the registered agent at such address is Hart & Hart, LLC.

Article 4. The purposes for which the Corporation is organized are:

(a) To engage, without limitation, in any lawful activity for which corporations may be organized under the Laws of the State of Colorado.

(b) To do such acts in pursuit of its general purposes as are not forbidden by the laws of the State of Colorado, as now in force or hereafter may be in force, including, but not limited to, the following:

(1) To sue, be sued, complain, and defend in its corporate name;

(2) To have a corporate seal which may be altered at will, and to use it, or a facsimile of it, by impressing or affixing it or in any other manner reproducing it;

(3) To make and amend bylaws, not inconsistent with its articles of incorporation or with the laws of this state, for managing the business and regulating the affairs of the corporation;

(4) To purchase, receive, lease, or otherwise acquire, own, hold, improve, use, and otherwise deal with real or personal property or any legal or equitable interest in property, wherever located;

(5) To sell, convey, mortgage, pledge, lease, exchange, and otherwise dispose of all or any part of its property;

(6) To purchase, receive, subscribe for, or otherwise acquire, own, hold, vote, use, sell, mortgage, lend, pledge, or otherwise dispose of, and deal in and with shares or other interests in, or obligations of, any other entity;

(7) To make contracts and guarantees, incur liabilities, borrow money, issue its notes, bonds, and other obligations (which may be convertible into or include the option to purchase other securities of the corporation), and secure any of its obligations by mortgage or pledge of any of its property, franchises, or income;

(8) To lend money, invest and reinvest its funds, and receive and hold real and personal property as security for repayment;

(9) To be a promoter, partner, member, associate, or manager of any partnership, joint venture, trust, or other entity;

(10) To conduct its business, locate offices, and exercise the powers granted by this chapter within or without this state;

(11) To elect directors and appoint officers, employees, and agents of the corporation, define their duties, fix their compensation, and lend them money and credit;

(12) To pay pensions and establish pension plans, pension trusts, profit sharing plans, share bonus plans, share option plans, and benefit or incentive plans for any or all of its current or former directors, officers, employees, and agents;

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(13) To make donations for the public welfare or for charitable, scientific, or educational purposes;

(14) To transact any lawful business that will aid governmental policy;

(15) To provide insurance for its benefit on the life or physical or mental ability of any of its directors, officers, or employees or any other person whose death or physical or mental disability might cause financial loss to the corporation; or, pursuant to any contractual arrangement with any shareholder concerning the reacquisition of shares owned by him at his death or disability, on the life or physical or mental ability of that shareholder, for the purpose of carrying out such contractual arrangement; or, pursuant to any contract obligating the corporation, as part of compensation arrangements, or pursuant to any contract obligating the corporation as guarantor or surety, on the life of the principal obligor, and for these purposes the corporation is deemed to have an insurable interest in such persons; and

(16) To make payments or donations or do any other act not inconsistent with law that furthers the business and affairs of the corporation.

Article 5. The maximum number of shares which the Corporation shall have the authority to issue is:

7,000,000,000 (Seven Billion) Shares of Common Stock having a par value of $0.001; and

(b) 1,000,000,000 (One Billion) Shares of Preferred Stock having a par value of $0.001 per share, such Preferred Stock being issuable in one or more series as hereinafter provided.

No holder of any class of stock of the Corporation shall be entitled, as a right, to purchase or subscribe for any part of any class of stock of the Corporation now authorized or hereafter authorized by any amendment of the Certificate of Incorporation, or of any bonds, debentures, or other securities convertible into or evidencing any rights to purchase or subscribe for any stock of the Corporation; and any stock now authorized or any such additional authorized issue of any stock or any securities convertible into or evidencing rights to purchase or subscribe for stock may be issued and disposed of by the Board of Directors to such firms, person, corporation or association for such consideration and upon such terms and in such manner as the Board of Directors may in its discretion determine without offering any thereof on the same terms, or on any terms, to the shareholders, or to any class of shareholders.

The preferences, restriction and qualifications applicable to the Common Stock and the Preferred Stock are as follows:

PART A - COMMON STOCK

The Common Stock of the Company shall be divided into two classes: Class A and Class B. There shall be Five Billion (5,000,000,000) shares of Class A Common Stock and Two Billion (2,000,000,000) shares of Class B common stock.

Each holder of Class A Common Stock shall be entitled to one vote for each share of such stock standing in his name on the books of the Corporation. The holders of the Class B Common Stock shall be entitled to Twenty (20) votes for each share of Class B Common Stock held.

After the payment or declaration and setting aside for payment of the full cumulative dividends for all prior and then current dividend periods; all outstanding shares of Preferred Stock and after setting aside all stock purchase funds or sinking funds heretofore required to be set aside with respect to the Preferred Stock, dividends on the Common Stock may be declared and paid, but only when and as determined by the Board of Directors.

On any dissolution, liquidation or winding up of the Corporation, after there shall have been paid to or set aside for the holders of all outstanding shares of Preferred Stock the full preferential amount to which they are respectively entitled to receive, pro rata in accordance with the number of shares of each class outstanding, all the remaining assets of the Corporation will be available for distribution to its common shareholders.

PART B - PREFERRED STOCK

The Board of Directors is expressly vested with the authority to divide any or all of the Preferred Stock into series and to fix and determine the relative rights and preferences of the shares of each series so established, provided, however, that the rights and preferences of the various series may vary only with respect to:

(a)  the rate of dividend;

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(b) whether the shares may be called and, if so, the call price and the terms and conditions of call;

(c)  the amount payable upon the shares in the event of voluntary and involuntary liquidation;

(d) sinking fund provisions, if any for the call or redemption of the shares;

(e)  the terms and conditions, if any, on which the shares may be converted;

(f)   voting rights; and

(g)  whether the shares will be cumulative, noncumulative or partially cumulative as to dividends and the dates from which any cumulative dividends are to accumulate.

The Board of Directors shall exercise the foregoing authority by adopting a resolution setting forth the designation of each series and the number of shares therein, and fixing and determining the relative rights and preferences thereof. The Board of Directors may make any change in the designations, terms, limitations or relative rights or preferences of any series in the same manner, so long as no shares of such series are outstanding at such time.

Within the limits and restrictions, if any, stated in any resolution of the Board of Directors originally fixing the number of shares constituting any series, the Board of Directors is authorized to increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series subsequent to the issue of shares of such series. In case the number of shares of any series shall be so decreased, the share constituting such decrease shall resume the status which they had prior to the adoption of the resolution originally fixing the number of shares of such series.

Class A Preferred Stock

There shall be authorized a Class of Preferred Stock to be designated the Class A Preferred Stock. The following establishes the voting powers, designations, preferences, limitations, restrictions and relative rights of the Class Preferred Stock:

1. Designation and Amount. The designation of this class of capital stock shall be “Class A Convertible Preferred Stock,” par value $0.001 per share (the “Class A Preferred Stock”). The number of shares, powers, terms, conditions, designations, preferences and privileges, relative, participating, optional and other special rights, and qualifications, limitations and restrictions, if any, of the Class A Preferred Stock shall be as set forth herein. The number of authorized shares of the Class A Preferred Stock is 1,000,000,000 shares.

2. Ranking. The Corporation’s Class A Preferred Stock shall rank, as to dividends and upon Liquidation (as defined in Section 4(b) hereof), senior and prior to the Corporation’s common stock, par value $0.001 per share (the “Common Stock”) and to all other classes or class of stock issued by the Corporation, except as otherwise approved by the affirmative vote or consent of the holders of a majority of the shares of Class A Preferred Stock pursuant to Section 6(c) hereof.

3. Dividend Provisions. The holders of shares of Class A Preferred Stock have no dividend rights except as may be declared by the Board of Directors of the Corporation in its sole and absolute discretion, out of funds legally available for that purpose.

4. Liquidation Rights.

4(a) With respect to rights on Liquidation (as defined in Section 4(b) hereof), the Class A Preferred Stock shall rank senior and prior to the Corporation’s Common Stock and to all other classes or series of stock issued by the Corporation, except as otherwise approved by the affirmative vote or consent of the holders of at least a majority of Class A Preferred Stock outstanding pursuant to Section 6(a) hereof.

4(b)   In the event of any liquidation, dissolution or winding-up of the affairs of the Corporation (collectively, a “Liquidation”), the sole participation to which the holders of shares of Class A Preferred Stock then outstanding (the “Class A Preferred Stockholders”) shall be entitled, out of the assets of the Corporation legally available for distribution to its stockholders, whether from capital, surplus or earnings, to receive, before any payment shall be made to the holders of Common Stock or any other class or series of stock ranking on Liquidation junior to such Class A Preferred Stock, an amount per share equal to $1.00. If upon any such Liquidation of the Corporation, the remaining assets of the Corporation available for distribution to its stockholders shall be insufficient to pay the holders of shares of Class A Preferred Stock the full amount to which they shall be entitled, the holders of shares of Class A Preferred Stock and any class or series of stock ranking on liquidation on a parity with the Class A Preferred Stock shall share pari passu in any distribution of the remaining assets and funds of the Corporation in proportion to the respective liquidation amounts of the Preferred Stock that would otherwise be payable to the holders of Preferred Stock with respect to the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full.

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5. Voting. The Class A Preferred Stockholders shall be entitled to Twenty (20) votes for each share of Class A Preferred Stock held on any matters requiring a shareholder vote of the Corporation.

6. Conversion.

6(a) Any Class A Preferred Stockholder shall have the right, at any time from the date of issuance, to convert any or all of its Class A Preferred Stock into 20 shares of fully paid and nonassessable shares of Common Stock for each share of Class A Preferred Stock so converted. In any event, holders of Class A Preferred Stock will have the right to convert as described in this Section 6 upon an initial or secondary public offering of Common Stock by the Corporation or in the event of a change in control as defined in the Rules and Regulations of the Securities and Exchange Commission.

6(b)(i) Any Class A Preferred Stockholder may exercise the right to convert such shares into Common Stock pursuant to this Section 6 by delivering to the Corporation during regular business hours, at the office of the Corporation or any transfer agent of the Corporation or at such other place as may be designated by the Corporation, the certificate or certificates for the shares to be converted (the “Class A Preferred Certificate”), duly endorsed or assigned in blank to the Corporation (if required by it).

6(b)(ii) Each Class A Preferred Certificate shall be accompanied by written notice stating that such holder elects to convert such shares and stating the name or names (with address) in which the certificate or certificates for the shares of Common Stock (the “Common Certificate”) are to be issued. Such conversion shall be deemed to have been effected on the date when such delivery is made, and such date is referred to herein as the “Conversion Date.”

6(b)(iii) As promptly as practicable thereafter, the Corporation shall issue and deliver to or upon the written order of such holder, at the place designated by such holder, a certificate or certificates for the number of shares of Common Stock to which such holder is entitled.

6(b)(iv) The person in whose name the certificate or certificates for Common Stock are to be issued shall be deemed to have become a holder of record of Common Stock on the applicable Conversion Date, unless the transfer books of the Corporation are closed on such Conversion Date, in which event the holder shall be deemed to have become the stockholder of record on the next succeeding date on which the transfer books are open, provided that the Conversion Price shall be that Conversion Price in effect on the Conversion Date.

6(b)(v) Upon conversion of only a portion of the number of shares covered by a Class A Preferred Certificate, the Corporation shall issue and deliver to or upon the written order of the holder of such Class A Preferred Certificate, at the expense of the Corporation, a new certificate covering the number of shares of the Class A Preferred Stock representing the unconverted portion of the Class A Preferred Certificate, which new certificate shall entitle the holder thereof to all the rights, powers and privileges of a holder of such shares.

6(c)  The Corporation shall pay all documentary, stamp or other transactional taxes attributable to the issuance or delivery of shares of capital stock of the Corporation upon conversion of any shares of Class A Preferred Stock; provided, however, that the Corporation shall not be required to pay any taxes which may be payable in respect of any transfer involved in the issuance or delivery of any certificate for such shares in a name other than that of the Class A Preferred Stockholder in respect of which such shares of Class A Preferred Stock are being issued.

6(d) The Corporation shall reserve out of its authorized but unissued shares of Common Stock solely for the purpose of effecting the conversion of the Class A Preferred Stock sufficient shares of Common Stock to provide for the conversion of all outstanding shares of Class A Preferred Stock.

6(e)  All shares of Common Stock which may be issued in connection with the conversion provisions set forth herein will, upon issuance by the Corporation, be validly issued, fully paid and nonassessable, not subject to any preemptive or similar rights and free from all taxes, liens or charges with respect thereto created or imposed by the Corporation.

7. Certain Covenants.

Any registered holder of Class A Preferred Stock may proceed to protect and enforce its rights and the rights of such holders by any available remedy by proceeding at law or in equity to protect and enforce any such rights, whether for the specific enforcement of any provision in this Certificate of Designation or in aid of the exercise of any power granted here in, or to enforce any other proper remedy.

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8. Notice to the Corporation. All notices and other communications required or permitted to be given to the Corporation hereunder shall be made by first-class mail, postage prepaid, to the Corporation at its principal executive offices. Any notice to the stockholders shall me made to their address as set forth on the books and records of the Corporation.

Article 6. Conversion Into Colorado Corporation

These Articles are filed in connection with the conversion of Converde Energy USA, Inc., a Nevada corporation, into American Energy Partners, Inc. pursuant to which there shall be a One for Twenty (20) reverse split of the Common Stock of Converde Energy USA, Inc. into the Common Stock of American Energy Partners, Inc. pursuant to a Plan of Conversion. Subject to the terms and conditions of this Plan, at the Effective Time, automatically by virtue of the Conversion and without any further action on the part of Converde Energy USA,. Inc.-Nevada, American Energy Partners, Inc.-Colorado, any shareholder or stockholder, or any officer or director, thereof, respectively, each twenty (20) shares of common stock of all classes of Converde Energy USA,. Inc.- Nevada (the “Converde Energy USA,. Inc.-Nevada Common Stock”), shall convert into one validly issued, fully paid, and non-assessable share of common stock, par value $0.0001 per share, of the same class of Common Stock of American Energy Partners, Inc.-Colorado (the “American Energy Partners, Inc.-Colorado Common Stock”). American Energy Partners, Inc.-Colorado shall not issue fractional shares with respect to the Conversion. Any fractional share of American Energy Partners, Inc.-Colorado Common Stock that would otherwise be issued as a result of the Conversion will be rounded up to the nearest whole share. Following the Effective Time, all Converde Energy USA,. Inc.-Nevada Common Stock shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each holder of Converde Energy USA,. Inc.-Nevada Common Stock immediately prior to the Effective Time shall cease to have any rights with respect thereto. Such conversion shall not be effective until these actions, being the change of name, the change of corporate domicile and the reverse split of Common Stocks shall have been approved by FINRA.

Each Twenty shares of Common Stock of Converde Energy USA, Inc. shall be thus converted into one share of the Class A Common Stock of American Energy Partners, Inc. Each Twenty shares of Class B Common Stock of Converde Energy USA, Inc. shall be thus converted into one share of the Class B Common Stock of American Energy Partners, Inc.

Article 7. The shareholders of the Corporation may take any action which they are required or permitted to take without a meeting on written consent, setting forth the action so taken, signed by all of the persons or entities entitled to vote thereon.

Article 8. A. Any Business Combination Transaction (as defined in Section 8.B (3) below) shall require the affirmative vote of the holders of at least 80% of the voting power of all of the shares of capital stock of the Corporation then entitled to vote generally in the election of directors, voting together as a single class. Such affirmative vote shall be required, notwithstanding the fact that no vote may be required, or that a lesser percentage may be specified, by law or in any agreement with any national securities exchange or otherwise.

B. For the purposes of this Article 8:

(1)  “Affiliate” or “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as in effect on February 31, 1994.

(2) “Beneficial Owner” shall have the meaning ascribed to such term in Rule 12d3 of the General Rules and Regulations under the Exchange Act, as in effect on February 31, 1994.

(3) “Business Combination Transaction” shall mean:

(a) any merger or consolidation of the Corporation or any Subsidiary with (i) an Interested Stockholder or (ii) any other Person (whether or not itself an Interested Stockholder) which is, or after such merger or consolidation would be, an Affiliate or Associate of an Interested Stockholder; or

(b) any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions) to or with, or proposed by or on behalf of, an Interested Stockholder or an Affiliate or Associate of an Interested Stockholder, of any assets of the Corporation or any Subsidiary constituting not less than 5% of the total assets of the Corporation as reported in the consolidated balance sheet of the Corporation as of the end of the most recent quarter with respect to which such balance sheet has been prepared; or

(c)  the issuance or transfer by the Corporation or any Subsidiary (in one transaction or any series of transactions) of any securities of the Corporation or any Subsidiary to, or proposed by or on behalf of an Interested Stockholder in exchange for cash, securities or other property (or a combination thereof) constituting not less than 5% of the total assets of the Corporation as reported in the consolidated balance sheet of the Corporation as of the end of the most recent quarter with respect to which such balance sheet has been prepared; or

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(d) the adoption of any plan or proposal for the liquidation or dissolution of the Corporation, or any spin-off or split-up or any kind of the Corporation or any Subsidiary, proposed by or on behalf of an Interested Stockholder or an Affiliate or Associate of an Interested Stockholder; or

(e) any reclassification of securities (including any reverse stock split), or recapitalization of the Corporation, or any merger or consolidation of the Corporation with any Subsidiary or any other transaction (whether or not with or into or otherwise involving an Interested Stockholder) which has the effect, directly or indirectly, of increasing the percentage of the outstanding shares of (i) any class of equity securities of the Corporation or any Subsidiary or (ii) any class of securities of the Corporation or any Subsidiary convertible into equity securities of the Corporation or any Subsidiary, represented by securities of such class which are directly or indirectly owned by an Interested Stockholder and all of its Affiliates and Associates.

(4) “Continuing Director” means (a) any member of the Board of Directors of the Corporation who (i) is neither the Interested Stockholder involved in the Business Combination Transaction as to which a vote of Continuing Directors is provided hereunder, nor an Affiliate, Associate, employee, agent, or nominee of such Interested Stockholder, or the relative of any of the foregoing, and (ii) was a member of the Board of Directors of the Corporation prior to the time that such Interested Stockholder became an Interested Stockholder, and (b) any successor of a Continuing Director described in clause (a) who is recommended or elected to succeed a Continuing Director by the affirmative vote of a majority of Continuing Directors then on the Board of Directors of the Corporation.

(5) “Fair Market Value” means: (a) in the case of stock, the highest closing sale price during the 30-day period immediately preceding the date in question of a share of such stock on the Composite Tape, on the New York Stock Exchange-Listed Stocks, or, if such stock is not reported on the Composite Tape, on the New York Stock Exchange, or, if such stock is not listed on such Exchange, in the principal United States securities exchange registered under the Exchange act on which such stock is listed, or, if such stock is not listed on any such exchange, the highest closing bid quotation with respect to a share of such stock during the 30-day period preceding the date in question on the National Association of Security Dealers, Inc. Automated Quotations System or any similar interdealer quotation system then in use, or, if no such quotation is available, the fair market value on the date in question of a share of such stock as determined by a majority of the Continuing Directors in good faith; and (b) in the case of property other than cash or stock, the fair market value of such property on the date in question as determined by a majority of the Continuing Directors in good faith.

(6) “Interested Stockholder” shall mean any Person (other than the Corporation or any Subsidiary, any employee benefit plan maintained by the Corporation or any Subsidiary or any trustee or fiduciary with respect to any such plan when acting in such capacity) who or which:

(a)  is or was at any time within the two-year period immediately prior to the date in question, the Beneficial Owner, directly or indirectly, of 10% or more of the voting power of the then outstanding Voting Stock of the Corporation; or

(b) is an Affiliate of the Corporation and at any time within the two-year period immediately prior to the date in question was the Beneficial Owner, directly or indirectly, of 10% or more of the voting power of the outstanding Voting Stock of the Corporation; or

(c)  is an assignee of, or has otherwise succeeded to, any share of Voting Stock of the Corporation of which an interested Stockholder was the Beneficial Owner, directly or indirectly, at any time within the two-year period immediately prior to the date in question, if such assignment or succession shall have occurred in the course of a transaction, or series of transactions, not involving a public offering within the meaning of the Securities Act of 1933, as amended.

For the purpose of determining whether a Person is an Interested Stockholder, the outstanding Voting Stock of the Corporation shall include unissued shares of Voting Stock of the Corporation of which the Interested Stockholder is the Beneficial Owner but shall not include any other shares of Voting Stock of the Corporation which may be issuable pursuant to any agreement, arrangement or understanding, or upon the exercise of any conversion rights, warrants or options, or otherwise, to any person who is not the Interested Stockholder.

(7) A “Person” means any individual, partnership, firm, corporation, association, trust, unincorporated organization or other entity, as well as any syndicate or group deemed to be a person pursuant to Section 14(d) (2) of the Exchange Act.

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(8) “Subsidiary” means any corporation of which the Corporation owns, directly or indirectly, (a) a majority of the outstanding shares of equity securities of such corporation, or (b) shares having a majority of the voting power represented by all of the outstanding Voting Stock of such corporation. For the purpose of determining whether a corporation is a Subsidiary, the outstanding Voting Stock and the shares of equity securities thereof shall include unissued shares of which the corporation is the Beneficial Owner, but, except for purposes of Article 8.B (6), shall not include any other shares which may be issuable pursuant to any agreement, arrangement or understanding, or upon the exercise of conversion rights, warrants or options, or otherwise, to any Person who is not the Corporation.

(9) “Voting Stock” shall mean outstanding shares of capital stock of the relevant corporation entitled to vote generally in the election of directors.

C. The provisions of Article 8.A shall not be applicable to any particular Business Combination Transaction, and such Business Combination Transaction shall require only such affirmative vote of the stockholders, if the condition specified in either of the following paragraphs (1) or (2) are met:

(1) The Business Combination Transaction shall have been approved by the affirmative vote of all of the Continuing Directors, even if the Continuing Directors do not constitute a quorum of the entire Board of Directors.

(2) All of the following conditions shall have been met:

(a)  With respect to each share of each class of outstanding Voting Stock of the Corporation (including Common Stock), the holder thereof shall be entitled to receive on or before the date of the consummation of the Business Combination transaction (the “Consummation Date”), cash and consideration, in the form specified in Article 8.C (2)

(b) hereof, with an aggregate Fair Market Value as of the Consummation Date at least equal to the highest of the following:

(i) the highest per share price (including brokerage commissions, transfer taxes and soliciting dealers’ fees) paid by the Interested Stockholder to which the Business Combination Transaction relate, or by any affiliate or Association of such Interested Stockholder, for any shares of such class of Voting Stock acquired by it (x) within the two-year period immediately prior to the first public announcement of the proposal of the Business Combination Transaction (the “Announcement Date”) or (y) in the transaction in which it became an Interested Stockholder, whichever is higher;

(ii) the Fair Market Value per share of such class of Voting Stock of the Corporation on the Announcement Date; and

(iii) the highest preferential amount per share, if any, to which the holder of the shares of such class of Voting Stock of the Corporation are entitled in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation.

(b) The consideration to be received by a holder of a particular class of outstanding Voting Stock of the Corporation (including Common Stock) as described in Article 8.C (2) (a) hereof shall be in cash or, if the consideration previously paid by or on behalf of the Interested Stockholder in connection with its acquisition of beneficial ownership of shares of such class of Voting Stock consisted, in whole or in part, of consideration other than cash, then in the same form as such consideration. If such payment for shares of any class of Voting Stock of the Corporation has been made in varying forms of consideration, the form of consideration for such class of Voting Stock shall be either cash or the form used to acquire the beneficial ownership of such class of Voting Stock previously acquired by the Interested Stockholder.

(c)  After such Interested Stockholder has become an Interested Stockholder and prior to the Consummation Date: (i) there shall have been no failure to declare and pay at the regular date therefore any full dividends (whether or not cumulative) on the outstanding Preferred Stock of the Corporation, if any, except as approved by the affirmative vote of a majority of the Continuing Directors; (ii) there shall have been (x) no reduction in the annual rate of dividends paid on the Common Stock of the Corporation (except as necessary to reflect any subdivision of the Common Stock), except as approved by the affirmative vote of a majority of the Continuing Directors, and (y) an increase in such annual rate of dividends as necessary to reflect any reclassification (including any reverse stock split), recapitalization, reorganization or any similar transaction which has the effect of reducing the number of outstanding share of the Common Stock, unless the failure to so increase such annual rate is approved by the affirmative vote of a majority of the Continuing Directors, and (iii) such Interested Stockholder shall not have become the Beneficial Owner of any additional shares of Voting Stock of the Corporation except as part of the transaction which results in such Interested Stockholder becoming an Interested Stockholder.

(d) After such Interested Stockholder has become an Interested Stockholder, neither such Interested Stockholder nor any Affiliate or Associate thereof, shall have received the benefit, directly or indirectly except proportionately as shareholder of the Corporation), of any loans advances, guarantees, pledges or other financial assistance or any tax credits or other tax advantages provided by the Corporation.

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(e) A proxy or information statement describing the proposed Business Combination Transaction and complying with the requirements of the Exchange Act and the General Rules and Regulations thereunder (or any subsequent provisions replacing such Act, Rules and Regulations) shall be mailed to the shareholder of the Corporation at least 30 days prior to the Consummation Date (whether or not such Proxy or information statement is required to be mailed pursuant to such Act or subsequent provisions thereof).

D. A majority of the Continuing Directors shall have the power and duty to determine, on the basis of information known to them after reasonable inquiry, all facts necessary to determine compliance with this Article 8, including, without limitation, (1) whether a Person is an Interested Stockholder, (2) the number of shares of Voting Stock of the Corporation beneficially owned by any Person, (3) whether a Person is an Affiliate or Associate of another, (4) whether the requirements of Article 8.C(2) have been met with respect to any Business Combination Transaction, and (5) whether the assets which are the subject of any Business Combination Transaction have, or the consideration to be received for the issuance or transfer of securities by the Corporation or any subsidiary in any Business Combination Transaction constitutes not less than 5% of the total assets of the Corporation as reported in the consolidated balance sheet of the Corporation as of the end of the most recent quarter with respect to which such balance sheet has been prepared. The good faith determination of the majority of the Continuing Directors on such matters shall be conclusive and binding for all the purposes of this Article 8.

E. Nothing contained in this Article shall be construed to relieve members of the Board of Directors or an Interested Stockholder from any fiduciary obligation imposed by law. The fact that any Business Combination Transaction comes with the provision of Article 8.C shall not be construed to impose any fiduciary duty, obligation or responsibility on the Board of Directors or any member thereof, to approve such Business Combination Transaction or recommend its adoption or approval to the shareholders of the Corporation nor shall compliance limit, prohibit or otherwise restrict in any manner the Board of Directors, or any member thereof, with respect to evaluations of or actions and responses taken with respect to such Business Combination Transactions.

Article 9. In the event that the Board of Directors should consist of in excess of one director, the Board of Directors shall be divided into three classes as nearly equal in number as possible. The Initial terms of directors elected in 2017 shall expire as of the annual meeting of shareholders for the years indicated below:

Class I Directors	2018
Class II Directors	2019
Class III Directors	2020

Upon expiration of the initial terms specified for each class of directors their successors shall be elected for a four-year term. If the number of directors is changed, any increase or decrease shall be apportioned among the classes, so as to maintain or attain if possible, the equality of the number of directors in each class, but in no case will decrease in the number of directors shorten the term of any incumbent director. If equality in number is not possible, the increase or decrease shall be apportioned among the classes in such way that the difference in the number of directors in any two classes shall not exceed one.

Any vacancies in the Board of Directors for any reason and any newly created directorships resulting by reason of any increase in the number of directors shall be filled by the Board of Directors, acting by a majority of the remaining directors the in office, although less than a quorum, and any director so chosen shall hold office until the next election of the class for which such directors have been chosen and until their successors are elected and qualified.

A written ballot shall not be required for the election of directors unless the bylaws of the Corporation shall so provide.

Article 10. A quorum of the Board of Directors shall consist of all of the directors.

Article 11. In furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to do the following actions, but the following actions shall be taken only by a two-thirds majority vote of the Board of Directors. :

(a) To adopt, amend or repeal the Bylaws of the Corporation by vote of a majority of the members of the Board of Directors, but any Bylaws adopted by the Board of Directors may be amended by the shareholders of the Corporation.

(b) To distribute to the shareholders of the Corporation out of capital surplus of the Corporation a portion of its assets, in cash or property, subject to the requirements of law, and such distribution is expressly permitted without the vote of the shareholders;

(c) To cause the Corporation to make purchases of its shares, directly or indirectly, to the extent of unreserved and unrestricted earned surplus available therefore, without the vote of the shareholders;

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(d) If at any time the Corporation has more than one class of authorized or outstanding stock, to pay dividends on shares of any class to the holders of shares of any class, without the vote of the shareholders of the class in which the payment is to be made;

(f) To amend these articles of incorporation,

(g) To issue new stock or debt, including the issuance of treasury stock,

(h) To purchase, sell or transfer any substantial part of the Corporation’s assets

(i) To merge or sell the Corporation or acquire another entity,

(j) To dissolve or liquidate the Corporation,

(k) To make a material change in the business of the Corporation,

(l) To make any substantial contact or incur any substantial debt or obligation of the Corporation,

(m) To file bankruptcy, enter into any insolvency proceeding or make any assignment for the benefit of creditors or compromise any debt, and

(n) To take any action which the Board of Directors is required or permitted to take without a meeting by written consent, setting forth the action so taken, signed by all of the directors entitled to vote thereon.

Article 12. In evaluating a Business Combination (as defined in Article 8 above) or a tender or exchange offer and other acquisition proposal, the Board of Directors in determining what is in the best interest of the Corporation, may consider, among others, the following factors

(a) the financial aspects of the offer, the long-term interests of the Corporation’s shareholders, the present and historical market value of the Corporation’s shares and the premiums paid in other relevant transactions, the liquidation value of the Corporation’s assets, the prospects of the Corporation, and (to the extent estimable) its stock on a going concern basis over the subsequent several years;

(b) the prospects for obtaining and methods of achieving a better offer, such as seeking other bids, pursuing negotiating strategies (which may include defensive tactics), and partial or total liquidation;

(c)  the impact, if the offer is partial or two-tier, on the remaining shareholders and on the prospects of the Corporation in the event the offer is successful;

(d) the value and investment attributes of the non-cash consideration if the offer involves consideration other than cash;

(e)  the potential of the offer (if partial or two-tier), including the offeror’s competence, experience, integrity, management, reputation and financial condition;

(f)  legal and regulatory matters, or other considerations that could impede or prevent the transaction’s consummation;

(g)  the effect of the transaction on the Corporation’s (and its subsidiaries’) customers, including policyholders, suppliers and employees; and

(h) local community interests.

Article 13. The affirmative vote of the holders of at least 66% of the voting power of all of the shares of capital stock of the Corporation then entitled to vote generally in the election of directors, voting together as a single class, shall be required to amend, alter, change or repeal, or adopt any provision or provisions inconsistent with Articles 8, 9, 12,or 13 hereof, unless such amendment, alteration, change repeal or adoption of any inconsistent provision or provisions is declared advisable by the Board of Directors by the affirmative vote of (A) all of the entire Board of Directors and (B) all of the Continuing Directors (as defined in Article 8).

Article 14. The Corporation shall indemnify any person (including his estate) made or threatened to be made a party to any suit or proceeding, whether civil or criminal, by reason of the fact that he was a director or officer of the Corporation or served at its request as a director or officer of another Corporation, against judgments, fines, amounts paid in settlement and reasonable expenses, including attorney fees actually and necessarily incurred as a result of such threat, suit or proceeding, or any appeal therein, to the full extent permitted by the General Corporation Law of Colorado. Promptly after receipt by a party to be indemnified under this section of notice of the commencement of any such suit or proceeding, such party will, if a claim in respect thereof is to be made against the Corporation, notify the Corporation of the commencement thereof. This Corporation shall be entitled to participate at its own expense in the defense or to assume the defense of any such suit or proceedings, such defense shall be conducted by counsel chosen by it and reasonably satisfactory to the party to be indemnified and the party to be indemnified shall bear the fees and expenses of any additional counsel retained by him.

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Article 15. The name and mailing address of the incorporator is as follows:

Name	Mailing Address
John E. Lux	1629 K Street, Suite 300
	Washington, DC 20006
Article 16. The name and mailing address of the registered agent is as follows:
Name	Mailing Address
Hart & Hart, LLC	1624 Washington Street
	Denver, CO 80203, United States

Article 17. The mailing address of the corporation’s principal office is:

Mailing Address

American Energy Partners, Inc.

PO Box 443

Allentown, PA 18105

United States

I, the undersigned, being the incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the Colorado Business Corporation Code, do make this certificate, hereby declaring and certifying that this is my act and deed and the facts herein as stated are true, and accordingly have hereunto set my hand this 3rd day of August 2017.

/s/ John E. Lux

John E. Lux

Incorporator

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This Amended and Restated Articles of Incorporation was adopted on the 3rd day of August 2017 by Unanimous Resolutions of the Board of Directors of the Corporation and sufficient vote for approval by Shareholders of the Corporation, to be effective immediately.

The number of votes cast for the amendments by the shareholders was/were sufficient for approval.

Dated August 3, 2017

Signature

/s/ Brad Domitrovitsch

Brad Domitrovitsch, President

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EX1A-2B BYLAWS

Exhibit 2.2

AMERICAN ENERGY PARTNERS, INC.

BYLAWS

BYLAWS

OF

AMERICAN ENERGY PARTNERS, INC.

ARTICLE I
OFFICES

The principal office of the corporation shall be designated time to time by the corporation and may be within or outside of Colorado.

The corporation may have such other offices, either within or outside Colorado, as the board of directors may designate or as the business of the corporation may require from time to time.

The registered office of the corporation required by the General Corporation Law of Colorado to be maintained in Colorado may be, but need not be, identical with the principal office, and the address of the registered office may be changed from time to time by the board of directors.

ARTICLE II

SHAREHOLDERS

Section 1. ANNUAL MEETING. The annual meeting of the shareholders shall be held on a date and at a time fixed by the board of directors of the corporation (or by the president in the absence of action by the board of directors), beginning with the year 2016, for the purpose of electing directors and for the transaction of such other business as may come before the meeting. If the election of directors is not held on the day fixed as provided herein for any annual meeting of the shareholders, or any adjournment thereof, the board of directors shall cause the election to be held at a special meeting of the shareholders as soon thereafter as it may conveniently be held.

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A shareholder may apply to the district court in the county in Colorado where the corporation's principal office is located or, if the corporation has no principal office in Colorado, to the district court of the county in which the corporation's registered office is located to seek an order that a shareholder meeting be held (i) if an annual meeting was not held within six months after the close of the corporation's most recently ended fiscal year or fifteen months after its last annual meeting, whichever is earlier, or (ii) if the shareholder participated in a proper call of or proper demand for a special meeting and notice of the special meeting was not given within thirty days after the date of the call or the date the last of the demands necessary to require calling of the meeting was received by the corporation pursuant to the General Corporation Law of Colorado, or the special meeting was not held in accordance with the notice.

Section 2. SPECIAL MEETINGS. Unless otherwise prescribed by statute, special meetings of the shareholders may be called for any purpose by the president or by the board of directors. The president shall call a special meeting of the shareholders if the corporation receives one or more written demands for the meeting, stating the purpose or purposes for which it is to be held, signed and dated by holders of shares representing at least ten percent of all the votes entitled to be cast on any issue proposed to be considered at the meeting.

Section 3. PLACE OF MEETING. The board of directors may designate any place, either within or outside Colorado, as the place for any annual meeting or any special meeting called by the board of directors. A waiver of notice signed by all shareholders entitled to vote at a meeting may designate any place, either within or outside Colorado, as the place for such meeting. If no designation is made, or if a special meeting is called other than by the board, the place of meeting shall be the principal office of the corporation.

Section 4. NOTICE OF MEETING. Written notice stating the place, date, and hour of the meeting shall be given not less than ten nor more than sixty days before the date of the meeting, except if any other longer period is required by the General Corporation Law of Colorado. The secretary shall be required to give such notice only to shareholders entitled to vote at the meeting except as otherwise required by the General Corporation Law of Colorado.

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Notice of a special meeting shall include a description of the purpose or purposes of the meeting. Notice of an annual meeting need not include a description of the purpose or purposes of the meeting except the purpose or purposes shall be stated with respect to (i) an amendment to the articles of incorporation of the corporation, (ii) a merger or share exchange in which the corporation is a party and, with respect to a share exchange, in which the corporation's shares will be acquired, (iii) a sale, lease, exchange or other disposition (i other than in the usual and regular course of business, of all or substantially all of the property of the corporation or of another entity which this corporation controls, in each case with or without the goodwill, (iv) a dissolution of the corporation, (v) restatement of the articles of incorporation, or (vi) any other purpose for which a statement of purpose is required by the General Corporation Law of Colorado. Notice shall be given personally or by mail, private carrier, electronically transmitted facsimile or other form of wire or wireless communication by or at the direction of the president, the secretary, or the officer or persons calling the meeting, to each shareholder of record entitled to vote at such meeting. If mailed and if in a comprehensible form, such notice shall be deemed to be given and effective when deposited in the United States mail, properly addressed to the shareholder at his address as it appears in the corporation's current record of shareholders, with first class postage prepaid. If notice is given other than by mail, and provided that such notice is in a comprehensible form, the notice is given and to be effective when sent.

If requested by the person or persons lawfully calling such meeting, the secretary shall give notice thereof at corporate expense. No notice need be sent to any shareholder if three successive, notices mailed to the last known address of such shareholder have been returned as undeliverable until such time as another address for such shareholder is made known to the corporation by such shareholder. In order to be entitled to receive notice of any meeting, a shareholder shall advise the corporation in writing of any change in such shareholder's mailing address as shown on the corporation's books and records.

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When a meeting is adjourned to another date, time or place, notice need not be given of the new date, time or place if the new date, time or place of such meeting is announced before adjournment at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business that may have been transacted at the original meeting. If the adjournment is for more than 120 days, or if a new record date is fixed for the adjourned meeting, a new notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the meeting as of the new record date.

A shareholder may waive notice of a meeting before or after the time and date of the meeting by a writing signed by such shareholder. Such waiver shall be delivered to the corporation for filing with the corporate records, but this delivery and filing shall not be conditions to the effectiveness of the waiver. Further, by attending a meeting either in person or by proxy, a shareholder waives objection to lack of notice or defective notice of the meeting unless the shareholder objects at the beginning of the meeting to the holding of the meeting or the transaction of business at the meeting because of lack of notice or defective notice. By attending the meeting, the shareholder also waives any objection to consideration at the meeting of a particular matter not within the purpose or purposes described in the meeting notice unless the shareholder objects to considering the matter when it is presented.

Section 5. FIXING OF RECORD DATE. For the purpose of determining shareholders entitled to (i) notice of or vote at any meeting of shareholders or any adjournment thereof, (ii) receive distributions or share dividends, (iii) demand a special meeting, or (iv) make a determination of shareholders for any other proper purpose, the board of directors may fix a future date as the record date for any such determination of shareholders, such date in any case to be not more than seventy days, and, in case of a meeting of shareholders, not less than ten days, prior to the date on which the particular action requiring such determination of shareholders is to be taken. If no record date is fixed by the directors, the record date shall be the day before the notice of the meeting is given to shareholders, or the date on which the resolution of the board of directors providing for a distribution is adopted, as the case may be. When a determination of shareholders entitled to vote at any meeting of shareholders is made as provided in this section, such determination shall apply to any adjournment thereof unless the board of directors fixes a new record date, which it must do if the meeting is adjourned to a date more than 120 days after the date fixed for the original meeting. Unless otherwise specified when the record date is fixed, the time of day for such determination shall be as of the corporation's close of business on the record date.

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Notwithstanding the above, the record date for determining the shareholders entitled to take action without a meeting or entitled to be given notice of action so taken shall be the date a writing upon which the action is taken is first received by the corporation. The record date for determining shareholders entitled to demand a special meeting shall be the date of the earliest of any of the demands pursuant to which the meeting is called.

Section 6. VOTING LISTS. After a record date is fixed for a shareholders' meeting, the secretary shall make, at the earlier often days before such meeting or two business days after notice of the meeting has been given, a complete list of the shareholders entitled to be given notice of such meeting or any adjournment thereof. The list shall be arranged by voting groups and within each voting group by class or series of shares, shall be in alphabetical order within each class or series, and shall show the address of and the number of shares of each class or series held by each shareholder. For the period beginning the earlier of ten days prior to the meeting or two business days after notice of the meeting is given and continuing through the meeting and any adjournment thereof, this list shall be kept on file at the principal office of the corporation, or at a place (which shall be identified in the notice) in the city where the meeting will be held. Such list shall be available for inspection on written demand by any shareholder (including for the purpose of this Section 6 any holder of voting trust certificates) or his agent or attorney during regular business hours and during the period available for inspection. The original share transfer books shall be prima facie evidence as to who are the shareholders entitled to examine such list or transfer books or to vote at any meeting of shareholders.

Any shareholder, his agent or attorney may copy the list during 'regular business hours and during the period it is available for inspection, provided (i) the shareholder has been a shareholder for at least three months immediately preceding the demand or holds at least five percent of all outstanding shares of any class of shares as of the date of the demand, (ii) the demand is made in good faith and for a purpose reasonably related to the demanding shareholder's interest as a shareholder, (iii) the shareholder describes with reasonable particularity the purpose and the records the shareholder desires to inspect, (iv) the records are directly connected with the described purpose, and (v) the shareholder pays a reasonable charge covering the costs of labor and material for such copies, not to exceed the estimated cost of production and reproduction.

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Section 7. RECOGNITION PROCEDURE FOR BENEFICIAL OWNERS—The board of directors may adopt by resolution a procedure whereby a shareholder of the corporation may certify in writing to the corporation that all or a portion of the shares registered in the name of such shareholder are held for the account of a specified person or persons. The resolution may set forth (i) the types of nominees to which it applies, (ii) the rights or privileges that the corporation will recognize in a beneficial owner, which may include rights and privileges other than voting, (iii) the form of certification and the information to be contained therein, (iv) if the certification is with respect to a record date, the time within which the certification must be received by the corporation, (v) the period for which the nominee's use of the procedure is effective, and (vi) such other provisions with respect to the procedure as the board deems necessary or desirable. Upon receipt by the corporation of a certificate complying with the procedure established by the board of directors, the persons specified in the certification shall be deemed, for the purpose or purposes set forth in the certification, to be the registered holders of the number of shares specified in place of the shareholder making the certification.

Section 8. QUORUM AND MANNER OF ACTING. A majority of the votes entitled to be cast on a matter by a voting group represented in person or by proxy, shall constitute a quorum of that voting group for action on the matter. If less than a majority of such votes are represented at a meeting, a majority of the votes so represented may adjourn the meeting from time to time without further notice, for a period not to exceed 120 days for anyone adjournment. If a quorum is present at such adjourned meeting, any business may be transacted which might have been transacted at the meeting as originally noticed. The shareholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum, unless the meeting is adjourned and a new record date is set for the adjourned meeting.

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If a quorum exists, action on a matter other than the election of directors by a voting group is approved if the votes cast within the voting group favoring the action exceed the votes cast within the voting group opposing the action, unless the vote of a greater number or voting by classes is required by law or the articles of incorporation.

Section 9. PROXIES. At all meetings of shareholders, a shareholder may vote by proxy by signing an appointment form or similar writing, either personally or by his duly authorized attorney-in-fact. A shareholder may also appoint a proxy by transmitting or authorizing the transmission of a facsimile or other electronic transmission providing a written statement of the appointment to the proxy, a proxy solicitor, proxy support service organization, or other person duly authorized by the proxy to receive appointments as agent for the proxy, or to the corporation. The transmitted appointment shall set forth or be transmitted with written evidence from which it can be determined that the shareholder transmitted or authorized transmission of the appointment. The proxy appointment for similar writing shall be filed with the secretary of the corporation before or at the time of the meeting. The appointment of a proxy effective when received by the corporation and is valid for eleven (11) months unless a different period is expressly provided in the appointment form or similar writing.

Any complete copy, including an electronically transmitted facsimile, of an appointment of a proxy may be substituted for or used/in. lieu of the original appointment for any purpose for which the original appointment could be used.

Revocation of a proxy does not affect the right of the corporation to accept the proxy's authority unless (i) the corporation had notice that the appointment was coupled with an interest and notice that such interest is extinguished is received by the secretary or other officer or agent authorized to tabulate votes before the proxy exercises his authority under the appointment, or (ii) other notice of the revocation of the appointment is received by the secretary or other officer or agent authorized to tabulate votes before the proxy exercises his authority under the appointment. Other notice of revocation may in, the discretion of the corporation, be deemed to include the appearance at a shareholders' meeting of the shareholder who granted the proxy and his voting in person on any matter subject to a vote at such meeting.

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The death or incapacity of the shareholder appointing a proxy does not affect the right of the corporation to accept the proxy's authority unless notice of the death or incapacity is received by the secretary or other officer or agent authorized to tabulate votes before the proxy exercises his authority under the appointment.

The corporation shall not be required to recognize an appointment made irrevocable if it has received a writing revoking the appointment signed by the shareholder Including a shareholder who is a successor to the shareholder who granted the proxy) either personally or by his attorney-in-fact, notwithstanding that the revocation may be a breach of an obligation of the shareholder to another person not to revoke the appointment.

Subject to Section 11 and any express limitation on the proxy's authority appearing on the appointment form, the corporation is entitled to accept the proxy's vote or other action as that of the shareholder making the appointment.

Section 10. VOTING OF SHARES. Each outstanding share, regardless of class, shall be entitled to one vote, except in the election of directors, and each fractional share shall be entitled to a corresponding fractional vote on each matter submitted to a vote at a meeting of shareholders, except to the extent that the voting rights of the shares of any class or classes are limited or denied by the articles of incorporation as permitted by the General Corporation Law of Colorado. Cumulative voting shall not be permitted in the election of directors or for any other purpose. Each record holder of shares shall be entitled to vote in the election of directors and shall have as many votes for each of the shares owned by him as there are directors to be elected and for whose election he has the right to vote.

At each election of directors, that number of candidates equaling the number of directors to be elected, having the highest number of votes cast in favor of their election, shall be elected to the board of directors.

Except as otherwise ordered by a court of competent jurisdiction upon a finding that the purpose of this Section would not be violated in the circumstances presented to the court, the shares of the corporation are not entitled to be voted if they are owned, directly or indirectly, by a second corporation, domestic or foreign, and the first corporation owns, directly or indirectly, a majority of the shares entitled to vote for directors of the second corporation except to the extent the second corporation holds the shares in a fiduciary capacity.

9

Redeemable shares are not entitled to be voted after notice of redemption is mailed to the holders and a sum sufficient to redeem the shares has been deposited with a bank, trust company or other financial institution under an irrevocable obligation to pay the holders the redemption price on surrender of the shares.

Section 11. CORPORATIONS ACCEPTANCE OF VOTES. If the name signed on a vote, consent, waiver, proxy appointment, or proxy appointment revocation corresponds to the name of a shareholder, the corporation, if acting in good faith, is entitled to accept the vote, consent, waiver, proxy appointment or proxy appointment revocation and give it effect as the act of the shareholder. If the name signed on a vote, consent, waiver, proxy appointment or proxy appointment revocation does not correspond to the name of a shareholder, the corporation, if acting in good faith, is nevertheless entitled to accept the vote, consent, waiver, proxy appointment or proxy appointment revocation and to give it effect as the act shareholder if:

(i) the shareholder is an entity and the name signed purports to be that of an officer or agent of the entity;

(ii) the name signed purports to be that of an administrator, executor, guardian or conservator representing the shareholder and; if the corporation requests, evidence of fiduciary status acceptable to the corporation has been presented with respect to the vote, consent, waiver, proxy appointment or proxy appointment revocation;

(iii) the name signed purports to be that of a receiver or trustee ill bankruptcy of the shareholder and, if the corporation requests, evidence of this status acceptable to the corporation has been presented with respect to the vote, consent, waiver, proxy appointment or proxy appointment revocation;

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(iv) the name signed purports to be that of a pledgee, beneficial owner or attorney-in-fact of the shareholder and, if the corporation requests, evidence acceptable to the corporation of the signatory's authority to sign for the shareholder has been presented with respect to the vote, consent, waiver, proxy appointment or proxy' appointment revocation;

(v) two or more persons are the shareholder as co-tenants or fiduciaries and the name signed purports to be the name of at least one of the co-tenants or fiduciaries, and the person signing appears to be acting on behalf of all the co-tenants or fiduciaries; or

(vi) the acceptance of the vote, consent, waiver, proxy appointment or proxy appointment revocation is otherwise proper under rules established by the corporation that are not inconsistent with this Section 11.

The corporation is entitled to reject a vote, consent, waiver, proxy appointment or proxy appointment revocation if the secretary or other officer or agent authorized to tabulate votes, acting in good faith, has reasonable basis for doubt about the validity of the signature on it or about the signatory's authority to sign for the shareholder.

Neither the corporation nor its officers nor any agent who accepts or rejects a vote, consent, waiver, proxy appointment or proxy appointment revocation in good faith and in accordance with the standards of this Section is liable in damages for the consequences of the acceptance or rejection.

Section 12. INFORMAL ACTION BY SHAREHOLDERS. Any action required or permitted to be taken at a meeting of the shareholders may be taken without a meeting if a written consent (or counterparts thereof) that sets forth the action so taken is signed by shareholders holding at least that proportion of the voting power necessary to approve such action and received by the corporation. Such consent shall have the same force and effect as a vote of the shareholders and may be stated as such in any document. Action taken under this Section 12 is effective as of the date the last writing necessary to effect the action is received by the corporation, unless an of the writings specify a different effective date, in which case such specified date shall be the effective date for such action. The record date for determining shareholders entitled to take action without a meeting is the date the corporation first receives a writing upon which the action is taken.

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Any shareholder who has signed a writing describing and consenting to action taken pursuant to this Section 12 may revoke such consent by a writing signed by the shareholder describing the action and stating that the shareholder's prior consent thereto is revoked, if such writing is received by the corporation before the effectiveness of the action.

Section 13. MEETINGS BY TELECOMMUNICATION. Any or all of the shareholders may participate in an annual or special shareholders' meeting by, or the meeting may be conducted through the use of, any means of communication by which all persons participating in the meeting may hear each other during the meeting. A shareholder participating in a meeting by this means is deemed to be present in person at the meeting.

ARTICLE III

BOARD OF DIRECTORS

Section 1. GENERAL POWERS. All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation shall be managed under the direction of, its board of directors, except as otherwise provided in the General Corporation Law of Colorado or the articles of incorporation.

Section 2. NUMBER, QUALIFICATIONS AND TENURE. The number of directors of the corporation maybe fixed from time to time by the board of directors, within a range of no less than one or more than fifteen, but no decrease in the number of directors shall have the effect of shortening the term of any incumbent director. A director shall be a natural person who is eighteen years of age or older. A director need not be a resident of Colorado or a shareholder of the corporation.

Directors shall be elected at each annual meeting of shareholders.

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Each director shall hold office until the next annual meeting of shareholders following his election and thereafter until his successor shall have been elected and qualified. Directors shall be removed in the manner provided by the General Corporation Law of Colorado. Any director may be removed by the shareholders of the voting group that elected the director, with cause, at a meeting called for that purpose. The notice of the meeting shall state that the purpose or one of the purposes of the meeting is removal of the director. A director may be removed only if the number of votes cast in favor of removal exceeds the number of votes cast against removal.

Section 3. VACANCIES. Any director may resign at any time by giving written notice to the secretary. Such resignation shall take effect at the time the notice is received by the secretary unless the notice specifies a later effective date. Unless otherwise specified in the notice of resignation, the corporation's acceptance of such resignation shall not be necessary to make it effective. Any vacancy on the board of directors may be filled by the affirmative vote of a majority of the shareholders at a special meeting called for that purpose or by the board of directors. If the directors remaining in office constitute fewer than a quorum of the board, the directors may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office. If elected by the directors, the director shall hold office until the next annual shareholders' meeting at which directors are elected. If elected by the shareholders, the director shall hold office for the unexpired term of his predecessor in office; except that, if the director's predecessor was elected by the directors to fill a vacancy, the director elected by the shareholders shall hold office for the unexpired term of the last predecessor elected by the shareholders.

Section 4. REGULAR MEETINGS. A regular meeting of the board of directors shall be held without notice immediately after and at the same place as the annual meeting of shareholders. The board of directors may provide by resolution the time and place, either within or outside Colorado, for the holding of additional regular meetings without other notice.

Section 5. SPECIAL MEETINGS. Special meetings of the board of directors may be called by or at the request of the president or any one of the directors. The person or persons authorized to call special meetings of the board of directors may fix any place, either within or outside Colorado, as the place for holding any special meeting of the board of directors called by them.

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Section 6. NOTICE. Notice of the date, time and place of any special meeting shall be given to each director at least two days prior to the meeting by written notice either personally delivered or mailed to each director at his business address, or by notice transmitted by private courier, electronically transmitted facsimile or other form of wire or wireless communication. If mailed, such notice shall be deemed to be given and to be effective when deposited in the United States mail, properly addressed, with first class postage prepaid. If notice is given by electronically transmitted facsimile or other similar form of wire or wireless communication, such notice shall be deemed to be given and to be effective when sent. If a director has designated in writing one or more reasonable addresses or facsimile numbers for delivery of notice to him, notice sent by mail, electronically transmitted facsimile or other form of wire or wireless communication shall not be deemed to have been given or to be effective unless sent to such addresses or facsimile numbers, as the case may be.

A director may waive notice of a meeting before or after the time and date of the meeting by a writing signed by such director. Such waiver shall be delivered to the secretary for filing with the corporate records, but such delivery and filing shall not be conditions to the effectiveness of the waiver. Further, a director's attendance at or participation in a meeting waives any required notice to him of the meeting unless at the beginning of the meeting, or promptly upon his later arrival, the director objects to holding the meeting or transacting business at the meeting because of lack of notice or defective notice and does not thereafter vote for or assent to action taken at the meeting. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the board of directors need be specified in the notice or waiver of notice of such meeting.

Section 7. QUORUM. A majority of the number of directors fixed by the board of directors pursuant to Article III, Section 2 or, if no number is fixed, a majority of the number in office immediately before the meeting begins, shall constitute a quorum for the transaction of business at any meeting of the board of directors.

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Section 8. MANNER OF ACTING. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors.

Section 9. COMPENSATION. By resolution of the board of directors, any director may be paid anyone or more of the following: his expenses, if any, of attendance at meetings, a fixed sum for attendance at each meeting, a stated salary as director, or such other compensation as the corporation and the director may reasonably agree upon. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor.

Section 10. PRESUMPTION OF ASSENT. A director of the corporation who is present at a meeting of the board of directors or committee of the board at which action on any corporate matter taken shall be presumed to have assented to all action taken at the meeting unless (i) the director objects at the beginning of the meeting, or promptly upon his arrival, to the holding of the meeting or the transaction of business at the meeting and does not thereafter vote for or assent to any action taken at the meeting, (ii) the director contemporaneously requests that his dissent or abstention as to any specific action taken be entered in the minutes of the meeting, (iii) the director causes written notice of his dissent or abstention as to any specific action to be received by the presiding officer of the meeting before its adjournment or by the secretary promptly after the adjournment of the meeting. A director may dissent to a specific action at a meeting, while assenting to others. The right to dissent to a specific action taken at a meeting of the board of directors or a committee of the board shall not be available to a director who voted in favor of such action.

Section 11. COMMITTEES. By resolution adopted by a majority of all the directors in office when the action is taken, the board of directors may designate from among its members an executive committee and one or more other committees, and appoint one or more members of the board of directors to serve on them. To the extent provided in the resolution.

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Sections 4, 5, 6, 7, 8 or 12 of Article III, which govern meetings, notice, waiver of notice, quorum, voting requirements and action without a meeting of the board of directors, shall apply to committees and their members appointed under this Section 11.

Neither the designation of any such committee, the delegation of authority to such committee, nor any action by such committee pursuant to its authority shall alone constitute compliance by any member of the board of directors or a member of the committee in question with his responsibility to conform to the standard of care set forth in Article III, Section 14 of these bylaws.

Section 12. INFORMAL ACTION BY DIRECTORS. Any action required or permitted to be taken at a meeting of the directors or any committee designated by the board of directors may be taken without a meeting if a written consent (or counterparts thereof) that sets forth the action so taken is signed by all of the directors entitled to vote with respect to the action taken. Such consent shall have the same force and effect as a unanimous vote of the directors or committee members and may be stated as such in any document. Unless the consent specifies a different effective time or date, action taken under this Section 12 is effective at the time or date the last director signs a writing describing the action taken, unless, before such time, any director has revoked his consent by a writing signed by the director and received by the president or the secretary of the corporation.

Section 13. TELEPHONIC MEETINGS. The board of directors may permit any director (or any member of a committee designated by the board) to participate in a regular or special meeting of the board of directors or a committee thereof through the use of any means of communication by which all directors participating in the meeting can hear each other during the meeting. A director participating in a meeting in this manner is deemed to be present in person at the meeting.

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Section 14. STANDARD OF CARE. A director shall perform his duties as a director, including without limitation his duties as a member of any committee of the board, in good faith, in a manner he reasonably believes to be in the best interests of the corporation, and with the care an ordinarily prudent person in a like position would exercise under similar circumstances. In performing his duties, a director shall be entitled to rely on information, opinions, reports or statements, including financial statements and other financial data, in each case prepared or presented by the persons herein designated. However, he shall not be considered to be acting in good faith if he has knowledge concerning the matter in question that would cause such reliance to be unwarranted. A director shall not be liable to the corporation or its shareholders for any action he takes or omits to take as a director if, in connection with such action or omission, he performs his duties in compliance with this Section 14.

The designated persons on whom a director is entitled to rely are (i) one or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented, (ii) legal counsel, public accountant, or other person as to matters which the director reasonably believes to be within such person's professional or expert competence, or (iii) a committee designated by the board of directors may be taken without a meeting if a written consent (or counterparts thereof) that sets forth the action so taken is signed by all of the directors entitled to vote with respect to the action taken. Such consent shall have the same force and effect as a unanimous vote of the directors or committee members and may be stated as such in any document. Unless the consent specifies a different effective time or date, action taken under this Section 12 is effective at the time or date the last director signs a writing describing the action taken, unless, before such time, any director has revoked his consent by a writing signed by the director and received by the president or the secretary of the corporation.

The designated persons on whom a director is entitled to rely are (i) one or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented, (ii) legal counsel, public accountant, or other person as to matters which the director reasonably believes to be within such person's professional or expert competence, or (iii) a committee of the board of directors on which the director desires to serve if the director reasonably believes the committee merits confidence.

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ARTICLE IV

OFFICERS AND AGENTS

Section 1. GENERAL. The officers of the corporation chief executive officer and/or president, a secretary and a treasurer and may also include one or more vice presidents, each officer shall be appointed by the board of directors and natural person eighteen years of age or older. One person more than one office. The board of directors or an officer or authorized by the board may appoint such other officers, officers, committees and agents, including a chairman of assistant secretaries and assistant treasurers, as they may consider necessary. Except as expressly prescribed by these bylaws, of directors or the officer or officers authorized by the board from time to time determine the procedure for the officers, their authority and duties and their compensation, that the board of directors may change the authority, duties compensation of any officer who is not appointed by the board.

Section 2. APPOINTMENT AND TERM OF OFFICE. The officers of the corporation to be appointed by the board of directors shall be appointed at each annual meeting of the board held after each annual meeting of the shareholders. If the appointment of officers is not made at such meeting or if an officer or officers are to be appointed by another officer or officers of the corporation, such appointments shall be made as determined by the board of directors or the appointing person or persons. Each officer shall hold office until the first of the following occurs: his successor shall have been duly appointed and qualified, his death, his resignation, or his removal in the manner provided in Section 3.

Section 3. RESIGNATION AND REMOVAL. An officer may resign at any time by giving written notice of resignation to the president, secretary or other person who appoints such officer. The resignation is effective when the notice is received by the corporation unless the notice specifies a later effective date.

Any officer or agent may be removed at any time with or without cause by the board of directors or an officer or officers authorized by the board. Such removal does not affect the contract rights, if any, of the corporation or of the person so removed. The appointment of an officer or agent shall not in itself create contract rights.

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Section 4. VACANCIES. A vacancy in any office, however occurring, may be filled by the board of directors, or by the officer or officers authorized by the board, for the unexpired portion of the officer's term. If an officer resigns and his resignation is made effective at a later date, the board of directors, or officer or officers authorized by the board, may permit the officer to remain in office until the effective date and may fill the pending vacancy before the effective date if the board of directors or officer or officers authorized by the board provide that the successor shall not take office until the effective date. In the alternative, the board of directors, or officer or officers authorized by the board of directors, may remove the officer at any time before the effective date and may fill the resulting vacancy.

Section 5. PRESIDENT. The president shall preside at all meetings of shareholders and all meetings of the board of directors unless the board of directors has appointed a chairman, vice chairman, or other officer of the board and has authorized such person to preside at meetings of the board of directors. Subject to the direction and supervision of the board of directors, the president shall be the chief executive officer of the corporation, and shall have general and active control of its affairs and business and general supervision of its officers, agents and employees. Unless otherwise directed by the board of directors, the president shall attend in person or by substitute appointed by him, or shall execute on behalf of the corporation written instruments appointing a proxy or proxies to represent the corporation, at all meetings of the shareholders of any other corporation in which the corporation holds any shares. On behalf of the corporation, the president may in person or by substitute or by proxy execute written waivers of notice and consents with respect to any such meetings. At all such meetings and otherwise, the president, in person or by substitute or proxy, may vote the shares held by the corporation, execute written consents and other instruments with respect to such shares, and exercise any and all rights and powers incident to the ownership of said shares, subject to the instructions, if any, of the board of directors. The president shall have custody of the treasurer's bond, if any. The president shall have such additional authority and duties as are appropriate and customary for the office of president and chief executive officer, except as the same may be expanded or limited by the board of directors from time to time.

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Section 6. VICE PRESIDENTS. The vice presidents shall assist the president and shall perform such duties as may be assigned to them by the president or by the board of directors. In the absence of the president, the vice president, if any (or, if more than one, the vice presidents in the order designated by the board of directors, or if the board makes no such designation, then the vice president designated by the president, or if neither the board nor the president makes any such designation, the senior vice president as determined by first election to that office), shall have the powers and perform the duties of the president.

Section 7. SECRETARY. The secretary shall (i) prepare and maintain as permanent records the minutes of the proceedings of the shareholders and the board of directors, a record of all actions taken by the shareholders or board of directors without a meeting, a record of all actions taken by a committee of the board of directors in place of the board of directors on behalf of the corporation, and a record of all waivers of notice of meetings of shareholders and of the board of directors or any committee thereof, (ii) see that all notices are duly given in accordance with the provisions of these bylaws and as required by law, (iii) serve as custodian of the corporate records and of the seal of the corporation and affix the seal to all documents when authorized by the board of directors, (iv) keep at the corporation's registered office or principal place of business a record containing the names and addresses of all shareholders in a form that permits preparation of a list of shareholders arranged by voting group and by class or series of shares within each voting group, that is alphabetical within each class or series and that shows the address of, and the number of shares of each class or series held by, each shareholder, unless such a record shall be kept at the office of the corporation's transfer agent or registrar, (v) maintain at the corporation's principal office the originals or copies of the corporation's articles Of incorporation, bylaws, minutes of all shareholders' meetings and records of all action taken by shareholders without a meeting for the past three years, all written communications within the past three years to shareholders as a group or to the holders of any class or series of shares as a group, a list of the names and business addresses of the current directors and officers, a copy of the corporation's most recent corporate report filed with the Secretary of State, and financial statements showing in reasonable detail the corporation's assets and liabilities and results of operations for the last three years, (vi) have general charge of the stock transfer books of the corporation, unless the corporation has a transfer agent, (vii) authenticate records of the corporation, and (viii) in general, perform all duties incident to the office of secretary and such other duties as from time to time may be assigned to him by the president or by the board of directors. Assistant secretaries, if any, shall have the same duties and powers, subject to supervision by the secretary. The directors and/or shareholders may however respectively designate a person other than the secretary or assistant secretary to keep the minutes of their respective meetings.

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Any books, records, or minutes of the corporation may be in written form or in any form capable of being converted into written form within a reasonable time:

Section 8. TREASURER. The treasurer shall be the principal financial officer of the corporation, shall have the care and custody of all funds, securities, evidences of indebtedness and other personal property of the corporation and shall deposit the same in accordance with the instructions of the board of directors. Subject to the limits imposed by the board of directors, he shall receive and give receipts and acquaintances for money paid in on account of the corporation, and shall payout of the corporation's funds on hand all bills, payrolls and other just debts of the corporation of whatever nature upon maturity. He shall perform all other duties incident to the office of the treasurer and, upon request of the board, shall make such reports to it as may be required at any time. He shall, if required by the board, give the corporation a bond in such sums and with such 'sureties as shall be satisfactory to the board, conditioned upon the faithful performance of his duties and for the restoration to the corporation of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the corporation. He shall have such other powers and perform such other duties as may from time to time be prescribed by the board of directors or the president. The assistant treasurers, if any, shall have the same powers and duties, subject to the supervision of the treasurer.

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The treasure shall also be the principal accounting officer of the corporation. He shall prescribe and maintain the methods and systems of accounting to be followed, keep complete books and records of account as required by the General Corporation Law of Colorado, prepare and file all local, state and federal tax: returns, prescribe and maintain an adequate system of internal audit and prepare and furnish to the president and the board of directors statements of account showing the financial position of the corporation and the results of its operations.

ARTICLE V
SHARES

Section 1. CERTIFICATES. The board of directors shall be authorized to issue any of its classes of shares with or without certificates. The fact that the shares are not represented by certificates shall have no effect on the rights and obligations of shareholders. If the shares are represented by certificates, such shares shall be represented by consecutively numbered certificates signed, either manually or by facsimile, in the name of the corporation by the president. In case any officer who has signed or whose facsimile signature has been placed upon such certificate shall have ceased to be such officer before such certificate is issued, such certificate may nonetheless be issued by the corporation with the same effect as if he were such officer at the date of its issue. All certificates shall be consecutively numbered, and the names of the owners, the number of shares, and the date of issue shall be entered on the books of the corporation. Each certificate representing shares shall state upon its face:

(i) That the corporation is organized under the laws of Colorado; (ii) The name of the person to whom issued;

(iii)       The number and class of the shares and the designation of the series, if any, that the certificate represents;

(iv)       The par value, if any, of each share represented by the certificate;

(v)       Any restrictions imposed by the corporation upon the transfer of the shares represented by the certificate.

If shares are not represented by certificates, within a reasonable time following the issue or transfer of such shares, the corporation shall send theshareholder a complete written statement of all of the information required to be provided to holders of uncertificated shares by the General Corporation Law of Colorado.

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Section 2. CONSIDERATION FOR SHARES. Certificated or uncertificated shares shall not be issued until the shares represented thereby are fully paid. The board of directors may authorize the issuance of shares for consideration consisting of any tangible or intangible property or benefit to the corporation, including cash, promissory notes, services performed or other securities of the corporation. Future services shall not constitute payment or partial payment for shares of the corporation. The promissory note of a subscriber or an affiliate of a subscriber shall not constitute payment or partial payment for shares of the corporation unless the note is negotiable and is secured by collateral, other than the shares being purchased, having a fair market value at least equal to the principal amount of the note. For purposes of this Section 2, "promissory note" means a negotiable instrument on which there is an obligation to pay independent of collateral and does not include a non-recourse note.

Section 3. LOST CERTIFICATES. In case of the alleged loss, destruction or mutilation of a certificate of stock, the board of directors may direct the issuance of a new certificate in lieu thereof upon such terms and conditions in conformity with law as the board may prescribe. The board of directors may in its discretion require an affidavit of lost certificate and/or a bond in such form and amount and with such surety as it may determine before issuing a new certificate.

Section 4. TRANSFER OF SHARES. Upon surrender to the corporation or to a transfer agent of the corporation of a certificate of stock duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, and receipt of such documentary stamps as may be required by law and evidence of compliance with all applicable securities laws and other restrictions, the corporation shall issue a new certificate to the person entitled thereto, and cancel the old certificate. Every such transfer of stock shall be entered on the stock books of the corporation that shall be kept at its principal office or by the person and at the place designated by the board of directors.

Except as otherwise expressly provided in Article II, Sections 7 and 11, and except for the assertion of dissenters' rights to the extent provided in the Colorado General Corporation Law, the corporation shall be entitled to treat the registered holder of any shares of the corporation as the owner thereof for all purposes, and the corporation shall not be bound to recognize any equitable or other claim to, or interest in, such shares or rights deriving from such shares on the part of any person other than the registered holder, including without limitation any purchaser, assignee or transferee of such shares or rights deriving from such shares, unless and until such other person becomes the registered holder of such shares, whether or not the corporation shall have either actual or constructive notice of the claimed interest of such other person.

Section 5. TRANSFER AGENT, REGISTRARS AND PAYING AGENTS. The board may at its discretion appoint one or more transfer agents, registrars and agents for making payment upon any class of stock, bond, debenture or other security of the corporation. Such agents and registrars may be located either within or outside Colorado. They shall have such rights and duties and shall be entitled to such compensation as may be agreed.

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ARTICLE VI

INDEMNIFICATION OF CERTAIN PERSONS

Section 1. INDEMNIFICATION. For purposes of Article VI, a "Proper Person" means any person (including the estate or personal representative of a director) who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, and whether formal or informal, by reason of the fact that he is or was a director, officer, employee, fiduciary or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, fiduciary or agent of any foreign or domestic profit or nonprofit corporation or of any partnership, joint venture, trust, profit or nonprofit unincorporated association, limited liability company, or other enterprise or employee benefit plan. The corporation shall indemnify any Proper Person against reasonably incurred expenses (including attorneys' fees), judgments, penalties, fines (including any excise tax assessed with respect to an employee benefit plan) and amounts paid in settlement reasonably incurred by him in connection with such action, suit or proceeding if it is determined by the groups set forth in Section 4 of this Article that he conducted himself in good faith and that he reasonably believed (i) in the case of conduct in his official capacity with the corporation, that his conduct was in the corporation's best interests, or (ii) in all other cases (except criminal cases), that his conduct was at least not opposed to the corporation's best interests, or (iii) in the case of any criminal proceeding, that he had no reasonable cause to believe his conduct was unlawful. Official capacity means, when used with respect to a director, the office of director and, when used with respect to any other Proper Person, the office in a corporation held by the officer or the employment, fiduciary or agency relationship undertaken by the employee, fiduciary, or agent on behalf of the corporation. Official capacity does not include service for any other domestic or foreign corporation or other person or employee benefit plan.

A director's conduct with respect to an employee benefit plan for a purpose the director reasonably believed to be in the interests of the participants in or beneficiaries of the plan is conduct that satisfies the requirement in (ii) of this Section 1. A director's conduct with respect to an employee benefit plan for a purpose that the director did not reasonably believe to be in the interests of the participants in or beneficiaries of the plan shall be deemed not to satisfy the requirement of this section that he conduct himself in good faith.

No indemnification shall be made under this Article VI to a Proper Person with respect to any claim, issue or matter in connection with a proceeding by or in the right of a corporation in which the Proper Person was adjudged liable to the corporation or in connection with any proceeding charging that the Proper Person derived an improper personal benefit, whether or not involving action in an official capacity, in which he was adjudged liable on the basis that he derived an improper personal benefit. Further, indemnification under this section in connection with a proceeding brought by or in the right of the corporation shall be limited to reasonable expenses, including attorneys' fees, incurred in connection with the proceeding.

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Section 2. RIGHT TO INDEMNIFICATION. The corporation shall indemnify any Proper Person who was wholly successful, on the merits or otherwise, in defense of any action, suit, or proceeding as to which he was entitled to indemnification under Section 1 of this Article VI against expenses (including attorneys' fees) reasonably incurred by him in connection with the proceeding without the necessity of any action by the corporation other than the determination in good faith that the defense has been wholly successful.

Section 3. EFFECT OF TERMINATION OF ACTION. The termination of any action, suit or proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent shall not of itself create a presumption that the person seeking indemnification did not meet the standards of conduct described in Section 1 of this Article VI. Entry of a judgment by consent as part of a settlement shall not be deemed an adjudication of liability, as described in Section 2 of this Article VI.

Section 4. GROUPS AUTHORIZED TO MAKE INDEMNIFICAATION DETERMINATION. Except where there is a right to indemnification as set forth in Sections 1 or 2 of this Article or where indemnification is ordered by a court in Section 5, any indemnification shall be made by the corporation only as determined in the specific case by a proper group that indemnification of the Proper Person is permissible under the circumstances because he has met the applicable standards of conduct set forth in Section 1 of this Article. This determination shall be made by the board of directors by a majority vote of those present at a meeting at which a quorum is present, which quorum shall consist of directors not parties to the proceeding ("Quorum"). If a Quorum cannot be obtained, the determination shall be made by a majority vote of a committee of the board of directors designated by the board, which committee shall consist of two or more directors not parties to the proceeding, except that directors who are parties to the proceeding may participate in the designation of directors for the committee. If a Quorum of the board of directors cannot be obtained and the committee cannot be established, or even if a Quorum is obtained or the committee is designated and a majority of the directors constituting such Quorum or committee so directs, the determination shall be made by (i) independent legal counsel selected by a vote of the board of directors or the committee in the manner specified in this Section 4 or, if a Quorum of the full board of directors cannot be obtained and a committee cannot be established, by independent legal counsel selected by a majority vote of the full board (including directors who are parties to the action) or (ii) a vote of the shareholders. Authorization of indemnification and advance of expenses shall be made in the same manner as the determination that indemnification or advance of expenses is permissible except that, if the determination that indemnification or advance of expenses is permissible is made by independent legal counsel, authorization of indemnification and advance of expenses shall be made by the body that selected such counsel.

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Section 5. COURT-ORDERED INDEMNIFICATION. Any Proper Person may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction for mandatory indemnification under Section 2 of this Article, including indemnification for reasonable expenses incurred to obtain court-ordered indemnification. If a court determines that the Proper Person is entitled to indemnification under Section 2 of this Article, the court shall order indemnification, including the Proper Person's reasonable expenses incurred to obtain court-ordered indemnification. If the court determines that such Proper Person is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not he met the standards of conduct set forth in Section 1 of this Article or was adjudged liable in the proceeding, the court may order such indemnification as the court deems proper except that if the Proper Person has been adjudged liable, indemnification shall be limited to reasonable expenses incurred in connection with the proceeding and reasonable expenses incurred to obtain court-ordered indemnification.

Section 6. ADVANCE OF EXPENSES. Reasonable expenses (including attorneys' fees) incurred in defending an action, suit or proceeding as described in Section 1 may be paid by the corporation to any Proper Person in advance of the final disposition of such action, suit or proceeding upon receipt of (D a written affirmation of such Proper Person's good faith belief that he has met the standards of conduct prescribed by Section 1 of this Article VI, (ii) a written undertaking, executed personally or on the Proper Person's behalf, to repay such advances if it is ultimately determined that he did not meet the prescribed standards of conduct (the undertaking shall be an unlimited general obligation of the Proper Person but need not be secured and may be accepted without reference to financial ability to make repayment), and (iii) a determination is made by the proper group (as described in Section 4 of this Article VI) that the facts as then known to the group would not preclude indemnification. Determination and authorization of payments shall be made in the same manner specified in Section 4 of this Article VI.

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Section 7. ADDITIONAL INDEMNIFICATION TO CERTAIN PERSONS OTHER THAN DIRECTORS. In addition to the indemnification provided to officers, employees, fiduciaries or agents because of their status as Proper Persons under this Article, the corporation may also indemnify and advance expenses to them if they are not directors of the corporation to a greater extent than is provided in these bylaws, if not inconsistent with public policy, and if provided for by general or specific action of its board of directors or shareholders or by contract.

Section 8. WITNESS EXPENSES. The sections of this Article VI do not limit the corporation's authority to payer reimburse expenses incurred by a director in connection with an appearance as a witness in a proceeding at a time when he has not been made or named as a defendant or respondent in the proceeding.

Section 9. REPORT TO SHAREHOLDERS. Any indemnification of or advance of expenses to a director in accordance with this Article VI, if arising out of a proceeding by or on behalf of the corporation, shall be reported in writing to the shareholders with or before the notice of the next shareholders' meeting. If the next shareholder action is taken without a meeting at the instigation of the board of directors, such notice shall be given to the shareholders at or before the time the first shareholder signs a writing consenting to such action.

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ARTICLE VII
INSURANCE

Section 1. PROVISION OF INSURANCE. By action of the board of directors, notwithstanding any interest of the directors in the action, the corporation may purchase and maintain insurance, in such scope and amounts as the board of directors deems appropriate, on behalf of any person who is or was a director, officer, employee, fiduciary or agent of the corporation, or who, while a director, officer, employee, fiduciary or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, fiduciary or agent of any other foreign or domestic profit or nonprofit corporation or of any partnership, joint venture, trust, profit or non-profit unincorporated association, limited liability company, other enterprise or employee benefit plan, against any liability asserted against, or incurred by, him in that capacity or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liability under the provisions of Article VI or applicable law. Any such insurance may be procured from any insurance company designated by the board of directors of the corporation, whether such insurance company is formed under the laws of Colorado or any other jurisdiction of the United States or elsewhere, including any insurance company in which the corporation has an equity interest or any other interest, through share ownership or otherwise.

ARTICLE VIII

MISCELLANEOUS

Section 1. SEAL. The board of directors may adopt a corporate seal, which shall contain the name of the corporation and the words, "Seal, Colorado."

Section 2. FISCAL YEAR. The fiscal year of the corporation shall be as established by the board of directors.

Section 3. AMENDMENTS. The board of directors shall have power, to the maximum extent permitted by the Colorado General Corporation Law, to make, amend and repeal the bylaws of the corporation at any regular or special meeting of the board unless the shareholders, in making, amending or repealing a particular bylaw, expressly provide that the directors may not amend or repeal such bylaw. The shareholders also shall have the power to make, amend or repeal the bylaws of the corporation at any annual meeting or at any special meeting called for that purpose.

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Section 4. RECEIPT OF NOTICES BY THE CORPORATION. Notices, shareholder writings consenting to action, and other documents or writings shall be deemed to have been received by the corporation when they are actually received: (1) at the registered office of the corporation in Colorado; (2) at the principal office of the corporation (as that office is designated in the most recent document filed by the corporation with the secretary of state for Colorado designating a principal office) addressed to the attention of the secretary of the corporation; (3) by the secretary of the corporation wherever the secretary may be found; or (4) by any other person authorized from time to time by the board of directors or the president to receive such writings, wherever such person is found.

Section 5. GENDER. The masculine gender is used in these bylaws as a matter of convenience only and shall be interpreted to include the feminine and neuter genders as the circumstances indicate.

Section 6. CONFLICTS. In the event of any irreconcilable conflict between these bylaws and either the corporation's articles of incorporation or applicable law, the latter shall control.

Section 7. DEFINITIONS. Except as otherwise specifically provided in these bylaws, all terms used in these bylaws shall have the same definition as in the General Corporation Law of Colorado.

Commonwealth of PA

County of Lehigh

	COMMONWEALTH OF PENNSYLVANIA
Sworn and subscribed before me	NOTORIAL SEAL
this 7th day July of 2017	Kaitlin Kulp, Notary Public
	South Whitehail Twp., Lehigh County
/s/ Kaitlin Kulp	My Commission Expires Oct. 10, 2020
	MEMBER, PENNSYLVANIA ASSOCIATION OF NOTARIES

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EX1A-6 MAT CTRCT

Exhibit 6.1

AMERICAN ENERGY PARTNERS, INC.

EMPLOYMENT AGREEMENT

Brad Domitrovitsch — President

THIS EMPLOYMENT AGREEMENT (this "Agreement"), effective as of the Effective Date (as defined below), is entered into by and between American Energy Partners, Inc., a Colorado corporation (the "Company"), and Brad Domitrovitsch (the "Executive").

WHEREAS, the Company desires to employ the Executive and to enter into an agreement embodying the terms of such employment; and

WHEREAS, the Executive desires to accept employment with the Company, subject to the terms and conditions of this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1.       Employment Period. Subject to the provisions for earlier termination hereinafter provided, the Executive's employment hereunder shall be for a term (the "Employment Period") commencing on the Effective Date and ending on the fifth anniversary of the Effective Date (the "Initial Termination Date"); provided, however, that this Agreement shall be automatically extended for one additional year on the Initial Termination Date and on each subsequent anniversary of the Initial Termination Date, unless either the Executive or the Company elects not to so extend the term of the Agreement by notifying the other party, in writing, of such election not less than sixty (60) days prior to the last day of the term as then in effect. For purposes of this Agreement, "Effective Date" shall mean the date written below.

2.       Terms of Employment.

(a) Position and Duties.

(i) During the Employment Period, the Executive shall serve as Chairman and President of the Company and shall perform such employment duties as are usual and customary for such positions. At the Company's request, the Executive shall serve the Company and/or its subsidiaries and affiliates in other offices and capacities in addition to the foregoing. In the event that the Executive, during the Employment Period, serves in any one or more of such additional capacities, the Executive's compensation shall not be increased beyond that specified in Section 2(b) of this Agreement. In addition, in the event the Executive's service in one or more of such additional capacities is terminated, the Executive's compensation, as specified in Section 2(b) of this Agreement, shall not be diminished or reduced in any manner as a result of such termination for so long as the Executive otherwise remains employed under the terms of this Agreement.

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(ii) During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote appropriate attention and time during normal business hours to the business and affairs of the Company. During the Employment Period it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) fulfill limited teaching, speaking and writing engagements or (C) manage his personal investments, so long as such activities do not significantly interfere with the performance of the Executive's responsibilities as an employee of the Company in accordance with this Agreement and (D) undertake other business responsibilities. It is expressly understood and agreed that to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive's responsibilities to Company; provided that no such activity that violates any written non-competition agreement between the parties shall be permitted.

(b) Compensation.

(i)  Base Salary. During the Employment Period, the Executive shall receive a base salary (the "Base Salary") as determined by the Board of Directors from time to time with due regard for the state of development of the Company, as the same may be increased thereafter pursuant to the Company's normal practices for its executives. The Base Salary shall be paid at such intervals as the Company pays executive salaries generally. During the Employment Period, the Base Salary shall be reviewed at least annually for possible increase in the Company's discretion. Any increase in Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The Base Salary shall not be reduced after any such increase and the term "Base Salary" as utilized in this Agreement shall refer to Base Salary as so increased.

(ii)  Annual Bonus. In addition to the Base Salary, the Executive shall be eligible to earn, for each fiscal year of the Company ending during the Employment Period, an annual cash performance bonus annual Bonus") under the Company's bonus plan or plans applicable to senior executives. The amount of the Annual Bonus and the target performance goals applicable to the Annual Bonus shall be determined in accordance with the terms and conditions of such bonus plan as in effect from time to time.

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(iii)  Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all other incentive plans, practices, policies and programs, and all savings and retirement plans, practices, policies and programs, in each case that are applicable generally to senior executives of the Company.

(iv)  Welfare Benefit Plans. During the Employment Period, the Executive and the Executive's eligible family members shall be eligible for participation in the welfare benefit plans, practices, policies and programs (including, if applicable, medical, dental, disability, employee life, group life and accidental death insurance plans and programs) maintained by the Company for its senior executives.

(v)  Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in accordance with the policies, practices and procedures of the Company provided to senior executives of the Company.

(vi)  Fringe Benefits. During the Employment Period, the Executive shall be entitled to such fringe benefits and perquisites as are provided by the Company to its senior executives from time to time, in accordance with the policies, practices and procedures of the Company, and shall receive such additional fringe benefits and perquisites as the Company may, in its discretion, from time-to-time provide.

(vii)  Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the plans, policies, programs and practices of the Company applicable to its senior executives.

(viii)  Additional Payments. The amount of compensation payable to Executive pursuant to Sections 2(b)(i) and (ii) above shall be "grossed up" as necessary (on an after-tax basis) to compensate for any additional social security withholding taxes due as a result of Executive's shared employment by any subsidiary and/or affiliate of the Company, the Company, if applicable.

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3. Termination of Employment.

(a)  Death or Disability. The Executive's employment shall terminate automatically upon the Executive's death or Disability during the Employment Period. For purposes of this Agreement, "Disability" shall mean the absence of the Executive from the Executive's duties with the Company on a full-time basis for 90 consecutive days or on a total of 180 days in any 12-month period, in either case as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive's legal representative.

(b)  Cause. The Company may terminate the Executive's employment during the Employment Period for Cause or without Cause. For purposes of this Agreement, "Cause" shall mean the occurrence of any one or more of the following events unless the Executive fully corrects the circumstances constituting Cause within a reasonable period of time after receipt of the Notice of Termination (as defined below):

(i)  the Executive's willful and continued failure to substantially perform his duties with the Company (other than any such failure resulting from the Executive's incapacity due to physical or mental illness or any such actual or anticipated failure after his issuance of a Notice of Termination for Good Reason), after a written demand for substantial performance is delivered to the Executive by the Board, which demand specifically identifies the manner in which the Board believes that the Executive has not substantially performed his duties;

(ii)  the Executive's willful commission of an act of fraud or dishonesty resulting in economic or financial injury to the Company;

(iii)  the Executive's conviction of, or entry by the Executive of a guilty plea to the commission of a felony or a crime involving moral turpitude;

(iv)  a willful breach by the Executive of his fiduciary duty to the Company which results in economic or other injury to the Company; or

(v)  the Executive's willful and material breach of the Executive's covenants set forth in Section 9 hereof.

For purposes of this provision, no act or failure to act, on the part of the Executive, shall be considered "willful" unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive's action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than two-thirds of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel for the Executive, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of any of the conduct described in Section 3(b), and specifying the particulars thereof in detail; provided, that if the Executive is a member of the Board, the Executive shall not vote on such resolution nor shall the Executive be counted in determining the "entire membership" of the Board.

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(c) Good Reason. The Executive's employment may be terminated by the Executive for Good Reason or by the Executive without Good Reason. For purposes of this Agreement, "Good Reason" shall mean the occurrence of any one or more of the following events without the Executive's prior written consent, unless the Company fully corrects the circumstances constituting Good Reason (provided such circumstances are capable of correction) prior to the Date of Termination (as defined below):

(i)  the assignment to the Executive of any duties materially inconsistent in any respect with the Executive's position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 2 of this Agreement, or any other action by the Company which results in a material diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(ii)  the Company's reduction of the Executive's annual base salary or bonus opportunity, each as in effect on the date hereof or as the same may be increased from time to time;

(iii)  the relocation of the Company's offices at which the Executive is principally employed (the "Principal Location") to a location more than thirty (30) miles from such location, or the Company's requiring the Executive to be based at a location more than thirty (30) miles from the Principal Location, except for required travel on the Company's business to an extent substantially consistent with the Executive's present business travel obligations;

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(iv)  the Company's failure to obtain a satisfactory agreement from any successor to assume and agree to perform this Agreement, as contemplated in Section 10 hereof; or

(v)  the Company's failure to cure a material breach of its obligations under the Agreement after written notice is delivered to the Board by the Executive which specifically identifies the manner in which the Executive believes that the Company has breached its obligations under the Agreement and the Company is given a reasonable opportunity to cure any such breach.

(d)  Notice of Termination. Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other parties hereto given in accordance with Section 12(c) of this Agreement. For purposes of this Agreement, a "Notice of Termination" means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty days after the giving of such notice). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive's or the Company's rights hereunder.

(e)  Date of Termination. "Date of Termination" means (i) if the Executive's employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein (which date shall not be more than 30 days after the giving of such notice), as the case may be, (ii) if the Executive's employment is terminated by the Company other than for Cause or Disability, the Date of Termination shall be the date on which the Company notifies the Executive of such termination, (iii) if the Executive's employment is terminated by the Executive without Good Reason, the Date of Termination shall be the tenth day after the date on which the Executive notifies the Company of such termination, unless otherwise agreed by the Company and the Executive, and (iv) if the Executive's employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death or Disability of the Executive, as the case may be.

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4. Obligations of the Company upon Termination.

(a) Without Cause or For Good Reason. If, during the Employment Period, the Company shall terminate the Executive's employment without Cause or the Executive shall terminate his employment for Good Reason:

(i)  The Executive shall be paid, in a single lump sum payment within 60 days after the Date of Termination, the aggregate amount of (A) the Executive's earned but unpaid Base Salary and accrued vacation pay through the Date of Termination, and any Annual bonus required to be paid to the Executive pursuant to Section 2(b)(ii) above for any fiscal year of the Company that ends on or before the Date of Termination to the extent not previously paid (the "Accrued Obligations"), and (B) two (the "Severance Multiple") times the sum of (x) the annual Base Salary in effect on the Termination Date plus (y) the average Annual Bonus received by the Executive for the three complete fiscal years (or such lesser number of years as the Executive has been employed by the Company) of the Company immediately prior to the Termination Date (the "Severance Amount");

(ii)  At the time when annual bonuses are paid to the Company's other senior executives for the fiscal year of the Company in which the Date of Termination occurs, the Executive shall be paid an Annual Bonus in an amount equal to the product of (x) the amount of the Annual Bonus to which the Executive would have been entitled if the Executive's employment had not been terminated, and (y) a fraction, the numerator of which is the number of days in such fiscal year through the Date of Termination and the denominator of which is the total number of days in such fiscal year (a "Pro-Rated Annual Bonus");

(iii)  For a period of years equal to the Severance Multiple, the Company shall continue to provide the Executive and the Executive's eligible family members with group health insurance coverage at least equal to that which would have been provided to them if the Executive's employment had not been terminated; provided, however, that if the Executive becomes re-employed with another employer and is eligible to receive group health insurance coverage under another employer's plans, the Company's obligations under this Section 4(a)(iii) shall be reduced to the extent comparable coverage is actually provided to the Executive and the Executive's eligible family members, and any such coverage shall be reported by the Executive to the Company.

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(iv)  The Company shall, at its sole expense and on an as-incurred basis, provide the Executive with outplacement services the scope and provider of which shall be reasonable and consistent with industry practice for similarly situated executives; and

(v)  To the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any vested benefits and other amounts or benefits required to be paid or provided or which the Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliates (such other amounts and benefits shall be hereinafter referred to as the "Other Benefits").

Notwithstanding the foregoing, it shall be a condition to the Executive's right to receive the amounts provided for in Sections 4(a)(i)(B) and 4(a)(ii), (iii) and (iv) above that the Executive execute, deliver to the Company and not revoke a release of claims in substantially the form attached hereto as Exhibit A.

(b)  For Cause or Without Good Reason. If the Executive's employment shall be terminated by the Company for Cause or by the Executive without Good Reason during the Employment Period, the Company shall have no further obligations to the Executive under this Agreement other than pursuant to Sections 7 and 8 hereof, and the obligation to pay to the Executive the Accrued Obligations in cash within 30 days after the Date of Termination and to provide the Other Benefits.

(c)  Death or Disability. If the Executive's employment is terminated by reason of the Executive's death or Disability during the Employment Period:

(i)  The Accrued Obligations shall be paid to the Executive's estate or beneficiaries or to the Executive, as applicable, in cash within 30 days of the Date of Termination;

(ii)  100% of the Executive's annual Base Salary, as in effect on the Date of Termination, shall be paid to the Executive's estate or beneficiaries or to the Executive, as applicable, in cash within 30 days following the Date of Termination;

(iii)  The Pro-Rated Annual Bonus shall be paid to the Executive's estate or beneficiaries or to the Executive, as applicable, at the time when annual bonuses are paid to the Company's other senior executives for the fiscal year of the Company in which the Date of Termination occurs;

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(iv)  For a period of twelve months following the Date of Termination, the Executive and the Executive's eligible family members shall continue to be provided with group health insurance coverage at least equal to that which would have been provided to them if the Executive's employment had not been terminated; provided, however, that if the Executive becomes re-employed with another employer and is eligible to receive group health insurance coverage under another employer's plans, the Company's obligations under this Section 4(d)(iv) shall be reduced to the extent comparable coverage is actually provided to the Executive and the Executive's eligible family members, and any such coverage shall be reported by the Executive to the Company; and

(v)  The Other Benefits shall be paid or provided to the Executive on a timely basis.

5. Termination Upon a Change in Control. If a Change in Control (as defined herein) occurs during the Employment Period and the Executive's employment is terminated (a) by the Company without Cause or by the Executive for Good Reason, in each case within two (2) years after the effective date of the Change in Control or (b) by the Executive for any reason on or within 30 days after the one year anniversary of the effective date of the Change in Control, then the Executive shall be entitled to the payments and benefits provided in Section 4(a), subject to the terms and conditions thereof, except that for purposes of this Section 5, the Severance Multiple shall equal three (3). In addition, in the event of such a termination of the Executive's employment, all outstanding stock options, restricted stock and other equity awards granted to the Executive under any of the Company's equity incentive plans (or awards substituted therefore covering the securities of a successor company) shall become immediately vested and exercisable in full. For purposes of this Agreement, "Change in Control" shall mean the occurrence of any of the following events:

(i) the acquisition, directly or indirectly, by any "person" or "group" (as those terms are defined in Sections 3(a)(9), 13(d), and 14(d) of the Securities Exchange Act of 1934 (the "Exchange Act") and the rules thereunder) of "beneficial ownership" (as determined pursuant to Rule 13d-3 under the Exchange Act) of securities entitled to vote generally in the election of directors ("voting securities") of the Company that represent 35% or more of the combined voting power of the Company's then outstanding voting securities, other than

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(A)  an acquisition of securities by a trustee or other fiduciary holding securities under any employee benefit plan (or related trust) sponsored or maintained by the Company or any person controlled by the Company or by any employee benefit plan (or related trust) sponsored or maintained by the Company or any person controlled by the Company, or

(B)  an acquisition of securities by the Company or a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the stock of the Company, or

(C)  an acquisition of securities pursuant to a transaction described in clause (iii) below that would not be a Change in Control under clause (iii), or

(D)  any direct or indirect acquisition of securities by the Executive or his family, or any entity controlled thereby;

Notwithstanding the foregoing, the following event shall not constitute an "acquisition" by any person or group for purposes of this clause (i): an acquisition of the Company's securities by the Company which causes the Company's voting securities beneficially owned by a person or group to represent 35% or more of the combined voting power of the Company's then outstanding voting securities; provided, however, that if a person or group shall become the beneficial owner of 35% or more of the combined voting power of the Company's then outstanding voting securities by reason of share acquisitions by the Company as described above and shall, after such share acquisitions by the Company, become the beneficial owner of any additional voting securities of the Company, then such acquisition shall constitute a Change in Control;

(ii) individuals who, as of the Effective Date, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election by the Company's shareholders, or nomination for election by the Board, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an election contest with respect to the election or removal of directors or other solicitation of proxies or consents by or on behalf of a person other than the Board;

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(iii) the consummation by the Company (whether directly involving the Company or indirectly involving the Company through one or more intermediaries) of (x) a merger, consolidation, reorganization, or business combination or (y) a sale or other disposition of all or substantially all of the Company's assets or (z) the acquisition of assets or stock of another entity, in each case, other than a transaction

(A)  which results in the Company's voting securities outstanding immediately before the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the Company's assets or otherwise succeeds to the business of the Company (the Company or such person, the "Successor Entity")) directly or indirectly, at least 50% of the combined voting power of the Successor Entity's outstanding voting securities immediately after the transaction, and

(B)  after which no person or group beneficially owns voting securities representing 35% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (B) as beneficially owning 35% or more of combined voting power of the Successor Entity solely as a result of the voting power held in the Company prior to the consummation of the transaction; or

(iv) approval by the Company's shareholders of a liquidation or dissolution of the Company.

For purposes of clause (i) above, the calculation of voting power shall be made as if the date of the acquisition were a record date for a vote of the Company's shareholders, and for purposes of clause (iii) above, the calculation of voting power shall be made as if the date of the consummation of the transaction were a record date for a vote of the Company's shareholders.

6. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive's continuing or future participation in any plan, program, policy or practice provided by the Company and for which the Executive may qualify, nor shall anything herein limit or otherwise affect such rights as the Executive may have under any contract or agreement with the Company. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.

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7.  Full Settlement. The Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and except as expressly provided, such amounts shall not be reduced whether or not the Executive obtains other employment. The Company agrees to pay as incurred (within 30 days following the Company's receipt of an invoice from the Executive), to the full extent permitted by law, all reasonable legal fees and expenses which the Executive or his beneficiaries may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive or his beneficiaries about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(A) of the Code. The preceding sentence shall not apply with respect to any such contest if the court having jurisdiction over such contest determines that the Executive's claim in such contest is frivolous or maintained in bad faith.

8.  Certain Additional Payments by the Company.

(a) Anything in this Agreement to the contrary notwithstanding and except as set forth below, in the event it shall be determined that any Payment would be subject to the Excise Tax, then the Executive shall be entitled to receive an additional payment (the "Excise Tax Gross-Up Payment") in an amount such that, after payment by the Executive of all taxes (and any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Excise Tax Gross-Up Payment, the Executive retains an amount of the Excise Tax Gross-Up Payment equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing provisions of this Section 8(a), if it shall be determined that the Executive is entitled to the Excise Tax Gross-Up Payment, but that the Parachute Value of all Payments does not exceed 110% of the Safe Harbor Amount, then no Excise Tax Gross-Up Payment shall be made to the Executive and the amounts payable under this Agreement shall be reduced so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount. The reduction of the amounts payable hereunder, if applicable, shall be made by first reducing the payments under Section 4(a)(i), unless an alternative method of reduction is elected by the Executive, and in any event shall be made in such a manner as to maximize the Value of all Payments actually made to the Executive. For purposes of reducing the Payments to the Safe Harbor Amount, only amounts payable under this Agreement (and no other Payments) shall be reduced. If the reduction of the amount payable under this Agreement would not result in a reduction of the Parachute Value of all Payments to the Safe Harbor Amount, no amounts payable under the Agreement shall be reduced pursuant to this Section 8(a). The Company's obligation to make Excise Tax Gross-Up Payments under this Section 8 shall not be conditioned upon the Executive's termination of employment.

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(b) Subject to the provisions of Section 8(c), all determinations required to be made under this Section 8, including whether and when an Excise Tax Gross-Up Payment is required, the amount of such Excise Tax Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by such nationally recognized accounting firm as may be selected by the Company and reasonably acceptable to the Executive (the "Accounting Firm"); provided, that the Accounting Firm's determination shall be made based upon "substantial authority" within the meaning of Section 6662 of the Code. The Accounting Firm shall provide detailed supporting calculations both to the Company and the Executive within 15 business days of the receipt of notice from the Executive that there has been a Payment or such earlier time as is requested by the Company. All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Excise Tax Gross-Up Payment, as determined pursuant to this Section 8, shall be paid by the Company to the Executive within five days of the receipt of the Accounting Firm's determination. Any determination by the Accounting Firm shall be binding upon the Company and the Executive, unless the Company obtains an opinion of outside legal counsel, based upon at least "substantial authority" within the meaning of Section 6662 of the Code, reaching a different determination, in which event such legal opinion shall be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Excise Tax Gross-Up Payments that will not have been made by the Company should have been made (the "Underpayment"), consistent with the calculations required to be made hereunder. In the event the Company exhausts its remedies pursuant to Section 8(c) and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive.

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(c) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Excise Tax Gross-Up Payment. Such notification shall be given as soon as practicable, but no later than 10 business days after the Executive is informed in writing of such claim. The Executive shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which the Executive gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to the expiration of such period that the Company desires to contest such claim, the Executive shall:

(i)  give the Company any information reasonably requested by the Company relating to such claim,

(ii)  take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company,

(iii)  cooperate with the Company in good faith in order effectively to contest such claim, and

(iv)  permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties) imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Section 8(c), the Company shall control all proceedings taken in connection with such contest, and, at its sole discretion, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the applicable taxing authority in respect of such claim and may, at its sole discretion, either direct the Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that, if the Company directs the Executive to pay such claim and sue for a refund, the Company shall advance the amount of such payment to the Executive, on an interest-free basis, and shall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties) imposed with respect to such advance or with respect to any imputed income in connection with such advance; and provided, further, that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the contest shall be limited to issues with respect to which the Excise Tax Gross-Up Payment would be payable hereunder, and the Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

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(d)  If, after the receipt by the Executive of an Excise Tax Gross-Up Payment or an amount advanced by the Company pursuant to Section 8(c), the Executive becomes entitled to receive any refund with respect to the Excise Tax to which such Excise Tax Gross-Up Payment relates or with respect to such claim, the Executive shall (subject to the Company's complying with the requirements of Section 8(c), if applicable) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 8(c), a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Excise Tax Gross-Up Payment required to be paid.

(e)  Notwithstanding any other provision of this Section 8, the Company may, in its sole discretion, withhold and pay over to the Internal Revenue Service or any other applicable taxing authority, for the benefit of the Executive, all or any portion of any Excise Tax Gross-Up Payment, and the Executive hereby consents to such withholding.

(f)  Any other liability for unpaid or unwithheld Excise Taxes shall be borne exclusively by the Company, in accordance with Section 3403 of the Code. The foregoing sentence shall not in any manner relieve the Company of any of its obligations under this Employment Agreement.

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(g) Definitions. The following terms shall have the following meanings for poses of this Section 8:

(i)  "Excise Tax" shall mean the excise tax imposed by Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.

(ii)  "Parachute Value" of a Payment shall mean the present value as of the date of the change of control for purposes of Section 280G of the Code of the portion of such Payment that constitutes a "parachute payment" under Section 280G(b)(2), as determined by the Accounting Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment.

(iii)  A "Payment" shall mean any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise.

(iv)  The "Safe Harbor Amount" shall mean 2.99 times the Executive's "base amount," within the meaning of Section 280G(b)(3) of the Code.

(v)  "Value" of a Payment shall mean the economic present value of a Payment as of the date of the change of control for purposes of Section 280G of the Code, as determined by the Accounting Firm using the discount rate required by Section 280G(d)(4) of the Code.

9. Confidential Information and Non-Solicitation.

(a) In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement. However, in recognition of the facts that irreparable injury will result to the Company in the event of a breach by the Executive of his obligations under Sections 9(a) and (b) of this Agreement, that monetary damages for such breach would not be readily calculable, and that the Company would not have an adequate remedy at law therefor, the Executive acknowledges, consents and agrees that in the event of such breach, or the threat thereof, the Company shall be entitled, in addition to any other legal remedies and damages available, to specific performance thereof and to temporary and permanent injunctive relief (without the necessity of posting a bond) to restrain the violation or threatened violation of such obligations by the Executive.

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(b) The Employee shall, at all times during and subsequent to the Term, keep secret and retain in strictest confidence all confidential matters of the Company, and the "know-how", trade secrets, technical processes, inventions, equipment specifications, equipment designs, plans, drawings, research projects, confidential client lists, details of client, subcontractor or consultant contracts, pricing policies, operational methods, marketing plans and strategies, project development, acquisition and bidding techniques and plans, business acquisition plans, and new personnel acquisition plans of the Company and its subsidiaries and divisions (whether now known or hereafter learned by the Employee), except to the extent that (i) such information is generally available to the public without restriction, (ii) the Employee obtains confidentiality agreements with respect to such confidential information, (iii) the Employee is requested by the Board of Directors of the Company or a Committee thereof, or by the Chairman of the Company, to disclose such confidential information, (iv) such information is provided to a customer of the Company pursuant to a request received from such customer in the ordinary course of business, or (v) the Employee is under compulsion of either a court order or a governmental agency's or authority's inquiry, order or request to so disclose such information.

(c) Property of the Company.

(i)  Except as otherwise provided herein, all lists, records and other non-personal documents or papers (and all copies thereof) relating to the Company and/or any of its subsidiaries or divisions, including such items stored in computer memories, on microfiche or by any other means, made or compiled by or on behalf of the Employee, or made available to the Employee, are and shall be the property of the Company, and shall be delivered to the Company on the date of termination of the Employee's employment with the Company, or sooner upon request of the Company at any time or from time to time.

(ii)  All inventions, including any procedures, formulas, methods, processes, uses, apparatuses, patterns, designs, plans, drawings, devices or configurations of any kind, any and all improvements to them which are developed, discovered, made or produced, and all trade secrets and information used by the Company and/or its subsidiaries and divisions (including, without limitation, any such matters created or developed by the Employee during the term of this Agreement), shall be the exclusive property of the Company or the subject subsidiary, and shall be delivered to the Company or the subject subsidiary (without the Employee retaining any copies, components or records thereof) on the date of termination of the Employee's employment with the Company; provided, however, that nothing herein contained shall be deemed to grant to the Company any property rights in any inventions or other intellectual property which may at any time be developed by the Employee which is wholly unrelated to any business then engaged in or under development by the Company.

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(d)  The Employee shall not, at any time (whether during the term of this Agreement or at any time thereafter), directly or indirectly, for or on behalf of any business enterprise other than the Company and/or its subsidiaries and affiliates, solicit any employee of the Company or any of its subsidiaries to leave his or her employment with the Company or such subsidiary, or encourage any such employee to leave such employment, without the prior written approval of the Company in each instance.

(e)  Non-Competition. For so long as the Employee shall be receiving any compensation or remuneration under this Agreement, and for a further period of one (1) year thereafter, the Employee shall not, directly or indirectly, whether individually or as an employee, stockholder (other than the passive ownership of up to 5% of the capital stock of a publicly traded corporation), partner, joint venturer, agent or other representative of any other person, firm or corporation, engage or have any interest in any business (other than the Company or any of its subsidiaries or affiliates) which, in any country in which the Company or any of its subsidiaries or divisions does or solicits business during the Term, is engaged in or derives any revenues from performing any functionally equivalent services or marketing any functionally equivalent products as those services provided and products marketed by the Company or any of its subsidiaries or divisions during the Term.

(f)  Severability of Covenants. The Employee acknowledges and agrees that the provisions of this Section 9 of this Agreement are (a) made in consideration of the premises and undertakings of the Company set forth herein, (b) made for good, valuable and adequate consideration received and to be received by the Employee, and (c) reasonable and necessary, in terms of the time, geographic scope and nature of the restrictions, for the protection of the Company and the business and good will thereof. It is intended that the provisions of this Section 9 be fully severable, and in the event that any of the foregoing restrictions, or any portion of the foregoing restrictions, shall be deemed contrary to law, invalid or unenforceable in any respect by any court or tribunal of competent jurisdiction, then such restrictions shall be deemed to be amended, modified and reduced in scope and effect, as to duration and/or geographic area, only to that extent necessary to render same valid and enforceable (and in such reduced form, such provisions shall then be enforceable), and any other of the foregoing restrictions shall be unaffected and shall remain in full force and effect.

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(g) Equitable Remedies. The parties hereby acknowledge that, in the event of any breach or threatened breach by the Employee of the provisions of this Section 9, the Company will suffer irreparable harm and will not have an adequate remedy at law. Accordingly, in the event of any such breach or threatened breach, the Company may seek and obtain appropriate equitable relief to restrain or enjoin such breach or threatened breach and/or to compel compliance herewith.

(h) Trade Secrets. The Parties hereby agree and stipulate that any confidential information of the Parties shall be deemed a "trade secret" as that term is defined under the Economic Espionage Act of 1996 (the "Act"), and further agree and stipulate that the Parties by this Agreement have taken all reasonable steps under the Act to keep such information secret.

10. Successors.

(a)  This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.

(b)  This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

(c)  The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, "Company" shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

11. Payment of Financial Obligations. The payment or provision to the Executive by the Company of any remuneration, benefits or other financial obligations pursuant to this Agreement shall be allocated to the Company and, if applicable, any subsidiary and/or affiliate thereof from time to time.

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12. Miscellaneous.

(a)  Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b)  Arbitration. Except as set forth in Section 9(c) above, any disagreement, dispute, controversy or claim arising out of or relating to this Agreement or the interpretation of this Agreement or any arrangements relating to this Agreement or contemplated in this Agreement or the breach, termination or invalidity thereof shall be settled by final and binding arbitration administered by the America Arbitration Association in Allentown, Pennsylvania in accordance with the then existing American Arbitration Association Rules and Procedures for Employment Disputes. In the event of such an arbitration proceeding, the Executive and the Company shall select a mutually acceptable neutral arbitrator from among the American Arbitration Association panel of arbitrators. In the event the Executive and the Company cannot agree on an arbitrator, the Administrator of American Arbitration Association will appoint an arbitrator. Neither the Executive nor the Company nor the arbitrator shall disclose the existence, content, or results of any arbitration hereunder without the prior written consent of all parties. Except as provided herein, the Federal Arbitration Act shall govern the interpretation, enforcement and all proceedings. The arbitrator shall apply the substantive law (and the law of remedies, if applicable) of the state of Colorado, or federal law, or both, as applicable, and the arbitrator is without jurisdiction to apply any different substantive law. The arbitrator shall have the authority to entertain a motion to dismiss and/or a motion for summary judgment by any party and shall apply the standards governing such motions under the Federal Rules of Civil Procedure. The arbitrator shall render an award and a written, reasoned opinion in support thereof. Judgment upon the award may be entered in any court having jurisdiction thereof.

(c)  Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive: at the Executive's most recent address on the records of the Company,

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If to the Company: at the Company's principal offices, attention of the Company's Secretary and President.

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective hen actually received by the addressee.

(d)  Sarbanes-Oxley Act of 2002. Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that any transfer or deemed transfer of funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of the Exchange Act and the rules and regulations promulgated thereunder, then such transfer or deemed transfer shall not be made to the extent necessary or appropriate so as not to violate the Exchange Act and the rules and regulations promulgated thereunder.

(e)  Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(f)  Withholding. The Company may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation. In addition, notwithstanding any other provision of this Agreement, the Company may, in its sole discretion, withhold and pay over to the Internal Revenue Service or any other applicable taxing authority, for the benefit of the Executive, all or any portion of any Excise Tax Gross-Up Payment, and the Executive hereby consents to such withholding.

(g)  No Waiver. The Executive's or the Company's failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 3(c) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

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(h)  Entire Agreement. As of the Effective Date, this Agreement, together with any non-competition agreement between the parties, constitutes the final, complete and exclusive agreement between the Executive and the Company with respect to the subject matter hereof and replaces and supersedes any and all other agreements, offers or promises, whether oral or written, made to you by any related entity, or representative of the Company or the transactions related thereto. The Executive agrees that any such agreement, offer or promise between the Executive and Employer (or any representative thereof) is hereby terminated and will be of no further force or effect, and the Executive acknowledges and agrees that upon his execution of this Agreement, he will have no right or interest in or with respect to any such agreement, offer or promise. In the event that the Effective Date does not occur, this Agreement (including, without limitation, the immediately preceding sentence) shall have no force or effect.

(i)  Counterparts. This Agreement may be executed simultaneously in two counterparts, each of which shall be deemed an original but which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year written below.

American Energy Partners, Inc.

A Colorado Corporation

By:

Name: Brad Domitrovitsch

Title: President

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EXECUTIVE

/s/ Brad Domitrovitsch

Brad Domitrovitsch

EFFECTIVE DATE:

Dated: January 1, 2017

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EXHIBIT A

GENERAL RELEASE

For a valuable consideration, the receipt and adequacy of which are hereby acknowledged, the undersigned does hereby release and forever discharge the "Releasees" hereunder, consisting of American Energy Partners, Inc., a Colorado corporation, and each of their partners, subsidiaries, associates, affiliates, successors, heirs, assigns, agents, directors, officers, employees, representatives, lawyers, insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, losses, costs, attorneys' fees or expenses, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called "Claims"), which the undersigned now has or may hereafter have against the Releasees, or any of them, by reason of any matter, cause, or thing whatsoever from the beginning of time to the date hereof. The Claims released herein include, without limiting the generality of the foregoing, any Claims in any way arising out of, based upon, or related to the employment or termination of employment of the undersigned by the Releasees, or any of them; any alleged breach of any express or implied contract of employment; any alleged torts or other alleged legal restrictions on Releasee's right to terminate the employment of the undersigned; and any alleged violation of any federal, state or local statute or ordinance including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination In Employment Act, the Americans With Disabilities Act, and the Colorado Fair Employment and Housing Act.

THE UNDERSIGNED ACKNOWLEDGES THAT HE HAS BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF RELEVANT LAW, WHICH PROVIDES GENERALLY AS FOLLOWS:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

THE UNDERSIGNED, BEING AWARE OF SAID LAW, HEREBY EXPRESSLY WAIVES ANY RIGHTS HE MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.

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THE UNDERSIGNED IS HEREBY ADVISED AS FOLLOWS:

(A)  HE HAS THE RIGHT TO CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS RELEASE;

(B)  HE HAS TWENTY-ONE (21) DAYS TO CONSIDER THIS RELEASE BEFORE SIGNING IT; AND

(C)  HE HAS SEVEN (7) DAYS AFTER SIGNING THIS RELEASE TO REVOKE THIS RELEASE, AND THIS RELEASE WILL BECOME EFFECTIVE UPON THE EXPIRATION OF THAT REVOCATION PERIOD.

The undersigned represents and warrants that there has been no assignment or other transfer of any interest in any Claim which he may have against Releasees, or any of them, and the undersigned agrees to indemnify and hold Releasees, and each of them, harmless from any liability, Claims, demands, damages, costs, expenses and attorneys' fees incurred by Releasees, or any of them, as the result of any such assignment or transfer or any rights or Claims under any such assignment or transfer. It is the intention of the parties that this indemnity does not require payment as a condition precedent to recovery by the Releasees against the undersigned under this indemnity.

The undersigned agrees that if he hereafter commences any suit arising out of, based upon, or relating to any of the Claims released hereunder or in any manner asserts against Releasees, or any of them, any of the Claims released hereunder, then the undersigned agrees to pay to Releasees, and each of them, in addition to any other damages caused to Releasees thereby, all attorneys' fees incurred by Releasees in defending or otherwise responding to said suit or Claim.

The undersigned further understands and agrees that neither the payment of any sum of money nor the execution of this Release shall constitute or be construed as an admission of any liability whatsoever by the Releasees, or any of them, who have consistently taken the position that they have no liability whatsoever to the undersigned.

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IN WITNESS WHEREOF, the undersigned has executed this Release this 1st day of January, 2017.

/s/ Brad Domitrovitsch

[name]

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EX1A-6 MAT CTRCT

Exhibit 6.2 

Docket No. 140552.00101 PATENT

NATURAL PIPELINE WATER CONVEYANCE SYSTEM AND METHOD

CROSS-REFERENCE TO RELATED APPLICATIONS

[0001] This application claims priority to U.S. provisional application Serial No. 61/812,486 filed April 16, 2013, which is incorporated herein by reference in its entirety.

TECHNOLOGY FIELD

[0002] The present invention relates generally to a water conveyance system and method of supplying water using a natural water pipeline and more particularly to methods and systems to treat water from upstream impaired water sites, convey the treated water to downstream water withdrawing entities and provide water withdrawing rights to the water withdrawing entities in exchange for monetary value.

BACKGROUND

[0003] Many end users, such as utility companies, pipeline companies, and municipalities withdraw water from natural water bodies of fresh water for daily use. Some end users, such as natural gas companies, municipalities, and pipeline companies, use large amounts of water during their daily operations. For example, natural gas companies may use water in a technique known as hydraulic fracturing, commonly known as fracing. Fracing includes creating fissures in rocks (e.g. shale) under the surface by a pressurized fluid made up of water, sand and additives to release petroleum, gas (e.g. natural gas) or other substances into a wellbore to be collected at the surface. A typical natural gas well requires a continuous flow of fresh water to operate and may use 3.5 million gallons of water per fracing event. Fracing events may occur multiple times per year, resulting in a large ratio (typically 25-30%) of the cost of operation for the gas company.

[0004] The end users typically operate proximate to a fresh water supply, such as a river or stream, to retrieve the continuous flow of fresh water needed for operation. Conditions of the fresh water supply may change during the year, however, which limits or prevents use of the fresh water supply for distribution to the end users. For example, government restrictions (e.g. pass-by restriction) prevent the end users from using the fresh water supply (e.g. a river) if the water supply moves below a certain water level, such as from drought conditions.

[0005] To avoid shut down during times when the end users are prevented, or otherwise limited, from using the fresh water (e.g. from pass-by restriction), water from other sources, such as treated water may be transported by truck or pipeline to the end user. The treated water often originates from impaired water bodies, such as acid mine drainage (AMD) water bodies and mine pool water bodies. Conventional systems and methods of supplying water from impaired water bodies include trucking the impaired water and piping the impaired water from the impaired water supplies to treatment and/or storage facilities either at the operation sites or at a remote location from which the treated water is shipped. In either case, costly trucking or piping is used in at least one phase of moving impaired water to the treatment facility and/or the operation sites.

[0006] These conventional systems and methods for supplying the water from impaired water bodies are typically inefficient and expensive alternatives. A more efficient and environmental friendly system and method of supplying water to the end users is needed.

SUMMARY

[0007] Embodiments of the present invention are directed to a method of supplying water using a natural water pipeline that includes withdrawing impaired water from an impaired water body connected to a waterway and treating the impaired water from the impaired water body to produce treated water. The method also includes discharging the treated water into the waterway and conveying the treated water via the waterway to one or more locations proximate to one or more remote operational facilities that withdraws water from the waterway at the one or more locations. The method further includes receiving a monetary value from one or more operational entities operating the one or more remote operational facilities and providing at least a portion of one or more water access rights to the one or more operational entities in exchange for the monetary value.

[0008] In one embodiment, withdrawing impaired water further includes withdrawing impaired water from an acid mined drainage water body.

[0009] In another embodiment, withdrawing impaired water further includes withdrawing impaired water from a mine pool water body.

[0010] According to an embodiment, providing at least a portion of the one or more water access rights further includes providing a right to withdraw the water at the one or more locations of the waterway when a flow level of the water is less than or equal to a predetermined pass-by water level threshold.

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Docket No. 140552.00101 PATENT

[0011] According to another embodiment, providing at least a portion of the one or more water access rights further includes providing a right to withdraw the water at the one or more locations of the waterway until the flow level of the water is less than or equal to a predetermined relief water level threshold that is lower than the predetermined pass-by water level threshold.

[0012] In yet another embodiment, receiving a monetary value further includes receiving a monetary value based on an amount of the water to be withdrawn at the one or more locations of the waterway for a predetermined amount of time when a flow level of the water is less than or equal to a predetermined pass-by water level threshold.

[0013] In an aspect of an embodiment, the method further includes providing a plurality of selectable water access rights options to withdraw the water at the one or more locations of the waterway. Each of the plurality of selectable water access rights options has a respective monetary value based on a corresponding amount of the water to be withdrawn at the one or more locations of the waterway for a corresponding predetermined amount of time.

[0014] In one embodiment, providing at least a portion of one or more water access rights further includes providing a right to withdraw the water at the one or more locations of the waterway with one of: (i) a reduced consumptive use fee; and (ii) a waived consumptive use fee.

[0015] In another embodiment, providing at least a portion of one or more water access rights further includes providing one or more credits to the one or more operational entities, wherein each of the one or more credits correlates to an amount of the water to be withdrawn at the one or more locations of the waterway.

[0016] According to an embodiment, the method further includes receiving the one or more water access rights from a water rights granting entity and providing at least a portion of the one or more water access rights received from the rights granting entity to the one or more remote operational facilities.

[0017] According to another embodiment, the method further includes causing the one or more water access rights to be provided to the one or more remote operational facilities from a water rights granting entity by treating the impaired water and discharging the treated water into the waterway.

[0018] According to an aspect of an embodiment, withdrawing of the impaired water from the impaired water body further includes withdrawing free flowing water from the impaired water body.

[0019] According to another aspect of an embodiment, withdrawing of the impaired water from the impaired water body further comprises withdrawing stored water from the impaired water body.

[0020] Embodiments of the present invention are directed to a method for managing water rights that includes introducing a treated water flow into a waterway from which one or more operational facilities withdraw water. The method also includes receiving, from a water access rights granting entity, one or more water access rights to withdraw the water from the waterway in exchange for introducing the treated water flow into the waterway. The method further includes providing at least a portion of the one or more water access rights to the one or more operational facilities in exchange for a monetary value.

[0021] In one embodiment, receiving one or more water access rights includes receiving rights to withdraw the water when a flow level of the water is less than or equal to a predetermined pass-by water level threshold.

[0022] In another embodiment, receiving one or more water access rights includes receiving access to the water until the flow level of the water is less than or equal to a predetermined relief water level threshold that is lower than the predetermined pass-by water level threshold.

[0023] According to an embodiment, providing at least a portion of the one or more water access rights further comprises providing one or more water access rights credits to the one or more operational facilities. The method further includes permitting the one or more operational facilities to exchange the one or more water rights credits to withdraw an amount of the water when such withdrawal would otherwise not be permitted.

[0024] According to another embodiment, receiving the one or more water access rights further includes receiving rights to withdraw an amount of the water downstream from a location where the treated water flow is introduced to the waterway based on an amount of the treated water introduced upstream.

[0025] In yet another embodiment, receiving the one or more water access rights further includes receiving rights to withdraw an amount of the water upstream from a location where the treated water flow is introduced to the waterway based on an amount of the treated water introduced to the waterway.

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Docket No. 140552.00101 PATENT

[0026] In one embodiment, providing at least a portion of the one or more water access rights further includes providing one or more rights to withdraw the water with one of: (i) a reduced consumptive use fee; and (ii) a waived consumptive use fee.

[0027] Embodiments of the present invention are directed to a water treatment and conveyance system that includes a water withdrawing system configured to withdraw impaired water from an acid mined drainage water body and a treatment system configured to treat the impaired water from the acid mined drainage water body to produce treated water. The system also includes a waterway connected to the acid mined drainage water body for conveying the treated water to one or more remote locations of the waterway and a discharge system configured to discharging the treated water into the waterway. The system further includes one or more remote operational facilities configured to withdraw water from the waterway at the one or more remote locations of the waterway.

[0028] In one embodiment, the treatment system is a passive treatment system.

[0029] Additional features and advantages of the invention will be made apparent from the following detailed description of illustrative embodiments that proceeds with reference to the accompanying drawings.

BRIEF DESCRIPTION OF THE DRAWINGS

[0030] The foregoing and other aspects of the present invention are best understood from the following detailed description when read in connection with the accompanying drawings. For the purpose of illustrating the invention, there is shown in the drawings embodiments that are presently preferred, it being understood, however, that the invention is not limited to the specific instrumentalities disclosed. Included in the drawings are the following Figures:

[0031] FIG. 1 is a diagram illustrating an exemplary water treatment and conveyance system for use with embodiments of the present invention;

[0032] FIG. 2 is a block diagram illustrating an exemplary active treatment system for use with embodiments of the present invention;

[0033] FIG. 3 is a flow diagram illustrating an exemplary method of supplying water using a natural water pipeline for use with embodiments of the present invention;

[0034] FIG. 4 is a chart illustrating exemplary cost comparisons of conventional pass-by costs to natural pipeline relief costs based on amounts of water to be withdrawn for a number of days for use with embodiments of the present invention;

[0035] FIG. 5A through FIG. 5F illustrate portions of exemplary passive systems for use with embodiments of the present invention; and

[0036] FIG. 6 is a flow diagram illustrating an exemplary method of selecting a passive system for treating impaired water that may be used with embodiments of the present invention.

DETAILED DESCRIPTION OF ILLUSTRATED EMBODIMENTS

TERMS AND CONCEPTS ASSOCIATED WITH SOME EMBODIMENTS

[0037] Pass-by flow – A Pass-by flow may refer to a flow of water associated with surface-water and ground-water. Certain withdrawal approvals are governed by pass-by flow at a water withdrawal point. A pass-by flow may be a prescribed quantity of flow that must be allowed to pass a prescribed point downstream from a water supply intake. When regulated by federal, state or local authorities, if the natural flow is equal to or less than a prescribed pass-by flow, water may not be withdrawn from the water source and the entire natural flow shall be allowed to pass the point of withdrawal.

[0038] Pass-by Relief – Pass-by Relief may refer to relief in the form of increased water withdrawal rights that are provided to a water withdrawing entity based upon their contribution to upstream clean-up efforts.

[0039] Waterway – A waterway may refer to a way or channel for water to flow that may include one or more water bodies, such as rivers, creeks and streams. A waterway may also include one or more pools, lagoons, ponds, or other bodies of water. A waterway may be natural, man-made or a combination thereof.

[0040] Natural Pipeline – A Natural Pipeline may refer to a water conveyance system that is at least partially formed by a naturally created waterway that water flows through to reach a specific point.

[0041] Consumptive Use of Water – Consumptive Use of Water may refer to the loss of water from a ground-water or surface water source through a man-made conveyance system (including such water that is purveyed through a public water supply system) due to transpiration by vegetation, incorporation into products during their manufacture, evaporation, diversion from a body of water or waterway, or any other process by which the water withdrawn is not returned to the body of water or waterway undiminished in quantity.

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Docket No. 140552.00101 PATENT

[0042] Withdrawal Permit – A withdrawal permit may refer to an approval, usually from a regulatory body, allowing the holder of the permit to take or remove water from a body of water, such as an AMD water body, waterway, stream, creek, river, etc.

[0043] Discharge permit – A discharge permit may refer to an approval, usually from a regulatory body, allowing the holder of the permit to discharge water into a waterway.

[0044] Intake – Intake may refer to a point in a waterway from which a water withdrawer withdraws water (intaking it to the water withdrawer).

[0045] Passive Treatment System – A passive system may refer to a system of treating water that can function with little or no operation or maintenance over long periods of time. Examples of passive treatment system components include: ponds; wetlands; anoxic Limestone Drains (ALDs) - buried beds of limestone that the water runs through in a controlled manner; vertical Flow Ponds (VFPs) - ponds which are constructed of organic material and limestone that drain through the bottom; and open limestone channels.

[0046] Acid Mine Drainage (AMD) water body– An acid mine drainage water body may refer to a body of water formed as a consequence of mining coal or mineral deposits that includes higher acidity levels and precipitation of dissolved metals. The acidity of coal-mine drainage may be caused by the oxidation of the mineral pyrite (FeS2), which is found in coal, coal overburden, and mine waste piles. The rate of pyrite oxidation may depend on reactive surface area of the pyrite, the oxygen concentration and pH of the water, the forms of pyrite, and the presence of Fe-oxidizing bacteria (Thiobacillus ferroxidans).

[0047] Impacted Water – Impacted Water may refer to water in a waterway resulting from drainage from impaired water bodies, such as abandoned coal mine water bodies (e.g. mine pools and AMD water bodies).

[0048] Abandoned Mine Lands– Abandoned mine lands may refer to lands, waters and surrounding watersheds where extraction, beneficiation or processing of ores and minerals has occurred that pose serious threats to human health and the environment.

[0049] Active Mine Lands – Active mine lands may refer to lands, waters and surrounding watersheds where extraction, beneficiation or processing of ores and minerals occur.

[0050] Existing Mine Channel – An existing mine channel may refer to a path or stream mine discharge created by impaired water bodies that may be connected to a waterway.

[0051] Treated Mine Channel – A treated mine channel may refer to an existing mine channel through which treated impacted waters flow.

[0052] Mine Discharge – Mine Discharge may refer to impacted waters that are emitted from a mine, which create a mine channel.

[0053] Downstream Surface Water Withdrawal – Downstream Surface Water Withdrawal may refer to a point on a waterway where an intake has been set in place downstream of an impaired water body.

EXEMPLARY EMBODIMENTS

[0054] As described above, end users, such as utility companies, may need or desire to use water from alternative sources, such as impaired water supplies, when they are prevented from using the fresh water supply proximate to their operational sites. These impaired water supplies include acid mine drainage (AMD) water bodies and mine pool water bodies. AMD water bodies are typically connected to natural waterways that may include rivers, creeks, streams and an existing mine channel. Accordingly, the impaired water from the AMD water bodies spill into the waterways, negatively affecting the natural waterways and reducing or eliminating aquatic life in the natural waterways due to a variety of factors existing in the AMD water, such as high acidity/alkalinity, volatile pH levels, dissolved metal concentration, carbon dioxide concentration, etc. A large number of national waterways, particularly those in mining states such as Pennsylvania and Ohio, are affected by these impaired water bodies. Costs have been estimated around 15 billion dollars in Pennsylvania, alone, to clean up these impaired water bodies impacting an estimated 5,000 miles of streams, without available funds to do so.

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Docket No. 140552.00101 PATENT

[0055] Conventional systems and methods of supplying water from impaired water bodies, such as AMD water bodies, may include trucking the water from the AMD sites to the remote sites. Trucking fresh water from remote AMD sites is typically inefficient because transportation costs are incurred from trucking water between the AMD sites, water treatment facilities, and/or the operation sites which use the treated water. Further, storage costs for storing the water at the operation sites are incurred. That is, in addition to treatment costs, conventional methods and systems incur inefficient transportation and storage costs. In addition to these transportation and storage costs, government regulations typically require stored water to meet certain specifications (e.g. Class 2 drinking water specifications), which are often more stringent than those required to discharge treated water into a natural waterway, particularly an impacted waterway. Expensive costs of treating the water from the AMD sites to meet these more stringent regulations are incurred. Operation costs may also include treating the water from the AMD site with chemicals to achieve a pH neutral level during the fracing process. Further, a percentage of the pre-paid fresh water that has been trucked and stored (e.g. in tanks, lagoons and impoundments) at the operation sites evaporate before the water is used for operation, resulting in further increased costs.

[0056] Conventional systems and methods of supplying water from impaired water bodies, such as AMD water bodies, may also include piping the water from the AMD sites to the operational sites. Piping the water may also be inefficient because the impaired water sites are typically located far from the operation sites, resulting in a large amount of material (e.g. pipe) costs and associated labor costs needed to lay the pipe between the operation sites and the impaired water sites. Further, both piping and trucking do not release treated water back into the natural waterways proximate to the impaired water sites. Accordingly, the ecosystems proximate to the impaired water sites remain unrestored. One of the concepts disclosed herein is releasing treated water into an impaired waterway which results in an improved water quality, at least due to dilution effect. The entire ecosystem around and downstream of such release are beneficiaries of the treated water.

[0057] Embodiments of the present invention are directed to systems and methods of conveying treated water from impaired water bodies to one or more operation sites via a natural water pipeline, such as a waterway that may include rivers, creeks and streams. Embodiments of the present invention provide use of lesser quality of water for hydrocarbon development, reducing the demand on amounts of higher quality of water. Embodiments of the present invention reduce the harmful impact of impaired water (e.g. water from AMD sites) on the environment. Embodiments of the present invention efficiently provide water to end users, potentially at reduced costs, during times when the water would otherwise not be available. Embodiments of the present invention significantly reduce or eliminate end user transportation costs and storage costs associated with conventional trucking and pipeline water conveyance methods.

[0058] FIG. 1 is a diagram illustrating a water treatment and conveyance system 100. As shown in FIG. 1, system 100 may include an impaired water site, such as AMD water body 106. Impaired water sites, such as AMD water body 106, may include free flowing water, stored or standing water, or both free flowing water and stored water. The stored water may be stored underground or above ground. For example, water at impacted sites may be stored in underground mines or may be stored in reservoirs or impoundments.

[0059] As shown in FIG. 1, the system 100 may include a water withdrawing system 102 for withdrawing impaired water from an impaired water body, such as an AMD water body 106 that is connected to a waterway 104 that includes mine stream 104a, stream 104b and river 104c. The withdrawing system 102 may include a system that transports or pumps the stored water from the impaired water site, such as AMD water body 106, to a location of a treatment system, such as treatment system 108.

[0060] Locations of the water bodies 104a, 104b and 104c that makeup the waterway and the geometries of the water bodies 104a, 104b and 104c shown in FIG. 1 are merely exemplary. Other waterways may include any combination of connected streams, creeks, rivers and other water bodies having geometries different than the geometries of the water bodies 104a, 104b and 104c shown in FIG. 1. In some aspects, a waterway may be naturally connected to an impaired water body. For example, the mine stream 104a may be a naturally occurring water body resulting from overflow of the AMD water body 106 and flowing to the stream 104b following the path of least resistance sometimes referred to an existing mine channel. In other aspects, one or more water bodies of the waterway may be man-made. For example, the mine stream 104a may be a man-made canal.

[0061] The system 100 may also include a treatment system 108 for treating the impaired water (e.g., the free flowing water and/or the stored water) from the AMD water body 106, producing treated water that may be discharged into the natural waterway for conveyance downstream. The requirements for discharge water specifications will vary based on many factors, including federal regulations, state and local regulations, site location (state, county, town, etc.), landowner contracts, potential end use, water conditions downstream, environmental concerns/impact, etc. The specifications for dischargeable treated water, and for downstream re-use such as for hydrocarbon development, are typically less stringent than the class 2 drinking water specifications required for storing water. Because the cost to treat the water to dischargeable specifications is typically less than the cost to treat water to storable specifications, the treatment system 108 can be more cost efficient than conventional treatment methods and systems that store water for transportation via truck or pipe from the impaired water sites.

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Docket No. 140552.00101 PATENT

[0062] Treatment systems configured to treat the impaired water to meet dischargeable specifications may include passive systems or active systems or a combination of passive and active systems. The treatment system employed may vary in system type, as well as the number and type of treatments employed, from site to site depending on various factors, such as the condition of the impaired water, the required discharge water specifications and the surrounding environment. In some embodiments, the types of treatments may vary during processing, for example where more, less, and/or different treatments are desired as the impaired water changes due to treatment, settling or other factors.

[0063] The condition of the impaired water for each specific site may be assessed by performing water sampling for each specific site and may utilize hydrogeological and ground water chemistry studies. The conditions may be tested at several locations and/or times prior to, during, and after treatment. Treatment methodologies employed at a given site may be dependent on various conditions of the impaired water, such as acidity/alkalinity, pH level, dissolved metal concentration, water age/exposure, carbon dioxide concentration, oxygen content, suspended solids content, biological content, such as bacteria, algae, viruses, fungi, etc., minerals such as iron, manganese and sulfur, and other chemical pollutants, etc. Those of skill in the art will readily recognize treatable water conditions and appropriate treatment methodologies.

[0064] Depending on the site, active, passive or a combination of treatment systems may be used. FIG. 2 is a block diagram illustrating an exemplary active treatment system that may be used at one or more specific sites. Notably, impaired water is moved through the system via a variety of pumps and pipes through various treatment and handling sections which may include the addition of chemical or other treatments.

[0065] In some embodiments, a passive treatment system may be selected because it often is less costly than active systems of removing metals and acidity from impaired water bodies, such as AMD water bodies. A variety of passive systems may be used that do not require chemical inputs and take advantage of naturally occurring chemical and biological processes to cleanse impaired water bodies. A passive system generally relies on the natural flow of water from the impaired site to the natural water system to move impaired water through the treatment process and on to its final destination. An example of a passive system may include natural beds, such as a lime stone bed and one or more settling ponds. The lime in the limestone beds may adjust the pH level of the impaired water, reducing the acidity level of the impaired water and causing metals to discharge from the impaired water, settling in the settling ponds. Although using a natural limestone bed would be most cost effective, in most instances, a man-made bed or settling ponds may be employed along an existing or newly created waterway to facilitate various treatments. The use of the water’s natural flow pattern significantly reduces cost because no, or fewer, pumps, pipes, and tanks are required. Portions of passive systems may include technologies shown in FIG. 5 and may include constructed wetlands, anoxic limestone drains (ALD), successive alkalinity producing systems (SAPS), limestone ponds and open limestone channels (OLC).

[0066] Natural wetlands may be characterized by water saturated soils or sediments with supporting vegetation adapted to reducing conditions in their rhizosphere. Constructed wetlands may be man-made eco-systems that mimic their natural counterparts. They may include shallow excavations filled with flooded gravel, soil and organic matter to support wetland plants. Treatment may depend on dynamic biogeochemical interactions as impaired water travels through the constructed wetland. ALDs are abiotic systems that include buried limestone cells that passively generate bicarbonate alkalinity as anoxic water flows through. SAPS combine treatment concepts from both wetlands and ALDs. Oxygenated water is pretreated by organic matter removing O2 and Fe⁺³. The anoxic water flows through an ALD at the base of the system and limestone ponds may be built over the upwelling of a seep and the seep may be covered with limestone for treatment.

[0067] FIG. 6 is a flow diagram illustrating an exemplary method of selecting a passive system for treating impaired water that may be used with embodiments of the present invention. Embodiments may include selection of passive system technologies or components based on a number of factors including water chemistry, flow rate, and local topography and site characteristics.

[0068] Any treatment methodology suitable for the treatment of impaired water may be employed in active or passive systems. Such treatments include but are not limited to: pH adjustment;: aeration; metals removal, metal precipitation (e.g. iron, manganese, aluminum, etc.); primary equalization and precipitation; clarification, filtration, including micro-filtration or high efficiency lamella filtration; reverse osmosis or other polishing technology, pre-chlorination, chlorination, coagulation, sedimentation, desalination, disinfection, dilution, etc.

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Docket No. 140552.00101 PATENT

[0069] The water treatment and conveyance system 100 may also include a discharge system 110 for discharging the treated water into mine stream 104a of the waterway 104. Discharge systems may include one or more of a plurality of conventional discharge components, such as pumps, pipes, weirs, gates, and the like.

[0070] The waterway 104 may then be used to convey the treated water from the upstream discharge location of the mine stream 104a to one or more remote downstream locations of the waterway 104. As shown in FIG. 1, the system 100 may also include one or more remote operational facilities 112 that withdraw water from the waterway 104 at the one or more remote locations of the waterway 104. For example, as shown in FIG. 1, the system 100 may include a plurality of remote operational facilities 112 and 114. The number of downstream remote operational facilities 112 and 114 and the locations of the downstream remote operational facilities 112 and 114 shown in FIG. 1 are merely exemplary. Other embodiments may include any number of downstream remote operational facilities at different locations.

[0071] In some embodiments, the remote operational facilities 112 and 114 may be downstream or upstream (upstream from a treated water discharging location) water withdrawing entities that withdraw the water from the waterway 104 at the one or more remote locations of the waterway 104 and then transport (e.g. via truck or pipeline) the withdrawn water to end users, such as natural gas companies for fracing. For example, as shown in FIG. 1, the remote operational facility 112 may be a downstream water withdrawing entity that withdraws the water from the waterway 104 at a location on the waterway 104 proximate to the operational facility 112 and then transports (e.g. via truck or pipeline) the withdrawn water to end users, such as a natural gas company (not shown). In some embodiments, the remote operational facilities 112 and 114 that withdraw the water from the waterway 104 at the one or more remote locations of the waterway 104 may be the end users themselves. For example, as shown in FIG. 1, the downstream remote operational facility 114 may itself be an end user, such as a natural gas company, that withdraws the water from the waterway 104 at a location proximate to the operational facility 114.

[0072] FIG. 3 is a flow diagram illustrating an exemplary method 300 of supplying water using a natural water pipeline for use with embodiments of the present invention. As shown at block 302, the method 300 may include acquiring rights to an impaired site from a private land owner or the government. In some embodiments, the method may include contracting (e.g. receiving a license) to perform processes on the site from a private land owner or the government. Prior to acquiring the ownership or license, the method may include identifying a plurality of impaired water sites and selecting one or more impaired water sites to acquire from the plurality of impaired water sites. The one or more impaired water sites may be selected based on factors such as amounts of impaired water and quality of water. For example, the quality of water or its location upstream or downstream of other sites may affect the cost and difficulty of treating the water to meet dischargeable specifications.

[0073] As shown at block 304, the method 300 may include receiving permission (e.g. via one or more permits) from a water rights granting entity, such as a government regulatory commission or agency (e.g. Susquehanna River Basin Commission (SRBC), Department of Environmental Protection (DEP) and the Environmental Protection Agency (EPA)). The permits may include permission to withdraw impaired water from an impaired water body, treat the impaired water and discharge the treated water into a waterway. One or more permits may be required from one or more entities.

[0074] According to one embodiment, in exchange for treating the impaired water and introducing the treated water flow into the waterway, the entity treating the impaired water and discharging the treated water (treating entity) may receive one or more water access rights from the water rights granting entity. The treating entity may then in turn provide (e.g. sell or transfer) portions (some or all) of the one or more water access rights to any paying entity in exchange for a monetary value which ultimately funds the clean-up operations (e.g. treating impaired water and discharging the treated water). The paying entities may include any non-treating entities that withdraw water from a waterway, such as remote operational facility 112. The paying entities may include any non-treating entities that do not withdraw water from a water way, such as: (i) an end user that pays for the rights but receives the water withdrawn by remote operational facility 112; or (ii) an environmental group. The non-treating entities may also receive one or more permits to withdraw water from the waterway and/or to transfer the one or more water access rights. According to another embodiment, the one or more water access rights may be provided directly to one or more non-treating entities from the water rights granting entity through a relationship with the treating entity, for introducing the treated water flow into the waterway. In some aspects, the paying entity may direct the treating entity to provide portions of the one or more water access rights to another non-treating entity. The treating entity may then in turn provide the portions of the one or more water access rights to the other non-treating entity as directed by the paying entity.

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Docket No. 140552.00101 PATENT

[0075] According to one aspect, the water access rights may be provided to the one or more downstream or upstream operational facilities by the water rights granting entity or the treating entity. In other aspects, the water access rights may be provided to any interested entity, such as environmental entities or groups who have an interest in protecting or improving local ecosystems and the environment. These other entities may then transfer the water access rights to downstream remote operational facilities that withdraw water from the waterway, or hold them as they see fit.

[0076] The water access rights may include a right to withdraw the water at one or more locations of the waterway 104 downstream or upstream from the discharge location of the waterway 104 when a flow level of the water is less than or equal to a predetermined pass-by water level threshold. In some embodiments, the water access rights may include a right to withdraw the water until the flow level of the water is less than or equal to a predetermined relief water level threshold that is lower than the predetermined pass-by water level threshold. That is, the water access rights may include a right to withdraw the water at a reduced or lower pass-by threshold. In some embodiments, the water access rights may include a right to withdraw the water at a reduced government fee, such as a consumptive use fee for the consumptive use of water that is less than the typically imposed fee. In some embodiments, the fee may be waived and the water access rights may include a right to withdraw the water without a consumptive use fee.

[0077] In some embodiments, water access rights may be in the form of credits. For example, one or more credits may be provided to the one or more entities, such as operational entities 112 and 114, and each of the one or more credits correlates to consideration paid to secure the rights to an amount of the water to be withdrawn at the one or more locations of the waterway 104.

[0078] Embodiments may include water rights that are transferrable and water rights that are non-transferrable. In some aspects, portions of the water rights may be sold, transferred, licensed or otherwise provided to entities such as one or more remote operational facilities. In some embodiments, water rights may include rights to withdraw water from one or more waterways. For example, an operational facility, such as operational facilities 112 and 114 may pay into a general clean-up fund or to clean-up an AMD site that is upstream on a waterway different from water way 104. Accordingly, any operational facility in any waterway could benefit from relief while paying for clean-up. Embodiments may include water rights that expire after a certain period of time, water rights that do not expire, water rights that are revocable and water rights that are non-revocable.

[0079] As shown at block 306, the method 300 may include installation of a treatment facility. As described above, the requirements for discharge water specifications will vary based on many factors, and may include passive systems or active systems or a combination of passive and active systems. The treatment system employed may vary in system type, as well as the number and type of treatments employed.

[0080] As shown at block 308, the impaired water may be withdrawn from an impaired water body, such as AMD water body 106 that is connected to a mine stream 104a of waterway 104. The impaired water withdrawn from the AMD water body 106 may then be treated and discharged into a waterway connected to the impaired water body, such as mine stream 104a of waterway 104. As shown at block 310, the treated water may be conveyed via the waterway 104 downstream to one or more locations proximate to remote operational facilities 112 and 114 that withdraw water from the waterway 104. As shown at block 312, the treated water may flow to water withdrawing operational facilities, such as withdrawing operational facilities 112 and 114.

[0081] As described above, at least a portion of one or more water access rights to withdraw water may be provided. For example, at least a portion of one or more water access rights to withdraw water may be provided. In one embodiment, the rights may be provided via a contract where an entity (e.g. a downstream operational facility receives at least a portion of one or more water access rights and the entity providing the water rights (e.g. permit receiving entity that treats and discharges the water) receives consideration providing the water rights. The consideration may include a monetary value, a trade of services, and a promise to pay a monetary value.

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Docket No. 140552.00101 PATENT

[0082] FIG. 4 is a chart illustrating exemplary cost comparisons of conventional pass-by costs to natural pipeline relief costs based on amounts of water to be withdrawn for a number of days for use with embodiments disclosed herein. The rows of the chart 400 correspond to millions of gallons of water to be withdrawn per day and the columns correspond to the number of days of pass-by shut down. As shown in the chart 400, the monetary value (in dollars) may be based on an amount of the water (in millions of gallons per day) to be withdrawn for a predetermined amount of time when a flow level of the water is less than or equal to a predetermined pass-by water level threshold (days of pass-by shutdown). For example, as shown in FIG 4, a water withdrawing entity may pay a monetary value of $2,700,000 to withdraw 2 million gallons of water per day for 90 days of pass-by shut down. In one embodiment, each specific monetary value (e.g. $2,700,000) and the corresponding amount of the water to be withdrawn (e.g. 2 million gallons of water per day) for a predetermined amount of time (e.g. 90 days) may be represent a selectable water access rights option provided to a water withdrawing entity. In some aspects, a water withdrawing entity may be provided with a plurality of selectable water access rights options as shown at FIG 4. A water withdrawing entity may then choose a water access rights option based on any number of factors, such as pass-by shut down days in past years and projected pass-by shut down days in the future.

[0083] Although the invention has been described with reference to exemplary embodiments, it is not limited thereto. Those skilled in the art will appreciate that numerous changes and modifications may be made to the preferred embodiments of the invention and that such changes and modifications may be made without departing from the true spirit of the invention. It is therefore intended that the appended claims be construed to cover all such equivalent variations as fall within the true spirit and scope of the invention.

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Docket No. 140552.00101 PATENT

What is Claimed is:

1.        A method of supplying water using a natural water pipeline, comprising:

withdrawing impaired water from an impaired water body connected to a waterway;

treating the impaired water from the impaired water body to produce treated water;

discharging the treated water into the waterway;

conveying the treated water via the waterway to one or more locations proximate to one or more remote operational facilities that withdraws water from the waterway at the one or more locations;

receiving a monetary value from one or more operational entities operating the one or more remote operational facilities; and

providing at least a portion of one or more water access rights to the one or more operational entities in exchange for the monetary value.

2.       The method of claim 1, wherein withdrawing impaired water further comprises withdrawing impaired water from an acid mined drainage water body.

3.       The method of claim 1, wherein withdrawing impaired water further comprises withdrawing impaired water from a mine pool water body.

4.       The method of claim 1, wherein providing at least a portion of the one or more water access rights further comprises providing a right to withdraw the water at the one or more locations of the waterway when a flow level of the water is less than or equal to a predetermined pass-by water level threshold.

5.       The method of claim 4, wherein providing at least a portion of the one or more water access rights further comprises providing a right to withdraw the water at the one or more locations of the waterway until the flow level of the water is less than or equal to a predetermined relief water level threshold that is lower than the predetermined pass-by water level threshold.

6.       The method of claim 1, wherein receiving a monetary value further comprises receiving a monetary value based on an amount of the water to be withdrawn at the one or more locations of the waterway for a predetermined amount of time when a flow level of the water is less than or equal to a predetermined pass-by water level threshold.

7.       The method of claim 6, further comprising providing a plurality of selectable water access rights options to withdraw the water at the one or more locations of the waterway, wherein each of the plurality of selectable water access rights options has a respective monetary value based on a corresponding amount of the water to be withdrawn at the one or more locations of the waterway for a corresponding predetermined amount of time.

8.       The method of claim 1, wherein providing at least a portion of one or more water access rights further comprises providing a right to withdraw the water at the one or more locations of the waterway with one of: (i) a reduced consumptive use fee; and (ii) a waived consumptive use fee.

9.       The method of claim 1, wherein providing at least a portion of one or more water access rights further comprises providing one or more credits to the one or more operational entities, wherein each of the one or more credits correlates to an amount of the water to be withdrawn at the one or more locations of the waterway.

10.      The method of claim 1, further comprising:

receiving the one or more water access rights from a water rights granting entity; and

providing at least a portion of the one or more water access rights received from the rights granting entity to the one or more remote operational facilities.

11.       The method of claim 1, further comprising causing the one or more water access rights to be provided to the one or more remote operational facilities from a water rights granting entity by treating the impaired water and discharging the treated water into the waterway.

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Docket No. 140552.00101 PATENT

12.       The method of claim 1, wherein the withdrawing of the impaired water from the impaired water body further comprises withdrawing free flowing water from the impaired water body.

13.       The method of claim 1, wherein the withdrawing of the impaired water from the impaired water body further comprises withdrawing stored water from the impaired water body.

14.       A method for managing water rights, the method comprising:

introducing a treated water flow into a waterway from which one or more operational facilities withdraw water;

receiving, from a water access rights granting entity, one or more water access rights to withdraw the water from the waterway in exchange for introducing the treated water flow into the waterway; and

providing at least a portion of the one or more water access rights to the one or more operational facilities in exchange for a monetary value.

15.       The method of claim 14, wherein receiving one or more water access rights includes receiving rights to withdraw the water when a flow level of the water is less than or equal to a predetermined pass-by water level threshold.

16.       The method of claim 14, wherein receiving one or more water access rights includes receiving access to the water until the flow level of the water is less than or equal to a predetermined relief water level threshold that is lower than the predetermined pass-by water level threshold.

17.       The method of claim 14, wherein providing at least a portion of the one or more water access rights further comprises providing one or more water access rights credits to the one or more operational facilities, and

further comprising permitting the one or more operational facilities to exchange the one or more water rights credits to withdraw an amount of the water when such withdrawal would otherwise not be permitted.

18.       The method of claim 14, wherein receiving the one or more water access rights further comprises receiving rights to withdraw an amount of the water downstream from a location where the treated water flow is introduced to the waterway based on an amount of the treated water introduced upstream.

19.       The method of claim 14, wherein receiving the one or more water access rights further comprises receiving rights to withdraw an amount of the water upstream from a location where the treated water flow is introduced to the waterway based on an amount of the treated water introduced to the waterway.

20.       The method of claim 14, wherein providing at least a portion of the one or more water access rights further comprises providing one or more rights to withdraw the water with one of: (i) a reduced consumptive use fee; and (ii) a waived consumptive use fee.

21.       A water treatment and conveyance system comprising:

a water withdrawing system configured to withdraw impaired water from an acid mined drainage water body;

a treatment system configured to treat the impaired water from the acid mined drainage water body to produce treated water;

a waterway connected to the acid mined drainage water body for conveying the treated water to one or more remote locations of the waterway;

a discharge system configured to discharging the treated water into the waterway;

and one or more remote operational facilities configured to withdraw water from the waterway at the one or more remote locations of the waterway.

22.       The system of claim 21, wherein the treatment system is a passive treatment system.

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Docket No. 140552.00101 PATENT

ABSTRACT

A method of supplying water using a natural water pipeline includes withdrawing impaired water from an impaired water body connected to a waterway and treating the impaired water from the impaired water body to produce treated water. The method also includes discharging the treated water into the waterway and conveying the treated water via the waterway to one or more locations proximate to one or more remote operational facilities that withdraws water from the waterway at the one or more locations. The method further includes receiving a monetary value from one or more operational entities operating the one or more remote operational facilities and providing at least a portion of one or more water access rights to the one or more operational entities in exchange for the monetary value.

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EX1A-6 MAT CTRCT

Exhibit 6.3

 

Contract Agreement for the Preliminary Proposal For The Utilization & Treatment Of The Mocanaqua Tunnel AMD Mine Pool Project between EPCAMR and American Energy Solutions, LLC

This letter will serve as the Contract Agreement for the Preliminary Proposal For The Utilization & Treatment Of The Mocanaqua Tunnel AMD Mine Pool Project between American Energy Solutions, LLC (AES), located at 1648 Washington Avenue, Northampton, PA, 18067, subcontractor, herein recognized as (AES), and the Eastern PA Coalition for Abandoned Mine Reclamation (EPCAMR), located at 101 South Main Street, Ashley, PA 18706, herein recognized as (EPCAMR). In this letter, EPCAMR will lay out proposed terms for our relationship during the course of the project. The first phase is to complete the Phase I of the Preliminary Proposal For The Utilization & Treatment Of The Mocanaqua Tunnel AMD Mine Pool Project. The signatures on the letter will signify agreement with the terms on behalf EPCAMR and AES, respectively.

Invoicing and Narrative Reporting by AES

AES, will invoice EPCAMR on a monthly schedule. Invoices will include a separate narrative report on project activities completed directly related to the Preliminary Proposal For The Utilization & Treatment Of The Mocanaqua Tunnel AMD Mine Pool Project Scope of Work-Task & Deliverables attached and an estimate of the percent completion on each task included within the Scope of Work. The invoice billable amounts will be submitted at the fifty (50) percent completion of the agreed-upon task and deliverables, according to the approved grant budget, and at one hundred (100) percent completion of the agreed upon task and deliverables. Invoiced billable amounts will be provided as a separate invoice from the narrative report.

Payment of Invoices by EPCAMR

EPCAMR is responsible for submitting reimbursement requests to the Susquehanna River Basin Commission in order to assure timely payment of AES invoices along with the separate AES narrative report, upon receipt of the proper documentation from AES. EPCAMR will also provide a narrative Progress Report detailing the status of the project and EPCAMR reimbursement for related project expenses to the Susquehanna River Basin Commission who, upon receipt, of the proper invoices and inspection and approval of any work and documentation, will reimburse EPCAMR, who can then pay AES Invoices. Any problems or delays with reimbursements from the Susquehanna River Basin Commission will be communicated to AES, in writing, via EPCAMR Letterhead, or e-mail communication with read receipt notification, so that unexpected delays in subcontractor payments can be minimized. AES understands and agrees that EPCAMR's payments to AES shall be made on a reimbursement basis.

Engineering Designs

The Susquehanna River Basin Commission has the right to review and approve all engineering designs prior to commencement of any work by EPCAMR, its agents, or assigns, to determine whether the designs meet the Susquehanna River Basin Commission's objectives with regard to the project. The Susquehanna River Basin Commission shall complete its review of the designs submitted to EPCAMR from AES and shall notify EPCAMR of any deficiencies and will require that AES resubmit the designs within thirty (30) days of the Susquehanna River Basin Commission's notice of said deficiencies.

Compliance Standards

AES shall comply with all federal statutes, executive orders, circulars, regulations, policies, procedures, and directives, as they may be amended or promulgated from time to time during the term of this contract. AES shall comply with all applicable Commonwealth of PA statutes, management directives, circulars, regulations, policies, and procedures, as they may be amended or promulgated from time to time during the term of this contract.

Requirements Applicable to Susquehanna River Basin Commission Funding

AES shall comply with all requirements of the Susquehanna River Basin agreement with EPCAMR.

Environmental Provisions

In the performance of this contract, AES shall minimize pollution and shall strictly comply with all applicable environmental laws and regulations.

Scope of Work —Tasks, Budget and Deliverables

See Attached Separate Document for Phases of Proposed MIW/AMD Treatment Project from SRBC for completion of PHASE I and PHASE II

TOTAL PHASE I for AES-	$	2,500.00
TOTAL PHASE II for AES-	$	4,100.00
TOTAL PHASE I & II for AES	$	6,600.00

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Fixed Costs Contract

AES understands that EPCAMR has a fixed cost contract with the Susquehanna River Basin Commission that cannot be easily modified. AES's budget for this project is also at a fixed cost. There are to be no deviations from the approved budget and or change orders to the scope of work. EPCAMR cannot incur any unanticipated cost overruns due to the nature of the grant. EPCAMR intends to stay within budget and cannot exceed the grant contract agreement award. All work shall be performed in accordance with plans reviewed and approved by the PA Department of Environmental Protection (PA DEP), Division of Dam Safety, and shall include working with the local utility company to replace and relocation of one to two utility poles that will be affected by the eventual construction in the project area. EPCAMR cannot commence any construction activities until, in writing, that the PA DEP and any other permitting agencies approve of the project and necessary permits provided.

Insurance Coverage

AES shall furnish to EPCAMR, an insurance certificate naming EPCAMR, as an additional insured, providing public liability insurance for bodily injury, including death, and property damage in the minimum amount of Five Hundred Thousand dollars ($500,000) per person, One Million Dollars ($1,000,000) per occurrence. Any AES subcontractors will be required to maintain the same levels of insurance and copies should be provided to EPCAMR for the grant file. EPCAMR is responsible for assuring that its staff, volunteers, and sub-contractors are all adequately insured when working or visiting the Preliminary Proposal For The Utilization & Treatment Of The Mocanaqua Tunnel AMD Mine Pool Project site with AES personnel. EPCAMR will provide a copy of the certificates of insurance or the relevant insurance policy documents to the Susquehanna River Basin Commission.

Hold Harmless Agreement

AES agrees to indemnify, defend, and save harmless EPCAMR, its officers, agents, and employees from:

● Any and all claims for payment, damages, costs, or expenses demanded by any and all contractors, subcontractors, materialmen, laborers, and any other persons, firm or corporation furnishing or supplying work, services, materials, or supplies, in connection with AES's performance of its obligations under this contract.

● Any damages to property or injuries (including death) to any person(s) and any other losses, damages, expenses, claims, demands, suits, and actions by any party against the Susquehanna River Basin Commission arising out of the willful or negligent acts or omissions of AES its agents, contractors, subcontractors, and employees in AES's performance of its obligations under this contract.

● AES will notify EPCAMR and or vice versa within a reasonable time of any written claims or demands against any and all parties for which AES is responsible under this paragraph.

Severability

In the event that any one or more of the provisions herein contained shall be in violation of or not enforceable because of any law, it is understood that said provisions shall be deemed modified to the extent necessary to comply with said law or if such modification would be impracticable, shall be deemed deleted and none of the other rights or obligations herein shall be prejudiced or rendered unenforceable by reason thereof.

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Independent Capacity of Contractor

A. The parties to this contract agree that the services performed by AES under the terms of the contract are performed as an independent contractor

B. Except as otherwise provided by the terms of the contract, the Susquehanna River Basin Commission shall have no control over the manner in which the contractual services are performed by AES or any employees or subcontractors of the AES, should there be any. Any job specifications or standards of work attached to or incorporated into this contract or any subcontracting restrictions contained in this contract shall not be construed as the Susquehanna River Basin Commission's direction or control over the manner of the performance of services provided by AES.

Contract Integration

A. This contract, when executed, approved and delivered, together with all exhibits incorporated by reference, shall constitute the final, complete and exclusive contract between the EPCAMR and AES containing all the terms and conditions agreed on by AES and EPCAMR.

B. All representations, understandings, and agreements pertaining to the subject matter of this contract made prior to or at the time this contract is executed are superseded by this contract.

C. There are no conditions precedent to the performance of this contract except as expressly set forth herein.

Non-Discrimination/Sexual Harassment

AES agrees:

A. In the hiring of any employee(s) for the manufacture of supplies, performance of work, or any other activity required under the contract or any subcontract, Grantee, each subgrantee, or any person acting on behalf of AES shall not discriminate in violation of the Pennsylvania Human Relations Act (PHRA) and applicable federal laws against any citizen of this Commonwealth of PA who is qualified and available to perform the work to which the employment relates.

B. Neither AES nor any person on their behalf shall in any manner discriminate in violation of the PHRA and applicable federal laws against or intimidate any employee involved in the manufacture of supplies, the performance of work, or any other activity required under the contract.

C. AES shall establish and maintain a written nondiscrimination and sexual harassment policy and shall inform their employees of the policy. The policy must contain a provision that sexual harassment will not be tolerated and employees who practice it will be disciplined. Posting this Non-Discrimination/Sexual Harassment Clause conspicuously in easily-accessible and well lighted places customarily frequented by employees and at or near where the contract services are performed shall satisfy this requirement.

D. AES shall not discriminate in violation of PHRA and applicable federal laws against any subgrantee or supplier who is qualified to perform the work to which the contract relates.

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E. AES's obligations pursuant to these provisions are ongoing from and after the effective date of the contract through the termination date thereof. Accordingly, AES shall have an obligation to inform EPCAMR if, at any time during the term of the contract, it becomes aware of any actions or occurrences that would result in violation of these provisions.

F. EPCAMR may cancel or terminate the contract and all money due or to become due under the contract may be forfeited for a violation of the terms and conditions of this Nondiscrimination/Sexual Harassment Clause. In addition, the agency may proceed with debarment or suspension and may place Grantee in the Contractor Responsibility File.

Contractor Integrity Provisions

It is essential that those who seek to contract with EPCAMR observe high standards of honesty and integrity. They must conduct themselves in a manner that fosters public confidence in the integrity of the EPCAMR contracting and procurement process.

A. In furtherance of this policy, AES agrees to the following:

i. AES shall maintain the highest standards of honesty and integrity during the performance of this contract and shall take no action in violation of state or federal laws or regulations or any other applicable laws or regulations, or other requirements applicable to AES or that govern contracting or procurement with EPCAMR.

ii. AES shall not have a financial interest in any other contractor, subcontractor, or supplier providing services, labor, or material under this contract, unless the financial interest is disclosed to EPCAMR in writing and EPCAMR consents to AES's financial interest prior to EPCAMR's execution of the contract. AES shall disclose the financial interest to EPCAMR at the time of bid or proposal submission, or if no bids or proposals are solicited, no later than AES's submission of the contract signed by AES.

v. AES certifies to the best of its knowledge and belief that within the last five (5) years AES or AES Related Parties have not:

1.       been indicted or convicted of a crime involving moral turpitude or business honesty or integrity in any jurisdiction;

2.       been suspended, debarred or otherwise disqualified from entering into any contract with any governmental agency;

3.       had any business license or professional license suspended or revoked;

4.       had any sanction or finding of fact imposed as a result of a judicial or administrative proceeding related to fraud, extortion, bribery, bid rigging, embezzlement, misrepresentation or anti-trust; and

5.       been, and is not currently, the subject of a criminal investigation by any federal, state or local prosecuting or investigative agency and/or civil anti-trust investigation by any federal, state or local prosecuting or investigative agency.

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Accordingly, AES shall have an obligation to immediately notify EPCAMR in writing if at any time during the term of the contract if becomes aware of any event which would cause the AES's certification or explanation to change. AES acknowledges that EPCAMR may, in its sole discretion, terminate the contract for cause if it learns that any of the certifications made herein are currently false due to intervening factual circumstances or were false or should have been known to be false when entering into the contract.

i.       Contractor shall comply with the requirements of the Lobbying Disclosure Act (65 Pa. C. S. §13A01 et seq.) regardless of the method of award. If this contract was awarded on a Non-bid Basis, Contractor must also comply with the requirements of the Section 1641 of the Pennsylvania Election Code (25 P.S. §3260a).

ii.       When AES has reason to believe that any breach of ethical standards as set forth in law, or these Contractor Integrity Provisions has occurred or may occur, if acted upon, would violate such ethical standards, AES shall immediately notify EPCAMR in writing.

iii.       AES, by submission of its bid or proposal and/or execution of this contract and by the submission of any bills, invoices or requests for payment pursuant to the contract, certifies and represents that it has not violated any of these Contractor Integrity Provisions in connection with the submission of the bid or proposal, during any contract negotiations or during the term of the contract, to include any extensions thereof. AES shall immediately notify EPCAMR in writing of any actions for occurrences that would result in a violation of these Contractor Integrity Provisions. AES agrees to reimburse EPCAMR for the reasonable costs of investigation incurred by the Office of the State Inspector General for investigations of the AES's compliance with the terms of this or any other agreement between AES and EPCAMR that results in the suspension or debarment of AES. AES shall not be responsible for investigative costs for investigations that do not result in the AES's suspension or debarment.

iv.       AES shall cooperate with the Office of the State Inspector General in its investigation of any alleged agency or employee breach of ethical standards and any alleged Contractor non-compliance with these Contractor Integrity Provisions. AES agrees to make identified AES employees available for interviews at reasonable times and places. AES, upon the inquiry or request of an Inspector General, shall provide, or if appropriate, make promptly available for inspection or copying, any information of any type or form deemed relevant by the Office of the State Inspector General to AES's integrity and compliance with these provisions. Such information may include, but shall not be limited to, AES's business or financial records, documents or files of any type or form that refer to or concern this contract. AES shall incorporate this paragraph in any agreement, contract or subcontract it enters into in the course of the performance of this contract solely for the purpose of obtaining subcontractor compliance with this provision. The incorporation of this provision in a subcontract shall not create privity of contract between EPCAMR and any such subcontractor, and no third party beneficiaries shall be created thereby.

x.        For violation of any of these Contractor Integrity Provisions, EPCAMR may terminate this and any other contract with AES, claim liquidated damages in an amount equal to the value of anything received in breach of these Provisions, claim damages for all additional costs and expenses incurred in obtaining another contractor to complete performance under this contract. These rights and remedies are cumulative, and the use or non-use of anyone shall not preclude the use of all or any other. These rights and remedies are in addition to those the Commonwealth of PA may have under law, statute, regulation, or otherwise.

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Entire Contract; Waiver

This Agreement, together with all attachments hereto, and other documents or instruments executed by AES and EPCAMR in connection herewith, constitute the entire contract between AES and EPCAMR, with respect to each other's obligations hereunder. Waiver by AES or EPCAMR of any breach by the other party of any term, covenant or condition hereof shall not operate as a waiver of any subsequent breach thereof. Failure by AES or EPCAMR to exercise any of its rights and remedies under this contract shall not constitute a waiver of those rights or remedies.

Task Completion

AES shall perform its obligations under this Agreement by no later than 18 months from October 1, 2016.

Contract Termination

Unless terminated in accordance with other provisions of this contract, this contract shall terminate on 18 months from October 1, 2016.

Effective Date

This contract shall not be valid or enforceable against EPCAMR, until it has been fully executed and approved.

By signing this form, both parties acknowledge the terms outlined and agree to proceed cooperatively and in good faith on the Preliminary Proposal For The Utilization & Treatment Of The Mocanaqua Tunnel AMD Mine Pool Project.

/s/ Brad Domitrovitsch	/s/ Bernard J. McGurl
Signature	Signature
Brad Domitrovitsch, President, America Energy Solutions, LLC	Bernard J. McGurl, President, EPCAMR
Printed Name	Printed Name
Brad Domitrovitsch
Date           7.14.2016	Date          12-15-2016

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EX1A-12 OPN CNSL

Exhibit 12.1

John E. Lux, Esq.

Attorney at Law

1629 K Street, Suite 300

Washington, DC 20006

(202) 780-1000

Admitted in Maryland and the District of Columbia

August 28, 2017

Board of Directors

American Energy Partners, Inc.

PO Box 443

Allentown, PA 18105

Ladies and Gentlemen:

I have acted, at your request, as special counsel to American Energy Partners, Inc., a Colorado corporation, (“American Energy Partners, Inc.”) for the purpose of rendering an opinion as to the legality of (1) 200,000,000 shares of American Energy Partners, Inc.’ common stock, par value $0.001 per share, (“Shares”) to be offered and distributed by American Energy Partners, Inc. pursuant to an Offering Statement to be filed under Regulation A of the Securities Act of 1933, as amended, by American Energy Partners, Inc. with the U.S. Securities and Exchange Commission (the “SEC”) on Form 1-A, for the purpose of registering the offer and sale of the Shares (“Offering Statement”).

For the purpose of rendering my opinion herein, I have reviewed statutes of the State of Colorado, to the extent I deem relevant to the matter opined upon herein, certified or purported true copies of the Articles of Incorporation of American Energy Partners, Inc. and all amendments thereto, the By-Laws of American Energy Partners, Inc., selected proceedings of the board of directors of American Energy Partners, Inc. authorizing the issuance of the Shares, certificates of officers of American Energy Partners, Inc. and of public officials, and such other documents of American Energy Partners, Inc. and of public officials as I have deemed necessary and relevant to the matter opined upon herein. I have assumed, with respect to persons other than directors and officers of American Energy Partners, Inc., the due and proper election or appointment of all persons signing and purporting to sign the documents in their respective capacities, as stated therein, the genuineness of all signatures, the conformity to authentic original documents of the copies of all such documents submitted to me as certified, conformed and photocopied, including the quoted, extracted, excerpted and reprocessed text of such documents.

Based upon the review described above, it is my opinion that the Shares are duly authorized and when, as and if issued and delivered by American Energy Partners, Inc. against payment therefore, as described in the offering statement, will be validly issued, fully paid and non-assessable.

I have not been engaged to examine, nor have I examined, the Offering Statement for the purpose of determining the accuracy or completeness of the information included therein or the compliance and conformity thereof with the rules and regulations of the SEC or the requirements of Form 1-A, and I express no opinion with respect thereto. My forgoing opinion is strictly limited to matters of Colorado corporation law; and, I do not express an opinion on the federal law of the United States of America or the law of any state or jurisdiction therein other than Colorado, as specified herein.

I hereby consent to the filing of this opinion as Exhibit 12.1 to the Offering Statement and to the reference to our firm under the caption “Legal Matters” in the Offering Circular constituting a part of the Offering Statement. We assume no obligation to update or supplement any of the opinion set forth herein to reflect any changes of law or fact that may occur following the date hereof. 

Very truly yours,

/s/ John E. Lux

John E. Lux