FOX PETROLEUM INC.
PLEDGE AND ESCROW AGREEMENT
<DOCUMENT>
<TYPE>EX-10.7
<SEQUENCE>8
<FILENAME>exhibit10-7.htm
<DESCRIPTION>PLEDGE AND ESCROW AGREEMENT
<TEXT>
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<P align=center><B><U>PLEDGE AND ESCROW AGREEMENT</U></B><B> </B></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>THIS
PLEDGE AND ESCROW AGREEMENT</B> (the &#147;<U>Agreement</U>&#148;) is made and entered
into as of October 31, 2008 (the &#147;<U>Effective Date</U>&#148;) by and among <B>FOX
PETROLEUM, INC.</B>, a corporation organized and existing under the laws of the
State of Nevada (the &#147;<U>Pledgor</U>&#148;), <B>TRAFALGAR CAPITAL SPECIALIZED
INVESTMENT FUND</B>, (the &#147;<U>Pledgee</U>&#148;), and <B>THE LAW OFFICE OF JAMES G.
DODRILL</B><B> </B><B>II, P.A.,</B> as escrow agent (&#147;<U>Escrow Agent</U>&#148;).</P>
<P align=center><B><U>RECITALS</U></B><B>: </B></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>WHEREAS,
</B>in order to secure the full and prompt payment when due (whether at the
stated maturity, by acceleration or otherwise) of all of the Company&#146;s
obligations (the &#147;<U>Obligations</U>&#148;) to the Pledgee or any successor to the
Pledgee under<B> </B>this Agreement, the Securities Purchase Agreement, as
amended of even date herewith between the Pledgor and the Pledgee (the
&#147;<U>Securities Purchase Agreement</U>&#148;), the Convertible Debentures (the
&#147;<U>Convertible</U> <U>Debentures</U>&#148;) issued or to be issued by the Company to
the Pledgee, either now or in the future, up to a total of Three Million Five
Hundred Thousand Dollars ($3,500,000) of principal, plus any interest, costs,
fees, and other amounts owed to the Pledgee thereunder, the Amended Security
Agreement of even date herewith between the Pledgor and the Pledgee (the
&#147;<U>Security</U> <U>Agreement</U>&#148;), and all other contracts entered into
between the parties hereto (collectively, the &#147;<U>Transaction Documents</U>&#148;),
the Pledgor has agreed to irrevocably pledge to the Pledgee, or its designees,
fifteen million (15,000,000) shares (the &#147;<U>Pledged Shares</U>&#148;) of the
Pledgor&#146;s common stock.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>NOW,
THEREFORE,</B> in consideration of the mutual covenants, agreements, warranties,
and representations herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows: </P>
<P align=center><B><U>TERMS AND CONDITIONS</U></B></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Pledge
and Transfer of Pledged Shares</U></B><B>.</B> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Pledgor hereby grants to Pledgee, or its designees, a security interest in
all Pledged Shares as security for Pledgor&#146;s obligations under the Convertible
Debentures. Simultaneously with the execution of the Transaction Documents, the
Pledgor shall deliver to the Escrow Agent stock certificates representing
15,000,000 restricted Pledged Shares, together with duly executed stock powers
or other appropriate transfer documents executed in blank by the Pledgor (the
&#147;<U>Transfer Documents</U>&#148;), and such stock certificates and Transfer Documents
shall be held by the Escrow Agent until the full payment of all amounts due to
the Pledgee under the Convertible Debentures and through repayment in accordance
with the terms of the Convertible Debentures, or the termination or expiration
of this Agreement. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Rights
Relating to Pledged Shares</U></B>. Upon and anytime after the occurrence of an
Event of Default (as defined herein), the Pledgee, or its designees, shall be
entitled to vote the </P>
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<P align=justify>Pledged Shares, to receive dividends and other distributions
thereon, to sell the Pledged Shares, and to enjoy all other rights and
privileges incident to the ownership of the Pledged Shares. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><U>Release of Pledged Shares from Pledge</U></B>. Upon the payment of all
amounts due to the Pledgee under the Convertible Debentures by repayment in
accordance with the terms of the Convertible Debentures, the parties hereto
shall notify the Escrow Agent to such effect in writing. Upon receipt of such
written notice for payment of the amounts due to the Pledgee under the
Convertible Debentures, the Escrow Agent shall return to the Pledgor the
Transfer Documents and the certificates representing the Pledged Shares,
(collectively the &#147;<U>Pledged</U> <U>Materials</U>&#148;), whereupon any and all
rights of Pledgee, or its designees, in the Pledged Materials shall be
terminated. Notwithstanding anything to the contrary contained herein, upon full
payment of all amounts due to the Pledgee under the Convertible Debentures, by
repayment in accordance with the terms of the Convertible Debentures, this
Agreement and Pledgee&#146;s security interest and rights in and to the Pledged
Shares shall terminate. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Event
of Default</U></B>. An &#147;<U>Event of Default</U>&#148; shall be deemed to have
occurred under this Agreement upon an Event of Default under the Transaction
Documents. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><U>Remedies</U></B>. Upon and anytime after the occurrence of an Event of
Default, the Pledgee shall have the right to provide written notice of such
Event of Default (the &#147;<U>Default</U> <U>Notice</U>&#148;) to the Escrow Agent, with
a copy to the Pledgor. As soon as practicable after receipt of the Default
Notice, the Escrow Agent shall deliver to Pledgee the Pledged Materials held by
the Escrow Agent hereunder. Upon receipt of the Pledged Materials, the Pledgee
shall have the right to (i) sell the Pledged Shares and to apply the proceeds of
such sales, net of any selling commissions, to the Obligations owed to the
Pledgee by the Pledgor under the Transaction Documents, including, without
limitation, outstanding principal, interest, legal fees, and any other amounts
owed to the Pledgee, and exercise all other rights and (ii) any and all remedies
of a secured party with respect to such property as may be available under the
Uniform Commercial Code as in effect in the State of Florida. To the extent that
the net proceeds received by the Pledgee are insufficient to satisfy the
Obligations in full, the Pledgee shall be entitled to a deficiency judgment
against the Pledgor for such amount. The Pledgee shall have the absolute right
to sell or dispose of the Pledged Shares in any manner it sees fit and shall
have no liability to the Pledgor or any other party for selling or disposing of
such Pledged Shares even if other methods of sales or dispositions would or
allegedly would result in greater proceeds than the method actually used. The
Escrow Agent shall have the absolute right to disburse the Pledged Shares to the
Pledgee in batches not to exceed 4.9% of the outstanding capital of the Pledgor
(which limit may be waived by the Pledgee providing not less than 65 days&#146; prior
written notice to the Escrow Agent). The Pledgee shall return any Pledged Shares
released to it and remaining after the Pledgee has applied the net proceeds to
all amounts owed to the Pledgee.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
right, power and remedy of the Pledgee provided for in this Agreement or any
other Transaction Document shall be cumulative and concurrent and shall be in
addition to every other such right, power or remedy. The exercise or beginning
of the exercise by the Pledgee of any one or more of the rights, powers or
remedies provided for in this Agreement or any other Transaction Document or now
or hereafter existing at law or in equity or by statute or otherwise shall not
preclude the simultaneous or later exercise by the Pledgee of all such other
rights, powers or remedies, and no failure or delay on the part of the </P>
<P align=center>2 </P>
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<P align=justify>Pledgee to exercise any such right, power or remedy shall
operate as a waiver thereof. No notice to or demand on the Pledgor in any case
shall entitle it to any other or further notice or demand in similar or other
circumstances or constitute a waiver of any of the rights of the Pledgee to any
other further action in any circumstances without demand or notice. The Pledgee
shall have the full power to enforce or to assign or contract is rights under
this Agreement to a third party. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Concerning
the Escrow Agent</U></B><B>.</B> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Escrow Agent undertakes to perform only such duties as are expressly set
forth herein and no implied duties or obligations shall be read into this
Agreement against the Escrow Agent. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Escrow Agent may act in reliance upon any writing or instrument or signature
which it, in good faith, believes to be genuine, may assume the validity and
accuracy of any statement or assertion contained in such a writing or
instrument, and may assume that any person purporting to give any writing,
notice, advice or instructions in connection with the provisions hereof has been
duly authorized to do so. The Escrow Agent shall not be liable in any manner for
the sufficiency or correctness as to form, manner, and execution, or validity of
any instrument deposited in this escrow, nor as to the identity, authority, or
right of any person executing the same; and its duties hereunder shall be
limited to the safekeeping of such certificates, monies, instruments, or other
document received by it as such escrow holder, and for the disposition of the
same in accordance with the written instruments accepted by it in the escrow.
</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pledgee and the Pledgor hereby agree, to defend and indemnify the Escrow Agent
and hold it harmless from any and all claims, liabilities, losses, actions,
suits, or proceedings at law or in equity, or any other expenses, fees, or
charges of any character or nature which it may incur or with which it may be
threatened by reason of its acting as Escrow Agent under this Agreement; and in
connection therewith, to indemnify the Escrow Agent against any and all
expenses, including attorneys&#146; fees and costs of defending any action, suit, or
proceeding or resisting any claim (and any costs incurred by the Escrow Agent
pursuant to Sections 6.4 or 6.5 hereof). The Escrow Agent shall be vested with a
lien on all property deposited hereunder, for indemnification of attorneys&#146; fees
and court costs regarding any suit, proceeding or otherwise, or any other
expenses, fees, or charges of any character or nature, which may be incurred by
the Escrow Agent by reason of disputes arising between the makers of this escrow
as to the correct interpretation of this Agreement and instructions given to the
Escrow Agent hereunder, or otherwise, with the right of the Escrow Agent,
regardless of the instructions aforesaid, to hold said property until and unless
said additional expenses, fees, and charges shall be fully paid. Any fees and
costs charged by the Escrow Agent for serving hereunder shall be paid by the
Pledgor. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If any of the parties shall be in disagreement about the interpretation of this
Agreement, or about the rights and obligations, or the propriety of any action
contemplated by the Escrow Agent hereunder, the Escrow Agent may, at its sole
discretion deposit the Pledged Materials with the Clerk of the United States
District Court of Florida, and, upon notifying all parties concerned of such
action, all liability on the part of the Escrow Agent shall fully cease and
terminate. The Escrow Agent shall be indemnified by the Pledgor, the Company and
</P>
<P align=center>3 </P>
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<P align=justify>Pledgee for all costs, including reasonable attorneys&#146; fees in
connection with the aforesaid proceeding, and shall be fully protected in
suspending all or a part of its activities under this Agreement until a final
decision or other settlement in the proceeding is received. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Escrow Agent may consult with counsel of its own choice (and the costs of such
counsel shall be paid by the Pledgor and Pledgee) and shall have full and
complete authorization and protection for any action taken or suffered by it
hereunder in good faith and in accordance with the opinion of such counsel. The
Escrow Agent shall not be liable for any mistakes of fact or error of judgment,
or for any actions or omissions of any kind, unless caused by its willful
misconduct or gross negligence. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Escrow Agent may resign upon ten (10) days&#146; written notice to the parties in
this Agreement. If a successor Escrow Agent is not appointed within this ten
(10) day period, the Escrow Agent may petition a court of competent jurisdiction
to name a successor. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Conflict
Waiver</U><B>.</B> The Pledgor hereby acknowledges that the Escrow Agent is
counsel to the Pledgee in connection with the transactions contemplated and
referred herein. The Pledgor agrees that in the event of any dispute arising in
connection with this Agreement or otherwise in connection with any transaction
or agreement contemplated and referred herein, the Escrow Agent shall be
permitted to continue to represent the Pledgee and the Pledgor will not seek to
disqualify such counsel and waives any objection Pledgor might have with respect
to the Escrow Agent acting as the Escrow Agent pursuant to this Agreement.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</U><B><U>.</U></B>
Unless otherwise provided herein, all demands, notices, consents, service of
process, requests and other communications hereunder shall be in writing and
shall be delivered in person or by overnight courier service, or mailed by
certified mail, return receipt requested, addressed: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
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  <TR vAlign=top>
    <TD align=left>If to the Pledgor, to: </TD>
    <TD align=left width="60%" >Fox Petroleum, Inc. </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >64 Knightsbridge </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >London, SW1X7JF </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Attention: Richard Joseph Moore
    </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Telephone: 011-44-207-590-9630
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Facsimile: 011-44-207-590-9601
  </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="60%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>With a copy to: </TD>
    <TD align=left width="60%" >Richardson &amp; Patel, LLP
</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >10900 Wilshire Boulevard, Suite
      500 </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Los Angeles, California 90024
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Attention: Peter Hogan </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Telephone: (310) 208-1182 </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Facsimile: (310) 208-1154 </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="60%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>If to the Pledgee: </TD>
    <TD align=left width="60%" >Trafalgar Capital Specialized
      Investment Fund </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >8-10 Rue Mathias Hardt, BP 3023
    </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >L-1030 Luxembourg </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%"
      >Attention:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Andrew Garai,
      Chairman of the Board </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%"
      >Telephone:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 011-44-207-405-0161
    </TD></TR></TABLE>
<P align=center>4 </P>
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<TABLE
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  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%"
      >Facsimile:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;001-786-323-1651
    </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="60%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>With copy to: </TD>
    <TD align=left width="60%" >James Dodrill II, P.A. </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >5800 Hamilton Way </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Boca Raton, FL 33496 </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%" >Telephone:&nbsp;&nbsp; (561)
      862-0529 </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="60%"
      >Facsimile:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (561) 892-7787
  </TD></TR></TABLE>
<P align=justify>Any such notice shall be effective (a) when delivered, if
delivered by hand delivery or overnight courier service, or (b) five (5) days
after deposit in the United States mail, as applicable. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Binding
Effect</U></B>. All of the covenants and obligations contained herein shall be
binding upon and shall inure to the benefit of the respective parties, their
successors and assigns. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Governing
Law; Venue; Service of Process</U></B>. The validity, interpretation and
performance of this Agreement shall be determined in accordance with the laws of
the State of Florida applicable to contracts made and to be performed wholly
within that state except to the extent that Federal law applies. The parties
hereto agree that any disputes, claims, disagreements, lawsuits, actions or
controversies of any type or nature whatsoever that, directly or indirectly,
arise from or relate to this Agreement, including, without limitation, claims
relating to the inducement, construction, performance or termination of this
Agreement, shall be brought in the state superior courts located in Aventura,
Florida or Federal district courts located in Aventura, Florida, and the parties
hereto agree not to challenge the selection of that venue in any such proceeding
for any reason, including, without limitation, on the grounds that such venue is
an inconvenient forum. The parties hereto specifically agree that service of
process may be made, and such service of process shall be effective if made,
pursuant to Section 8 hereto. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Enforcement
Costs</U></B><B>. </B>If any legal action or other proceeding is brought for the
enforcement of this Agreement, or because of an alleged dispute, breach, default
or misrepresentation in connection with any provisions of this Agreement, the
successful or prevailing party or parties shall be entitled to recover
reasonable attorneys&#146; fees, court costs and all expenses even if not taxable as
court costs (including, without limitation, all such fees, costs and expenses
incident to appeals), incurred in that action or proceeding, in addition to any
other relief to which such party or parties may be entitled. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>Remedies
Cumulative</U></B><B>. </B>No remedy herein conferred upon any party is intended
to be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given hereunder or now
or hereafter existing at law, in equity, by statute, or otherwise. No single or
partial exercise by any party of any right, power or remedy hereunder shall
preclude any other or further exercise thereof.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B><U>Counterparts</U></B><B>.</B> This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute the same instrument. </P>
<P align=center>5 </P>
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<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>No
Penalties</U></B><B>. </B>No provision of this Agreement is to be interpreted as
a penalty upon any party to this Agreement. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>JURY
TRIAL</U></B>. EACH OF THE PLEDGEE AND THE PLEDGOR HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVES THE RIGHT WHICH IT MAY HAVE TO A TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION BASED HEREON, OR ARISING OUT OF, UNDER
OR IN ANY WAY CONNECTED WITH THE DEALINGS BETWEEN PLEDGEE AND PLEDGOR, THIS
PLEDGE AND ESCROW AGREEMENT OR ANY DOCUMENT EXECUTED IN CONNECTION HEREWITH, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF ANY PARTY HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE.</P>
<P align=center>6 </P>
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<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>IN
WITNESS WHEREOF</B>, the parties hereto have duly executed this Pledge and
Escrow Agreement as of the date first above written.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD colspan="2" align=left><STRONG>TRAFALGAR CAPITAL SPECIALIZED INVESTMENT
      FUND,</STRONG> </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD colspan="2" align=left><STRONG>LUXEMBOURG</STRONG> </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">By: </TD>
    <TD align=left width="44%">Trafalgar Capital Sari </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Its: </TD>
    <TD align=left width="44%">General Partner </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">By: </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="44%">/s/ Andrew
      Garai </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Name: </TD>
    <TD align=left width="44%">Andrew Garai </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Title: </TD>
    <TD align=left width="44%">Portfolio Manager </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD colspan="2" align=left><STRONG>FOX PETROLEUM, INC.</STRONG> </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">By: </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="44%">/s/ Richard
      Joseph Moore </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Name: </TD>
    <TD align=left width="44%">Richard Joseph Moore </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Title: </TD>
    <TD align=left width="44%">Chief Executive Officer </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD colspan="2" align=left><STRONG>ESCROW AGENT:</STRONG> </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD colspan="2" align=left><STRONG>THE LAW OFFICE OF JAMES G. DODRILL II,
      P.A.</STRONG> </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="6%">&nbsp; </TD>
    <TD align=left width="44%"></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">By: </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="44%">/s/ Jim
      Dodrill </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Name: </TD>
    <TD align=left width="44%">Jim Dodrill, Esq. </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="6%">Title: </TD>
    <TD align=left width="44%">President </TD>
  </TR>
</TABLE>
<P align=center>7 </P>
<P align=justify>&nbsp;</P>
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